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National Money Market Fund
(the "Fund")
a Series of
Cash Accumulation Trust
(the "Trust")
Supplement dated December 12, 1997 to
Prospectus dated February 1, 1997
On December 11, 1997, shareholders elected new Trustees and approved the
appointment of Prudential Investments Fund Management LLC (PIFM), Gateway Center
Three, 100 Mulberry Street, Newark, New Jersey 07102-4077, as manager of the
Fund and The Prudential Investment Corporation (PIC), also located at Gateway
Center Three, 100 Mulberry Street, Newark, New Jersey 07102-4077, as subadviser
to the Fund.
PIFM is organized in New York as a limited liability company. As of December
12, 1997, PIFM serves as the manager to 41 open-end investment companies,
constituting all of Prudential Mutual Funds, and as manager or administrator to
22 closed-end investment companies with aggregate assets of approximately
$60 billion.
PIFM and PIC are wholly-owned subsidiaries of The Prudential Insurance
Company of America, a major diversified insurance and financial services
company.
PIFM will receive a monthly fee as manager of the Fund pursuant to a
Management Agreement between the Trust and PIFM based upon the following annual
rates: 0.390% of the first $1 billion of net assets; 0.375% of the next $500
million of net assets; 0.350% of the next $500 million of net assets; and 0.325%
of net assets in excess of $2 billion. Under a Subadvisory Agreement between
PIFM and PIC, PIC furnishes investment advisory services in connection with the
management of the Fund and is reimbursed by PIFM for its reasonable costs and
expenses incurred in providing such services. Under the Management Agreement
between the Trust and PIFM, PIFM continues to have responsibility for all
investment advisory service and supervises PIC's performance of such
services. Until Liquid Assets Fund, another series of the Trust, is available as
an investment for certain accounts that are subject to fiduciary and prohibited
transaction requirements imposed by the Employee Retirement Income Securities
Act of 1974 (ERISA), which is expected to occur on or about December 22, 1997,
all fees of PIFM and PIC will be waived.
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On December 12, 1997, the Board of Trustees approved a new Distributor,
Custodian, and Transfer Agent for the Trust.
Prudential Securities Incorporated (PSI), One Seaport Plaza, New York, New
York 10292, begins serving as the Trust's Distributor on December 12, 1997.
PSI is an indirect, wholly-owned subsidiary of The Prudential Insurance Company
of America, a major diversified insurance and financial services company, and an
affiliate of Prudential Investments Fund Management LLC and The Prudential
Investment Corporation, the Manager and Subadviser, respectively, of the Fund.
Prudential Securities also acts as an investment adviser to shareholders of
the Fund that participate in certain of its managed account programs.
Pursuant to the Trust's Distribution Plan adopted on behalf of the Fund
pursuant to Rule 12b-1 under the Investment Company Act of 1940, PSI may be
reimbursed for its distribution-related expenses at an annual rate of up to .10
of 1% of the average daily net assets of the National Money Market Fund. The
distribution-related expenses for which PSI may be reimbursed include account
servicing fees paid to, or on account of, Financial Advisors of PSI and
representatives of Pruco Securities Corporation (Prusec), an affiliated
broker-dealer, account servicing fees paid to, or on account of,
other broker-dealers or financial institutions which have entered into
agreements with PSI, advertising expenses, the cost of printing and mailing
prospectuses to potential investors and indirect and overhead costs of PSI and
Prusec associated with the sale of Fund shares, including lease, utility,
communications and sales promotion expenses. Until Liquid Assets Fund is
available as an investment for certain accounts that are subject to fiduciary
and prohibited transaction requirements imposed by ERISA, which is expected
to occur on or about December 22, 1997, distribution-related expenses of
the National Money Market Fund will be waived.
State Street Bank and Trust Company (State Street), One Heritage Drive,
North Quincy, Massachusetts 02171, begins serving as the Custodian of the
Trust's assets on December 12, 1997. As Custodian of the Trust's
portfolio securities and cash, State Street maintains certain financial and
accounting books and records pursuant to its agreement with the Trust. State
Street's mailing address is P.O. Box 1713, Boston, Massachusetts 02105.
Prudential Mutual Fund Services LLC (PMFS), Raritan Plaza One, Edison, New
Jersey 08837, will begin serving as Transfer Agent and as Shareholder Servicing
Agent to the Trust on December 22, 1997. In its roles as Transfer Agent and as
Shareholder Servicing Agent, PMFS will maintain certain books and records for
the Trust and the Fund. PMFS is a wholly-owned subsidiary of Prudential
Investments Fund Management LLC. The mailing address for PMFS is P.O. Box
15005, New Brunswick, New Jersey 08906-5005.
