PRUDENTIAL GLOBAL FUND INC, 485APOS, 1995-11-01

PRUDENTIAL GLOBAL FUND INC
485APOS, 1995-11-01

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As filed with the Securities and Exchange Commission on November 1, 1995

Registration Statement No. 2-89725
================================================================================

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 18 [X]

and/or

REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940
Amendment No. 19 [X]
(Check appropriate box or boxes)

----------

PRUDENTIAL GLOBAL FUND, INC.
(Exact name of registrant as specified in charter)

ONE SEAPORT PLAZA
NEW YORK, NEW YORK 10292
(Address of Principal Executive Offices) (Zip Code)

----------

Registrant's Telephone Number, Including Area Code: (212) 214-1250

S. Jane Rose, Esq.
One Seaport Plaza
New York, New York 10292
(Name and Address of Agent for Service of Process)

----------

Approximate date of proposed public offering: As soon as practicable after
the effective date of this Registration Statement.

It is proposed that this filing will become effective (check appropriate
box):

[ ] immediately upon filing pursuant to paragraph (b)
[ ] on (date) pursuant to paragraph (b)

[ ] 60 days after filing pursuant to paragraph (a)(i)
[X} on January 2, 1996 pursuant to paragraph (a)(i)

[ ] 75 days after filing pursuant to paragraph (a)(ii)
[ ] on (date) pursuant to paragraph (a)(ii) of Rule 485

If appropriate, check the following box:

[ ] this post-effective amendment designates a new effective date
for a previously filed post-effective amendment

Pursuant to Rule 24f-2 under the Investment Company Act of 1940, Registrant
has previously registered an Indefinite number of shares of its Common Stock par
value $.01 per share. The Registrant intends to file a notice under such Rule
for its fiscal year ended October 31, 1995 within 60 days of such date.

================================================================================
<PAGE>

CROSS REFERENCE SHEET

(as required by Rule 495)

N-1A Item No. Location

Part A

Item 1. Cover Page ............................. Cover Page

Item 2. Synopsis ............................... Fund Expenses; Fund
Highlights

Item 3. Condensed Financial Information ........ Fund Expenses; Financial
Highlights; How the Fund
Calculates Performance

Item 4. General Description of Registrant ...... Cover Page; Fund Highlights;
How the Fund Invests; General
Information

Item 5. Management of Fund ..................... Financial Highlights; How the
Fund is Managed

Item 6. Capital Stock and Other Securities ..... Taxes, Dividends and
Distributions; General
Information

Item 7. Purchase of Securities Being Offered ... Shareholder Guide; How the
Fund Values Its Shares

Item 8. Redemption or Repurchase ............... Shareholder Guide; How the
Fund Values Its Shares

Item 9. Pending Legal Proceedings .............. Not Applicable

Part B

Item 10. Cover Page ............................. Cover Page

Item 11. Table of Contents ...................... Table of Contents

Item 12. General Information and History ........ Not Applicable

Item 13. Investment Objectives and Policies ..... Investment Objective and
Policies; Investment
Restrictions

Item 14. Management of the Fund ................. Directors and Officers;
Manager; Distributor

Item 15. Control Persons and Principal Holders
of Securities .......................... Not Applicable

Item 16. Investment Advisory and Other Services . Manager; Distributor;
Custodian, Transfer and
Dividend Disbursing Agent
and Independent Accountants

Item 17. Brokerage Allocation and Other
Practices ............................. Portfolio Transactions
and Brokerage

Item 18. Capital Stock and Other Securities .... Not Applicable

Item 19. Purchase, Redemption and Pricing of
Securities Being Offered .............. Purchase and Redemption of
Fund Shares; Shareholder
Investment Account; Net Asset
Value

Item 20. Tax Status ............................ Taxes

Item 21. Underwriters .......................... Distributor

Item 22. Calculation of Performance Data ....... Performance Information

Item 23. Financial Statements .................. Financial Statements

Part C
Information required to be included in Part C is set forth under the
appropriate item, so numbered, in Part C to this Post-Effective Amendment
to the Registration Statement.

<PAGE>

Prudential Global Fund, Inc.

Class Z shares
- --------------------------------------------------------------------------------

Prospectus dated January 2, 1996

- --------------------------------------------------------------------------------
Prudential Global Fund, Inc. (the Fund) is an open-end, diversified management
investment company. Its investment objective is to seek long-term growth of
capital, with income as a secondary objective. The Fund seeks to achieve its
objective through investment in a diversified portfolio of securities which will
consist of marketable securities of U.S. and non-U.S. issuers. The Fund may
invest in all types of common stocks and equivalents (such as convertible debt
securities and warrants), preferred stocks, bonds and other debt obligations,
including money market instruments, of foreign and domestic companies and
governments, governmental agencies and international organizations. The Fund may
also invest in stock options, options on debt securities, options on stock
indices, stock index futures and options on stock index futures. There can be no
assurance that the Fund's investment objective will be achieved. See "How the
Fund Invests--Investment Objective and Policies." The Fund's address is One
Seaport Plaza, New York, New York 10292, and its telephone number is (800)
225-1852.

Class Z shares are offered exclusively for sale to the Trustee of the Prudential
Securities 401(k) Plan, a defined contribution plan sponsored by Prudential
Securities (the PSI 401(k) Plan or the Plan). Only Class Z shares are offered
through this Prospectus. The Fund also offers Class A, Class B and Class C
shares through the attached Prospectus dated January 3, 1995 (the Retail Class
Prospectus) which is a part hereof.

This Prospectus sets forth concisely the information about the Fund that a
prospective investor should know before investing. Additional information about
the Fund has been filed with the Securities and Exchange Commission in a
Statement of Additional Information, dated January 3, 1995, which information is
incorporated herein by reference (is legally considered a part of this
Prospectus) and is available without charge upon request to the Fund at the
address or telephone number noted above.

Investors are advised to read this Prospectus and retain it for future
reference.

- -------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
- -------------------------------------------------------------------------------

<PAGE>

FUND EXPENSES

Shareholder Transaction Expenses Class Z Shares
--------------

Maximum Sales Load Imposed on Purchases
(as a percentage of offering price) ......................... None
Maximum Sales Load or Deferred Sales Load Imposed on
Reinvested Dividends ........................................ None
Deferred Sales Load (as a percentage of original
purchase price or redemption proceeds,
whichever is lower) ......................................... None
Redemption Fees ............................................... None
Exchange Fee .................................................. None

Annual Fund Operating Expenses Class Z Shares*
---------------
(as a percentage of average net assets)
Management Fees ............................................... .75%
12b-1 Fees .................................................... None
Other Expenses ................................................ .57%
-----
Total Fund Operating Expenses ................................. 1.32%
=====

1 3 5 10
Example year years years years
- ------- ---- ----- ----- -----
You would pay the following expenses on
a $1,000 investment, assuming:
(1)5% annual return and
(2)redemption at the end of each time period:
Class Z* .................................... $13 $42 $72 $159

The above example is based on expenses expected to have been incurred if Class Z
shares had been in existence during the entire fiscal year ended October 31,
1995. The example should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown.

The purpose of this table is to assist investors in understanding the various
costs and expenses that an investor in Class Z shares of the Fund will bear,
whether directly or indirectly. For more complete descriptions of the various
costs and expenses, see "How the Fund is Managed." "Other Expenses" includes
operating expenses of the Fund, such as Directors' and professional fees,
registration fees, reports to shareholders, transfer agency and custodian fees
and franchise taxes.
- ----------
* Estimated based on expenses expected to have been incurred if Class Z shares
had been in existence during the entire fiscal year ended October 31, 1995.

2
<PAGE>

The following information supplements "How the Fund is Managed--Distributor"
in the Retail Class Prospectus:

Prudential Securities serves as the Distributor of Class Z shares and
incurs the expenses of distributing the Fund's Class Z shares under a
Distribution Agreement with the Fund, none of which are reimbursed by or paid
for by the Fund.

The following information supplements "How the Fund Values its Shares" in the
Retail Class Prospectus:

The NAV of Class Z shares will generally be higher than the NAV of Class
A, B or C shares because Class Z shares are not subject to any distribution
and/or service fee. It is expected, however, that the NAV of the four classes
will tend to converge immediately after the recording of dividends, which
will differ by approximately the amount of the distribution-related accrual
among the classes.

The following information supplements "Taxes, Dividends and
Distributions--Taxation of Shareholders" in the Retail Class Prospectus:

As a qualified plan, the PSI 401(k) Plan generally pays no federal income
tax. Individual participants in the Plan should consult the Plan documents
and their own tax advisers for information on the tax consequences associated
with participating in the PSI 401(k) Plan.

The per share dividends on Class Z shares will generally be higher than the
per share dividends on Classes A, B or C shares as a result of the fact that
Class Z shares are not subject to any distribution and/or service fee.

The following information replaces the information under "Shareholder
Guide--How to Buy Shares of the Fund" and "Shareholder Guide--How to Sell Your
Shares" in the Retail Class Prospectus:

Class Z shares of the Fund are offered exclusively for sale to the Trustee
of the PSI 401(k) Plan. Such shares may be purchased or redeemed only by the
Plan on behalf of individual plan participants at NAV without any sales or
redemption charge. Class Z shares are not subject to any minimum investment
requirements. The Plan purchases and redeems shares to implement the
investment choices of individual plan participants with respect to their
contributions in the Plan. All purchases through the Plan will be for Class Z
shares. Individual plan participants should consult Plan documents for a
description of the procedures and limitations applicable to the making or
changing of investment choices. Copies of the Plan documents are available
from the Prudential Securities Benefits Department at One Seaport Plaza, 33rd
Floor, New York, New York 10292 or by calling (212) 214-7194.

The average net asset value per share at which shares of the Fund are
purchased or redeemed by the Plan for the accounts of individual plan
participants might be more or less than the net asset value per share
prevailing at the time that such participants made their investment choices
or made their contributions to the Plan.

The following information supplements "Shareholder Guide--How to Exchange
Your Shares" in the Retail Class Prospectus:

Effective (as of the date of this Prospectus, Class A shares held through
the PSI 401(k) Plan on behalf of participants will be automatically exchanged
at relative net asset value for Class Z shares. You should contact the
Prudential Securities Benefits Department about how to exchange your Class Z
shares. See "How to Buy Shares of the Fund" above.

The information above also supplements the information under "Fund
Highlights" in the Retail Class Prospectus as appropriate.

3
<PAGE>

PRUDENTIAL GLOBAL FUND, INC.
Supplement dated January 2, 1996 to Prospectus Dated
January 3, 1995

The following information supplements "Financial Highlights" in the
Prospectus:

FINANCIAL HIGHLIGHTS

(for a share outstanding throughout the period indicated)

(Class A, Class B and Class C Shares)

The following financial highlights for Class A, Class B and Class C shares
are unaudited. This information should be read in conjunction with the financial
statements and the notes thereto, which appear in the Statement of Additional
Information. The financial highlights contain selected data for a Class A, Class
B and Class C share of common stock, respectively, outstanding, total return,
ratios to average net assets and other supplemental data for the period
indicated. The information has been determined based on data contained in the
financial statements. No Class Z shares were outstanding during the indicated
period.

<TABLE>

Six Months Ended April 30, 1995
----------------------------------
Class A Class B Class C
------- ------- -------
<S> <C> <C> <C>

PER SHARE OPERATING PERFORMANCE(1):
Net asset value, beginning of period ............................ $14.89 $14.53 $14.53
------ ------ ------
Income from investment operations
Net investment income (loss) ................................... -- (.14) (.06)
Net realized and unrealized gain (loss) on investment
and foreign currency transactions ............................ (.73) (.62) (.70)
------ ------ ------
Total from investment operations .......................... (.73) (.76) (.76)
------ ------ ------
Less distributions
Dividends from net investment income ........................... -- -- --
Distributions paid to shareholders from net realized
gains on investment and foreign currency transactions ........ (.19) (.19) (.19)
------ ------ ------
Total distributions ....................................... (.19) (.19) (.19)
------ ------ ------
Net asset value, end of period ................................. $13.97 $13.58 $13.58
====== ====== ======

TOTAL RETURN# .................................................. (4.90)% (5.23)% (5.23)%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000) ................................ $203,245 $245,619 $2,050
Average net assets (000) ....................................... $124,685 $311,180 $1,608
Ratios to average net assets:
Expenses, including distribution fees ........................ 1.59%* 2.25%* 2.34%*
Expenses, excluding distribution fees ........................ 1.34%* 1.32%* 1.34%*
Net investment income (loss) ................................. (.02)%* (1.13)%* (.99)%*
Portfolio turnover rate ........................................ 28% 28% 28%

</TABLE>
- ----------
* Annualized.

(1) Based on average shares outstanding, by class.

# Total return does not consider the effects of sales loads. Total return is
calculated assuming a purchase of shares on the first day and a sale on the
last day of each period reported and includes reinvestment of dividends and
distributions. Total returns for periods of less than a full year are not
annualized.

1
<PAGE>

The following information supplements "General Information--Description of
Common Stock" in the Prospectus:

The Fund is authorized to offer 500 million shares of common stock, $.01
per share, divided into four classes of shares, designated Class A, Class B,
Class C and Class Z shares, each consisting of 125 million authorized shares.
Each class represents an interest in the same assets of the Fund and is
identical in all respects except that (i) each class is subject to different
sales charges and distribution and/or service fees (except for Class Z
shares, which are not subject to any distribution and/or service fee), (ii)
each class has exclusive voting rights on any matter submitted to
shareholders that relate solely to its arrangement and has separate voting
rights on any matter submitted to shareholders in which the interests of one
class differ from the interests of any other class, (iii) each class has a
different exchange privilege, (iv) only Class B shares have a conversion
feature and (v) Class Z shares are not subject to any sales or redemption
charge and are offered exclusively for sale to the Trustee of the Prudential
Securities 401(k) Plan, a defined contribution plan sponsored by Prudential
Securities. Since Class B and Class C shares generally bear higher
distribution expenses than Class A shares, the liquidation proceeds to
shareholders of those classes are likely to be lower than to Class A
shareholders and to Class Z shareholders whose shares are not subject to any
distribution and/or service fee. In accordance with the Fund's Articles of
Incorporation, the Board of Directors may authorize the creation of
additional series and classes within such series, with such preferences,
privileges, limitations and voting and dividend rights as the Directors may
determine. Currently, the Fund is offering four classes, designated Class A,
Class B, Class C and Class Z shares.

The following information for the Class Z shares supplements "How the Fund
Calculates Performance" in the Prospectus:

The Fund will include performance data for each class of shares offered
through the Prospectus in any advertisement or information including
performance data of the Fund.

2
<PAGE>

PRUDENTIAL GLOBAL FUND, INC.
Supplement dated January 2, 1996 to
Statement of Additional Information dated January 3, 1995

The following information supplements "Directors and Officers" in the
Statement of Additional Information:

As of October 13, 1995, the directors and officers of the Fund, as a group,
owned less than 1% of the outstanding common stock of the Fund.

As of October 13, 1995, Prudential Securities was the record holder for
other beneficial owners of 5,781,804 Class A shares (or 39% of the
outstanding Class A shares), 12,959,129 Class B shares (or 72% of the
outstanding Class B shares and 192,949 Class C shares (or 8% of the
outstanding Class C shares) of the Fund. In the event of any meetings of
shareholders, Prudential Securities will forward, or cause the forwarding of,
proxy materials to the beneficial owners for which it is the record holder.

The following information supplements "Distributor" in the Statement of
Additional Information:

The following information supplements "Purchase and Redemption of Fund
Shares" in the Statement of Additional Information:

Shares of the Fund may be purchased at a price equal to the next determined
net asset value per share plus a sales charge which, at the election of the
investor, may be imposed either (i) at the time of purchase (Class A shares)
or (ii) on a deferred basis (Class B or Class C shares). Class Z shares of
the Fund are not subject to any sales or redemption charge and are offered
exclusively for sale to the Trustee of the Prudential Securities 401(k) Plan,
a defined contribution plan sponsored by Prudential Securities (the PSI
401(k) Plan). See "Shareholder Guide--How to Buy Shares of the Fund" in the
Prospectus.

Each class represents an interest in the same assets of the Fund and is
identical in all respects except that (i) each class is subject to different
sales charges and distribution and/or service expenses (except for Class Z
shares which are not subject to any sales or redemption charge or any
distribution and/or service fee), (ii) each class has exclusive voting rights
on any matter submitted to shareholders that relates solely to its
arrangement and has separate voting rights on any matter submitted to
shareholders in which the interests of one class differ from the interests of
any other class, (iii) each class has a different exchange privilege, (iv)
only Class B shares have a conversion feature and (v) Class Z shares are
offered exclusively for sale to the Trustee of the PSI 401(k) Plan. See
"Distributor." Each class also has separate exchange privileges. See
"Shareholder Investment Account--Exchange Privilege."

1
<PAGE>

Specimen Price Make-up

Under the current distribution arrangement between the Fund and the
Distributor, Class A shares are sold at a maximum sales charge of 5% and Class
B*, Class C* and Class Z** shares are sold at net asset value. Using the Fund's
net asset value at April 30, 1995, the maximum offering price of the Fund's
shares is as follows:

Class A
Net asset value and redemption price per Class A share ............. $13.97
-------
Maximum sales charge (5% of offering price) ........................ .74
-------
Offering Price to Public ........................................... $14.71
=======
Class B
Net asset value, offering price and redemption price per
Class B share* .................................................... $13.58
=======
Class C
Net asset value, offering price and redemption price per
Class C share* ................................................... $13.58
=======
Class Z
Net asset value, offering price and redemption price per
Class Z share** .................................................. $13.97
=======
- ----------
* Class B and Class C shares are subject to a contingent deferred sales charge
on certain redemptions. See "Shareholder Guide--How to Sell Your
Shares--Contingent Deferred Sales Charges" in the Prospectus.

** Class Z shares did not exist prior to January 2, 1996.

The following information supplements "Shareholder Investment
Account--Exchange Privilege" in the Statement of Additional Information:

Class Z. Class Z shares may be exchanged for Class Z shares of the funds
listed below which participate in the PSI 401(k) Plan. No fee or sales load will
be imposed upon the exchange.

Prudential Allocation Fund
(Balanced Portfolio)
Prudential Equity Income Fund
Prudential Equity Fund, Inc.
Prudential Government Income Fund, Inc.
Prudential Government Securities Trust
(Money Market Series)
Prudential Growth Opportunity Fund, Inc.
Prudential High Yield Fund, Inc.
Prudential MoneyMart Assets, Inc.
Prudential Multi-Sector Fund, Inc.
Prudential Pacific Growth Fund, Inc.
Prudential Utility Fund, Inc.

The following information supplements "Performance Information" in the
Statement of Additional Information:

Average Annual Total Return. The Fund may from time to time advertise its
average annual total return. Average annual total return is determined
separately for Class A, Class B, Class C and Class Z shares. See "How the Fund
Calculates Performance" in the Prospectus.

The average annual total return for Class A shares for the one year and
since inception (January 22, 1990) periods ended April 30, 1995 was (3.75)% and
5.49%, respectively. The average annual total return for the Class B shares of
the Fund for the one,

2
<PAGE>

five and ten year periods ended on April 30, 1995 was (4.39)%, 7.86% and 12.62%,
respectively. The average annual total return for Class C shares since inception
(August 1, 1994) period ended April 30, 1995 was (3.80)%. During these periods,
no Class Z shares were outstanding.

Aggregate Total Return. The Fund may also advertise its aggregate total
return. Aggregate total return is determined separately for Class A, Class B,
Class C and Class Z shares. See "How the Fund Calculates Performance" in the
Prospectus.

The aggregate total return for Class A shares for the one year and since
inception (January 22, 1990) periods ended April 30, 1995 was 1.32% and 39.48%,
respectively. The aggregate total return with respect to the Class B shares of
the Fund for the one, five and ten-year periods ended on April 30, 1995 was
.61%, 46.90%, and 227.87%, respectively. The aggregate total return for Class C
shares for the one year and since inception (August 1, 1994) period ended
April 30, 1995 was (1.83)%. During these periods, no Class Z shares were
outstanding.

The following financial statements are unaudited and are based upon the
results of operations for the interim period ended April 30, 1995. Included
therein are all adjustments, if any, which are, in the opinion of management,
necessary to a fair statement of the results of the interim period presented.

<PAGE>

Portfolio of Investments as of
April 30, 1995 (Unaudited) PRUDENTIAL GLOBAL FUND, INC.
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Description Value (Note 1)
<C> <S> <C>
- ----------------------------------------------------------------
LONG-TERM INVESTMENTS--95.9%
COMMON STOCKS--91.6%
- ----------------------------------------------------------------
Australia--7.6%
353,800 Brambles Industries, Ltd. (Business
& public services) $ 3,487,564
444,300 Broken Hill Proprietary Co., Ltd.
(Energy sources) 6,472,599
1,940,939 BTR Nylex, Ltd. (Industrial
components) 3,795,499
1,044,316 Coca-Cola Amatil, Ltd. (Food &
household products) 6,376,992
1,486,600 Nine Network Australia, Ltd.
(Broadcasting & publishing) 4,268,703
1,708,725 Western Mining Corp. Holdings, Ltd.
(Non-ferrous metals) 9,663,989
-------------
34,065,346
- ----------------------------------------------------------------
Belgium--0.8%
4,800 Bekaert S.A., N.V. (Industrial
components) 3,740,685
- ----------------------------------------------------------------
Federal Republic of Germany--4.2%
6,588 Bilfinger & Berger AG (Construction
& housing) 3,061,761
8,000 Linde AG (Machinery & engineering) 4,595,683
1,520 Linde AG (New) (Machinery &
engineering) 852,950
12,100 Preussag AG (Multi-industry) 3,490,719
6,700 Sap AG (Data processing &
reproduction) 6,892,806
-------------
18,893,919
- ----------------------------------------------------------------
Finland--1.1%
170,100 Kymmene Corp. (Forest products &
paper) 5,092,100
- ----------------------------------------------------------------
France--6.6%
10,600 Carrefour (Merchandising) 5,300,000
7,000 Guyenne et Gascogne* (Merchandising) 2,002,029
42,900 Imetal S.A. (Miscellaneous materials
& commodities) 4,542,353
3,850 La Farge Coppee (New) (Building
materials & components) $ 299,097
49,350 La Farge Coppee (Old) (Building
materials & components) 3,833,884
4,500 Legrand S.A. (Electronics) 6,498,986
18,300 Plastic Omnium (Automotive) 1,989,615
95,300 Valeo (Automotive) 5,412,576
-------------
29,878,540
- ----------------------------------------------------------------
Hong Kong--3.9%
6,142,130 CDL Hotels International* (Real
estate) 2,816,399
1,764,000 Guoco Group, Ltd. (Financial
services) 6,698,734
8,990,000 Hung Hing Printing Group, Ltd.
(General manufacturing) 1,596,648
1,447,000 Hutchison Whampoa, Ltd.*
(Multi-industry) 6,279,928
-------------
17,391,709
- ----------------------------------------------------------------
Indonesia--0.6%
1,821,000 Kabel Metal Industries, Ltd.* (Wire
& cable) 2,854,232
- ----------------------------------------------------------------
Japan--12.3%
264,000 Aiwa Co. (Consumer electronics) 7,368,171
22,500 Autobacs Seven Co. (Merchandising) 2,343,527
130,000 Daibiru Corp. (Real estate) 1,605,701
545 Ddi Corp. (Telecommunications) 4,789,786
43,000 Keyence Corp. (Electronic
components) 4,575,772
96,000 Kyocera Corp. (Public
works-electronics) 7,410,926
106,000 Nichiei Co. (Financial services) 6,823,278
114,000 Nintendo Co., Ltd. (Consumer
electronics) 7,297,625
92,640 Nissen Co., Ltd. (Merchandising) 2,926,632
236,000 Omron Corp. (Electronics) 4,624,703
88,300 Sony Corp. (Consumer goods) 4,477,922
40,000 Tokyo Electronic Co., Ltd.
(Electronic components) 1,244,655
-------------
55,488,698
- --------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.

<PAGE>

Portfolio of Investments as of
April 30, 1995 (Unaudited) PRUDENTIAL GLOBAL FUND, INC.
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Description Value (Note 1)
<C> <S> <C>
- ----------------------------------------------------------------
Korea--2.6%
7,000 Pohang Iron & Steel Co., Ltd.
(Metals) $ 602,348
10,597 Samsung Electronics (New)
(Electronics) 1,640,252
56,248 Samsung Electronics (Old)
(Electronics) 9,038,342
1,454 Shinsegae (New) (Merchandising) 122,637
4,900 Shinsegae (Old) (Merchandising) 417,787
-------------
11,821,366
- ----------------------------------------------------------------
Malaysia--5.0%
2,520,000 IJM Corporation Berhad (Construction
& housing) 8,364,299
333,000 Malayasian Helicopter
(Transportation) 1,031,147
3,177,000 Renong Berhad (Infrastructure) 4,860,984
794,000 Resorts World (Leisure & tourism) 4,178,101
1,647,000 Technology Resources Industries
Berhad (Data processing &
reproduction) 4,200,000
-------------
22,634,531
- ----------------------------------------------------------------
Mexico--1.3%
545,700 Apasco, S.A. (Building materials) 1,923,855
1,521,400 Cifra, S.A. de C.V. (Merchandising) 2,211,559
826,900 Fomento Economico Mexicano, S.A. de
C.V.* (Merchandising) 1,823,739
-------------
5,959,153
- ----------------------------------------------------------------
Netherlands--1.3%
68,000 Heineken N.V. (Beverages) 6,050,367
- ----------------------------------------------------------------
New Zealand--1.5%
2,460,500 Fletcher Challenge, Ltd. (Forest
products & paper) 6,617,271
- ----------------------------------------------------------------
Singapore--6.3%
465,000 Fraser & Neave, Ltd. (Beverages &
tobacco) 5,102,926
1,047,000 O'Seas Union Bank (Banking) 6,045,295
1,031,250 Sembawang Maritime, Ltd.
(Transportation) 4,327,078
313,000 Singapore Airlines, Ltd.
(Transportation) 3,008,320
675,000 United Overseas Bank, Ltd. (Banking) 7,020,155
1,654,000 Wing Tai Holdings (Multi-industry) $ 2,799,771
-------------
28,303,545
- ----------------------------------------------------------------
Spain--3.3%
38,320 Acerinox S.A. (Metals-steel) 4,371,456
25,600 Banco Popular Esp (Banking) 3,483,754
224,862 Centros Commerciale (Pryca)
(Merchandising) 3,966,013
187,600 Dragados y Construcciones*
(Construction & housing) 2,830,696
-------------
14,651,919
- ----------------------------------------------------------------
Sweden--4.5%
172,000 Astra B Free (Health & personal
care) 4,884,151
84,200 Hennes & Mauritz B Free
(Merchandising) 5,671,317
93,600 Missouri Och Domsjo AB (Forest
products & paper) 5,200,214
253,600 Volvo AB (Automotive) 4,748,673
-------------
20,504,355
- ----------------------------------------------------------------
Thailand--1.3%
110,702 Land & House Public Co., Ltd.
(Housing) 1,953,432
1,593,900 Sahavirya Steel (Metals) 4,115,172
-------------
6,068,604
- ----------------------------------------------------------------
United Kingdom--10.0%
319,700 Barclays Bank PLC (Banking) 3,292,747
29,000 Britannic Assured (Insurance) 238,015
1,025,800 British Sky Broadcast (Broadcasting
& publishing) 4,077,513
319,700 Carlton Communications PLC
(Television & communication
equipment) 4,861,947
162,000 Commercial Union PLC (Insurance) 1,452,131
649,300 Guest Keen & Nettlefolds
(Automotive) 6,771,052
540,200 J. Sainsbury PLC (Merchandising) 3,807,715
259,000 S.G. Warburg Group PLC (Financial
services) 3,184,409
688,500 Siebe PLC (Machinery & engineering) 6,238,039
1,629,600 Telewest Communications
(Telecommunications) 4,038,662
</TABLE>
- -------------------------------------------------------------------------------
See Notes to Financial Statements. 5

<PAGE>

Portfolio of Investments as of
April 30, 1995 (Unaudited) PRUDENTIAL GLOBAL FUND, INC.
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>

Shares Description Value (Note 1)
<C> <S> <C>
- ---------------------------------------------------------------
United Kingdom (cont'd.)
2,223,390 Vodafone Group PLC
(Telecommunications) $ 6,941,497
-------------
44,903,727
- ----------------------------------------------------------------
United States--17.4%
71,400 Applied Materials,
Inc.*(Electronics) 4,400,025
275,006 Mattel, Inc. (Recreation & other
consumer goods) 6,531,393
149,500 McDonald's Corp. (Food Serving-Fast
Foods) 5,232,500
276,300 MCI Communications Corp.
(Telecommunications) 6,009,525
112,900 Microsoft Corp. (Computer services) 9,243,687
185,800 Mirage Resorts, Inc. (Hotels &
leisure) 5,574,000
62,600 Mobil Corp. (Energy sources) 5,939,175
134,700 Motorola, Inc. (Television &
electronics) 7,661,062
264,500 Nextel Communications, Inc.
(Telecommunications) 4,265,063
199,000 Norwest Corp. (Banking) 5,273,500
95,800 Pohang Iron & Steel (ADR) (Metals) 2,646,475
187,300 Silicon Graphics, Inc.* (Electronic
components) 7,023,750
116,000 Time Warner, Inc. (Broadcasting &
publishing) 4,248,500
91,300 Viacom, Inc. (Telecommunications) 4,279,688
-------------
78,328,343
-------------
Total common stocks
(cost US$350,020,290) 413,248,410
-------------
PREFERRED STOCKS--3.3%
- ----------------------------------------------------------------
Federal Republic of Germany--0.6%
5,440 Krones AG (Machinery & engineering) 2,583,021
- ----------------------------------------------------------------
Finland--2.7%
294,000 Nokia Corp. (Television &
electronics) $ 11,964,077
-------------
Total preferred stocks
(cost US$7,138,538) 14,547,098
-------------
Warrants
WARRANTS*--0.9%
- ----------------------------------------------------------------
France
3,500 La Farge Coppee, expiring April '96
@ FF460 (Building materials &
components) 11,607
- ----------------------------------------------------------------
Japan--0.5%
400 Autobacs Seven Co., expiring Mar.
'96 @ Y8,231 (Merchandising) 645,000
1,136 Nissen Co., Ltd., expiring Nov. '96
@ Y1,681 (Merchandising) 1,356,662
5,250 Nitori Co., expiring Feb. '98 @
Y3,268 (Merchandising) 309,896
-------------
2,311,558
- ----------------------------------------------------------------
Singapore--0.4%
334,000 United Overseas Bank, Ltd., expiring
June '97 @ SGO2.00 (Banking) 1,748,817
-------------
Total warrants (cost US$4,155,793) 4,071,982
-------------
Principal
Amount
(000)
CORPORATE BONDS
- -----------------------------------------------------------------
Singapore
SGD 97 Sembawang Maritime, Ltd.
Convertible unsecured loan stock
1.50%, 10/25/98
(Transportation)
(cost US$61,850) 134,973
-------------
Total long-term investments (cost
US$361,376,471) 432,002,463
-------------
</TABLE>
- --------------------------------------------------------------------------------
6 See Notes to Financial Statements.

<PAGE>

PRUDENTIAL GLOBAL FUND, INC.
Portfolio of Investments as of April 30, 1995 (Unaudited)
- ----------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount
(000) Description Value (Note 1)
<C> <S> <C>
- ----------------------------------------------------------------
SHORT-TERM INVESTMENTS--0.1%
- ----------------------------------------------------------------
Repurchase Agreement--0.1%
USD293 Joint Repurchase Agreement Account,
5.93%, 5/1/95
(cost US$293,000; Note 5) $ 293,000
- ----------------------------------------------------------------
Total Investments--95.9%
(cost US$361,669,471; Note 4) 432,295,463
Other assets in excess of
liabilities--4.1% 18,618,727
-------------
Net Assets--100% $ 450,914,190
=============

- ---------------
*Non-income producing security.
ADR--American Depository Receipt
</TABLE>

- --------------------------------------------------------------------------------
See Notes to Financial Statements. 7

<PAGE>

Statement of Assets and Liabilities (Unaudited) PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
ASSETS April 30, 1995
Investments, at value (cost $361,669,471)..................... $432,295,463
Foreign currency, at value (cost $11,753,817)................. 11,875,914
Cash.......................................................... 188,527
Receivable for investments sold............................... 6,333,298
Receivable for Fund shares sold............................... 1,233,396
Dividends and interest receivable............................. 1,173,412
Deferred expenses and other assets............................ 17,441
------------
Total assets............................................... 453,117,451
------------
Liabilities
Payable for Fund shares reacquired............................ 919,017
Accrued expenses.............................................. 420,728
Due to Manager................................................ 271,324
Payable for investments purchased............................. 253,401
Due to Distributors........................................... 220,541
Withholding taxes payable..................................... 110,929
Deferred Thailand capital gains tax........................... 7,321
------------
Total liabilities.......................................... 2,203,261
------------
Net Assets.................................................... $450,914,190
------------
Net assets were comprised of:
Common stock, at par....................................... $ 327,920
Paid-in capital in excess of par........................... 372,283,551
------------
372,611,471
Undistributed net investment income........................ 1,676,411
Accumulated net realized gain on investments and foreign
currency transactions.................................... 5,863,577
Net unrealized appreciation on investments and
foreign currencies....................................... 70,762,731
------------
Net assets, April 30, 1995.................................... $450,914,190
============
Class A:
Net asset value and redemption price per share
($203,245,318 / 14,549,204 shares of common stock
issued and outstanding)................................. $13.97
Maximum sales charge (5% of offering price)................ .74
------
Maximum offering price to public........................... $14.71
======
Class B:
Net asset value, offering price and redemption price
per share ($245,619,258 / 18,091,853 shares of
common stock issued and outstanding).................... $13.58
======
Class C:
Net asset value, offering price and redemption price
per share ($2,049,614 / 150,977 shares of
common stock issued and outstanding).................... $13.58
======
</TABLE>

- --------------------------------------------------------------------------------
8 See Notes to Financial Statements.

<PAGE>

PRUDENTIAL GLOBAL FUND, INC.
Statement of Operations (Unaudited)
- -------------------------------------------------------------------------------
Six Months
Ended
April 30,
Net Investment Loss 1995
Income
Dividends (net of foreign withholding taxes
of $302,952)............................. $ 2,498,396
Interest.................................... 204,571
------------
Total income............................. 2,702,967
------------
Expenses
Management fee.............................. 1,627,039
Distribution fee--Class A................... 154,575
Distribution fee--Class B................... 1,430,115
Distribution fee--Class C................... 7,974
Custodian's fees and expenses............... 572,000
Transfer agent's fees and expenses.......... 503,000
Registration fees........................... 55,000
Directors' fees............................. 44,000
Audit fees.................................. 25,000
Legal fees and expenses..................... 22,500
Reports to shareholders..................... 10,000
Insurance................................... 4,500
Miscellaneous............................... 17,884
------------
Total operating expenses................. 4,473,587
------------
Net investment loss............................ (1,770,620)
------------
Realized and Unrealized Gain (Loss)
on Investments and Foreign Currency
Transactions
Net realized gain on:
Investment transactions..................... 5,588,655
Foreign currency transactions............... 925,223
------------
6,513,878
------------
Net change in unrealized
appreciation/depreciation of:
Investments (net of deferred Thailand
capital gains tax of $7,321)............. (30,232,168)
Foreign currencies.......................... 154,815
------------
(30,077,353)
------------
Net loss on investments and foreign
currencies.................................. (23,563,475)
------------
Net Decrease in Net Assets
Resulting from Operations...................... $(25,334,095)
============

Six Months
Increase (Decrease) Ended Year Ended
in Net Assets April 30, 1995 October 31, 1994

Operations
Net investment loss......... $ (1,770,620) $ (3,531,034)
Net realized gain on
investment and foreign
currency transactions.... 6,513,878 18,037,672
Net change in unrealized
appreciation/depreciation
of investments and
foreign currencies....... (30,077,353) 29,668,338
-------------- --------------
Net increase (decrease) in
net assets resulting from
operations............... (25,334,095) 44,174,976
-------------- --------------
Net equalization credits....... 758,707 193,130
-------------- --------------
Distributions paid to
shareholders from net
realized gains on investment
and foreign currency
transactions
Class A..................... (885,696) --
Class B..................... (5,244,431) --
Class C..................... (19,511) --
-------------- --------------
(6,149,638) --
-------------- --------------
Fund share transactions (net of
share conversions) (Note 6)
Proceeds from shares sold... 135,999,805 373,867,022
Net asset value of shares
issued in reinvestment of
distributions............ 5,817,106 --
Cost of shares reacquired... 145,717,662 (225,849,388)
-------------- --------------
Net increase (decrease) in
net assets from Fund
share transactions....... (3,900,751) 148,017,634
-------------- --------------
Total increase (decrease)...... (34,625,777) 192,385,740
Net Assets
Beginning of period............ 485,539,967 293,154,227
-------------- --------------
End of period.................. $ 450,914,190 $ 485,539,967
============== ==============
- --------------------------------------------------------------------------------
See Notes to Financial Statements. 9

<PAGE>

Notes to Financial Statements (Unaudited) PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------

Prudential Global Fund, Inc. (the "Fund") is registered under the Investment
Company Act of 1940 as a diversified, open-end management investment company.
The investment objective of the Fund is to seek long-term capital growth, with
income as a secondary objective, by investing in a diversified portfolio of
securities consisting of marketable securities of U.S. and non-U.S. issuers.

- --------------------------------------------------------------------------------
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 traded on an exchange (whether domestic or
foreign) are valued at the last reported sales price on the primary exchange on
which they are traded. Securities traded in the over-the-counter market
(including securities listed on exchanges for which a last sales price is not
available) are valued at the average of the last reported bid and asked prices.

Short-term securities which mature in more than 60 days are valued based upon
current market quotations. Short-term securities which mature in 60 days or less
are valued at amortized cost which approximates market value.

In connection with transactions in repurchase agreements with U.S. financial
institutions, it is the Fund's policy that its custodian or designated
subcustodians, as the case may be under triparty repurchase agreements, take
possession of the underlying collateral securities, the value of which exceeds
the principal amount of the repurchase transaction including accrued interest.
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.

Foreign Currency Translation: The books and records of the Fund are maintained
in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on
the following basis:

(i) market value of investment securities, other assets and liabilities--at the
closing daily rate of exchange as reported by a major bank;

(ii) purchases and sales of investment securities, income and expenses--at the
rate of exchange prevailing on the respective dates of such transactions.

Although the net assets of the Fund are presented at the foreign exchange rates
and market values at the close of the fiscal year, the Fund does not isolate
that portion of the results of operations arising as a result of changes in the
foreign exchange rates from the fluctuations arising from changes in the market
prices of securities held at fiscal year end. Similarly, the Fund does not
isolate the effect of changes in foreign exchange rates from the fluctuations
arising from changes in the market prices of long-term portfolio securities sold
during the fiscal year.

Net realized gains on foreign currency transactions of $925,223 represent net
foreign exchange gains or losses from sales and maturities of short-term
securities, holding of foreign currencies, currency gains or losses realized
between the trade and settlement dates on security transactions, and the
difference between the amounts of dividends, interest and foreign taxes recorded
on the Fund's books and the U.S. dollar equivalent amounts actually received or
paid. Net unrealized currency gains and losses from valuing foreign currency
denominated assets and liabilities (other than investments) at fiscal year end
exchange rates are reflected as a component of net unrealized appreciation on
investments and foreign currencies.

Foreign security and currency transactions may involve certain considerations
and risks not typically associated with those of domestic origin as a result of,
among other factors, the possibility of political and economic instability and
the level of governmental supervision and regulation of foreign securities
markets.

Securities Transactions and Investment Income: Securities transactions are
recorded on the trade date. Realized gains and losses from investment and
currency transactions are calculated on the identified cost basis. Dividend
income is recorded on the ex-dividend date, and interest income is recorded on
an accrual basis.

Net investment income (other than distribution fees) and unrealized and realized
gains or losses are allocated daily to each class of shares of the Fund based
upon the relative proportion of net assets of each class at the beginning of the
day.

Equalization: The Fund follows the accounting practice known as equalization by
which a portion of the proceeds from sales and costs of reacquisitions of Fund
shares, equivalent on a per share basis to the amount of distributable net
investment income on the date of the transaction, is credited or charged to
undistributed net investment income. As a result, undistributed net investment
income per share is unaffected by sales or reacquisitions of the Fund's shares.
- --------------------------------------------------------------------------------
10

<PAGE>

Notes to Financial Statements (Unaudited) PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
Reclassification of Capital Accounts: The Fund accounts and reports for
distributions to shareholders in accordance with the A.I.C.P.A.'s Statement of
Position 93-2: Determination, Disclosure, and Financial Statement Presentation
of Income, Capital Gain, and Return of Capital Distributions by Investment
Companies. The effect of applying this statement was to increase undistributed
net investment income by $925,223, and decrease accumulated net realized gain on
investments and foreign currency transactions by $925,223 for the six months
ended April 30, 1995.

Dividends and Distributions: The Fund expects to pay dividends of net investment
income and distributions of net realized capital and currency 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. These differences are primarily due to differing treatments for
foreign currency transactions.

Federal Income Taxes: It is the Fund's policy to continue 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.

Withholding taxes on foreign dividends, interest and capital gains have been
provided for in accordance with the Fund's understanding of the applicable
country's tax rules and rates.

- --------------------------------------------------------------------------------
Note 2. Agreements

The Fund has a management agreement with Prudential Mutual Fund Management, Inc.
("PMF"). Pursuant to this agreement, PMF has responsibility for all investment
advisory services and supervises the subadviser's performance of such services.
PMF has entered into a subadvisory agreement with The Prudential Investment
Corporation ("PIC"); PIC furnishes investment advisory services in connection
with the management of the Fund. PMF pays for the cost of the subadviser's
services, the compensation of officers of the Fund, occupancy and certain
clerical and bookkeeping costs of the Fund. The Fund bears all other costs and
expenses.

The management fee paid PMF is computed daily and payable monthly, at an annual
rate of .75 of 1% of the average daily net assets of the Fund.

The Fund has distribution agreements with Prudential Mutual Fund Distributors,
Inc. ("PMFD"), which acts as the distributor of the Class A shares of the
Fund, and with Prudential Securities Incorporated ("PSI"), which acts as
distributor of the Class B and Class C shares of the Fund (collectively the
"Distributors"). The Fund compensates the Distributors for distributing and
servicing the Fund's Class A, Class B and Class C shares, pursuant to plans of
distribution, (the "Class A, B and C Plans") regardless of expenses actually
incurred by them. The distribution fees are accrued daily and payable monthly.

Pursuant to the Class A, B and C Plans, the Fund compensates PMFD for
distribution-related activities with respect to Class A shares at an annual rate
of up to .30 of 1% of the average daily net assets of the Class A shares, .75 of
1% of the average daily net assets up to the level of average daily net assets
as of February 26, 1986, plus 1% of the average daily net assets in excess of
such level of the Class B shares and 1% of average daily net assets of Class C
shares. Such expenses under the Plans were .25 of 1%, .93% of 1% and 1% of the
average daily net assets of Class A, B and C shares, respectively, for the six
months ended April 30, 1995.

PMFD has advised the Fund that it has received approximately $141,700 in
front-end sales charges resulting from sales of Class A shares during the six
months ended April 30, 1995. From these fees, PMFD paid such sales charges to
dealers (PSI and Prusec) which in turn paid commissions to salespersons.

PSI has advised the Fund that for the six months ended April 30, 1995, it
received approximately $432,500 in contingent deferred sales charges imposed
upon certain redemptions by Class B and C shareholders.

PMFD is a wholly-owned subsidiary of PMF; PSI, PMF and PIC are indirect,
wholly-owned subsidiaries of The Prudential Insurance Company of America.

- --------------------------------------------------------------------------------
Note 3. Other Transactions With Affiliates

Prudential Mutual Fund Services, Inc. ("PMFS"), a wholly owned subsidiary of
PMF, serves as the Fund's transfer agent and during the six months ended April
30, 1995, the Fund incurred fees of approximately $419,000 for the services of
PMFS. As of April 30, 1995, approximately $151,000 of such fees were due to
PMFS. Transfer agent fees and expenses in the Statement of Operations include
certain out-of-pocket expenses paid to non-affiliates.

For the six months ended April 30, 1995, PSI and/or its foreign affiliates
earned approximately $311 in brokerage commissions from portfolio transactions
executed on behalf of the Fund.
- --------------------------------------------------------------------------------
11

<PAGE>

Notes to Financial Statements (Unaudited) PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
Note 4. Portfolio Securities

Purchases and sales of investment securities, other than short-term investments,
for the six months ended April 30, 1995 were $120,950,310 and $134,724,246,
respectively.

The United States federal income tax basis of the Fund's investments at October
31, 1994 was $361,669,471 and accordingly, net unrealized appreciation for
federal income tax purposes was $70,625,992 (gross unrealized appreciation--
$88,800,252; gross unrealized depreciation--$18,174,260).
- --------------------------------------------------------------------------------
Note 5. Joint Repurchase Agreement Account

The Portfolio, along with other affiliated registered investment companies,
transfers uninvested cash balances into a single joint account, the daily
aggregate balance of which is invested in one or more repurchase agreements
collateralized by U.S. Treasury or Federal agency obligations. As of April 30,
1995, the Portfolio has a .03% undivided interest in the repurchase agreements
in the joint account. The undivided interest for the Portfolio represents
$293,000 in principal amount. As of such date, each repurchase agreement in the
joint account and the value of the collateral therefor were as follows:

Bear, Stearns & Co., 5.92%, in the principal amount of $125,000,000, repurchase
price $125,061,667, due 5/1/95. The value of the collateral including accrued
interest is $127,647,875.

UBS Securities Inc., 5.93%, in the principal amount of $100,000,000, repurchase
price $100,049,417, due 5/1/95. The value of the collateral including accrued
interest is $102,062,500.

Morgan Stanley and Co., Inc., 5.93% in the principal amount of $225,000,000,
repurchase price $225,111,188, due 5/1/95. The value of the collateral including
accrued interest is $229,640,625.

CS First Boston Corp., 5.93%, in the principal amount of $225,000,000,
repurchase price $225,111,188, due 5/1/95. The value of the collateral including
accrued interest is $229,640,625.
- --------------------------------------------------------------------------------
Note 6. Capital

The Fund offers Class A, Class B and Class C shares. Class A shares are sold
with a front-end sales charge of up to 5%. Class B shares are sold with a
contingent deferred sales charge which declines from 5% to zero depending on the
period of time the shares are held. Class C shares are sold with a contingent
deferred sales charge of 1% during the first year. Class B shares will
automatically convert to Class A shares on a quarterly basis approximately seven
years after purchase commencing in or about February 1995. There are 500 million
shares of common stock, $.01 par value per share, divided equally into three
classes, designated Class A, Class B and Class C common stock.

Transactions in shares of common stock were as follows:

Class A Shares Amount
- ---------------------------------- ----------- -------------
Six months ended April 30, 1995:
Shares sold....................... 5,805,256 $ 75,051,226
Shares issued in reinvestment of
dividends and distributions..... 65,491 871,689
Shares reacquired................. (5,878,129) (77,172,037)
----------- -------------
Net decrease in shares outstanding
before conversion............... (7,382) (1,249,122)
Shares issued upon conversion from
Class B......................... 9,600,370 122,789,979
----------- -------------
Net increase in shares
outstanding..................... 9,592,988 $ 121,540,857
=========== =============
Year ended October 31, 1994:
Shares sold....................... 8,934,836 $ 124,979,118
Shares reacquired................. (7,169,344) (100,448,720)
----------- -------------
Net increase in shares
outstanding..................... 1,765,492 $ 24,530,398
=========== =============

Class B Shares Amount
- ---------------------------------- ----------- -------------
Six months ended April 30, 1995:
Shares sold....................... 4,608,311 $ 59,673,397
Shares issued in reinvestment of
dividends and distributions..... 379,972 4,928,231
Shares reacquired................. (5,284,129) (68,149,704)
----------- -------------
Net decrease in shares outstanding
before conversion............... (295,846) (3,548,076)
Shares reacquired upon conversion
into Class A.................... (9,870,475) (122,789,979)
----------- -------------
Net decrease in shares
outstanding..................... (10,166,321) $(126,338,055)
=========== =============
Year ended October 31, 1994:
Shares sold....................... 17,971,424 $ 247,670,808
Shares reacquired................. (9,114,786) (125,372,515)
----------- -------------
Net increase in shares
outstanding..................... 8,856,638 $ 122,298,293
=========== =============
Class C
- ----------------------------------
Six months ended April 30, 1995:
Shares sold....................... 97,760 $ 1,275,182
Shares issued in reinvestment of
dividends and distributions..... 1,325 17,186
Shares reacquired................. (31,081) (395,921)
----------- -------------
Net increase in shares
outstanding..................... 68,004 $ 896,447
=========== =============
- --------------------------------------------------------------------------------
12 See Notes to Financial Statements.

<PAGE>

Notes to Financial Statements (Unaudited) PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
Class C Shares Amount
- ---------------------------------- ----------- -------------
August 3, 1994* through
October 31, 1994:
Shares sold....................... 84,982 $ 1,217,096
Shares reacquired................. (2,009) (28,153)
----------- -------------
Net increase in shares
outstanding..................... 82,973 $ 1,188,943
=========== =============
- ---------------
* Commencement of offering of Class C shares.
- ------------------------------------------------------------
Note 7. Dividends and Distributions
On June 5, 1995, the Board of Trustees of the Fund declared the following
distribution per share, payable on June 21, 1995 to shareholders of record on
June 12, 1995:
Class B
Class A and C
------- -------
Long-Term Capital Gains................... $0.0084 $0.0084
- --------------------------------------------------------------------------------
13

<PAGE>

- ---------------
* Annualized.
@ Commencement of offering of Class A shares.
(1) Based on average shares outstanding, by class.
# Total return does not consider the effects of sales loads. Total return
is calculated assuming a purchase of shares on the first day and a sale
on the last day of each period reported and includes reinvestment of
dividends and distributions. Total returns for periods of less than a
full year are not annualized.

- --------------------------------------------------------------------------------
14 See Notes to Financial Statements.

<PAGE>

Financial Highlights (Unaudited) PRUDENTIAL GLOBAL FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class B
-----------------------------------------------------------------------------
Six Months
Ended Year Ended October 31,
April 30, ------------------------------------------------------------
1995 1994 1993 1992 1991 1990
------------ -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE (1):
Net asset value, beginning of period.......... $ 14.53 $ 12.94 $ 9.47 $ 10.05 $ 9.14 $ 10.46
------------ -------- -------- -------- -------- --------
Income from investment operations
Net investment income (loss).................. (.14) (.13) (.04) (.05) -- .05
Net realized and unrealized gain (loss) on
investment and foreign currency
transactions................................ (.62) 1.72 3.51 (.53) 1.02 (1.10)
------------ -------- -------- -------- -------- --------
Total from investment operations........... (.76) 1.59 3.47 (.58) 1.02 (1.05)
------------ -------- -------- -------- -------- --------
Less distributions
Dividends from net investment income.......... -- -- -- -- (.07) (.18)
Distributions paid to shareholders from net
realized gains on investment and foreign
currency transactions....................... (.19) -- -- -- (.04) (.09)
------------ -------- -------- -------- -------- --------
Total distributions........................ (.19) -- -- -- (.11) (.27)
------------ -------- -------- -------- -------- --------
Net asset value, end of period................ $ 13.58 $ 14.53 $ 12.94 $ 9.47 $ 10.05 $ 9.14
============ ======== ======== ======== ======== ========
TOTAL RETURN#:................................ (5.23)% 12.29% 36.64% (5.77)% 11.29% (10.43)%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000)............... $245,619 $410,520 $251,133 $178,438 $249,582 $261,555
Average net assets (000)...................... $311,180 $345,771 $183,741 $210,464 $253,866 $328,467
Ratios to average net assets:
Expenses, including distribution fees...... 2.25%* 2.24% 2.24% 2.40% 2.44% 2.23%
Expenses, excluding distribution fees...... 1.32%* 1.30% 1.36% 1.51% 1.53% 1.37%
Net investment income (loss)............... (1.13)%* (0.97)% (0.39)% (0.47)% (0.01)% 0.51%
Portfolio turnover rate....................... 28% 49% 69% 58% 126% 35%
<CAPTION>
Class C
August 1,
Six Months 1994D
Ended Through
April 30, October 31,
1995 1994
------------ -----------
<S> <C> <C>
PER SHARE OPERATING PERFORMANCE (1):
Net asset value, beginning of period.......... $ 14.53 $ 14.03
------------ -----------
Income from investment operations
Net investment income (loss).................. (.06) (.03)
Net realized and unrealized gain (loss) on
investment and foreign currency
transactions................................ (.70) .53
------------ -----------
Total from investment operations........... (.76) .50
------------ -----------
Less distributions
Dividends from net investment income.......... -- --
Distributions paid to shareholders from net
realized gains on investment and foreign
currency transactions....................... (.19) --
------------ -----------
Total distributions........................ (.19) --
------------ -----------
Net asset value, end of period................ $ 13.58 $ 14.53
============ ===========
TOTAL RETURN#:................................ (5.23)% 3.56%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000)............... $ 2,050 $ 1,205
Average net assets (000)...................... $ 1,608 $ 630
Ratios to average net assets:
Expenses, including distribution fees...... 2.34%* 2.63%*
Expenses, excluding distribution fees...... 1.34%* 1.63%*
Net investment income (loss)............... (.99)% (1.21)%*
Portfolio turnover rate....................... 28% 49%
</TABLE>

- ---------------
* Annualized.
D Commencement of offering of Class C shares.
# Total return does not consider the effects of sales loads. Total return
is calculated assuming a purchase of shares on the first day and a sale
on the last day of each period reported and includes reinvestment of
dividends and distributions. Total returns for periods of less than a
full year are not annualized.
(1) Based on average shares outstanding, by class.

- --------------------------------------------------------------------------------
See Notes to Financial Statements. 15

<PAGE>

Prudential Global Fund, Inc.

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

Prospectus dated January 3, 1995

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

Prudential Global Fund, Inc. (the Fund) is an open-end, diversified management
investment company. Its investment objective is to seek long-term growth of
capital, with income as a secondary objective. The Fund seeks to achieve its
objective through investment in a diversified portfolio of securities which will
consist of marketable securities of U.S. and non-U.S. issuers. The Fund may
invest in all types of common stocks and equivalents (such as convertible debt
securities and warrants), preferred stocks, bonds and other debt obligations,
including money market instruments, of foreign and domestic companies and
governments, governmental agencies and international organizations. The Fund may
also invest in stock options, options on debt securities, options on stock
indices, stock index futures and options on stock index futures. There can be no
assurance that the Fund's investment objective will be achieved. See "How the
Fund Invests--Investment Objective and Policies". The Fund's address is One
Seaport Plaza, New York, New York 10292, and its telephone number is (800)
225-1852.

The Fund is not intended to constitute a complete investment program. The Fund
intends to pay annual dividends consisting of substantially all of its net
investment income and net short-term and long-term capital gains, if any.
Because of its objective and policies, including its international orientation,
the Fund may be considered of a speculative nature and subject to greater
investment risks than are assumed by certain other investment companies which
invest solely in domestic securities. See "How the Fund Invests--Special
Considerations and Risks".

This Prospectus sets forth concisely the information about the Fund that a
prospective investor should know before investing. Additional information about
the Fund has been filed with the Securities and Exchange Commission in a
Statement of Additional Information, dated January 3, 1995, which information
is incorporated herein by reference (is legally considered a part of this
Prospectus) and is available without charge upon request to the Fund, at the
address or telephone number noted above.

- --------------------------------------------------------------------------------
Investors are advised to read this Prospectus and retain it for future
reference.
- --------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

<PAGE>

FUND HIGHLIGHTS

The following summary is intended to highlight certain information
contained in this Prospectus and is qualified in its entirety by the more
detailed information appearing elsewhere herein.

What is Prudential Global Fund, Inc.?

Prudential Global Fund, Inc. is a mutual fund. A mutual fund pools the
resources of investors by selling its shares to the public and investing the
proceeds of such sale in a portfolio of securities designed to achieve its
investment objective. Technically, the Fund is an open-end, diversified
management investment company.

What is the Fund's Investment Objective?

The Fund's investment objective is to seek long-term growth of capital with
income as a secondary objective. The Fund seeks to achieve its objective through
investment in a diversified portfolio of marketable securities of U.S. and
non-U.S. issuers. There can be no assurance that the Fund's objective will be
achieved. See "How the Fund Invests--Investment Objective and Policies" at page
8.

Risk Factors and Special Characteristics

While the Fund is not required to maintain any particular geographic or
currency mix of its investments, under normal circumstances the Fund intends to
maintain investments in a minimum of four countries, which may include the
United States. The Fund may, from time to time, invest up to 65% of its assets
in companies and governments located in any one country. The Fund may invest in
all types of common stocks and equivalents, preferred stocks, bonds and other
debt obligations of foreign and domestic companies, governments, government
agencies and international organizations. See "How the Fund Invests--Investment
Objective and Policies" at page 8. Investing in securities of foreign companies
and countries involves certain considerations and risks not typically associated
with investing in U.S. Government Securities and those of domestic companies.
See "How the Fund Invests--Special Considerations and Risks" at page 14. The
Fund may also engage in hedging and income enhancement strategies, including
derivatives, the purchase and sale of put and call options, foreign currency
forward contracts, options and futures transactions and related short-term
trading. See "How the Fund Invests--Hedging and Income Enhancement Strategies"
at page 9.

Who Manages the Fund?

Prudential Mutual Fund Management, Inc. (PMF or the Manager) is the Manager
of the Fund and is compensated for its services at an annual rate of .75 of 1%
of the Fund's average daily net assets. As of November 30, 1994, PMF served as
manager or administrator to 66 investment companies, including 37 mutual
funds, with aggregate assets of approximately $47 billion. The Prudential
Investment Corporation (PIC or the Subadviser) furnishes investment advisory
services in connection with the management of the Fund under a Subadvisory
Agreement with PMF. See "How the Fund is Managed--Manager" at page 15. The
management fee is higher than that paid by most other investment companies.

Who Distributes the Fund's Shares?

Prudential Mutual Fund Distributors, Inc. (PMFD) acts as the Distributor of
the Fund's Class A shares and is paid an annual distribution and service fee
which is currently being charged at the rate of .25 of 1% of the average daily
net assets of the Class A shares.

Prudential Securities Incorporated (Prudential Securities or PSI), a major
securities underwriter and securities and commodities broker, acts as the
Distributor of the Fund's Class B and Class C shares and is paid an annual
distribution and service fee at the rate of up to 1% of the average daily net
assets of each of the Class B and Class C shares. See "How the Fund is
Managed--Distributor" at page 15.

2
<PAGE>

What is the Minimum Investment?

The minimum initial investment for Class A and Class B shares is $1,000 per
class and $5,000 for Class C shares. The minimum subsequent investment is $100
for all classes. There is no minimum investment requirement for certain
retirement and employee savings plans or custodial accounts for the benefit of
minors. For purchases made through the Automatic Savings Accumulation Plan the
minimum initial and subsequent investment is $50. See "Shareholder Guide--How
to Buy Shares of the Fund" at page 21 and "Shareholder Guide--Shareholder
Services" at page 29.

How Do I Purchase Shares?

You may purchase shares of the Fund through Prudential Securities, Pruco
Securities Corporation (Prusec) or directly from the Fund, through its transfer
agent, Prudential Mutual Fund Services, Inc. (PMFS or the Transfer Agent) at the
net asset value per share (NAV) next determined after receipt of your purchase
order by the Transfer Agent or Prudential Securities plus a sales charge which
may be imposed either (i) at the time of purchase (Class A shares) or (ii) on a
deferred basis (Class B or Class C shares). See "How The Fund Values Its Shares"
at page 18 and "Shareholder Guide--How to Buy Shares of the Fund" at page 21.

What Are My Purchase Alternatives?

The Fund offers three classes of shares:

o Class A Shares: Sold with an initial sales charge of up to 5% of the
offering price.

o Class B Shares: Sold without an initial sales charge but are subject
to a contingent deferred sales charge or CDSC (declining from 5% to
zero of the lower of the amount invested or the redemption proceeds)
which will be imposed on certain redemptions made within six years of
purchase. Although Class B shares are subject to higher ongoing
distribution-related expenses than Class A shares, Class B shares will
automatically convert to Class A shares (which are subject to lower
ongoing distribution-related expenses) approximately seven years after
purchase.

o Class C Shares: Sold without an initial sales charge and, for one year
after purchase, are subject to a 1% CDSC on redemptions. Like Class B
shares, Class C shares are subject to higher ongoing
distribution-related expenses than Class A shares but do not convert
to another class.

See "Shareholder Guide--Alternative Purchase Plan" at page 22.

How Do I Sell My Shares?

You may redeem shares at any time at the NAV next determined after
Prudential Securities or the Transfer Agent receives your sell order. However,
the proceeds of redemptions of Class B and Class C shares may be subject to a
CDSC. See "Shareholder Guide--How to Sell Your Shares" at page 24.

How are Dividends and Distributions Paid?

The Fund expects to pay dividends of net investment income and make
distributions of any net capital gains at least annually. Dividends and
distributions will be automatically reinvested in additional shares of the Fund
at NAV without a sales charge unless you request that they be paid to you in
cash. See "Taxes, Dividends and Distributions" at page 19.

3
<PAGE>

FUND EXPENSES
<TABLE>
<CAPTION>

Class A Shares Class B Shares Class C Shares
-------------- -------------- --------------
<S> <C> <C> <C>
Shareholder Transactions Expenses+
Maximum Sales Load Imposed on Purchases (as a
percentage of offering price) .................................. 5% None None
Maximum Sales Load or Deferred Sales Load Imposed on
Reinvested Dividends ............................................ None None None
Deferred Sales Load (as a percentage of original purchase
price or redemption proceeds, whichever is lower) ............. None 5% during the first year, 1% on redemptions
decreasing by 1% annually made within one
to 1% in the fifth and sixth year of purchase
years and 0% the seventh
year*
Redemption Fees .................................................. None None None
Exchange Fees .................................................... None None None

Annual Fund Operating Expenses
(as a percentage of average net assets) Class A Shares Class B Shares Class C Shares**
-------------- -------------- ----------------
Management Fees .................................................. .75% .75% .75%
12b-1 Fees ....................................................... .25%++ .94% 1.00%**
Other Expenses ................................................... .55% .55% .88%
---- ---- ----
Total Fund Operating Expenses .................................... 1.55% 2.24% 2.63%
==== ==== ====

</TABLE>

<TABLE>
<CAPTION>
1 3 5 10
Example Year Years Years Years
----- ----- ----- -----
<S> <C> <C> <C> <C>
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each time period:
Class A .......................................................................... $ 65 $ 97 $130 $225
Class B .......................................................................... $ 73 $100 $130 $232
Class C** ........................................................................ $ 37 $ 82 $140 $296
You would pay the following expenses on the same investment, assuming no redemption:
Class A .......................................................................... $ 65 $ 97 $130 $225
Class B .......................................................................... $ 23 $ 70 $120 $232
Class C** ........................................................................ $ 37 $ 82 $140 $296
</TABLE>

The above example with respect to Class A and Class B shares is based on
restated data for the Fund's fiscal year ended October 31, 1994. The above
example with respect to Class C shares is based on expenses expected to have
been incurred if Class C shares had been in existence during the entire fiscal
year ended October 31, 1994. The example should not be considered a
representation of past or future expenses. Actual expenses may be greater or
less than those shown.

The purpose of this table is to assist investors in understanding the various
costs and expenses that an investor in the Fund will bear, whether directly or
indirectly. For more complete descriptions of the various costs and expenses,
see "How the Fund is Managed". "Other Expenses" includes operating expenses of
the Fund such as directors' and professional fees, registration fees, reports to
shareholders, transfer agency and custodian fees and franchise taxes.
- ----------
* Class B shares will automatically convert to Class A shares approximately
seven years after purchase. See "Shareholder Guide--Conversion
Feature--Class B Shares".

** Estimated based on expenses expected to have been incurred if Class C
shares had been in existence during the entire fiscal year ended October
31, 1994.

+ Pursuant to rules of the National Association of Securities Dealers, Inc.,
the aggregate initial sales charges, deferred sales charges and asset-based
sales charges on shares of the Fund may not exceed 6.25% of total gross
sales, subject to certain exclusions. This 6.25% limitation is imposed on
the Fund rather than on a per shareholder basis. Therefore long-term
shareholders of the Fund may pay more in total sales charges than the
economic equivalent of 6.25% of such shareholders' investment in such
shares. See "How the Fund is Managed--Distributor".

++ Although the Class A Distribution and Service Plan provides that the Fund
may pay up to an annual rate of .30 of 1% of the average daily net assets
of the Class A shares, the Distributor has agreed to limit its distribution
fees with respect to Class A shares of the Fund to .25 of 1% of the average
daily net asset value of the Class A shares for the fiscal year ending
October 31, 1995. Total operating expenses without such limitation would be
1.60%. See "How the Fund is Managed--Distributor".

4
<PAGE>

FINANCIAL HIGHLIGHTS
(for a share outstanding throughout each of the indicated periods)
(Class A Shares)

The following financial highlights have been audited by Deloitte & Touche
LLP, independent accountants, whose report thereon was unqualified. This
information should be read in conjunction with the financial statements and
notes thereto, which appear in the Statement of Additional Information. The
following financial highlights contain selected data for a Class A share of
common stock outstanding, total return, ratios to average net assets and other
supplemental data for the periods indicated. The information is based on data
contained in the financial statements.

<TABLE>
<CAPTION>
Class A
----------------------------------------------------------------
January 22,
1990+
Year Ended October 31, through
--------------------------------------------- October 31,
1994 1993 1992 1991 1990
------- ------- ------- ------- ------------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE(1):
Net asset value, beginning of period ............................ $ 13.17 $ 9.58 $ 10.08 $ 9.19 $ 10.38
------- ------- ------- ------- --------
Income from investment operations:
Net investment income (loss) .................................... (.04) 0.02 0.03 0.07 0.12
Net realized and unrealized gain (loss) on investment and foreign
currency transactions .......................................... 1.76 3.57 (.53) 1.02 (1.31)
------- ------- ------- ------- --------
Total from investment operations ................................ 1.72 3.59 (.50) 1.09 (1.19)
------- ------- ------- ------- --------
Less distributions:
Dividends from net investment income ............................ -- -- -- (0.16) --
Distributions from net realized gains on investment and foreign
currency transactions .......................................... -- -- -- (0.04)
------- ------- ------- ------- --------
Total distributions ............................................. -- -- -- (0.20) --
------- ------- ------- ------- --------
Net asset value, end of period .................................. $ 14.89 $ 13.17 $ 9.58 $ 10.08 $ 9.19
======= ======= ======= ======= ========
TOTAL RETURN*** ................................................. 13.06% 37.47% (4.96)% 12.11% (11.46)%

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000) ................................. $73,815 $42,021 $13,973 $14,154 $8,727
Average net assets (000) ........................................ $58,455 $21,409 $14,758 $10,593 $7,151
Ratios to average net assets:
Expenses, including distribution fees .......................... 1.55%* 1.56% 1.71% 1.72% 1.57%*
Expenses, excluding distribution fees .......................... 1.30%* 1.36% 1.51% 1.52% 1.37%*
Net investment income (loss) ................................... (0.29)%* 0.20% 0.22% 0.65% 1.61%*
Portfolio turnover rate ......................................... 49% 69% 58% 126% 35%
<FN>
- -----------
* Annualized.
+ Commencement of offering of Class A shares.
*** Total return does not consider the effects of sales loads. Total return is
calculated assuming a purchase of shares on the first day and a sale on the
last day of each period reported and includes reinvestment of dividends and
distributions. Total returns for periods of less than a full year are not
annualized.
(1) Based on average month-end shares outstanding.

</FN>
</TABLE>

5
<PAGE>

FINANCIAL HIGHLIGHTS
(for a share outstanding throughout each of the indicated periods)
(Class B Shares)

The following financial highlights for the five years ended October 31,
1994 have been audited by Deloitte & Touche LLP, independent accountants, whose
report thereon was unqualified. This information should be read in conjunction
with the financial statements and notes thereto, which appear in the Statement
of Additional Information. The following financial highlights contain selected
data for a Class B share of common stock outstanding, total return, ratios to
average net assets and other supplemental data for the periods indicated. The
information is based on data contained in the financial statements.

Class B
-----------------------------
Year ended October 31,
-----------------------------
1994(1) 1993(1) 1992(1)
------ ------ ------
<S> <C> <C> <C>
PER SHARE OPERATING
PERFORMANCE(1):
Net asset value, beginning of period . $12.94 $ 9.47 $10.05
------ ------ ------
Income from investment operations:
Net investment income (loss) ......... (.13) (0.04) (0.05)
Net realized and unrealized gain (loss)
on investment and foreign currency
transactions ....................... 1.72 3.51 (0.53)
------ ------ ------
Total from investment operations ..... 1.59 3.47 (0.58)
------ ------ ------
Less distributions:
Dividends from net investment
income ............................. -- -- --
Distributions paid to shareholders from
net realized gains on investment
and foreign currency transactions .. -- -- --
------ ------ ------
Total distributions .................. -- -- --
------ ------ ------
Net asset value, end of period ....... $14.53 $12.94 $ 9.47
====== ====== ======
TOTAL RETURN*** ...................... 12.29% 36.64% (5.77)%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000) ...... $410,520 $251,133 $178,438
Average net assets (000) ............. $345,771 $183,741 $210,464
Ratios to average net assets:
Expenses, including distribution
fees ............................. 2.24% 2.24% 2.40%
Expenses, excluding distribution
fees ............................. 1.31% 1.36% 1.51%
Net investment income (loss) ....... (0.97)% (.39)% (0.47)%
Portfolio turnover rate .............. 49% 69% 58%

</TABLE>

<TABLE>
<CAPTION>
Class B
-------------------------------------------------------------------
Year ended October 31,
-------------------------------------------------------------------
1991(1) 1990(1) 1989(1) 1988(1)** 1987(1) 1986(1) 1985*
------ ------ ------ ------ ----- ----- -----

<S> <C> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING
PERFORMANCE(1):
Net asset value, beginning of period . $ 9.14 $10.46 $10.09 $ 9.86 $9.96 $6.95 $5.23
------ ------ ------ ------ ----- ----- -----
Income from investment operations:
Net investment income (loss) ......... -- 0.05 0.15 0.17+ 0.06 (0.01)+ 0.08+
Net realized and unrealized gain (loss)
on investment and foreign currency
transactions ....................... 1.02 (1.10) 0.53 1.11 0.79 3.23 1.72
------ ------ ------ ------ ----- ----- -----
Total from investment operations ..... 1.02 (1.05) 0.68 1.28 0.85 3.22 1.80
------ ------ ------ ------ ----- ----- -----
Less distributions:
Dividends from net investment
income ............................. (0.07) (0.18) (0.19) (0.07) -- (0.02) (0.05)
Distributions paid to shareholders from
net realized gains on investment
and foreign currency transactions .. (0.04) (0.09) (0.12) (0.98) (0.95) (0.19) (0.03)
------ ------ ------ ------ ----- ----- -----
Total distributions .................. (0.11) (0.27) (0.31) (1.05) (0.95) (0.21) (0.08)
------ ------ ------ ------ ----- ----- -----
Net asset value, end of period ....... $10.05 $ 9.14 10.46 $10.09 $9.86 $9.96 $6.95
====== ====== ====== ====== ===== ===== =====
TOTAL RETURN*** ...................... 11.29% (10.43)% 6.92% 13.58% 8.81% 46.45% 34.93%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000) ...... $249,582 $261,555 $385,578 $523,743 $628,542 $376,839 $61,673
Average net assets (000) ............. $253,866 $328,467 $448,737 $571,420 $697,486 $238,239 $26,087
Ratios to average net assets:
Expenses, including distribution
fees ............................. 2.44% 2.23% 1.82% 1.86%+ 1.96% 1.89%+ 2.07%+
Expenses, excluding distribution
fees ............................. 1.53% 1.37% 1.34% 1.17%+ 1.14% 1.03%+ 1.39%+
Net investment income (loss) ....... (0.01)% 0.51% 1.45% 1.71%+ 0.52% (0.13)%+ 1.81%+
Portfolio turnover rate .............. 126% 35% 60% 82% 135% 80% 123%
- -----------
<FN>
* Adjusted for 2-for-1 stock split paid to shareholders of record on May 15,
1986.
** On March 1, 1988, Prudential Mutual Fund Management, Inc. succeeded The
Prudential Insurance Company of America as investment adviser and since
then has acted as manager of the Fund. See "Manager" in the Statement of
Additional Information.
*** Total return does not consider the effects of sales loads. Total return is
calculated assuming a purchase of shares on the first day and a sale on the
last day of each period reported and includes reinvestment of dividends and
distributions. Total returns for periods of less than a full year are not
annualized.
+ Net of expense subsidy or reimbursement.
(1) Based on average month-end shares outstanding.
</FN>
</TABLE>

<PAGE>

FINANCIAL HIGHLIGHTS
(for a share outstanding throughout the indicated period)
(Class C Shares)

The following financial highlights have been audited by Deloitte & Touche
LLP, independent accountants, whose report thereon was unqualified. This
information should be read in conjunction with the financial statements and
notes thereto, which appear in the Statement of Additional Information. The
following financial highlights contain selected data for a Class C share of
common stock outstanding, total return, ratios to average net assets and other
supplemental data for the period indicated. The information is based on data
contained in the financial statements.
<TABLE>
<CAPTION>

Class C
----------------
August 1, 1994*
through
October 31, 1994
----------------
<S> <C>

PER SHARE OPERATING PERFORMANCE(1):
Net asset value, beginning of period ......................... $ 12.94

Income from investment operations:
Net investment loss .......................................... (.03)
Net realized and unrealized gain on investment
and foreign currency transactions .......................... 1.62
-------
Total from investment operations ............................. 1.59

Net asset value, end of period ............................... $ 14.53
=======

TOTAL RETURN*** .............................................. 3.56%

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000) .............................. $ 1,205
Average net assets (000) ..................................... $ 630
Ratios to average net assets: #
Expenses, including distribution fees ...................... 2.63%**
Expenses, excluding distribution fees ...................... 1.63%**

Net investment income (loss) ............................... (1.21)%**
Portfolio turnover rate ...................................... 49%
<FN>
- ----------
* Commencement of offering of Class C shares.
** Annualized.
*** Total return does not consider the effects of sales loads. Total return is
calculated assuming a purchase of shares on the first day and a sale on the
last day of the period reported and includes reinvestment of dividends and
distributions. Total return for the period less than a full year is not
annualized.
# Because of the event referred to in * and the timing of such, the ratios
for Class C shares are not necessarily comparable to that of Class A and
Class B shares and are not necessarily indicative of future ratios.
(1) Based on average month-end shares outstanding.
</FN>
</TABLE>

<PAGE>

HOW THE FUND INVESTS

INVESTMENT OBJECTIVE AND POLICIES

The investment objective of the Fund is to seek long-term growth of
capital, with income as a secondary objective. The Fund will seek to achieve its
objectives through investment in a diversified portfolio of securities which
will consist of marketable securities of U.S. and non-U.S. issuers. Marketable
securities are those for which market quotations are readily available. There
can be no assurance that the Fund will achieve its investment objectives. See
"Investment Objective and Policies" in the Statement of Additional Information.

The Fund's investment objective is a fundamental policy and may not be
changed without the approval of the holders of a majority of the Fund's
outstanding voting securities as defined in the Investment Company Act of 1940
(the Investment Company Act). Fund policies that are not fundamental may be
modified by the Board of Directors.

The Fund may invest in all types of common stocks and equivalents (such as
convertible debt securities and warrants), preferred stocks, bonds and other
debt obligations, including money market instruments, of foreign and domestic
companies and governments, governmental agencies and international
organizations. The Fund may also invest in stock options, options on debt
securities, options on stock indices, stock index futures and options on stock
index futures.

Although the Fund is not required to maintain any particular geographic or
currency mix of its investments, nor required to maintain any particular
proportion of stocks, bonds or other securities in its portfolio, the Fund, in
view of its investment objective, presently expects to invest its assets
primarily in common stocks of U.S. and non-U.S. issuers. The Fund may, however,
invest substantially or primarily in debt securities of U.S. and non-U.S.
issuers when it appears that the capital appreciation available from investments
in such securities will equal or exceed the capital appreciation available from
investments in equity securities, or when the Fund is temporarily in a defensive
position. The Fund will purchase "investment grade" debt including convertible
debt obligations. Investment grade debt obligations are bonds rated within the
four highest quality grades as determined by Moody's Investors Service (Moody's)
(currently Aaa, Aa, A and Baa for bonds, MIG1, MIG2, MIG3 and MIG4 for notes and
P-1 for commercial paper), or Standard & Poor's Ratings Group (S&P) (currently
AAA, AA, A and BBB for bonds, SP-1 and SP-2 for notes and A-1 for commercial
paper), or by another nationally recognized statistical rating organization
(NRSRO) or in unrated securities of equivalent quality. Securities rated Baa by
Moody's or BBB by S&P, although considered to be investment grade, lack
outstanding investment characteristics and, in fact, have speculative
characteristics. Lower rated securities are subject to a greater risk of loss of
principal and interest. Debt securities may be subject to price volatility due
to such factors as interest rate sensitivity, market perception of the
creditworthiness of the issuer and general market liquidity (market risk).
Moreover, should extraordinary market conditions warrant, the Fund may
temporarily be invested primarily in securities of U.S. issuers.

The Fund is intended to provide investors with the opportunity to invest in
a portfolio of securities of companies and governments located throughout the
world. In making the allocation of assets among the various countries and
geographic regions, the Fund's investment adviser ordinarily considers such
factors as prospects for relative economic growth between foreign countries;
expected levels of inflation and interest rates; government policies influencing
business conditions; the range of individual investment opportunities available
to international investors; and other pertinent financial, tax, social,
political and national factors--all in relation to the prevailing prices of the
securities in each country or region.

Investments may be made in companies based in (or governments of or within)
the Pacific Basin (such as Japan, Australia, Singapore, Malaysia and Hong Kong)
and Western Europe (such as the United Kingdom, Germany, Switzerland, the
Netherlands, France, Belgium, Spain and Scandinavia), as well as the United
States, Canada and such other areas and countries as the investment adviser may
determine from time to time. The Fund intends to maintain investments in a
minimum of four countries, which may include the United States, but may, from
time to time, invest up to 65% of its assets in companies and governments
located in any one country.

8
<PAGE>

The Fund may invest in securities not listed on securities exchanges. These
securities will generally have an established market (such as the
over-the-counter market), the depth and liquidity of which may vary from time to
time and from security to security. In addition, the Fund may invest to a
limited extent in securities of companies which have been in existence for less
than three years, in securities for which market quotations are not readily
available and in securities of other registered investment companies. See
"Investment Restrictions" in the Statement of Additional Information.

In analyzing companies for investment, the investment adviser ordinarily
looks for one or more of the following characteristics: prospects for
above-average earnings growth per share; high return on invested capital;
healthy balance sheet; sound financial and accounting policies and overall
financial strength; strong competitive advantages; effective research and
product development and marketing; efficient service; pricing flexibility;
strength of management; and general operating characteristics which will enable
the companies to compete successfully in their marketplace--all in relation to
the prevailing prices of the securities of such companies.

HEDGING AND INCOME ENHANCEMENT STRATEGIES

The Fund may also engage in various portfolio strategies, including
derivatives, to reduce certain risks of its investments and to attempt to
enhance income. These strategies include the purchase and sale of put and call
options, and the purchase and sale of stock index futures and combinations
thereof. The Manager will use such techniques as market conditions warrant. The
Fund's ability to use these strategies may be limited by market conditions,
regulatory limits and tax considerations and there can be no assurance that any
of these strategies will succeed. See "Investment Objective and Policies" in the
Statement of Additional Information. New financial products and risk management
techniques continue to be developed and the Fund may use these new investments
and techniques to the extent consistent with its investment objective and
policies.

Options Transactions

Exchange-Traded Options. The Fund may purchase and write (i.e., sell)
exchange traded put and call options on equity securities, debt securities or
stock indices.

A call option on equity securities gives the purchaser, in exchange for a
premium paid, the right for a specified period of time to purchase the
securities subject to the option at a specified price (the "exercise price" or
"strike price"). The writer of a call option, in return for the premium, has the
obligation, upon exercise of the option, to deliver, depending upon the terms of
the option contract, the underlying securities to the purchaser upon receipt of
the exercise price. When the Fund writes a call option, the Fund gives up the
potential for gain on the underlying securities in excess of the exercise price
of the option during the period that the option is open.

A put option on equity securities gives the purchaser, in return for a
premium, the right, for a specified period of time, to sell the securities
subject to the option to the writer of the put at the specified exercise price.
The writer of the put option, in return for the premium, has the obligation,
upon exercise of the option, to acquire the securities underlying the option at
the exercise price. The Fund as the writer of a put option might, therefore, be
obligated to purchase underlying securities for more than their current market
price.

Options on stock indices are similar to options on equity securities except
that, rather than the right to take or make delivery of stock at a specified
price, an option on a stock index gives the holder the right, in return for a
premium paid, to receive, upon exercise of the option, an amount of cash if the
closing level of the stock index upon which the option is based is greater than,
in the case of a call, or less than, in the case of a put, the exercise price of
the option. The writer of an index option, in return for the premium, is
obligated to pay the amount of cash due upon exercise of the option.

The Fund will write only "covered" options. An option is covered if the
Fund, so long as it is obligated under the option, owns an offsetting position
in the underlying securities or maintains cash, U.S. Government securities or
other liquid high-grade debt obligations with a value sufficient at all times to
cover its obligations in a segregated account. See "Investment Objective and
Policies--Limitations on Purchase and Sale of Stock Options, Options on Stock
Indices and Stock Index Futures" in the Statement of Additional Information.

<PAGE>

There is no limitation on the amount of call options the Fund may write.
The Fund may only write covered put options to the extent that cover for such
options does not exceed 25% of the Fund's net assets. The Fund will not purchase
an option if, as a result of such purchase, more than 20% of its total assets
would be invested in premiums for such options.

Over-the-Counter Options. The Fund may also purchase and write (i.e., sell)
put and call options on equity and debt securities and on stock indexes in the
over-the-counter market (OTC options). Unlike exchange-traded options, OTC
options are contracts between the Fund and its counterparty without the
interposition of any clearing organization. Thus, the value of an OTC option is
particularly dependent on the financial viability of the OTC counterparty. The
Fund's ability to purchase and write OTC options may be limited by market
conditions, regulatory limits and tax considerations. There are certain risks
associated with investments in OTC options. See "Investment Objective and
Policies--Special Risks of Purchasing OTC Options" in the Statement of
Additional Information.

Stock Index Futures

The Fund may purchase and sell stock index futures which are traded on a
commodities exchange or board of trade for certain hedging and risk management
purposes in accordance with regulations of the Commodity Futures Trading
Commission.

A stock index futures contract is an agreement in which one party agrees to
deliver to another an amount of cash equal to a specific dollar amount times the
difference between a specific stock index at the close of the last trading day
of the contract and the price at which the agreement is made. No physical
delivery of the underlying stocks in the index is made. The Fund may not
purchase or sell stock index futures if, immediately thereafter, more than
one-third of its net assets would be hedged. In addition, except in the case of
a call written and held on the same index, the Fund will write call options on
indices or sell stock index futures only if the amount resulting from the
multiplication of the then current level of the index (or indices) upon which
the options or futures contract(s) is based, the applicable multiplier(s), and
the number of futures or options contracts which would be outstanding would not
exceed one-third of the value of the Fund's net assets. The Fund also may not
purchase or sell stock index futures for risk management purposes if immediately
thereafter the sum of the amount of margin deposits on the Fund's existing
futures positions and premiums paid for such options would exceed 5% of the
liquidation value of the Fund's total assets. The Fund may purchase and sell
stock index futures, without limitation, for bona fide hedging purposes.

The Fund's successful use of stock index futures contracts and options on
indices depends upon its ability to predict the direction of the market
underlying the index and is subject to various additional risks. The correlation
between movements in the price of the stock index future and the price of the
securities being hedged is imperfect and there is a risk that the value of the
securities being hedged may increase or decrease at a greater rate than the
related futures contract, resulting in losses to the Fund. Certain futures
exchanges or boards of trade have established daily limits on the amount that
the price of a futures contract or related options may vary, either up or down,
from the previous day's settlement price. These daily limits may restrict the
Fund's ability to purchase or sell certain futures contracts or related options
on any particular day. In addition, if the Fund purchases futures to hedge
against market advances before it can invest in common stock in an advantageous
manner and the market declines, the Fund might create a loss on the futures
contract. In addition, the ability of the Fund to close out a futures position
or an option depends on a liquid secondary market. There is no assurance that
liquid secondary markets will exist for any particular futures contract or
option at any particular time. See "Investment Objective and Policies" in the
Statement of Additional Information.

The Fund's ability to enter into stock index futures and listed options is
limited by the requirements of the Internal Revenue Code of 1986, as amended
(the Internal Revenue Code), for qualification as a regulated investment
company. See "Taxes" in the Statement of Additional Information.

Risks of Hedging and Income Enhancement Strategies

Participation in the options or futures markets involves investment risks
and transaction costs to which the Fund would not be subject absent the use of
these strategies. If the investment adviser's prediction of movements in the
direction of

<PAGE>

the securities markets is inaccurate, the adverse consequences to the Fund
may leave the Fund in a worse position than if such strategies were not used.
Risks inherent in the use of options and stock index futures include (1)
dependence on the investment adviser's ability to predict correctly movements in
the direction of specific securities being hedged or the movement in stock
indices; (2) imperfect correlation between the price of options and stock index
futures and options thereon and movements in the prices of the securities being
hedged; (3) the fact that skills needed to use these strategies are different
from those needed to select portfolio securities; (4) the possible absence of a
liquid secondary market for any particular instrument at any time; (5) the
possible need to defer closing out certain hedged positions to avoid adverse tax
consequences; and (6) the possible inability of the Fund to purchase or sell a
portfolio security at a time that otherwise would be favorable for it to do so,
or the possible need for the Fund to sell a portfolio security at a
disadvantageous time, due to the need for the Fund to maintain "cover" or to
segregate securities in connection with hedging transactions. See "Investment
Objective and Policies" and "Taxes" in the Statement of Additional Information.

Forward Foreign Currency Exchange Contracts

A forward foreign currency exchange contract involves an obligation to
purchase or sell a specific currency at a future date, which may be any fixed
number of days from the date of the contract agreed upon by the parties, at a
price set at the time of the contract. These contracts are traded in the
interbank market conducted directly between currency traders (typically large
commercial banks) and their customers. A forward contract generally has no
deposit requirements, and no commissions are charged for such trades. See
"Investment Objective and Policies--Forward Foreign Currency Exchange Contracts"
in the Statement of Additional Information.

When the Fund invests in foreign securities, the Fund may enter into
forward contracts in several circumstances to protect the value of its
portfolio. The Fund may not use forward contracts to generate income, although
the use of such contracts may incidentally generate income. There is no
limitation on the value of forward contracts into which the Fund may enter.
However, the Fund's dealings in forward contracts will be limited to hedging
involving either specific transactions or portfolio positions. Transaction
hedging is the purchase or sale of a forward contract with respect to specific
receivables or payables of the Fund generally arising in connection with the
purchase or sale of its portfolio securities and accruals of interest or
dividends receivable and Fund expenses. Position hedging is the sale of a
foreign currency with respect to portfolio security positions denominated or
quoted in that currency. The Fund will not speculate in forward contracts. The
Fund may not position hedge with respect to a particular currency for an amount
greater than the aggregate market value (determined at the time of making any
sale of a forward contract) of securities held in its portfolio denominated or
quoted in, or currently convertible into, such currency.

When the Fund enters into a contract for the purchase or sale of a security
denominated in a foreign currency, or when the Fund anticipates the receipt in a
foreign currency of dividends or interest payments on a security which it holds,
the Fund may desire to "lock in" the U.S. dollar price of the security or the
U.S. dollar equivalent of such dividend or interest payment, as the case may be.
By entering into a forward contract for a fixed amount of dollars for the
purchase or sale of the amount of foreign currency involved in the underlying
transaction, the Fund will be able to protect itself against a possible loss
resulting from an adverse change in the relationship between the U.S. dollar and
the subject foreign currency during the period between the date on which the
security is purchased or sold, or on which the dividend or interest payment is
declared, and the date on which such payments are made or received.
Additionally, when the investment adviser believes that the currency of a
particular foreign country may suffer a substantial decline against the U.S.
dollar, the Fund may enter into a forward contract, for a fixed amount of
dollars, to sell the amount of foreign currency approximating the value of some
or all of the portfolio securities of the Fund denominated in such foreign
currency. Requirements under the Internal Revenue Code for qualification as a
regulated investment company may limit the Fund's ability to engage in
transactions in forward contracts. See "Taxes" in the Statement of Additional
Information.

Futures Contracts On Foreign Currencies and Options On Futures Contracts

The Fund may buy and sell futures contracts on foreign currencies and
groups of foreign currencies (futures contracts) such as the European Currency
Unit and related options thereon solely for hedging purposes. A European
Currency Unit is a basket of specified amounts of the currencies of certain
member states of the European Union, a Western European economic cooperative
organization including, inter alia, France, Germany, the Netherlands and the
United Kingdom. The Fund will

11
<PAGE>

engage in transactions in only those futures contracts and options thereon
that are traded on a commodities exchange or a board of trade. A "sale" of a
futures contract means the assumption of a contractual obligation to deliver the
specified amount of foreign currency at a specified price in a specified future
month. A "purchase" of a futures contract means the assumption of a contractual
obligation to acquire the currency called for by the contract at a specified
price in a specified future month. At the time a futures contract is purchased
or sold, the Fund must allocate cash or securities as a deposit payment (initial
margin). Thereafter, the futures contract is valued daily and the payment of
"variation margin" may be required, resulting in the Fund's providing or
receiving cash that reflects any decline or increase in the contract's value, a
process known as "marking to market".

The Fund intends to engage in futures contracts on foreign currencies and
options on these futures transactions as a hedge against changes in the value of
the currencies to which the Fund is subject or to which the Fund expects to be
subject in connection with future purchases, in accordance with the rules and
regulations of the Commodity Futures Trading Commission (the CFTC). The Fund
also intends to engage in such transactions when they are economically
appropriate for the reduction of risks inherent in the ongoing management of the
Fund.

Options On Foreign Currencies

The Fund may purchase and write put and call options on foreign currencies
traded on securities exchanges or boards of trade (foreign and domestic) for
hedging purposes in a manner similar to that in which forward foreign currency
exchange contracts and futures contracts on foreign currencies will be employed.
Options on foreign currencies are similar to options on stock, except that the
Fund has the right to take or make delivery of a specified amount of foreign
currency, rather than stock.

The Fund may purchase and write options to hedge the Fund's portfolio
securities denominated in foreign currencies. If there is a decline in the
dollar value of a foreign currency in which the Fund's portfolio securities are
denominated, the dollar value of such securities will decline even though the
foreign currency value remains the same. See "Special Considerations and Risks"
below. To hedge against the decline of the foreign currency, the Fund may
purchase put options on such foreign currency. If the value of the foreign
currency declines, the gain realized on the put option would offset, in whole or
in part, the adverse effect such decline would have on the value of the
portfolio securities. Alternatively, the Fund may write a call option on the
foreign currency. If the value of the foreign currency declines, the option
would not be exercised and the decline in the value of the portfolio securities
denominated in such foreign currency would be offset in part by the premium the
Fund received for the option.

If, on the other hand, the investment adviser anticipates purchasing a
foreign security and also anticipates a rise in the value of such foreign
currency (thereby increasing the cost of such security), the Fund may purchase
call options on the foreign currency. The purchase of such options could offset,
at least partially, the effects of the adverse movements of the exchange rates.
Alternatively, the Fund could write a put option on the currency and, if the
exchange rates move as anticipated, the option would expire unexercised.

Risks of Investing In Foreign Currency, Forward Contracts, Options and Futures

The Fund's successful use of forward foreign currency exchange contracts,
options on foreign currencies, futures contracts on foreign currencies and
options on such contracts depends upon the investment adviser's ability to
predict the direction of the market and political conditions, which requires
different skills and techniques than predicting changes in the securities
markets generally. For instance, if the value of the securities being hedged
moves in a favorable direction, the advantage to the Fund would be wholly or
partially offset by a loss in the forward contracts or futures contracts.
Further, if the value of the securities being hedged does not change, the Fund's
net income would be less than if the Fund had not hedged since there are
transactional costs associated with the use of these investment practices.

These practices are subject to various additional risks. The correlation
between movements in the price of options and futures contracts and the price of
the currencies being hedged is imperfect. The use of these instruments will
hedge only the currency risks associated with investments in foreign securities,
not market risks. In addition, if the Fund purchases these instruments to hedge
against currency advances before it invests in securities denominated in such
currency and the currency market declines, the Fund might incur a loss on the
futures contract. The Fund's ability to establish and maintain positions will
depend on market liquidity. The ability of

12
<PAGE>

the Fund to close out a futures position or an option depends upon a liquid
secondary market. There is no assurance that liquid secondary markets will exist
for any particular futures contract or option at any particular time. See "Risks
of Transactions in Options" and "Risks of Transactions in Futures Contracts"
under "Investment Objective and Policies" in the Statement of Additional
Information.

Limitations On Options and Futures Contracts

The Fund will not (a) write puts having aggregate exercise prices greater
than 25% of total assets, or (b) purchase (i) put options on foreign currencies
or (ii) call options on foreign currencies if, after any such purchase, the
aggregate premiums paid for such options would exceed 10% of the Fund's total
assets. There are no other limitations on the amount of foreign currencies that
may be hedged, and no limitations on the use of assets to cover options, except
that the aggregate value of the obligations underlying put options will not
exceed 50% of the Fund's assets. Requirements for qualification as a regulated
investment company under the Internal Revenue Code may limit the Fund's ability
to engage in transactions in options on foreign currencies. See "Taxes" in the
Statement of Additional Information.

OTHER INVESTMENT PRACTICES
Repurchase Agreements

The Fund may on occasion enter into repurchase agreements, whereby the
seller of a security agrees to repurchase that security from the Fund at a
mutually agreed-upon time and price. The repurchase date is usually within a day
or two of the original purchase, although it may extend over a number of months.
The resale price is in excess of the purchase price, reflecting an agreed-upon
rate of return effective for the period of time the Fund's money is invested in
the security. The Fund's repurchase agreements will at all times be fully
collateralized in an amount at least equal to the purchase price including
accrued interest earned on the underlying securities. The instruments held as
collateral are valued daily, and, as the value of instruments declines, the Fund
will require additional collateral. If the seller defaults and the value of the
collateral securing the repurchase agreement declines, the Fund may incur a
loss. The Fund participates in a joint repurchase account with other investment
companies managed by Prudential Mutual Fund Management, Inc. pursuant to an
order of the Securities and Exchange Commission (SEC). The Fund may invest up to
5% of its net assets in illiquid securities including repurchase agreements
which have a maturity of longer than seven days, securities with legal or
contractual restrictions on resale (restricted securities) and securities that
are not readily marketable. Restricted securities eligible for resale pursuant
to Rule 144A under the Securities Act of 1933, as amended (the Securities Act),
that have a readily available market are not considered illiquid for purposes of
this limitation. The investment adviser will monitor the liquidity of such
restricted securities under the supervision of the Board of Directors.
Repurchase agreements subject to demand are deemed to have a maturity equal to
the applicable notice period.

Illiquid Securities

The Fund may invest up to 5% of its net assets in illiquid securities,
including repurchase agreements which have a maturity of longer than seven days,
securities with legal or contractual restrictions on resale (restricted
securities) and securities that are not readily marketable. Restricted
securities eligible for resale pursuant to Rule 144A under the Securities Act
and privately placed commercial paper that have a readily available market are
not considered illiquid for purposes of this limitation. The investment adviser
will monitor the liquidity of such restricted securities under the supervision
of the Board of Directors. Repurchase agreements subject to demand are deemed to
have a maturity equal to the applicable notice period.

The staff of the SEC has taken the position that purchased over-the-counter
options and the assets used as "cover" for written over-the-counter options are
illiquid securities unless the Fund and the counterparty have provided for the
Fund, at the Fund's election, to unwind the over-the-counter option. The
exercise of such an option ordinarily would involve the payment by the Fund of
an amount designed to reflect the counterparty's economic loss from an early
termination, but does allow the Fund to treat the assets used as "cover" as
"liquid."

Securities Lending

The Fund may lend its portfolio securities to brokers or dealers, banks or
other recognized institutional borrowers of securities, provided that the
borrower at all times maintains cash or equivalent collateral or secures a
letter of credit in favor of the Fund in an amount

13
<PAGE>

equal to at least 100% of the market value of the securities loaned. During the
time portfolio securities are on loan, the borrower will pay the Fund an amount
equivalent to any dividend or interest paid on such securities and the Fund may
invest the cash collateral and earn additional income, or it may receive an
agreed-upon amount of interest income from the borrower. The Fund does not
presently intend to lend more than 5% of the value of its total assets and, as a
matter of fundamental policy, the Fund cannot lend more than 10% of the value of
its total assets. Loans are subject to termination at the option of the Fund or
the borrower. The Fund may pay reasonable administrative and custodial fees in
connection with a loan and may pay a negotiated portion of the interest earned
on the cash or equivalent collateral to the borrower or placing broker. The Fund
does not have the right to vote securities on loan, but would terminate the loan
and regain the right to vote if such vote was considered important with respect
to the Fund's investment in the securities on loan.

The Fund will enter into securities lending transactions only with parties
who meet creditworthiness standards approved by the Board of Directors. The
investment adviser monitors the creditworthiness of such parties under the Board
of Directors' general supervision.

Borrowing

The Fund may borrow an amount equal to no more than 20% of the value of its
total assets (calculated when the loan is made) for temporary, extraordinary or
emergency purposes or for the clearance of transactions. The Fund may pledge up
to 20% of its total assets to secure these borrowings.

Portfolio Turnover

The Fund anticipates that its annual portfolio turnover rate will not
exceed 100% in normal circumstances.

SPECIAL CONSIDERATIONS AND RISKS

Investing in securities of foreign companies and countries involves certain
considerations and risks which are not typically associated with investing in
U.S. Government securities and those of domestic companies. Foreign companies
are not generally subject to uniform accounting, auditing and financial
standards and requirements comparable to those applicable to U.S. companies.
There may also be less government supervision and regulation of foreign
securities exchanges, brokers and listed companies than exists in the United
States. Dividends paid by foreign issuers may be subject to withholding and
other foreign taxes which may decrease the net return on such investments as
compared to dividends and interest paid to the Fund by the U.S. Government or by
domestic companies. In addition, there may be the possibility of expropriations,
confiscatory taxation, political, economic or social instability or diplomatic
developments which could affect assets of the Fund held in foreign countries.

There may be less publicly available information about foreign companies
and governments compared to reports and ratings published about U.S. companies.
Foreign securities markets have substantially less volume than the New York
Stock Exchange and securities of some foreign companies are less liquid and more
volatile than securities of comparable U.S. companies. Brokerage commissions and
other transaction costs on foreign securities exchanges are generally higher
than in the United States.

Shareholders should be aware that investing in the equity and fixed-income
markets of developing countries involves exposure to economies that are
generally less diverse and mature, and to political systems which can be
expected to have less stability than those of developed countries. Historical
experience indicates that the markets of developing countries have been more
volatile than the markets of developed countries. The risks associated with
investments in foreign securities, described above, may be greater with respect
to investments in developing countries.

The operating expense ratio of the Fund can be expected to be higher than
that of an investment company investing exclusively in domestic securities since
the expenses of the Fund, such as custodial costs, valuation costs and
communication costs, as well as the rate of the management fee (.75 of 1% of the
Fund's average daily net assets), though similar to such expenses of other
international funds, are higher than those costs incurred by other investment
companies.

INVESTMENT RESTRICTIONS

The Fund is subject to certain investment restrictions which, like its
investment objective, constitute fundamental policies. Such fundamental policies
cannot be changed without the approval of the holders of a majority of the
Fund's outstanding voting securities. See "Investment Restrictions" in the
Statement of Additional Information.

14
<PAGE>
HOW THE FUND IS MANAGED

The Fund has a Board of Directors which, in addition to overseeing the
actions of the Fund's Manager, Subadviser and Distributor, as set forth below,
decides upon matters of general policy. The Fund's Manager conducts and
supervises the daily business operations of the Fund. The Fund's Subadviser
furnishes daily investment advisory services.

For the fiscal year ended October 31, 1994, the Fund's total expenses as a
percentage of average net assets for the Fund's Class A, Class B and Class C
shares were 1.55%, 2.24% and 2.63% (annualized), respectively. See
"Financial Highlights".

MANAGER

Prudential Mutual Fund Management, Inc. (PMF or the Manager), One Seaport
Plaza, New York, New York 10292, is the Manager of the Fund and is compensated
for its services at an annual rate of .75 of 1% of the Fund's average daily net
assets. It was incorporated in May 1987 under the laws of the State of Delaware.
For the fiscal year ended October 31, 1994, the Fund paid management fees to PMF
of .75% of the Fund's average net assets. See "Manager" in the Statement of
Additional Information.

As of November 30, 1994, PMF served as the manager of 38 open-end
investment companies, constituting all of the Prudential Mutual Funds, and as
manager or administrator of 30 closed-end investment companies, with aggregate
assets of approximately $47 billion.

Under the Management Agreement with the Fund, PMF manages the investment
operations of the Fund and also administers the Fund's corporate affairs. See
"Manager" in the Statement of Additional Information.

Under a Subadvisory Agreement between PMF and The Prudential Investment
Corporation (PIC or the Subadviser), PIC furnishes investment advisory services
in connection with the management of the Fund and is reimbursed by PMF for its
reasonable costs and expenses incurred in providing such services. Under the
Management Agreement, PMF continues to have responsibility for all investment
advisory services and supervises PIC's performance of such services.

The current portfolio manager of the Fund is Daniel J. Duane, a Managing
Director and Chief Investment Officer for Global Equity Investments of
Prudential Investment Advisors, a unit of The Prudential Investment Corporation
(PIC). Mr. Duane has responsibility for the day-to-day management of the Fund's
portfolio. Mr. Duane has been employed by PIC as a portfolio manager since 1990.
He was formerly with First Investors Asset Management from 1986 to 1990 as
senior portfolio manager and head of global equity investments. Mr. Duane is a
Chartered Financial Analyst. Mr. Duane also serves as the portfolio manager of
the Prudential Series Fund Global Equity Portfolio, Prudential Global Genesis
Fund, Prudential Europe Growth Fund, Inc. and Prudential Pacific Growth Fund,
Inc.

PMF and PIC are wholly-owned subsidiaries of The Prudential Insurance
Company of America (Prudential), a major diversified insurance and financial
services company.

DISTRIBUTOR

Prudential Mutual Fund Distributors, Inc. (PMFD), One Seaport Plaza, New
York, New York 10292, is a corporation organized under the laws of the State of
Delaware and serves as the distributor of the Class A shares of the Fund. It is
a wholly-owned subsidiary of PMF.

Prudential Securities Incorporated (Prudential Securities or PSI), One
Seaport Plaza, New York, New York 10292, is a corporation organized under the
laws of the State of Delaware and serves as the distributor of the Class B and
Class C shares of the Fund. It is an indirect, wholly-owned subsidiary of
Prudential.

Under separate Distribution and Service Plans (the Class A Plan, the Class
B Plan and the Class C Plan, collectively, the Plans) adopted by the Fund under
Rule 12b-1 under the Investment Company Act and separate

15
<PAGE>

distribution agreements (the Distribution Agreements), PMFD and Prudential
Securities (collectively, the Distributor) incur the expenses of distributing
the Fund's Class A, Class B and Class C shares. These expenses include
commissions and account servicing fees paid to, or on account of, financial
advisers of Prudential Securities and representatives of Pruco Securities
Corporation (Prusec), an affiliated broker-dealer, commissions and account
servicing fees paid to, or on account of, other broker-dealers or financial
institutions (other than national banks) which have entered into agreements with
the Distributor, advertising expenses, the cost of printing and mailing
prospectuses to potential investors and indirect and overhead costs of
Prudential Securities and Prusec associated with the sale of Fund shares,
including lease, utility, communications and sales promotion expenses. The State
of Texas requires that shares of the Fund may be sold in that state only by
dealers or other financial institutions which are registered there as
broker-dealers.

Under the Plans, the Fund is obligated to pay distribution and/or service
fees to the Distributor as compensation for its distribution and service
activities, not as reimbursement for specific expenses incurred. If the
Distributor's expenses exceed its distribution and service fees, the Fund will
not be obligated to pay any additional expenses. If the Distributor's expenses
are less than such distribution and service fees, it will retain its full fees
and realize a profit.

Under the Class A Plan, the Fund may pay PMFD for its distribution-related
activities with respect to Class A shares at an annual rate of up to .30 of 1%
of the average daily net assets of the Class A shares. The Class A Plan provides
that (i) up to .25 of 1% of the average daily net assets of the Class A shares
may be used to pay for personal service and/or the maintenance of shareholder
accounts (service fee) and (ii) total distribution fees (including the service
fee of up to .25 of 1%) may not exceed .30 of 1% of the average daily net assets
of the Class A shares. PMFD has agreed to limit its distribution-related fees
payable under the Class A Plan to .25 of 1% of the average daily net assets of
the Class A shares for the fiscal year ending October 31, 1995.

For the fiscal year ended October 31, 1994, PMFD received payments of
$146,139 under the Class A Plan. This amount was primarily expended for payment
of account servicing fees to financial advisers and other persons who sell Class
A shares. For the fiscal year ended October 31, 1994, PMFD also received
approximately $575,300 in initial sales charges.

Under the Class B Plan, the Fund pays Prudential Securities for its
distribution-related activities with respect to Class B shares at an annual rate
of .75 of 1% of average daily net assets of the Class B shares up to the level
of the average daily net assets of the Fund as of February 26, 1986, plus 1% of
average daily net assets of the Class B shares in excess of such level. Under
the Class C Plan, the Fund pays Prudential Securities for its
distribution-related expenses with respect to the Class C shares at an annual
rate of 1% of average daily net assets of Class C shares. The Class B and Class
C Plans provide for the payment to Prudential Securities of (i) an asset-based
sales charge of, with respect to the Class B shares, .50 of 1% of the average
daily net assets of the Class B shares up to the level of the average daily net
assets of the Fund on February 26, 1986, plus .75 of 1% of the average daily net
assets of the Class B shares in excess of such level, and, with respect to the
Class C shares, .75 of 1% of the average daily net assets of the Class C shares
and (ii) a service fee of .25 of 1% of the average daily net assets of the Class
B and Class C shares, respectively. The service fee is used to pay for personal
service and/or the maintenance of shareholders accounts. Prudential Securities
also receives contingent deferred sales charges from certain redeeming
shareholders. See "Shareholder Guide--How to Sell Your Shares--Contingent
Deferred Sales Charges."

For the fiscal year ended October 31, 1994, Prudential Securities incurred
distribution expenses of approximately $4,534,404 under the Class B Plan and
received $3,229,844 from the Fund under the Class B Plan. In addition,
Prudential Securities received approximately $508,700 in contingent deferred
sales charges from redemptions of Class B shares during this period.

For the period August 1, 1994 through October 31, 1994, Prudential
Securities received $1,554 from the Fund under the Class C Plan. In addition,
Prudential Securities received approximately $50 in contingent deferred sales
charges from redemptions of Class C shares during this period.

For the fiscal year ended October 31, 1994, the Fund paid distribution
expenses of .25%, .93% and 1.00% of the average net assets of the Class A, Class
B and Class C shares, respectively. The Fund records all payments made under the
Plans as expenses in the calculation of net investment income. Prior to August
1, 1994, the Class A and Class B Plans operated as "reimbursement type" plans
and, in the case of Class B, provided for the reimbursement of distribution
expenses incurred in current and prior years. See "Distributor" in the Statement
of Additional Information.

16
<PAGE>

Distribution expenses attributable to the sale of shares of the Fund will
be allocated to each class based upon the ratio of sales of each class to the
sales of all shares of the Fund other than expenses allocable to a particular
class. The distribution fee and sales charge of one class will not be used to
subsidize the sale of another class.

Each Plan provides that it shall continue in effect from year to year
provided that a majority of the Board of Directors of the Fund, including a
majority of the Directors who are not "interested persons" of the Fund (as
defined in the Investment Company Act) and who have no direct or indirect
financial interest in the operation of the Plan or any agreement related to the
Plan (the Rule 12b-1 Directors), vote annually to continue the Plan. Each Plan
may be terminated at any time by vote of a majority of the Rule 12b-1 Directors
or of a majority of the outstanding shares of the applicable class of the Fund.
The Fund will not be obligated to pay expenses incurred under any plan if it is
terminated or not continued.

In addition to distribution and service fees paid by the Fund under the
Class A, Class B and Class C Plans, the Manager (or one of its affiliates) may
make payments out of its own resources to dealers and other persons which
distribute shares of the Fund. Such payment may be calculated by reference to
the net asset value of shares sold by such persons or otherwise.

The Distributor is subject to the rules of the National Association of
Securities Dealers, Inc. governing maximum sales charges. See "Distributor" in
the Statement of Additional Information.

On October 21, 1993, PSI entered into an omnibus settlement with the SEC,
state securities regulators (with the exception of the Texas Securities
Commissioner who joined the settlement on January 18, 1994) and the NASD to
resolve allegations that from 1980 through 1990 PSI sold certain limited
partnership interests in violation of securities laws to persons for whom such
securities were not suitable and misrepresented the safety, potential returns
and liquidity of these investments. Without admitting or denying the allegations
asserted against it, PSI consented to the entry of an SEC Administrative Order
which stated that PSI's conduct violated the federal securities laws, directed
PSI to cease and desist from violating the federal securities laws, pay civil
penalties, and adopt certain remedial measures to address the violations.

Pursuant to the terms of the SEC settlement, PSI agreed to the imposition
of a $10,000,000 civil penalty, established a settlement fund in the amount of
$330,000,000 and procedures to resolve legitimate claims for compensatory
damages by purchasers of the partnership interests. PSI's settlement with the
state securities regulators included an agreement to pay a penalty of $500,000
per jurisdiction. PSI consented to a censure and to the payment of a $5,000,000
fine in settling the NASD action.

In October 1994, a criminal complaint was filed with the United States
Magistrate for the Southern District of New York alleging that PSI committed
fraud in connection with the sale of certain limited partnership interests in
violation of federal securities laws. An agreement was simultaneously filed to
defer prosecution of these charges for a period of three years from the signing
of the agreement, provided that PSI complies with the terms of the agreement.
If, upon completion of the three year period, PSI has complied with the terms of
the agreement, no prosecution will be instituted by the United States for the
offenses charged in the complaint. If on the other hand, during the course of
the three year period, PSI violates the terms of the agreement, the U.S.
Attorney can then elect to pursue these charges. Under the terms of the
agreement, PSI agreed, among other things, to pay an additional $330,000,000
into the fund established by the SEC to pay restitution to investors who
purchased certain PSI limited partnership interests.

For more detailed information concerning the foregoing matters, see
"Distributor" in the Statement of Additional Information, a copy of which may be
obtained at no cost by calling 1-800-225-1852.

The Fund is not affected by PSI's financial condition and is an entirely
separate legal entity from PSI, which has no beneficial ownership therein and
the Fund's assets which are held by State Street Bank & Trust Company, an
independent custodian, are separate and distinct from PSI.

PORTFOLIO TRANSACTIONS

Prudential Securities may act as a broker or futures commission merchant
for the Fund provided that the commissions, fees or other remuneration it
receives are fair and reasonable. See "Portfolio Transactions and Brokerage" in
the Statement of Additional Information.

17
<PAGE>

CUSTODIAN AND TRANSFER AND DIVIDEND DISBURSING AGENT

State Street Bank and Trust Company, One Heritage Drive, North Quincy,
Massachusetts 02171, serves as Custodian for the Fund's portfolio securities and
cash and, in that capacity, maintains certain financial and accounting books and
records pursuant to an agreement with the Fund. Its mailing address is P.O. Box
1713, Boston, Massachusetts 02105.

Prudential Mutual Fund Services, Inc., Raritan Plaza One, Edison, New
Jersey 08837, serves as Transfer Agent and Dividend Disbursing Agent and in
those capacities maintains certain books and records for the Fund. PMFS is a
wholly-owned subsidiary of PMF. Its mailing address is P.O. Box 15005, New
Brunswick, New Jersey 08906-5005.

HOW THE FUND VALUES ITS SHARES

The Fund's net asset value per share or NAV is determined by subtracting
its liabilities from the value of its assets, and dividing the remainder by the
number of outstanding shares. NAV is calculated separately for each class. For
valuation purposes, quotations of foreign securities in a foreign currency are
converted to U.S. dollar equivalents. The Board of Directors has fixed the
specific time of day for the computation of the Fund's net asset value to be as
of 4:15 P.M., New York time.

Portfolio securities are valued based on market quotations or, if not
readily available, at fair value as determined in good faith under procedures
established by the Fund's Board of Directors. See "Net Asset Value" in the
Statement of Additional Information.

The Fund will compute its NAV once daily on days that the New York Stock
Exchange is open for trading except on days on which no orders to purchase, sell
or redeem shares have been received by the Fund or days on which changes in the
value of the Fund's portfolio securities do not materially affect the NAV. The
New York Stock Exchange is closed on the following holidays: New Year's Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day.

Although the legal rights of each class of shares are substantially
identical, the different expenses borne by each class will result in different
NAVs and dividends. The NAV of Class B and Class C shares will generally be
lower than the NAV of Class A shares as a result of the larger
distribution-related fee to which Class B and Class C shares are subject. It is
expected, however, that the NAV of the three classes will tend to converge
immediately after the recording of dividends, if any, which will differ by
approximately the amount of the distribution-related expense accrual
differential among the classes.

HOW THE FUND CALCULATES PERFORMANCE

From time to time the Fund may advertise its total return (including
"average annual" total return and "aggregate" total return) and yield in
advertisements or sales literature. Total return and yield are calculated
separately for Class A, Class B and Class C shares. These figures are based on
historical earnings and are not intended to indicate future performance. The
"total return" shows how much an investment in the Fund would have increased
(decreased) over a specified period of time (i.e., one, five or ten years or
since inception of the Fund) assuming that all distributions and dividends by
the Fund were reinvested on the reinvestment dates during the period and less
all recurring fees. The "aggregate" total return reflects actual performance
over a stated period of time. "Average annual" total return is a hypothetical
rate of return that, if achieved annually, would have produced the same
aggregate total return if performance had been constant over the entire period.
"Average annual" total return smooths out variations in performance and takes
into account any applicable initial or contingent deferred sales charges.
Neither "average annual" total return nor "aggregate" total return takes into
account any federal or state income taxes which may be payable upon redemption.
The "yield" refers to the income generated by an investment in the Fund over a
one-month or 30-day period. This income is then "annualized"; that is, the
amount of income generated by the investment during that 30-day period is
assumed to be generated each 30-day period for twelve periods and is shown as a
percentage of the investment. The income earned on the investment is also
assumed

18
<PAGE>

to be reinvested at the end of the sixth 30-day period. The Fund may also
include comparative performance information in advertising or marketing the
Fund's shares. Such performance information may include data from Lipper
Analytical Services, Inc., Morningstar Publications, Inc., other industry
publications, business periodicals, and market indices. See "Performance
Information" in the Statement of Additional Information. The Fund will include
performance data for each class of the Fund in any advertisement or information
including performance data of the Fund. Further performance information is
contained in the Fund's annual and semi-annual reports to shareholders, which
may be obtained without charge. See "Shareholder Guide--Shareholder
Services--Reports to Shareholders."

TAXES, DIVIDENDS AND DISTRIBUTIONS

Taxation of the Fund

The Fund has elected to qualify and intends to remain qualified as a
regulated investment company under the Internal Revenue Code. Accordingly, the
Fund will not be subject to federal income taxes on its net investment income
and capital gains, if any, that it distributes to its shareholders. See "Taxes"
in the Statement of Additional Information.

The Fund may, from time to time, invest in Passive Foreign Investment
Companies (PFICs). PFICs are foreign corporations that own mostly passive assets
or that derive 75% or more of their income from passive sources. For tax
purposes, the Fund's investments in PFICs may subject the Fund to federal income
taxes and a charge in the nature of interest with respect to certain gains and
income realized by the Fund. Under proposed Treasury regulations, the Fund would
be able to avoid such taxes and interest by electing to "mark-to-market" its
investments in PFICs i.e., treat them as sold for fair market value at the end
of the year.

Under the Internal Revenue Code, special rules apply to the treatment of
certain options and futures contracts (Section 1256 contracts). At the end of
each year, such investments held by the Fund will be required to be "marked to
market" for federal income tax purposes; that is, treated as having been sold at
market value. Sixty percent of any gain or loss recognized on these "deemed
sales" and on actual dispositions will be treated as long-term capital gain or
loss, and the remainder will be treated as short-term capital gain or loss. See
"Taxes" in the Statement of Additional Information.

Taxation of Shareholders

Any dividends out of net taxable investment income, together with
distributions of net short-term gains (i.e., the excess of net short-term
capital gains over net long-term capital losses) distributed to shareholders,
will be taxable as ordinary income to the shareholder whether or not reinvested.
Any net long-term capital gains (i.e., the excess of net long-term capital gains
over net short-term capital losses) distributed to shareholders will be taxable
as such to the shareholders, whether or not reinvested and regardless of the
length of time a shareholder has owned his or her shares. The maximum long-term
capital gains rate for individuals is 28%. The maximum long-term capital gains
rate for corporate shareholders is currently the same as the maximum tax rate
for ordinary income.

Dividends paid by the Fund will be eligible for the 70% dividends-received
deduction for corporate shareholders to the extent that the Fund's income is
derived from certain dividends received from domestic corporations. Capital
gains distributions are not eligible for the 70% dividends-received deduction.

The Fund has obtained opinions of counsel to the effect that neither (i)
the conversion of Class B shares into Class A shares nor (ii) the exchange of
Class B or Class C shares for Class A shares constitutes a taxable event for
federal income tax purposes. However, such opinions are not binding on the
Internal Revenue Service.

Shareholders are advised to consult their own tax advisers regarding
specific questions as to federal, state or local taxes. See "Taxes" in the
Statement of Additional Information.

Withholding Taxes

Under U.S. Treasury Regulations, the Fund is required to withhold and remit
to the U.S. Treasury 31% of dividend, capital gain income and redemption
proceeds on the accounts of those shareholders who fail to furnish their tax
identification numbers on IRS Form W-9 (or

19
<PAGE>

IRS Form W-8 in the case of certain foreign shareholders) with the required
certifications regarding the shareholder's status under the federal income tax
law. Dividends of net investment income and net short-term capital gains to a
foreign shareholder will generally be subject to U.S. withholding tax at the
rate of 30% (or lower treaty rate).

Investment income received by the Fund from sources within foreign
countries may be subject to foreign income taxes withheld at source. If the Fund
should have more than 50% of the value of its assets invested in securities of
foreign corporations at the close of its taxable year, which is the Fund's
present intention, the Fund may elect to permit its shareholders to take, either
as a credit or as a deduction, their proportionate share of the foreign income
taxes paid, subject to generally applicable limitations.

Dividends and Distributions

The Fund expects to distribute annually to its shareholders all of its net
investment income and any net capital gains. Dividends paid by the Fund with
respect to each class of shares, to the extent any dividends are paid, will be
calculated in the same manner, at the same time, on the same day and will be in
the same amount except that each class will bear its own distribution charges,
generally resulting in lower dividends for Class B and Class C shares.
Distribution of net capital gains, if any, will be paid in the same amount for
each class of shares. See "How the Fund Values its Shares." The Fund utilized
its capital loss carryforward of approximately, $11,527,100 to offset the Fund's
net taxable gains realized and recognized in the fiscal year ended October 31,
1994.

Dividends and distributions will be paid in additional Fund shares based on
the NAV of each class on the record date, or such other date as the Board of
Directors may determine, unless the shareholder elects in writing not less than
five business days prior to the record date to receive such dividend and
distributions in cash. Such election should be submitted to Prudential Mutual
Fund Services, Inc., Attention: Account Maintenance, P.O. Box 15015, New
Brunswick, New Jersey 08906-5015. The Fund will notify each shareholder after
the close of the Fund's taxable year both of the dollar amount and the taxable
status of that year's dividends and distributions on a per share basis. If you
hold shares through Prudential Securities, you should contact your financial
adviser to elect to receive dividends and distributions in cash.

When the Fund goes "ex-dividend," the NAV of each class is reduced by the
amount of the dividend or distribution allocable to each class. If you buy
shares just prior to the ex-dividend date (which generally occurs four business
days prior to the record date), the price you pay will include the dividend or
distribution and a portion of your investment will be returned to you as a
taxable distribution. You should, therefore, consider the timing of dividends
and distributions when making your purchases.

GENERAL INFORMATION

DESCRIPTION OF COMMON STOCK

The Fund was incorporated in Maryland on February 28, 1984. The Fund is
authorized to issue 500 million shares of common stock, $.01 par value per
share, divided into three classes, designated Class A, Class B and Class C
common stock, each of which consists of 166,666,666-2/3 authorized shares. Each
class of common stock represents an interest in the same assets of the Fund and
is identical in all respects except that (i) each class bears different
distribution expenses, (ii) each class has exclusive voting rights with respect
to its distribution and service plan (except that the Fund has agreed with the
SEC in connection with the offering of a conversion feature on Class B shares to
submit any amendment of the Class A distribution and service plan to both Class
A and Class B shareholders), (iii) each class has a different exchange privilege
and (iv) only Class B shares have a conversion feature. See "How the Fund is
Managed--Distributor." The Fund has received an order from the SEC permitting
the issuance and sale of multiple classes of common stock. Currently, the Fund
is offering three classes, designated Class A, Class B and Class C shares. In
accordance with the Fund's Articles of Incorporation, the Board of Directors may
authorize the creation of additional series of common stock and classes within
such series, with such preferences, privileges, limitations and voting and
dividend rights as the Board may determine.

20
<PAGE>

The Board of Directors may increase or decrease the number of authorized
shares without the approval of shareholders. Shares of the Fund, when issued,
are fully paid, nonassessable, fully transferable and redeemable at the option
of the holder. Shares are also redeemable at the option of the Fund under
certain circumstances as described under "Shareholder Guide--How to Sell Your
Shares." Each share of each class of common stock is equal as to earnings,
assets and voting privileges, except as noted above, and each class bears the
expenses related to the distribution of its shares. Except for the conversion
feature applicable to the Class B shares, there are no conversion, preemptive or
other subscription rights. In the event of liquidation, each share of common
stock of the Fund is entitled to its portion of all of the Fund's assets after
all debt and expenses of the Fund have been paid. Since Class B and Class C
shares generally bear higher distribution expenses than Class A shares, the
liquidation proceeds to shareholders of those classes are likely to be lower
than to Class A shareholders. The Fund's shares do not have cumulative voting
rights for the election of Directors.

The Fund does not intend to hold annual meetings of shareholders unless
otherwise required by law. The Fund will not be required to hold annual meetings
of shareholders unless, for example, the election of Directors is required to be
acted on by shareholders under the Investment Company Act. Shareholders have
certain rights, including the right to call a meeting upon a vote of 10% of the
Fund's outstanding shares for the purpose of voting on the removal of one or
more Directors or to transact any other business.

ADDITIONAL INFORMATION

This Prospectus, including the Statement of Additional Information which
has been incorporated by reference herein, does not contain all the information
set forth in the Registration Statement filed by the Fund with the SEC under the
Securities Act. Copies of the Registration Statement may be obtained at a
reasonable charge from the SEC or may be examined, without charge, at the office
of the SEC in Washington, D.C.

SHAREHOLDER GUIDE

HOW TO BUY SHARES OF THE FUND

You may purchase shares of the Fund through Prudential Securities, Prusec
or directly from the Fund through its Transfer Agent, Prudential Mutual Fund
Services, Inc. (PMFS or the Transfer Agent), Attention: Investment Services,
P.O. Box 15020, New Brunswick, New Jersey 08906-5020. The minimum initial
investment for Class A and Class B shares is $1,000 per class and $5,000 for
Class C shares. The minimum subsequent investment is $100 for all classes. All
minimum investment requirements are waived for certain retirement and employee
savings plans or custodial accounts for the benefit of minors. For purchases
through the Automatic Savings Accumulation Plan, the minimum initial and
subsequent investment is $50. The minimum initial investment requirement is
waived for purchases of Class A shares effected through an exchange of Class B
shares of The BlackRock Government Income Trust. See "Shareholder Services".

The purchase price is the NAV next determined following receipt of an order
by the Transfer Agent or Prudential Securities plus a sales charge which, at
your option, may be imposed either (i) at the time of purchase (Class A shares)
or (ii) on a deferred basis (Class B or Class C shares). See "Alternative
Purchase Plan" below. See also "How the Fund Values its Shares."

Application forms can be obtained from PMFS, Prudential Securities or
Prusec. If a stock certificate is desired, it must be requested in writing for
each transaction. Certificates are issued only for full shares. Shareholders who
hold their shares through Prudential Securities will not receive stock
certificates.

The Fund reserves the right to reject any purchase order (including an
exchange into the Fund) or to suspend or modify the continuous offering of its
shares. See "How to Sell Your Shares".

21
<PAGE>

Your dealer is responsible for forwarding payment promptly to the Fund. The
Distributor reserves the right to cancel any purchase order for which payment
has not been received by the fifth business day following the investment.

Transactions in Fund shares may be subject to postage and handling charges
imposed by your dealer.

Purchase By Wire. For an initial purchase of shares of the Fund by wire,
you must first telephone PMFS at (800) 225-1852 (toll-free) to receive an
account number. The following information will be requested: your name, address,
tax identification number, class election, dividend distribution election,
amount being wired and wiring bank. Instructions should then be given by you to
your bank to transfer funds by wire to State Street Bank and Trust Company,
Boston, Massachusetts, Custody and Shareholder Services Division, Attention:
Prudential Global Fund, Inc., specifying on the wire the account number assigned
by PMFS and your name and identifying the sales charge alternative (Class A,
Class B or Class C shares).

If you arrange for receipt by State Street of Federal Funds prior to 4:15
P.M., New York time, on a business day, you may purchase shares of the Fund as
of that day.

In making a subsequent purchase order by wire, you should wire State Street
directly and should be sure that the wire specifies Prudential Global Fund,
Inc., Class A, Class B or Class C shares and your name and individual account
number. It is not necessary to call PMFS to make subsequent purchase orders
utilizing Federal Funds. The minimum amount which may be invested by wire is
$1,000.

ALTERNATIVE PURCHASE PLAN

The Fund offers three classes of shares (Class A, Class B and Class C
shares) which allows you to choose the most beneficial sales charge structure
for your individual circumstances given the amount of the purchase, the length
of time you expect to hold the shares and other relevant circumstances
(Alternative Purchase Plan).
<TABLE>
<CAPTION>

Annual 12b-1 Fees
(as a % of average daily
Sales Charge net assets) Other Information
------------------------------------- ------------------------ --------------------------------------
<S> <C> <C> <C>
Class A Maximum initial sales charge of 5% of .30 of 1% (Currently Initial sales charge waived or reduced
the public offering price being charged at a rate for certain purchases
of .25 of 1%)

Class B Maximum contingent deferred sales 1% Shares convert to Class A shares
charge or CDSC of 5% of the lesser of approximately seven years after
the amount invested or the redemption purchase
proceeds; declines to zero after six
years

Class C Maximum CDSC of 1% of the lesser 1% Shares do not convert to another class
of the amount invested or the
redemption proceeds on redemptions
made within one year of purchase
</TABLE>

The three classes of shares represent an interest in the same portfolio of
investments of the Funds and have the same rights, except that (i) each class
bears the separate expenses of its Rule 12b-1 distribution and service plan,
(ii) each class has exclusive voting rights with respect to its plan (except as
noted under the heading "General Information--Description of Common Stock"), and
(iii) only Class B shares have a conversion feature. The three classes also have
separate exchange privileges. See "How to Exchange Your Shares" below. The
income attributable to each class and the dividends payable on the shares of
each class will be reduced by the amount of the distribution fee of each class.
Class B and Class C shares bear the expenses of a higher distribution fee which
will generally cause them to have higher expense ratios and to pay lower
dividends than the Class A shares.

Financial advisers and other sales agents who sell shares of the Fund will
receive different compensation for selling Class A, Class B and Class C shares
and will generally receive more compensation initially for selling Class A and
Class B shares than for selling Class C shares.

22
<PAGE>

In selecting a purchase alternative, you should consider, among other
things, (1) the length of time you expect to hold your investment, (2) the
amount of any applicable sales charge (whether imposed at the time of purchase
or redemption) and distribution-related fees, as noted above, (3) whether you
qualify for any reduction or waiver of any applicable sales charge, (4) the
various exchange privileges among the different classes of shares (see "How to
Exchange Your Shares" below) and (5) that Class B shares automatically convert
to Class A shares approximately seven years after purchase (see "Conversion
Feature--Class B Shares" below).

The following is provided to assist you in determining which method of
purchase best suits your individual circumstances and is based on current fees
and expenses being charged to the Fund:

If you intend to hold your investment in the Fund for less than 7 years and
do not qualify for a reduced sales charge on Class A shares, since Class A
shares are subject to a maximum initial sales charge of 5% and Class B shares
are subject to a CDSC of 5% which declines to zero over a 6 year period, you
should consider purchasing Class C shares over either Class A or Class B shares.

If you intend to hold your investment for 7 years or more and do not
qualify for a reduced sales charge on Class A shares, since Class B shares
convert to Class A shares approximately 7 years after purchase and because all
of your money would be invested initially in the case of Class B shares, you
should consider purchasing Class B shares over either Class A or Class C shares.

If you qualify for a reduced sales charge on Class A shares, it may be more
advantageous for you to purchase Class A shares over either Class B or Class C
shares regardless of how long you intend to hold your investment. However,
unlike Class B and Class C shares, you would not have all of your money invested
initially because the sales charge on Class A shares is deducted at the time of
purchase.

If you do not qualify for a reduced sales charge on Class A shares and you
purchase Class B or Class C shares, you would have to hold your investment for
more than 6 years in the case of Class B and Class C shares for the higher
cumulative annual distribution-related fee on those shares to exceed the initial
sales charge plus cumulative annual distribution-related fee on Class A shares.
This does not take into account the time value of money, which further reduces
the impact of the higher Class B or Class C distribution-related fee on the
investment, fluctuations in net asset value, the effect of the return on the
investment over this period of time or redemptions during which the CDSC is
applicable.

All purchases of $1 million or more, either as part of a single investment
or under Rights of Accumulation or Letters of Intent, must be for Class A
shares. See "Reduction and Waiver of Initial Sales Charges" below.

Class A Shares

The offering price of Class A shares for investors choosing the initial
sales charge alternative is the next determined NAV plus a sales charge
(expressed as a percentage of the offering price and of the amount invested) as
shown in the following table:

Sales Charge As Sales Charge As Dealer Concession
Percentage of Percentage of Net as Percentage of
Amount of Purchase Offering Price Amount Invested Offering Price
- ----------------- -------------- ----------------- -----------------
$0 to $24,999 5.00% 5.26% 4.75%
$25,000 to $49,999 4.50 4.71 4.25
$50,000 to $99,999 4.00 4.17 3.75
$100,000 to $249,999 3.25 3.36 3.00
$250,000 to $499,999 2.50 2.56 2.40
$500,000 to $999,999 2.00 2.04 1.90
$1,000,000 and above None None None

Selling dealers may be deemed to be underwriters, as that term is defined
in the Securities Act.

Reduction and Waiver of Initial Sales Charges. Reduced sales charges are
available through Rights of Accumulation and Letters of Intent. Shares of the
Fund and shares of other Prudential Mutual Funds (excluding money market funds
other than those acquired pursuant to the exchange privilege) may be aggregated
to determine the applicable reduction. See "Purchase and Redemption of Fund
Shares--Reduction and Waiver of Initial Sales Charges--Class A Shares" in the
Statement of Additional Information.

23
<PAGE>

Benefit Plans. Class A shares may be purchased at NAV, without payment of
an initial sales charge, by pension, profit-sharing or other employee benefit
plans qualified under Section 401 of the Internal Revenue Code and deferred
compensation and annuity plans under Sections 457 and 403(b)(7) of the Internal
Revenue Code (Benefit Plans), provided that the plan has existing assets of at
least $1 million invested in shares of Prudential Mutual Funds (excluding money
market funds other than those acquired pursuant to the exchange privilege) or
1,000 eligible employees or participants. In the case of Benefit Plans whose
accounts are held directly with the Transfer Agent or Prudential Securities and
for which the Transfer Agent or Prudential Securities does individual account
record keeping (Direct Account Benefit Plans) and Benefit Plans sponsored by PSI
or its subsidiaries (PSI or Subsidiary Prototype Benefit Plans), Class A shares
may be purchased at NAV by participants who are repaying loans made from such
plans to the participant.

Special Rules Applicable to Retirement Plans. After a Benefit Plan
qualifies to purchase Class A shares at NAV, all subsequent purchases will be
made at NAV.

Other Waivers. In addition, Class A shares may be purchased at NAV, through
Prudential Securities or the Transfer Agent, by the following persons: (a)
Directors and officers of the Fund and other Prudential Mutual Funds, (b)
employees of Prudential Securities and PMF and their subsidiaries and members of
the families of such persons who maintain an "employee related" account at
Prudential Securities or the Transfer Agent, (c) employees and special agents of
Prudential and its subsidiaries and all persons who have retired directly from
active service with Prudential or one of its subsidiaries, (d) registered
representatives and employees of dealers who have entered into a selected dealer
agreement with Prudential Securities provided that purchases at NAV are
permitted by such person's employer and (e) investors who have a business
relationship with a financial adviser who joined Prudential Securities from
another investment firm, provided that (i) the purchase is made within 90 days
of the commencement of the financial adviser's employment at Prudential
Securities, (ii) the purchase is made with proceeds of a redemption of shares of
any open-end, non-money market fund sponsored by the financial adviser's
previous employer (other than a fund which imposes a distribution or service fee
of .25 of 1% or less) on which no deferred sales load, fee or other charge was
imposed on redemption and (iii) the financial adviser served as the client's
broker on the previous purchases.

You must notify the Transfer Agent either directly or through Prudential
Securities or Prusec that you are entitled to the reduction or waiver of the
sales charge. The reduction or waiver will be granted subject to confirmation of
your entitlement. No initial sales charges are imposed upon Class A shares
acquired upon the reinvestment of dividends and distributions. See "Purchase and
Redemption of Fund Shares--Reduction and Waiver of Initial Sales Charges--Class
A Shares" in the Statement of Additional Information.

Class B and Class C Shares

The offering price of Class B and Class C shares for investors choosing one
of the deferred sales charge alternatives is the NAV next determined following
receipt of an order by the Transfer Agent or Prudential Securities. Although
there is no sales charge imposed at the time of purchase, redemptions of Class B
and Class C shares may be subject to a CDSC. See "How to Sell Your
Shares--Contingent Deferred Sales Charges."

HOW TO SELL YOUR SHARES

You can redeem shares of the Fund at any time for cash at the NAV next
determined after the redemption request is received in proper form by the
Transfer Agent or Prudential Securities. See "How The Fund Values Its Shares."
In certain cases, however, redemption proceeds will be reduced by the amount of
any applicable contingent deferred sales charge, as described below. See
"Contingent Deferred Sales Charges" below.

If you hold shares of the Fund through Prudential Securities, you must
redeem your shares by contacting your Prudential Securities financial adviser.
If you hold shares in non-certificate form, a written request for redemption
signed by you exactly as the account is registered is required. If you hold
certificates, the certificates signed in the name(s) shown on the face of the
certificates, must be received by the Transfer Agent in order for the redemption
request to be processed. If redemption is requested by a corporation,
partnership, trust or fiduciary, written evidence of authority acceptable to the
Transfer Agent must be submitted before such request will be accepted. All
correspondence and documents concerning redemptions should be sent to the Fund
in care of its Transfer Agent, Prudential Mutual Fund Services, Inc., Attention:
Redemption Services, P.O. Box 15010, New Brunswick, New Jersey 08906-5010.

24
<PAGE>

If the proceeds of the redemption (a) exceed $50,000, (b) are to be paid
to a person other than the record owner, (c) are to be sent to an address other
than the address on the Transfer Agent's records, or (d) are to be paid to a
corporation, partnership, trust or fiduciary, the signature(s) on the redemption
request and on the certificates, if any, or stock power must be guaranteed by an
"eligible guarantor institution." An "eligible guarantor institution" includes
any bank, broker, dealer or credit union. The Transfer Agent reserves the right
to request additional information from, and make reasonable inquiries of, any
eligible guarantor institution. For clients of Prusec, a signature guarantee may
be obtained from the agency or office manager of most Prudential Insurance and
Financial Services or Prudential Preferred Financial Services offices.

Payment for shares presented for redemption will be made by check within
seven days after receipt by the Transfer Agent of the certificate and/or written
request except as indicated below. If you hold shares through Prudential
Securities, payment for shares presented for redemption will be credited to your
Prudential Securities account, unless you indicate otherwise. Such payment may
be postponed or the right of redemption suspended at times (a) when the New York
Stock Exchange is closed for other than customary weekends and holidays, (b)
when trading on such Exchange is restricted, (c) when an emergency exists as a
result of which disposal by the Fund of securities owned by it is not reasonably
practicable or it is not reasonably practicable for the Fund fairly to determine
the value of its net assets, or (d) during any other period when the SEC, by
order, so permits; provided that applicable rules and regulations of the SEC
shall govern as to whether the conditions prescribed in (b), (c) or (d) exist.

Payment for redemption of recently purchased shares will be delayed until
the Fund or its Transfer Agent has been advised that the purchase check has been
honored, up to 10 calendar days from the time of receipt of the purchase check
by the Transfer Agent. Such delay may be avoided by purchasing shares by wire or
by certified or official bank check.

Redemption In Kind. If the Board of Directors determines that it would be
detrimental to the best interests of the remaining shareholders of the Fund to
make payment wholly or partly in cash, the Fund may pay the redemption price in
whole or in part by a distribution in kind of securities from the investment
portfolio of the Fund, in lieu of cash, in conformity with applicable rules of
the SEC. Securities will be readily marketable and will be valued in the same
manner as in a regular redemption. See "How The Fund Values Its Shares". If your
shares are redeemed in kind, you would incur transaction costs in converting the
assets into cash. The Fund, however, has elected to be governed by Rule 18f-1
under the Investment Company Act, under which the Fund is obligated to redeem
shares solely in cash up to the lesser of $250,000 or 1% of the net asset value
of the Fund during any 90-day period for any one shareholder.

Involuntary Redemption. In order to reduce expenses of the Fund, the Board
of Directors may redeem all of the shares of any shareholder, other than a
shareholder which is an IRA or other tax-deferred retirement plan, whose account
has a net asset value of less than $500 due to a redemption. The Fund will give
such shareholders 60 days' prior written notice in which to purchase sufficient
additional shares to avoid such redemption. No contingent deferred sales charge
will be imposed on any involuntary redemption.

30-Day Repurchase Privilege. If you redeem your shares and have not
previously exercised the repurchase privilege you may reinvest any portion or
all of the proceeds of such redemption in shares of the Fund at the net asset
value next determined after the order is received, which must be within 30 days
after the date of the redemption. No sales charge will apply to such
repurchases. You will receive pro rata credit for any contingent deferred sales
charge paid in connection with the redemption of Class B or Class C shares. You
must notify the Fund's Transfer Agent, either directly or through Prudential
Securities or Prusec, at the time the repurchase privilege is exercised that you
are entitled to credit for the contingent deferred sales charge previously paid.
Exercise of the repurchase privilege will generally not affect federal income
tax treatment of any gain realized upon redemption. If the redemption resulted
in a loss, some or all of the loss, depending on the amount reinvested, will not
be allowed for federal income tax purposes.

Contingent Deferred Sales Charges

Redemptions of Class B shares will be subject to a contingent deferred
sales charge or CDSC declining from 5% to zero over a six-year period. Class C
shares redeemed within one year of purchase will be subject to a 1% CDSC. The
CDSC will be deducted from the redemption proceeds and reduce the amount paid to
you. The CDSC will be imposed on any redemption by you which reduces the current
value of your Class B or Class C shares to an amount which is lower than the
amount of all payments by you for shares during the preceding six years, in the
case of Class B shares, and one year, in the case of Class C shares. A CDSC will
be applied on the lesser of the

25
<PAGE>

original purchase price or the current value of the shares being redeemed.
Increases in the value of your shares or shares acquired through reinvestment of
dividends or distributions are not subject to a CDSC. The amount of any
contingent deferred sales charge will be paid to and retained by the
Distributor. See "How the Fund is Managed--Distributor" and "Waiver of the
Contingent Deferred Sales Charges--Class B Shares" below.

The amount of the CDSC, if any, will vary depending on the number of years
from the time of payment for the purchase of your shares until the time of
redemption of such shares. Solely for purposes of determining the number of
years from the time of any payment for the purchase of shares, all payments
during a month will be aggregated and deemed to have been made on the last day
of the month. The CDSC will be calculated from the first day of the month after
the initial purchase, excluding the time shares were held in a money market
fund. See "How to Exchange Your Shares."

The following table sets forth the rates of the CDSC applicable to
redemptions of Class B shares:

Contingent Deferred Sales
Charge as a Percentage of
Year Since Purchase Dollars Invested or
Payment Made Redemption Proceeds
- ------------ -------------------------
First ............................................... 5.0%
Second .............................................. 4.0%
Third ............................................... 3.0%
Fourth .............................................. 2.0%
Fifth ............................................... 1.0%
Sixth ............................................... 1.0%
Seventh ............................................. None

In determining whether a CDSC is applicable to a redemption, the
calculation will be made in a manner that results in the lowest possible rate.
It will be assumed that the redemption is made first of amounts representing
shares acquired pursuant to the reinvestment of dividends and distributions;
then of amounts representing the increase in net asset value above the total
amount of payments for the purchase of Fund shares made during the preceding six
years (five years for Class B shares purchased prior to January 22, 1990);
then of amounts representing the cost of shares held beyond the applicable CDSC
period, and finally, of amounts representing the cost of shares held for the
longest period of time within the applicable CDSC period.

For example, assume you purchased 100 Class B shares at $10 per share for a
cost of $1,000. Subsequently, you acquired 5 additional Class B shares through
dividend reinvestment. During the second year after the purchase you decided to
redeem $500 of your investment. Assuming at the time of the redemption the NAV
had appreciated to $12 per share, the value of your Class B shares would be
$1,260 (105 shares at $12 per share). The CDSC would not be applied to the value
of the reinvested dividend shares and the amount which represents appreciation
($260). Therefore, $240 of the $500 redemption proceeds ($500 minus $260) would
be charged at a rate of 4% (the applicable rate in the second year after
purchase) for a total CDSC of $9.60.

For federal income tax purposes, the amount of the CDSC will reduce the
gain or increase the loss, as the case may be, on the amount recognized on the
redemption of shares.

Waiver of the Contingent Deferred Sales Charges--Class B Shares. The CDSC
will be waived in the case of a redemption following the death or disability of
a shareholder or, in the case of a trust account, following the death or
disability of the grantor. The waiver is available for total or partial
redemptions of shares owned by a person, either individually or in joint tenancy
(with rights of survivorship), or a trust, at the time of death or initial
determination of disability, provided that the shares were purchased prior to
death or disability.

The CDSC will also be waived in the case of a total or partial redemption
in connection with certain distributions made without penalty under the Internal
Revenue Code from a tax-deferred retirement plan, an IRA or Section 403(b)
custodial account. These distributions include: (i) in the case of a
tax-deferred retirement plan, a lump-sum or other distribution after retirement;
(ii) in the case of an IRA or

26
<PAGE>

Section 403(b) custodial account, a lump-sum or other distribution after
attaining age 59 1/2; and (iii) a tax-free return of an excess contribution or
plan distributions following the death or disability of the shareholder,
provided that the shares were purchased prior to death or disability. The waiver
does not apply in the case of a tax-free rollover or transfer of assets, other
than one following a separation from service (i.e., following voluntary or
involuntary termination of employment or following retirement). Under no
circumstances will the CDSC be waived on redemptions resulting from the
termination of a tax-deferred retirement plan, unless such redemptions otherwise
qualify for a waiver as described above.

In the case of Direct Account and PSI or Subsidiary Prototype Benefit
Plans, the CDSC will also be waived on the redemptions which represent
borrowings from such plans. Shares purchased with amounts used to repay a loan
from such plans on which a CDSC was not previously deducted will thereafter be
subject to a CDSC without regard to the time such amounts were previously
invested. In the case of a 401(k) plan, the CDSC will also be waived upon the
redemption of shares purchased with amounts used to repay loans made from the
account to the participant and from which a CDSC was previously deducted.

In addition, the CDSC will be waived on redemptions of shares held by
Directors of the Fund.

You must notify the Transfer Agent either directly or through Prudential
Securities or Prusec, at the time of redemption, that you are entitled to waiver
of the CDSC and provide the Transfer Agent with such supporting documentation as
it may deem appropriate. The waiver will be granted subject to confirmation of
your entitlement. See "Purchase and Redemption of Fund Shares--Waiver of the
Contingent Deferred Sales Charge--Class B Shares" in the Statement of Additional
Information.

A quantity discount may apply to redemptions of Class B shares purchased
prior to August 1, 1994. See "Purchase and Redemption of Fund Shares--Quantity
Discount--Class B Shares Purchased Prior to August 1, 1994" in the Statement of
Additional Information.

CONVERSION FEATURE--CLASS B SHARES

Class B shares will automatically convert to Class A shares on a quarterly
basis approximately seven years after purchase. It is currently anticipated that
conversions will occur during the months of February, May, August and November
commencing in or about February 1995. Conversions will be effected at relative
net asset value without the imposition of any additional sales charge.

Since the Fund tracks amounts paid rather than the number of shares bought
on each purchase of Class B shares, the number of Class B shares eligible to
convert to Class A shares (excluding shares acquired through the automatic
reinvestment of dividends and other distributions) (the Eligible Shares) will be
determined on each conversion date in accordance with the following formula: (i)
the ratio of (a) the amounts paid for Class B shares purchased at least seven
years prior to the conversion date to (b) the total amount paid for all Class B
shares purchased and then held in your account (ii) multiplied by the total
number of Class B shares purchased and then held in your account. Each time any
Eligible Shares in your account convert to Class A shares, all shares or amounts
representing Class B shares then in your account that were acquired through the
automatic reinvestment of dividends and other distributions will convert to
Class A shares.

For purposes of determining the number of Eligible Shares, if the Class B
shares in your account on any conversion date are the result of multiple
purchases at different net asset values per share, the number of Eligible Shares
calculated as described above will generally be either more or less than the
number of shares actually purchased approximately seven years before such
conversion date. For example, if 100 shares were initially purchased at $10 per
share (for a total of $1,000) and a second purchase of 100 shares was
subsequently made at $11 per share (for a total of $1,100), 95.24 shares would
convert approximately seven years from the initial purchase (i.e., $1,000
divided by $2,100 (47.62%) multiplied by 200 shares equals 95.24 shares). The
Manager reserves the right to modify the formula for determining the number of
Eligible Shares in the future as it deems appropriate on notice to shareholders.

Since annual distribution-related fees are lower for Class A shares than
Class B shares, the per share net asset value of the Class A shares may be
higher than that of the Class B shares at the time of conversion. Thus, although
the aggregate dollar value will be the same, you may receive fewer Class A
shares than Class B shares converted. See "How the Fund Values its Shares."

For purposes of calculating the applicable holding period for conversions,
all payments for Class B shares during a month will be deemed to have been made
on the last day of the month, or for Class B shares acquired through exchange,
or a series of exchanges, on the

27
<PAGE>

last day of the month in which the original payment for purchases of such
Class B shares was made. For Class B shares previously exchanged for shares of a
money market fund, the time period during which such shares were held in the
money market fund will be excluded. For example, Class B shares held in a money
market fund for one year will not convert to Class A shares until approximately
eight years from purchase. For purposes of measuring the time period during
which shares are held in a money market fund, exchanges will be deemed to have
been made on the last day of the month. Class B shares acquired through exchange
will convert to Class A shares after expiration of the conversion period
applicable to the original purchase of such shares. The conversion feature
described above will not be implemented and, consequently, the first conversion
of Class B shares will not occur before February 1995, but as soon thereafter as
practicable. At that time all amounts representing Class B shares then
outstanding beyond the applicable conversion period will automatically convert
to Class A shares together with all shares or amounts representing Class B
shares acquired through the automatic reinvestment of dividends and
distributions then held in your account.

The conversion feature may be subject to the continuing availability of
opinions of counsel or rulings of the Internal Revenue Service (i) that the
dividends and other distributions paid on Class A, Class B and Class C shares
will not constitute "preferential dividends" under the Internal Revenue Code and
(ii) that the conversion of shares does not constitute a taxable event. The
conversion of Class B shares into Class A shares may be suspended if such
opinions or rulings are no longer available. If the conversions are suspended,
Class B shares of the Fund will continue to be subject, possibly indefinitely,
to their higher annual distribution and service fee.

HOW TO EXCHANGE YOUR SHARES

As a shareholder of the Fund you have an exchange privilege with certain
other Prudential Mutual Funds, including one or more specified money market
funds, subject to the minimum investment requirement of such funds. Class A,
Class B and Class C shares may be exchanged for Class A, Class B and Class C
shares, respectively, of another fund on the basis of the relative NAV. No sales
charge will be imposed at the time of the exchange. Any applicable CDSC payable
upon the redemption of shares exchanged will be calculated from the first day of
the month after the initial purchase, excluding the time shares were held in a
money market fund. Class B and Class C shares may not be exchanged into money
market funds other than Prudential Special Money Market Fund. For purposes of
calculating the seven year holding period applicable to the Class B conversion
feature, the time period during which Class B shares were held in a money market
fund will be excluded. See "Conversion Feature--Class B Shares" above. An
exchange will be treated as a redemption and purchase for tax purposes. See
"Shareholder Investment Account--Exchange Privilege" in the Statement of
Additional Information.

In order to exchange shares by telephone, you must authorize the telephone
exchange privilege on your initial application form or by written notice to the
Transfer Agent and hold shares in non-certificate form. Thereafter, you may call
the Fund at 1 (800) 225-1852 to execute a telephone exchange of shares on
weekdays, except holidays, between the hours of 8:00 a.m. and 6:00 p.m., New
York time. For your protection and to prevent fraudulent exchanges, your
telephone call will be recorded and you will be asked to provide your personal
identification number. A written confirmation of the exchange transaction will
be sent to you. Neither the Fund nor its agents will be liable for any loss,
liability or cost which results from acting upon instructions reasonably
believed to be genuine under the foregoing procedures. All exchanges will be
made on the basis of the relative NAV of the two funds next determined after the
request is received in good order. The Exchange Privilege is available only in
states where the exchange may legally be made.

If you hold shares through Prudential Securities or through a dealer which
has entered into a selected dealer agreement with the Fund's Distributor, you
must exchange your shares by contacting your financial adviser.

If you hold certificates, the certificates, signed in the name(s) shown on
the face of the certificates must be returned in order for the shares to be
exchanged. See "How to Sell Your Shares" above.

You may also exchange shares by mail by writing to Prudential Mutual Fund
Services, Inc., Attention: Exchange Processing, P.O. Box 15010, New Brunswick,
New Jersey 08906-5010.

In periods of severe market or economic conditions the telephone exchange
of shares may be difficult to implement and shareholders should make exchanges
by mail by writing to Prudential Mutual Fund Services, Inc., at the address
noted above.

28
<PAGE>

Special Exchange Privilege. Commencing in or about February 1995, a special
exchange privilege is available for shareholders who qualify to purchase Class A
shares at NAV. See "Alternative Purchase Plan--Class A Shares--Reduction and
Waiver of Initial Sales Charges" above. Under this exchange privilege, amounts
representing any Class B and Class C shares (which are not subject to a CDSC)
held in such a shareholder's account will be automatically exchanged for Class A
shares on a quarterly basis, unless the shareholder elects otherwise. It is
currently anticipated that this exchange will occur quarterly in February, May,
August and November. Eligibility for this exchange privilege will be calculated
on the business day prior to the date of the exchange. Amounts representing
Class B or Class C shares which are not subject to a CDSC include the following:
(1) amounts representing Class B or Class C shares acquired pursuant to the
automatic reinvestment of dividends and distributions, (2) amounts representing
the increase in the net asset value above the total amount of payments for the
purchase of Class B or Class C shares and (3) amounts representing Class B or
Class C shares held beyond the applicable CDSC period. Class B and Class C
shareholders must notify the Transfer Agent either directly or through
Prudential Securities or Prusec that they are eligible for this special exchange
privilege.

The Exchange Privilege may be modified or terminated at any time on 60
days' notice.

SHAREHOLDER SERVICES

In addition to the exchange privilege, as a shareholder in the Fund, you
can take advantage of the following additional services and privileges:

Automatic Reinvestment of Dividends and/or Distributions Without Sales
Charge. For your convenience, all dividends and distributions are automatically
reinvested in full and fractional shares of the Fund at NAV without a sales
charge. You may direct the Transfer Agent in writing not less than 5 full
business days prior to the record date to have subsequent dividends and/or
distributions sent in cash rather than reinvested. If you hold shares through
Prudential Securities, you should contact your financial adviser.

Automatic Savings Accumulation Plan (ASAP). Under ASAP you may make regular
purchases of the Fund's shares in amounts as little as $50 via an automatic
debit to a bank account or Prudential Securities account (including a Command
Account). For additional information about this service, you may contact your
Prudential Securities financial adviser, Prusec representative or the Transfer
Agent directly.

Tax Deferred Retirement Plans. Various tax-deferred retirement plans,
including a 401(k) plan, self-directed individual retirement accounts and
"tax-sheltered accounts" under Section 403(b)(7) of the Internal Revenue Code
are available through the Distributor. These plans are for use by both
self-employed individuals and corporate employers. These plans permit either
self-direction of accounts by participants, or a pooled account arrangement.
Information regarding the establishment of these plans, the administration,
custodial fees and other details is available from Prudential Securities or the
Transfer Agent. If you are considering adopting such a plan, you should consult
with your own legal or tax adviser with respect to the establishment and
maintenance of such a plan.

Systematic Withdrawal Plan. A systematic withdrawal plan is available to
shareholders which provides for monthly or quarterly checks. Withdrawals of
Class B and Class C shares may be subject to a CDSC. See "How to Sell Your
Shares--Contingent Deferred Sales Charges."

Reports to Shareholders. The Fund will send you annual and semi-annual
reports. The financial statements appearing in annual reports are audited by
independent accountants. In order to reduce duplicate mailing and printing
expenses the Fund will provide one annual report and semi-annual shareholder
report and annual prospectus per household. You may request additional copies of
such reports by calling (800) 225-1852 or by writing to the Fund at One Seaport
Plaza, New York, NY 10292. In addition, monthly unaudited financial data is
available upon request from the Fund.

Shareholder Inquiries. Inquiries should be addressed to the Fund at One
Seaport Plaza, New York, New York 10292, or by telephone, at 1-800-225-1852 or,
from outside the U.S.A., at 1-908-417-7555 (collect).

For additional information regarding the services and privileges described
above, see "Shareholder Investment Account" in the Statement of Additional
Information.

29
<PAGE>

THE PRUDENTIAL MUTUAL FUND FAMILY

Prudential Mutual Fund Management offers a broad range of mutual funds
designed to meet your individual needs. We welcome you to review the investment
options available through our family of funds. For more information on the
Prudential Mutual Funds, including charges and expenses, contact your Prudential
Securities financial adviser or Prusec representative or telephone the Fund at
1 (800) 225-1852 for a free prospectus. Read the prospectus carefully before you
invest or send money.

Taxable Bond Funds

Prudential Adjustable Rate Securities Fund, Inc.
Prudential GNMA Fund, Inc.
Prudential Government Income Fund, Inc.
Prudential Government Securities Trust
Intermediate Term Series
Prudential High Yield Fund, Inc.
Prudential Structured Maturity Fund, Inc.
Income Portfolio
Prudential U.S. Government Fund
The BlackRock Government Income Trust

Tax-Exempt Bond Funds

Prudential California Municipal Fund
California Series
California Income Series
Prudential Municipal Bond Fund
High Yield Series
Insured Series
Modified Term Series
Prudential Municipal Series Fund
Arizona Series
Florida Series
Georgia Series
Hawaii Income Series
Maryland Series
Massachusetts Series
Michigan Series
Minnesota Series
New Jersey Series
New York Series
North Carolina Series
Ohio Series
Pennsylvania Series
Prudential National Municipals Fund, Inc.

Global Funds

Prudential Europe Growth Fund, Inc.
Prudential Global Fund, Inc.
Prudential Global Genesis Fund, Inc.
Prudential Global Natural Resources Fund, Inc.
Prudential Intermediate Global Income Fund, Inc.
Prudential Pacific Growth Fund, Inc.
Prudential Short-Term Global Income Fund, Inc.
Global Assets Portfolio
Short-Term Global Income Portfolio
Global Utility Fund, Inc.

Equity Funds

Prudential Allocation Fund
Conservatively Managed Portfolio
Strategy Portfolio
Prudential Equity Fund, Inc.
Prudential Equity Income Fund
Prudential Growth Opportunity Fund, Inc.
Prudential IncomeVertible (R) Fund, Inc.
Prudential Multi-Sector Fund, Inc.
Prudential Strategist Fund, Inc.
Prudential Utility Fund, Inc.
Nicholas-Applegate Fund, Inc.
Nicholas-Applegate Growth Equity Fund

Money Market Funds

- - Taxable Money Market Funds
Prudential Government Securities Trust
Money Market Series
U.S. Treasury Money Market Series
Prudential Special Money Market Fund
Money Market Series
Prudential MoneyMart Assets
- - Tax-Free Money Market Funds
Prudential Tax-Free Money Fund
Prudential California Municipal Fund
California Money Market Series
Prudential Municipal Series Fund
Connecticut Money Market Series
Massachusetts Money Market Series
New Jersey Money Market Series
New York Money Market Series
- - Command Funds
Command Money Fund
Command Government Fund
Command Tax-Free Fund
- - Institutional Money Market Funds
Prudential Institutional Liquidity Portfolio, Inc.
Institutional Money Market Series

A-1
<PAGE>

No dealer, sales representative or any other person has been
authorized to give any information or to make any representations, other than
those contained in this Prospectus, in connection with the offer contained
herein, and, if given or made, such other information or representations must
not be relied upon as having been authorized by the Fund or the Distributor.
This Prospectus does not constitute an offer by the Fund or by the Distributor
to sell or a solicitation of any offer to buy any of the securities offered
hereby in any jurisdiction to any person to whom it is unlawful to make such
offer in such jurisdiction.
- --------------------------------------------------------------------------------

TABLE OF CONTENTS
Page
----
FUND HIGHLIGHTS .............................. 2
Risk Factors and Special Characteristics .... 2
FUND EXPENSES ................................ 4
FINANCIAL HIGHLIGHTS ......................... 5
HOW THE FUND INVESTS ......................... 8
Investment Objective and Policies ........... 8
Hedging and Income Enhancement Strategies ... 9
Other Investment Practices .................. 13
Special Considerations and Risks ............ 14
Investment Restrictions ..................... 14
HOW THE FUND IS MANAGED ...................... 15
Manager ..................................... 15
Distributor ................................. 15
Portfolio Transactions ...................... 17
Custodian and Transfer and Dividend Disbursing
Agent ...................................... 18
HOW THE FUND VALUES ITS SHARES ............... 18
HOW THE FUND CALCULATES PERFORMANCE .......... 18
TAXES, DIVIDENDS AND DISTRIBUTIONS ........... 19
GENERAL INFORMATION .......................... 20
Description of Common Stock ................. 20
Additional Information ...................... 21
SHAREHOLDER GUIDE ............................ 21
How to Buy Shares of the Fund ............... 21
Alternative Purchase Plan ................... 22
How to Sell Your Shares ..................... 24
How to Exchange Your Shares ................. 28
Shareholder Services ........................ 29
THE PRUDENTIAL MUTUAL FUND FAMILY ............ A-1
- -----------------------------------------------------
115A 444010J
CUSIP NOS.:
Class A: 744332107
Class B: 744332206
Class C: 744332305

Prudential
Global Fund, Inc.
-----------------

PROPECTUS January 3, 1995

Prudential Mutual Funds
BUILDING YOUR FUTURE
ON OUR STRENGTH
[LOGO]
<PAGE>

Prudential Mutual Funds
Supplement dated February 1, 1995
The following information supplements the Prospectus of each of the Funds
listed below effective February 1, 1995.

SHAREHOLDER GUIDE

HOW TO BUY SHARES OF THE FUND

All minimum investment requirements are waived for purchases made in
connection with the ``Best Minds'' program sponsored by the Distributor pursuant
to which the total dollar amount of a client's investment in the program will be
allocated equally among shares of the Fund and other Prudential Mutual Funds.
For more information about this program, you should contact your Prudential
Securities financial adviser or Prusec representative.

Listed below are the names of the Prudential Mutual Funds and the dates of
the Prospectuses to which this supplement relates.

Name of Fund Prospectus Date

Prudential Diversified Bond Fund, Inc...................... January 3, 1995
Prudential Equity Fund, Inc................................ August 1, 1994
Prudential Global Fund, Inc................................ January 3, 1995

MF950C-3

<PAGE>

Prudential Mutual Funds
Supplement dated May 5, 1995

The following information supplements the Prospectus of each ofthe Funds
listed below.

SHAREHOLDER GUIDE

ALTERNATIVE PURCHASE PLAN

Class A Shares--Reduction and Waiver of Initial Sales Charges

Other Waivers. Class A shares may be purchased at NAV, through Prudential
Securities or the Transfer Agent, by investors who have a business relationship
with a financial adviser who joined Prudential Securities from another
investment firm, provided that (i) the purchase is made within 90 days of the
commencement of the financial adviser's employment at Prudential Securities,
(ii) the purchase is made with proceeds of a redemption of shares of any
open-end, non-money market fund sponsored by the financial adviser's previous
employer (other than a fund which imposes a distribution or service fee .25 of
1% or less) and (iii) the financial adviser served as the client's broker on the
previous purchase.

HOW TO SELL YOUR SHARES

90-day Repurchase Privilege. If you redeem your shares and have not
previously exercised the repurchase privilege, you may reinvest any portion or
all of the proceeds of such redemption in shares of the Fund at the NAV next
determined after the order is received, which must be within 90 days after the
date of the redemption. No sales charge will apply to such repurchases. You will
receive pro rata credit for any contingent deferred sales charge paid in
connection with the redemption of Class B or Class C shares. You must notify the
Fund's Transfer Agent, either directly or through Prudential Securities or
Prusec, at the time the repurchase privilege is exercised that you are entitled
to credit for the contingent deferred sales charge previously paid. Exercise of
the repurchase privilege will generally not effect federal tax treatment of any
gain realized upon redemption. If the redemption resulted in a loss, some or all
of the loss, depending on the amount reinvested, will generally not be allowed
for federal income tax purposes.

<PAGE>

Listed below are the names of the Prudential Mutual Funds and the dates of
the Prospectuses to which this supplement relates.

Name of Fund Prospectus Date

Prudential Adjustable Rate Securities Fund, Inc. May 1, 1994
Prudential Allocation Fund September 29, 1994
Prudential California Municipal Fund
California Income Series December 30, 1994
California Series December 30, 1994
Prudential Equity Income Fund December 30, 1994
Prudential Global Fund, Inc. January 3, 1995
Prudential Global Genesis Fund, Inc. August 1, 1994
Prudential Global Natural Resources Fund, Inc. August 1, 1994
Prudential Multi-Sector Fund, Inc. August 1, 1994
Prudential Municipal Bond Fund August 1, 1994
Prudential Municipal Series Fund
Arizona Series December 30, 1994
Florida Series December 30, 1994
Georgia Series December 30, 1994
Maryland Series December 30, 1994
Massachusetts Series December 30, 1994
Michigan Series December 30, 1994
Minnesota Series December 30, 1994
New Jersey Series December 30, 1994
New York Series December 30, 1994
North Carolina Series December 30, 1994
Ohio Series December 30, 1994
Pennsylvania Series December 30, 1994
Prudential Pacific Growth Fund, Inc. January 3, 1995
Prudential Short-Term Global Income Fund, Inc.
Global Assets Portfolio January 3, 1995
Short-Term Global Income Fund January 3, 1995
Prudential Strategist Fund, Inc. August 1, 1994
Prudential U.S. Government Fund January 3, 1995
The BlackRock Government Income Trust November 1, 1994
(as supplemented
December 30, 1994)

MF950C-6

<PAGE>

Prudential Mutual Funds
Supplement dated July 3, 1995

The following information supplements the prospectuses of each of the Funds
listed on the reverse.

SHAREHOLDER GUIDE

HOW TO BUY SHARES OF THE FUND

Reduction and Waiver of Initial Sales Charges.

PruArray Plans. Class A shares may be purchased at NAV by certain retirement
and deferred compensation plans, qualified or non-qualified under the Internal
Revenue Code of 1986, as amended, (the Code), including pension, profit-sharing,
stock-bonus or other employee benefit plans under Section 401 of the Code and
deferred compensation and annuity plans under Sections 457 and 403(b)(7) of the
Code that participate in the Transfer Agent's PruArray Program (a benefit plan
record keeping service) (hereafter referred to as a PruArray Plan); provided (i)
that the plan has at least $1 million in existing assets or 1,000 eligible
employees or participants and (ii) that Prudential Mutual Funds constitute at
least one-half of the plan's investment options. The term "existing assets"
for this purpose includes stock issued by a PruArray Plan sponsor and shares of
non-money market Prudential Mutual Funds and shares of certain unaffiliated
non-money market mutual funds that participate in the PruArray Program
(Participating Funds). "Existing assets" also include shares of money market
funds acquired by exchange from a Participating Fund. After a PruArray Plan
qualifies to purchase Class A shares at NAV, all subsequent purchases will be
made at NAV.

<PAGE>

Listed below are the names of the Prudential Mutual Funds and the dates of
the prospectuses to which this supplement relates.

<TABLE>
<CAPTION>
Name of Fund Prospectus Date
<S> <C>
Prudential Adjustable Rate Securities Fund, Inc. June 26, 1995
Prudential Allocation Fund September 29, 1994
Prudential Diversified Bond Fund, Inc. January 3, 1995
(as supplemented June 20, 1995)
Prudential Equity Fund, Inc. February 28, 1995
Prudential Equity Income Fund December 30, 1994
Prudential Global Fund, Inc. January 3, 1995
Prudential Global Genesis Fund, Inc. August 1, 1994
Prudential Global Natural Resources Fund, Inc. August 1, 1994
Prudential GNMA Fund, Inc. March 2, 1995
Prudential Government Income Fund, Inc. May 1, 1995
Prudential Growth Opportunity Fund, Inc. February 1, 1995
Prudential High Yield Fund, Inc. February 28, 1995
Prudential IncomeVertible Fund, Inc. March 1, 1995
Prudential Intermediate Global Income Fund, Inc. March 2, 1995
Prudential Multi-Sector Fund, Inc. June 30, 1995
Prudential Pacific Growth Fund, Inc. January 3, 1995
Prudential Short-Term Global Income Fund, Inc.
Global Assets Portfolio January 3, 1995
Short-Term Global Income Fund January 3, 1995
Prudential Structured Maturity Fund, Inc. March 1, 1995
Prudential U.S. Government Fund January 3, 1995
Prudential Utility Fund, Inc. March 1, 1995
The BlackRock Government Income Trust November 1, 1994
(as supplemented December 30, 1994)
Global Utility Fund, Inc. February 1, 1995
Nicholas-Applegate Fund, Inc. March 6, 1995
</TABLE>

MF950C-7

<PAGE>

PRUDENTIAL GLOBAL FUND, INC.

Statement of Additional Information
January 3, 1995

Prudential Global Fund, Inc. (the Fund) is an open-end, diversified
management investment company. Its investment objective is to seek long-term
growth of capital, with income as a secondary objective. The Fund will seek to
achieve its objective through investment in a diversified portfolio of
securities which will consist of marketable securities of U.S. and non-U.S.
issuers. The Fund may invest in all types of common stocks and equivalents (such
as convertible debt securities and warrants), preferred stocks, bonds and other
debt obligations, including money market instruments, of foreign and domestic
companies and governments, governmental agencies and international
organizations. There can be no assurance that the Fund's investment objective
will be achieved. See "Investment Objective and Policies."

The Fund's address is One Seaport Plaza, New York, New York 10292, and its
telephone number is (800) 225-1852.

This Statement of Additional Information is not a prospectus and should be
read in conjunction with the Fund's Prospectus, dated January 3, 1995, a copy
of which may be obtained from the Fund at the address noted above.

TABLE OF CONTENTS

Cross-reference
to page in
Page Prospectus
------ ---------------

Investment Objective and Policies ................... B-2 8

Investment Restrictions ............................. B-10 14

Directors and Officers .............................. B-11 15

Manager ............................................. B-13 15

Distributor ......................................... B-15 15

Net Asset Value ..................................... B-17 18

Portfolio Transactions and Brokerage ................ B-17 17

Purchase and Redemption of Fund Shares .............. B-19 21

Shareholder Investment Account ...................... B-21 29

Performance Information ............................. B-25 18

Taxes ............................................... B-27 19

Custodian, Transfer and Dividend Disbursing
Agent and Independent Accountants ................. B-29 18

Financial Statements ................................ B-30 _

Independent Auditors' Report ........................ B-42 _

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

MF115B

<PAGE>

INVESTMENT OBJECTIVE AND POLICIES

The investment objective of the Fund is to seek long-term growth of
capital, with income as a secondary objective. The Fund will seek to achieve its
objective through investment in a diversified portfolio of securities which will
consist of marketable securities of U.S. and non-U.S. issuers. The Fund may
invest in all types of common stocks and equivalents (such as convertible debt
securities and warrants), preferred stocks, bonds and other debt
obligations,including money market instruments, of foreign and domestic
companies and governments, governmental agencies and international
organizations. The Fund has no fixed policy with respect to portfolio turnover;
however, it is anticipated that the Fund's annual portfolio turnover rate will
not normally exceed 100%,though the Fund is not restricted from investing in
short-term obligations. There can be no assurance that the Fund's investment
objective will be achieved. For a further description of the Fund's investment
objective and policies, see "How the Fund Invests--Investment Objective and
Policies" in the Prospectus.

Limitations on Purchase and Sale of Options, Options on Stock Indices and
Stock Index Futures

The Fund may write put and call options only if they are covered, and such
options must remain covered so long as the Fund is obligated as a writer. The
Fund will not write put options on indices. The Fund has undertaken with certain
state securities commissions that, so long as shares of the Fund are registered
in those states, it will not (a) write puts having aggregate exercise prices
greater than 25% of total net assets; or (b) purchase (i) put options on stocks
not held in the Fund's portfolio, (ii) put options on stock indices or (iii)call
options on stocks or stock indices if, after any such purchase, the aggregate
premiums paid for such options would exceed 20% of the Fund's total net assets.

Call Options. The Fund may, from time to time, write call options on its
portfolio securities. The Fund may write only call options which are "covered,"
meaning that the Fund either owns the underlying security or has an absolute and
immediate right to acquire that security, without additional cash consideration,
upon conversion or exchange of other securities currently held in its portfolio.
In addition, the Fund will not permit the call to become uncovered prior to the
expiration of the option or termination through a closing purchase transaction
as described below. If the Fund writes a call option, the purchaser of the
option has the right to buy (and the Fund has the obligation to sell) the
underlying security at the exercise price throughout the term of the option. The
amount paid to the Fund by the purchaser of the option is the "premium." The
Fund's obligation to deliver the underlying security against payment of the
exercise price would terminate either upon expiration of the option or earlier
if the Fund were to effect a "closing purchase transaction" through the purchase
of an equivalent option on an exchange. There can be no assurance that a closing
purchase transaction can be effected.

The Fund would not be able to effect a closing purchase transaction after
it had received notice of exercise. In order to write a call option, the Fund is
required to comply with the rules of The Options Clearing Corporation, with
respect to options traded on a United States exchange, and the various exchanges
with respect to collateral requirements. The Fund may not purchase call options
except in connection with a closing purchase transaction. It is possible that
the cost of effecting a closing purchase transaction may be greater than the
premium received by the Fund for writing the option.

Generally, the investment adviser intends to write listed covered call
options during periods when it anticipates declines in the market values of
portfolio securities because the premiums received may offset to some extent the
decline in the Fund's net asset value occasioned by such declines in market
value. Except as part of the "sell discipline" described below, the investment
adviser will generally not write listed covered call options when it anticipates
that the market values of the Fund's portfolio securities will increase.

One reason for the Fund to write call options is as part of a "sell
discipline." If the investment adviser decides that a portfolio security would
be overvalued and should be sold at a certain price higher than the current
price, the Fund could write an option on the security at the higher price.
Should the security subsequently reach that price and the option is exercised,
the Fund would, in effect, have increased the selling price of that security,
which it would have sold at that price in any event, by the amount of the
premium. In the event the market price of the security declined and the option
were not exercised, the premium would offset all or some portion of the decline.
It is possible that the price of the security could increase beyond the exercise
price; in that event, the Fund would forego the opportunity to sell the security
at that higher price.

In addition, call options may be used as part of a different strategy in
connection with sales of portfolio securities. If, in the judgment of the
investment adviser, the market price of a security is overvalued and it should
be sold, the Fund may elect to write a call option with an exercise price
substantially below the current market price. As long as the value of the
underlying security remains above the exercise price during the term of the
option, the option will, in all probability, be exercised, in which case the
Fund will be required to sell the security at the exercise price. If the sum of
the premium and the exercise price exceeds the market price of the security at
the time the call option is written, the Fund would, in effect, have increased
the selling price of the security. The Fund would not write a call option in
these circumstances if the sum of the premium and the exercise price were less
than the current market price of the security.

Put Options. The Fund may also write listed put options. If the Fund writes
a put option, it is obligated to purchase a given security at a specified price
at any time during the term of the option.

B-2

<PAGE>

Writing listed put options is a useful portfolio investment strategy when
the Fund has cash or other reserves available for investment as a result of
sales of Fund shares or, more importantly, because the investment adviser
believes a more defensive and less fully invested position is desirable in light
of market conditions. If the Fund wishes to invest its cash or reserves in a
particular security at a price lower than current market value, it may write a
put option on that security at an exercise price which reflects the lower price
it is willing to pay. The buyer of the put option generally will not exercise
the option unless the market price of the underlying security declines to a
price near or below the exercise price. If the Fund writes a listed put, the
price of the underlying security declines and the option is exercised, the
premium, net of transaction charges, will reduce the purchase price paid by the
Fund for the security. The price of the security may decline by an amount in
excess of the premium, in which event the Fund would have foregone an
opportunity to purchase the security at a lower price.

If, prior to the exercise of a put option, the investment adviser
determines that it no longer wishes to invest in the security on which the put
option had been written, the Fund may be able to effect a closing purchase
transaction on an exchange by purchasing a put option of the same series as the
one which it has previously written. The cost of effecting a closing purchase
transaction may be greater than the premium received on writing the put option
and there is no guarantee that a closing purchase transaction can be effected.

At the time a put option is written, the Fund will be required to
establish, and will maintain until the put is exercised or has expired, a
segregated account with its custodian consisting of cash, short-term U. S.
Government securities or other high-grade short-term debt obligations equal in
value to the amount the Fund will be obligated to pay upon exercise of the put
option.

Stock Index Options. Except as described below, the Fund will write call
options on indices only if on such date it holds a portfolio of stocks at least
equal to the value of the index times the multiplier times the number of
contracts. When the Fund writes a call option on a broadly-based stock market
index, the Fund will segregate or put into escrow with its Custodian, or pledge
to a broker as collateral for the option, one or more "qualified securities"
with a market value at the time the option is written of not less than 100% of
the current index value times the multiplier times the number of contracts.

If the Fund has written an option on an industry or market segment index,
it will segregate or put into escrow with its Custodian, or pledge to a broker
as collateral for the option, at least ten "qualified securities," which are
securities of an issuer in such industry or market segment, with a market value
at the time the option is written of not less than 100% of the current index
value times the multiplier times the number of contracts. Such securities will
include stocks which represent at least 50% of the weighting of the industry or
market segment index and will represent at least 50% of the Fund's holdings in
that industry or market segment. No individual security will represent more than
25% of the amount so segregated, pledged or escrowed. If at the close of
business on any day the market value of such qualified securities so segregated,
escrowed or pledged falls below 100% of the current index value times the
multiplier times the number of contracts, the Fund will so segregate, escrow or
pledge an amount in cash, Treasury bills or other high-grade short-term
obligations equal in value to the difference. In addition, when the Fund writes
a call on an index which is in-the-money at the time the call is written, the
Fund will segregate with its Custodian or pledge to the broker as collateral
cash, short-term U.S. Government securities or other high-grade short-term debt
obligations equal in value to the amount by which the call is in-the-money times
the multiplier times the number of contracts. Any amount segregated pursuant to
the foregoing sentence may be applied to the Fund's obligation to segregate
additional amounts in the event that the market value of the qualified
securities falls below 100% of the current index value times the multiplier
times the number of contracts. A "qualified security" is an equity security
which is listed on a national securities exchange or listed on the National
Association of Securities Dealers Automated Quotation System against which the
Fund has not written a stock call option and which has not been hedged by the
Fund by the sale of stock index futures. However, if the Fund holds a call on
the same index as the call written where the exercise price of the call held is
equal to or less than the exercise price of the call written or greater than the
exercise price of the call written if the difference is maintained by the Fund
in cash, Treasury bills or other high-grade short-term obligations in a
segregated account with its Custodian, it will not be subject to the
requirements described in this paragraph.

Stock Index Futures. The Fund will engage in transactions in stock index
futures contracts as a hedge against changes resulting from market conditions in
the values of securities which are held in the Fund's portfolio or which it
intends to purchase. The Fund will engage in such transactions when they are
economically appropriate for the reduction of risks inherent in the ongoing
management of the Fund. The Fund may not purchase or sell stock index futures
if, immediately thereafter, more than one-third of its net assets would be
hedged and, in addition, except as described above in the case of a call written
and held on the same index, will write call options on indices or sell stock
index futures only if the amount resulting from the multiplication of the then
current level of the index (or indices) upon which the option or future
contract(s) is based, the applicable multiplier(s), and the number of futures or
options contracts which would be outstanding, would not exceed one-third of the
value of the Fund's net assets. The Fund also may not purchase or sell stock
index futures for risk management purposes if, immediately thereafter, the sum
of the amount of margin deposits on the Fund's existing futures positions and
premiums paid for such options would exceed 5% of the liquidation value of the
Fund's total assets after taking into account unrealized profits and unrealized
losses on any such contracts, provided, however, that in the case of an option
that is in-the-money, the in-the-money amount may be excluded in

B-3

<PAGE>

computing such 5%. The above restriction does not apply to the purchase and sale
of stock index futures for bona fide hedging purposes. In instances involving
the purchase of stock index futures contracts by the Fund, an amount of cash,
short-term U.S. Government securities or other high-grade short-term debt
obligations, equal to the market value of the futures contracts, will be
deposited in a segregated account with the Fund's Custodian and/or in a margin
account with a broker to collateralize the position and thereby insure that the
use of such futures is unleveraged.

Under regulations of the Commodity Exchange Act, investment companies
registered under the Investment Company Act of 1940, as amended (the Investment
Company Act), are exempt from the definition of "commodity pool operator,"
subject to compliance with certain conditions. The exemption is conditioned upon
a requirement that all of the Fund's commodity futures or commodity options
transactions constitute bona fide hedging transactions within the meaning of the
CFTC's regulations. The Fund will use stock index futures and options on futures
as described herein in a manner consistent with this requirement. The Fund may
also enter into commodity futures or commodity options contracts for income
enhancement and risk management purposes if the aggregate initial margin and
option premiums do not exceed 5% of the liquidation value of the Fund's total
assets.

Risks of Transactions in Stock Options. Writing of options involves the
risk that there will be no market in which to effect a closing transaction. An
option position may be closed out only on an exchange which provides a secondary
market for an option of the same series. Although the Fund will generally write
only those options for which there appears to be an active secondary
market,there is no assurance that a liquid secondary market on an exchange will
exist for any particular option, or at any particular time, and for some options
no secondary market on an exchange may exist. If the Fund as a covered call
option writer is unable to effect a closing purchase transaction in a secondary
market, it will not be able to sell the underlying security until the option
expires or it delivers the underlying security upon exercise.

Risks of Options on Indices. The Fund's purchase and sale of options on
indices will be subject to risks described above under "Risks of Transactions in
Stock Options." In addition, the distinctive characteristics of options on
indices create certain risks that are not present with stock options.

Because the value of an index option depends upon movements in the level of
the index rather than the price of a particular stock, whether the Fund will
realize a gain or loss on the purchase or sale of an option on an index depends
upon movements in the level of stock prices in the stock market generally or in
an industry or market segment rather than movements in the price of a particular
stock. Accordingly, successful use by the Fund of options on indices would be
subject to the investment adviser's ability to predict correctly movements in
the direction of the stock market generally or of a particular industry. This
requires different skills and techniques than predicting changes in the price of
individual stocks.

Index prices may be distorted if trading of certain stocks included in the
index is interrupted. Trading in the index options also may be interrupted in
certain circumstances, such as if trading were halted in a substantial number of
stocks included in the index. If this occurred, the Fund would not be able to
close out options which it had purchased or written and, if restrictions on
exercise were imposed, may be unable to exercise an option it holds, which could
result in substantial losses to the Fund. It is the Fund's policy to purchase or
write options only on indices which include a number of stocks sufficient to
minimize the likelihood of a trading halt in the index.

Trading in index options commenced in April 1983 with the S&P 100 option
(formerly called the CBOE 100). Since that time a number of additional index
option contracts have been introduced including options on industry indices.
Although the markets for certain index option contracts have developed rapidly,
the markets for other index options are still relatively illiquid. The ability
to establish and close out positions on such options will be subject to the
development and maintenance of a liquid secondary market. It is not certain that
this market will develop in all index option contracts. The Fund will not
purchase or sell any index option contract unless and until, in the investment
adviser's opinion, the market for such options has developed sufficiently that
such risk in connection with such transactions is no greater than such risk in
connection with options on stocks.

Special Risks of Writing Calls on Indices. Because exercises of index
options are settled in cash, a call writer such as the Fund cannot determine the
amount of its settlement obligations in advance and, unlike call writing on
specific stocks, cannot provide in advance for, or cover, its potential
settlement obligations by acquiring and holding the underlying securities.
However, the Fund will write call options on indices only under the
circumstances described above under "Limitations on Purchase and Sale of
Options, Options on Stock Indices, Stock Index Futures and Options on Stock
Index Futures."

Price movements in the Fund's portfolio probably will not correlate
precisely with movements in the level of the index and, therefore, the Fund
bears the risk that the price of the securities held by the Fund may not
increase as much as the index. In such event, the Fund would bear a loss on the
call which is not completely offset by movements in the price of the Fund's
portfolio. It is also possible that the index may rise when the Fund's portfolio
of stocks does not rise. If this occurred, the Fund would experience a loss on
the call which is not offset by an increase in the value of its portfolio and
might also experience a loss in its portfolio. However, because the value of a
diversified portfolio will, over time, tend to move in the same direction as the
market, movements in the value of the Fund in the opposite direction as the
market would be likely to occur for only a short period or to a small degree.

B-4

<PAGE>

Unless the Fund has other liquid assets which are sufficient to satisfy the
exercise of a call, the Fund would be required to liquidate portfolio securities
in order to satisfy the exercise. Because an exercise must be settled within
hours after receiving the notice of exercise, if the Fund fails to anticipate an
exercise, it may have to borrow (in amounts not exceeding 20% of the Fund's
total assets) pending settlement of the sale of securities in its portfolio and
would incur interest charges thereon.

When the Fund has written a call, there is also a risk that the market may
decline between the time the Fund has a call exercised against it, at a price
which is fixed as of the closing level of the index on the date of exercise, and
the time the Fund is able to sell stocks in its portfolio. As with stock
options, the Fund will not learn that an index option has been exercised until
the day following the exercise date but, unlike a call on stock where the Fund
would be able to deliver the underlying securities in settlement, the Fund may
have to sell part of its stock portfolio in order to make settlement in cash,and
the price of such stocks might decline before they can be sold. This timing risk
makes certain strategies involving more than one option substantially more risky
with index options than with stock options. For example, even if an index call
which the Fund has written is "covered" by an index call held by the Fund with
the same strike price, the Fund will bear the risk that the level of the index
may decline between the close of trading on the date the exercise notice is
filed with the clearing corporation and the close of trading on the date the
Fund exercises the call it holds or the time the Fund sells the call which in
either case would occur no earlier than the day following the day the exercise
notice was filed.

Special Risks of Purchasing Puts and Calls on Indices. If the Fund holds an
index option and exercises it before final determination of the closing index
value for that day, it runs the risk that the level of the underlying index may
change before closing. If such a change causes the exercised option to fall
out-of-the-money, the Fund will be required to pay the difference between the
closing index value and the exercise price of the option (times the applicable
multiple) to the assigned writer. Although the Fund may be able to minimize this
risk by withholding exercise instructions until just before the daily cut off
time or by selling rather than exercising an option when the index level is
close to the exercise price, it may not be possible to eliminate this risk
entirely because the cut off times for index options may be earlier than those
fixed for other types of options and may occur before definitive closing index
values are announced.

Special Risks of Purchasing OTC Options. When the Fund writes an OTC
option, it generally will be able to close out the OTC option prior to its
expiration only by entering into a closing purchase transaction with the dealer
with which the Fund originally wrote the OTC option. Any such cancellation, if
agreed to, may require the Fund to pay a premium to the counterparty. While the
Fund will enter into OTC options only with dealers which agree to, and which are
expected to be capable of, entering into closing transactions with the
Fund,there can be no assurance that the Fund will be able to liquidate an OTC
option at a favorable price at any time prior to expiration. Until the Fund is
able to effect a closing purchase transaction in a covered OTC call option the
Fund has written, it will not be able to liquidate securities used as cover
until the option expires or is exercised or different cover is substituted.
Alternatively,the Fund could write an OTC call option to, in effect, close an
existing OTC call option or write an OTC put option to close its position on an
OTC put option. However, the Fund would remain exposed to each counterparty's
credit risk on the put or call until such option is exercised or expires. There
is no guarantee that the Fund will be able to write put or call options, as the
case may be, that would effectively close an existing position. In the event of
insolvency of the counterparty, the Fund may be unable to liquidate an OTC
option.

In entering into OTC options, the Fund will be exposed to the risk that the
counterparty will default on, or be unable to complete, due to bankruptcy or
otherwise, its obligation on the option. In such event, the Fund may lose the
benefit of the transaction. The value of an OTC option to the Fund is dependent
upon the financial viability of the counterparty. If the Fund decides to enter
into transactions in OTC options, the Adviser will take into account the credit
quality of counter parties in order to limit the risk of default by the
counterparty.

OTC options may also be illiquid securities with respect to which no
secondary market exists. Similarly, the assets used to "cover" OTC options
written by the Fund will be treated as illiquid. OTC options are sold to
qualified dealers who agree that the Fund may repurchase any OTC options it
writes for a maximum price to be calculated by a formula set forth in the option
agreement. The "cover" for an OTC option written subject to this procedure would
be considered illiquid only to the extent that the maximum repurchase price
under the formula exceeds the intrinsic value of the option. Accordingly, to the
extent that OTC options are illiquid securities, investments in illiquid OTC
options will be subject to the limitations applicable to investments in illiquid
securities. See "Investment Restrictions."

Forward Foreign Currency Exchange Contracts

Since investments in foreign companies will usually involve currencies of
foreign countries, and since the Fund may temporarily hold funds in bank
deposits in foreign currencies during the completion of investment programs, the
value of the assets of the Fund as measured in U.S. dollars may be affected
favorably or unfavorably by changes in foreign currency exchange rates and
exchange control regulations, and the Fund may incur costs in connection with
conversions between various currencies. The Fund will conduct its foreign
currency exchange transactions either on a spot (i.e., cash) basis at the spot
rate prevailing in the foreign currency exchange market, or through entering
into forward contracts to purchase or sell foreign

B-5

<PAGE>

currencies. A forward foreign currency exchange contract involves an obligation
to purchase or sell a specific currency at a future date, which may be any fixed
number of days from the date of the contract agreed upon by the parties, at a
price set at the time of the contract. These contracts are traded in the inter
bank market conducted directly between currency traders (usually large
commercial banks) and their customers. A forward contract generally has no
deposit requirement, and no commissions are charged at any stage for such
trades.

The Fund may enter into forward foreign currency exchange contracts in
several circumstances. When the Fund enters into a contract for the purchase or
sale of a security denominated in a foreign currency, or when the Fund
anticipates the receipt in a foreign currency of dividends or interest payments
on a security which it holds, the Fund may desire to "lock-in" the U.S. dollar
price of the security or the U.S. dollar equivalent of such dividend or interest
payment, as the case may be. By entering into a forward contract for a fixed
amount of dollars, for the purchase or sale of the amount of foreign currency
involved in the underlying transactions, the Fund will be able to protect itself
against a possible loss resulting from an adverse change in the relationship
between the U.S. dollar and the subject foreign currency during the period
between the date on which the security is purchased or sold, or on which the
dividend or interest payment is declared, and the date on which such payments
are made or received.

Additionally, when management of the Fund believes that the currency of a
particular foreign country may suffer a substantial decline against the U.S.
dollar, the Fund may enter into a forward contract for a fixed amount of
dollars, to sell the amount of foreign currency approximating the value of some
or all of the Fund's portfolio securities denominated in such foreign currency.
The precise matching of the forward contract amounts and the value of the
securities involved will not generally be possible since the future value of
securities in foreign currencies will change as a consequence of market
movements in the value of those securities between the date on which the forward
contract is entered into and the date it matures. The projection of short-term
currency market movement is extremely difficult, and the successful execution of
a short-term hedging strategy is highly uncertain. The Fund will not enter into
such forward contracts or maintain a net exposure to such contracts where the
consummation of the contracts would obligate the Fund to deliver an amount of
foreign currency in excess of the value of the Fund's portfolio securities or
other assets denominated in that currency. Under normal circumstances,
consideration of the prospect for currency parities will be incorporated into
the long-term investment decisions made with regard to overall diversification
strategies. However, the Fund believes that it is important to have the
flexibility to enter into such forward contracts when it determines that the
best interests of the Fund will thereby be served. The Fund's Custodian will
place cash or liquid equity or debt securities into a segregated account of the
Fund in an amount equal to the value of the Fund's total assets committed to the
consummation of forward foreign currency exchange contracts. If the value of the
securities placed in the segregated account declines, additional cash or
securities will be placed in the account on a daily basis so that the value of
the account will equal the amount of the Fund's commitments with respect to such
contracts.

The Fund generally will not enter into a forward contract with a term of
greater than one year. At the maturity of a forward contract, the Fund may
either sell the portfolio security and make delivery of the foreign currency, or
it may retain the security and terminate its contractual obligation to deliver
the foreign currency by purchasing an "offsetting" contract with the same
currency trader obligating it to purchase, on the same maturity date, the same
amount of the foreign currency.

It is impossible to forecast with absolute precision the market value of a
particular portfolio security at the expiration of the contract. Accordingly, it
may be necessary for the Fund to purchase additional foreign currency on the
spot market (and bear the expense of such purchase) if the market value of the
security is less than the amount of foreign currency that the Fund is obligated
to deliver and if a decision is made to sell the security and make delivery of
the foreign currency.

If the Fund retains the portfolio security and engages in an offsetting
transaction, the Fund will incur a gain or a loss (as described below) to the
extent that there has been movement in forward contract prices. Should forward
prices decline during the period between the Fund's entering into a forward
contract for the sale of a foreign currency and the date it enters into an
offsetting contract for the purchase of the foreign currency, the Fund will
realize a gain to the extent that the price of the currency it has agreed to
sell exceeds the price of the currency it has agreed to purchase. Should forward
prices increase, the Fund will suffer a loss to the extent that the price of the
currency it has agreed to purchase exceeds the price of the currency it has
agreed to sell.

The Fund's dealing in forward foreign currency exchange contracts will be
limited to the transactions described above. Of course, the Fund is not required
to enter into such transactions with regard to its foreign currency-denominated
securities. It also should be realized that this method of protecting the value
of the Fund's portfolio securities against a decline in the value of a currency
does not eliminate fluctuations in the underlying prices of the securities which
are unrelated to exchange rates. It simply establishes a rate of exchange which
one can achieve at some future point in time. Additionally, although such
contracts tend to minimize the risk of loss due to a decline in the value of the
hedged currency, at the same time, they tend to limit any potential gain which
might result should the value of such currency increase.

Although the Fund values its assets daily in terms of U.S. dollars, it does
not intend physically to convert its holdings of foreign currencies into U.S.
dollars on a daily basis. It will do so from time to time, and investors should
be aware of the costs of

B-6

<PAGE>

currency conversion. Although foreign exchange dealers do not charge a fee for
conversion, they do realize a profit based on the difference (the spread)
between the prices at which they are buying and selling various currencies.
Thus, a dealer may offer to sell a foreign currency to the Fund at one rate,
while offering a lesser rate of exchange should the Fund desire to resell that
currency to the dealer.

Risks of Transactions in Options on Foreign Currencies

An option position may be closed out only on an exchange, board of trade or
other trading facility which provides a secondary market for an option of the
same series. Although the Fund will generally purchase or write only those
options for which there appears to be an active secondary market, there is no
assurance that a liquid secondary market on an exchange will exist for any
particular option, or at any particular time, and for some options no secondary
market on an exchange or otherwise may exist. In such event it might not be
possible to effect closing transactions in particular options, with the result
that the Fund would have to exercise its options in order to realize any profits
and would incur brokerage commissions upon the exercise of call options and upon
the subsequent disposition of underlying currencies acquired through the
exercise of call options or upon the purchase of underlying currencies for the
exercise of put options. If the Fund as a covered call option writer is unable
to effect a closing purchase transaction in a secondary market, it will not be
able to sell the underlying currency until the option expires or it delivers the
underlying currency upon exercise.

Reasons for the absence of a liquid secondary market on an exchange include
the following: (i) there may be insufficient trading interest in certain
options; (ii) restrictions may be imposed by an exchange on opening transactions
or closing transactions or both; (iii) trading halts, suspensions or other
restrictions may be imposed with respect to particular classes or series of
options; (iv) unusual or unforeseen circumstances may interrupt normal
operations on an exchange; (v) the facilities of an exchange or a clearing
corporation may not at all times be adequate to handle current trading volume;
or (vi) one or more exchanges could, for economic or other reasons, decide or be
compelled at some future date to discontinue the trading of options (or a
particular class or series of options), in which event the secondary market on
that exchange (or in the class or series of options) would cease to exist,
although outstanding options on that exchange that had been issued by a clearing
corporation as a result of trades on that exchange would continue to be
exercisable in accordance with their terms. There is no assurance that higher
than anticipated trading activity or other unforeseen events might not, at
times, render certain of the facilities of any of the clearing corporations
inadequate, and thereby result in the institution by an exchange of special
procedures which may interfere with the timely execution of customers' orders.
The Fund intends to purchase and sell only those options which are cleared by a
clearinghouse whose facilities are considered to be adequate to handle the
volume of options transactions.

Risks of Options on Foreign Currencies

Options on foreign currencies involve the currencies of two nations and
therefore, developments in either or both countries can affect the values of
options on foreign currencies. Risks include those described in the Prospectus
under "How the Fund Invests--Special Considerations and Risks," including
government actions affecting currency valuation and the movements of currencies
from one country to another. The quality of currency underlying option contracts
represent odd lots in a market dominated by transactions between banks; this can
mean extra transaction costs upon exercise. Options markets may be closed while
round-the-clock interbank currency markets are open, and this can create price
and rate discrepancies.

Risks of Transactions in Futures Contracts

There are several risks in connection with the use of futures contracts as
a hedging device. Due to the imperfect correlation between the price of futures
contracts and movements in the currency or group of currencies, the price of a
futures contract may move more or less than the price of the currencies being
hedged. Therefore, a correct forecast of currency rates, market trends or
international political trends by the Manager or Subadviser may still not result
in a successful hedging transaction.

Although the Fund will purchase or sell futures contracts only on exchanges
where there appears to be an adequate secondary market, there is no assurance
that a liquid secondary market on an exchange will exist for any particular
contract or at any particular time. Accordingly, there can be no assurance that
it will be possible, at any particular time, to close a futures position. In the
event the Fund could not close a futures position and the value of such position
declined, the Fund would be required to continue to make daily cash payments of
variation margin. There is no guarantee that the price movements of the
portfolio securities denominated in foreign currencies will, in fact, correlate
with the price movements in the futures contracts and thus provide an offset to
losses on a futures contract. Currently, futures contracts are available on the
Australian Dollar, British Pound, Canadian Dollar, Japanese Yen, Swiss Franc,
DeutscheMark and Eurodollar.

Under regulations of the Commodity Exchange Act, investment companies
registered under the Investment Company Act are exempt from the definition of
"commodity pool operator," subject to compliance with certain conditions. The
exemption is conditioned upon a requirement that all of the Fund's futures or
options transactions constitute bona fide hedging transactions within the
meaning of the Commodity Futures Trading Commission's (CFTC's) regulations. The
Fund will use currency futures and

B-7

<PAGE>

options on futures in a manner consistent with this requirement. The Fund may
also enter into futures or related options contracts for income enhancement and
risk management purposes if the aggregate initial margin and option premiums do
not exceed 5% of the liquidation value of the Fund's total assets.

Successful use of futures contracts by the Fund is also subject to the
ability of the Fund's Manager or Subadviser to predict correctly movements in
the direction of markets and other factors affecting currencies generally. For
example, if the Fund has hedged against the possibility of an increase in the
price of securities in its portfolio and price of such securities increases
instead, the Fund will lose part or all of the benefit of the increased value of
its securities because it will have offsetting losses in its futures positions.
In addition, in such situations, if the Fund has insufficient cash to meet daily
variation margin requirements, it may need to sell securities to meet such
requirements. Such sales of securities may be, but will not necessarily be, at
increased prices which reflect the rising market. The Fund may have to sell
securities at a time when it is disadvantageous to do so.

The hours of trading of futures contracts may not conform to the hours
during which the Fund may trade the underlying securities. To the extent that
the futures markets close before the securities markets, significant price and
rate movements can take place in the securities markets that cannot be reflected
in the futures markets.

Options on Futures Contracts

An option on a futures contract gives the purchaser the right, but not the
obligation, to assume a position in a futures contract (a long position if the
option is a call and a short position if the option is a put) at a specified
exercise price at any time during the option exercise period. The writer of the
option is required upon exercise to assume an offsetting futures position (a
short position if the option is a call and a long position if the option is a
put). Upon exercise of the option, the assumption of offsetting futures
positions by the writer and holder of the option will be accompanied by delivery
of the accumulated cash balance in the writer's futures margin account which
represents the amount by which the market price of the futures contract, at
exercise, exceeds, in the case of a call, or is less than, in the case of a
put, the exercise price of the option on the futures contract. Currently options
can be purchased or written with respect to futures contracts on the Australian
Dollar, British Pound, Canadian Dollar, Japanese Yen, Swiss Franc, DeutscheMark
and Eurodollar.

The holder or writer of an option may terminate its position by selling or
purchasing an option of the same series. There is no guarantee that such closing
transactions can be effected.

Limitations on Purchase and Sale of Options on Foreign Currencies and Futures
Contracts on Foreign Currencies

The Fund will write put options on foreign currencies and futures contracts
on foreign currencies only if they are covered by segregating with the Fund's
Custodian an amount of cash or short-term investments equal to the aggregate
exercise price of the puts. The Fund will not (a) write puts having aggregate
exercise prices greater than 25% of total net assets; or (b) purchase (i) put
options on currencies or futures contracts on foreign currencies or (ii) call
options on foreign currencies if, after any such purchase, the aggregate
premiums paid for such options would exceed 10% of the Fund's total net assets.

The Fund intends to engage in futures contracts and options on futures
transactions as a hedge against changes in the value of the currencies to which
the Fund is subject or to which the Fund expects to be subject in connection
with future purchases. The Fund also intends to engage in such transactions when
they are economically appropriate for the reduction of risks inherent in the
ongoing management of the Fund.

Illiquid Securities

The Fund may not invest more than 5% of its net assets in repurchase
agreements which have a maturity of longer than seven days or in other illiquid
securities, including securities that are illiquid by virtue of the absence of a
readily available market (either within or outside of the United States) or
legal or contractual restrictions on resale. Historically, illiquid securities
have included securities subject to contractual or legal restrictions on resale
because they have not been registered under the Securities Act of 1933, as
amended (Securities Act), securities which are otherwise not readily marketable
and repurchase agreements having a maturity of longer than seven days.
Securities which have not been registered under the Securities Act are referred
to as private placements or restricted securities and are purchased directly
from the issuer or in the secondary market. Mutual funds do not typically hold a
significant amount of these restricted or other illiquid securities because of
the potential for delays on resale and uncertainty in valuation. Limitations on
resale may have an adverse effect on the marketability of portfolio securities
and a mutual fund might be unable to dispose of restricted or other illiquid
securities promptly or at reasonable prices and might thereby experience
difficulty satisfying redemptions within seven days. A mutual fund might also
have to register such restricted securities in order to dispose of them
resulting in additional expense and delay. Adverse market conditions could
impede such a public offering of securities.

In recent years, however, a large institutional market has developed for
certain securities that are not registered under the Securities Act including
repurchase agreements, commercial paper, foreign securities, municipal
securities, convertible

B-8

<PAGE>

securities and corporate bonds and notes. Institutional investors depend on an
efficient institutional market in which the unregistered security can be readily
resold or on an issuer's ability to honor a demand for repayment. The fact that
there are contractual or legal restrictions on resale to the general public or
to certain institutions may not be indicative of the liquidity of such
investments.

Rule 144A under the Securities Act allows for a broader institutional
trading market for securities otherwise subject to restriction on resale to the
general public. Rule 144A establishes a "safe harbor" from the registration
requirements of the Securities Act for resales of certain securities to
qualified institutional buyers. The investment adviser anticipates that the
market for certain restricted securities such as institutional commercial paper
and foreign securities will expand further as a result of this regulation and
the development of automated systems for the trading, clearance and settlement
of unregistered securities of domestic and foreign issuers, such as the PORTAL
System sponsored by the National Association of Securities Dealers, Inc.

Restricted securities eligible for resale pursuant to Rule 144A under the
Securities Act and commercial paper for which there is a readily available
market will not be deemed to be illiquid. The investment adviser will monitor
the liquidity of such restricted securities subject to the supervision of the
Board of Directors. In reaching liquidity decisions, the investment adviser will
consider, inter alia, the following factors: (1) the frequency of trades and
quotes for the security; (2) the number of dealers wishing to purchase or sell
the security and the number of other potential purchasers; (3) dealer
undertakings to make a market in the security and (4) the nature of the security
and the nature of the marketplace trades (e.g., the time needed to dispose of
the security, the method of soliciting offers and the mechanics of the
transfer). In addition, in order for commercial paper that is issued in reliance
on Section 4(2) of the Securities Act to be considered liquid, (i) it must be
rated in one of the two highest rating categories by at least two nationally
recognized statistical rating organizations (NRSRO), or if only one NRSRO rates
the securities, by that NRSRO, or, if unrated, be of comparable quality in the
view of the investment adviser; and (ii) it must not be "traded flat" (i.e.
without accrued interest) or in default as to principal or interest. Repurchase
agreements subject to demand are deemed to have a maturity equal to the notice
period.

Position Limits

Transactions by the Fund in futures contracts and options will be subject
to limitations, if any, established by each of the exchanges, boards of trade or
other trading facilities (including NASDAQ) governing the maximum number of
options in each class which may be written or purchased by a single investor or
group of investors acting in concert, regardless of whether the options are
written on the same or different exchanges, boards of trade or other trading
facilities or are held or written in one or more accounts or through one or more
brokers. Thus, the number of futures contracts and options which the Fund may
write or purchase may be affected by the futures contracts and options written
or purchased by other investment advisory clients of the Adviser. An exchange,
board of trade or other trading facility may order the liquidations of positions
found to be in excess of these limits, and it may impose certain other
sanctions.

When-Issued and Delayed Delivery Securities

The Fund may purchase or sell securities on a when-issued or delayed
delivery basis. When-issued or delayed delivery transactions arise when
securities are purchased or sold by the Fund with payment and delivery taking
place in the future in order to secure what is considered to be an advantageous
price and yield to the Fund at the time of entering into the transaction. The
Fund's Custodian will maintain, in a segregated account of the Fund, cash, U.S.
Government securities or other liquid high-grade debt obligations having a value
equal to or greater than the Fund's purchase commitments; the Custodian will
likewise segregate securities sold on a delayed delivery basis.

B-9

<PAGE>

INVESTMENT RESTRICTIONS

The following restrictions are fundamental policies. Fundamental policies
are those which cannot be changed without the approval of the holders of a
majority of the Fund's outstanding voting securities. A "majority of the Fund's
outstanding voting securities," when used in this Statement of Additional
Information, means the lesser of (i) 67% of the voting shares represented at a
meeting at which more than 50% of the outstanding voting shares are present in
person or represented by proxy or (ii) more than 50% of the outstanding voting
shares.

The Fund may not:

1. Purchase securities on margin (but the Fund may obtain such short-term
credits as may be necessary for the clearance of transactions); provided that
the deposit or payment by the Fund of initial or maintenance margin in
connection with futures or options is not considered the purchase of a security
on margin.

2. Make short sales of securities or maintain a short position.

3. Issue senior securities, borrow money or pledge its assets, except that
the Fund may borrow up to 20% of the value of its total assets (calculated when
the loan is made) for temporary, extraordinary or emergency purposes or for the
clearance of transactions. The Fund may pledge up to 20% of the value of its
total assets to secure such borrowings. For the purpose of this restriction,
obligations of the Fund to Directors pursuant to deferred compensation
arrangements, the purchase and sale of securities on a when-issued or delayed
delivery basis, the purchase and sale of forward foreign exchange contracts,
options and futures contracts and any collateral arrangements with respect to
the purchase and sale of forward foreign exchange contracts, options and futures
contracts are not deemed to be the issuance of a senior security or a pledge of
assets.

4. Purchase any security (other than obligations of the U.S. Government,
its agencies, or instrumentalities) if as a result: (i) with respect to 75% of
the Fund's total assets, more than 5% of the Fund's total assets (taken at
current value) would then be invested in securities of a single issuer, or (ii)
more than 25% of the Fund's total assets (taken at current value) would be
invested in a single industry.

5. Purchase any security if as a result the Fund would then hold more than
10% of the outstanding voting securities of an issuer.

6. Purchase any security if as a result the Fund would then have more than
5% of its total assets (taken at current value) invested in securities of
companies (including predecessors) less than three years old.

7. Buy or sell commodities or commodity contracts or real estate or invest
in real estate, although it may purchase or sell securities which are secured by
real estate and securities of companies which invest or deal in real estate (for
the purposes of this restriction, stock options, options on debt securities,
options on stock indices, stock indices futures, options on stock index futures,
futures contracts on currencies, options on such contracts and forward foreign
exchange contracts are not deemed to be a commodity or commodity contract).

8. Act as underwriter except to the extent that, in connection with the
disposition of portfolio securities, it may be deemed to be an underwriter under
certain federal securities laws.

9. Make investments for the purpose of exercising control or management.

10. Invest in securities of other registered investment companies, except
by purchases in the open market involving only customary brokerage commissions
and as a result of which not more than 5% of its total assets (taken at current
value) would be invested in such securities, or except as part of a merger,
consolidation or other acquisition.

11. Invest in interests in oil, gas or other mineral exploration or
development programs, although it may invest in the common stocks of companies
which invest in or sponsor such programs.

12. Make loans, except through (i) repurchase agreements and (ii) loans of
portfolio securities (limited to 10% of the Fund's total assets).

13. Purchase warrants if as a result the Fund would then have more than 5%
of its total assets (taken at current value) invested in warrants.

Although not fundamental policies, the Fund has agreed with various state
securities commissions that the Fund will not (i) invest in securities of any
issuer if, to the knowledge of the Fund, any officer or director of the Fund or
of the Manager owns more than 1/2 of 1% of the outstanding securities of such
issuer, and such officers and directors who own more than 1/2 of 1% own in the
aggregate more than 5% of the outstanding securities of such issuer and, (ii)
purchase warrants if, as a result, the Fund would have more than 5% of its
assets (determined at the time of investment) invested in warrants, (warrants
will be valued at the lower of cost or market and investment in warrants which
are not listed on the New York Stock Exchange, American Stock Exchange or any
major foreign stock exchange will be limited to 2% of the Fund's net assets),
(iii) invest in securities of issuers which are restricted as to disposition, if
more than 15% of its total assets would be invested in such securities (this
restriction shall not apply to mortgage-backed securities, asset-backed
securities or obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities) or (iv) invest more than 5% of its total assets
in securities of unseasoned issuers, including their predecessors, which have
been in operation for less than three years, and in equity securities of issuers
which are not readily marketable.

B-10

<PAGE>

Whenever any fundamental investment policy or investment restriction states
a maximum percentage of the Fund's assets, it is intended that if the percentage
limitation is met at the time the investment is made, a later change in
percentage resulting from changing total or net asset values will not be
considered a violation of such policy. However, in the event that the Fund's
asset coverage for borrowings falls below 300%, the Fund will take prompt action
to reduce its borrowings, as required by applicable law.

DIRECTORS AND OFFICERS

Position with Principal Occupations
Name and Address Fund During Past Five Years
- ---------------- ------------- ----------------------
<S> <C> <C>

Stephen C. Eyre Director Executive Director, The John A. Hartford Foundation, Inc. (charitable
c/o Prudential Mutual Fund foundation) (since May 1985); Director of Faircom, Inc.
Management, Inc.
One Seaport Plaza
New York, NY

Delayne Dedrick Gold Director Marketing and Management Consultant.
c/o Prudential Mutual Fund
Management, Inc.
One Seaport Plaza
New York, NY

Don G. Hoff Director Chairman and Chief Executive Officer of Intertec, Inc. (investments)
c/o Prudential Mutual Fund since 1980; Director of Innovative Capital Management, Inc. The
Management, Inc. Asia Pacific Fund and The Greater China Fund.
One Seaport Plaza
New York, NY

*Harry A. Jacobs, Jr. Director Senior Director (since January 1986) of Prudential Securities
One Seaport Plaza Incorporated (Prudential Securities); formerly Interim Chairman
New York, NY and Chief Executive Officer of Prudential Mutual Fund Management
Inc. (PMF); (June-September 1993); formerly Chairman of the Board
of Prudential Securities (1982-1985); Chairman and Chief Executive
Officer of Bache Group Inc. (1977-1982); Trustee of The Trudeau
Institute; Director of The First Australia Fund, Inc., The First
Australia Prime Income Fund, Inc., The Global Government Plus Fund,
Inc., The Global Total Return Fund, Inc. and the Center for National Policy.

Sidney R. Knafel Director Managing Partner of SRK Management Company (investments) since
c/o Prudential Mutual Fund 1981; Chairman of Insight Communications Company, L.P. and
Management, Inc. Microbiological Associates, Inc.; Director of Cellular
One Seaport Plaza Communications, Inc., Cellular Communications International,
New York, NY Inc., Cellular Communications of Puerto Rico, Inc., General
American Investors Company, Inc., IGENE Biotechnology, Inc.,
International CableTel Incorporated, Medical Imaging Centers of
America, Inc. and a number of private companies.

Robert E. LaBlanc Director President of Robert E. LaBlanc Associates, Inc. (telecommunications)
c/o Prudential Mutual Fund since 1981; Director of Contel Cellular, Inc., M/A-COM, Inc.,
Management, Inc. Storage Technology Corporation, TIE/communications, Inc.,
One Seaport Plaza Tribune Company, Trustee of Manhattan College and Prudential
New York, NY U.S. Government Fund.

*Lawrence C. McQuade President and Vice Chairman of PMF (since 1988) and Managing Director,
One Seaport Plaza Director Investment Banking of Prudential Securities (1988-1991); Director
New York, NY of Czech & Slovak American Enterprise Fund (since October
1994), BUNZL, P.L.C. (since June 1991), and Quixote Corporation
(since February 1992); formerly Director of Crazy Eddie Inc. (1987-
1990) of Kaiser Tech, Ltd., Kaiser Aluminum and Chemical Corp.
(March 1987-November 1988); formerly Executive Vice President
and Director of W. R. Grace & Co. (1975-1987); President and
Director of The High Yield Income Fund, Inc., The Global Total Return
Fund, Inc. and The Global Government Plus Fund, Inc.

<FN>

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

* "Interested" director, as defined in the Investment Company Act, by reason of
his affiliation with Prudential or PMF.

</FN>
</TABLE>

B-11

Position with Principal Occupations
Name and Address Fund During Past Five Years
- ---------------- ------------- ----------------------
<S> <C> <C>

Thomas A. Owens, Jr. Director Consultant.
c/o Prudential Mutual Fund
Management, Inc.
One Seaport Plaza
New York, NY

*Richard A. Redeker Director President, Chief Executive Officer and Director (since October 1993),
One Seaport Plaza PMF; Executive Vice President; Director and Member of the
New York, NY Operating Committee (since October 1993); Prudential Securities
Incorporated (Prudential Securities); Director (since October 1993)
of Prudential Securities Group, Inc. (PSG); Vice President, The
Prudential Investment Corporation (since July 1994); formerly
Senior Executive Vice President and Director of Kemper Financial
Services, Inc. (September 1978-September 1993); Director of The
Global Government Plus Fund, Inc., The Global Total Return Fund,
Inc. and The High Yield Income Fund, Inc.

Clay T. Whitehead Director President of National Exchange Inc. (since May 1983).
c/o Prudential Mutual Fund
Management, Inc.
One Seaport Plaza
New York, NY

David W. Drasnin Vice President Vice President and Branch Manager of Prudential Securities.
39 Public Square,
Suite 500 Wilkes Barre, PA

Robert F. Gunia Vice President Chief Administrative Officer (since July 1990), Director (since January
One Seaport Plaza 1989) and Executive Vice President, Treasurer and Chief Financial
New York, NY Officer (since June 1987) of PMF; Senior Vice President (since
March 1987) of Prudential Securities; Vice President and Director (since
May 1989) of The Asia Pacific Fund, Inc.

S. Jane Rose Secretary Senior Vice President (since January 1991), Senior Counsel (since June
One Seaport Plaza 1987) and First Vice President (June 1987-December 1990) of
New York, NY PMF; Senior Vice President and Senior Counsel of Prudential
Securities (since July 1992); formerly Vice President and Associate General
Counsel of Prudential Securities.

Susan C. Cote Treasurer and Senior Vice President (since January 1989) of PMF; Senior Vice
One Seaport Plaza Principal President (since January 1992) and Vice President (January 1986-
New York, NY Financial and December 1991) of Prudential Securities.
Accounting
Officer

<FN>

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

* "Interested" director, as defined in the Investment Company Act, by reason of
his affiliation with Prudential or PMF.

</FN>
</TABLE>

B-12

<PAGE>

Directors and officers of the Fund are also trustees, directors and
officers of some or all of the other investment companies distributed by
Prudential Securities or Prudential Mutual Fund Distributors, Inc. (PMFD).

The officers conduct and supervise the daily business operations of the
Fund, while the Directors, in addition to their functions set forth under
"Manager" and "Distributor," review such actions and decide on general policy.
The Fund pays each of its Directors who is not an "affiliated" person of PMF
annual compensation of $12,000, in addition to certain out-of-pocket expenses.
The chairman of the Audit Committee receives an additional $4,000 per year.

Directors may receive their Directors' fees pursuant to a deferred fee
agreement with the Fund. Under the terms of such agreement, the Fund accrues
daily the amount of Directors' fees which accrue interest at a rate equivalent
to the prevailing rate applicable to 90-day U.S. Treasury Bills at the beginning
of each calendar quarter or, pursuant to an SEC exemptive order, at the daily
rate of return of the Fund (the Fund rate). Payment of the interest so accrued
is also deferred and accruals become payable at the option of the Director. The
Fund's obligation to make payments of deferred Directors' fees, together with
interest thereon, is a general obligation of the Fund.

As of December 2, 1994, the Directors and officers of the Fund, as a group,
owned less than 1% of the outstanding common stock of the Fund.

As of December 2, 1994, the only beneficial owners, directly or indirectly,
of more than 5% of the outstanding common stock of the Fund were Cirignano
Contracting, P.O. Box 145, Absecon, NJ 08201-0145, which held 10,359 shares of
Class C common stock (11.0%); and Pacific Acoustics North Inc., 133 East Ortega
Street, Santa Barbara, CA 93101-1699, which held 7,564 shares of Class C common
stock (8.0%).

As of December 2, 1994, Prudential Securities was the record holder for
other beneficial owners of 1,572,369 Class A shares (or 32% of the outstanding
Class A shares), 18,372,110 Class B shares (or 65% of the outstanding Class B
shares) and 87,617 Class C shares (or 93% of the outstanding Class C shares) of
the Fund. In the event of any meetings of shareholders, Prudential Securities
will forward, or cause the forwarding of, proxy materials to the beneficial
owners for which it is the record holder.

MANAGER

The manager of the Fund is Prudential Mutual Fund Management, Inc. (PMF or
the Manager), One Seaport Plaza, New York, New York 10292. PMF serves as manager
to substantially all of the other investment companies that, together with the
Fund, comprise the "Prudential Mutual Funds." See "How the Fund is Managed" in
the Prospectus. As of November 30, 1994, PMF managed and/or administered
open-end and closed-end management investment companies with assets of
approximately $47 billion and, according to the Investment Company Institute, as
of April 30, 1994 the Prudential Mutual Funds were the 12th largest family of
mutual funds in the United States.

Pursuant to the Management Agreement with the Fund (the Management
Agreement), PMF, subject to the supervision of the Fund's Board of Directors and
in conformity with the stated policies of the Fund, manages both the investment
operations of the Fund and the composition of the Fund's portfolio, including
the purchase, retention, disposition and loan of securities. In connection
therewith, PMF is obligated to keep certain books and records of the Fund. PMF
also administers the Fund's corporate affairs and, in connection therewith,
furnishes the Fund with office facilities, together with those ordinary clerical
and bookkeeping services which are not being furnished by State Street Bank and
Trust Company, the Fund's custodian, and Prudential Mutual Fund Services,
Inc.(PMFS or the Transfer Agent), the Fund's transfer and dividend disbursing
agent. The management services of PMF for the Fund are not exclusive under the
terms of the Management Agreement and PMF is free to, and does, render
management services to others.

For its services, PMF receives, pursuant to the Management Agreement, a fee
at an annual rate of .75 of 1% of the Fund's average daily net assets. The fee
is computed daily and payable monthly. The Management Agreement also provides
that, in the event the expenses of the Fund (including the fees of PMF, but
excluding interest, taxes, brokerage commissions, distribution fees and
litigation and indemnification expenses and other extraordinary expenses not
incurred in the ordinary course of the Fund's business) for any fiscal year
exceed the lowest applicable annual expense limitation established and enforced
pursuant to the statutes or regulations of any jurisdiction in which the Fund's
shares are qualified for offer and sale, the compensation due to PMF will be
reduced by the amount of such excess. Reductions in excess of the total
compensation payable to PMF will be paid by PMF to the Fund. No such reductions
were required during the fiscal year ended October 31, 1994. Currently, the Fund
believes that the most restrictive expense limitation of state securities
commissions is 2-1/2% of the Fund's average daily net assets up to $30 million,
2% of the next $70 million of such assets and 1-1/2% of such assets in excess of
$100 million. Because the expenses incurred by the Fund are anticipated to be
higher than those of funds that invest only in U.S. securities, the Fund has
received waivers from applicable state expense limitations to exclude certain
foreign transactional expenses from expenses subject to the limitation.

B-13

<PAGE>

In connection with its management of the corporate affairs of the Fund, PMF
bears the following expenses:

(a) the salaries and expenses of all of its and the Fund's personnel except
the fees and expenses of Directors who are not affiliated persons of PMF or the
Fund's investment adviser;

(b) all expenses incurred, by PMF or by the Fund in connection with
managing the ordinary course of the Fund's business, other than those assumed by
the Fund as described below; and

(c) the costs and expenses payable to The Prudential Investment Corporation
(PIC) pursuant to the subadvisory agreement between PMF and PIC (the Subadvisory
Agreement).

Under the terms of the Management Agreement, the Fund is responsible for
the payment of the following expenses: (a) the fees payable to the Manager, (b)
the fees and expenses of Directors who are not affiliated persons of the Manager
or the Fund's investment adviser, (c) the fees and certain expenses of the
Custodian and Transfer and Dividend Disbursing Agent, including the cost of
providing records to the Manager in connection with its obligation of
maintaining required records of the Fund and of pricing the Fund's shares, (d)
the charges and expenses of legal counsel and independent accountants for the
Fund, (e) brokerage commissions and any issue or transfer taxes chargeable to
the Fund in connection with its securities transactions, (f) all taxes and
corporate fees payable by the Fund to governmental agencies, (g) the fees of any
trade associations of which the Fund may be a member, (h) the cost of stock
certificates representing shares of the Fund, (i) the cost of fidelity and
liability insurance, (j) the fees and expenses involved in registering and
maintaining registration of the Fund and of its shares with the Securities and
Exchange Commission, registering the Fund and qualifying its shares under state
securities laws, including the preparation and printing of the Fund's
registration statements and prospectuses for such purposes, (k) allocable
communications expenses with respect to investor services and all expenses of
shareholders' and Directors' meetings and of preparing, printing and mailing
reports, proxy statements and prospectuses to shareholders in the amount
necessary for distribution to the shareholders, (l) litigation and
indemnification expenses and other extraordinary expenses not incurred in the
ordinary course of the Fund's business and (m) distribution fees.

The Management Agreement provides that PMF will not be liable for any error
of judgment or for any loss suffered by the Fund in connection with the matters
to which the Management Agreement relates, except a loss resulting from willful
misfeasance, bad faith, gross negligence or reckless disregard of duty. The
Management Agreement provides that it will terminate automatically if assigned,
and that it may be terminated without penalty by either party upon not more than
60 days' nor less than 30 days' written notice. The Management Agreement will
continue in effect for a period of more than two years from the date of
execution only so long as such continuance is specifically approved at least
annually in conformity with the Investment Company Act. The Management Agreement
was last approved by the Board of Directors of the Fund, including a majority of
the Directors who are not parties to the contract or interested persons of any
such party as defined in the Investment Company Act on June 6, 1994 and by
shareholders of the Fund on February 25, 1988. For the fiscal years ended
October 31, 1994, 1993 and 1992, PMF received management fees of $3,032,864,
$1,538,624 and $1,689,209, respectively.

PMF has entered into a Subadvisory Agreement (the Subadvisory Agreement)
with PIC (the Subadviser), a wholly-owned subsidiary of Prudential. The
Subadvisory Agreement provides that PIC will furnish investment advisory
services in connection with the management of the Fund. In connection therewith,
PIC is obligated to keep certain books and records of the Fund. PMF continues to
have responsibility for all investment advisory services pursuant to the
Management Agreement and supervises PIC's performance of such services. PIC is
reimbursed by PMF for the reasonable costs and expenses incurred by PIC in
furnishing those services.

The Subadvisory Agreement was last approved by the Board of Directors,
including a majority of the Directors who are not parties to the contract or
interested persons of any such party as defined in the Investment Company Act on
June 6, 1994, and by shareholders of the Fund on February 25, 1988.

The Subadvisory Agreement provides that it will terminate in the event of
its assignment (as defined in the Investment Company Act) or upon the
termination of the Management Agreement. The Subadvisory Agreement may be
terminated by the Fund, PMF or PIC upon not more than 60 days', nor less than 30
days', written notice. The Subadvisory Agreement provides that it will continue
in effect for a period of more than two years from its execution only so long as
such continuance is specifically approved at least annually in accordance with
the requirements of the Investment Company Act.

The Manager and the Subadviser (The Prudential Investment Corporation) are
subsidiaries of Prudential which, as of December 31, 1993, was the largest
insurance company in North America. Prudential has been engaged in the insurance
business since 1875. In July 1994, Institutional Investor ranked Prudential the
second largest institutional money manager of the 300 largest money management
organizations in the United States as of December 31, 1993.

B-14

<PAGE>

DISTRIBUTOR

Prudential Mutual Fund Distributors, Inc. (PMFD), One Seaport Plaza, New
York, New York 10292, acts as the distributor of the Class A shares of the Fund.
Prudential Securities Incorporated, One Seaport Plaza, New York, New York 10292
(Prudential Securities), acts as the distributor of the Class B and Class C
shares of the Fund.

Pursuant to separate Distribution and Service Plans (the Class A Plan, the
Class B Plan and the Class C Plan, collectively the Plans) adopted by the Fund
under Rule 12b-1 under the Investment Company Act and separate distribution
agreements (the Distribution Agreements), PMFD and Prudential Securities
(collectively the Distributor) incur the expenses of distributing the Fund's
Class A, Class B and Class C shares. See "How the Fund is Managed--Distributor"
in the Prospectus.

Prior to January 22, 1990, the Fund offered only one class of shares (the
existing Class B shares). On October 17, 1989, the Board of Directors, including
a majority of the Directors who are not interested persons of the Fund and who
have no direct or indirect financial interest in the operation of the Class A or
Class B Plan or in any agreement related to either Plan (the Rule 12b-1
Directors), at a meeting called for the purpose of voting on each Plan, adopted
a new plan of distribution for the Class A shares of the Fund (the Class A Plan)
and approved an amended and restated plan of distribution with respect to the
Class B shares of the Fund (the Class B Plan). On June 3, 1993, the Board of
Directors, including a majority of the Rule 12b-1 Directors, at a meeting called
for the purpose of voting on each Plan, approved the continuance of the Plans
and Distribution Agreements and approved modifications of the Fund's Class A and
Class B Plans and Distribution Agreements to conform them with recent amendments
to the National Association of Securities Dealers, Inc. (NASD) maximum sales
charge rule described below. As modified, the Class A Plan provides that (i) up
to .25 of 1% of the average daily net assets of the Class A shares may be used
to pay for personal service and the maintenance of shareholder accounts (service
fee) and (ii) total distribution fees (including the service fee of .25 of 1%)
may not exceed .30 of 1%. As modified, the Class B Plan provides that (i) up to
.25 of 1% of the average daily net assets of the Class B shares may be paid as a
service fee and .50 of 1% (not including the service fee) per annum of the
Fund's average daily net assets up to the level of average daily net assets as
of February 26, 1986, plus .75 of 1% (not including the service fee) per annum
of average daily net assets in excess of such level may be used as reimbursement
for distribution-related expenses with respect to the Class B shares
(asset-based sales charge). On June 3, 1993 the Board of Directors, including a
majority of the Rule 12b-1 Directors, at a meeting called for the purpose of
voting on each Plan, adopted a plan of distribution for the Class C shares of
the Fund and approved further amendments to the plans of distribution for the
Fund's Class A and Class B shares changing them from reimbursement type plans to
compensation type plans. The Plans were last approved by the Board of Directors,
including a majority of the Rule 12b-1 Directors, on June 6, 1994. The Class A
Plan, as amended, was approved by Class A and Class B shareholders, and the
Class B Plan, as amended, was approved by Class B shareholders on July 19, 1994.
The Class C Plan was approved by the sole shareholder of Class C shares on
August 1, 1994.

Class A Plan. For the fiscal year ended October 31, 1994, PMFD received
payments of $146,139 under the Class A Plan. This amount was primarily expended
for payment of account servicing fees to financial advisors and other persons
who sell Class A shares. For the fiscal year ended October 31, 1994, PMFD also
received approximately $575,300 in initial sales charges.

Class B Plan. For the fiscal year ended October 31, 1994, Prudential
Securities received $3,229,844 from the Fund under the Class B Plan and spent
approximately $4,534,404 in distributing the Fund's Class B shares. It is
estimated that of the latter amount approximately 2.1% ($96,150) was spent on
printing and mailing of prospectuses to other than current shareholders; 10.6%
($479,863) on compensation to Pruco Securities Corporation, an affiliated
broker-dealer, for commissions to its representatives and other expenses,
including an allocation of overhead and other branch office distribution-related
expenses, incurred by it for distribution of Fund shares; 8.4% ($382,419) in
interest and/or carrying charges and 78.9% ($3,575,972) on the aggregate of (i)
payments of commission and account servicing fees to financial advisers (36.5%
or $1,654,374) and (ii) an allocation of overhead and other branch office
distribution-related expenses (42.4% or $1,921,598). The term "overhead and
other branch office distribution-related expenses" represents (a) the expenses
of operating Prudential Securities' branch offices in connection with the sale
of Fund shares, including lease costs, the salaries and employee benefits of
operations and sales support personnel, utility costs, communications costs and
the costs of stationery and supplies, (b) the costs of client sales seminars,
(c) expenses of mutual fund sales coordinators to promote the sale of Fund
shares and (d) other incidental expenses relating to branch promotion of Fund
sales.

Prudential Securities also receives the proceeds of contingent deferred
sales charges paid by holders of Class B shares upon certain redemptions of
Class B shares. See "Shareholder Guide--How to Sell Your Shares--Contingent
Deferred Sales Charges" in the Prospectus. For the fiscal year ended October 31,
1994, Prudential Securities received approximately $508,700 in contingent
deferred sales charges.

B-15

<PAGE>

Class C Plan. For the period August 1, 1994 (inception of Class C shares)
through October 31, 1994, Prudential Securities received $1,554 under the Class
C Plan and spent approximately $10,993 in distributing Class C shares.
Prudential Securities receives the proceeds of contingent deferred sales charges
paid by investors upon certain redemptions of Class C shares. See "Shareholder
Guide--How to Sell Your Shares--Contingent Deferred Sales Charges" in the
Prospectus. For the period August 1, 1994 (inception of Class C shares) through
October 31, 1994, Prudential Securities received contingent deferred sales
charges of approximately $50.

The Class A, Class B and Class C Plans continue in effect from year to
year, provided that each such continuance is approved at least annually by a
vote of the Board of Directors, including a majority vote of the Rule 12b-1
Directors, cast in person at a meeting called for the purpose of voting on such
continuance. The Plans may each be terminated at any time, without penalty, by
the vote of a majority of the Rule 12b-1 Directors or by the vote of the holders
of a majority of the outstanding shares of the applicable class on not more than
30 days' written notice to any other party to the Plans. The Plans may not be
amended to increase materially the amounts to be spent for the services
described therein without approval by the shareholders of the applicable class
(by both Class A and Class B shareholders, voting separately, in the case of
material amendments to the Class A Plan), and all material amendments are
required to be approved by the Board of Directors in the manner described above.
Each Plan will automatically terminate in the event of its assignment. The Fund
will not be contractually obligated to pay expenses incurred under any Plan if
it is terminated or not continued.

Pursuant to each Plan, the Board of Directors will review at least
quarterly a written report of the distribution expenses incurred on behalf of
each class of shares of the Fund by the Distributor. The report includes an
itemization of the distribution expenses and the purposes of such expenditures.
In addition, as long as the Plans remain in effect, the selection and nomination
of Rule 12b-1 Directors shall be committed to the Rule 12b-1 Directors.

Pursuant to each Distribution Agreement, the Fund has agreed to indemnify
PMFD and Prudential Securities to the extent permitted by applicable law against
certain liabilities under the Securities Act of 1933, as amended. Each
Distribution Agreement was last approved by the Board of Directors, including a
majority of the Rule 12b-1 Directors, on June 6, 1994.

NASD Maximum Sales Charge Rule. Pursuant to rules of the NASD, the
Distributor is required to limit aggregate initial sales charges, deferred sales
charges and asset-based sales charges to 6.25% of total gross sales of each
class of shares. Interest charges on unreimbursed distribution expenses equal to
the prime rate plus one percent per annum may be added to the 6.25% limitation.
Sales from the reinvestment of dividends and distributions are not included in
the calculation of the 6.25% limitation. The annual asset-based sales charge on
shares of the Fund may not exceed .75 of 1% per class. The 6.25% limitation
applies to the Fund rather than on a per shareholder basis. If aggregate sales
charges were to exceed 6.25% of total gross sales of any class, all sales
charges on shares of that class would be suspended.

On October 21, 1993, PSI entered into an omnibus settlement with the SEC,
state securities regulators in 51 jurisdictions and the NASD to resolve
allegations that PSI sold interests in more than 700 limited partnerships (and a
limited number of other types of securities) from January 1, 1980 through
December 31, 1990, in violation of securities laws to persons for whom such
securities were not suitable in light of the individuals' financial condition or
investment objectives. It was also alleged that the safety, potential returns
and liquidity of the investments had been misrepresented. The limited
partnerships principally involved real estate, oil and gas producing properties
and aircraft leasing ventures. The SEC Order (i) included findings that PSI's
conduct violated the federal securities laws and that an order issued by the SEC
in 1986 requiring PSI to adopt, implement and maintain certain supervisory
procedures had not been complied with; (ii) directed PSI to cease and desist
from violating the federal securities laws and imposed a $10 million civil
penalty; and (iii) required PSI to adopt certain remedial measures including the
establishment of a Compliance Committee of its Board of Directors. Pursuant to
the terms of the SEC settlement, PSI established a settlement fund in the amount
of $330,000,000 and procedures, overseen by a court approved Claims
Administrator, to resolve legitimate claims for compensatory damages by
purchasers of the partnership interests. PSI has agreed to provide additional
funds, if necessary, for that purpose. PSI's settlement with the state
securities regulators included an agreement to pay a penalty of $500,000 per
jurisdiction. PSI consented to a censure and to the payment of a $5,000,000 fine
in settling the NASD action. In settling the above referenced matters, PSI
neither admitted nor denied the allegations asserted against it.

On January 18, 1994, PSI agreed to the entry of a Final Consent Order and a
Parallel Consent Order by the Texas Securities Commissioner. The firm also
entered into a related agreement with the Texas Securities Commissioner. The
allegations were that the firm had engaged in improper sales practices and other
improper conduct resulting in pecuniary losses and other harm to investors
residing in Texas with respect to purchases and sales of limited partnership
interests during the period of January 1, 1980 through December 31, 1990.
Without admitting or denying the allegations, PSI consented to a reprimand,
agreed to cease and desist from future violations, and to provide voluntary
donations to the State of Texas in the aggregate amount of $1,500,000. The firm
agreed to suspend the creation of new customer accounts, the general
solicitation of new accounts, and the offer for sale

B-16

<PAGE>

of securities in or from PSI's North Dallas office to new customers during a
period of twenty consecutive business days, and agreed that its other Texas
offices would be subject to the same restrictions for a period of five
consecutive business days. PSI also agreed to institute training programs for
its securities salesmen in Texas.

On October 27, 1994, Prudential Securities Group, Inc. and PSI entered into
agreements with the United States Attorney deferring prosecution (provided PSI
complies with the terms of the agreement for three years) for any alleged
criminal activity related to the sale of certain limited partnership programs
from 1983 to 1990. In connection with these agreements, PSI agreed to add the
sum of $330,000,000 to the Fund established by the SEC and executed a
stipulation providing for a reversion of such funds to the United States Postal
Inspection Service. PSI further agreed to obtain a mutually acceptable outside
director to sit on the Board of Directors of PSG and the Compliance Committee of
PSI. The new director will also serve as an independent "ombudsman" whom PSI
employees can call anonymously with complaints about ethics and compliance.
Prudential Securities shall report any allegations or instances of criminal
conduct and material improprieties to the new director. The new director will
submit compliance reports which shall identify all such allegations or instances
of criminal conduct and material improprieties every three months for a
three-year period.

NET ASSET VALUE

Under the Investment Company Act, the Board of Directors is responsible for
determining in good faith the fair value of securities of the Fund. In
accordance with procedures adopted by the Board of Directors, the value of
investments listed on a securities exchange and NASDAQ National Market System
securities (other than options on stock and stock indices) are valued at the
last sales price on the day of valuation, or, if there was no sale on such day,
the mean between the last bid and asked prices on such day, as provided by a
pricing service. Corporate bonds (other than convertible debt securities) and
U.S. Government securities that are actively traded in the over-the-counter
market, including listed securities for which the primary market is believed to
be over-the-counter, are valued on the basis of valuations provided by a pricing
service which uses information with respect to transactions in bonds, quotations
from bond dealers, agency ratings, market transactions in comparable securities
and various relationships between securities in determining value. Convertible
debt securities that are actively traded in the over-the-counter market,
including listed securities for which the primary value is believed to be
over-the-counter, are valued at the mean between the last reported bid and asked
prices provided by principal market makers or independent pricing agents. Other
securities will be valued at the mean of the most recently quoted bid and asked
prices in the over-the-counter market. Options on stock and stock indices traded
on an exchange are valued at the mean between the most recently quoted bid and
asked prices on the respective exchange and futures contracts and options
thereon are valued at their last sales prices as of the close of the commodities
exchange or board of trade. Should an extraordinary event, which is likely to
affect the value of the security, occur after the close of an exchange on which
a portfolio security is traded, such security will be valued at fair value
considering factors determined in good faith by the investment adviser under
procedures established by and under the general supervision of the Fund's Board
of Directors.

Securities or other assets for which market quotations are not readily
available are valued at their fair value as determined in good faith by the
Board of Directors. Short-term debt securities are valued at cost, with interest
accrued or discount amortized to the date of maturity, if their original
maturity was 60 days or less, unless this is determined by the Board of
Directors not to represent fair value. Short-term securities with remaining
maturities of 60 days or more, for which market quotations are readily
available, are valued at their current market quotations as supplied by an
independent pricing agent or principal market maker. The Fund will compute its
net asset value at 4:15 P.M., New York time, on each day the New York Stock
Exchange is open for trading except on days on which no orders to purchase, sell
or redeem Fund shares have been received or days on which changes in the value
of the Fund's portfolio securities do not affect net asset value. In the event
the New York Stock Exchange closes early on any business day, the net asset
value of the Fund's shares shall be determined at a time between such closing
and 4:15 p.m., New York time.

Net asset value is calculated separately for each class. The net asset
value of Class B and Class C shares will generally be lower than the net asset
value of Class A shares as a result of the larger distribution-related fee to
which Class B and Class C shares are subject. It is expected, however, that the
net asset value per share of each class will tend to converge immediately after
the recording of dividends which will differ by approximately the amount of the
distribution expense accrual differential among the classes.

PORTFOLIO TRANSACTIONS AND BROKERAGE

The Manager is responsible for decisions to buy and sell securities,
options and futures contracts for the Fund, the selection of brokers, dealers
and futures commission merchants to effect the transactions and the negotiation
of brokerage commissions, if any. Purchases and sales of securities, options or
futures on a national securities exchange or board of trade are effected

B-17

<PAGE>

through brokers or futures commission merchants who charge a
negotiated commission for their services; on foreign securities exchanges,
commissions may be fixed. Orders may be directed to any broker or futures
commission merchant including, to the extent and in the manner permitted by
applicable law, Prudential Securities and its affiliates. The term "Manager" as
used in this section includes the Subadviser.

In the over-the-counter market, securities are generally traded on a "net"
basis with dealers acting as principal for their own accounts without a stated
commission, although the price of the security usually includes a profit to the
dealer. In underwritten offerings, securities are purchased at a fixed price
which includes an amount of compensation to the underwriter, generally referred
to as the underwriter's concession or discount. On occasion, certain money
market instruments may be purchased directly from an issuer, in which case no
commissions or discounts are paid. The Fund will not deal with Prudential
Securities or any affiliate in any transaction in which Prudential Securities or
any affiliate acts as principal. Thus, it will not deal in over-the-counter
securities with Prudential Securities acting as market maker, and it will not
execute a negotiated trade with Prudential Securities if execution involves
Prudential Securities' acting as principal with respect to any part of the
Fund's order.

Portfolio securities may not be purchased from any underwriting or selling
syndicate of which Prudential Securities (or any affiliate), during the
existence of the syndicate, is a principal underwriter (as defined in the
Investment Company Act), except in accordance with rules of the SEC. This
limitation, in the opinion of the Fund, will not significantly affect the Fund's
ability to pursue its present investment objective. However, in the future, in
other circumstances, the Fund may be at a disadvantage because of this
limitation in comparison to other funds with similar objectives but not subject
to such limitations.

In placing orders for portfolio securities of the Fund, the Manager is
required to give primary consideration to obtaining the most favorable price and
efficient execution. This means that the Manager will seek to execute each
transaction at a price and commission, if any, which provide the most favorable
total cost or proceeds reasonably attainable in the circumstances. While the
Manager generally seeks reasonably competitive spreads or commissions, the Fund
will not necessarily be paying the lowest spread or commission available. Within
the framework of this policy, the Manager will consider research and investment
services provided by brokers, dealers or futures commission merchants who effect
or are parties to portfolio transactions of the Fund, the Manager or its
clients. Such research and investment services are those which brokerage houses
customarily provide to institutional investors and include statistical and
economic data and research reports on particular companies and industries. Such
services are used by the Manager in connection with all of its investment
activities, and some of such services obtained in connection with the execution
of transactions for the Fund may be used in managing other investment accounts.
Conversely, brokers, dealers or futures commission merchants furnishing such
services may be selected for the execution of transactions of such other
accounts, whose aggregate assets are far larger than those of the Fund, and the
services furnished by such brokers, dealers or futures commission merchants may
be used by the Manager in providing investment management for the Fund.
Commission rates are established pursuant to negotiations with the broker,
dealer or futures commission merchant based on the quality and quantity of
execution services provided by the broker, dealer or futures commission merchant
in the light of generally prevailing rates. The Manager is authorized to pay
higher commissions on brokerage transactions for the Fund to brokers, dealers or
futures commission merchants other than Prudential Securities in order to secure
research and investment services described above, subject to review by the
Fund's Board of Directors from time to time as to the extent and continuation of
this practice. The allocation of orders among brokers, dealers and futures
commission merchants and the commission rates paid are reviewed periodically by
the Fund's Board of Directors.

Subject to the above considerations, Prudential Securities may act as a
broker or futures commission merchant for the Fund. In order for Prudential
Securities (or any affiliate) to effect any portfolio transactions for the Fund,
the commissions, fees or other remuneration received by Prudential Securities
(or any affiliate) must be reasonable and fair compared to the commissions, fees
or other remuneration paid to other brokers or futures commission merchants in
connection with comparable transactions involving similar securities or futures
being purchased or sold on a securities exchange or board of trade during a
comparable period of time. This standard would allow Prudential Securities (or
any affiliate) to receive no more than the remuneration which would be expected
to be received by an unaffiliated broker in a commensurate arm's-length
transaction. Furthermore, the Board of Directors of the Fund, including a
majority of the noninterested directors, has adopted procedures which are
reasonably designed to provide that any commissions, fees or other remuneration
paid to Prudential Securities (or any affiliate) are consistent with the
foregoing standard. In accordance with Section 11(a) under the Securities
Exchange Act of 1934, Prudential Securities may not retain compensation for
effecting transactions on a national securities exchange for the Fund unless the
Fund has expressly authorized the retention of such compensation. Prudential
Securities must furnish to the Fund at least annually a statement setting forth
the total amount of all compensation retained by Prudential Securities from
transactions effected for the Fund during the applicable period. Brokerage
transactions with Prudential Securities (or any affiliate) are also subject to
such fiduciary standards as may be imposed upon Prudential Securities (or such
affiliate) by applicable law.

B-18

<PAGE>

The table presented below shows certain information regarding the payment
of commissions by the Fund, including the amount of such commissions paid to
Prudential Securities, for the three year period ended October 31, 1994.

Fiscal Years ended October 31,
-----------------------------------------
1994 1993 1992
---------- -------- ----------
<S> <C> <C> <C>

Total brokerage commissions paid by the Fund .................................. $1,646,300 $952,800 $1,048,900
Total brokerage commissions paid to Prudential Securities ..................... $ 2,200 $ 0 $ 11,600
Percentage of total brokerage commissions paid to Prudential Securities ....... 0.1% 0% 1.1%

</TABLE>

Of the total brokerage commissions, $ 1,644,520 or 99.6% were paid to firms
which provided research, statistical or other services to PMF during the fiscal
year ended October 31, 1994. PMF has not separately identified a portion of such
brokerage commissions as allocable to the provision of such research,
statistical or other services.

PURCHASE AND REDEMPTION OF FUND SHARES

Each class of shares represents an interest in the same portfolio of
investments of the Fund and has the same rights, except that (i) each class
bears the separate expenses of its Rule 12b-1 distribution and service plan
(ii) each class has exclusive voting rights with respect to its plan (except
that the Fund has agreed with the SEC in connection with the offering of a
conversion feature on Class B shares to submit any amendment of the Class A
distribution and service plan to both Class A and Class B shareholders) and
(iii) only Class B shares have a conversion feature. See "Distributor." Each
class also has separate exchange privileges. See "Shareholder Investment
Account--Exchange Privilege."

Specimen Price Make-up

Under the current distribution arrangements between the Fund and the
Distributor, Class A shares are sold at a maximum sales charge of 5% and Class
B* and Class C* shares are sold at net asset value. Using the Fund's net asset
value at October 31, 1994, the maximum offering price of the Fund's shares is as
follows:

<TABLE>

<S> <C>

Class A
Net asset value and redemption price per Class A share ..................... $14.89
Maximum sales charge (5% of offering price) ................................ .78
------
Offering price to public ................................................... $15.67
======

Class B
Net asset value, offering price and redemption price per Class B share* .... $14.53
======
Class C
Net asset value, offering price and redemption price per Class C share* .... $14.53
======
<FN>
-------------

*Class B and Class C shares are subject to a contingent deferred sales
charge on certain redemptions. See "Shareholder Guide--How to Sell Your
Shares--Contingent Deferred Sales Charges" in the Prospectus.

</FN>
</TABLE>

Reduction and Waiver of Initial Sales Charges--Class A Shares

Combined Purchase and Cumulative Purchase Privilege. If an investor or
eligible group of related investors purchases Class A shares of the Fund
concurrently with Class A shares of other Prudential Mutual Funds, the purchases
may be combined to take advantage of the reduced sales charges applicable to
larger purchases. See the table of break points under "Shareholder
Guide--Alternative Purchase Plan" in the Prospectus.

An eligible group of related Fund investors includes any combination of the
following:

(a) an individual;

(b) the individual's spouse, their children and their parents;

B-19

<PAGE>

(d) any company controlled by the individual (a person, entity or
group that holds 25% or more of the outstanding voting securities
of a company will be deemed to control the company, and a
partnership will be deemed to be controlled by each of its
general partners);

(e) a trust created by the individual, the beneficiaries of which are
the individual, his or her spouse, parents or children;

(f) a Uniform Gifts to Minors Act/Uniform Transfers to Minors Act
account created by the individual or the individual's spouse; and

(g) one or more employee benefit plans of a company controlled by an
individual.

In addition, an eligible group of related Fund investors may include the
following: an employer (or group of related employers) and one or more qualified
retirement plans of such employer or employers (an employer controlling,
controlled by or under common control with another employer is deemed related to
that employer).

The Distributor must be notified at the time of purchase that the investor
is entitled to a reduced sales charge. The reduced sales charge will be granted
subject to confirmation of the investor's holdings. The Combined Purchase and
Cumulative Purchase Privilege does not apply to individual participants in any
retirement or group plans.

Rights of Accumulation. Reduced sales charges are also available through
Rights of Accumulation, under which an investor or an eligible group of related
investors, as described above under "Combined Purchase and Cumulative Purchase
Privilege," may aggregate the value of their existing holdings of the shares of
the Fund and shares of other Prudential Mutual Funds (excluding money market
funds other than those acquired pursuant to the exchange privilege) to determine
the reduced sales charge. However, the value of shares held directly with the
Transfer Agent and through Prudential Securities will not be aggregated to
determine the reduced sales charge. All shares must be held either directly with
the Transfer Agent or through Prudential Securities. The value of existing
holdings for purposes of determining the reduced sales charge is calculated
using the maximum offering or price (net asset value plus maximum sales charge)
as of the previous business day. See "How the Fund Values Its Shares" in the
Prospectus. The Distributor must be notified at the time of purchase that the
investor is entitled to a reduced sales charge. The reduced sales charges will
be granted subject to confirmation of the investor's holdings. Rights of
accumulation are not available to individual participants in any retirement or
group plans.

Letters of Intent. Reduced sales charges are available to investors (or an
eligible group of related investors), including retirement and group plans, who
enter into a written Letter of Intent providing for the purchase, within a
thirteen-month period, of shares of the Fund and shares of other Prudential
Mutual Funds. All shares of the Fund and shares of other Prudential Mutual Funds
(excluding money market funds other than acquired pursuant to the exchange
privilege) which were previously purchased and are still owned are also included
in determining the applicable reduction. However, the value of shares held
directly with the Transfer Agent and through Prudential Securities will not be
aggregated to determine the reduced sales charge. All shares must be held either
directly with the Transfer Agent or through Prudential Securities. Letters of
Intent are not available to individual participants in any retirement or group
plans.

A Letter of Intent permits a purchaser to establish a total investment goal
to be achieved by any number of investments over a thirteen-month period. Each
investment made during the period will receive the reduced sales charge
applicable to the amount represented by the goal, as if it were a single
investment. Escrowed Class A shares totaling 5% of the dollar amount of the
Letter of Intent will be held by the Transfer Agent in the name of the
purchaser, except in the case of retirement and group plans where the employer
or plan sponsor will be responsible for paying any applicable sales charge. The
effective date of a Letter of Intent may be back-dated up to 90 days, in order
that any investments made during this 90-day period, valued at the purchaser's
cost, can be applied to the fulfillment of the Letter of Intent goal, except in
the case of retirement and group plans.

The Letter of Intent does not obligate the investor to purchase, nor the
Fund to sell, the indicated amount. In the event the Letter of Intent goal is
not achieved within the thirteen-month period, the purchaser (or the employer or
plan sponsor in the case of any retirement or group plan) is required to pay the
difference between the sales charge otherwise applicable to the purchases made
during this period and sales charges actually paid. Such payment may be made
directly to the Distributor or, if not paid, the Distributor will liquidate
sufficient escrowed shares to obtain such difference. Investors electing to
purchase Class A shares of the Fund pursuant to a Letter of Intent should
carefully read such Letter of Intent.

B-20

<PAGE>

Waiver of the Contingent Deferred Sales Charge--Class B Shares

The Contingent Deferred Sales Charge is waived under circumstances
described in the Prospectus. See "Shareholder Guide--How to Sell Your
Shares--Waiver of Contingent Deferred Sales Charges--Class B Shares" in the
Prospectus. In connection with these waivers, the Transfer Agent will require
you to submit the supporting documentation set forth below.

<TABLE>
<CAPTION>
Category of Waiver Required Documentation
<S> <C>
Death A copy of the shareholder's death certificate or, in
the case of a trust, a copy of the grantor's death certificate,
plus a copy of the trust agreement identifying the grantor.

Disability--An individual will be considered A copy of the Social Security Administration award
disabled if he or she is unable to engage in any letter or a letter from a physician on the physician's
substantial gainful activity by reason of any letterhead stating that the shareholder (or, in the
medically determinable physical or mental case of a trust, the grantor) is permanently
impairment which can be expected to result in disabled. The letter must also indicate the date of
death or to be of long-continued and indefinite disability.
duration.

Distribution from an IRA or 403(b) Custodial A copy of the distribution form from the custodial
Account firm indicating (i) the date of birth of the
shareholder and (ii) that the shareholder is over age 59 1/2
and is taking a normal distribution--signed by the shareholder.

Distribution from Retirement Plan A letter signed by the plan administrator/trustee indicating the
reason for the distribution.

Excess Contributions A letter from the shareholder (for an IRA) or the
plan administrator/trustee on company letterhead indicating the
amount of the excess and whether or not taxes have been paid.

</TABLE>

The Transfer Agent reserves the right to request such additional documents
as it may deem appropriate.

Quantity Discount--Class B Shares Purchased Prior to August 1, 1994

The CDSC is reduced on redemptions of Class B shares of the Fund purchased
prior to August 1, 1994 if immediately after a purchase of such shares, the
aggregate cost of all Class B shares of the Fund owned by you in a single
account exceeded $500,000. For example, if you purchased $100,000 of Class B
shares of the Fund and the following year purchased an additional $450,000 of
Class B shares with the result that the aggregate cost of your Class B shares of
the Fund following the second purchase was $550,000, the quantity discount would
be available for the second purchase of $450,000 but not for the first purchase
of $100,000. The quantity discount will be imposed at the following rates
depending on whether the aggregate value exceeded $500,000 or $1 million:

Contingent Deferred Sales Charge
as a Percentage of Dollars Invested
or Redemption Proceeds
Year Since Purchase -------------------------------------------
Payment Made $500,001 to $1 million Over $1 million
- ------------------- ---------------------- ---------------
First ............................. 3.0% 2.0%
Second ............................ 2.0% 1.0%
Third ............................. 1.0% 0%
Fourth and thereafter ............. 0% 0%

SHAREHOLDER INVESTMENT ACCOUNT

Upon the initial purchase of Fund shares, a Shareholder Investment Account
is established for each investor under which a record of the shares held is
maintained by the Transfer Agent. If a stock certificate is desired, it must be
requested in writing for each transaction. Certificates are issued only for full
shares and may be redeposited in the Account at any time. There is no charge to
the investor for issuance of a certificate. The Fund makes available to the
shareholders the following privileges and plans.

Automatic Reinvestment of Dividends and/or Distributions

For the convenience of investors, all dividends and distributions are
automatically reinvested in full and fractional shares of the Fund at the net
asset value per share at the close of business on the record date. An investor
may direct the Transfer Agent in

B-21

<PAGE>

writing not less than five full business days prior to the record date to have
subsequent dividends and/or distributions sent in cash rather than reinvested.
In the case of recently purchased shares for which registration instructions
have not been received on the record date, cash payment will be made directly to
the dealer. Any shareholder who receives a cash payment representing a dividend
or distribution may reinvest such distribution at net asset value by returning
the check or the proceeds to the Transfer Agent within 30 days after the payment
date. Such investment will be made at the net asset value per share next
determined after receipt of the check or proceeds by the Transfer Agent. Such
shareholder will receive credit for any contingent deferred sales charge paid in
connection with the amount of proceeds being reinvested.

Exchange Privilege

The Fund makes available to its shareholders the privilege of exchanging
their shares of the Fund for shares of certain other Prudential Mutual Funds,
including one or more specified money market funds, subject in each case to the
minimum investment requirements of such funds. Shares of such other Prudential
Mutual Funds may also be exchanged for shares of the Fund. All exchanges are
made on the basis of relative net asset value next determined after receipt of
an order in proper form. An exchange will be treated as a redemption and
purchase for tax purposes. Shares may be exchanged for shares of another fund
only if shares of such fund may legally be sold under applicable state laws. For
retirement and group plans having a limited menu of Prudential Mutual Funds, the
Exchange Privilege is available for those funds eligible for investment in the
particular program.

It is contemplated that the exchange privilege may be applicable to new
mutual funds whose shares may be distributed by the Distributor.

Class A. Shareholders of the Fund may exchange their Class A shares for Class A
shares of certain other Prudential Mutual Funds, shares of Prudential Structured
Maturity Fund and Prudential Government Securities Trust (Intermediate Term
Series) and shares of the money market funds specified below. No fee or sales
load will be imposed upon the exchange. Shareholders of money market funds who
acquired such shares upon exchange of Class A shares may use the Exchange
Privilege only to acquire Class A shares of the Prudential Mutual Funds
participating in the Exchange Privilege.

The following money market funds participate in the Class A Exchange
Privilege:

Prudential California Municipal Fund
(California Money Market Series)
Prudential Government Securities Trust
(Money Market Series)
(U.S. Treasury Money Market Series)
Prudential Municipal Series Fund
(Connecticut Money Market Series)
(Massachusetts Money Market Series)
(New Jersey Money Market Series)
(New York Money Market Series)
Prudential Money Mart Assets
Prudential Tax-Free Money Fund

Class B and Class C. Shareholders of the Fund may exchange their Class B and
Class C shares for Class B and Class C shares, respectively, of certain other
Prudential Mutual Funds and shares of Prudential Special Money Market Fund, a
money market fund. No CDSC will be payable upon such exchange, but a CDSC may be
payable upon the redemption of Class B and Class C shares acquired as a result
of the exchange. The applicable sales charge will be that imposed by the fund in
which shares were initially purchased and the purchase date will be deemed to be
the date of the initial purchase, rather than the date of the exchange.

Class B and Class C shares of the Fund may also be exchanged for shares of
an eligible money market fund without imposition of any CDSC at the time of
exchange. Upon subsequent redemption from such money market fund or after
re-exchange into the Fund, such shares may be subject to the CDSC calculated
without regard to the time such shares were held in the money market fund. In
order to minimize the period of time in which shares are subject to a CDSC,
shares exchanged out of the money market fund will be exchanged on the basis of
their remaining holding periods, with the longest remaining holding periods
being transferred first. In measuring the time period shares are held in a money
market fund and "tolled" for purposes of calculating the CDSC holding period,
exchanges are deemed to have been made on the last day of the month. Thus, if
shares are exchanged into the Fund from a money market fund during the month
(and are held in the Fund at the end of the month), the entire month will be
included in the CDSC holding period. Conversely, if shares are exchanged into a
money market fund prior to the last day of the month (and are held in the money
market fund on the last day of the month), the entire month will be excluded
from the CDSC holding period. For purposes of calculating the seven year holding
period applicable to the Class B conversion feature, the time period during
which Class B shares were held in a money market fund will be excluded.

B-22

<PAGE>

At any time after acquiring shares of other funds participating in the
Class B and Class C exchange privilege, a shareholder may again exchange those
shares (and any reinvested dividends and distributions) for Class B and Class C
shares of the Fund, respectively, without subjecting such shares to any CDSC.
Shares of any fund participating in the Class B or Class C exchange privilege
that were acquired through reinvestment of dividends or distributions may be
exchanged for Class B or Class C shares of other funds, respectively, without
being subject to any CDSC.

Additional details about the Exchange Privilege and prospectuses for each
of the Prudential Mutual Funds are available from the Fund's Transfer Agent,
Prudential Securities or Prusec. The Exchange Privilege may be modified,
terminated or suspended on sixty days' notice, and any fund, including the Fund,
or the Distributor, has the right to reject any exchange application relating to
such fund's shares.

Dollar Cost Averaging

Dollar cost averaging is a method of accumulating shares by investing a
fixed amount of dollars in shares at set intervals. An investor buys more shares
when the price is low and fewer shares when the price is high. The average cost
per share is lower than it would be if a constant number of shares were bought
at set intervals.

Dollar cost averaging may be used, for example, to plan for retirement, to
save for a major expenditure, such as the purchase of a home, or to finance a
college education. The cost of a year's education at a four-year college today
averages around $14,000 at a private college and around $4,800 at a public
university. Assuming these costs increase at a rate of 7% a year, as has been
projected, for the freshman class of 2007, the cost of four years at a private
college could reach $163,000 and over $97,000 at a public university.1

The following chart shows how much you would need in monthly investments to
achieve specified lump sums to finance your investment goals.2

Period of
Monthly investments: $100,000 $150,000 $200,000 $250,000
-------------------- -------- -------- -------- --------
<S> <C> <C> <C> <C>
25 Years ............................. $ 110 $ 165 $ 220 $ 275
20 Years ............................. 176 264 352 440
15 Years ............................. 296 444 592 740
10 Years ............................. 555 833 1,110 1,388
5 Years .............................. 1,371 2,057 2,742 3,428

See "Automatic Savings Accumulation Plan."
- -----------
<FN>
1 Source information concerning the costs of education at public
universities is available from The College Board Annual Survey of Colleges,
1992. Information about the costs of private colleges is from the Digest of
Education Statistics, 1992; The National Center for Educational Statistics; and
the U.S. Department of Education. Average costs for private institutions include
tuition, fees, room and board.

2 The chart assumes an effective rate of return of 8% (assuming monthly
compounding). This example is for illustrative purposes only and is not intended
to reflect the performance of an investment in shares of the Fund. The
investment return and principal value of an investment will fluctuate so that an
investor's shares when redeemed may be worth more or less than their original
cost.
</FN>
</TABLE>

Automatic Savings Accumulation Plan (ASAP)

Under ASAP, an investor may arrange to have a fixed amount automatically
invested in shares of the Fund monthly by authorizing his or her bank account or
Prudential Securities Account (including a Command Account) to be debited to
invest specified dollar amounts in shares of the Fund. The investor's bank must
be a member of the Automatic Clearing House System. Stock certificates are not
issued to ASAP participants.

Further information about this program and an application form can be
obtained from the Transfer Agent, Prudential Securities or Prusec.

Systematic Withdrawal Plan

A systematic withdrawal plan is available to shareholders through
Prudential Securities or the Transfer Agent. Such withdrawal plan provides for
monthly or quarterly checks in any amount, except as provided below, up to the
value of the shares in the shareholder's account. Withdrawals of Class B or
Class C shares may be subject to a CDSC. See "Shareholder Guide--How to Sell
Your Shares--Contingent Deferred Sales Charges" in the Prospectus.

B-23

<PAGE>

In the case of shares held through the Transfer Agent (i) a $10,000 minimum
account value applies, (ii) withdrawals may not be for less than $100 and (iii)
the shareholder must elect to have all dividends and/or distributions
automatically reinvested in additional full and fractional shares at net asset
value on shares held under this plan. See "Shareholder Investment
Account--Automatic Reinvestment of Dividends and/or Distributions."

Prudential Securities and the Transfer Agent act as agents for the
shareholder in redeeming sufficient full and fractional shares to provide the
amount of the periodic withdrawal payment. The systematic withdrawal plan may be
terminated at any time, and the Distributor reserves the right to initiate a fee
of up to $5 per withdrawal, upon 30 days' written notice to the shareholder.

Withdrawal payments should not be considered as dividends, yield or income.
If periodic withdrawals continuously exceed reinvested dividends and
distributions, the shareholder's original investment will be correspondingly
reduced and ultimately exhausted.

Furthermore, each withdrawal constitutes a redemption of shares, and any
gain or loss realized must be recognized for federal income tax purposes. In
addition, withdrawals made concurrently with purchases of additional shares are
inadvisable because of the sales charge applicable to (i) the purchase of Class
A shares and (ii) the withdrawal of Class B and Class C shares. Each shareholder
should consult his or her own tax adviser with regard to the tax consequences of
the systematic withdrawal plan, particularly if used in connection with a
retirement plan.

Tax-Deferred Retirement Plans

Various qualified retirement plans, including a 401(k) Plan, self-directed
individual retirement accounts and "tax sheltered accounts" under Section
403(b)(7) of the Internal Revenue Code are available through the Distributor.
These plans are for use by both self-employed individuals and corporate
employers. These plans permit either self-direction of accounts by participants
or a pooled account arrangement. Information regarding the establishment of
these plans, the administration, custodial fees and other details are available
from Prudential Securities or the Transfer Agent.

Investors who are considering the adoption of such a plan should consult
with their own legal counsel or tax adviser with respect to the establishment
and maintenance of any such plan.

Tax-Deferred Retirement Accounts

Individual Retirement Accounts. An individual retirement account (IRA)
permits the deferral of federal income tax on income earned in the account until
the earnings are withdrawn. The following chart represents a comparison of the
earnings in a personal savings account with those in an IRA, assuming a $2,000
annual contribution, an 8% rate of return and a 39.6% federal income tax bracket
and shows how much more retirement income can accumulate within an IRA as
opposed to a taxable individual savings account.

Tax-Deferred Compounding1

Contributions Personal
Made Over: Savings IRA
------------- --------- --------
10 years $ 26,165 $ 31,291
15 years 44,676 58,649
20 years 68,109 98,846
25 years 97,780 157,909
30 years 135,346 244,692

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

1 The chart is for illustrative purposes only and does not represent the
performance of the Fund or any specific investment. It shows taxable versus
tax-deferred compounding for the periods and on the terms indicated. Earnings in
the IRA account will be subject to tax when withdrawn from the account.

B-24

<PAGE>

PERFORMANCE INFORMATION

Average Annual Total Return. The Fund may from time to time advertise its
average annual total return. Average annual total return is determined
separately for Class A, Class B and Class C shares. See "How the Fund Calculates
Performance" in the Prospectus.

Average annual total return is computed according to the following formula:

n
P(1+T) = ERV

Where: P = a hypothetical initial payment of $1000.
T = average annual total return.
n = number of years.

ERV = ending redeemable value at the end of the 1, 5 or 10 year
periods (or fractional portion thereof) of a hypothetical
$1,000 payment made at the beginning of the 1, 5 or 10
year periods.

Average annual total return takes into account any applicable initial or
contingent deferred sales charge but does not take into account any federal or
state income taxes that may be payable upon redemption.

The average annual total return for Class A shares for the one year and
since inception periods ended October 31, 1994 were 13.06% and 8.35%,
respectively, with and without the subsidy of expenses. The average annual total
return with respect to the Class B shares of the Fund for the one, five and ten
year periods ended on October 31, 1994 and from inception of the Fund on May 16,
1984 through October 31, 1994 was 12.29%, 7.58%, 14.24% and 14.06%,
respectively. The average annual total return with respect to the Class B shares
of the Fund for the one, five and ten year periods ended on October 31, 1994 and
from inception of the Fund through October 31, 1994, would have been 12.29%,
7.58%, 14.23% and 14.06%, respectively, without the subsidy of expenses. See
"Manager." The average annual total return for Class C shares for the
since-inception period ended October 31, 1994 was 15.1%.

Yield. The Fund may from time to time advertise its yield as calculated
over a 30-day period. Yield is calculated separately for Class A, Class B and
Class C shares. This yield will be computed by dividing the Fund's net
investment income per share earned during this 30-day period by the maximum
offering price per share on the last day of this period. Yield is calculated
according to the following formula:

[ ]
[( a-b ) 6 ]
YIELD = 2[(---------- +1) -1 ]
[( cd ) ]
[ ]

Where: a = dividends and interest earned during the period.
b = expenses accrued for the period (net of reimbursements).
c = the average daily number of shares outstanding during the period
that were entitled to receive dividends.
d = the maximum offering price per share on the last day of the
period.

Yield fluctuates and an annualized yield quotation is not a representation
by the Fund as to what an investment in the Fund will actually yield for any
given period. Yields for the Fund will vary based on a number of factors
including changes in net asset value, market conditions, the level of interest
rates and the level of Fund income and expenses.

Aggregate Total Return. The Fund may also advertise its aggregate total
return. Aggregate total return is determined separately for Class A, Class B and
Class C shares. See "How the Fund Calculates Performance" in the Prospectus.

Aggregate total return represents the cumulative change in the value of an
investment in the Fund and is computed according to the following formula:

ERV - P
-------
P

Where: P = a hypothetical initial payment of $1000.
ERV = ending redeemable value at the end of the 1, 5 or 10 year periods
(or fractional portion thereof) of a hypothetical $1000 payment
made at the beginning of the 1, 5 or 10 year periods.

B-25

<PAGE>

Aggregate total return does not take into account any federal or state
income taxes that may be payable upon redemption or any applicable initial or
contingent deferred sales charges.

The aggregate total return with respect to the Class A shares of the Fund
for the one year ended October 31, 1994 and for the period January 22, 1990
through October 31, 1994 was 13.06% and 46.63%, respectively, with and without
the subsidy of expenses. The aggregate total return with respect to the Class B
shares of the Fund for the one, five and ten year periods ended on October 31,
1994 and from inception of the Fund on May 16, 1984 through October 31, 1994 was
12.29%, 14.11%, 278.39% and 295.80%, respectively. The aggregate total return
with respect to the Class B shares of the Fund for the one, five and ten year
periods ended on October 31, 1994 and from inception of the Fund through October
31, 1994, would have been 12.29%, 14.11%, 278.13% and 294.71%, respectively,
without the subsidy of expenses. See "Manager." The aggregate total return for
Class C shares for the since-inception period ended October 31, 1994 was 3.56%.

Performance Chart. From time to time, the performance of the Fund may be
measured against various indices. Set forth below is a chart which compares the
performance of different types of investment over the long-term and the rate of
inflation.1

[chart]

1 Source: Ibbotson Associates, "Stocks, Bonds, Bills and Inflation--1993
Yearbook" (annually updates the work of Roger G. Ibbotson and Rex A.
Sinquefield). Common stock returns are based on the Standard & Poor's 500 Stock
Index, a market-weighted, unmanaged index of 500 common stocks in a variety of
industry sectors. It is a commonly used indicator of broad stock price
movements. This chart is for illustrative purposes only, and is not intended to
represent the performance of any particular investment or fund.

B-26

<PAGE>

TAXES

The Fund has elected to qualify and intends to remain qualified as a
regulated investment company under the Internal Revenue Code for each taxable
year. Accordingly, the Fund must, among other things, (a) derive at least 90% of
its gross income from dividends, interest, proceeds from loans of securities and
gains from the sale or other disposition of securities or foreign currencies, or
other income (including, but not limited to, gains from options, futures or
forward contracts) derived with respect to its business of investing in such
securities or currencies; (b) derive less than 30% of its gross income from the
sale or other disposition of securities or certain options, futures and forward
contracts held less than three months; and (c) diversify its holdings so that,
at the end of each fiscal quarter, (i) at least 50% of the market value of the
Fund's assets is represented by cash, U.S. Government securities, securities of
other regulated investment companies and other securities, with such other
securities limited in respect of any one issuer to an amount not greater than 5%
of the Fund's assets, and not greater than 10% of the outstanding voting
securities of such issuer, and (ii) not more than 25% of the value of its assets
is invested in the securities of any one issuer (other than U.S. Government
securities or the securities of other regulated investment companies). These
requirements may limit the Fund's ability to invest in other types of assets.

As a regulated investment company, the Fund will not be subject to federal
income tax on its net investment income and capital gains, if any, that it
distributes to its shareholders, provided (among other things) that at least 90%
of the Fund's net investment income including net short-term capital gains
earned in the taxable year is distributed. The Fund intends to distribute
annually to its shareholders all of its taxable net investment income, which
includes dividends, interest and any net short-term capital gains in excess of
net long-term capital losses. The Board of Directors of the Fund will determine
once a year whether to distribute any net long-term capital gains in excess of
any net short-term capital losses. In determining the amount of capital gains to
be distributed, any capital loss carryovers from prior years will be offset
against capital gains. A 4% nondeductible excise tax will be imposed on the Fund
to the extent the Fund does not meet certain distribution requirements by the
end of each calendar year.

Gains or losses attributable to foreign currency contracts, or to
fluctuations in exchange rates between the time the Fund accrues income,
expenses or other liabilities denominated in a foreign currency and the time the
Fund actually collects such income or pays such liabilities, are treated as
ordinary income or ordinary loss for federal income tax purposes. Similarly,
gains or losses on the disposition of debt securities held by the Fund, if any,
denominated in a foreign currency, to the extent attributable to fluctuations in
exchange rates between the acquisition and disposition dates are also treated as
ordinary income or loss.

Gains or losses on sales of securities by the Fund will be treated as
long-term capital gains or losses if the securities have been held by it for
more than one year except in certain cases where the Fund acquires a put or
writes a call thereon. Other gains or losses on the sale of securities will be
short-term capital gains or losses. Gains and losses on the sale, lapse or other
termination of options on securities will generally be treated as gains and
losses from the sale of securities. If an option written by the Fund on
securities lapses or is terminated through a closing transaction, such as a
purchase by the Fund of the option from its holder, the Fund will generally
realize short-term capital gain or loss, depending on whether the premium income
is greater or less than the amount paid by the Fund in the closing transaction.
If securities are sold by the Fund pursuant to the exercise of a call option
written by it, the Fund will include the premium received in the sale proceeds
of the securities delivered in determining the amount of gain or loss on the
sale. The requirement that the Fund derive less than 30% of its gross income
from gains from the sale of stocks or securities held less than three months may
limit the Fund's ability to write or acquire options. Certain of the Fund's
transactions may be subject to wash sale and short sale provisions of the
Internal Revenue Code which may, among other things, require the Fund to defer
losses. In addition, debt securities acquired by the Fund may be subject to
original issue discount and market discount rules which may, among other things,
cause the Fund to accrue income in advance of the receipt of cash with respect
to interest.

Special rules apply to most options on stock indices, futures contracts and
options thereon, and forward foreign currency exchange contracts in which the
Fund may invest. See "Investment Objective and Policies." These investments will
generally constitute Section 1256 contracts and will be required to be "marked
to market" for federal income tax purposes at the end of the Fund's taxable
year; that is, treated as having been sold at market value. Sixty percent of any
capital gain or loss recognized on such deemed sales and on actual dispositions
will be treated as long-term capital gain or loss, and the remainder will be
treated as short-term capital gain or loss.

Forward currency contracts, options and futures contracts entered into by
the Fund may create "straddles" for federal income tax purposes and this may
affect the character and timing of gains or losses realized by the Fund on such
contracts or options or on the underlying securities. Straddles may also result
in the loss of the holding period of underlying property, and therefore, the
Fund's ability to enter into forward currency contracts, options and futures
contracts may be limited by the 30% of gross income test described above.

A "passive foreign investment company" ("PFIC") is a foreign corporation
that, in general, meets either of the following tests: (a) at least 75% of its
gross income is passive or (b) an average of at least 50% of its assets produce,
or are held for the

B-27

<PAGE>

production of, passive income. If the Fund acquires and holds stock in a PFIC
beyond the end of the year of its acquisition, the Fund will be subject to
federal income tax on a portion of any "excess distribution" received on the
stock or of any gain from disposition of the stock (collectively "PFIC income"),
plus interest thereon, even if the Fund distributes the PFIC income as a taxable
dividend to its shareholders. If the Fund elects to treat any PFIC in which it
invests as a "qualified electing fund", then in lieu of the foregoing tax and
interest obligation, the Fund will be required to include in income each year
its pro rata share of the qualified electing fund's annual ordinary earnings and
net capital gain, even if they are not distributed to the Fund; those amounts
would be subject to the distribution requirements applicable to the Fund
described above. It may be very difficult, if not impossible, to make this
election because of certain requirements thereof. Under proposed Treasury
regulations, if the Fund does not or cannot elect to treat such a PFIC as a
"qualified electing fund", the Fund can make a "mark-to-market" election, i.e.,
treat the shares of the PFIC as sold on the last day of the Fund's taxable year,
and thus avoid the special tax and interest charge. The gains the Fund
recognizes from the mark-to-market election would be included as ordinary income
in the net investment income the Fund must distribute to shareholders,
notwithstanding that the Fund would receive no cash in respect of such gains.

Dividends of net investment income will be taxable to a U.S. shareholder as
ordinary income regardless of whether such shareholder receives such dividends
in additional shares or in cash. Dividends received from the Fund will be
eligible for the dividends received deduction for corporate shareholders only to
the extent that the Fund's income is derived from certain dividends received
from domestic corporations. The amount of dividends qualifying for the dividends
received deduction will be designated as such in a written notice to
shareholders mailed not later than 60 days after the end of the Fund's taxable
year. Distributions of net long-term capital gains, if any, will be taxable as
long-term capital gains regardless of whether the shareholder receives such
distribution in additional shares or in cash and regardless of how long the
shareholder has held the Fund's shares, and will not be eligible for the
dividends received deduction for corporations. Any gain or loss realized upon a
sale or redemption of Fund shares by a shareholder who is not a dealer in
securities will be treated as long-term capital gain or loss if the shares have
been held for more than one year and otherwise as short-term capital gain or
loss. However, any loss realized by a shareholder upon the sale of shares in the
Fund held for six months or less will be treated as a long-term capital loss to
the extent of any net long-term capital gain distributions received by the
shareholder. Additionally, any loss realized on a sale, redemption or exchange
of shares of the Fund by a shareholder will be disallowed to the extent the
shares are replaced within a 61-day period (beginning 30 days before the
disposition of shares). Shares purchased pursuant to the reinvestment of a
dividend will constitute a replacement of shares.

Any dividends or capital gains distributions received by a shareholder will
have the effect of reducing the net asset value of the Fund's shares by the
exact amount of the dividend or capital gains distribution. If the net asset
value of the shares should be reduced below a shareholder's cost as a result of
a dividend or capital gains distribution, such dividend or capital gains
distribution, although constituting a return of capital, will be taxable as
described above. Prior to purchasing shares of the Fund, therefore, the investor
should carefully consider the impact of dividends or capital gains distributions
which are expected to be or have been announced.

A shareholder who sells or otherwise disposes of shares of the Fund within
90 days of acquisition may not be allowed to include certain sales charges
incurred in acquiring such shares for purposes of calculating gain or loss
realized upon a sale or exchange of shares of the Fund.

Distributions of net investment income made to a nonresident alien
individual, a nonresident alien fiduciary of a foreign estate or trust, foreign
corporation or foreign partnership (foreign shareholder) will be subject to U.S.
withholding tax at a rate of 30% (or lower treaty rate), unless the dividends
are effectively connected with the U.S. trade or business of the shareholder.
Gains realized upon the sale or redemption of shares of the Fund by a foreign
shareholder and distributions of net long-term capital gains to a foreign
shareholder will generally not be subject to U.S. income tax unless the gain is
effectively connected with a trade or business carried on by the shareholder
within the United States or, in the case of a shareholder who is a nonresident
alien individual, the shareholder is present in the United States for more than
182 days during the taxable year and certain other conditions are met. In the
case of a foreign shareholder who is a nonresident alien individual, the Fund
may be required to withhold U.S. federal income tax at the rate of 31% of
distributions of net long-term capital gains unless IRS Form W-8 is provided. If
distributions are effectively connected with a U.S. trade or business carried on
by a foreign shareholder, distributions of net investment income and net
long-term capital gains will be subject to U.S. income tax at the graduated
rates applicable to U.S. citizens or domestic corporations. Transfers by gift of
shares of the Fund by a foreign shareholder who is a nonresident alien
individual will not be subject to U.S. federal gift tax, but the value of the
shares of the Fund held by such a shareholder at his death will be includable in
his gross estate for U.S. federal estate tax purposes. The tax consequences to a
foreign shareholder entitled to claim the benefits of an applicable tax treaty
may be different from those described herein. Foreign shareholders are advised
to consult their own tax advisers with respect to the particular tax
consequences to them of an investment in the Fund.

Income received by the Fund from sources within foreign countries may be
subject to withholding and other taxes imposed by such countries. Tax
conventions between certain countries and the United States may reduce or
eliminate such taxes. It is

B-28

<PAGE>

impossible to determine the effective rate of foreign tax in advance since the
amount of the Fund's assets to be invested in various countries is not known.

If the Fund is liable for foreign taxes, the Fund expects to meet the
requirements of the Internal Revenue Code for "passing-through" to its
shareholders foreign income taxes paid, but there can be no assurance that the
Fund will be able to do so. Under the Internal Revenue Code, if more than 50% of
the value of the Fund's total assets at the close of its taxable year consists
of stock or securities of foreign corporations, the Fund will be eligible and
may file an election with the Internal Revenue Service to "pass-through" to the
Fund's shareholders the amount of foreign income taxes paid by the Fund.
Pursuant to this election shareholders will be required to: (i) include in gross
income (in addition to taxable dividends actually received) their pro rata share
of the foreign income taxes paid by the Fund; (ii) treat their pro rata share of
foreign income taxes as paid by them; and (iii) either deduct their pro rata
share of foreign income taxes in computing their taxable income or, subject to
certain limitations, use it as a foreign tax credit against U.S. income taxes
imposed on foreign source income. For this purpose, the portion of dividends
paid by the Fund from its foreign source income will be treated as such. No
deduction for foreign taxes may be claimed by a shareholder who does not itemize
deductions. A shareholder that is a nonresident alien individual or foreign
corporation may be subject to U.S. withholding tax on the income resulting from
the election described in this paragraph, but may not be able to claim a credit
or deduction against such tax for the foreign taxes treated as having been paid
by such shareholder. A tax-exempt shareholder will not ordinarily benefit from
this election. The amount of foreign taxes for which a shareholder may claim a
credit in any year will generally be subject to various limitations including a
separate limitation for "passive income," which includes, among other things,
dividends, interest and certain foreign currency gains.

Each shareholder will be notified within 60 days after the close of the
Fund's taxable year whether the foreign income taxes paid by the Fund will
"pass-through" for that year and, if so, such notification will designate (a)
the shareholder's portion of the foreign income taxes paid to each such country
and (b) the portion of the dividend which represents income derived from sources
within each such country.

The per share dividends on Class B and Class C shares will be lower than
the per share dividends on Class A shares as a result of the higher
distribution-related fee applicable to the Class B and Class C shares. The per
share distributions of net capital gains, if any, will be paid in the same
amount for Class A, Class B and Class C shares. See "Net Asset Value."

Distributions may be subject to additional state and local taxes.

Pennsylvania Personal Property Tax. The Fund has received a written letter
of determination from the Pennsylvania Department of Revenue that the Fund will
be subject to the Pennsylvania foreign franchise and corporate net income tax by
reason of the Fund's business activities in Pennsylvania. Accordingly, it is
believed that Fund shares are exempt from Pennsylvania personal property taxes.
The Fund anticipates that it will continue such business activities but reserves
the right to suspend them at any time, resulting in the termination of the
exemption.

CUSTODIAN, TRANSFER AND DIVIDEND DISBURSING AGENT AND
INDEPENDENT ACCOUNTANTS

State Street Bank and Trust Company, One Heritage Drive, North Quincy,
Massachusetts 02171, serves as Custodian for the Fund's portfolio securities and
cash and in that capacity maintains certain financial and accounting books and
records pursuant to an agreement with the Fund. Subcustodians provide custodial
services for the Fund's foreign assets held outside the United States. See
"General Information--Custodian and Transfer and Dividend Disbursing Agent" in
the Prospectus.

Prudential Mutual Fund Services, Inc. (PMFS), Raritan Plaza One, Edison,
New Jersey 08837, serves as the Transfer and Dividend Disbursing Agent of the
Fund. Its mailing address is P.O. Box 15005, New Brunswick, New Jersey
08906-5005. PMFS is a wholly-owned subsidiary of PMF. PMFS provides customary
transfer agency services to the Fund, including the handling of shareholder
communications, the processing of shareholder transactions, the maintenance of
shareholder account records, payment of dividends and distributions, and related
functions. For these services, PMFS receives an annual fee per shareholder
account, a new account set-up fee for each manually-established account and a
monthly inactive zero balance account fee per shareholder account. PMFS is also
reimbursed for its out-of-pocket expenses, including but not limited to postage,
stationery, printing, allocable communications expenses and other costs. For the
fiscal year ended October 31, 1994, the Fund incurred fees of approximately
$727,000 for the services of PMFS.

Deloitte & Touche LLP, Two World Financial Center, New York, New York
10281, serves as the Fund's independent accountants, and in that capacity audits
the Fund's annual financial statements.

B-29

<PAGE>

PRUDENTIAL GLOBAL FUND, INC. Portfolio of Investments
October 31, 1994
<TABLE>
<CAPTION>
Value
Shares Description (Note 1)
<C> <S> <C>
COMMON STOCKS--87.5%
AUSTRALIA--6.9%
337,000 Brambles Industries, Ltd. $ 3,373,228
(Business & public
services)
423,100 Broken Hill Proprietary
Co., Ltd. ............... 6,490,815
(Energy sources)
1,848,539 BTR Nylex, Ltd. .......... 3,280,593
(Industrial components)
983,751 Coca Cola Amatil, Ltd. ... 6,209,120
(Food & household
products)
1,365,000 Nine Network Australia, 4,115,139
Ltd. ...................
(Broadcasting &
Publishing)
1,627,325 Western Mining Corp. 10,138,230
Holdings, Ltd. ------------
(Non-ferrous metals)
33,607,125
------------
BELGIUM--0.7%
4,600 Bekaert S.A., N.V. ....... 3,566,526
(Industrial components) ------------

FEDERAL REPUBLIC OF GERMANY--2.5%
20,000 BASF AG .................. 4,232,290
(Chemicals)
1,000 BASF AG, Dem50 (var) ..... 211,614
(Chemicals)
6,288 Bilfinger & Berger AG .... 3,549,189
(Construction & housing)
13,600 Preussag AG .............. 3,982,847
(Multi-industry) ------------
11,975,940
------------
FINLAND--1.0%
170,100 Kymmene Corp. ............ 4,650,163
(Forest products & paper) ------------

FRANCE--4.8%
7,000 Guyenne et Gascogne* ..... $ 1,889,320
(Merchandising)
40,900 Imetal S.A. .............. 4,367,960
(Miscellaneous materials
& commodities)
3,850 La Farge Coppee (New) .... 305,234
(Building materials &
components)
46,850 La Farge Coppee (Old) .... 3,714,340
(Building materials &
components)
4,300 Legrand S.A. ............. 5,761,165
(Electronics)
18,300 Plastic Omnium ........... 2,256,408
(Automotive)
90,800 Valeo .................... 4,927,884
(Automotive) ------------
23,222,311
------------
HONG KONG--4.8%
5,850,130 CDL Hotels International* 2,687,708
........................
(Real estate)
1,470,000 CITIC Pacific, Ltd. ...... 4,423,126
(Transportation)
1,680,000 Guoco Group, Ltd. ........ 7,935,809
(Financial services)
8,990,000 Hung Hing Printing Group, 1,942,964
Ltd. ...................
(General manufacturing)
1,378,000 Hutchison Whampoa, Ltd.* .. 6,366,585
(Multi-industry) ------------

23,356,192
------------
INDONESIA--0.5%
1,734,000 Kabel Metal Industries,
Ltd.* .................. 2,495,824
(Wire & cable)
</TABLE>

B-30 See Notes to Financial Statements.
<PAGE>
PRUDENTIAL GLOBAL FUND, INC.
<TABLE>
<CAPTION>
Value
Shares Description (Note 1)
<C> <S> <C>
JAPAN--16.0%
104,000 Acom Co., Ltd. ........... $ 3,820,846
(Financial services)
199,000 Aiwa Co. ................. 5,421,672
(Consumer electronics)
7,100 Autobacs Seven Co. ....... 893,910
(Merchandising)
520 Ddi Corp. ................ 4,711,662
(Telecommunications)
33,000 Japan Associates Finance
Co. .................... 4,869,969
(Financial services)
367,000 Kamigumi Co., Ltd. ....... 4,014,654
(Transportation &
warehousing)
48,000 Keyence Corp. ............ 5,795,666
(Electronic components)
81,000 Kyocera Corp. ............ 6,169,040
(Public works -
electronics)
598,000 Minebea Co. .............. 5,190,072
(Industrial components)
86,500 Murata Manufacturing Co.,
Ltd. ................... 3,534,985
(Electronic components)
101,800 Nichiei Co. .............. 6,566,047
(Financial services)
77,200 Nissen Co., Ltd. ......... 3,154,923
(Merchandising)
150,000 Nisshin Steel Company .... 788,980
(Metals)
129,000 Rohm Co., Ltd. ........... 5,657,895
(Financial services)
252,000 Shin-Etsu Chemical Co.,
Ltd. ................... 5,357,275
(Chemicals)
84,300 Sony Corp. ............... 4,776,130
(Consumer goods)
105,000 Suzuki Motor Co., Ltd. ... 1,332,816
(Automotive)
169,000 Tokyo Electronic Co., Ltd. $ 5,650,773
------------
(Electronic components)
77,707,315
------------
KOREA--2.1%
9,921 Daewoo Securities Co.,
Ltd.* .................. 441,818
(Financial services)
9,102 Daishin Securities Co.* 203,244
........................
(Financial services)
6,700 Pohang Iron & Steel Co.,
Ltd. ................... 634,573
(Metals)
49,722 Samsung Electronics (Old) . 8,495,435
(Electronics)
2,652 Samsung Electronics (New) . 444,135
(Electronics)
1,400 Shinsegae ................ 168,952
(Merchandising) ------------
10,388,157
------------
MALAYSIA--4.1%
631,600 Malaysian Helicopter ..... 1,557,065
(Transportation)
3,026,000 Renong Berhad ............ 4,736,450
(Infrastructure)
1,146,000 Resorts World ............ 7,264,802
(Leisure & tourism)
1,658,000 Technology Resources
Industries Berhad* ..... 6,455,526
(Data processing & ------------
reproduction)
20,013,843
------------
MEXICO--3.4%
519,700 Apasco, S.A. ............. 4,840,046
(Building materials)
1,449,000 Cifra, S.A. de C.V. ...... 4,124,335
(Merchandising)
787,500 Fomento Economico Mexicano,
S.A. de C.V.* .......... 3,460,782
(Merchandising)
</TABLE>

B-31 See Notes to Financial Statements.
<PAGE>
PRUDENTIAL GLOBAL FUND, INC.
<TABLE>
<CAPTION>
Value
Shares Description (Note 1)
<C> <S> <C>
MEXICO--(cont'd)
Grupo Financiero Banamex
Accival,
S.A. de C.V.
567,000 Class C (Old).............. $ 3,894,412
15,500 Class L (New) ............ 102,852
(Banking) ------------
16,422,427
------------
NETHERLANDS--1.0%
223,700 Royal Boskalis Westminster
N.V. .................... 5,081,678
(Construction & housing) ------------

NEW ZEALAND--1.8%
3,186,300 Fletcher Challenge, Ltd. .. 8,594,809
------------
(Forest products & paper)
Singapore--6.1%
135,000 Fraser & Neave Ltd. ...... 1,600,136
(Beverages & tobacco)
997,000 O'Seas Union Bank ........ 5,704,904
(Banking)
982,250 Sembawang Maritime, Ltd. .. 4,717,208
(Transportation)
672,000 Singapore Airlines, Ltd. .. 6,454,496
(Transportation)
709,000 United Overseas Bank, Ltd. 7,775,817
(Banking)
1,575,000 Wing Tai Holdings ........ 3,218,664
(Multi-industry) ------------
29,471,225
------------
SPAIN--2.8%
33,200 Acerinox S.A. ............ 3,678,273
(Metals-steel)
214,162 Centros Commerciale (Pryca) 3,526,568
(Merchandising)
178,700 Dragados y Construcciones* 2,671,215
(Construction & housing)
204,583 Vallehermoso (Old) ....... $ 3,663,197
(Real estate) ------------
13,539,253
------------
SWEDEN--4.1%
163,800 Astra B Free ............. 4,381,052
(Health & personal care)
119,700 Hennes & Mauritz B Free 6,636,521
(Merchandising)
93,600 Missouri Och Domsjo AB ... 4,276,741
(Forest products & paper)
241,500 Volvo AB ................. 4,777,149
(Automotive) ------------
20,071,463
------------
THAILAND--0.5%
110,702 Land & House Public Co.,
Ltd. ................... 2,274,181
(Housing)
16,000 Mdx Public Co., Ltd. ..... 89,877
(Real estate) ------------
2,364,058
------------
UNITED KINGDOM--8.0%
304,500 Barclays Bank PLC ........ 2,914,233
(Banking)
168,000 British Land Co. PLC ..... 1,043,043
(Real estate)
304,500 Carlton Communications PLC 4,393,767
(Television &
communication equipment)
231,000 Great Portland Estates PLC 687,804
(Real estate)
618,400 Guest Keen & Nettlefolds 6,161,237
(Automotive)
514,500 J. Sainsbury PLC ......... 3,358,454
(Merchandising)
114,400 MEPC PLC ................. 795,419
(Real estate)
367,500 PowerGen PLC* ............ 3,414,969
(Utilities-electric &
gas)
</TABLE>

B-32 See Notes to Financial Statements.
<PAGE>
PRUDENTIAL GLOBAL FUND, INC.
<TABLE>
<CAPTION>
Value
Shares Description (Note 1)
<C> <S> <C>
UNITED KINGDOM--(cont'd)
246,700 S.G. Warburg Group PLC ... $ 2,470,027
(Financial services)
655,700 Siebe PLC ................ 5,792,687
(Machinery & engineering)
183,700 Slough Estates PLC ....... 656,662
(Real estate)
2,117,490 Vodafone Group ........... 7,309,453
(Telecommunications) ------------
38,997,755
------------
UNITED STATES--16.4%
252,300 Adaptec, Inc. ............ 5,865,975
(Electronics/semiconductors)
107,100 Applied Materials, Inc. 5,569,200
(Electronics)
141,000 Cirrus Logic Corp. ....... 4,053,750
(Electronics/semiconductors)
212,600 Electronic Arts, Inc. .... 4,783,500
(Consumer goods)
209,525 Mattel, Inc. ............. 6,128,606
(Recreation & other
consumer goods)
214,100 MCI Communications Corp. 4,924,300
(Telecommunications)
107,500 Microsoft Corp. .......... 6,772,500
(Computer services)
59,600 Mobil Corp. .............. 5,125,600
(Energy sources)
128,300 Motorola, Inc. ........... 7,553,663
(Television &
electronics)
251,900 Nextel Communications, Inc. 5,274,156
(Telecommunications)
189,500 Norwest Corp. ............ 4,642,750
(Banking)
142,800 Oracle Systems Corp. ..... 6,568,800
(Business & public
services)
91,200 Pohang Iron & Steel (ADR) $ 2,998,200
(Metals)
178,400 Silicon Graphics, Inc.* 5,418,900
(Electronic components)
105,000 Time Warner, Inc. ........ 3,727,500
(Broadcasting & ------------
publishing)
79,407,400
------------
Total common stocks
(cost US$346,794,677).... 424,933,464
------------
PREFERRED STOCKS--6.4%
FEDERAL REPUBLIC OF GERMANY--1.0%
5,440 Krones ................... 4,976,525
(Machinery & engineering) ------------

FINLAND--4.0%
130,000 Nokia Corp. .............. 19,602,951
(Television & ------------
electronics)

KOREA--1.4%
70,000 Daewoo Securities Co.,
Ltd.* .................. 1,782,600
(Financial services)
45,060 Daishin Securities Co.* 650,053
(Financial services)
64,970 Mando Machinery Corp. .... 2,445,086
(Automotive Parts)
18,096 Samsung Electronics ...... 1,702,565
(Electronics) ------------
6,580,304
------------
Total preferred stocks
(cost US$15,167,088)..... 31,159,780
------------
WARRANTS*--1.0%

<CAPTION>
Warrants FRANCE
- ----------
<C> <S> <C>
La Farge Coppee
3,500 Warrants expiring April '96
@ FF460.................. 28,238
(Building materials & components)--------
</TABLE>

B-33 See Notes to Financial Statements.
<PAGE>
PRUDENTIAL GLOBAL FUND, INC.
<TABLE>
<CAPTION>
Value
Warrants Description (Note 1)
<C> <S> <C>
JAPAN--1.0%
Autobacs Seven Co.
50 Warrants expiring Feb. '95
@ (YEN)8,089 ........... $ 216,250
(Merchandising)
Autobacs Seven Co.
400 Warrants expiring Mar. '96
@ (YEN)8,231.10 ........ 1,615,000
(Merchandising)
Kamigumi Co., Ltd.
1,000 Warrants expiring Sept. '96
@ (YEN)902 ............. 180,833
(Transportation &
warehousing)
Nissen Co., Ltd.
1,136 Warrants expiring Nov. '96
@ (YEN)1,681 ........... 1,510,488
(Merchandising)
Nitori Co.
5,250 Warrants expiring Feb. '98
@ (YEN)3,268 ........... 823,611
(Merchandising) ------------
4,346,182
------------
SINGAPORE
Kim Eng Holdings
327,400 Warrants expiring Nov. '97
@ SGD2.00 .............. 189,571
(Financial services) ------------
Total Warrants
(cost US$2,663,038)...... 4,563,991
------------
<CAPTION>
Principal
Amount
(000)
<C> <S> <C>
CORPORATE BONDS--2.0%
MALAYSIA--1.4%
IJM Corp. Berbad
MYR 2,400 Convertible unsecured loan
stock
7.00%, 2/15/97 ......... $ 6,926,237
(Construction & housing) ------------

SINGAPORE--0.2%
Kim Eng Holdings
SGD 165 Loan Stock
3.50%, 1/20/97 ......... 103,968
(Financial Services)
Sembawang Maritime, Ltd.
SGD 524 Convertible unsecured loan
stock
1.50%, 10/25/98 ........ 820,981
(Transportation) ------------
924,949
------------
THAILAND--0.4%
MDX Public Co.
Convertible bond
USD 2,324 4.75%, 9/17/03 ........... 1,911,490
(Real Estate) ------------
Total corporate bonds
(cost US$4,936,948)...... 9,762,676
------------
TOTAL INVESTMENTS--96.9%
(cost US$369,561,751; Note
4)....................... 470,419,911
Other assets in excess of
liabilities--3.1%........ 15,120,056
------------
NET ASSETS--100%........... $485,539,967
------------
------------
<FN>
- ---------------
*Non-income producing security.
ADR--American Depository Receipt
</FN>
</TABLE>
B-34 See Notes to Financial Statements.

<PAGE>
PRUDENTIAL GLOBAL FUND, INC.
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
ASSETS October 31, 1994
----------------
<S> <C>
Investments, at value (cost $369,561,751)............................................... $470,419,911
Foreign currency, at value (cost $5,436,182)............................................ 5,542,343
Cash.................................................................................... 3,782,699
Receivable for investments sold......................................................... 8,314,785
Receivable for Fund shares sold......................................................... 1,941,861
Dividends and interest receivable....................................................... 1,178,170
Deferred expenses and other assets...................................................... 10,305
----------------
Total assets...................................................................... 491,190,074
----------------
LIABILITIES
Payable for investments purchased....................................................... 3,450,050
Payable for Fund shares reacquired...................................................... 1,188,448
Due to Distributors..................................................................... 334,334
Due to Manager.......................................................................... 298,948
Accrued expenses........................................................................ 258,520
Withholding taxes payable............................................................... 63,106
Deferred Thailand capital gains tax..................................................... 56,701
----------------
Total liabilities................................................................. 5,650,107
----------------
NET ASSETS.............................................................................. $485,539,967
----------------
----------------
Net assets were comprised of:
Common stock, at par.................................................................. $ 332,974
Paid-in capital in excess of par...................................................... 376,179,248
----------------
376,512,222
Undistributed net investment income................................................... 1,763,101
Accumulated net realized gain on investment and foreign currency transactions......... 6,424,560
Net unrealized appreciation on investments and foreign currencies..................... 100,840,084
----------------
Net assets, October 31, 1994.......................................................... $485,539,967
----------------
----------------
Class A:
Net asset value and redemption price per share
($73,814,857 / 4,956,216 shares of common stock issued and outstanding)............. $14.89
Maximum sales charge (5% of offering price)........................................... .78
----------------
Maximum offering price to public...................................................... $15.67
----------------
----------------
Class B:
Net asset value, offering price and redemption price per share
($410,519,780 / 28,258,174 shares of common stock issued and outstanding)........... $14.53
----------------
----------------
Class C:
Net asset value, offering price and redemption price per share
($1,205,330 / 82,973 shares of common stock issued and outstanding)................. $14.53
----------------
----------------
</TABLE>

See Notes to Financial Statements.
B-35

<PAGE>
PRUDENTIAL GLOBAL FUND, INC.
Statement of Operations
<TABLE>
<CAPTION>
Year
Ended
October 31,
NET INVESTMENT INCOME 1994
-----------
<S> <C>
Income
Dividends (net of foreign withholding
taxes of $586,932)................. $ 4,812,284
Interest (net of foreign withholding
taxes of $5,369)................... 317,132
-----------
Total income....................... 5,129,416
-----------
Expenses
Distribution fee--Class A............ 146,139
Distribution fee--Class B............ 3,229,844
Distribution fee--Class C............ 1,554
Management fee....................... 3,032,864
Transfer agent's fees and expenses... 870,000
Custodian's fees and expenses........ 800,000
Reports to shareholders.............. 238,000
Registration fees.................... 118,000
Directors' fees...................... 88,000
Audit fee............................ 50,000
Legal fees........................... 45,000
Insurance expense.................... 9,000
Miscellaneous........................ 32,049
-----------
Total operating expenses........... 8,660,450
-----------
Net investment loss.................... (3,531,034)
-----------
REALIZED AND UNREALIZED GAIN
ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS
Net realized gain on:
Investment transactions (net of
Thailand capital gains tax of
$278,312).......................... 17,677,641
Foreign currency transactions........ 360,031
-----------
18,037,672
-----------
Net change in unrealized appreciation
on:
Investments (net of deferred Thailand
capital gains tax of $56,701)...... 29,631,662
Foreign currencies................... 36,676
-----------
29,668,338
-----------
Net gain on investments and foreign
currencies........................... 47,706,010
-----------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS.............. $44,174,976
===========
</TABLE>
See Notes to Financial Statements.

PRUDENTIAL GLOBAL FUND, INC.
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended October 31,
INCREASE (DECREASE) IN ------------------------------
NET ASSETS 1994 1993
------------- -------------
<S> <C> <C>
Operations
Net investment loss... $ (3,531,034) $ (669,977)
Net realized gain on
investment and
foreign currency
transactions........ 18,037,672 12,160,987
Net change in
unrealized
appreciation of
investments and
foreign
currencies.......... 29,668,338 55,989,764
------------- -------------
Net increase in net
assets resulting
from operations..... 44,174,976 67,480,774
------------- -------------
Net equalization
credits............... 193,130 134,235
------------- -------------
Fund share transactions
(Note 5)
Net proceeds from
shares subscribed... 373,867,022 153,827,341
Cost of shares
reacquired............ (225,849,388) (120,699,004)
------------- -------------
Net increase in net
assets from Fund
share
transactions........ 148,017,634 33,128,337
------------- -------------
Total increase.......... 192,385,740 100,743,346

NET ASSETS
Beginning of year....... 293,154,227 192,410,881
------------- -------------
End of year............. $ 485,539,967 $ 293,154,227
============= =============
</TABLE>
See Notes to Financial Statements.
B-36
<PAGE>
PRUDENTIAL GLOBAL FUND, INC.
Notes to Financial Statements
Prudential Global Fund, Inc. (the "Fund") is registered under the
Investment Company Act of 1940 as a diversified, open-end management investment
company. The investment objective of the Fund is to seek long-term capital
growth, with income as a secondary objective, by investing in a diversified
portfolio of securities consisting of marketable securities of U.S. and non-U.S.
issuers.

NOTE 1. ACCOUNTING The following is a summary
POLICIES of significant accounting poli-
cies followed by the Fund in
the preparation of its financial statements.

SECURITIES VALUATION: Securities traded on an exchange (whether domestic or
foreign) are valued at the last reported sales price on the primary exchange on
which they are traded. Securities traded in the over-the-counter market
(including securities listed on exchanges for which a last sales price is not
available) are valued at the average of the last reported bid and asked prices.
Short-term securities which mature in more than 60 days are valued based upon
current market quotations. Short-term securities which mature in 60 days or less
are valued at amortized cost which approximates market value.
In connection with transactions in repurchase agreements with U.S. financial
institutions, it is the Fund's policy that its custodian or designated
subcustodians, as the case may be under triparty repurchase agreements, take
possession of the underlying collateral securities, the value of which exceeds
the principal amount of the repurchase transaction including accrued interest.
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.
FOREIGN CURRENCY TRANSLATION: The books and records of the Fund are maintained
in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on
the following basis:
(i) market value of investment securities, other assets and liabilities--at
the closing daily rate of exchange as reported by a major bank;
(ii) purchases and sales of investment securities, income and expenses--at
the rate of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Fund are presented at the foreign exchange
rates and market values at the close of the fiscal year, the Fund does not
isolate that portion of the results of operations arising as a result of changes
in the foreign exchange rates from the fluctuations arising from changes in the
market prices of securities held at fiscal year end. Similarly, the Fund does
not isolate the effect of changes in foreign exchange rates from the
fluctuations arising from changes in the market prices of long-term portfolio
securities sold during the fiscal year.
Net realized gains on foreign currency transactions of $360,031 represent net
foreign exchange gains or losses from sales and maturities of short-term
securities, holding of foreign currencies, currency gains or losses realized
between the trade and settlement dates on security transactions, and the
difference between the amounts of dividends, interest and foreign taxes recorded
on the Fund's books and the U.S. dollar equivalent amounts actually received or
paid. Net unrealized currency gains and losses from valuing foreign currency
denominated assets and liabilities (other than investments) at fiscal year end
exchange rates are reflected as a component of net unrealized appreciation on
investments and foreign currencies.
Foreign security and currency transactions may involve certain considerations
and risks not typically associated with those of domestic origin as a result of,
among other factors, the possibility of political and economic instability and
the level of governmental supervision and regulation of foreign securities
markets.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on the trade date. Realized gains and losses from investment and
currency transactions are calculated on the identified cost basis. Dividend
income is recorded on the ex-dividend date, and interest income is recorded on
an accrual basis.
Net investment income (other than distribution fees) and unrealized and
realized gains or losses are allocated daily to each class of shares of the Fund
based upon the relative proportion of net assets of each class at the beginning
of the day.
EQUALIZATION: The Fund follows the accounting practice known as equalization by
which a portion of the proceeds from sales and costs of reacquisitions of Fund
shares, equivalent on a per share basis to the amount of distributable net
investment income on the date of the transaction, is credited or charged to
undistributed net investment income. As a result, undistributed net investment
income per share is unaffected by sales or reacquisitions of the Fund's shares.

B-37

<PAGE>
RECLASSIFICATION OF CAPITAL ACCOUNTS: The Fund accounts and reports for
distributions to shareholders in accordance with the A.I.C.P.A.'s Statement of
Position 93-2: Determination, Disclosure, and Financial Statement Presentation
of Income, Capital Gain, and Return of Capital Distributions by Investment
Companies. The effect caused by adopting this statement was to decrease paid-in
capital in excess of par by $2,237,611, increase undistributed net investment
income by $2,350,294, and decrease accumulated net realized gain on investments
and foreign currency transactions by $112,683 for the period ended October 31,
1994.
DIVIDENDS AND DISTRIBUTIONS: The Fund expects to pay dividends of net investment
income and distributions of net realized capital and currency 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. These differences are primarily due to differing
treatments for foreign currency transactions.
Federal Income Taxes: It is the Fund's policy to continue 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.
Withholding taxes on foreign dividends, interest and capital gains have been
provided for in accordance with the Fund's understanding of the applicable
country's tax rules and rates.

NOTE 2. AGREEMENTS The Fund has a management
agreement with Prudential Mutual Fund Management,
Inc. ("PMF"). Pursuant to this agreement, PMF has responsibility for all
investment advisory services and supervises the subadviser's performance of such
services. PMF has entered into a subadvisory agreement with The Prudential
Investment Corporation ("PIC"); PIC furnishes investment advisory services in
connection with the management of the Fund. PMF pays for the cost of the
subadviser's services, the compensation of officers of the Fund, occupancy and
certain clerical and bookkeeping costs of the Fund. The Fund bears all other
costs and expenses.
The management fee paid PMF is computed daily and payable monthly, at an
annual rate of .75 of 1% of the average daily net assets of the Fund.
The Fund has distribution agreements with Prudential Mutual Fund
Distributors, Inc. ("PMFD"), which acts as the distributor of the Class A
shares of the Fund, and with Prudential Securities Incorporated ("PSI"), which
acts as distributor of the Class B and Class C shares of the Fund (collectively
the "Distributors"). The Fund compensates the Distributors for distributing
and servicing the Fund's Class A, Class B and Class C shares, pursuant to plans
of distribution, (the "Class A, B and C Plans") regardless of expenses
actually incurred by them. The distribution fees are accrued daily and payable
monthly.
On July 19, 1994, shareholders of the Fund approved amendments to the Class A
and Class B Plans under which the distribution plans became compensation plans,
effective August 1, 1994. Prior thereto, the distribution plans were
reimbursement plans, under which PMFD and PSI were reimbursed for expenses
actually incurred by them up to the amount permitted under the Class A and Class
B Plans, respectively. The Fund is not obligated to pay any prior or future
excess distribution costs (costs incurred by the Distributors in excess of
distribution fees paid by the Fund or contingent deferred sales charges received
by the Distributors). The rate of the distribution fees charged to Class A and
Class B shares of the Fund did not change under the amended plans of
distribution. The Fund began offering Class C shares on August 1, 1994.
Pursuant to the Class A, B and C Plans, the Fund compensates PMFD for
distribution-related activities with respect to Class A shares at an annual rate
of up to .30 of 1% of the average daily net assets of the Class A shares, .75 of
1% of the average daily net assets up to the level of average daily net assets
as of February 26, 1986, plus 1% of the average daily net assets in excess of
such level of the Class B shares and 1% of average daily net assets of Class C
shares. Such expenses under the Plans were .25 of 1%, .93% of 1% and 1% of the
average daily net assets of Class A, B and C shares, respectively, for the year
ended October 31, 1994.
PMFD has advised the Fund that it has received approximately $575,300 in
front-end sales charges resulting from sales of Class A shares during the fiscal
year ended October 31, 1994. From these fees, PMFD paid such sales charges to
dealers (PSI and Prusec) which in turn paid commissions to salespersons.
PSI has advised the Fund that for the fiscal year ended October 31, 1994, it
received approximately $508,700 in contingent deferred sales charges imposed
upon certain redemptions by Class B and C shareholders.
PMFD is a wholly-owned subsidiary of PMF; PSI, PMF and PIC are indirect,
wholly-owned subsidiaries of The Prudential Insurance Company of America.

B-38

<PAGE>
NOTE 3. OTHER Prudential Mutual Fund Ser-
TRANSACTIONS vices, Inc. ("PMFS"), a
WITH AFFILIATES wholly owned subsidiary of
PMF, serves as the Fund's transfer agent and
during the fiscal year ended October 31, 1994, the Fund incurred fees of
approximately $727,000 for the services of PMFS. As of October 31, 1994,
approximately $67,000 of such fees were due to PMFS. Transfer agent fees and
expenses in the Statement of Operations include certain out-of-pocket expenses
paid to non-affiliates.
For the fiscal year ended October 31, 1994, PSI and/or its foreign affiliates
earned approximately $2,220 in brokerage commissions from portfolio transactions
executed on behalf of the Fund.

NOTE 4. PORTFOLIO Purchases and sales of invest-
SECURITIES ment securities, other than
short-term investments, for the six months ended
October 31, 1994 were $342,678,644 and $196,526,761, respectively.
The United States federal income tax basis of the Fund's investments at
October 31, 1994 was $370,675,999 and accordingly, net unrealized appreciation
for federal income tax purposes was $99,743,912 (gross unrealized
appreciation--$112,910,743; gross unrealized depreciation--$13,166,831).
The Fund utilized its capital loss carryforward of approximately $11,527,100
to offset the Fund's net taxable gains realized and recognized in the fiscal
year ended October 31, 1994.

NOTE 5. CAPITAL The Fund offers Class A,
Class B and Class C shares. Class A shares are
sold with a front-end sales charge of up to 5%. Class B shares are sold with a
contingent deferred sales charge which declines from 5% to zero depending on the
period of time the shares are held. Class C shares are sold with a contingent
deferred sales charge of 1% during the first year. Class B shares will
automatically convert to Class A shares on a quarterly basis approximately seven
years after purchase commencing in or about February 1995. There are 500 million
shares of common stock, $.01 par value per share, divided into three classes,
designated Class A, Class B and Class C common stock, each of which consists of
166,666,666 2/3 authorized shares.
Transactions in shares of common stock were as follows:
<TABLE>
<CAPTION>
Class A Shares Amount
- ------------------------------ ---------- -------------
<S> <C> <C>
Fiscal year ended
October 31, 1994:
Shares sold................... 8,934,836 $ 124,979,118
Shares reacquired............. (7,169,344) (100,448,720)
---------- -------------
Net increase in shares
outstanding................. 1,765,492 $ 24,530,398
---------- -------------
---------- -------------
Year ended October 31, 1993:
Shares sold................... 7,605,778 $ 81,814,374
Shares reacquired............. (5,873,417) (61,680,363)
---------- -------------
Net increase in shares
outstanding................. 1,732,361 $ 20,134,011
---------- -------------
---------- -------------
<CAPTION>
Class B
- ------------------------------
<S> <C> <C>
Fiscal year ended
October 31, 1994:
Shares sold................... 17,971,424 $ 247,670,808
Shares reacquired............. (9,114,786) (125,372,515)
---------- -------------
Net increase in shares
outstanding................. 8,856,638 $ 122,298,293
---------- -------------
---------- -------------
Year ended October 31, 1993:
Shares sold................... 6,320,592 $ 72,012,967
Shares reacquired............. (5,752,085) (59,018,641)
---------- -------------
Net increase in shares
outstanding................. 568,507 $ 12,994,326
---------- -------------
---------- -------------
<CAPTION>
Class C
- ------------------------------
<S> <C> <C>
August 3, 1994* through
October 31, 1994:
Shares sold................... 84,982 $ 1,217,096
Shares reacquired............. (2,009) (28,153)
---------- -------------
Net increase in shares
outstanding................. 82,973 $ 1,188,943
---------- -------------
---------- -------------
- ---------------

<FN>
* Commencement of offering of Class C shares.
</FN>
</TABLE>

NOTE 6. DIVIDENDS On December 1, 1994, the
AND DISTRIBUTIONS Board of Trustees of the Fund
declared the following dividends and distributions
per share, payable on December 15, 1994 to shareholders of record on December
18, 1994:
<TABLE>
<CAPTION>
Class A Class B and C
------- -------------
<S> <C> <C>
Long-Term Capital Gains................ $ 0.185 $ 0.185
</TABLE>

B-39
<PAGE>
PRUDENTIAL GLOBAL FUND, INC.
Financial Highlights
<TABLE>
<CAPTION>
Class A Class B
---------------------------------------------------------- -----------------------------------
January 22,
1990@
Year Ended October 31, through Year Ended October 31,
PER SHARE OPERATING ------------------------------------------- October 31, -----------------------------------
PERFORMANCE (1): 1994 1993 1992 1991 1990 1994 1993 1992
<S> <C> <C> <C> <C> <C> <C> <C> <C>
----------- ------- ------- ------- ------------ ----------- -------- --------
Net asset value, beginning of
period..................... $ 13.17 $ 9.58 $ 10.08 $ 9.19 $10.38 $ 12.94 $ 9.47 $ 10.05
----------- ------- ------- ------- ------------ ----------- -------- --------
Income from investment
operations
Net investment income
(loss)..................... (.04) .02 .03 .07 .12 (.13) (.04) (.05)
Net realized and unrealized
gain (loss) on investment
and foreign currency
transactions............... 1.76 3.57 (.53) 1.02 (1.31) 1.72 3.51 (.53)
----------- ------- ------- ------- ------------ ----------- -------- --------
Total from investment
operations............... 1.72 3.59 (.50) 1.09 (1.19) 1.59 3.47 (.58)
Less distributions
Dividends from net investment
income..................... -- -- -- (.16) -- -- -- --
Distributions paid to
shareholders from net
realized gains on
investment and foreign
currency transactions...... -- -- -- (.04) -- -- -- --
----------- ------- ------- ------- ------------ ----------- -------- --------
Total distributions........ -- -- -- (.20) -- -- -- --
----------- ------- ------- ------- ------------ ----------- -------- --------
Net asset value, end of
period..................... $ 14.89 $ 13.17 $ 9.58 $ 10.08 $ 9.19 $ 14.53 $ 12.94 $ 9.47
----------- ------- ------- ------- ------------ ----------- -------- --------
----------- ------- ------- ------- ------------ ----------- -------- --------
TOTAL RETURN#:............... 13.06% 37.47% (4.96)% 12.11% (11.46)% 12.29% 36.64% (5.77)%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000)...................... $73,815 $42,021 $13,973 $14,154 $8,727 $ 410,520 $251,133 $178,438
Average net assets (000)..... $58,455 $21,409 $14,758 $10,593 $7,151 $ 345,771 $183,741 $210,464
Ratios to average net assets:
Expenses, including
distribution fees........ 1.55% 1.56% 1.71% 1.72% 1.57%* 2.24% 2.24% 2.40%
Expenses, excluding
distribution fees........ 1.30% 1.36% 1.51% 1.52% 1.37%* 1.30% 1.36% 1.51%
Net investment
income/loss................ (0.29)% 0.20% 0.22% 0.65% 1.61%* (0.97)% (0.39)% (0.47)%
Portfolio turnover rate...... 49% 69% 58% 126% 35% 49% 69% 58%

<CAPTION>
Class C
-----------
August 3,
1994@@
through
PER SHARE OPERATING October 31,
PERFORMANCE (1): 1991 1990 1994
<S> <C> <C> <C>
-------- -------- -----------
Net asset value, beginning of
period..................... $ 9.14 $ 10.46 $ 14.03
-------- -------- -----------
Income from investment
operations
Net investment income
(loss)..................... -- .05 (.03)
Net realized and unrealized
gain (loss) on investment
and foreign currency
transactions............... 1.02 (1.10) .53
-------- -------- -----------
Total from investment
operations............... 1.02 (1.05) .50
Less distributions
Dividends from net investment
income..................... (.07) (.18) --
Distributions paid to
shareholders from net
realized gains on
investment and foreign
currency transactions...... (.04) (.09) --
-------- -------- -----------
Total distributions........ (.11) (.27) --
-------- -------- -----------
Net asset value, end of
period..................... $ 10.05 $ 9.14 $ 14.53
-------- -------- -----------
-------- -------- -----------
TOTAL RETURN#:............... 11.29% (10.43)% 3.56%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000)...................... $249,582 $261,555 $ 1,205
Average net assets (000)..... $253,866 $328,467 $ 630
Ratios to average net assets:
Expenses, including
distribution fees........ 2.44% 2.23% 2.63%*
Expenses, excluding
distribution fees........ 1.53% 1.37% 1.63%*
Net investment
income/loss................ (0.01)% 0.51% (1.21)%*
Portfolio turnover rate...... 126% 35% 49%
- ---------------
<FN>
* Annualized.
@ Commencement of offering of Class A shares.
@@ Commencement of offering of Class C shares.
(1) Based on average shares outstanding, by class.
# Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase
of shares on the first day and a sale on the last day of each period reported and includes reinvestment
of dividends and distributions. Total returns for periods of less than a full year are not annualized.
## Because of the events referred to in @@ and the timing of such, the ratios for the Class C shares are not
necessarily comparable to that of Class A or B shares and are not necessarily indicative of future
ratios.
</FN>
</TABLE>

See Notes to Financial Statements.
B-40
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Shareholders and Board of Directors
Prudential Global Fund, Inc.
We have audited the accompanying statement of assets and liabilities of
Prudential Global Fund, Inc., including the portfolio of investments, as of
October 31, 1994, the related statements of operations for the year then ended
and of changes in net assets for each of the two years in the period then ended,
and the financial highlights for each of the five years in the period then
ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of the securities owned as of
October 31, 1994 by correspondence with the custodian and brokers; where replies
were not received from brokers, we performed other auditing procedures. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Prudential Global
Fund, Inc. as of October 31, 1994, the results of its operations, the changes in
its net assets, and its financial highlights for the respective stated periods,
in conformity with generally accepted accounting principles.
Deloitte & Touche LLP
New York, New York
December 16, 1994
FEDERAL INCOME TAX INFORMATION
In January 1995, you will be advised on IRS Form 1099, DIV or substitute Form
1099, as to the federal tax status of the distributions received by you in
calendar 1994.
B-41

<PAGE>

- --------------------------------------------------------------------------------
I N D E P E N D E N T A U D I T O R S ' R E P O R T
- --------------------------------------------------------------------------------

The Shareholders and Board of Directors
Prudential Global Fund, Inc.

We have audited the accompanying statement of assets and liabilities of
Prudential Global Fund, Inc., including the portfolio of investments, as of
October 31, 1994, the related statements of operations for the year then ended
and of changes in net assets for each of the two years in the period then ended,
and the financial highlights for each of the five years in the period then
ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of the securities owned as of
October 31, 1994 by correspondence with the custodian and brokers; where replies
were not received from brokers, we performed other auditing procedures. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Prudential Global
Fund, Inc. as of October 31, 1994, the results of its operations, the changes in
its net assets and the financial highlights for the respective stated periods in
conformity with generally accepted accounting principles.

Deloitte & Touche LLP
New York, New York
December 16, 1994
B-42

<PAGE>

Prudential Mutual Funds
Supplement dated August 1, 1995

The following information supplements the Statement of
Additional Information of each of the Funds listed below.

MANAGER

Prudential Mutual Fund Management, Inc. (PMF or the Manager), the Manager
of the Fund, is a subsidiary of Prudential Securities Incorporated and The
Prudential Insurance Company of America (Prudential). PMF has three wholly-owned
subsidiaries: Prudential Mutual Fund Distributors, Inc., Prudential Mutual Fund
Services, Inc. (PMFS or the Transfer Agent) and Prudential Mutual Fund
Investment Management, Inc. PMFS serves as the transfer agent for the Prudential
Mutual Funds and, in addition, provides customer service, record keeping and
management and administration services to qualified plans.

Prudential is one of the largest diversified financial services institutions
in the world and, based on total assets, the largest insurance company in North
America as of December 31, 1994. Its primary business is to offer a full range
of products and services in three areas: insurance, investments and home
ownership for individuals and families; health-care management and other benefit
programs for employees of companies and members of groups; and asset management
for institutional clients and their associates. Prudential (together with its
subsidiaries) employs nearly 100,000 persons worldwide, and maintains a sales
force of approximately 19,000 agents, 3,400 insurance brokers and 6,000
financial advisors. It insures or provides other financial services to more than
50 million people worldwide. Prudential is a major issuer of annuities,
including variable annuities. Prudential seeks to develop innovative products
and services to meet consumer needs in each of its business areas.

<PAGE>

Investment advisory services are provided to the Fund by a unit of The
Prudential Investment Corporation (PIC or the Subadviser), a subsidiary of
Prudential.

The Subadviser maintains a credit unit which provides credit analysis and
research on both tax-exempt and taxable fixed-income securities. The portfolio
manager routinely consults with the credit unit in managing the Fund's
portfolio. The credit unit reviews on an ongoing basis issuers of tax-exempt and
taxable fixed-income obligations, including prospective purchases and portfolio
holdings of the Fund. Credit analysts have broad access to research and
financial reports, data retrieval services and industry analysts.

With respect to taxable fixed-income obligations, credit analysts review
financial statements published by corporate (and governmental) issuers to
examine income statements, balance sheets and cash flow numbers. They evaluate
this data against their expectations of sales, earnings growth and trends in
credit ratios. They study the impact of economic, regulatory and political
developments on companies and industries and look at the relative value of
companies. They are in regular communication both in person and by telephone
with company management, Wall Street analysts and rating agencies.

With respect to tax-exempt issuers, credit analysts review financial and
operating statements supplied by state and local governments and other issuers
of municipal securities to evaluate revenue projections and the financial
soundness of municipal issuers. They study the impact of economic and political
developments on state and local governments, evaluate industry sectors and meet
periodically with public officials and other representatives of state and local
governments and other tax-exempt issuers to discuss such matters as budget
projections, debt policy, the strength of the regional economy and, in the case
of revenue bonds, the demand for facilities. They also make site inspections to

<PAGE>

review specific projects and to evaluate the progress of construction or the
operation of a facility.

Peter Allegrini oversees the municipal bond team at the Subadviser. He also
serves as the portfolio manager of the High Yield Series of Prudential Municipal
Bond Fund and the Pennsylvania Series of Prudential Municipal Series Fund. He
has been in the investment business since 1978.

From time to time, there may be media coverage of portfolio managers and
other investment professionals associated with the Manager and the Subadviser in
national and regional publications, or television and in other media.
Additionally, individual mutual fund portfolios are frequently cited in surveys
conducted by national and regional publications and media organizations such as
The Wall Street Journal, The New York Times, Barron's and USA Today.

SHAREHOLDER INVESTMENT ACCOUNT

Mutual Fund Programs

From time to time, the Fund (or a portfolio of the Fund, if applicable) may
be included in a mutual fund program with other Prudential Mutual Funds. Under
such a program, a group of portfolios will be selected and thereafter promoted
collectively. Typically, these programs are created with an investment theme,
e.g., to seek greater diversification, protection

<PAGE>

from interest rate movements or access to different management styles. In the
event such a program is instituted, there may be a minimum investment
requirement for the program as a whole. The Fund may waive or reduce the minimum
initial investment requirements in connection with such a program.

The mutual funds in the program may be purchased individually or as a part
of the program. Since the allocation of portfolios included in the program may
not be appropriate for all investors, investors should consult their Prudential
Securities Financial Advisor or Prudential/Pruco Securities Representative
concerning the appropriate blend of portfolios for them. If investors elect to
purchase the individual mutual funds that constitute the program in an
investment ratio different from that offered by the program, the standard
minimum investment requirements for the individual mutual funds will apply.

<PAGE>

APPENDIX--GENERAL INVESTMENT INFORMATION

The following terms are used in mutual fund investing.

Asset Allocation

Asset allocation is a technique for reducing risk, providing balance. Asset
allocation among different types of securities within an overall investment
portfolio helps to reduce risk and to potentially provide stable returns, while
enabling investors to work toward their financial goal(s). Asset allocation is
also a strategy to gain exposure to better performing asset classes while
maintaining investment in other asset classes.

Diversification

Diversification is a time-honored technique for reducing risk, providing
``balance'' to an overall portfolio and potentially achieving more stable
returns. Owning a portfolio of securities mitigates the individual risks (and
returns) of any one security. Additionally, diversification among types of
securities reduces the risks and (general returns) of any one type of security.

Duration

Debt securities have varying levels of sensitivity to interest rates. As
interest rates fluctuate, the value of a bond (or a bond portfolio) will
increase or decrease. Longer term bonds are generally more sensitive to changes
in interest rates. When interest rates fall, bond prices generally rise.
Conversely, when interest rates rise, bond prices generally fall.

Duration is an approximation of the price sensitivity of a bond (or a bond
portfolio) to interest rate changes. It measures the weighted average maturity
of a bond's (or a bond portfolio's) cash flows, i.e., principal and interest
rate payments. Duration is expressed as a measure of time in years--the longer

<PAGE>

the duration of a bond (or a bond portfolio), the greater the impact of interest
rate changes on the bond's (or the bond portfolio's) price. Duration differs
from effective maturity in that duration takes into account call provisions,
coupon rates and other factors. Duration measures interest rate risk only and
not other risks, such as credit risk and, in the case of non-U.S. dollar
denominated securities, currency risk. Effective maturity measures the final
maturity dates of a bond (or a bond portfolio).

Market Timing

Market timing--buying securities when prices are low and selling them when
prices are relatively higher--may not work for many investors because it is
impossible to predict with certainty how the price of a security will fluctuate.
However, owning a security for a long period of time may help investors offset
short-term price volatility and realize positive returns.

Power of Compounding

Over time, the compounding of returns can significantly impact investment
returns. Compounding is the effect of continuous investment on long-term
investment results, by which the proceeds of capital appreciation (and income
distributions, if elected) are reinvested to contribute to the overall growth of
assets. The long-term investment results of compounding may be greater than that
of an equivalent initial investment in which the proceeds of capital
appreciation and income distributions are taken in cash.

<PAGE>

APPENDIX--PORTFOLIO MANAGERS

The following information supplements only the Statement of Additional
Information of the captioned Fund.

Prudential High Yield Fund, Inc.

According to data provided by Lipper Analytical Services, Inc., Prudential
High Yield Fund, Inc. is among the oldest and largest U.S. mutual funds in the
high current yield category of taxable fixed-income funds. Lars Berkman has
served as the Fund's portfolio manager since 1991. In managing the Fund, he
seeks to identify well priced, high yield securities consistent with the Fund's
investment objective. Mr. Berkman is assisted by a team of credit analysts who
analyze corporate cash flows, sales, earnings and management trends.

Prudential Diversified Bond Fund, Inc.
Prudential Government Income Fund, Inc.

Barbara Kenworthy serves as the portfolio manager of Prudential Diversified
Bond Fund, Inc. and Prudential Government Income Fund, Inc. and has 20 years of
investment management experience in both U.S. and foreign securities and
investment grade and high yield quality bonds. Ms. Kenworthy actively manages
each Fund's portfolio according to the investment adviser's interest rate
outlook. Consistent with each Fund's investment objective and policies, she
will, at times, invest in different sectors of the fixed-income markets seeking
price discrepancies and more favorable interest rates. The investment adviser
conducts extensive analysis of U.S. and overseas markets in an attempt to
identify trends in interest rates, supply and demand and economic growth. The
portfolio manager then selects the sectors, maturities and individual bonds she
believes provide the best value under those conditions. The portfolio manager is

<PAGE>

assisted by two credit analysis teams, one that specializes in investment grade
bonds and one that specializes in high yield bonds.

Prudential Municipal Series Fund
(Arizona Series) (Ohio Series) and (Hawaii Income Series)
Prudential California Municipal Fund
(California Series) and (California Income Series)

Christian Smith serves as the portfolio manager of the Arizona Series, Ohio
Series and Hawaii Income Series of Prudential Municipal Series Fund and the
California Series and California Income Series of Prudential California
Municipal Fund. Consistent with each Series' investment objective and policies,
Mr. Smith seeks to invest in bonds with attractive yields and good relative
value in the municipal market. He makes use of Prudential's quantitative and
market analysis tools to structure the portfolios and seeks to achieve an
allocation among different sectors, coupons and maturities to achieve each
Series' investment goals. The portfolio manager also seeks bonds with a high
level of call protection.

<PAGE>

APPENDIX--HISTORICAL PERFORMANCE DATA

The historical performance data contained in this Appendix relies on data
obtained from statistical services, reports and other services believed by the
Manager to be reliable. The information has not been independently verified by
the Manager.

(CHART)

<PAGE>

(CHART)

<PAGE>

(CHART)

<PAGE>

Listed below are the names of the Prudential Mutual Funds and the dates of
the Statements of Additional Information to which this supplement relates.

<TABLE>
<CAPTION>
Name of Fund Statement Date
------------ --------------
<S> <C>
Prudential California Municipal Fund
California Income Series December 30, 1994
California Series December 30, 1994
Prudential Diversified Bond Fund, Inc. January 3, 1995
(as supplemented on June 20, 1995)
Prudential GNMA Fund, Inc. March 2, 1995
Prudential Government Income Fund, Inc. May 1, 1995
Prudential High Yield Fund, Inc. February 28, 1995
Prudential Intermediate Global Income Fund, Inc. March 2, 1995
Prudential Municipal Bond Fund June 30, 1995
Insured Series
High Yield Series
Intermediate Series
Prudential Municipal Series Fund
Arizona Series December 30, 1994
Florida Series December 30, 1994
Georgia Series December 30, 1994
Hawaii Income Series December 30, 1994
Maryland Series December 30, 1994
Massachusetts Series December 30, 1994
Michigan Series December 30, 1994
Minnesota Series December 30, 1994
New Jersey Series December 30, 1994

</TABLE>

<PAGE>

<TABLE>
<CAPTION>
Name of Fund Statement Date
------------ --------------
<S> <C>
New York Series December 30, 1994
North Carolina Series December 30, 1994
Ohio Series December 30, 1994
Pennsylvania Series December 30, 1994
Prudential National Municipals Fund, Inc. February 28, 1995
Prudential Short Term Global Income Fund, Inc.
Global Assets Portfolio January 3, 1995
Short-Term Global Income Portfolio January 3, 1995
Prudential Structured Maturity Fund, Inc. March 1, 1995
Income Portfolio
Prudential U. S. Government Fund January 3, 1995
</TABLE>

MF 950C-10

<PAGE>

Prudential Mutual Funds
Supplement dated September 29, 1995

The following information supplements the Statement of Additional
Information of each of the Funds listed below.

MANAGER

Prudential Mutual Fund Management, Inc. (PMF or the Manager), the Manager
of the Fund, is a subsidiary of Prudential Securities Incorporated (PSI) and The
Prudential Insurance Company of America (Prudential). PMF has three wholly-owned
subsidiaries: Prudential Mutual Fund Distributors, Inc., Prudential Mutual Fund
Services, Inc. (PMFS or the Transfer Agent) and Prudential Mutual Fund
Investment Management, Inc. PMFS serves as the transfer agent for the Prudential
Mutual Funds and, in addition, provides customer service, record keeping and
management and administration services to qualified plans. The Prudential
Investment Corporation (PIC) serves as the investment adviser for each of the
Funds listed below, except for The BlackRock Government Income Trust, Global
Utility Fund, Inc. and Nicholas-Applegate Fund, Inc. See ``How the Fund is
Managed - Manager'' in the Prospectus of each Fund. The unit of PIC which
provides investment advisory services to the Funds is known as Prudential Mutual
Fund Investment Management.

<PAGE>

subsidiaries) employs nearly 100,000 persons worldwide, and maintains a sales
force of approximately 19,000 agents, 3,400 insurance brokers and 6,000
financial advisers. It insures or provides other financial services to more than
50 million people worldwide --to more than one of every five people in the
United States. Prudential is a major issuer of annuities, including variable
annuities. Prudential seeks to develop innovative products and services to meet
consumer needs in each of its business areas. As of December 31, 1994,
Prudential through its subsidiaries provided automobile insurance for more than
1.8 million cars and insured more than 1.5 million homes. For the year ended
December 31, 1994, The Prudential Bank, a subsidiary of Prudential, served
940,000 customers in 50 states providing credit card services and loans totaling
more than $1.2 billion. Assets held by PSI for its clients totaled approximately
$150 billion at December 31, 1994. During 1994, over 28,000 new customer
accounts were opened each month at PSI. The Prudential Real Estate Affiliates,
the fourth largest real estate brokerage network in the United States, has more
than 34,000 brokers and agents and more than 1,100 offices in the United States.

Based on data for the year ended December 31, 1994 for the Prudential Mutual
Funds, on an average day, there are approximately $80 million in common stock
transactions, over $100 million in bond transactions and over $4.1 billion in
money market transactions. In 1994, the Prudential Mutual Funds effected more
than 57,000 trades in money market securities and held on average $21 billion of
money market securities. Based on complex-wide data for the year ended December
31, 1994, on an average day, 7,168 shareholders telephoned PMFS, the Transfer
Agent of the Prudential Mutual Funds, on the Prudential Mutual Funds' toll-free
number. On an annual basis, that represents approximately 1.8 million telephone
calls and approximately 1.1 million fund transactions.

<PAGE>

Listed below are the names of the Prudential Mutual Funds and the dates of
the Statements of Additional Information to which this supplement relates.

<TABLE>
<CAPTION>
Name of Fund Statement Date
------------ --------------
<S> <C>
The BlackRock Government Income Trust August 31, 1995
Command Government Fund August 31, 1995
Command Money Fund August 31, 1995
Command Tax-Free Fund August 31, 1995
Global Utility Fund, Inc. February 1, 1995
Nicholas-Applegate Fund, Inc. March 6, 1995
Nicholas-Applegate Growth Equity Fund
Prudential California Municipal Fund
California Money Market Series December 30, 1994
Prudential Government Securities Trust
Money Market Series August 1, 1995
U.S. Treasury Money Market Series August 1, 1995
Prudential Institutional Liquidity Portfolio, Inc. May 30, 1995
Institutional Money Market Series
Prudential MoneyMart Assets February 28, 1995
Prudential Municipal Series Fund
Connecticut Money Market Series December 30, 1994
Massachusetts Money Market Series December 30, 1994
New Jersey Money Market Series December 30, 1994
New York Money Market Series December 30, 1994
Prudential Special Money Market Fund August 29, 1995
Money Market Series
Prudential Tax-Free Money Fund, Inc. August 1, 1995
</TABLE>

MF950C-13

<PAGE>

PART C

OTHER INFORMATION

Item 24. Financial Statements and Exhibits.

(a) Financial Statements:

(1) The following financial statement is included in the Prospectus as
constituting Part A of this Post-Effective Amendment to the Registration
Statement:

Financial Highlights.

(2) The following financial statements are included in the Statement of
Additional Information constituting Part B of this Post-Effective Amendment to
the Registration Statement:

Independent Auditors' Report.

Portfolio of Investments at October 31, 1994 and April 30, 1995
(unaudited).

Statement of Assets and Liabilities at October 31, 1994 and April 30,
1995 (unaudited).

Statement of Operations for the Year ended October 31, 1994 and the six
months ended April 30, 1995 (unaudited).

Statement of Changes in Net Assets for the years ended October 31, 1994
and 1993 and the six months ended April 30, 1995 (unaudited).

Notes to Financial Statements.

Financial Highlights for the Five Years ended October 31, 1994 and the
six months ended April 30, 1995 (unaudited).

(b) Exhibits:

1. Restated Articles of Incorporation. Incorporated by reference to Exhibit 1
to Post-Effective Amendment No. 17 to the Registration Statement filed on
Form N-1A via EDGAR on January 3, 1995 (File No. 2-89725).

2. Amended and Restated By-Laws of the Registrant, incorporated by reference
to Exhibit 2 to Post-Effective Amendment No. 15 to the Registration
Statement on Form N-1A (File No. 2-89725 filed via EDGAR).

4. (a) Specimen Certificate for shares of Common Stock of the Registrant,
incorporated by reference to Exhibit No. 4 to the Registration Statement on
Form N-1A, Pre-Effective Amendment No. 1 (File No. 2-89725).

(b) Specimen Certificate for shares of Common Stock of the Registrant for
Class A Shares, incorporated by reference to Exhibit 4(b) to Post-Effective
Amendment No. 11 to the Registration Statement on Form N-1A (File No.
2-89725).

(c) Instruments defining rights of shareholders, incorporated by reference
to Exhibit No. 4(c) to the Registration Statement on Form N-1A,
Post-Effective Amendment No. 14 (File No. 2-89725 filed via EDGAR).

5. (a) Management Agreement between the Registrant and Prudential Mutual Fund
Management, Inc., incorporated by reference to Exhibit No. 5(a) to
Post-Effective Amendment No. 7 to Registration Statement on Form N-1A (File
No. 2-89725.)

(b) Subadvisory Agreement between Prudential Mutual Fund Management, Inc.
and The Prudential Investment Corporation, incorporated by reference to
Exhibit No. 5(b) to Post-Effective Amendment No. 7 to the Registration
Statement on Form N-1A (File No. 2-89725).

6. (a) Distribution and Service Agreement for Class A shares as amended and
restated June 5, 1995.*

(b) Distribution and Service Agreement for Class B shares as amended and
restated June 5, 1995.*

C-1

<PAGE>

(d) Form of Distribution and Service Agreement for Class Z shares.*

8. (a) Custodian Agreement between the Registrant and State Street Bank and
Trust Company, incorporated by reference to Exhibit No. 8 to Registration
Statement on Form N-1A (File No. 2-89725).

(b) Form of Amendment to Custodian Agreement.*

9. Transfer Agency and Service Agreement between the Registrant and Prudential
Mutual Fund Services, Inc., incorporated by reference to Exhibit No. 9 to
the Registration Statement on Form N-1A, Post-Effective Amendment No. 7
(File No. 2-89725).

10. Opinion of Sullivan & Cromwell, incorporated by reference to Exhibit No. 10
to the Registration Statement on Form N-1A, Pre-Effective Amendment No. 1
(File No. 2-89725).

11. Consent of Independent Accountants.*

13. Purchase Agreement incorporated by reference to Exhibit No. 13 to the
Registration Statement on Form N-1A, Pre-Effective Amendment No. 1 (File
No. 2-89725).

15. (a) Amended and Restated Distribution and Service Plan for Class A shares
dated July 1, 1993, incorporated by reference to Exhibit No.15(d) to the
Registration Statement on Form N-1A, Post-Effective Amendment No. 14 (File
No. 2-89725) filed via EDGAR.

(b) Amended and Restated Distribution and Service Plan for Class B shares
dated July 1, 1993, incorporated by reference to Exhibit No.15(e) to the
Registration Statement on Form N-1A, Post-Effective Amendment No. 14 (File
No. 2-89725) filed via EDGAR.

(c) Distribution and Service Plan for Class A shares. Incorporated by
reference to Exhibit 6(c) to Post-Effective Amendment No. 17 to the
Registration Statement filed on Form N-1A via EDGAR on January 3, 1995
(File No. 2-89725).

(d) Distribution and Service Plan for Class B shares. Incorporated by
reference to Exhibit 6(d) to Post-Effective Amendment No. 17 to the
Registration Statement filed on Form N-1A via EDGAR on January 3, 1995
(File No. 2-89725).

(e) Distribution and Service Plan for Class C shares. Incorporated by
reference to Exhibit 6(e) to Post-Effective Amendment No. 17 to the
Registration Statement filed on Form N-1A via EDGAR on January 3, 1995
(File No. 2-89725).

16. Schedule of Computation of Performance Quotations, incorporated by
reference to Exhibit No. 16 to the Registration Statement on Form N-1A,
Post-Effective Amendment No. 1 (File No. 2-89725).

17. Financial Data Schedule.*

18. Rule 18f-3 Plan.*

Other Exhibits.
- ----------------
*Filed herewith.

Item 25. Persons Controlled by or under Common Control with Registrant

None.

Item 26. Number of Holders of Securities

As of October 13, 1995, there were 44,259, 47,483, and 652 record holders
of Class A, Class B and Class C common stock, $.01 par value per share, of the
Registrant, respectively.

Item 27. Indemnification

As permitted by Section 17(h) and (i) of the Investment Company Act of 1940
(the 1940 Act) and pursuant to Article VI of the Fund's By-Laws (Exhibit 2 to
the Registration Statement), officers, directors, employees and agents of the
Registrant will not be liable to the Registrant, any stockholder, officer,
director, employee, agent or other person for any action or failure to act,
except for bad faith, willful misfeasance, gross negligence or reckless
disregard of duties, and those individuals may be indemnified against
liabilities in connection with the Registrant, subject to the same exceptions.
Section 2-418 of Maryland General

C-2

<PAGE>

Corporation Law permits indemnification of directors who acted in good faith and
reasonably believed that the conduct was in the best interests of the
Registrant. As permitted by Section 17(i) of the 1940 Act, pursuant to Section
10 of each Distribution Agreement (Exhibits 6(b) and (c) to the Registration
Statement), each Distributor of the Registrant may be indemnified against
liabilities which it may incur, except liabilities arising from bad faith, gross
negligence, willful misfeasance or reckless disregard of duties.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (Securities Act) may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
1940 Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in connection with the successful defense of any
action, suit or proceeding) is asserted against the Registrant by such director,
officer or controlling person in connection with the shares being registered,
the Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the 1940 Act and will be governed by the final adjudication of such
issue.

The Registrant has purchased an insurance policy insuring its officers and
directors against liabilities, and certain costs of defending claims against
such officers and directors, to the extent such officers and directors are not
found to have committed conduct constituting willful misfeasance, bad faith,
gross negligence or reckless disregard in the performance of their duties. The
insurance policy also insures the Registrant against the cost of indemnification
payments to officers and directors under certain circumstances.

Section 9 of the Management Agreement (Exhibit 5(a) to the Registration
Statement) and Section 4 of the Subadvisory Agreement (Exhibit 5(b) to the
Registration Statement) limit the liability of Prudential Mutual Fund
Management, Inc. (PMF) and The Prudential Investment Corporation (PIC),
respectively, to liabilities arising from willful misfeasance, bad faith or
gross negligence in the performance of their respective duties or from reckless
disregard by them of their respective obligations and duties under the
agreements.

The Registrant hereby undertakes that it will apply the indemnification
provisions of its By-Laws and each Distribution Agreement in a manner consistent
with Release No. 11330 of the Securities and Exchange Commission under the 1940
Act so long as the interpretation of Section 17(h) and 17(i) of such Act remain
in effect and are consistently applied.

Item 28. Business and other Connections of Investment Adviser

(a) Prudential Mutual Fund Management, Inc.

See "How the Fund is Managed--Manager" in the Prospectus constituting
Part A of this Registration Statement and "Manager" in the Statement of
Additional Information constituting Part B of this Registration Statement.

The business and other connections of the officers of PMF are listed in
Schedules A and D of Form ADV of PMF as currently on file with the Securities
and Exchange Commission, the text of which is hereby incorporated by reference
(File No. 801-3110, filed on March 30, 1994).

The business and other connections of PMF's directors and principal
executive officers are set forth below. Except as otherwise indicated, the
address of each person is One Seaport Plaza, New York, NY 10292.

Name and Address Position with PMF Principal Occupations
- ---------------- ----------------- ---------------------
<S> <C> <C>

Brendan D. Boyle ...... Executive Vice President, Executive Vice President, Director of Marketing and
Director of Marketing and Director, PMF; Senior Vice President, Prudential
Director Securities Incorporated (Prudential Securities);
Chairman and Director, Prudential Mutual Fund
Distributors, Inc. (PMFD)

Stephen P. Fisher ..... Senior Vice President Senior Vice President, PMF; Senior Vice President,
Prudential Securities; Vice President, PMFD

Frank W. Giordano ..... Executive Vice Executive Vice President, General Counsel, Secretary and
President, General Director, PMF and PMFD; Senior Vice President,
Counsel, Secretary and Prudential Securities; Director, Prudential Mutual Fund
Director Services, Inc. (PMFS)

</TABLE>

C-3

<PAGE>

Name and Address Position with PMF Principal Occupations
- ---------------- ----------------- ---------------------
<S> <C> <C>

Robert F. Gunia ....... Executive Vice President, Executive Vice President, Chief Financial and
Chief Financial and Administrative Officer, Treasurer and Director, PMF;
Administrative Officer, Senior Vice President, Prudential Securities; Executive
Treasurer and Director Vice President, Chief Financial Officer, Treasurer and
Director, PMFD; Director, PMFS

Theresa A. Hamacher .. Director Director, PMF; Vice President, Prudential; Vice President,
Prudential Investment Corporation (PIC)

Timothy J. O'Brien ... Director President, Chief Executive Officer, Chief Operating Officer
and Director, PMFD; Chief Executive Officer and
Director, PMFS; Director, PMF

Richard A. Redeker ... President, Chief President, Chief Executive Officer and Director, PMF;
Executive Officer and Executive Vice President, Director and Member of the
Director Operating Committee, Prudential Securities; Director,
Prudential Securities Group, Inc. (PSG); Executive Vice
President, PIC; Director, PMFD; Director; PMFS

S. Jane Rose ......... Senior Vice President, Senior Vice President and Senior Counsel and Assistant
Senior Counsel Secretary, PMF; Senior Vice President and Senior
and Assistant Counsel, Prudential Securities
Secretary

Donald G. Southwell .. Director Senior Vice President, Prudential; Director, PSG
213 Washington Street
Newark, NJ 07102

</TABLE>

(b) The Prudential Investment Corporation (PIC)

See "How the Fund is Managed--Manager" in the Prospectus constituting Part
A of this Registration Statement and "Manager" in the Statement of Additional
Information constituting Part B of this Registration Statement.

The business and other connections of PIC's directors and executive
officers are as set forth below. Except as otherwise indicated, the address of
each person is Prudential Plaza, Newark, NJ 07101.

Name and Address Position with PIC Principal Occupations
- ---------------- ----------------- ---------------------

<S> <C> <C>
William M. Bethke ... Senior Vice President Senior Vice President, Prudential; Senior Vice President,
Two Gateway Center PIC
Newark, NJ 07102

John D. Brookmeyer, Jr. Senior Vice President and Senior Vice President, Prudential; Senior Vice President
51 JFK Parkway Director and Director, PIC
Short Hills, NJ 07078

Barry M. Gillman .... Director Director, PIC

Theresa A. Hamacher . Vice President Vice President, Prudential; Vice President, PIC; Director,
PMF

Harry E. Knapp, Jr. President, Chairman of the President, Chairman of the Board, Chief Executive Officer
Board, Chief Executive and Director, PIC; Vice President, Prudential
Officer and Director

William P. Link ..... Senior Vice Executive Vice President, Prudential; Senior Vice
Four Gateway Center President President, PIC
Newark, NJ 07102

</TABLE>

C-4

<PAGE>

Name and Address Position with PIC Principal Occupations
- ---------------- ----------------- ---------------------
<S> <C> <C>

Richard A. Redeker .. Executive Vice President President, Chief Executive Officer and Director, PMF
One Seaport Plaza Executive Vice President, Director and Member of the
New York, NY 10292 Operating Committee, Prudential Securities; Director,
PSG; Vice President, PIC; Director, PMFD; Director, PMFS

Eric A. Simonson ... Vice President and Vice President and Director, PIC; Executive Vice President,
Director Prudential

Claude J. Zinngrabe, Jr. Executive Vice President Vice President, Prudential; Executive Vice President, PIC
</TABLE>

Item 29. Principal Underwriters

(a)(i) Prudential Securities

Prudential Securities is distributor for Prudential Government Securities
Trust (Short-Intermediate Term Series), Prudential Jennison Fund, Inc., The
Target Portfolio Trust, for Class B shares of Prudential Adjustable Rate
Securities Fund, Inc., for Class B and Class C shares of Prudential Allocation
Fund, Prudential California Municipal Fund (California Income Series and
California Series), Prudential Diversified Bond Fund, Inc., Prudential Equity
Fund, Inc., Prudential Equity Income Fund, Prudential Europe Growth Fund, Inc.,
Prudential Global Fund, Inc., Prudential Global Genesis Fund, Inc., Prudential
Global Natural Resources Fund, Inc., Prudential Government Income Fund, Inc.,
Prudential Growth Opportunity Fund, Inc., Prudential Mortgage Income Fund, Inc.,
Prudential High Yield Fund, Inc., Prudential Intermediate Global Income Fund,
Inc., Prudential Multi-Sector Fund, Inc., Prudential Municipal Bond Fund,
Prudential Municipal Series Fund (except Connecticut Money Market Series,
Massachusetts Money Market Series, New York Money Market Series and New Jersey
Money Market Series), Prudential National Municipals Fund, Inc., Prudential
Pacific Growth Fund, Inc., Prudential Global Limited Maturity Fund, Inc.,
Prudential Structured Maturity Fund, Inc., Prudential U.S. Government Fund,
Prudential Utility Fund, Inc., Global Utility Fund, Inc., Nicholas-Applegate
Fund, Inc. (Nicholas-Applegate Growth Equity Fund) and The BlackRock Government
Income Trust. Prudential Securities is also a depositor for the following unit
investment trusts:

Corporate Investment Trust Fund
Prudential Equity Trust Shares
National Equity Trust
Prudential Unit Trusts
Government Securities Equity Trust
National Municipal Trust

(ii) Prudential Mutual Fund Distributors, Inc.

Prudential Mutual Fund Distributors, Incorporated is distributor for
Command Government Fund, Command Money Fund, Command Tax-Free Fund, Prudential
California Municipal Fund (California Money Market Series), Prudential
Institutional Liquidity Portfolio, Prudential Intermediate Global Income Fund,
Inc., Prudential-Bache Special Money Market Fund, Inc. (d/b/a Prudential Special
Money Market Fund), Prudential Structured Maturity Fund., Inc., Prudential
Tax-Free Money Fund, Inc., and for Class A shares of Prudential Adjustable Rate
Securities Fund, Inc., Prudential Allocation Fund, Prudential California
Municipal Fund (California Income Series and California Series), Prudential
Diversified Bond Fund, Inc., Prudential Equity Fund, Inc., Prudential Equity
Income Fund, Prudential Europe Growth Fund, Inc., Prudential Global Fund, Inc.,
Prudential Global Genesis Fund, Inc., Prudential Global Natural Resources Fund,
Inc., Prudential Government Income Fund, Inc., Prudential Government Securities
Trust (Money Market Series and U.S. Treasury Money Market Series), Prudential
Growth Opportunity Fund, Inc., Prudential High Yield Fund, Inc., Prudential
Intermediate Global Income Fund, Inc., Prudential-Bache MoneyMart Assets Inc.
(d/b/a Prudential MoneyMart Assets Fund), Prudential Mortgage Income Fund, Inc.,
Prudential Multi-Sector Fund, Inc., Prudential Municipal Bond Fund, Prudential
Municipal Series Fund (Connecticut Money Market Series, Massachusetts Money
Market Series and New York Money Market Series and New Jersey Market Series),
Prudential National Municipals Fund, Inc., Prudential Pacific Growth Fund, Inc.,
Prudential Global Limited Maturity Fund, Inc., Prudential Structured Maturity
Fund, Prudential U.S. Government Fund, Prudential Utility Fund, Inc., Global
Utility Fund, Inc., Nicholas-Applegate Fund, Inc. (Nicholas-Applegate Growth
Equity Fund) and The BlackRock Government Income Trust.

(b)(i) Information concerning the directors and officers of Prudential
Securities Incorporated is set forth below.

C-5

<PAGE>

Positions and Positions and
Offices with Offices with
Name(1) Underwriter Registrant
- ------- ------------- --------------
<S> <C> <C>

Robert Golden ......... Executive Vice President and Director None
One New York Plaza
New York, NY

Alan D. Hogan ......... Executive Vice President, Chief Administrative None
Officer and Director

Howard A. Knight ...... Executive Vice President, Director, Corporate Strategy and None
New Business Development

George A. Murray ...... Executive Vice President, Director None

Leland B. Paton ....... Executive Vice President and Director None
One New York Plaza
New York, NY

Vincent T. Pica, II ... Executive Vice President and Director None
One New York Plaza
New York, NY

Richard A. Redeker .... Executive Vice President and Director President and
Director

Gregory W. Scott ...... Executive Vice President, Chief Financial Officer and Director None

Hardwick Simmons ...... Chief Executive Officer, President and Director None

Lee B. Spencer, Jr. ... General Counsel, Executive Vice President and Director None

</TABLE>

(ii) Information concerning the officers and directors of Prudential Mutual
Fund Distributors, Inc. is set forth below.

Positions and Positions and
Offices with Offices with
Name(1) Underwriter Registrant
- ------- ------------- --------------
<S> <C> <C>
Joanne Accurso-Soto ... Vice President None

Dennis N. Annarumma ... Vice President, Assistant Treasurer and Assistant None
Comptroller

Phyllis J. Berman ..... Vice President None

Brendan D. Boyle ...... Chairman and Director None

Stephen P. Fisher ..... Vice President None

Frank W. Giordano ..... Executive Vice President, General Counsel, Secretary None
and Director

Robert F. Gunia ....... Executive Vice President, Chief Financial Officer, Treasurer,
Vice President

Timothy J. O'Brien .... President, Chief Executive Officer, Chief Operating Officer None
and Director

Richard A. Redeker .... Director Director
and
President

Andrew J. Varley ....... Vice President None

Anita L. Whelan ........ Vice President and Assistant Secretary None

</TABLE>

- ---------------
(1) The address of each person named is One Seaport Plaza, New York, NY 10292
unless otherwise indicated.

Item 30. Location of Accounts and Records

All accounts, books and other documents required to be maintained by
Section 31(a) of the 1940 Act and the Rules thereunder are maintained at the
offices of State Street Bank and Trust Company, 1776 Heritage Drive, North
Quincy, Massachusetts, The Prudential Investment Corporation, Prudential Plaza,
745 Broad Street, Newark, New Jersey 07102, the Registrant, One Seaport Plaza,
New York, New York 10292, and Prudential Mutual Fund Services, Inc., Raritan
Plaza One, Edison, New Jersey 08837. Documents required by Rules 31a-1(b)(5),
(6), (7), (9), (10) and (11) and 31a-1(f) will be kept at Two Gateway Center,
documents required by Rules 31a-1(b)(4) and (11) and 31a-1(d) at One Seaport
Plaza and the remaining accounts, books and other documents required by such
other pertinent provisions of Section 31(a) and the Rules promulgated thereunder
will be kept by State Street Bank and Trust Company and Prudential Mutual Fund
Services, Inc.

Item 31. Management Services

Other than as set forth under the captions "How the Fund is
Managed--Manager" and "How the Fund is Managed--Distributor" in the Prospectus
and the captions "Manager" and "Distributor" in the Statement of Additional
Information, constituting Parts A and B, respectively, of this Registration
Statement, Registrant is not a party to any management-related service contract.

Item 32. Undertakings

The Registrant undertakes to furnish to each person to whom a prospectus is
delivered with a copy of the Registrant's latest annual report to shareholders,
upon request and without charge.

C-6

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this
Post-Effective Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of New York,
and State of New York, on the 1st day of November, 1995.

PRUDENTIAL GLOBAL FUND, INC.

/s/ Richard A. Redeker
------------------------------------
(Richard A. Redeker, President)

Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment to the Registration Statement has been signed below by
the following persons in the capacities and on the dates indicated.

Signature Title Date
--------- ----- ----

/s/ Stephen C. Eyre Director November 1, 1995
- -----------------------
Stephen C. Eyre

/s/ Delayne D. Gold Director November 1, 1995
- -----------------------
Delayne D. Gold

/s/ Dan G. Hoff Director November 1, 1995
- -----------------------
Dan G. Hoff

/s/ Harry A. Jacobs, Jr. Director November 1, 1995
- ------------------------
Harry A. Jacobs, Jr.

/s/ Sidney R. Knafel Director November 1, 1995
- ------------------------
Sidney R. Knafel

/s/ Robert E. LaBlanc Director November 1, 1995
- ------------------------
Robert E. LaBlanc

/s/ Thomas A. Owens, Jr. Director November 1, 1995
- ------------------------
Thomas A. Owens, Jr.

/s/ Richard A. Redeker President and Director November 1, 1995
- ------------------------
Richard A. Redeker

/s/ Clay T. Whitehead Director November 1, 1995
- ------------------------
Clay T. Whitehead

/s/ Grace C. Torres Treasurer, Principal November 1, 1995
- ------------------------ Financial and
Grace C. Torres Accounting Officer

<PAGE>

EXHIBIT INDEX

1. Restated Articles of Incorporation. Incorporated by reference to Exhibit 1
to Post-Effective Amendment No. 17 to the Registration Statement on Form
N-1A via EDGAR on January 3, 1995 (File No. 2-89725).

2. Amended and Restated By-Laws of the Registrant, incorporated by reference to
Exhibit 2 to Post-Effective Amendment No. 15 to the Registration Statement
on Form N-1A (File No. 2-89725 filed via EDGAR).

(b) Specimen Certificate for shares of Common Stock of the Registrant for
Class A Shares, incorporated by reference to Exhibit No. 4(b) to
Post-Effective Amendment No. 11 to the Registration Statement on Form N-1A
(File No. 2-89725).

6. (a) Distribution and Service Agreement for Class A shares as amended and
restated June 5, 1995.*

(b) Distribution and Service Agreement for Class B shares as amended and
restated June 5, 1995.*

(d) Form of Distribution and Service Agreement for Class Z shares.*

8. (a) Custodian Agreement between the Registrant and State Street Bank and
Trust Company, incorporated by reference to Exhibit No. 8 to Registration
Statement on Form N-1A (File No. 2-89725).

(b) Form of Amendment to Custodian Agreement.*

10. Opinion of Sullivan & Cromwell, incorporated by reference to Exhibit No. 10
to the Registration Statement on Form N-1A, Pre-Effective Amendment No. 1
(File No. 2-89725).

11. Consent of Independent Accountants.*

13. Purchase Agreement incorporated by reference to Exhibit No. 13 to the
Registration Statement on Form N-1A, Pre-Effective Amendment No. 1 (File No.
2-89725).

15. (a) Amended and Restated Distribution and Service Plan for Class A shares
dated July 1, 1993, incorporated by reference to Exhibit No. 15(d) to the
Registration Statement on Form N-1A, Post-Effective Amendment No. 14 (File
No. 2-89725) filed via EDGAR.

(b) Amended and Restated Distribution and Service Plan for Class B shares
dated July 1, 1993, incorporated by reference to Exhibit No. 15(e) to the
Registration Statement on Form N-1A, Post-Effective Amendment No. 14 (File
No. 2-89725) filed via EDGAR.

(c) Distribution and Service Plan for Class A shares. Incorporated by
reference to Exhibit 6(c) to Post-Effective Amendment No. 17 to the
Registration Statement on Form N-1A via EDGAR on January 3, 1995 (File No.
2-89725).

(d) Distribution and Service Plan for Class B shares. Incorporated by
reference to Exhibit 6(d) to Post-Effective Amendment No. 17 to the
Registration Statement on Form N-1A via EDGAR on January 3, 1995 (File No.
2-89725).

(e) Distribution and Service Plan for Class C shares. Incorporated by
reference to Exhibit 6(e) to Post-Effective Amendment No. 17 to the
Registration Statement on Form N-1A via EDGAR on January 3, 1995 (File No.
2-89725).

16. Schedule of Computation of Performance Quotations, incorporated by reference
to Exhibit No. 16 to the Registration Statement on Form N-1A, Post-Effective
Amendment No. 1 (File No. 2-89725).

17. Financial Data Schedule.*

18. Rule 18f-3 Plan.*

-----------------
*Filed herewith.

Exhibit 6(a)

PRUDENTIAL GLOBAL FUND, INC.
Distribution Agreement
(Class A Shares)

Agreement made as of August 1, 1994 and amended and restated as of June 5,
1995, between Prudential Global Fund, Inc. a Maryland Corporation (the Fund) and
Prudential Mutual Fund Distributors, Inc., a Delaware Corporation (the
Distributor).

WITNESSETH

WHEREAS, the Fund is registered under the Investment Company Act of 1940,
as amended (the Investment Company Act), as a diversified, open-end, management
investment company and it is in the interest of the Fund to offer its Class A
shares for sale continuously;

WHEREAS, the Distributor is a broker-dealer registered under the Securities
Exchange Act of 1934, as amended, and is engaged in the business of selling
shares of registered investment companies either directly or through other
broker-dealers;

WHEREAS, the Fund and the Distributor wish to enter into an agreement with
each other, with respect to the continuous offering of the Fund's Class A shares
from and after the date hereof in order to promote the growth of the Fund and
facilitate the distribution of its Class A shares; and

WHEREAS, upon approval by the Class A shareholders of the Fund it is
contemplated that the Fund will adopt a plan of distribution pursuant to Rule
12b-1 under the Investment Company Act (the Plan) authorizing payments by the
Fund to the Distributor with respect to the distribution of Class A shares of
the Fund and the maintenance of Class A shareholder accounts.

NOW, THEREFORE, the parties agree as follows:

Section 1. Appointment of the Distributor

The Fund hereby appoints the Distributor as the principal underwriter and
distributor of the Class A shares of the Fund to sell Class A shares to the
public on behalf of the Fund and the Distributor hereby accepts such appointment
and agrees to act hereunder. The Fund hereby agrees during the term of this
Agreement to sell Class A shares of the Fund through the Distributor on the
terms and conditions set forth below.

<PAGE>

Section 2. Exclusive Nature of Duties

The Distributor shall be the exclusive representative of the Fund to act as
principal underwriter and distributor of the Fund's Class A shares, except that:

2.1 The exclusive rights granted to the Distributor to sell Class A shares
of the Fund shall not apply to Class A shares of the Fund issued in connection
with the merger or consolidation of any other investment company or personal
holding company with the Fund or the acquisition by purchase or otherwise of all
(or substantially all) the assets or the outstanding shares of any such company
by the Fund.

2.2 Such exclusive rights shall not apply to Class A shares issued by the
Fund pursuant to reinvestment of dividends or capital gains distributions.

2.3 Such exclusive rights shall not apply to Class A shares issued by the
Fund pursuant to the reinstatement privilege afforded redeeming shareholders.

2.4 Such exclusive rights shall not apply to purchases made through the
Fund's transfer and dividend disbursing agent in the manner set forth in the
currently effective Prospectus of the Fund. The term "Prospectus" shall mean the
Prospectus and Statement of Additional Information included as part of the
Fund's Registration Statement, as such Prospectus and Statement of Additional
Information may be amended or supplemented from time to time, and the term
"Registration Statement" shall mean the Registration Statement filed by the Fund
with the Securities and Exchange Commission and effective under the Securities
Act of 1933, as amended (Securities Act), and the Investment Company Act, as
such Registration Statement is amended from time to time.

Section 3. Purchase of Class A Shares from the Fund

3.1 The Distributor shall have the right to buy from the Fund on behalf of
investors the Class A shares needed, but not more than the Class A shares needed
(except for clerical errors in transmission) to fill unconditional orders for
Class A shares placed with the Distributor by investors or registered and
qualified securities dealers and other financial institutions (selected
dealers).

3.2 The Class A shares shall be sold by the Distributor on behalf of the
Fund and delivered by the Distributor or selected dealers, as described in
Section 6.4 hereof, to investors at the offering price as set forth in the
Prospectus.

2
<PAGE>

3.3 The Fund shall have the right to suspend the sale of its Class A shares
at times when redemption is suspended pursuant to the conditions in Section 4.3
hereof or at such other times as may be determined by the Board of Directors.
The Fund shall also have the right to suspend the sale of its Class A shares if
a banking moratorium shall have been declared by federal or New York
authorities.

3.4 The Fund, or any agent of the Fund designated in writing by the Fund,
shall be promptly advised of all purchase orders for Class A shares received by
the Distributor. Any order may be rejected by the Fund; provided, however, that
the Fund will not arbitrarily or without reasonable cause refuse to accept or
confirm orders for the purchase of Class A shares. The Fund (or its agent) will
confirm orders upon their receipt, will make appropriate book entries and upon
receipt by the Fund (or its agent) of payment therefor, will deliver deposit
receipts for such Class A shares pursuant to the instructions of the
Distributor. Payment shall be made to the Fund in New York Clearing House funds
or federal funds. The Distributor agrees to cause such payment and such
instructions to be delivered promptly to the Fund (or its agent).

Section 4. Repurchase or Redemption of Class A Shares by the Fund

4.1 Any of the outstanding Class A shares may be tendered for redemption at
any time, and the Fund agrees to repurchase or redeem the Class A shares so
tendered in accordance with its Articles of Incorporation as amended from time
to time, and in accordance with the applicable provisions of the Prospectus. The
price to be paid to redeem or repurchase the Class A shares shall be equal to
the net asset value determined as set forth in the Prospectus. All payments by
the Fund hereunder shall be made in the manner set forth in Section 4.2 below.

4.2 The Fund shall pay the total amount of the redemption price as defined
in the above paragraph pursuant to the instructions of the Distributor on or
before the seventh calendar day subsequent to its having received the notice of
redemption in proper form. The proceeds of any redemption of Class A shares
shall be paid by the Fund to or for the account of the redeeming shareholder, in
each case in accordance with applicable provisions of the Prospectus.

4.3 Redemption of Class A shares or payment may be suspended at times when
the New York Stock Exchange is closed for other than customary weekends and
holidays, when trading on said Exchange is restricted, when an emergency exists
as a result of which disposal by the Fund of securities owned by it is not
reasonably practicable or it is not reasonably practicable for the Fund fairly
to determine the value of its net assets, or during any

<PAGE>
other period when the Securities and Exchange Commission, by order, so permits.

Section 5. Duties of the Fund

5.1 Subject to the possible suspension of the sale of Class A shares as
provided herein, the Fund agrees to sell its Class A shares so long as it has
Class A shares available.

5.2 The Fund shall furnish the Distributor copies of all information,
financial statements and other papers which the Distributor may reasonably
request for use in connection with the distribution of Class A shares, and this
shall include one certified copy, upon request by the Distributor, of all
financial statements prepared for the Fund by independent public accountants.
The Fund shall make available to the Distributor such number of copies of its
Prospectus and annual and interim reports as the Distributor shall reasonably
request.

5.3 The Fund shall take, from time to time, but subject to the necessary
approval of the Board of Directors and the shareholders, all necessary action to
fix the number of authorized Class A shares and such steps as may be necessary
to register the same under the Securities Act, to the end that there will be
available for sale such number of Class A shares as the Distributor reasonably
may expect to sell. The Fund agrees to file from time to time such amendments,
reports and other documents as may be necessary in order that there will be no
untrue statement of a material fact in the Registration Statement, or necessary
in order that there will be no omission to state a material fact in the
Registration Statement which omission would make the statements therein
misleading.

5.4 The Fund shall use its best efforts to qualify and maintain the
qualification of any appropriate number of its Class A shares for sales under
the securities laws of such states as the Distributor and the Fund may approve;
provided that the Fund shall not be required to amend its Articles of
Incorporation or By-Laws to comply with the laws of any state, to maintain an
office in any state, to change the terms of the offering of its Class A shares
in any state from the terms set forth in its Registration Statement, to qualify
as a foreign corporation in any state or to consent to service of process in any
state other than with respect to claims arising out of the offering of its Class
A shares. Any such qualification may be withheld, terminated or withdrawn by the
Fund at any time in its discretion. As provided in Section 9.1 hereof, the
expense of qualification and maintenance of qualification shall be borne by the
Fund. The Distributor shall furnish such information and other material relating
to its affairs and activities as may be required by the Fund in connection with
such qualifications.

<PAGE>

Section 6. Duties of the Distributor

6.1 The Distributor shall devote reasonable time and effort to effect sales
of Class A shares of the Fund, but shall not be obligated to sell any specific
number of Class A shares. Sales of the Class A shares shall be on the terms
described in the Prospectus. The Distributor may enter into like arrangements
with other investment companies. The Distributor shall compensate the selected
dealers as set forth in the Prospectus.

6.2 In selling the Class A shares, the Distributor shall use its best
efforts in all respects duly to conform with the requirements of all federal and
state laws relating to the sale of such securities. Neither the Distributor nor
any selected dealer nor any other person is authorized by the Fund to give any
information or to make any representations, other than those contained in the
Registration Statement or Prospectus and any sales literature approved by
appropriate officers of the Fund.

6.3 The Distributor shall adopt and follow procedures for the confirmation
of sales to investors and selected dealers, the collection of amounts payable by
investors and selected dealers on such sales and the cancellation of unsettled
transactions, as may be necessary to comply with the requirements of the
National Association of Securities Dealers, Inc. (NASD).

6.4 The Distributor shall have the right to enter into selected dealer
agreements with registered and qualified securities dealers and other financial
institutions of its choice for the sale of Class A shares, provided that the
Fund shall approve the forms of such agreements. Within the United States, the
Distributor shall offer and sell Class A shares only to such selected dealers as
are members in good standing of the NASD. Class A shares sold to selected
dealers shall be for resale by such dealers only at the offering price
determined as set forth in the Prospectus.

Section 7. Payments to the Distributor

The Distributor shall receive and may retain any portion of any front-end
sales charge which is imposed on sales of Class A shares and not reallocated to
selected dealers as set forth in the Prospectus, subject to the limitations of
Article III, Section 26 of the NASD Rules of Fair Practice. Payment of these
amounts to the Distributor is not contingent upon the adoption or continuation
of the Plan.

Section 8. Payment of the Distributor under the Plan

8.1 The Fund shall pay to the Distributor as compensation for services
under the Distribution and Service Plan and this Agreement a fee of .30 of 1%
(including an asset-based sales charge of .05 of 1% and a service fee of .25 of
1%) per annum

<PAGE>

of the average daily net assets of the Class A shares of the Fund.
Amounts payable under the Plan shall be accrued daily and paid
monthly or at such other intervals as Directors may determine.
Amounts payable under the Plan shall be subject to the limitations
of Article III, Section 26 of the NASD Rules of Fair Practice.

8.2 So long as the Plan or any amendment thereto is in effect, the
Distributor shall inform the Board of Directors of the commissions and account
servicing fees to be paid by the Distributor to account executives of the
Distributor and to broker-dealers and financial institutions which have dealer
agreements with the Distributor. So long as the Plan (or any amendment thereto)
is in effect, at the request of the Board of Directors or any agent or
representative of the Fund, the Distributor shall provide such additional
information as may reasonably be requested concerning the activities of the
Distributor hereunder and the costs incurred in performing such activities.

8.3 Expenses of distribution with respect to the Class A shares of the Fund
include, among others:

(a) amounts paid to Prudential Securities for performing services under a
selected dealer agreement between Prudential Securities and the
Distributor for sale of Class A shares of the Fund, including sales
commissions and trailer commissions paid to, or on account of, account
executives and indirect and overhead costs associated with
distribution activities, including central office and branch expenses;

(b) amounts paid to Prusec for performing services under a selected dealer
agreement between Prusec and the Distributor for sale of Class A
shares of the Fund, including sales commissions and trailer
commissions paid to, or on account of, agents and indirect and
overhead costs associated with distribution activities;

(c) sales commissions and trailer commissions paid to, or on account of,
broker-dealers and financial institutions (other than Prudential
Securities and Prusec) which have entered into selected dealer
agreements with the Distributor with respect to Class A shares of the
Fund.

(d) amounts paid to, or an account of, account executives of Prudential
Securities, Prusec, or of other broker-dealers or financial

<PAGE>
institutions for personal service and/or the maintenance of
shareholder accounts; and

(e) advertising for the Fund in various forms through any available
medium, including the cost of printing and mailing Fund Prospectuses,
and periodic financial reports and sales literature to persons other
than current shareholders of the Fund.

Indirect and overhead costs referred to in clauses (a) and (b) of the
foregoing sentence include (i) lease expenses, (ii) salaries and benefits of
personnel including operations and sales support personnel, (iii) utility
expenses, (iv) communications expenses, (v) sales promotion expenses, (vi)
expenses of postage, stationery and supplies and (vii) general overhead.

Section 9. Allocation of Expenses

9.1 The Fund shall bear all costs and expenses of the continuous offering
of its Class A shares, including fees and disbursements of its counsel and
auditors, in connection with the preparation and filing of any required
Registration Statements and/or Prospectuses under the Investment Company Act or
the Securities Act, and preparing and mailing annual and periodic reports and
proxy materials to shareholders (including but not limited to the expense of
setting in type any such Registration Statements, Prospectuses, annual or
periodic reports or proxy materials). The Fund shall also bear the cost of
expenses of qualification of the Class A shares for sale, and, if necessary or
advisable in connection therewith, of qualifying the Fund as a broker or dealer,
in such states of the United States or other jurisdictions as shall be selected
by the Fund and the Distributor pursuant to Section 5.4 hereof and the cost and
expense payable to each such state for continuing qualification therein until
the Fund decides to discontinue such qualification pursuant to Section 5.4
hereof. As set forth in Section 8 above, the Fund shall also bear the expenses
it assumes pursuant to the Plan with respect to Class A shares, so long as the
Plan is in effect.

Section 10. Indemnification

10.1 The Fund agrees to indemnify, defend and hold the Distributor, its
officers and directors and any person who controls the Distributor within the
meaning of Section 15 of the Securities Act, free and harmless from and against
any and all claims, demands, liabilities and expenses (including the cost of
investigating or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) which the Distributor, its officers,
directors or any such controlling person may incur under the Securities Act, or
under common law or otherwise, arising out of or based upon any untrue statement
of a

<PAGE>

material fact contained in the Registration Statement or Prospectus or arising
out of or based upon any alleged omission to state a material fact required to
be stated in either thereof or necessary to make the statements in either
thereof not misleading, except insofar as such claims, demands, liabilities or
expenses arise out of or are based upon any such untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with information furnished in writing by the Distributor to the Fund for use in
the Registration Statement or Prospectus; provided, however, that this indemnity
agreement shall not inure to the benefit of any such officer, director, trustee
or controlling person unless a court of competent jurisdiction shall determine
in a final decision on the merits, that the person to be indemnified was not
liable by reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of its reckless disregard of its
obligations under this Agreement (disabling conduct), or, in the absence of such
a decision, a reasonable determination, based upon a review of the facts, that
the indemnified person was not liable by reason of disabling conduct, by (a) a
vote of a majority of a quorum of directors or trustees who are neither
"interested persons" of the Fund as defined in Section 2(a)(19) of the
Investment Company Act nor parties to the proceeding, or (b) an independent
legal counsel in a written opinion. The Fund's agreement to indemnify the
Distributor, its officers and directors or trustees and any such controlling
person as aforesaid is expressly conditioned upon the Fund's being promptly
notified of any action brought against the Distributor, its officers or
directors or trustees, or any such controlling person, such notification to be
given by letter or telegram addressed to the Fund at its principal business
office. The Fund agrees promptly to notify the Distributor of the commencement
of any litigation or proceedings against it or any of its officers or directors
in connection with the issue and sale of any Class A shares.

10.2 The Distributor agrees to indemnify, defend and hold the Fund, its
officers and Directors and any person who controls the Fund, if any, within the
meaning of Section 15 of the Securities Act, free and harmless from and against
any and all claims, demands, liabilities and expenses (including the cost of
investigating or defending against such claims, demands or liabilities and any
counsel fees incurred in connection therewith) which the Fund, its officers and
Directors or any such controlling person may incur under the Securities Act or
under common law or otherwise, but only to the extent that such liability or
expense incurred by the Fund, its Directors or officers or such controlling
person resulting from such claims or demands shall arise out of or be based upon
any alleged untrue statement of a material fact contained in information
furnished in writing by the Distributor to the Fund for use in the Registration
Statement or Prospectus or shall arise out of or be based upon any alleged
omission to state a material fact in connection with such information required
to be

<PAGE>

stated in the Registration Statement or Prospectus or necessary to
make such information not misleading. The Distributor's agreement
to indemnify the Fund, its officers and Directors and any such
controlling person as aforesaid, is expressly conditioned upon the
Distributor's being promptly notified of any action brought against
the Fund, its officers and Directors or any such controlling
person, such notification being given to the Distributor at its
principal business office.

Section 11. Duration and Termination of this Agreement

11.1 This Agreement shall become effective as of the date first above
written and shall remain in force for two years from the date hereof and
thereafter, but only so long as such continuance is specifically approved at
least annually by (a) the Board of Directors of the Fund, or by the vote of a
majority of the outstanding voting securities of the Class A shares of the Fund,
and (b) by the vote of a majority of those Directors who are not parties to this
Agreement or interested persons of any such parties and who have no direct or
indirect financial interest in this Agreement or in the operation of the Fund's
Plan or in any agreement related thereto (Rule 12b-1 Directors), cast in person
at a meeting called for the purpose of voting upon such approval.

11.2 This Agreement may be terminated at any time, without the payment of
any penalty, by a majority of the Rule 12b-1 Directors or by vote of a majority
of the outstanding voting securities of the Class A shares of the Fund, or by
the Distributor, on sixty (60) days' written notice to the other party. This
Agreement shall automatically terminate in the event of its assignment.

11.3 The terms "affiliated person," "assignment," "interested person" and
"vote of a majority of the outstanding voting securities", when used in this
Agreement, shall have the respective meanings specified in the Investment
Company Act.

Section 12. Amendments to this Agreement

This Agreement may be amended by the parties only if such amendment is
specifically approved by (a) the Board of Directors of the Fund, or by the vote
of a majority of the outstanding voting securities of the Class A shares of the
Fund, and (b) by the vote of a majority of the Rule 12b-1 Directors cast in
person at a meeting called for the purpose of voting on such amendment.

Section 13. Governing Law

9
<PAGE>

the State of New York, or any of the provisions herein, conflict
with the applicable provisions of the Investment Company Act, the
latter shall control.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year above written.

Prudential Mutual Fund
Distributors, Inc.

By: /s/ ROBERT F. GUNIA
----------------------
Robert F. Gunia
Executive Vice President

Prudential Global Fund, Inc.

By: /s/ RICHARD A. REDEKER
-----------------------------
Richard A. Redeker
President

Exhibit 6(B)

PRUDENTIAL GLOBAL FUND, INC.
Distribution Agreement
(Class B Shares)

Agreement made as of August 1, 1994 and amended and restated as of June 5,
1995, between Prudential Global Fund, Inc. a Maryland Corporation (the Fund) and
Prudential Securities Incorporated, a Delaware Corporation (the Distributor).

WITNESSETH

WHEREAS, the Fund and the Distributor wish to enter into an agreement with
each other, with respect to the continuous offering of the Fund's Class B shares
from and after the date hereof in order to promote the growth of the Fund and
facilitate the distribution of its Class B shares; and

WHEREAS, the Fund has adopted a distribution and service plan pursuant to
Rule 12b-1 under the Investment Company Act (the Plan) authorizing payments by
the Fund to the Distributor with respect to the distribution of Class B shares
of the Fund and the maintenance of Class B shareholder accounts.

NOW, THEREFORE, the parties agree as follows:

Section 1. Appointment of the Distributor

The Fund hereby appoints the Distributor as the principal underwriter and
distributor of the Class B shares of the Fund to sell Class B shares to the
public on behalf of the Fund and the Distributor hereby accepts such appointment
and agrees to act hereunder. The Fund hereby agrees during the term of this
Agreement to sell Class B shares of the Fund through the Distributor on the
terms and conditions set forth below.

Section 2. Exclusive Nature of Duties

The Distributor shall be the exclusive representative of the Fund to act as
principal underwriter and distributor of the Fund's Class B shares, except that:

<PAGE>

2.1 The exclusive rights granted to the Distributor to sell Class B shares
of the Fund shall not apply to Class B shares of the Fund issued in connection
with the merger or consolidation of any other investment company or personal
holding company with the Fund or the acquisition by purchase or otherwise of all
(or substantially all) the assets or the outstanding shares of any such company
by the Fund.

2.2 Such exclusive rights shall not apply to Class B shares issued by the
Fund pursuant to reinvestment of dividends or capital gains distributions.

2.3 Such exclusive rights shall not apply to Class B shares issued by the
Fund pursuant to the reinstatement privilege afforded redeeming shareholders.

2.4 Such exclusive rights shall not apply to purchases made through the
Fund's transfer and dividend disbursing agent in the manner set forth in the
currently effective Prospectus of the Fund. The term "Prospectus" shall mean the
Prospectus and Statement of Additional Information included as part of the
Fund's Registration Statement, as such Prospectus and Statement of Additional
Information may be amended or supplemented from time to time, and the term
"Registration Statement" shall mean the Registration Statement filed by the Fund
with the Securities and Exchange Commission and effective under the Securities
Act of 1933, as amended (the Securities Act), and the Investment Company Act, as
such Registration Statement is amended from time to time.

Section 3. Purchase of Class B Shares from the Fund

3.1 The Distributor shall have the right to buy from the Fund on behalf of
investors the Class B shares needed, but not more than the Class B shares needed
(except for clerical errors in transmission) to fill unconditional orders for
Class B shares placed with the Distributor by investors or registered and
qualified securities dealers and other financial institutions (selected
dealers).

3.2 The Class B shares shall be sold by the Distributor on behalf of the
Fund and delivered by the Distributor or selected dealers, as described in
Section 6.4 hereof, to investors at the offering price as set forth in the
Prospectus.

3.3 The Fund shall have the right to suspend the sale of its Class B shares
at times when redemption is suspended pursuant to the conditions in Section 4.3
hereof or at such other times as may be determined by the Board of Directors.
The Fund shall also have the right to suspend the sale of its Class B shares if
a banking moratorium shall have been declared by federal or New York
authorities.

<PAGE>

3.4 The Fund, or any agent of the Fund designated in writing by the Fund,
shall be promptly advised of all purchase orders for Class B shares received by
the Distributor. Any order may be rejected by the Fund; provided, however, that
the Fund will not arbitrarily or without reasonable cause refuse to accept or
confirm orders for the purchase of Class B shares. The Fund (or its agent) will
confirm orders upon their receipt, will make appropriate book entries and upon
receipt by the Fund (or its agent) of payment therefor, will deliver deposit
receipts for such Class B shares pursuant to the instructions of the
Distributor. Payment shall be made to the Fund in New York Clearing House funds
or federal funds. The Distributor agrees to cause such payment and such
instructions to be delivered promptly to the Fund (or its agent).

Section 4. Repurchase or Redemption of Class B Shares by the Fund

4.1 Any of the outstanding Class B shares may be tendered for redemption at
any time, and the Fund agrees to repurchase or redeem the Class B shares so
tendered in accordance with its Articles of Incorporation as amended from time
to time, and in accordance with the applicable provisions of the Prospectus. The
price to be paid to redeem or repurchase the Class B shares shall be equal to
the net asset value determined as set forth in the Prospectus. All payments by
the Fund hereunder shall be made in the manner set forth in Section 4.2 below.

4.2 The Fund shall pay the total amount of the redemption price as defined
in the above paragraph pursuant to the instructions of the Distributor on or
before the seventh day subsequent to its having received the notice of
redemption in proper form. The proceeds of any redemption of Class B shares
shall be paid by the Fund as follows: (a) any applicable contingent deferred
sales charge shall be paid to the Distributor and (b) the balance shall be paid
to or for the account of the redeeming shareholder, in each case in accordance
with applicable provisions of the Prospectus.

4.3 Redemption of Class B shares or payment may be suspended at times when
the New York Stock Exchange is closed for other than customary weekends and
holidays, when trading on said Exchange is restricted, when an emergency exists
as a result of which disposal by the Fund of securities owned by it is not
reasonably practicable or it is not reasonably practicable for the Fund fairly
to determine the value of its net assets, or during any other period when the
Securities and Exchange Commission, by order, so permits.

3
<PAGE>

Section 5. Duties of the Fund

5.1 Subject to the possible suspension of the sale of Class B shares as
provided herein, the Fund agrees to sell its Class B shares so long as it has
Class B shares available.

5.2 The Fund shall furnish the Distributor copies of all information,
financial statements and other papers which the Distributor may reasonably
request for use in connection with the distribution of Class B shares, and this
shall include one certified copy, upon request by the Distributor, of all
financial statements prepared for the Fund by independent public accountants.
The Fund shall make available to the Distributor such number of copies of its
Prospectus and annual and interim reports as the Distributor shall reasonably
request.

5.3 The Fund shall take, from time to time, but subject to the necessary
approval of the Board of Directors and the shareholders, all necessary action to
fix the number of authorized Class B shares and such steps as may be necessary
to register the same under the Securities Act, to the end that there will be
available for sale such number of Class B shares as the Distributor reasonably
may expect to sell. The Fund agrees to file from time to time such amendments,
reports and other documents as may be necessary in order that there will be no
untrue statement of a material fact in the Registration Statement, or necessary
in order that there will be no omission to state a material fact in the
Registration Statement which omission would make the statements therein
misleading.

5.4 The Fund shall use its best efforts to qualify and maintain the
qualification of any appropriate number of its Class B shares for sales under
the securities laws of such states as the Distributor and the Fund may approve;
provided that the Fund shall not be required to amend its Articles of
Incorporation or By-Laws to comply with the laws of any state, to maintain an
office in any state, to change the terms of the offering of its Class B shares
in any state from the terms set forth in its Registration Statement, to qualify
as a foreign corporation in any state or to consent to service of process in any
state other than with respect to claims arising out of the offering of its Class
B shares. Any such qualification may be withheld, terminated or withdrawn by the
Fund at any time in its discretion. As provided in Section 9.1 hereof, the
expense of qualification and maintenance of qualification shall be borne by the
Fund. The Distributor shall furnish such information and other material relating
to its affairs and activities as may be required by the Fund in connection with
such qualifications.

<PAGE>

Section 6. Duties of the Distributor

6.1 The Distributor shall devote reasonable time and effort to effect sales
of Class B shares of the Fund, but shall not be obligated to sell any specific
number of Class B shares. Sales of the Class B shares shall be on the terms
described in the Prospectus. The Distributor may enter into like arrangements
with other investment companies. The Distributor shall compensate the selected
dealers as set forth in the Prospectus.

6.2 In selling the Class B shares, the Distributor shall use its best
efforts in all respects duly to conform with the requirements of all federal and
state laws relating to the sale of such securities. Neither the Distributor nor
any selected dealer nor any other person is authorized by the Fund to give any
information or to make any representations, other than those contained in the
Registration Statement or Prospectus and any sales literature approved by
appropriate officers of the Fund.

6.4 The Distributor shall have the right to enter into selected dealer
agreements with registered and qualified securities dealers and other financial
institutions of its choice for the sale of Class B shares, provided that the
Fund shall approve the forms of such agreements. Within the United States, the
Distributor shall offer and sell Class B shares only to such selected dealers as
are members in good standing of the NASD. Class B shares sold to selected
dealers shall be for resale by such dealers only at the offering price
determined as set forth in the Prospectus.

Section 7. Payments to the Distributor

The Distributor shall receive and may retain any contingent deferred sales
charge which is imposed with respect to repurchases and redemptions of Class B
shares as set forth in the Prospectus, subject to the limitations of Article
III, Section 26 of the NASD Rules of Fair Practice. Payment of these amounts to
the Distributor is not contingent upon the adoption or continuation of the Plan.

Section 8. Payment of the Distributor under the Plan

8.1 The Fund shall pay to the Distributor as compensation for services
under the Distribution and Service Plan and this Agreement a fee of .75 of 1%
per annum of the average daily net assets of the Class B shares up to the level
of average

<PAGE>

daily net assets of the Fund on February 26, 1986, plus 1% per annum of the
average daily net assets of the Class B shares of the Fund in excess of such
level (such amounts may include an asset-based sales charge of up to .75 of 1%
and a service fee of up to .25 of 1%). Amounts payable under the Plan shall be
accrued daily and paid monthly or at such other intervals as the Directors may
determine. Amounts payable under the Plan shall be subject to the limitations of
Article III, Section 26 of the NASD Rules of Fair Practice.

8.2 So long as the Plan or any amendment thereto is in effect, the
Distributor shall inform the Board of Directors of the commissions (including
trailer commissions) and account servicing fees to be paid by the Distributor to
account executives of the Distributor and to broker-dealers and financial
institutions which have selected dealer agreements with the Distributor. So long
as the Plan (or any amendment thereto) is in effect, at the request of the Board
of Directors or any agent or representative of the Fund, the Distributor shall
provide such additional information as may reasonably be requested concerning
the activities of the Distributor hereunder and the costs incurred in performing
such activities.

8.3 Expenses of distribution with respect to the Class B shares of the Fund
include, among others:

(a) sales commissions (including trailer commissions) paid to, or on
account of, account executives of the Distributor;

(b) indirect and overhead costs of the Distributor associated with
performance of distribution activities, including central office and
branch expenses;

(c) amounts paid to Prusec for performing services under a selected dealer
agreement between Prusec and the Distributor for sale of Class B
shares of the Fund, including sales commissions and trailer
commissions paid to, or on account of, agents and indirect and
overhead costs associated with distribution activities;

(d) sales commissions (including trailer commissions) paid to, or on
account of, broker-dealers and financial institutions (other than
Prusec) which have entered into selected dealer agreements with the
Distributor with respect to Class B shares of the Fund;

<PAGE>

(e) amounts paid to, or an account of, account executives of the
Distributor or of other broker-dealers or financial institutions for
personal service and/or the maintenance of shareholder accounts; and

(f) advertising for the Fund in various forms through any available
medium, including the cost of printing and mailing Fund Prospectuses,
and periodic financial reports and sales literature to persons other
than current shareholders of the Fund.

Indirect and overhead costs referred to in clauses (b) and (c) of the
foregoing sentence include (i) lease expenses, (ii) salaries and benefits of
personnel including operations and sales support personnel, (iii) utility
expenses, (iv) communications expenses, (v) sales promotion expenses, (vi)
expenses of postage, stationery and supplies and (vii) general overhead.

Section 9. Allocation of Expenses

9.1 The Fund shall bear all costs and expenses of the
continuous offering of its Class B shares, including fees and
disbursements of its counsel and auditors, in connection with the
preparation and filing of any required Registration Statements
and/or Prospectuses under the Investment Company Act or the
Securities Act, and preparing and mailing annual and periodic
reports and proxy materials to shareholders (including but not
limited to the expense of setting in type any such Registration
Statements, Prospectuses, annual or periodic reports or proxy
materials). The Fund shall also bear the cost of expenses of
qualification of the Class B shares for sale, and, if necessary or
advisable in connection therewith, of qualifying the Fund as a
broker or dealer, in such states of the United States or other
jurisdictions as shall be selected by the Fund and the Distributor
pursuant to Section 5.4 hereof and the cost and expense payable to
each such state for continuing qualification therein until the Fund
decides to discontinue such qualification pursuant to Section 5.4
hereof. As set forth in Section 8 above, the Fund shall also bear
the expenses it assumes pursuant to the Plan with respect to Class
B shares, so long as the Plan is in effect.

Section 10. Indemnification

<PAGE>

Distributor, its officers, Directors or any such controlling person may incur
under the Securities Act, or under common law or otherwise, arising out of or
based upon any untrue statement of a material fact contained in the Registration
Statement or Prospectus or arising out of or based upon any alleged omission to
state a material fact required to be stated in either thereof or necessary to
make the statements in either thereof not misleading, except insofar as such
claims, demands, liabilities or expenses arise out of or are based upon any such
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with information furnished in writing by the
Distributor to the Fund for use in the Registration Statement or Prospectus;
provided, however, that this indemnity agreement shall not inure to the benefit
of any such officer, Director or controlling person unless a court of competent
jurisdiction shall determine in a final decision on the merits, that the person
to be indemnified was not liable by reason of willful misfeasance, bad faith or
gross negligence in the performance of its duties, or by reason of its reckless
disregard of its obligations under this Agreement (disabling conduct), or, in
the absence of such a decision, a reasonable determination, based upon a review
of the facts, that the indemnified person was not liable by reason of disabling
conduct, by (a) a vote of a majority of a quorum of Directors who are neither
"interested persons" of the Fund as defined in Section 2(a)(19) of the
Investment Company Act nor parties to the proceeding, or (b) an independent
legal counsel in a written opinion. The Fund's agreement to indemnify the
Distributor, its officers and Directors and any such controlling person as
aforesaid is expressly conditioned upon the Fund's being promptly notified of
any action brought against the Distributor, its officers or Directors, or any
such controlling person, such notification to be given in writing addressed to
the Fund at its principal business office. The Fund agrees promptly to notify
the Distributor of the commencement of any litigation or proceedings against it
or any of its officers or Directors in connection with the issue and sale of any
Class B shares.

<PAGE>

shall arise out of or be based upon any alleged omission to state a material
fact in connection with such information required to be stated in the
Registration Statement or Prospectus or necessary to make such information not
misleading. The Distributor's agreement to indemnify the Fund, its officers and
Directors and any such controlling person as aforesaid, is expressly conditioned
upon the Distributor's being promptly notified of any action brought against the
Fund, its officers and Directors or any such controlling person, such
notification to be given to the Distributor in writing at its principal business
office.

Section 11. Duration and Termination of this Agreement

11.1 This Agreement shall become effective as of the date first above
written and shall remain in force for two years from the date hereof and
thereafter, but only so long as such continuance is specifically approved at
least annually by (a) the Board of Directors of the Fund, or by the vote of a
majority of the outstanding voting securities of the Class B shares of the Fund,
and (b) by the vote of a majority of those Directors who are not parties to this
Agreement or interested persons of any such parties and who have no direct or
indirect financial interest in this Agreement or in the operation of the Fund's
Plan or in any agreement related thereto (Rule 12b-1 Directors), cast in person
at a meeting called for the purpose of voting upon such approval.

11.2 This Agreement may be terminated at any time, without the payment of
any penalty, by a majority of the Rule 12b-1 Directors or by vote of a majority
of the outstanding voting securities of the Class B shares of the Fund, or by
the Distributor, on sixty (60) days' written notice to the other party. This
Agreement shall automatically terminate in the event of its assignment.

11.3 The terms "affiliated person," "assignment," "interested person" and
"vote of a majority of the outstanding voting securities," when used in this
Agreement, shall have the respective meanings specified in the Investment
Company Act.

Section 12. Amendments to this Agreement

This Agreement may be amended by the parties only if such amendment is
specifically approved by (a) the Board of Directors of the Fund, or by the vote
of a majority of the outstanding voting securities of the Class B shares of the
Fund, and (b) by the vote of a majority of the Rule 12b-1 Board of Directors
cast in person at a meeting called for the purpose of voting on such amendment.

<PAGE>

Section 13. Governing Law

The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of the State of New York as at the time in effect and
the applicable provisions of the Investment Company Act. To the extent that the
applicable law of the State of New York, or any of the provisions herein,
conflict with the applicable provisions of the Investment Company Act, the
latter shall control.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year above written.

Prudential Securities Incorporated

By: /s/ ROBERT F. GUNIA
----------------------
Robert F. Gunia
Senior Vice President

Prudential Global Fund, Inc.

By: /s/ RICHARD A. REDEKER
-----------------------------
Richard A. Redeker
President

Exhibit 6(c)

PRUDENTIAL GLOBAL FUND, INC.
Distribution Agreement
(Class C Shares)

WITNESSETH

WHEREAS, the Fund and the Distributor wish to enter into an agreement with
each other, with respect to the continuous offering of the Fund's Class C shares
from and after the date hereof in order to promote the growth of the Fund and
facilitate the distribution of its Class C shares; and

WHEREAS, the Fund has adopted a distribution and service plan pursuant to
Rule 12b-1 under the Investment Company Act (the Plan) authorizing payments by
the Fund to the Distributor with respect to the distribution of Class C shares
of the Fund and the maintenance of Class C shareholder accounts.

NOW, THEREFORE, the parties agree as follows:

Section 1. Appointment of the Distributor

The Fund hereby appoints the Distributor as the principal underwriter and
distributor of the Class C shares of the Fund to sell Class C shares to the
public on behalf of the Fund and the Distributor hereby accepts such appointment
and agrees to act hereunder. The Fund hereby agrees during the term of this
Agreement to sell Class C shares of the Fund through the Distributor on the
terms and conditions set forth below.

Section 2. Exclusive Nature of Duties

The Distributor shall be the exclusive representative of the Fund to act as
principal underwriter and distributor of the Fund's Class C shares, except that:

<PAGE>

2.1 The exclusive rights granted to the Distributor to sell Class C shares
of the Fund shall not apply to Class C shares of the Fund issued in connection
with the merger or consolidation of any other investment company or personal
holding company with the Fund or the acquisition by purchase or otherwise of all
(or substantially all) the assets or the outstanding shares of any such company
by the Fund.

2.2 Such exclusive rights shall not apply to Class C shares issued by the
Fund pursuant to reinvestment of dividends or capital gains distributions.

2.3 Such exclusive rights shall not apply to Class C shares issued by the
Fund pursuant to the reinstatement privilege afforded redeeming shareholders.

2.4 Such exclusive rights shall not apply to purchases made through the
Fund's transfer and dividend disbursing agent in the manner set forth in the
currently effective Prospectus of the Fund. The term "Prospectus" shall mean the
Prospectus and Statement of Additional Information included as part of the
Fund's Registration Statement, as such Prospectus and Statement of Additional
Information may be amended or supplemented from time to time, and the term
"Registration Statement" shall mean the Registration Statement filed by the Fund
with the Securities and Exchange Commission and effective under the Securities
Act of 1933, as amended (the Securities Act), and the Investment Company Act, as
such Registration Statement is amended from time to time.

Section 3. Purchase of Class C Shares from the Fund

3.1 The Distributor shall have the right to buy from the Fund on behalf of
investors the Class C shares needed, but not more than the Class C shares needed
(except for clerical errors in transmission) to fill unconditional orders for
Class C shares placed with the Distributor by investors or registered and
qualified securities dealers and other financial institutions (selected
dealers).

3.2 The Class C shares shall be sold by the Distributor on behalf of the
Fund and delivered by the Distributor or selected dealers, as described in
Section 6.4 hereof, to investors at the offering price as set forth in the
Prospectus.

3.3 The Fund shall have the right to suspend the sale of its Class C shares
at times when redemption is suspended pursuant to the conditions in Section 4.3
hereof or at such other times as may be determined by the Board of Directors.
The Fund shall also have the right to suspend the sale of its Class C shares if
a banking moratorium shall have been declared by federal or New York
authorities.

<PAGE>

3.4 The Fund, or any agent of the Fund designated in writing by the Fund,
shall be promptly advised of all purchase orders for Class C shares received by
the Distributor. Any order may be rejected by the Fund; provided, however, that
the Fund will not arbitrarily or without reasonable cause refuse to accept or
confirm orders for the purchase of Class C shares. The Fund (or its agent) will
confirm orders upon their receipt, will make appropriate book entries and upon
receipt by the Fund (or its agent) of payment therefor, will deliver deposit
receipts for such Class C shares pursuant to the instructions of the
Distributor. Payment shall be made to the Fund in New York Clearing House funds
or federal funds. The Distributor agrees to cause such payment and such
instructions to be delivered promptly to the Fund (or its agent).

Section 4. Repurchase or Redemption of Class C Shares by the Fund

4.1 Any of the outstanding Class C shares may be tendered for redemption at
any time, and the Fund agrees to repurchase or redeem the Class C shares so
tendered in accordance with its Articles of Incorporation as amended from time
to time, and in accordance with the applicable provisions of the Prospectus. The
price to be paid to redeem or repurchase the Class C shares shall be equal to
the net asset value determined as set forth in the Prospectus. All payments by
the Fund hereunder shall be made in the manner set forth in Section 4.2 below.

4.2 The Fund shall pay the total amount of the redemption price as defined
in the above paragraph pursuant to the instructions of the Distributor on or
before the seventh day subsequent to its having received the notice of
redemption in proper form. The proceeds of any redemption of Class C shares
shall be paid by the Fund as follows: (a) any applicable contingent deferred
sales charge shall be paid to the Distributor and (b) the balance shall be paid
to or for the account of the redeeming shareholder, in each case in accordance
with applicable provisions of the Prospectus.

4.3 Redemption of Class C shares or payment may be suspended at times when
the New York Stock Exchange is closed for other than customary weekends and
holidays, when trading on said Exchange is restricted, when an emergency exists
as a result of which disposal by the Fund of securities owned by it is not
reasonably practicable or it is not reasonably practicable for the Fund fairly
to determine the value of its net assets, or during any other period when the
Securities and Exchange Commission, by order, so permits.

<PAGE>

Section 5. Duties of the Fund

5.1 Subject to the possible suspension of the sale of Class C shares as
provided herein, the Fund agrees to sell its Class C shares so long as it has
Class C shares available.

5.2 The Fund shall furnish the Distributor copies of all information,
financial statements and other papers which the Distributor may reasonably
request for use in connection with the distribution of Class C shares, and this
shall include one certified copy, upon request by the Distributor, of all
financial statements prepared for the Fund by independent public accountants.
The Fund shall make available to the Distributor such number of copies of its
Prospectus and annual and interim reports as the Distributor shall reasonably
request.

5.3 The Fund shall take, from time to time, but subject to the necessary
approval of the Board of Directors and the shareholders, all necessary action to
fix the number of authorized Class C shares and such steps as may be necessary
to register the same under the Securities Act, to the end that there will be
available for sale such number of Class C shares as the Distributor reasonably
may expect to sell. The Fund agrees to file from time to time such amendments,
reports and other documents as may be necessary in order that there will be no
untrue statement of a material fact in the Registration Statement, or necessary
in order that there will be no omission to state a material fact in the
Registration Statement which omission would make the statements therein
misleading.

5.4 The Fund shall use its best efforts to qualify and maintain the
qualification of any appropriate number of its Class C shares for sales under
the securities laws of such states as the Distributor and the Fund may approve;
provided that the Fund shall not be required to amend its Articles of
Incorporation or By-Laws to comply with the laws of any state, to maintain an
office in any state, to change the terms of the offering of its Class C shares
in any state from the terms set forth in its Registration Statement, to qualify
as a foreign corporation in any state or to consent to service of process in any
state other than with respect to claims arising out of the offering of its Class
C shares. Any such qualification may be withheld, terminated or withdrawn by the
Fund at any time in its discretion. As provided in Section 9.1 hereof, the
expense of qualification and maintenance of qualification shall be borne by the
Fund. The Distributor shall furnish such information and other material relating
to its affairs and activities as may be required by the Fund in connection with
such qualifications.

<PAGE>

Section 6. Duties of the Distributor

6.1 The Distributor shall devote reasonable time and effort to effect sales
of Class C shares of the Fund, but shall not be obligated to sell any specific
number of Class C shares. Sales of the Class C shares shall be on the terms
described in the Prospectus. The Distributor may enter into like arrangements
with other investment companies. The Distributor shall compensate the selected
dealers as set forth in the Prospectus.

6.2 In selling the Class C shares, the Distributor shall use its best
efforts in all respects duly to conform with the requirements of all federal and
state laws relating to the sale of such securities. Neither the Distributor nor
any selected dealer nor any other person is authorized by the Fund to give any
information or to make any representations, other than those contained in the
Registration Statement or Prospectus and any sales literature approved by
appropriate officers of the Fund.

6.4 The Distributor shall have the right to enter into selected dealer
agreements with registered and qualified securities dealers and other financial
institutions of its choice for the sale of Class C shares, provided that the
Fund shall approve the forms of such agreements. Within the United States, the
Distributor shall offer and sell Class C shares only to such selected dealers as
are members in good standing of the NASD. Class C shares sold to selected
dealers shall be for resale by such dealers only at the offering price
determined as set forth in the Prospectus.

Section 7. Payments to the Distributor

The Distributor shall receive and may retain any contingent deferred sales
charge which is imposed with respect to repurchases and redemptions of Class C
shares as set forth in the Prospectus, subject to the limitations of Article
III, Section 26 of the NASD Rules of Fair Practice. Payment of these amounts to
the Distributor is not contingent upon the adoption or continuation of the Plan.

Section 8. Payment of the Distributor under the Plan

8.1 The Fund shall pay to the Distributor as compensation for services
under the Distribution and Service Plan and this Agreement a fee of 1%
(including an asset-based sales charge of .75 of 1% and a service fee of .25 of
1%) per annum of

<PAGE>

the average daily net assets of the Class C shares of the Fund. Amounts payable
under the Plan shall be accrued daily and paid monthly or at such other
intervals as Directors/Trustees may determine. Amounts payable under the Plan
shall be subject to the limitations of Article III, Section 26 of the NASD Rules
of Fair Practice.

8.3 Expenses of distribution with respect to the Class C shares of the Fund
include, among others:

(a) sales commissions (including trailer commissions) paid to, or on
account of, account executives of the Distributor;

(b) indirect and overhead costs of the Distributor associated with
performance of distribution activities, including central office and
branch expenses;

(c) amounts paid to Prusec for performing services under a selected dealer
agreement between Prusec and the Distributor for sale of Class C
shares of the Fund, including sales commissions and trailer
commissions paid to, or on account of, agents and indirect and
overhead costs associated with distribution activities;

(e) amounts paid to, or an account of, account executives of the
Distributor or of other broker-dealers or financial institutions for

<PAGE>

personal service and/or the maintenance of shareholder accounts; and

Section 9. Allocation of Expenses

9.1 The Fund shall bear all costs and expenses of the continuous offering
of its Class C shares, including fees and disbursements of its counsel and
auditors, in connection with the preparation and filing of any required
Registration Statements and/or Prospectuses under the Investment Company Act or
the Securities Act, and preparing and mailing annual and periodic reports and
proxy materials to shareholders (including but not limited to the expense of
setting in type any such Registration Statements, Prospectuses, annual or
periodic reports or proxy materials). The Fund shall also bear the cost of
expenses of qualification of the Class C shares for sale, and, if necessary or
advisable in connection therewith, of qualifying the Fund as a broker or dealer,
in such states of the United States or other jurisdictions as shall be selected
by the Fund and the Distributor pursuant to Section 5.4 hereof and the cost and
expense payable to each such state for continuing qualification therein until
the Fund decides to discontinue such qualification pursuant to Section 5.4
hereof. As set forth in Section 8 above, the Fund shall also bear the expenses
it assumes pursuant to the Plan with respect to Class C shares, so long as the
Plan is in effect.

Section 10. Indemnification

10.1 The Fund agrees to indemnify, defend and hold the Distributor, its
officers and Directors and any person who controls the Distributor within the
meaning of Section 15 of the Securities Act, free and harmless from and against
any and all claims, demands, liabilities and expenses (including the cost of
investigating or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) which the Distributor, its officers,
Directors or any such controlling person may incur under the Securities Act, or
under common law or otherwise, arising out of or based upon any untrue statement
of a

<PAGE>

material fact contained in the Registration Statement or Prospectus or arising
out of or based upon any alleged omission to state a material fact required to
be stated in either thereof or necessary to make the statements in either
thereof not misleading, except insofar as such claims, demands, liabilities or
expenses arise out of or are based upon any such untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with information furnished in writing by the Distributor to the Fund for use in
the Registration Statement or Prospectus; provided, however, that this indemnity
agreement shall not inure to the benefit of any such officer, Director or
controlling person unless a court of competent jurisdiction shall determine in a
final decision on the merits, that the person to be indemnified was not liable
by reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of its reckless disregard of its
obligations under this Agreement (disabling conduct), or, in the absence of such
a decision, a reasonable determination, based upon a review of the facts, that
the indemnified person was not liable by reason of disabling conduct, by (a) a
vote of a majority of a quorum of Directors who are neither "interested persons"
of the Fund as defined in Section 2(a)(19) of the Investment Company Act nor
parties to the proceeding, or (b) an independent legal counsel in a written
opinion. The Fund's agreement to indemnify the Distributor, its officers and
Directors and any such controlling person as aforesaid is expressly conditioned
upon the Fund's being promptly notified of any action brought against the
Distributor, its officers or Directors, or any such controlling person, such
notification to be given in writing addressed to the Fund at its principal
business office. The Fund agrees promptly to notify the Distributor of the
commencement of any litigation or proceedings against it or any of its officers
or Directors in connection with the issue and sale of any Class C shares.

<PAGE>

make such information not misleading. The Distributor's agreement to indemnify
the Fund, its officers and Directors and any such controlling person as
aforesaid, is expressly conditioned upon the Distributor's being promptly
notified of any action brought against the Fund, its officers and Directors or
any such controlling person, such notification to be given to the Distributor in
writing at its principal business office.

Section 11. Duration and Termination of this Agreement

11.1 This Agreement shall become effective as of the date first above
written and shall remain in force for two years from the date hereof and
thereafter, but only so long as such continuance is specifically approved at
least annually by (a) the Board of Directors of the Fund, or by the vote of a
majority of the outstanding voting securities of the Class C shares of the Fund,
and (b) by the vote of a majority of those Directors who are not parties to this
Agreement or interested persons of any such parties and who have no direct or
indirect financial interest in this Agreement or in the operation of the Fund's
Plan or in any agreement related thereto (Rule 12b-1 Directors), cast in person
at a meeting called for the purpose of voting upon such approval.

11.2 This Agreement may be terminated at any time, without the payment of
any penalty, by a majority of the Rule 12b-1 Directors or by vote of a majority
of the outstanding voting securities of the Class C shares of the Fund, or by
the Distributor, on sixty (60) days' written notice to the other party. This
Agreement shall automatically terminate in the event of its assignment.

Section 12. Amendments to this Agreement

This Agreement may be amended by the parties only if such amendment is
specifically approved by (a) the Board of Directors of the Fund, or by the vote
of a majority of the outstanding voting securities of the Class C shares of the
Fund, and (b) by the vote of a majority of the Rule 12b-1 Board of Directors
cast in person at a meeting called for the purpose of voting on such amendment.

Section 13. Governing Law

<PAGE>

with the applicable provisions of the Investment Company Act, the latter shall
control.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year above written.

Prudential Securities Incorporated

By: /s/ ROBERT F. GUNIA
----------------------
Robert F. Gunia
Senior Vice President

Prudential Global Fund, Inc.

By: /s/ RICHARD A. REDEKER
-----------------------------
Richard A. Redeker
President

Exhibit 6(d)

[FUND NAME]

Form of
Distribution Agreement
(Class Z Shares)

Agreement made as of _______, 1995, between [FUND NAME], a Maryland
Corporation/Massachusetts business trust (the Fund) and Prudential Securities
Incorporated, a Delaware Corporation (the Distributor).

WITNESSETH

WHEREAS, the Fund is registered under the Investment Company Act of 1940,
as amended (the Investment Company Act), as a [diversified/non-diversified],
open-end, management investment company and it is in the interest of the Fund to
offer its Class Z shares for sale continuously;

WHEREAS, the Fund and the Distributor wish to enter into an agreement with
each other, with respect to the continuous offering of the Fund's Class Z shares
from and after the date hereof in order to promote the growth of the Fund and
facilitate the distribution of its Class Z shares.

NOW, THEREFORE, the parties agree as follows:

Section 1. Appointment of the Distributor

The Fund hereby appoints the Distributor as the principal underwriter and
distributor of the Class Z shares of the Fund to sell Class Z shares to the
public on behalf of the Fund and the Distributor hereby accepts such appointment
and agrees to act hereunder. The Fund hereby agrees during the term of this
Agreement to sell Class Z shares of the Fund through the Distributor on the
terms and conditions set forth below.

Section 2. Exclusive Nature of Duties

The Distributor shall be the exclusive representative of the Fund to act as
principal underwriter and distributor of the Fund's Class Z shares, except that:

2.1 The exclusive rights granted to the Distributor to sell Class Z shares
of the Fund shall not apply to Class Z shares of the Fund issued in connection
with the merger or consolidation of any other investment company or personal
holding company with the Fund or the acquisition by purchase or otherwise of all
(or substantially all) of the assets or the outstanding shares of any such
company by the Fund.

<PAGE>

2.2 Such exclusive rights shall not apply to Class Z shares issued by the
Fund pursuant to reinvestment of dividends or capital gains distributions.

2.3 Such exclusive rights shall not apply to Class Z shares issued by the
Fund pursuant to the reinstatement privilege afforded redeeming shareholders.

2.4 Such exclusive rights shall not apply to purchases made through the
Fund's transfer and dividend disbursing agent in the manner set forth in the
currently effective Prospectus of the Fund. The term "Prospectus" shall mean the
Prospectus and Statement of Additional Information included as part of the
Fund's Registration Statement, as such Prospectus and Statement of Additional
Information may be amended or supplemented from time to time, and the term
"Registration Statement" shall mean the Registration Statement filed by the Fund
with the Securities and Exchange Commission and effective under the Securities
Act of 1933, as amended (the Securities Act), and the Investment Company Act, as
such Registration Statement is amended from time to time.

Section 3. Purchase of Class Z Shares from the Fund

3.1 The Distributor shall have the right to buy from the Fund on behalf of
investors the Class Z shares needed, but not more than the Class Z shares needed
(except for clerical errors in transmission) to fill unconditional orders for
Class Z shares placed with the Distributor by investors or registered and
qualified securities dealers and other financial institutions (selected
dealers).

3.2 The Class Z shares shall be sold by the Distributor on behalf of the
Fund and delivered by the Distributor or selected dealers, as described in
Section 6.4 hereof, to investors at the offering price as set forth in the
Prospectus.

3.3 The Fund shall have the right to suspend the sale of its Class Z shares
at times when redemption is suspended pursuant to the conditions in Section 4.3
hereof or at such other times as may be determined by the Board of
Directors/Trustees. The Fund shall also have the right to suspend the sale of
its Class Z shares if a banking moratorium shall have been declared by federal
or New York authorities.

3.4 The Fund, or any agent of the Fund designated in writing by the Fund,
shall be promptly advised of all purchase orders for Class Z shares received by
the Distributor. Any order may be rejected by the Fund; provided, however, that
the Fund will not arbitrarily or without reasonable cause refuse to accept or
confirm orders for the purchase of Class Z shares. The Fund (or its agent) will
confirm orders upon their receipt, will make appropriate book entries and upon
receipt by the Fund (or its

2
<PAGE>

agent) of payment therefor, will deliver deposit receipts for such Class Z
shares pursuant to the instructions of the Distributor. Payment shall be made to
the Fund in New York Clearing House funds or federal funds. The Distributor
agrees to cause such payment and such instructions to be delivered promptly to
the Fund (or its agent).

Section 4. Repurchase or Redemption of Class Z Shares by the Fund

4.1 Any of the outstanding Class Z shares may be tendered for redemption at
any time, and the Fund agrees to repurchase or redeem the Class Z shares so
tendered in accordance with its Articles of Incorporation/Declaration of Trust
as amended from time to time, and in accordance with the applicable provisions
of the Prospectus. The price to be paid to redeem or repurchase the Class Z
shares shall be equal to the net asset value determined as set forth in the
Prospectus. All payments by the Fund hereunder shall be made in the manner set
forth in Section 4.2 below.

4.2 The Fund shall pay the total amount of the redemption price as defined
in the above paragraph pursuant to the instructions of the Distributor on or
before the seventh day subsequent to its having received the notice of
redemption in proper form. The proceeds of any redemption of Class Z shares
shall be paid by the Fund to or for the account of the redeeming shareholder, in
each case in accordance with applicable provisions of the Prospectus.

4.3 Redemption of Class Z shares or payment may be suspended at times when
the New York Stock Exchange is closed for other than customary weekends and
holidays, when trading on said Exchange is restricted, when an emergency exists
as a result of which disposal by the Fund of securities owned by it is not
reasonably practicable or it is not reasonably practicable for the Fund fairly
to determine the value of its net assets, or during any other period when the
Securities and Exchange Commission, by order, so permits.

Section 5. Duties of the Fund

5.1 Subject to the possible suspension of the sale of Class Z shares as
provided herein, the Fund agrees to sell its Class Z shares so long as it has
Class Z shares available.

5.2 The Fund shall furnish the Distributor copies of all information,
financial statements and other papers which the Distributor may reasonably
request for use in connection with the distribution of Class Z shares, and this
shall include one certified copy, upon request by the Distributor, of all
financial statements examined for the Fund by independent public accountants.
The Fund shall make available to the Distributor such number of copies of its
Prospectus and annual and interim reports as the

<PAGE>

Distributor shall reasonably request.

5.3 The Fund shall take, from time to time, but subject to the necessary
approval of the Board of Directors/Trustees and the shareholders, all necessary
action to fix the number of authorized Class Z shares and such steps as may be
necessary to register the same under the Securities Act, to the end that there
will be available for sale such number of Class Z shares as the Distributor
reasonably may expect to sell. The Fund agrees to file from time to time such
amendments, reports and other documents as may be necessary in order that there
will be no untrue statement of a material fact in the Registration Statement, or
necessary in order that there will be no omission to state a material fact in
the Registration Statement which omission would make the statements therein
misleading.

5.4 The Fund shall use its best efforts to qualify and maintain the
qualification of any appropriate number of its Class Z shares for sales under
the securities laws of such states as the Distributor and the Fund may approve;
provided that the Fund shall not be required to amend its [Articles of
Incorporation/Declaration of Trust] or By-Laws to comply with the laws of any
state, to maintain an office in any state, to change the terms of the offering
of its Class Z shares in any state from the terms set forth in its Registration
Statement, to qualify as a foreign corporation in any state or to consent to
service of process in any state other than with respect to claims arising out of
the offering of its Class Z shares. Any such qualification may be withheld,
terminated or withdrawn by the Fund at any time in its discretion. As provided
in Section 7.1 hereof, the expense of qualification and maintenance of
qualification shall be borne by the Fund. The Distributor shall furnish such
information and other material relating to its affairs and activities as may be
required by the Fund in connection with such qualifications.

Section 6. Duties of the Distributor

6.1 The Distributor shall devote reasonable time and effort to effect sales
of Class Z shares of the Fund, but shall not be obligated to sell any specific
number of Class Z shares. Sales of the Class Z shares shall be on the terms
described in the Prospectus. The Distributor may enter into like arrangements
with other investment companies. The Distributor shall compensate the selected
dealers as set forth in the Prospectus.

6.2 In selling the Class Z shares, the Distributor shall use its best
efforts in all respects duly to conform with the requirements of all federal and
state laws relating to the sale of such securities. Neither the Distributor nor
any selected dealer nor any other person is authorized by the Fund to give any
information or to make any representations, other than those contained in the
Registration Statement or Prospectus and any sales

<PAGE>

literature approved by appropriate officers of the Fund.

6.4 The Distributor shall have the right to enter into selected dealer
agreements with registered and qualified securities dealers and other financial
institutions of its choice for the sale of Class Z shares, provided that the
Fund shall approve the forms of such agreements. Within the United States, the
Distributor shall offer and sell Class Z shares only to such selected dealers as
are members in good standing of the NASD. Class Z shares sold to selected
dealers shall be for resale by such dealers only at the offering price
determined as set forth in the Prospectus.

Section 7. Allocation of Expenses

7.1 The Fund shall bear all costs and expenses of the continuous offering
of its Class Z shares, including fees and disbursements of its counsel and
auditors, in connection with the preparation and filing of any required
Registration Statements and/or Prospectuses under the Investment Company Act or
the Securities Act, and preparing and mailing annual and periodic reports and
proxy materials to shareholders (including but not limited to the expense of
setting in type any such Registration Statements, Prospectuses, annual or
periodic reports or proxy materials). The Fund shall also bear the cost of and
expense of qualification of the Class Z shares for sale, and, if necessary or
advisable in connection therewith, of qualifying the Fund as a broker or dealer,
in such states of the United States or other jurisdictions as shall be selected
by the Fund and the Distributor pursuant to Section 5.4 hereof and the cost and
expense payable to each such state for continuing qualification therein until
the Fund decides to discontinue such qualification pursuant to Section 5.4
hereof.

Section 8. Indemnification

8.1 The Fund agrees to indemnify, defend and hold the Distributor, its
officers and Directors and any person who controls the Distributor within the
meaning of Section 15 of the Securities Act, free and harmless from and against
any and all claims, demands, liabilities and expenses (including the cost of
investigating or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) which the Distributor, its officers,
Directors or any such controlling person may incur under the Securities Act, or
under common law or otherwise, arising out of or based upon any untrue statement
of a

<PAGE>

material fact contained in the Registration Statement or Prospectus or arising
out of or based upon any alleged omission to state a material fact required to
be stated in either thereof or necessary to make the statements in either
thereof not misleading, except insofar as such claims, demands, liabilities or
expenses arise out of or are based upon any such untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with information furnished in writing by the Distributor to the Fund for use in
the Registration Statement or Prospectus; provided, however, that this indemnity
agreement shall not inure to the benefit of any such officer, Director or
controlling person unless a court of competent jurisdiction shall determine in a
final decision on the merits, that the person to be indemnified was not liable
by reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of its reckless disregard of its
obligations under this Agreement (disabling conduct), or, in the absence of such
a decision, a reasonable determination, based upon a review of the facts, that
the indemnified person was not liable by reason of disabling conduct, by (a) a
vote of a majority of a quorum of Directors who are neither "interested persons"
of the Fund as defined in Section 2(a)(19) of the Investment Company Act nor
parties to the proceeding, or (b) an independent legal counsel in a written
opinion. The Fund's agreement to indemnify the Distributor, its officers and
Directors and any such controlling person as aforesaid is expressly conditioned
upon the Fund's being promptly notified of any action brought against the
Distributor, its officers or Directors, or any such controlling person, such
notification to be given in writing addressed to the Fund at its principal
business office. The Fund agrees promptly to notify the Distributor of the
commencement of any litigation or proceedings against it or any of its officers
or Directors in connection with the issue and sale of any Class Z shares.

8.2 The Distributor agrees to indemnify, defend and hold the Fund, its
officers and Directors/Trustees and any person who controls the Fund, if any,
within the meaning of Section 15 of the Securities Act, free and harmless from
and against any and all claims, demands, liabilities and expenses (including the
cost of investigating or defending against such claims, demands or liabilities
and any counsel fees incurred in connection therewith) which the Fund, its
officers and Directors/Trustees or any such controlling person may incur under
the Securities Act or under common law or otherwise, but only to the extent that
such liability or expense incurred by the Fund, its Directors/Trustees or
officers or such controlling person resulting from such claims or demands shall
arise out of or be based upon any alleged untrue statement of a material fact
contained in information furnished in writing by the Distributor to the Fund for
use in the Registration Statement or Prospectus or shall arise out of or be
based upon any alleged omission to state a material fact in connection with such
information required to be stated in the Registration Statement or

<PAGE>

Prospectus or necessary to make such information not misleading. The
Distributor's agreement to indemnify the Fund, its officers and
Directors/Trustees and any such controlling person as aforesaid, is expressly
conditioned upon the Distributor's being promptly notified of any action brought
against the Fund, its officers and Directors/Trustees or any such controlling
person, such notification to be given to the Distributor in writing at its
principal business office.

Section 9. Duration and Termination of this Agreement

9.1 This Agreement shall become effective as of the date first above
written and shall remain in force for two years from the date hereof and
thereafter, but only so long as such continuance is specifically approved at
least annually by (a) the Board of Directors/Trustees of the Fund, or by the
vote of a majority of the outstanding voting securities of the Class Z shares of
the Fund and (b) by the vote of a majority of those Directors/Trustees who are
not parties to this Agreement or interested persons of any such parties and who
have no direct or indirect financial interest in this Agreement.

9.2 This Agreement may be terminated at any time, without the payment of
any penalty, by a majority of the Rule 12b-1 Directors/Trustees or by vote of a
majority of the outstanding voting securities of the Class Z shares of the Fund,
or by the Distributor, on sixty (60) days' written notice to the other party.
This Agreement shall automatically terminate in the event of its assignment.

9.3 The terms "affiliated person," "assignment," "interested person" and
"vote of a majority of the outstanding voting securities," when used in this
Agreement, shall have the respective meanings specified in the Investment
Company Act.

Section 10. Amendments to this Agreement

This Agreement may be amended by the parties only if such amendment is
specifically approved by the Board of Directors/Trustees of the Fund, or by the
vote of a majority of the outstanding voting securities of the Class Z shares of
the Fund.

Section 11. Governing Law

<PAGE>

[Section 11. Liabilities of the Fund

The name ________________________ is the designation of the Trustees under
a Declaration of Trust, dated ________, 19__, as thereafter amended, and all
persons dealing with the Fund must look solely to the property of the Fund for
the enforcement of any claims against the Fund as neither the Trustees,
officers, agents or shareholders assume any personal liability for obligations
entered into on behalf of the Fund.]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year above written.

Prudential Securities
Incorporated

By:_____________________________
Robert F. Gunia
Senior Vice President

[FUND NAME]

By:_____________________________
Richard A. Redeker
President

[18f3]cld-mod.agr

Exhibit 8(b)

NEW ENTRY

FORM OF
AMENDMENT TO CUSTODIAN CONTRACT

Agreement made by and between State Street Bank and Trust Company (the
"Custodian") and (the "Fund").

WHEREAS, the Custodian and the Fund are parties to a custodian contract
dated ______________ (the "Custodian Contract") governing the terms and
conditions under which the Custodian maintains custody of the securities and
other assets of the Fund; and

WHEREAS, the Custodian and the Fund desire to amend the terms and
conditions under which the Custodian maintains the Fund's securities and other
non-cash property in the custody of certain foreign sub-custodians in conformity
with the requirements of Rule 17f-5 under the Investment Company Act of 1940, as
amended;

NOW THEREFORE, in consideration of the premises and covenants contained
herein, the Custodian and the Fund hereby amend the Custodian Contract by the
addition of the following terms and provisions;

1. Notwithstanding any provisions to the contrary set forth in the
Custodian Contract, the Custodian may hold securities and other non-cash
property for all of its customers, including the Fund, with a foreign
sub-custodian in a single account that is identified as belonging to the
Custodian for the benefit of its customers, provided however, that (i) the
records of the Custodian with respect to securities and other non-cash property
of the Fund which are maintained in such account shall identify by book-entry
those securities and other non-cash property belonging to the Fund and (ii) the
Custodian shall require that securities and other non-cash property so held by
the foreign sub-custodian be held separately from any assets of the foreign
sub-custodian or of others.

2. Except as specifically superseded or modified herein, the terms and
provisions of the Custodian Contract shall continue to apply with full force and
effect.

IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed as a sealed instrument in its name and behalf by its duly authorized
representative this ____ day of __________, 1995.

By:________________________________

Title:_____________________________

STATE STREET BANK AND TRUST COMPANY

By:________________________________

Title:_____________________________

CONSENT OF INDEPENDENT AUDITORS

We consent to the use in Post-Effective Amendment No. 18 to Registration
Statement No. 2-89725 of Prudential Global Fund, Inc. of our report dated
December 16, 1994, appearing in the Statement of Additional Information, which
is a part of such Registration Statement, and to the references to us under
the headings "Financial Highlights" in the Prospectus, which is a part of such
Registration Statement, and "Custodian, Transfer and Dividend Disbursing Agent
and Independent Accountants" in the Statement of Additional Information.

/s/ Deloitte & Touche LLP

Deloitte & Touche LLP
New York, New York
October 31, 1995

PRUDENTIAL GLOBAL FUND ,INC.
(the Fund)

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. Any material
amendment to this plan is subject to prior approval of the Board of Directors,
including a majority of the independent Directors.

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 by
1% each year) which will be imposed on certain
redemptions and a Rule 12b-1 fee of 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 are not subject to an initial
sales charge but are subject to a low
contingent deferred sales charge (declining by
1% each year) 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.

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, will be allocated to each class on the
basis of the net asset value of that class in relation to the net asset
value of the Fund.

<PAGE>

DIVIDENDS AND DISTRIBUTIONS

Dividends and other distributions paid by the Fund 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 may be different from that paid by another
class because of Rule 12b-1 fees and other expenses borne exclusively by
that class.

EXCHANGE PRIVILEGE

Each class of shares is generally exchangeable for the same class of shares
(or the class of shares with similar characteristics), if any, of the other
Prudential Mutual Funds (subject to certain minimum investment
requirements) at relative net asset value without the imposition of any
sales charge.

Class B and Class C shares (which are not subject to a contingent deferred
sales charge) of shareholders who qualify to purchase Class A shares at net
asset value will be automatically exchanged for Class A shares on a
quarterly basis, unless the shareholder elects otherwise.

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 Directors, pursuant to their fiduciary
responsibilities 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 Directors, including a majority of the independent
Directors, shall take such action as is reasonably necessary to eliminate
any such conflicts that may develop. Prudential Mutual Fund Management,
Inc., the Fund's Manager, will be responsible for reporting any potential
or existing conflicts to the Directors.

<PAGE>

C. For purposes of expressing an opinion on the financial statements 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.

Dated: September 28, 1995

[18f-3]18f3-NMF.pln

<ARTICLE> 6
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<NAME> PRUDENTIAL GLOBAL FUND
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<NUMBER> 001
<NAME> PRUDENTIAL GLOBAL FUND (CLASS A)

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<NAME> PRUDENTIAL GLOBAL FUND
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</TABLE>

<ARTICLE> 6
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<NAME> PRUDENTIAL GLOBAL FUND
<SERIES>
<NUMBER> 003
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</TABLE>