Name
Address
Address


                 PRINCIPAL TAX-EXEMPT CASH MANAGEMENT FUND, INC.

                           Des Moines, Iowa 50392-0200
                                 (800) 944-8454
                                  ------------

                   PROXY FOR A SPECIAL MEETING OF SHAREHOLDERS
                                  April 7, 1999

         This  proxy is  solicited  on behalf of the Board of  Directors  of the
Fund. The undersigned  shareholder  appoints Arthur S. Filean,  Ernest H. Gillum
and  Michael  J.  Beer,  and each of them  separately,  Proxies,  with  power of
substitution, and authorizes them to represent and to vote as designated on this
ballot,  at the meeting of  shareholders of the Fund to be held April 7, 1999 at
2:00 p.m., CDT, and at any adjournments thereof, all the shares of the Fund that
the undersigned shareholder would be entitled to vote if personally present.

         Check the appropriate  box below on this ballot,  date and sign exactly
as your name  appears.  Your  signature  acknowledges  receipt  of Notice of the
Special Meeting of Shareholders  and  Prospectus/Proxy  Statement dated March 1,
1999.  Shares will be voted as you instruct.  If no direction is made, the proxy
will be voted FOR the proposal  listed below.  In their  discretion  the Proxies
will also be  authorized  to vote upon such other matters that may properly come
before the meeting.

     NOTE: PLEASE SIGN EXACTLY AS YOUR NAME APPEARS ON THIS BALLOT. PLEASE MARK,
SIGN, DATE AND MAIL YOUR PROXY BALLOT IN THE ENCLOSED POSTAGE-PAID  ENVELOPE. If
shares are held jointly, either party may sign. If executed by a corporation, an
authorized officer must sign.  Executors,  administrators and trustees should so
indicate when signing. As an alternative to mailing,  you may fax a copy of your
proxy ballot to (515)235-9235  (this is not a toll-free  number) or you may call
toll-free (800)944-8454.

     The Board of Directors  recommends that shareholders vote FOR the following
proposal.  Please make your choice below in blue or black ink. Example: {X} Sign
the proxy ballot and return it as soon as possible in the enclosed envelope.


         Name                                   Account#
         Name                                   Shares:
         Address
         Address






         1. Approval of the Agreement and Plan of  Acquisition  among  Principal
Tax-Exempt Cash Management Fund, Inc.,  Principal Cash Management Fund, Inc. and
Principal  Management  Corporation,  and the transaction  contemplated  thereby,
pursuant  to which the Cash  Management  Fund would  acquire  all the assets and
assume all the  liabilities of the Tax-Exempt  Fund and issue in exchange shares
of its Class A commmon stock,  and the Tax-Exempt  Fund would  distribute  those
shares to its shareholders and then dissolve.


FOR  [  ]                 AGAINST  [  ]              ABSTAIN  [  ]



- -----------------     ---------------------------      -----------------, 1999
Signature             Signature (if held jointly)           Date