As filed with the Securities and Exchange Commission on December 21, 1995
Securities Act Registration No. 33-33477
Investment Company Act Registration No. 811-6047
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
PRE-EFFECTIVE AMENDMENT NO. [ ]
POST-EFFECTIVE AMENDMENT NO. 10 [X]
AND/OR
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940 [X]
AMENDMENT NO. 11 [X]
(CHECK APPROPRIATE BOX OR BOXES)
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PRUDENTIAL MULTI-SECTOR 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)
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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)
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COPY TO:
PAUL H. DYKSTRA, ESQ.
GARDNER, CARTON & DOUGLAS
QUAKER TOWER
321 NORTH CLARK STREET
CHICAGO, ILLINOIS 60610-4795
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APPROXIMATE DATE OF 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)(1)
[X] on March 4, 1996 pursuant to paragraph (a)(1)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] on (date) pursuant to paragraph (a)(2) 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 COMMON STOCK, PAR
VALUE $.001 PER SHARE. THE REGISTRANT FILED A NOTICE UNDER SUCH RULE FOR ITS
FISCAL YEAR ENDED APRIL 30, 1995 ON OR ABOUT JUNE 29, 1995.
================================================================================
<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
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; General
Information
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; General
Information
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 .............. General Information
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
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>
The Prospectuses, as supplemented, are incorporated herein by reference in
their entirety from Post-Effective Amendment No. 9 to Registrant's Registration
Statement (File No. 33-33477) filed on October 30, 1995.
The Statement of Additional Information, as supplemented, is incorporated
herein by reference in its entirety from Post-Effective Amendment No. 9 to
Registrant's Registration Statement (File No. 33-33477) filed on October 30,
1995, except that the financial statements contained in the Semi-Annual Report,
dated October 30, 1995 of the Registrant are filed herewith and added hereto.
<PAGE>
Portfolio of Investments as of
October 31, 1995 (Unaudited) PRUDENTIAL MULTI-SECTOR FUND, INC.
- ------------------------------------------------------------
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Description Value (Note 1)
<C> <S> <C>
- ------------------------------------------------------------
LONG-TERM INVESTMENTS--92.5%
COMMON STOCKS--91.4%
- ------------------------------------------------------------
Auto Sector--0.8%
135,000 Ford Motor Co. $ 3,881,250
- ------------------------------------------------------------
Basic Industry Sector--4.4%
96,600 Advanta Corp. 3,453,450
140,000 Agrium Inc. (Canada) 5,733,209
75,000 National Steel Corp.(a) 993,750
60,900 Quad Systems Corp.(a) 502,425
65,500 The PMI Group Inc. 3,144,000
74,400 TJ International, Inc. 1,288,050
70,000 Trinity Industries, Inc.(a) 2,073,750
126,400 Uniphase Corp. 3,697,200
------------
20,885,834
- ------------------------------------------------------------
Consumer Goods & Services Sector--5.1%
119,100 Fruit of the Loom, Inc. 2,069,363
66,900 La Quinta Inns, Inc. 1,722,675
52,400 Nissen Co., Ltd. (Japan) 1,509,570
100,000 Philip Morris Cos., Inc. 8,450,000
275,000 RJR Nabisco Holdings Corp. 8,456,250
135,000 Stone Container Corp.(a) 2,227,500
------------
24,435,358
- ------------------------------------------------------------
Energy Sector--8.8%
130,000 Baker Hughes Inc. 2,551,250
300,000 BJ Services Corp.(a) 7,050,000
125,000 Exxon Corp. 9,546,875
465,000(b) Mesa, Inc.(a) 1,976,250
308,300 Noble Drilling Corp.(a) 2,158,100
139,500 Oryx Energy Co. 1,604,250
118,900 Repsol S.A. (ADR) (Spain) 3,522,412
400,000 Rowan Cos., Inc.(a) 2,650,000
40,000 Royal Dutch Petroleum Co.(a) 4,915,000
131,100 Smith International, Inc.(a) 2,097,600
112,800 Talisman Energy, Inc.(a) (Canada) 2,041,343
120,000 YPF Sociedad Anonima (ADR)
(Argentina) 2,055,000
------------
42,168,080
- ------------------------------------------------------------
Financial Services Sector--25.2%
121,400 Ahmanson (H.F.) & Co. $ 3,035,000
200,000 American General Corp. 6,575,000
68,800 Banc One Corp. 2,322,000
152,697 Banco Wiese (ADR) (Peru) 1,011,618
47,700 Chubb Corp. 4,287,038
170,500 Citicorp 11,061,187
170,000 Dean Witter Discover & Co. 8,457,500
43,900 Equitable of Iowa Cos. 1,536,500
130,000 Federal Home Loan Mortgage Corp. 9,002,500
152,500 Federal National Mortgage
Association 15,993,437
82,000 Manufactured Home Communities, Inc. 1,353,000
125,000 NationsBank Corp. 8,218,750
115,000 Nichiei Co. (Japan) 7,131,348
123,800 Republic New York Corp. 7,257,775
230,000 Salomon, Inc. 8,308,750
184,000 SunAmerica, Inc. 11,454,000
200,000 The Equitable Companies, Inc. 4,250,000
180,000 Travelers Inc. 9,090,000
------------
120,345,403
- ------------------------------------------------------------
Health Care Sector--6.0%
150,000 Columbia Healthcare Corp. 7,368,750
107,000 Forest Laboratories, Inc.(a) 4,427,125
55,000 Johnson & Johnson Co. 4,482,500
101,300 Physician Corp. of America(a) 1,557,488
880 Roche Holdings Ltd. 6,368,253
80,000 St. Jude Medical, Inc. 4,260,000
------------
28,464,116
- ------------------------------------------------------------
Leisure--0.6%
117,300 Carnival Cruise Lines, Inc. 2,727,225
</TABLE>
- --------------------------------------------------------------------------------
See Notes to Financial Statements. 3
<PAGE>
Portfolio of Investments as of
October 31, 1995 (Unaudited) PRUDENTIAL MULTI-SECTOR FUND, INC.
- ------------------------------------------------------------
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Description Value (Note 1)
<C> <S> <C>
- ------------------------------------------------------------
Precious Metals Sector--1.7%
280,000 Santa Fe Pacific Gold Corp. $ 2,765,000
189,900 UCAR International Inc.(a) 5,412,150
------------
8,177,150
- ------------------------------------------------------------
Retailing Sector--0.6%
135,900 Caldor Corp.(a) 662,512
91,000 Dillard Department Stores, Inc. 2,468,375
------------
3,130,887
- ------------------------------------------------------------
Technology Sector--37.4%
223,400 Applied Materials, Inc. 11,197,925
200,000 Autodesk, Inc. 6,800,000
89,600 Baan Company, N.V.(a) 3,808,000
190,000 Bay Networks, Inc. 12,587,500
120,000 Cisco Systems, Inc. 9,300,000
141,300 Compaq Computer Corp.(a) 7,877,475
39,100 Computer Associates International,
Inc. 2,150,500
43,500 Comverse Technology, Inc.(a) 989,625
228,000 EMC Corp.(a) 3,534,000
158,590 First Data Corp. 10,486,764
232,000 Integrated Device Technology,
Inc.(a) 4,408,000
150,000 Intel Corp. 10,481,250
157,000 KLA Instruments Corp.(a) 6,711,750
170,000 Loral Corp. 5,036,250
80,000 Micron Technology Inc. 5,650,000
90,000 Microsoft Corp.(a) 9,000,000
130,000 Motorola, Inc. 8,531,250
284,400 Network Express, Inc.(a) 2,595,150
230,000 NEXTEL Communications Inc.(a) 3,191,250
105,000 Nintendo Co., Ltd. (Japan) 7,710,937
145,000 Seagate Technology Inc.(a) 6,488,750
304,000 Silicon Graphics Inc. 10,108,000
49,200 Softkey International Inc.(a) 1,522,740
106,100 Tencor Instruments(a) 4,522,513
80,000 Texas Instruments Inc. 5,460,000
139,100 Ultratech Stepper Inc.(a) 5,564,000
73,700 Verifone, Inc. 1,989,900
278,000 VLSI Technology, Inc.(a) $ 6,533,000
273,000 Western Digital Corp. 4,231,500
------------
178,468,029
- ------------------------------------------------------------
Transportation Sector--0.8%
110,300 Methanex Corp.(a) (Canada) 740,821
85,000 Varity Corp.(a) 3,081,250
------------
3,822,071
------------
Total common stocks
(cost $377,731,850) 436,505,403
------------
CONVERTIBLE PREFERRED STOCKS--1.1%
- ------------------------------------------------------------
Financial Services Sector--1.1%
136,450 Advanta Corporation
(cost $3,875,750) 5,150,988
------------
Total long-term investments
(cost $381,607,600) 441,656,391
------------
Principal
Amount
(000)
- --------
SHORT-TERM INVESTMENTS--6.0%
- ------------------------------------------------------------
U.S. Government Securities--1.2%
U.S. Treasury Bills,
$1,200(b) 5.43%, 11/16/95 1,197,407
1,500(b) 5.435%, 11/16/95 1,496,759
500(b) 5.22%, 12/14/95 496,932
2,525(b) 5.30%, 12/14/95 2,509,504
------------
Total U. S. Government Securities
(cost $5,699,786) 5,700,602
------------
- ------------------------------------------------------------
Repurchase Agreement--4.8%
23,114 Joint Repurchase Agreement
Account,
5.89%, 11/1/95, (Note 5)
(cost $23,114,000) 23,114,000
------------
Total short-term investments
(cost $28,813,786) 28,814,602
------------
Total investments before short
sales - 98.5%
(cost $410,421,386; Note 4) 470,470,993
------------
</TABLE>
- --------------------------------------------------------------------------------
4 See Notes to Financial Statements.
<PAGE>
PRUDENTIAL MULTI-SECTOR FUND, INC.
Portfolio of Investments as of October 31, 1995 (Unaudited)
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Description Value (Note 1)
<C> <S> <C>
- ------------------------------------------------------------
COMMON STOCKS SOLD SHORT(a)--(2.4)%
- ------------------------------------------------------------
Basic Industry Sector--(0.2%)
100,000 Centocor Inc. $ (1,125,000)
- ------------------------------------------------------------
Consumer Goods & Service Sector--(0.8%)
30,000 NIKE, Inc. (1,702,500)
60,000 Reebok International, Ltd. (2,040,000)
------------
(3,742,500)
- ------------------------------------------------------------
Retailing Sector--(1.2)%
60,000 AutoZone, Inc.(a) (1,485,000)
50,000 Cracker Barrel Old Country Store,
Inc. (850,000)
45,000 Petsmart Inc. (1,507,500)
50,000 Starbucks Corp. (1,962,500)
------------
(5,805,000)
- ------------------------------------------------------------
Technology Sector--(0.2%)
30,000 Advanced Micro (716,250)
------------
Total common stocks sold short
(proceeds $10,953,800) (11,388,750)
------------
- ------------------------------------------------------------
Total Investments, net of short sales--96.1% 459,082,243
Other assets in excess of other
liabilities--3.9% 18,590,744
------------
Net Assets--100% $477,672,987
------------
------------
</TABLE>
- ---------------
(a) Non-income producing security.
(b) Pledged as collateral on short sales.
ADR--American Depository Receipt.
- --------------------------------------------------------------------------------
See Notes to Financial Statements. 5
<PAGE>
Statement of Assets and Liabilities PRUDENTIAL MULTI-SECTOR FUND, INC.
(Unaudited)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Assets October 31, 1995
----------------
Investments, at value (cost $410,421,386)................................................................... $ 470,470,993
Cash........................................................................................................ 5,915
Deposits with broker for securities sold short.............................................................. 10,953,800
Receivable for investments sold............................................................................. 9,391,395
Interest and dividends receivable........................................................................... 856,909
Forward currency contracts-amount receivable from counterparties............................................ 721,480
Receivable for Fund shares sold............................................................................. 348,551
Deferred expenses and other assets.......................................................................... 40,651
--------------
Total assets............................................................................................. 492,789,694
--------------
Liabilities
Investments sold short, at value (proceeds $10,953,800)..................................................... 11,388,750
Payable for investments purchased........................................................................... 2,461,847
Payable for Fund shares reacquired.......................................................................... 617,644
Distribution fee payable.................................................................................... 265,359
Management fee payable...................................................................................... 255,887
Accrued expenses............................................................................................ 127,220
--------------
Total liabilities........................................................................................ 15,116,707
--------------
Net Assets.................................................................................................. $ 477,672,987
--------------
--------------
Net assets were comprised of:
Common stock, at par..................................................................................... $ 33,834
Paid-in capital in excess of par......................................................................... 386,275,854
--------------
386,309,688
Distributions in excess of net investment income......................................................... 49,037
Accumulated net realized capital and currency gains...................................................... 30,978,681
Net unrealized appreciation on investments and foreign currencies........................................ 60,335,581
--------------
Net assets, October 31, 1995................................................................................ $ 477,672,987
--------------
--------------
Class A:
Net asset value and redemption price per share
($223,527,415 / 15,712,251 shares of common stock issued and outstanding)............................. $14.23
Maximum sales charge (5% of offering price).............................................................. .75
--------------
Maximum offering price to public......................................................................... $14.98
--------------
--------------
Class B:
Net asset value, offering price and redemption price per share
($248,646,121 / 17,729,210 shares of common stock issued and outstanding)............................. $14.02
--------------
--------------
Class C:
Net asset value, offering price and redemption price per share
($5,499,451 / 392,137 shares of common stock issued and outstanding).................................. $14.02
--------------
--------------
</TABLE>
- --------------------------------------------------------------------------------
6 See Notes to Financial Statements.
<PAGE>
PRUDENTIAL MULTI-SECTOR FUND, INC.
Statement of Operations (Unaudited)
- ------------------------------------------------------------
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended
Net Investment Income October 31, 1995
----------------
<S> <C>
Income
Dividends (net of foreign withholding taxes
of $63,410)............................. $ 2,286,656
Interest................................... 1,310,477
----------------
Total income............................ 3,597,133
----------------
Expenses
Distribution fee--Class A.................. 229,245
Distribution fee--Class B.................. 1,162,821
Distribution fee--Class C.................. 24,061
Management fee............................. 1,326,851
Transfer agent's fees and expenses......... 236,000
Reports to shareholders.................... 133,000
Custodian's fees and expenses.............. 129,000
Registration fees.......................... 21,500
Directors' fees and expenses............... 19,700
Legal fees and expenses.................... 18,000
Audit fee and expenses..................... 17,500
Amortization of organization expense....... 7,000
Miscellaneous.............................. 2,454
----------------
Total expenses.......................... 3,327,132
----------------
Net investment income......................... 270,001
----------------
Realized and Unrealized Gain (Loss) on
Investments and Foreign Currency Transactions
Net realized gain (loss) on:
Security transactions...................... 33,458,401
Foreign currency transactions.............. (376,722)
Short sale transactions.................... (169,051)
----------------
32,912,628
----------------
Net change in unrealized
appreciation/depreciatiion on:
Securities................................. 46,326,648
Short sales................................ (1,196,664)
Foreign currencies......................... 1,226,461
----------------
46,356,445
----------------
Net gain on investments and foreign currency
transactions............................... 79,269,073
----------------
Net Increase in Net Assets Resulting
from Operations............................... $ 79,539,074
----------------
----------------
</TABLE>
PRUDENTIAL MULTI-SECTOR FUND, INC.
Statement of Changes in Net Assets (Unaudited)
<TABLE>
<CAPTION>
Six Months Year Ended
Increase Ended April 30,
in Net Assets October 31, 1995 1995
---------------- ---------
<S> <C> <C>
Operations
Net investment income......... $ 270,001 $ 282,795
Net realized gain on
investments
and foreign currency
transactions............... 32,912,628 20,151,682
Net change in unrealized
appreciation of
investments................ 46,356,445 3,370,491
---------------- ------------
Net increase in net assets
resulting from
operations................. 79,539,074 23,804,968
---------------- ------------
Net equalization credits......... 569,551 72,776
---------------- ------------
Dividends and distributions (Note 1)
Dividends from net investment
income
Class A.................... (136,933) --
Class B.................... (130,186) --
Class C.................... (2,882) --
---------------- ------------
(270,001) --
---------------- ------------
Distributions in excess of net
investment income
Class A.................... (84,173) --
Class B.................... (80,027) --
Class C.................... (1,771) --
---------------- ------------
(165,971) --
---------------- ------------
Distributions from net capital
and currency gains
Class A.................... (3,814,077) (5,260,734)
Class B.................... (9,669,790) (13,945,867)
Class C.................... (214,070) (48,280)
---------------- ------------
(13,697,937) (19,254,881)
---------------- ------------
Fund share transactions (net of
conversion) (Note 6)
Net proceeds from Fund shares
subscribed (Note 7)........ 211,272,030 131,985,932
Net asset value of Fund shares
issued in reinvestment of
dividends and
distributions.............. 13,255,569 17,954,751
Cost of shares reacquired..... (77,925,453) (70,803,068)
---------------- ------------
Net increase in net assets
from Fund share
transactions............... 146,602,146 79,137,615
---------------- ------------
Total increase................... 212,576,862 83,760,478
Net Assets
Beginning of period.............. 265,096,125 181,335,647
---------------- ------------
End of period.................... $477,672,987 $265,096,125
---------------- ------------
---------------- ------------
</TABLE>
- --------------------------------------------------------------------------------
See Notes to Financial Statements. 7
<PAGE>
Notes to Financial Statements (Unaudited) PRUDENTIAL MULTI-SECTOR FUND, INC.
- --------------------------------------------------------------------------------
Prudential Multi-Sector Fund, Inc. (the "Fund"), is registered under the
Investment Company Act of 1940 as a diversified, open-end management investment
company. The Fund was incorporated in Maryland on February 21, 1990 and had no
operations until May 11, 1990 when 4,398 shares each of Class A and Class B
common stock were sold for $100,000 to Prudential Mutual Fund Management, Inc.
("PMF"). Investment operations commenced June 29, 1990. The Fund's investment
objective is long-term growth of capital by primarily investing in equity
securities of companies in various economic sectors.
- ------------------------------------------------------------
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: Investments, traded on a national securities exchange and
NASDAQ national market equity securities 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 whose primary
market is believed to be over-the-counter) and listed securities for which no
sales were reported on that date are valued at the mean between the last
reported bid and asked prices. 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. Futures contracts and options thereon are
valued at their last sale prices as of the close of the commodities exchange or
board of trade. Securities for which market quotations are not readily available
are valued at fair value as determined in good faith by or under the direction
of the Fund's Board of Directors.
Short-term securities which mature in more than 60 days are valued at current
market quotations. Short-term securities which mature in 60 days or less are
valued at amortized cost.
In connection with transactions in repurchase agreements, 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. To the extent that any repurchase
transaction exceeds one business day, the value of the collateral is
marked-to-market on a daily basis to ensure the adequacy of the collateral. If
the seller defaults, and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited.
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 rates of exchange.
(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 the end of the fiscal year. 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. Accordingly, these realized foreign
currency gains (losses) are included in the reported net realized gains on
security transactions.
Net realized loss on foreign currency transactions of $376,722 represents net
foreign exchange losses from sales and maturities of short-term securities,
holding of foreign currencies, currency gains or losses realized between the
trade and settlement dates of 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
currency gains and losses from valuing foreign currency denominated assets and
liabilities at 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 level of governmental supervision and regulation of
foreign securities markets and the possibility of political or economic
instability.
Forward Currency Contracts: A forward currency contract is a commitment to
purchase or sell a foreign currency at a future date at a negotiated forward
rate. The Fund enters into forward currency contracts in order to hedge its
exposure to changes in foreign currency exchange rates on its foreign portfolio
holdings or on specific receivables and payables denominated in a foreign
currency. The contracts are valued daily at current
- --------------------------------------------------------------------------------
8
<PAGE>
Notes to Financial Statements (Unaudited) PRUDENTIAL MULTI-SECTOR FUND, INC.
- --------------------------------------------------------------------------------
exchange rates and any unrealized gain or loss is included in net unrealized
appreciation or depreciation on investments. Gain or loss is realized on the
settlement date of the contract equal to the difference between the settlement
value of the original and renegotiated forward contracts. This gain or loss, if
any, is included in net realized gain (loss) on foreign currency transactions.
Risks may arise upon entering into these contracts from the potential inability
of the counterparties to meet the terms of their contracts.
Short Sales: The Fund may sell a security it does not own in anticipation of a
decline in the market value of that security (short sale). When the Fund makes a
short sale, it must borrow the security sold short and deliver it to the
broker-dealer through which it made the short sale as collateral for its
obligation to deliver the security upon conclusion of the sale. The Fund may
have to pay a fee to borrow the particular security and may be obligated to pay
over any payments received on such borrowed securities. A gain, limited to the
price at which the Fund sold the security short, or a loss, unlimited in
magnitude, will be recognized upon the termination of a short sale if the market
price at termination is less than or greater than, respectively, the proceeds
originally received.
Securities Transactions and Investment Income: Securities transactions are
recorded on the trade date. Realized gains and losses on sales of securities are
calculated on the identified cost basis. Dividend income is recorded on the
ex-dividend date and interest income is recorded on the accrual basis. Net
investment income, other than distribution fees, and unrealized and realized
gains or losses are allocated daily to each class of shares 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.
Dividends and Distributions: Dividends from net investment income are declared
and paid semi-annually. The Fund will distribute net capital gains, if any, at
least annually. Dividends and distributions are recorded on the ex-dividend
date.
Income distributions and capital gains distributions are determined in
accordance with income tax regulations which may differ from generally accepted
accounting principles.
Reclassification of Capital Accounts: The Fund accounts for and reports
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. During the six months ended October 31, 1995, the Fund reclassified
$376,722 of foreign currency losses which were recognized for tax purposes in
the current fiscal year by decreasing undistributed net investment income and
increasing accumulated net realized capital and currency gains. Net investment
income, net realized gains, and net assets were not affected by this change.
Taxes: It is the Fund's policy to meet the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute all of its
taxable net income to its shareholders. Therefore, no federal income tax
provision is required.
Withholding taxes on foreign dividends have been provided for in accordance with
the Fund's understanding of the applicable country's tax rules and rates.
Deferred Organizational Expenses: Approximately $225,000 of expenses were
incurred in connection with the organization and initial registration of the
Fund. This amount has been amortized over a period of 60 months from the date
investment operations commenced.
- ------------------------------------------------------------
Note 2. Agreements
The Fund has a management agreement with 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 services of PIC, the cost of 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 .65 of 1% of the Fund's average daily net assets.
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
- --------------------------------------------------------------------------------
9
<PAGE>
Notes to Financial Statements (Unaudited) PRUDENTIAL MULTI-SECTOR FUND, INC.
- --------------------------------------------------------------------------------
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 the Distributors
for distribution-related activities at an annual rate of up to .30 of 1%, 1% and
1%, of the average daily net assets of the Class A, B and C shares,
respectively. Such expenses under the Plans were .25 of 1% of the average daily
net assets of Class A shares and 1% of the average daily net assets of both the
Class B and C shares for the six months ended October 31, 1995.
PMFD has advised the Fund that it has received approximately $97,500 in
front-end sales charges resulting from sales of Class A shares during the six
months ended October 31, 1995. From these fees, PMFD paid such sales charges to
dealers (PSI and Prusec) which in turn paid commissions to salespersons and
incurred other distribution costs.
PSI has advised the Fund that for the six months ended October 31, 1995, it
received approximately $284,000 and $1,000 in contingent deferred sales charges
imposed upon redemptions by certain Class B and Class C shareholders,
respectively.
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. During the six months ended October
31, 1995, the Fund incurred fees of approximately $330,000 for the services of
PMFS. As of October 31, 1995, approximately $27,000 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 October 31, 1995, PSI earned approximately $35,000 in
brokerage commissions from portfolio transactions executed on behalf of the
Fund.
- ------------------------------------------------------------
Note 4. Portfolio Securities
Purchases and sales of investment securities, other than short-term investments,
for the six months ended October 31, 1995 aggregated $352,567,549 and
$221,604,195, respectively.
The federal income tax basis of the Fund's investments at October 31, 1995 was
$410,705,868 and, accordingly, net unrealized appreciation for federal income
tax purposes was $59,765,125 (gross unrealized appreciation--$79,042,157, gross
unrealized depreciation--$19,277,032).
At October 31, 1995, the Fund had outstanding forward currency contracts to sell
foreign currency as follows:
<TABLE>
<CAPTION>
Value at
Foreign Currency Settlement Date Current Appreciation/
Sale Contracts Receivable Value (Depreciation)
<S> <C> <C> <C>
- ------------------- ---------------- ----------- ---------------
Japanese Yen,
expiring 2/02/96 $ 14,975,290 $14,862,775 $ 112,515
Swiss Francs,
expiring 12/29/95 6,129,597 6,179,739 (50,142)
---------------- ----------- ---------------
$ 21,104,887 $21,042,514 $ 62,373
---------------- ----------- ---------------
---------------- ----------- ---------------
</TABLE>
- ------------------------------------------------------------
Note 5. Joint Repurchase Agreement Account
The Fund, 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 October 31, 1995, the Fund
had a 2.48% undivided interest in the repurchase agreements in the joint
account. The undivided interest for the Fund represents $23,114,000 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., 5.875%, in the principal amount of $273,000,000, repurchase
price $273,044,552, due 11/1/95. The value of the collateral including accrued
interest is $278,800,077.
CS First Boston Corp., 5.90%, in the principal amount of $273,000,000,
repurchase price $273,044,742, due 11/1/95. The value of the collateral
including accrued interest is $278,529,780.
Goldman, Sachs & Co., 5.88%, in the principal amount of $273,000,000, repurchase
price $273,044,590, due 11/1/95. The value of the collateral including accrued
interest is $278,460,050.
Smith Barney & Co., 5.93%, in the principal amount of $114,753,000, repurchase
price $114,771,902, due 11/1/95. The value of the collateral including accrued
interest is $117,048,982.
- --------------------------------------------------------------------------------
10
<PAGE>
Notes to Financial Statements (Unaudited) PRUDENTIAL MULTI-SECTOR FUND, INC.
- --------------------------------------------------------------------------------
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.
The Fund has authorized 2 billion shares of common stock, $.001 par value per
share, equally divided into three classes, designated Class A, B and Class C
common stock.
Transactions in shares of common stock were as follows:
<TABLE>
<CAPTION>
Class A Shares Amount
- ------------------------------- ---------------- ------------
<S> <C> <C>
Six months ended October 31,
1995:
Shares sold.................... 3,140,621 $130,755,173
Shares issued in connection
with acquisition of
Prudential Strategist Fund
(Note 7)..................... 10,275,056 26,467,368
Shares issued in reinvestment
of dividends and
distributions................ 286,100 3,850,915
Shares reacquired.............. (3,862,896) (54,285,539)
---------------- ------------
Net increase in shares
outstanding before
conversion................... 9,838,881 106,787,917
Shares issued upon conversion
from Class B and C........... 220,235 2,994,039
---------------- ------------
Net increase in shares
outstanding.................. 10,059,116 $109,781,956
---------------- ------------
---------------- ------------
Year ended April 30, 1995:
Shares sold.................... 3,485,186 $45,817,949
Shares issued in reinvestment
of distributions............. 389,581 5,024,771
Shares reacquired.............. (2,985,480) (39,186,110 )
---------------- ------------
Net increase in shares
outstanding before
conversion................... 889,287 11,656,610
Shares issued upon conversion
from Class B................. 733,225 9,121,406
---------------- ------------
Net increase in shares
outstanding.................. 1,622,512 $20,778,016
---------------- ------------
---------------- ------------
<CAPTION>
Class B Shares Amount
---------------- ------------
<S> <C> <C>
Six months ended October 31,
1995:
Shares sold.................... 1,974,235 $36,381,080
Shares issued in connection
with acquisition of
Prudential Strategist Fund
(Note 7)..................... 3,011,418 15,860,707
Shares issued in reinvestment
of dividends and
distributions................ 687,660 9,194,015
Shares reacquired.............. (1,685,140) (23,380,929)
---------------- ------------
Net increase in shares
outstanding before
conversion................... 3,988,173 38,054,873
Shares reacquired upon
conversion
from Class A................. (210,850) (2,901,259)
---------------- ------------
Net increase in shares
outstanding.................. 3,777,323 $35,153,614
---------------- ------------
---------------- ------------
Year ended April 30, 1995:
Shares sold.................... 6,351,539 $82,308,938
Shares issued in reinvestment
of distributions............. 1,004,374 12,882,502
Shares reacquired.............. (2,410,850) (31,149,102)
---------------- ------------
Net increase in shares
outstanding before
conversion................... 4,945,063 64,042,338
Shares reacquired upon
conversion from Class A...... (725,642) (9,121,406)
---------------- ------------
Net increase in shares
outstanding.................. 4,219,421 $54,920,932
---------------- ------------
---------------- ------------
<CAPTION>
Class C
- -------------------------------
<S> <C> <C>
Six months ended October 31,
1995:
Shares sold.................... 126,691 $ 1,795,364
Shares issued in connection
with acquisition of
Prudential Strategist Fund
(Note 7)..................... 5,166 12,338
Shares issued in reinvestment
of dividends and
distributions................ 15,766 210,639
Shares reacquired.............. (18,633) (258,985)
---------------- ------------
Net increase in shares
outstanding
before conversion............ 128,990 1,759,356
Shares reacquired upon
conversion from Class A...... (6,709) (92,780)
---------------- ------------
Net increase in shares
outstanding.................. 122,281 $ 1,666,576
---------------- ------------
---------------- ------------
<CAPTION>
August 1, 1994* through
April 30, 1995:
<S> <C> <C>
Shares sold.................... 303,058 $ 3,859,045
Shares issued in reinvestment
of distributions............. 3,797 47,478
Shares reacquired.............. (36,999) (467,856)
---------------- ------------
Net increase in shares
outstanding.................. 269,856 $ 3,438,667
---------------- ------------
---------------- ------------
</TABLE>
- ---------------
* Commencement of offering of Class C shares.
- --------------------------------------------------------------------------------
11
<PAGE>
Notes to Financial Statements (Unaudited) PRUDENTIAL MULTI-SECTOR FUND, INC.
- --------------------------------------------------------------------------------
Note 7. Acquisition of Prudential Strategist Fund
On June 23, 1995, the Fund acquired all the net assets of Prudential Strategist
Fund, Inc. ("Strategist") pursuant to a plan of reorganization approved by
Strategist shareholders on June 9, 1995. The acquisition was accomplished by a
tax-free exchange of 8,589,796 Class A shares, 2,528,242 Class B shares, and
4,337 Class C shares of the Fund (valued at $181,061,433 in the aggregate) for
the Class A, B and C shares of Strategist outstanding on June 23, 1995.
Strategist's net assets at that date ($181,061,433), including $42,340,413 of
unrealized depreciation, were combined with those of the Fund. The aggregate net
assets of the Fund and Strategist immediately before the acquisition were
$283,310,931 and $181,061,433, respectively.
- ------------------------------------------------------------
Note 8. Distributions
On November 20, 1995, the Board of Directors of the Fund announced distributions
from foreign currency gains of $.01 per share, from net short-term capital gains
of $.565 per share and from net long-term capital gains of $.352 per share for
Class A, B and C shares, respectively. These distributions are payable on
November 29, 1995 to shareholders of record on November 24, 1995.
- --------------------------------------------------------------------------------
12
<PAGE>
Financial Highlights (Unaudited) PRUDENTIAL MULTI-SECTOR FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class A
-------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
June 29,
Six Months 1990(c)
Ended Years Ended April 30, Through
October 31, ------------------------------------------- April 30,
1995 1995(b) 1994 1993 1992 1991
----------- ------- ------- ------- ------- ---------
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period....... $ 13.45 $ 13.21 $ 13.19 $ 12.51 $ 12.10 $ 11.37
----------- ------- ------- ------- ------- ---------
Income from investment operations:
Net investment income...................... .04 .09 .18 .30 .23 .40
Net realized and unrealized gain on
investments and foreign currency
transactions............................ 1.47 1.44 1.64 1.47 .50 .59
----------- ------- ------- ------- ------- ---------
Total from investment operations........ 1.51 1.53 1.82 1.77 .73 .99
----------- ------- ------- ------- ------- ---------
Less distributions:
Dividends from net investment income....... (.02) -- (.21) (.30) (.30) (.26)
Distributions in excess of net investment
income.................................. (.02) -- -- -- -- --
Distributions from net capital and currency
gains................................... (.69) (1.29) (1.59) (.79) (.02) --
----------- ------- ------- ------- ------- ---------
Total distributions..................... (.73) (1.29) (1.80) (1.09) (.32) (.26)
----------- ------- ------- ------- ------- ---------
Net asset value, end of period............. $ 14.23 $ 13.45 $ 13.21 $ 13.19 $ 12.51 $ 12.10
----------- ------- ------- ------- ------- ---------
----------- ------- ------- ------- ------- ---------
TOTAL RETURN(d)............................ 11.43% 12.15% 14.16% 15.14% 6.16% 17.64%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000)............ $ 223,528 $76,035 $53,237 $43,390 $52,625 $59,085
Average net assets (000)................... $ 182,399 $59,316 $49,840 $46,890 $57,403 $55,545
Ratios to average net assets:
Expenses, including distribution fees... 1.16%(a) 1.44% 1.30% 1.28% 1.29% 1.35%(a)
Expenses, excluding distribution fees... .91%(a) 1.19% 1.08% 1.08% 1.09% 1.15%(a)
Net investment income (loss)............ .47%(a) .68% 1.15% 2.44% 1.83% 4.28%(a)
Portfolio turnover......................... 57% 122% 110% 209% 147% 253%
</TABLE>
- ---------------
(a) Annualized.
(b) Calculated based upon weighted average shares outstanding during the year.
(c) Commencement of offering of Class A shares.
(d) 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 return for periods of less than a full year are not
annualized.
- --------------------------------------------------------------------------------
See Notes to Financial Statements. 13
<PAGE>
Financial Highlights (Unaudited) PRUDENTIAL MULTI-SECTOR FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class B
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
June 29,
Six Months 1990(c)
Ended Years Ended April 30, Through
October 31, ---------------------------------------------- April 30,
1995 1995(b) 1994 1993 1992 1991
----------- -------- -------- ------- -------- ----------
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period....... $ 13.29 $ 13.16 $ 13.15 $ 12.47 $ 12.06 $ 11.37
----------- -------- -------- ------- -------- ----------
Income from investment operations:
Net investment income (loss)............... -- (.01) .07 .19 .13 .32
Net realized and unrealized gain on
investments and foreign currency
transactions............................ 1.44 1.43 1.63 1.47 .51 .59
----------- -------- -------- ------- -------- ----------
Total from investment operations........ 1.44 1.42 1.70 1.66 .64 .91
----------- -------- -------- ------- -------- ----------
Less distributions:
Dividends from net investment income....... (.01) -- (.10) (.19) (.21) (.22)
Distributions in excess of net investment
income.................................. (.01) -- -- -- (.01) --
Distributions from net capital and currency
gains................................... (.69) (1.29) (1.59) (.79) (.02) --
----------- -------- -------- ------- -------- ----------
Total distributions..................... (.71) (1.29) (1.69) (.98) (.23) (.22)
----------- -------- -------- ------- -------- ----------
Net asset value, end of period............. $ 14.02 $ 13.29 $ 13.16 $ 13.15 $ 12.47 $ 12.06
----------- -------- -------- ------- -------- ----------
----------- -------- -------- ------- -------- ----------
TOTAL RETURN(e)............................ 11.06% 11.31% 13.22% 14.13% 5.39% 16.14%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000)............ $ 248,646 $185,474 $128,098 $92,921 $108,276 $ 99,537
Average net assets (000)................... $ 231,301 $153,209 $108,981 $99,072 $108,510 $ 82,890
Ratios to average net assets:
Expenses, including distribution fees... 1.91%(a) 2.19% 2.08% 2.08% 2.09% 2.15%*
Expenses, excluding distribution fees... .91%(a) 1.19% 1.08% 1.08% 1.09% 1.15%*
Net investment income (loss)............ (.13)%(a) (.07)% .35% 1.64% 1.03% 3.39%*
Portfolio turnover......................... 57% 122% 110% 209% 147% 253%
<CAPTION>
Class C
--------------------------
<S> <C> <C>
August 1,
Six Months 1994(d)
Ended Through
October 31, April 30,
1995 1995(b)
----- -----
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period....... $ 13.29 $13.74
----- -----
Income from investment operations:
Net investment income (loss)............... -- --
Net realized and unrealized gain on
investments and foreign currency
transactions............................ 1.44 .84
----- -----
Total from investment operations........ 1.44 .84
----- -----
Less distributions:
Dividends from net investment income....... (.01) --
Distributions in excess of net investment
income.................................. (.01) --
Distributions from net capital and currency
gains................................... (.69) (1.29)
----- -----
Total distributions..................... (.71) (1.29)
----- -----
Net asset value, end of period............. $ 14.02 $13.29
----- -----
----- -----
TOTAL RETURN(e)............................ 11.06% 6.62%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000)............ $ 5,499 $3,587
Average net assets (000)................... $ 4,786 $1,653
Ratios to average net assets:
Expenses, including distribution fees... 1.91%(a) 2.37%(a)
Expenses, excluding distribution fees... .91%(a) 1.37%(a)
Net investment income (loss)............ (.13)%(a) .03%(a)
Portfolio turnover......................... 57% 122%
</TABLE>
- ---------------
(a) Annualized.
(b) Calculated based upon weighted average shares outstanding during the year.
(c) Commencement of investment operations.
(d) Commencement of offering of Class C shares.
(e) 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 return for periods of less than a full year are not
annualized.
- --------------------------------------------------------------------------------
14 See Notes to Financial Statements.
<PAGE>
PART C
OTHER INFORMATION
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS.
(A) FINANCIAL STATEMENTS:
(1) Financial statements included in the Prospectus constituting Part A
of this Registration Statement:
Financial Highlights.
(2) Financial statements included in the Statement of Additional
Information constituting Part B of this Registration Statement:
Portfolio of Investments at April 30, 1995 and October 30, 1995
(unaudited).
Statement of Assets and Liabilities at April 30, 1995 and October
30, 1995 (unaudited).
Statement of Operations for the year ended April 30, 1995 and the
six months ended October 30, 1995 (unaudited).
Statement of Changes in Net Assets for the years ended April 30,
1995 and April 30, 1994 and the six months ended October 30, 1995
(unaudited).
Notes to Financial Statements.
Financial Highlights for the five years ended October 31, 1995 and
the six months ended October 30, 1995 (unaudited).
Independent Auditors' Report.
(B) EXHIBITS:
1. Articles of Restatement. Incorporated by reference to Exhibit No. 1
to Post-Effective Amendment No. 8 to the Registration Statement on
Form N-1A filed via EDGAR on June 29, 1995 (File No. 33-33477).
2. By-Laws of the Registrant. Incorporated by reference to Exhibit No.
2 to the Registration Statement on Form N-1A filed on February 23,
1990 (File No. 33-33477).
4. (a) Specimen certificate for Class A shares of common stock, $.001
par value, of the Registrant. Incorporated by reference to Exhibit
No. 4(a) to Post-Effective Amendment No. 1 to the Registration
Statement on Form N-1A filed on November 30, 1990 (File No.
33-33477).
(b) Specimen certificate for Class B shares of common stock, $.001
par value, of the Registrant. Incorporated by reference to Exhibit
No. 4(b) to Post-Effective Amendment No. 1 to the Registration
Statement on Form N-1A filed on November 30, 1990 (File No.
33-33477).
(c) Instruments defining rights of shareholders. Incorporated by
reference to Exhibits 1 and 2.
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. 1 to the Registration
Statement on Form N-1A filed on November 30, 1990 (File No.
33-33477).
(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. 1 to
the Registration Statement on Form N-1A filed on November 30, 1990
(File No. 33-33477).
6. (a) Distribution Agreement for Class A shares. Incorporated by
reference to Exhibit No. 6(a) to Post-Effective Amendment No. 8 to
the Registration Statement on Form N-1A filed via EDGAR on June 29,
1995 (File No. 33-33477).
(b) Distribution Agreement for Class B shares. Incorporated by
reference to Exhibit No. 6(b) to Post-Effective Amendment No. 8 to
the Registration Statement on Form N-1A filed via EDGAR on June
29, 1995 (File No. 33-33477).
(c) Distribution Agreement for Class C shares. Incorporated by
reference to Exhibit No. 6(c) to Post-Effective Amendment No. 8 to
the Registration Statement on Form N-1A filed via EDGAR on June
29, 1995 (File No. 33-33477).
(d) Form of Distribution Agreement for Class Z shares. Incorporated
by reference to Exhibit No. 6(d) to Post-Effective Amendment No. 9
to the Registration Statement on Form N-1A filed via EDGAR on
October 30, 1995 (File No. 33-33477).
C-1
<PAGE>
8. Custodian Contract between the Registrant and State Street Bank and
Trust Company. Incorporated by reference to Exhibit No. 8 to
Post-Effective Amendment No. 1 to the Registration Statement on Form
N-1A filed on November 30, 1990 (File No. 33-33477).
9. Transfer Agency and Service Agreement between the Registrant and
Prudential Mutual Fund Services, Inc. Incorporated by reference to
Exhibit No. 9 to Post-Effective Amendment No. 1 to the Registration
Statement on Form N-1A filed on November 30, 1990 (File No.
33-33477).
10. (a) Opinion of Counsel. Incorporated by reference to Exhibit No. 10
to Pre-Effective Amendment No. 2 to the Registration Statement on
Form N-1A filed on May 21, 1990 (File No. 33-33477).
(b) Opinion of Counsel. Incorporated by reference to Exhibit No.
10(b) to Post-Effective Amendment No. 4 to the Registration
Statement on Form N-1A filed on June 30, 1993 (File No. 33-33477).
11. Consent of Independent Accountants.*
13. Purchase Agreement. Incorporated by reference to Exhibit No. 13 to
Pre-Effective Amendment No. 2 to the Registration Statement on Form
N-1A filed on May 21, 1990 (File No. 33-33477).
15. (a) Distribution and Service Plan for Class A shares. Incorporated
by reference to Exhibit No. 15(a) to Post-Effective Amendment No. 8
to the Registration Statement on Form N-1A filed via EDGAR on June
29, 1995 (File No. 33-33477).
(b) Distribution and Service Plan for Class B shares. Incorporated
by reference to Exhibit No. 15(b) to Post-Effective Amendment No. 8
to the Registration Statement on Form N-1A filed via EDGAR on June
29, 1995 (File No. 33-33477).
(c) Distribution and Service Plan for Class C shares. Incorporated
by reference to Exhibit No. 15(c) to Post-Effective Amendment No. 8
to the Registration Statement on Form N-1A filed via EDGAR on June
29, 1995 (File No. 33-33477).
16. (a) Schedule of Computation of Performance Quotations (Class A
Shares). Incorporated by reference to Exhibit No. 16(a) to
Post-Effective Amendment No. 1 to the Registration Statement on Form
N-1A filed on November 30, 1990 (File No. 33-33477).
(b) Schedule of Computation of Performance Quotations (Class B
Shares). Incorporated by reference to Exhibit No. 16(b) to
Post-Effective Amendment No. 1 to the Registration Statement on Form
N-1A filed on November 30, 1990 (File No. 33-33477).
18. Rule 18f-3 Plan. Incorporated by reference to Exhibit No. 18 to
Post-Effective Amendment No. 9 to the Registration Statement on Form
N-1A filed via EDGAR on October 30, 1995 (File No. 33-33477).
27. Financial Data Schedules.*
Other Exhibits
Powers of Attorney for
Edward D. Beach
Donald D. Lennox
Douglas H. McCorkindale
Thomas T. Mooney
Louis A. Weil, III
Executed copies filed under Other Exhibits to Pre-Effective Amendment No. 2 to
the Registration Statement on Form N-1A (File No. 33-33477) filed on May 21,
1990.
- -----------
*Filed herewith.
ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT.
None.
ITEM 26. NUMBER OF HOLDERS OF SECURITIES.
As of November 3, 1995 there were 36,189, 29,661 and 477 record holders of
Class A, Class B and Class C shares, respectively, of common stock, $.001 par
value per share, of the Registrant.
ITEM 27. INDEMNIFICATION.
As permitted by Sections 17(h) and (i) of the Investment Company Act of
1940 (the 1940 Act) and pursuant to Article VII of the Fund's By-Laws (Exhibit 2
to the Registration Statement), officers, directors, employees and agents of the
Registrant will not
C-2
<PAGE>
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
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(a), 6(b), 6(c), 6(d) and 6(e) 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 Sections 17(h) and 17(i) of such Act remain
in effect and are consistently applied.
ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER.
(i) Prudential Mutual Fund Management, Inc. (PMF)
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. 801-31104, filed on March 30, 1995).
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
- ---------------- ----------------- ---------------------
Brendan D. Boyle Executive Vice Executive Vice President,
President, Director Director of Marketing and
of Marketing and Director, PMF; Senior Vice
Director President, Prudential
Securities Incorporated
(Prudential Securities);
Chairman and Director of
Prudential Mutual Fund
Distributors, Inc. (PMFD)
Stephen P. Fisher Senior Vice President Senior Vice President, PMF;
Senior Vice President,
Prudential Securities; Vice
President, PMFD
C-3
<PAGE>
NAME AND ADDRESS POSITION WITH PMF PRINCIPAL OCCUPATIONS
- ---------------- ----------------- ---------------------
Frank W. Giordano Executive Vice Executive Vice President,
President, General General Counsel, Secretary
Counsel, Secretary and and Director, PMF and PMFD;
Director Senior Vice President,
Prudential Securities;
Director, Prudential Mutual
Fund Services, Inc. (PMFS)
Robert F. Gunia Executive Vice Executive Vice President, Chief
President, Chief Financial and Administrative
Financial and Officer, Treasurer and
Administrative Officer, Director, PMF; Senior Vice
Treasurer and Director President, Prudential
Securities; Executive Vice
President, Chief Financial
Officer, Treasurer and
Director, PMFD; Director,
PMFS
Theresa Hamacher Director Director, PMF; Vice President,
751 Broad St. The Prudential Insurance
Newark, NJ 07102 Company of America
(Prudential); Vice President,
The Prudential Investment
Corporation (PIC)
Timothy J. O'Brien Director President, Chief Executive
Raritan Plaza One, Officer, Chief Operating
Edison, NJ 08837 Officer and Director, PMFD;
Chief Executive Officer and
Director, PMFS; Director, PMF
Richard A. Redeker President, Chief President, Chief Executive
Executive Officer and Officer and Director, PMF;
Director Executive Vice President,
Director and Member of
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, Senior
Senior Counsel and Counsel and Assistant
Assistant Secretary Secretary, PMF; Senior Vice
President and Senior Counsel,
Prudential Securities
(ii) 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 07102.
NAME AND ADDRESS POSITION WITH PMF PRINCIPAL OCCUPATIONS
- ---------------- ----------------- ---------------------
William M. Bethke Senior Vice President Senior Vice President,
Two Gateway Center Prudential; Senior Vice
Newark, NJ 07102 President, PIC
John D. Brookmeyer, Jr. Senior Vice President Senior Vice President,
51 JFK Parkway and Director Prudential; Senior Vice
Short Hills, NJ 07078 President and Director, PIC
Barry M. Gillman Director Director, PIC
Theresa A. Hamacher Vice President Vice President, Prudential;
Vice President, PIC;
Director, PMF
C-4
<PAGE>
NAME AND ADDRESS POSITION WITH PMF PRINCIPAL OCCUPATIONS
- ---------------- ----------------- ---------------------
Harry E. Knapp, Jr. President, Chairman of President, Chairman of the
the Board, Chief Board, Chief Executive
Executive Officer, Officer and Director, PIC;
and Director Vice President, Prudential
William P. Link Senior Vice President Executive Vice President,
Four Gateway Center Prudential; Senior Vice
Newark, NJ 07102 President, PIC
Richard A. Redeker Executive Vice President, Chief Executive
One Seaport Plaza President Officer and Director, PMF;
New York, NY 10292 Executive Vice President,
Director and Member of
Operating Committee,
Prudential Securities;
Director, PSG; Executive
Vice President, PIC;
Director,PMFD; Director,
PMFS
Eric A. Simonson Vice President and Vice President and Director,
Director PIC; Executive Vice
President, Prudential
Claude J. Zinngrabe, Jr. Executive Vice Executive Vice President, PIC;
President Vice President, Prudential
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. and The
Target Portfolio Trust, and for Class B and Class C shares of The BlackRock
Government Income Trust, Global Utility Fund, Inc., Nicholas-Applegate Fund,
Inc. (Nicholas-Applegate Growth Equity Fund), 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
Limited Maturity Fund, Inc., Prudential Global Natural Resources Fund, Inc.,
Prudential Government Income Fund, Inc., Prudential Growth Opportunity Fund,
Inc., Prudential High Yield Fund, Inc., Prudential Intermediate Global Income
Fund, Inc., Prudential Mortgage 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
Structured Maturity Fund, Inc., Prudential U.S. Government Fund and Prudential
Utility Fund, Inc. Prudential Securities is also a depositor for the following
unit investment trusts:
The 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, Inc. is distributor for Command
Government Fund, Command Money Fund, Command Tax-Free Fund, Prudential
California Municipal Fund (California Money Market Series), Prudential
Government Securities Trust (Money Market Series and U.S. Treasury Money Market
Series), Prudential Institutional Liquidity Portfolio, Inc., Prudential-Bache
MoneyMart Assets Inc. (d/b/a Prudential MoneyMart Assets), Prudential Municipal
Series Fund (Connecticut Money Market Series, Massachusetts Money Market Series,
New York Money Market Series and New Jersey Money Market Series),
Prudential-Bache Special Money Market Fund, Inc. (d/b/a Prudential Special Money
Market Fund), Prudential Tax-Free Money Fund, Inc. and for Class A shares of The
BlackRock Government Income Trust, Global Utility Fund, Inc., Nicholas-Applegate
Fund, Inc. (Nicholas-Applegate Growth Equity Fund), Prudential Allocation Fund,
Prudential California Municipal Fund (California Income Series and California
Series), Prudential Diversified Bond Fund, Inc., Prudential Equity Fund, Inc.,
Prudential Equity
C-5
<PAGE>
Income Fund, Prudential Europe Growth Fund, Inc., Prudential Global Fund,
Inc., Prudential Global Genesis Fund, Inc., Prudential Global Limited Maturity
Fund, Inc., Prudential Global Natural Resources Fund, Inc., Prudential
Government Income Fund, Inc., Prudential Growth Opportunity Fund, Inc.,
Prudential High Yield Fund, Inc., Prudential Intermediate Global Income Fund,
Inc., Prudential Mortgage Income Fund, Inc., Prudential Multi-Sector Fund, Inc.,
Prudential Municipal Bond Fund, Prudential Municipal Series Fund (Florida
Series, Hawaii Income Series, Maryland Series, Massachusetts Series, Michigan
Series, New Jersey Series, North Carolina Series, Ohio Series and Pennsylvania
Series), Prudential National Municipals Fund, Inc., Prudential Pacific Growth
Fund, Inc., Prudential Structured Maturity Fund, Inc., Prudential U.S.
Government Fund and Prudential Utility Fund, Inc.
(b)(i) Information concerning directors and officers of Prudential
Securities Incorporated is set forth below.
Positions and Positions and
Offices with Offices with
Name(1) Underwriter Registrant
- ------- ------------- -------------
Robert Golden .......... Executive Vice President and Director None
One New York Plaza
New York, NY
Alan D. Hogan .......... Executive Vice President, Chief
Administrative Officer and Director None
George A. Murray ....... Executive Vice President and Director None
Leland B. Paton ........ Executive Vice President and Director None
One New York Plaza
New York, NY
Martin Pfinsgraff ...... Executive Vice President, Chief
Financial Officer and Director None
Vincent T. Pica, II .... Executive Vice President and Director None
One New York Plaza
New York, NY
Richard A. Redeker ..... Director President
and Director
Hardwick Simmons ....... Chief Executive Officer, President
and Director None
Lee B. Spencer, Jr. .... Executive Vice President, General
Counsel, Secretary and Director None
(b)(ii) Information concerning the officers and directors of Prudential
Mutual Fund Distributors, Inc. is set forth below.
NAME(1)
- -------
Joanne Accurso-Soto .... Vice President None
Dennis N. Annarumma .... Vice President, Assistant Treasurer
and Assistant Comptroller None
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 and Director None
Robert F. Gunia ........ Executive Vice President, Chief
Financial Officer, Treasurer
and Director Vice
President
Timothy J. O'Brien ..... President, Chief Executive Officer,
Raritan Plaza One Chief Operating Officer and Director None
Edison, NJ
C-6
<PAGE>
POSITIONS AND POSITIONS AND
OFFICES WITH OFFICES WITH
NAME(1) UNDERWRITER REGISTRANT
- ------- ------------- -------------
Richard A. Redeker ......... Director President
and Director
Andrew J. Varley ........... Vice President None
Raritan Plaza One
Edison, NJ
- --------------
(1) The address of each person named is One Seaport Plaza, New York, NY 10292
unless otherwise indicated.
(c) Registrant has no principal underwriter who is not an affiliated person
of the Registrant.
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, One Heritage Drive, North
Quincy, Massachusetts, The Prudential Investment Corporation, Prudential Plaza,
745 Broad Street, Newark, New Jersey, the Registrant, One Seaport Plaza, New
York, New York, and Prudential Mutual Fund Services, Inc., Raritan Plaza One,
Edison, New Jersey. Documents required by Rules 31a-1(b)(5), (6), (7), (9), (10)
and (11) and 31a-1(f) will be kept at Three 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-7
<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 20th day of December, 1995.
PRUDENTIAL MULTI-SECTOR FUND, INC.
By: /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.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ SUSAN C. COTE Treasurer and Principal Financial December 20, 1995
- ----------------------------- and Accounting Officer
SUSAN C. COTE
/s/ EDWARD D. BEACH Director December 20, 1995
- -----------------------------
EDWARD D. BEACH
/s/ DONALD D. LENNOX Director December 20, 1995
- -----------------------------
DONALD D. LENNOX
/s/ DOUGLAS H. MCCORKINDALE Director December 20, 1995
- -----------------------------
DOUGLAS H. MCCORKINDALE
/s/ THOMAS T. MOONEY Director December 20, 1995
- -----------------------------
THOMAS T. MOONEY
/s/ RICHARD A. REDEKER President and Director December 20, 1995
- -----------------------------
RICHARD A. REDEKER
/s/ LOUIS A. WEIL, III Director December 20, 1995
- -----------------------------
LOUIS A. WEIL, III
</TABLE>
<PAGE>
EXHIBIT INDEX
-------------
<TABLE>
<CAPTION>
EXHIBITS DESCRIPTION PAGE NO.
- -------- ----------- --------
<S> <C>
1. Articles of Restatement. Incorporated by reference to Exhibit No. 1 to
Post-Effective Amendment No. 8 to the Registration Statement on Form N-1A
filed via EDGAR on June 29, 1995 (File No. 33-33477).
2. By-Laws of the Registrant. Incorporated by reference to Exhibit No. 2 to
the Registration Statement on Form N-1A filed on February 23, 1990 (File
No. 33-33477).
4. (a) Specimen certificate for Class A shares of common stock, $.001 par
value, of the Registrant. Incorporated by reference to Exhibit No. 4(a) to
Post-Effective Amendment No. 1 to the Registration Statement on Form N-1A
filed on November 30, 1990 (File No. 33-33477).
(b) Specimen certificate for Class B shares of common stock, $.001 par
value, of the Registrant. Incorporated by reference to Exhibit No. 4(b) to
Post-Effective Amendment No. 1 to the Registration Statement on Form N-1A
filed on November 30, 1990 (File No. 33-33477).
(c) Instruments defining rights of shareholders. Incorporated by reference
to Exhibits 1 and 2.
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. 1 to the Registration Statement on Form N-1A
filed on November 30, 1990 (File No. 33-33477).
(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. 1 to the Registration
Statement on Form N-1A filed on November 30, 1990 (File No. 33-33477).
6. (a) Distribution Agreement for Class A shares. Incorporated by reference to
Exhibit No. 6(a) to Post-Effective Amendment No. 8 to the Registration
Statement on Form N-1A filed via EDGAR on June 29, 1995 (File No. 33-33477).
(b) Distribution Agreement for Class B shares. Incorporated by reference to
Exhibit No. 6(b) to Post-Effective Amendment No. 8 to the Registration
Statement on Form N-1A filed via EDGAR on June 29, 1995 (File No.
33-33477).
(c) Distribution Agreement for Class C shares. Incorporated by reference to
Exhibit No. 6(c) to Post-Effective Amendment No. 8 to the Registration
Statement on Form N-1A filed via EDGAR on June 29, 1995 (File No.
33-33477).
(d) Form of Distribution Agreement for Class Z shares. Incorporated by
reference to Exhibit No. 6(d) to Post-Effective Amendment No. 9 to the
Registration Statement on Form N-1A filed via EDGAR on October 30, 1995
(File No. 33-33477).
8. Custodian Contract between the Registrant and State Street Bank and Trust
Company. Incorporated by reference to Exhibit No. 8 to Post-Effective
Amendment No. 1 to the Registration Statement on Form N-1A filed on
November 30, 1990 (File No. 33-33477).
9. Transfer Agency and Service Agreement between the Registrant and Prudential
Mutual Fund Services, Inc. Incorporated by reference to Exhibit No. 9 to
Post-Effective Amendment No. 1 to the Registration Statement on Form N-1A
filed on November 30, 1990 (File No. 33-33477).
10. (a) Opinion of Counsel. Incorporated by reference to Exhibit No. 10 to
Pre-Effective Amendment No. 2 to the Registration Statement on Form N-1A
filed on May 21, 1990 (File No. 33-33477).
(b) Opinion of Counsel. Incorporated by reference to Exhibit No. 10(b) to
Post-Effective Amendment No. 4 to the Registration Statement on Form N-1A
filed on June 30, 1993 (File No. 33-33477).
11. Consent of Independent Accountants.*
13. Purchase Agreement. Incorporated by reference to Exhibit No. 13 to
Pre-Effective Amendment No. 2 to the Registration Statement on Form N-1A
filed on May 21, 1990 (File No. 33-33477).
- ----------------
*Filed herewith.
</TABLE>
<PAGE>
EXHIBIT INDEX--CONTINUED
------------------------
<TABLE>
<CAPTION>
EXHIBITS DESCRIPTION PAGE NO.
- -------- ----------- --------
<S> <C>
15. (a) Distribution and Service Plan for Class A shares. Incorporated by
reference to Exhibit No. 15(a) to Post-Effective Amendment No. 8 to the
Registration Statement on Form N-1A filed via EDGAR on June 29, 1995 (File
No. 33-33477).
(b) Distribution and Service Plan for Class B shares. Incorporated by
reference to Exhibit No. 15(b) to Post-Effective Amendment No. 8 to the
Registration Statement on Form N-1A filed via EDGAR on June 29, 1995
(File No. 33-33477).
(c) Distribution and Service Plan for Class C shares. Incorporated by
reference to Exhibit 15(c) to Post-Effective Amendment No. 8 to the
Registration Statement on Form N-1A filed via EDGAR on June 29, 1995
(File No. 33-33477).
16. (a) Schedule of Computation of Performance Quotations (Class A Shares).
Incorporated by reference to Exhibit No. 16(a) to Post-Effective Amendment
No. 1 to the Registration Statement on Form N-1A filed on November 30, 1990
(File No. 33-33477).
(b) Schedule of Computation of Performance Quotations (Class B Shares).
Incorporated by reference to Exhibit No. 16(b) to Post-Effective Amendment
No. 1 to the Registration Statement on Form N-1A filed on November 30, 1990
(File No. 33-33477).
18. Rule 18f-3 Plan. Incorporated by reference to Exhibit No. 18 to
Post-Effective Amendment No. 9 to the Registration Statement on Form N-1A
filed via EDGAR on October 30, 1995 (File No. 33-33477).
27. Financial Data Schedules.*
Other Exhibits
Powers of Attorney for
Edward D. Beach
Donald D. Lennox
Douglas H. McCorkindale
Thomas T. Mooney
Louis A. Weil, III
Executed copies filed under Other Exhibits to Pre-Effective Amendment No. 2 to
the Registration Statement on Form N-1A (File No. 33-33477) filed on May 21,
1990.
- ----------------
* Filed herewith.
</TABLE>
Exhibit 11
CONSENT OF INDEPENDENT AUDITORS
We consent to the use in Post-Effective Amendment No. 10 to Registration
Statement No. 33-33477 of Prudential Multi-Sector Fund, Inc. of our report dated
June 15, 1995, appearing in the Statement of Additional Information, which is
incorporated by reference in such Registration Statement, and to the references
to us under the headings "Financial Highlights" in the Prospectus, which is
incorporated by reference in such Registration Statement, and "Custodian,
Transfer and Dividend Disbursing Agent and Independent Accountants" in the
Statement of Additional Information.
Deloitte & Touche LLP
New York, New York
December 20, 1995
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000860916
<NAME> PRUDENTIAL MULTI-SECTOR FUND
<SERIES>
<NUMBER> 001
<NAME> PRUDENTIAL MULTI-SECTOR FUND (CLASS A)
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> APR-30-1995
<PERIOD-END> OCT-31-1995
<INVESTMENTS-AT-COST> 410,421,386
<INVESTMENTS-AT-VALUE> 470,470,993
<RECEIVABLES> 11,318,335
<ASSETS-OTHER> 11,000,366
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 492,789,694
<PAYABLE-FOR-SECURITIES> 3,079,491
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 12,037,216
<TOTAL-LIABILITIES> 15,116,707
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 386,309,688
<SHARES-COMMON-STOCK> 33,833,598
<SHARES-COMMON-PRIOR> 19,874,878
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 49,037
<ACCUMULATED-NET-GAINS> 30,978,681
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 60,335,581
<NET-ASSETS> 477,672,987
<DIVIDEND-INCOME> 2,286,656
<INTEREST-INCOME> 1,310,477
<OTHER-INCOME> 0
<EXPENSES-NET> 3,327,132
<NET-INVESTMENT-INCOME> 270,001
<REALIZED-GAINS-CURRENT> 32,912,628
<APPREC-INCREASE-CURRENT> 46,356,445
<NET-CHANGE-FROM-OPS> 79,539,074
<EQUALIZATION> 569,551
<DISTRIBUTIONS-OF-INCOME> (270,001)
<DISTRIBUTIONS-OF-GAINS> (13,697,937)
<DISTRIBUTIONS-OTHER> (165,971)
<NUMBER-OF-SHARES-SOLD> 211,272,030
<NUMBER-OF-SHARES-REDEEMED> (77,925,453)
<SHARES-REINVESTED> 13,255,569
<NET-CHANGE-IN-ASSETS> 212,576,862
<ACCUMULATED-NII-PRIOR> 22,179
<ACCUMULATED-GAINS-PRIOR> 11,387,268
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,326,851
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3,327,132
<AVERAGE-NET-ASSETS> 182,399,000
<PER-SHARE-NAV-BEGIN> 13.45
<PER-SHARE-NII> 0.04
<PER-SHARE-GAIN-APPREC> 1.47
<PER-SHARE-DIVIDEND> (0.02)
<PER-SHARE-DISTRIBUTIONS> (0.71)
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 14.23
<EXPENSE-RATIO> 1.16
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.00
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000860916
<NAME> PRUDENTIAL MULTI-SECTOR FUND
<SERIES>
<NUMBER> 002
<NAME> PRUDENTIAL MULTI-SECTOR FUND (CLASS B)
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> APR-30-1995
<PERIOD-END> OCT-31-1995
<INVESTMENTS-AT-COST> 410,421,386
<INVESTMENTS-AT-VALUE> 470,470,993
<RECEIVABLES> 11,318,335
<ASSETS-OTHER> 11,000,366
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 492,789,694
<PAYABLE-FOR-SECURITIES> 3,079,491
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 12,037,216
<TOTAL-LIABILITIES> 15,116,707
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 386,309,688
<SHARES-COMMON-STOCK> 33,833,598
<SHARES-COMMON-PRIOR> 19,874,878
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 49,037
<ACCUMULATED-NET-GAINS> 30,978,681
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 60,335,581
<NET-ASSETS> 477,672,987
<DIVIDEND-INCOME> 2,286,656
<INTEREST-INCOME> 1,310,477
<OTHER-INCOME> 0
<EXPENSES-NET> 3,327,132
<NET-INVESTMENT-INCOME> 270,001
<REALIZED-GAINS-CURRENT> 32,912,628
<APPREC-INCREASE-CURRENT> 46,356,445
<NET-CHANGE-FROM-OPS> 79,539,074
<EQUALIZATION> 569,551
<DISTRIBUTIONS-OF-INCOME> (270,001)
<DISTRIBUTIONS-OF-GAINS> (13,697,937)
<DISTRIBUTIONS-OTHER> (165,971)
<NUMBER-OF-SHARES-SOLD> 211,272,030
<NUMBER-OF-SHARES-REDEEMED> (77,925,453)
<SHARES-REINVESTED> 13,255,569
<NET-CHANGE-IN-ASSETS> 212,576,862
<ACCUMULATED-NII-PRIOR> 22,179
<ACCUMULATED-GAINS-PRIOR> 11,387,268
<OVERDISTRIB-NII-PRIOR> 0
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<NAME> PRUDENTIAL MULTI-SECTOR FUND
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<NAME> PRUDENTIAL MULTI-SECTOR FUND (CLASS C)
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