<Page>
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14a INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
<Table>
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/X/ Preliminary Proxy Statement
/ / Confidential, For Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Under Rule 14a-12
</Table>
<Table>
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-2
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-10
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-11
- ----------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
N/A
- ----------------------------------------------------------------------------
(Name of Person(s)Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction
applies:
------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which the filing fee is calculated and state how
it was determined):
------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------
/ / Fee paid previously with preliminary materials:
Check box if any part of the fee is offset as provided by
/ / Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the form or schedule
and the date of its filing.
(1) Amount previously paid:
------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------
</Table>
<Page>
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-2
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-10
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-11
PRUDENTIAL RETIREMENT SERVICES
30 SCRANTON OFFICE PARK
SCRANTON, PA 18507-1789
------------------------
IMPORTANT PROXY MATERIALS
PLEASE VOTE NOW!
MAY , 2003
------------------------
Dear Contractholder/Participant:
I am inviting you to vote on two proposals relating to the management and
operation of your Account(s). A special meeting of persons having voting rights
with respect to each of the Accounts is scheduled for July 17, 2003. This
package contains information about the proposals and includes materials you will
need to vote.
The Committee of each Account has reviewed the proposals and has recommended
that the proposals be presented to you for consideration. Although the Committee
Members have determined that the proposals are in your best interest, the final
decision is yours.
Contractholders/Participants of each Account are being asked to approve
substantially the same proposals, so in order to save money, one proxy statement
has been prepared for all of the Accounts listed above. To help you understand
the proposals, we are including a section that answers commonly asked questions.
The accompanying proxy statement includes a detailed description of the
proposals.
Please read the enclosed materials carefully and cast your vote. Remember,
your vote is extremely important, no matter how large or small your holdings. By
voting now, you can help avoid additional costs that are incurred with follow-up
letters and calls.
TO VOTE, YOU MAY USE ANY OF THE FOLLOWING METHODS:
- BY MAIL. Please complete, date and sign your proxy card(s) before
mailing it (or them) in the enclosed postage-paid envelope.
- BY INTERNET. Have your proxy card(s) available. Go to the web site:
www.proxyweb.com. Enter your control number from your proxy card(s).
Follow the simple instructions found on the web site.
- BY TELEPHONE. Call 1-800-690-6903 toll free (phone line is available 24
hours a day).
- IN PERSON. By attending the meeting and voting your shares.
If you have any questions before you vote, please call us at 1-888-778-2888
from 8:00 a.m. to 8:00 p.m. Eastern Time, Monday through Friday. We're glad to
help you understand the proposal and assist you in voting. Thank you for your
participation.
Sincerely,
/s/ Judy A. Rice
<Page>
Judy A. Rice
PRESIDENT
<Page>
IMPORTANT INFORMATION TO HELP YOU UNDERSTAND AND VOTE ON THE PROPOSALS
Please read the enclosed proxy statement for a complete description of the
proposals. However, as a quick reference, the following questions and answers
provide a brief overview of the proposals.
Q. WHAT PROPOSALS AM I BEING ASKED TO VOTE ON?
A. The purpose of the proxy is to ask you to elect a new Committee for the
Accounts and to vote on the approval of changes to the Accounts'
fundamental investment restrictions.
Q. WHY AM I RECEIVING PROXY INFORMATION FOR AN ACCOUNT IN WHICH I DO NOT HAVE
AN INVESTMENT?
A. Contractholders/Participants of all of the Accounts are being asked to
approve substantially the same proposals, so most of the information that
must be included in a proxy statement for your Account must be included in
a proxy statement for the other Accounts as well. Therefore, in order to
save money, one proxy statement has been prepared.
Q. ARE YOU RECOMMENDING A NEW COMMITTEE FOR THE ACCOUNTS?
A. Yes. The current Committee of each Account has nominated for election a
new, larger Committee, including eight Independent Committee Members and
two Interested Committee Members. All of the nominees already serve as
directors or trustees on some funds in the Prudential mutual fund complex,
although they do not currently serve as Committee Members for the Accounts.
Q. WILL THE PROPOSALS RESULT IN HIGHER COMMITTEE MEMBER FEES TO BE PAID BY THE
ACCOUNTS?
A. No. Under the Accounts' Management Agreements, the Accounts' Manager,
Prudential Investments LLC, or its affiliates pay the fees and expenses for
the Committee Members.
Q. WHAT ARE "FUNDAMENTAL" INVESTMENT RESTRICTIONS, AND WHY ARE THEY PROPOSED TO
BE CHANGED?
A. "Fundamental" investment restrictions are limitations placed on the
Accounts' investment policies that can be changed only by a vote of
Contractholders/Participants, even if the changes are minor. The law
requires certain investment policies to be designated as fundamental. Each
Account adopted a number of fundamental investment restrictions, and some
of those fundamental restrictions reflect regulatory, business or industry
conditions, practices or requirements that are no longer in effect. Others
reflect regulatory requirements that, while still in effect, do not need to
be classified as fundamental restrictions. The Committee believes that
certain fundamental investment restrictions that are not legally required
should be eliminated. The Committee also believes that
<Page>
other fundamental restrictions should be modernized, made more uniform and
provide greater investment flexibility for the Account.
Q. DO THE PROPOSED CHANGES TO FUNDAMENTAL INVESTMENT RESTRICTIONS MEAN THAT THE
ACCOUNTS' INVESTMENT OBJECTIVES ARE BEING CHANGED?
A. No.
Q. WHAT WOULD BE THE EFFECT OF THE PROPOSED CHANGES TO THE ACCOUNTS' INVESTMENT
FUNDAMENTAL RESTRICTIONS?
A. The Committee does not believe that the proposed changes to fundamental
investment restrictions will result in any major changes to the Accounts'
investment portfolios. The changes will allow the Accounts greater
flexibility to respond to investment opportunities and permit the Committee
to make changes in the future that it considers desirable without the
necessity of a Contractholder/Participant vote and the related additional
expenses. A Contractholder/Participant vote is not necessary for changes to
non-fundamental investment policies or restrictions.
Q. HOW MANY VOTES DO YOU NEED TO APPROVE THESE PROPOSALS?
A. The number of votes needed to approve each proposal differs, due to
different requirements imposed by federal law and the Accounts' rules and
regulations. The description of each proposal identifies the number of
votes required for approval of each proposal.
Q. WHAT IF YOU DO NOT HAVE ENOUGH VOTES TO MAKE THIS DECISION BY THE SCHEDULED
MEETING DATE?
A. If we do not receive sufficient votes to hold a Meeting, we or Georgeson
Shareholder Communications Inc., the proxy solicitation firm, may contact
you by mail or telephone to encourage you to vote.
Contractholders/Participants should review the proxy materials and cast
their vote to avoid additional mailings or telephone calls. If we do not
have enough votes to approve the proposals by the time of the meeting, the
meeting may be adjourned to permit further solicitation of proxy votes.
Q. WILL THE PROPOSED CHANGES RESULT IN HIGHER MANAGEMENT FEES?
A. No.
Q. HAS THE COMMITTEE OF EACH ACCOUNT APPROVED THE PROPOSALS?
A. Yes. Each Account's Committee has approved the proposals and recommends
that you vote to approve the proposals.
<Page>
Q. HOW MANY VOTES AM I ENTITLED TO CAST?
A. You are entitled to one vote for each dollar in your individual
accumulation account(s) in each Account as of the record date. The record
date is May 2, 2003.
Q. HOW DO I VOTE?
A. YOU CAN VOTE BY COMPLETING AND SIGNING THE ENCLOSED PROXY CARD(S), AND
MAILING IT IN THE ENCLOSED POSTAGE PAID ENVELOPE. YOU HAVE RECEIVED ONE
PROXY CARD FOR EACH ACCOUNT IN WHICH YOU HAD AN INTEREST ON THE RECORD
DATE. IF YOU NEED ANY ASSISTANCE, OR HAVE ANY QUESTIONS REGARDING THE
PROPOSAL OR HOW TO VOTE YOUR SHARES, PLEASE CALL PRUDENTIAL AT
1-888-778-2888.
You may also vote via the Internet. To do so, have your proxy card available
and go to the web site: www.proxyweb.com. Enter your control number from
your proxy card and follow the instructions found on the web site.
Finally, you can vote by telephone. Call 1-800-690-6903 toll free. This
phone line is available 24 hours a day.
Q. HOW DO I SIGN THE PROXY CARD?
A. INDIVIDUAL ACCOUNTS: Each person should sign exactly as his or her name
appears on the proxy card.
JOINT ACCOUNTS: Both owners must sign and the signatures should conform
exactly to the names shown on the proxy card.
ALL OTHER ACCOUNTS: The person signing must indicate his or her capacity.
For example, a trustee for a trust should include his or her title when he
or she signs, such as "Jane Doe, Trustee"; or an authorized officer of a
company should indicate his or her position with the company, such as "John
Smith, President."
The attached proxy statement contains more detailed information about each of
the proposals. Please read it carefully.
<Page>
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-2
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-10
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-11
PRUDENTIAL RETIREMENT SERVICES
30 SCRANTON OFFICE PARK
SCRANTON, PA 18507-1789
------------------------
NOTICE OF SPECIAL MEETINGS
OF PERSONS HAVING VOTING RIGHTS
TO BE HELD ON
JULY 17, 2003
------------------------
Dear Contractholder/Participant:
You are hereby notified that each of the above-listed Accounts will hold a
Special Meeting of persons having voting rights with respect to the Account in
the offices of The Prudential Insurance Company of America, Gateway Center
Three, 100 Mulberry Street, 14th Floor, Newark, New Jersey on July 17, 2003 at
10:00 a.m. Eastern Daylight time for the purpose of considering and acting upon
the following proposals:
1. To elect 10 Committee Members for each Account; and
2. To approve changes to each Account's fundamental investment restrictions.
You are entitled to vote at the Meeting, and at any adjournments thereof, of
each Account in which you had an interest at the close of business on May 2,
2003. If you attend a Meeting, you may vote your interest in person. IF YOU DO
NOT EXPECT TO ATTEND A MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN THE
ENCLOSED PROXY CARD(S) IN THE ENCLOSED POSTAGE PAID ENVELOPE OR VOTE BY INTERNET
OR TELEPHONE.
By order of the Committee,
/s/ Jonathan D. Shain
Jonathan D. Shain
SECRETARY
Dated: May , 2003
ONE OR MORE PROXY CARDS ARE ENCLOSED ALONG WITH THE PROXY STATEMENT. PLEASE VOTE
TODAY BY SIGNING AND RETURNING THE PROXY CARD(S) IN THE POSTAGE PREPAID ENVELOPE
PROVIDED. YOU CAN ALSO VOTE THROUGH THE INTERNET OR BY TELEPHONE USING THE
"CONTROL" NUMBER THAT APPEARS ON THE PROXY CARD AND FOLLOWING THE SIMPLE
INSTRUCTIONS. THE COMMITTEE OF EACH ACCOUNT RECOMMENDS THAT YOU VOTE "FOR" THE
PROPOSALS.
<Page>
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-2
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-10
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT-11
PRUDENTIAL RETIREMENT SERVICES
30 SCRANTON OFFICE PARK
SCRANTON, PA 18507-1789
------------------------
PROXY STATEMENT
SPECIAL MEETING OF PERSONS HAVING VOTING RIGHTS
TO BE HELD ON JULY 17, 2003
------------------------
This proxy statement is being furnished to persons having voting rights with
respect to each of the Accounts listed above in connection with the solicitation
by the Committee of each Account of proxies to be used at a Special Meeting of
each Account to be held at Gateway Center Three, 100 Mulberry Street, 14th
Floor, Newark, New Jersey 07102 on July 17, 2003, at 10:00 a.m., Eastern
Daylight time, or any adjournment or adjournments thereof. The Meetings of each
Account will be held together, but voting will be separately by Account. This
proxy statement is being first mailed to persons having voting rights on or
about May , 2003.
Each Account is a separate account of The Prudential Insurance Company of
America ("Prudential Insurance") and is a registered, management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act").
Ownership interests in each Account are referred to as "Units," and the persons
having voting rights with respect to the Account are
"Contractholders/Participants." The Committee of each Account, which serves the
same function as a mutual fund's board of directors, is referred to as the
"Committee," and the individuals serving on the Committee are "Committee
Members." Currently, each Account has the same Committee Members. As explained
below, the nominees for election to the Committees are the same for each
Account.
Prudential Investments LLC ("PI" or the "Manager"), Gateway Center Three,
100 Mulberry Street, Newark, New Jersey 07102, serves as each Account's Manager
under management agreements with the Accounts (the "Management Agreements").
Investment advisory services are provided to The Prudential Variable Contract
Account-2 ("VCA-2") and The Prudential Variable Contract Account-10 ("VCA-10")
under Subadvisory Agreements with Jennison Associates LLC ("Jennison"), 466
Lexington Avenue, New York, New York 10017. Investment advisory services are
provided to The Prudential Variable Contract Account-11 ("VCA-11") under a
Subadvisory Agreement with Prudential Investment Management, Inc. ("PIM" and,
collectively with Jennison, the "Subadvisers"), Gateway Center Three, 100
Mulberry Street, Newark, New Jersey 07102. PI, Jennison and PIM are wholly-
<Page>
owned indirect subsidiaries of Prudential Financial, Inc. ("Prudential").
Prudential Investment Management Services LLC ("PIMS" or the "Distributor"),
Gateway Center Three, 100 Mulberry Street, Newark, New Jersey 07102, serves as
the distributor of the contracts issued in connection with the Account. PIMS is
also a wholly-owned indirect subsidiary of Prudential. As of December 31, 2002,
PI served as the investment manager to all of the Prudential U.S. and offshore
open-end investment companies, and as the administrator to certain closed-end
investment companies, with aggregate assets of approximately $86.1 billion. Each
Account has a Committee which, in addition to overseeing the actions of the
Account's Manager and Subadviser, decides upon matters of general policy. The
Committee serves the same function as a mutual fund board of directors.
VOTING INFORMATION
Under most Section 403(b) plans, Participants have voting rights in the
Accounts, and this proxy statement will be sent to them. Under some qualified
plans, the Contractholder will have the voting rights. In general, for qualified
plans with a trustee, we will send the proxy statement to the Contractholder so
it can determine whether the plan provides for voting by the Contractholder or
the Participants.
Voting rights are determined as of the close of business on the record date
of May 2, 2003. The person having voting rights is entitled to the number of
votes and fractions thereof equal to the number of dollars and fractions thereof
in the individual accumulation account(s) in each Account. Prudential is
entitled to vote Units representing its own funds invested in each Account as of
the record date. For each Account, Prudential will cast its votes in the same
proportions as all other persons having voting rights represented at the Meeting
in person or by proxy. For example, if 90% of votes received from persons having
voting rights in a particular Account are in favor of a Proposal, Prudential
will cast 90% of its votes in that Account in favor of the Proposal. The table
below provides information regarding the outstanding voting rights as of the
record date.
<Table>
<Caption>
DOLLAR VALUE OF
UNITS DOLLAR VALUE OF UNITS HELD
ACCOUNT OUTSTANDING UNITS OUTSTANDING BY PRUDENTIAL
------- ----------- ----------------- ---------------
VCA-2
VCA-10
VCA-11
</Table>
The presence, in person or by proxy, of more than 35% of the votes which may
be cast will constitute a quorum for the transaction of business at each
Meeting. If a quorum is not present at a Meeting, or if a quorum is present at
that Meeting but sufficient votes to approve any of the Proposals are not
received, the persons named as proxies may propose one or more
2
<Page>
adjournments of the Meeting to permit further solicitation of proxies. Any
adjournment will require the affirmative vote of a majority of those Units
present and entitled to vote at the Meeting in person or by proxy. When voting
on a proposed adjournment, the persons named as proxies will vote those proxies
which they are entitled to vote FOR any Proposal in favor of the adjournment of
that Proposal and will vote those proxies required to be voted AGAINST any
Proposal against the adjournment of that Proposal. A vote may be taken on one or
more of the Proposals in this proxy statement prior to any such adjournment if
sufficient votes have been received and it is otherwise appropriate.
If a proxy that is properly executed and returned is accompanied by
instructions to withhold authority to vote (an abstention) or represents a
broker "non-vote" (that is, a proxy from a broker or nominee indicating that
such person has not received instructions from the beneficial owner or other
person entitled to vote on a particular matter with respect to which the broker
or nominee does not have discretionary power), the Units represented thereby,
with respect to matters to be determined by a plurality of the votes cast on
such matters (including proposed adjournments on such matters), will be
considered present for purposes of determining the existence of a quorum for the
transaction of business, but, not being cast, will have no effect on the outcome
of such matters. With respect to matters requiring the affirmative vote of a
specified percentage of the total dollar amount of individual accumulation
accounts in an Account (including proposed adjournments on such matters), an
abstention or broker non-vote will be considered present for purposes of
determining a quorum but will have the effect of a vote against such matters.
Accordingly, abstentions and broker non-votes will have no effect on Proposal
No. 1 (or proposed adjournments on Proposal No. 1), for which the required vote
is a plurality of the votes cast, but effectively will be a vote against
Proposal No. 2 (or proposed adjournments on Proposal No. 2), which requires
approval of a majority of the outstanding voting securities under applicable
law.
The individuals named as proxies on the enclosed proxy cards will vote in
accordance with your direction as indicated thereon if your card is received
properly executed by you or by your duly appointed agent or attorney-in-fact. If
your card is properly executed and you give no voting instructions, your Units
will be voted FOR the Proposals. If any nominee for the Committee should
withdraw or otherwise become unavailable for election, your Units will be voted
in favor of such other nominee or nominees as the Manager may recommend. You may
revoke any proxy card by giving another proxy or by letter or telegram revoking
the initial proxy. To be effective your revocation must be received by the
Account prior to a Meeting and must indicate your name and account number. In
addition, if you attend a Meeting in person you may, if you wish, vote by ballot
at that Meeting, thereby canceling any proxy previously given.
3
<Page>
Contractholders/Participants may revoke their instructions, but to be
effective, Prudential must receive written notice of the revocation prior to
6 p.m. on July 10, 2003. Alternatively, Contractholders/Participants may attend
a Meeting and vote in person, in which case any prior instructions provided will
be revoked.
This solicitation is being made by mail, but it also may be made by
telephone or facsimile. Prudential will bear the cost of this solicitation.
COPIES OF EACH ACCOUNT'S MOST RECENT ANNUAL AND SEMI-ANNUAL REPORTS,
INCLUDING FINANCIAL STATEMENTS, HAVE PREVIOUSLY BEEN DELIVERED TO
CONTRACTHOLDERS/PARTICIPANTS. PERSONS HAVING VOTING RIGHTS MAY OBTAIN WITHOUT
CHARGE ADDITIONAL COPIES OF EACH ACCOUNT'S ANNUAL AND SEMI-ANNUAL REPORTS BY
WRITING US AT PRUDENTIAL RETIREMENT SERVICES, 30 SCRANTON OFFICE PARK, SCRANTON,
PA 18507-1789, OR BY CALLING (800) 458-6333 (TOLL FREE).
Contractholders/Participants voting via the Internet should understand that
there may be costs associated with electronic access, such as usage charges from
Internet access providers and telephone companies that must be borne by the
Contracholder/Participant.
PROPOSAL NO. 1
TO ELECT COMMITTEE MEMBERS
The current Committee of each Account has nominated the 10 individuals
identified below for election to the Committee for each Account. Pertinent
information about each nominee is set forth in the listing below. Each nominee
has indicated a willingness to serve if elected. Each nominee currently serves
as a director or trustee on some of the funds in the Prudential mutual fund
complex.
On May 1, 2003, Prudential acquired American Skandia, Inc. As part of the
transaction, PI became an investment adviser to the American Skandia Advisor
Funds, Inc. and the American Skandia Trust. Shareholders of the American Skandia
Advisor Funds, Inc. on April 3, 2003 elected as trustees each of the same
individuals who have been nominated to serve as Committee Members for the
Accounts. If Contractholders/Participants elect each of the nominees, a common
board/committee, consisting of the same individuals, will oversee and supervise
both the American Skandia Advisor Funds, Inc. and the Accounts. In addition,
shareholders of certain other investment companies advised by PI are also being
asked to elect these same individually as directors/ trustees for those
investment companies.
Each Account currently has four Committee Members, three of whom are not
"interested persons" of Prudential or the Accounts under the Federal securities
laws ("Independent Committee Members") and have been previously elected by
persons having voting rights. One of the current
4
<Page>
Independent Committee Members is currently scheduled to retire from the
Committees as of June 30, 2003. Each Committee has one member who is an
interested person of Prudential and the Account ("Interested Committee Member").
The current Committees believe that expanding the size of the Committees and
adding members who also serve as directors/trustees of other mutual funds in the
Prudential fund complex is in the best interests of the Accounts. The principal
reasons for electing these individuals as members are:
- to bring additional experience and diversity of viewpoints to the
Committees;
- to bring the benefit of experience derived from service on the boards of
other Prudential investment companies;
- to increase the number of Independent Committee Members in light of the
requirements of the Federal securities laws mandating that a majority of
the members be independent;
- to compensate for the fact that after the planned retirement of one
current Independent Committee Member as of June 30, 2003, the size of the
Committees would be smaller than desirable for the effective supervision
of the Accounts' business; and
- to achieve efficiencies and coordination in operation, supervision and
oversight of the Accounts, which may be derived from having the same
individuals serve on the board/committee of each of the Prudential retail
mutual funds and the Accounts.
If elected, the nominees will hold office generally without limit except
that (a) any Committee Member may resign; (b) any Committee Member may be
removed by a vote of three-fifths of the Committee Members then in office;
(c) any Committee Member may be removed by the holders of not less than
two-thirds of the Account's outstanding capital stock; and (d) the retirement
policy of each Account generally calls for the retirement of Committee Members
on December 31 of the year in which they reach the age of 75. In the event of a
vacancy on the Committee, the remaining Committee Members will fill such vacancy
by appointing another Committee Member, so long as immediately after such
appointment, at least two-thirds of the Committee Members have been elected by
Contractholders/Participants.
None of the nominees are related to one another. None of the Independent
Committee Members or persons nominated to become Independent Committee Members
owns shares of Prudential or its affiliates.
5
<Page>
The business experience and address of each nominee for Independent
Committee Member and each nominee for Independent Committee Member, as well as
information regarding their service on other mutual funds in the Prudential
mutual fund complex, is as follows:
PROPOSED INDEPENDENT COMMITTEE MEMBER NOMINEES
<Table>
<Caption>
NUMBER OF
PORTFOLIOS
IN FUND
COMPLEX OTHER
TERM OF OVERSEEN BY DIRECTORSHIPS**
NAME, POSITION(S) OFFICE AND NOMINEE FOR HELD BY NOMINEE
ADDRESS* HELD WITH LENGTH OF PRINCIPAL OCCUPATION(S) COMMITTEE FOR COMMITTEE
AND AGE THE ACCOUNTS TIME SERVED DURING PAST FIVE YEARS MEMBER MEMBER
- -----------------------------------------------------------------------------------------------------------
David E. A. Carson (68) None -- Director (January 2000 31 Director of
People's Bank to May 2000), Chairman United
1 Financial Plaza (January 1999 to Illuminating
Second Floor December 1999), and UIL
Hartford, CT 06103 Chairman and Chief Holdings, a
Executive Officer utility
(January 1998 to company, since
December 1998) and May 1993.
President, Chairman and
Chief Executive Officer
(1983 to December 1997)
of People's Bank.
- -----------------------------------------------------------------------------------------------------------
Robert E. La Blanc (69) None -- President (since 1981) 108 Director of
of Robert E. La Blanc Storage
Associates, Inc. Technology
(telecommunications); Corporation
formerly General (technology)
Partner at Salomon (since 1979),
Brothers and Chartered
Vice-Chairman of Semiconductor
Continental Telecom.; Manufacturing,
Trustee of Manhattan Ltd.
College. (Singapore)
(since 1998),
Titan
Corporation
(electronics,
since 1995),
Computer
Associates
International,
Inc. (since
2002) (software
company);
Director (since
1999) of First
Financial
Fund, Inc. and
Director (since
April 1999) of
The High Yield
Plus
Fund, Inc.
- -----------------------------------------------------------------------------------------------------------
</Table>
6
<Page>
<Table>
<Caption>
NUMBER OF
PORTFOLIOS
IN FUND
COMPLEX OTHER
TERM OF OVERSEEN BY DIRECTORSHIPS**
NAME, POSITION(S) OFFICE AND NOMINEE FOR HELD BY NOMINEE
ADDRESS* HELD WITH LENGTH OF PRINCIPAL OCCUPATION(S) COMMITTEE FOR COMMITTEE
AND AGE THE ACCOUNTS TIME SERVED DURING PAST FIVE YEARS MEMBER MEMBER
- -----------------------------------------------------------------------------------------------------------
Douglas H. McCorkindale None -- Chairman (since 108 Director of
(63) February 2001), Chief Gannett
Executive Officer Co., Inc.,
(since June 2000) and Director of
President (since Continental
September 1997) of Airlines, Inc.
Gannett Co. Inc. (since May
(publishing and media); 1993), Director
formerly Vice Chairman of Lockheed
(March 1984-May 2000) Martin Corp.
of Gannett Co. Inc. (aerospace and
defense) (since
May 2001);
Director of the
High Yield Plus
Fund, Inc.
(since 1996).
- -----------------------------------------------------------------------------------------------------------
Stephen P. Munn (60) None -- Chairman of the Board 103 Chairman of the
(since 1994) and Board (since
formerly Chief January 1994)
Executive Officer and Director
(1998-2001) and (since 1988) of
President of Carlisle Carlisle
Companies Incorporated. Companies
Incorporated
(manufacturer
of industrial
products);
Director of
Gannett
Co., Inc.
(publishing and
media).
- -----------------------------------------------------------------------------------------------------------
Richard A. Redeker (59) None -- Formerly Management 103
Consultant of
Invesmart, Inc. (August
2001-October 2001);
formerly employee of
Prudential Investments
(October 1996-December
1998).
- -----------------------------------------------------------------------------------------------------------
Robin B. Smith (63) None -- Chairman of the Board 100 Director of
(since January 2003) of BellSouth
Publishers Clearing Corporation
House (direct (since 1992)
marketing); formerly and Kmart
Chairman and Chief Corporation
Executive Officer (retail) (since
(August 1996-January 1996).
2003) of Publishers
Clearing House.
- -----------------------------------------------------------------------------------------------------------
</Table>
7
<Page>
<Table>
<Caption>
NUMBER OF
PORTFOLIOS
IN FUND
COMPLEX OTHER
TERM OF OVERSEEN BY DIRECTORSHIPS**
NAME, POSITION(S) OFFICE AND NOMINEE FOR HELD BY NOMINEE
ADDRESS* HELD WITH LENGTH OF PRINCIPAL OCCUPATION(S) COMMITTEE FOR COMMITTEE
AND AGE THE ACCOUNTS TIME SERVED DURING PAST FIVE YEARS MEMBER MEMBER
- -----------------------------------------------------------------------------------------------------------
Stephen Stoneburn (59) None -- President and Chief 106
Executive Officer
(since June 1996) of
Quadrant Media Corp. (a
publishing company);
formerly President
(June 1995-June 1996)
of Argus Integrated
Media, Inc.; Senior
Vice President and
Managing Director
(January 1993-1995) of
Cowles Business Media
and Senior Vice
President of Fairchild
Publications, Inc
(1975-1989).
- -----------------------------------------------------------------------------------------------------------
Clay T. Whitehead (64) None -- President (since 1983) 125 Director (since
of National Exchange 2000) of First
Inc. (new business Financial
development firm). Fund, Inc. and
Director (since
2000) of The
High Yield Plus
Fund, Inc.
- -----------------------------------------------------------------------------------------------------------
</Table>
PROPOSED INTERESTED COMMITTEE MEMBER NOMINEES
<Table>
<Caption>
NUMBER OF
PORTFOLIOS
IN FUND
COMPLEX OTHER
TERM OF OVERSEEN BY DIRECTORSHIPS**
NAME, POSITION(S) OFFICE AND NOMINEE FOR HELD BY NOMINEE
ADDRESS* HELD WITH LENGTH OF PRINCIPAL OCCUPATION(S) COMMITTEE FOR COMMITTEE
AND AGE THE ACCOUNTS TIME SERVED DURING PAST FIVE YEARS MEMBER MEMBER
- -----------------------------------------------------------------------------------------------------------
Judy A. Rice (55) President Since 2003 President, Chief 129
Executive Officer,
Chief Operating Officer
and Officer-In-Charge
(since 2003) of PI;
formerly various
positions to Senior
Vice President
(1992-1999) of
Prudential Securities
Incorporated (PSI); and
various positions to
Managing Director
(1975-1992) of Salomon
Smith Barney; Member of
Board of Governors of
the Money Management
Institute.
- -----------------------------------------------------------------------------------------------------------
</Table>
8
<Page>
<Table>
<Caption>
NUMBER OF
PORTFOLIOS
IN FUND
COMPLEX OTHER
TERM OF OVERSEEN BY DIRECTORSHIPS**
NAME, POSITION(S) OFFICE AND NOMINEE FOR HELD BY NOMINEE
ADDRESS* HELD WITH LENGTH OF PRINCIPAL OCCUPATION(S) COMMITTEE FOR COMMITTEE
AND AGE THE ACCOUNTS TIME SERVED DURING PAST FIVE YEARS MEMBER MEMBER
- -----------------------------------------------------------------------------------------------------------
Robert F. Gunia (56) Vice Since 1999 Executive Vice 184 Vice President
President President and Chief and Director
Administrative Officer (since May
(since June 1999) of 1989) and
PI; Executive Vice Treasurer
President and Treasurer (since 1999) of
(since January 1996) of The Asia
PI; President (since Pacific
April 1999) of PIMS; Fund, Inc.
Corporate Vice
President (since
September 1997) of
Prudential Insurance;
formerly Senior Vice
President (March
1987-May 1999) of PSI;
formerly Chief
Administrative Officer
(July 1989-September
1996), Director
(January 1989-September
1996) and Executive
Vice President,
Treasurer and Chief
Financial Officer (June
1987-December 1996) of
Prudential Mutual Fund
Management, Inc. (PMF).
- -----------------------------------------------------------------------------------------------------------
</Table>
* Unless otherwise indicated, the address of each nominee is c/o
Prudential Investments LLC, Gateway Center Three, 100 Mulberry Street,
Newark, NJ 07102.
** This column includes only directorships of companies required to
register, or file reports with the Securities and Exchange Commission
(the "SEC") under the Securities Exchange Act of 1934 (that is, "public
companies") or other investment companies registered under the 1940 Act.
9
<Page>
The following tables set forth the dollar range of the investment of each
nominee in the Accounts as of December 31, 2002. The tables also include the
aggregate dollar range of securities held by each nominee in all funds in the
Prudential fund complex overseen by that nominee as of December 31, 2002.
NOMINEE SHARE OWNERSHIP TABLE -- INDEPENDENT COMMITTEE MEMBERS
<Table>
<Caption>
AGGREGATE DOLLAR RANGE
OF SECURITIES IN ALL
REGISTERED INVESTMENT
COMPANIES OVERSEEN BY
DOLLAR RANGE OF NOMINEE IN FAMILY OF
NAME OF NOMINEE INVESTMENT IN ACCOUNTS INVESTMENT COMPANIES
- --------------- ---------------------- ----------------------
David E. A. Carson...................... None None
Robert E. La Blanc...................... None Over $100,000
Douglas H. McCorkindale................. None Over $100,000
Stephen P. Munn......................... None Over $100,000
Richard A. Redeker...................... None Over $100,000
Robin B. Smith.......................... None Over $100,000
Stephen Stoneburn....................... None Over $100,000
Clay T. Whitehead....................... None Over $100,000
</Table>
NOMINEE SHARE OWNERSHIP TABLE -- INTERESTED COMMITTEE MEMBERS
<Table>
<Caption>
AGGREGATE DOLLAR RANGE
OF SECURITIES IN ALL
REGISTERED INVESTMENT
COMPANIES OVERSEEN BY
DOLLAR RANGE OF NOMINEE IN FAMILY OF
NAME OF NOMINEE INVESTMENT IN ACCOUNTS INVESTMENT COMPANIES
- --------------- ---------------------- ----------------------
Judy A. Rice............................ None Over $100,000
Robert F. Gunia......................... None Over $100,000
</Table>
None of the nominees for Independent Committee Member, or any member of his
or her immediate family, owned beneficially or of record any securities in an
investment adviser or principal underwriter of the Accounts or a person (other
than a registered investment company) directly or indirectly controlling,
controlled by, or under common control with an investment adviser or principal
underwriter of the Accounts as of May 1, 2003.
10
<Page>
The following table sets forth information described the aggregate
compensation paid by the Accounts for the most recently completed fiscal year
and by the Prudential fund complex for the calendar year ended December 31, 2002
to each of the nominees for his or her services.
COMPENSATION PAID TO INDEPENDENT COMMITTEE MEMBER NOMINEES
<Table>
<Caption>
PENSION OR TOTAL 2002
RETIREMENT ESTIMATED COMPENSATION
AGGREGATE BENEFITS ANNUAL FROM ACCOUNTS AND
COMPENSATION ACCRUED AS BENEFITS FUND COMPLEX
NAME OF PERSON, FROM THE PART OF UPON PAID TO
POSITION(1) ACCOUNTS ACCOUNT EXPENSES RETIREMENT NOMINEES
- ----------- ------------ ---------------- ---------- -----------------
David E. A. Carson(4)......... None None None None
Robert E. La Blanc............ None None None $137,250 (20/77)(3)
Douglas H. McCorkindale(2).... None None None $115,000 (18/77)(3)
Stephen P. Munn............... None None None $118,000 (23/72)(3)
Richard A. Redeker............ None None None $120,500 (23/72)(3)
Robin B. Smith(2)............. None None None $120,500 (26/69)(3)
Stephen Stoneburn............. None None None $120,250 (18/75)(3)
Clay T. Whitehead............. None None None $196,750 (32/94)(3)
</Table>
- -------------------
(1) Interested Committee Members do not receive any compensation from the
Accounts or the fund complex. None of the Independent Committee Member
nominees currently serves as a Committee Member and therefore none have
received compensation with respect to the Accounts.
(2) Although the last column shows the total amount paid to nominees from
the fund complex during the calendar year ended December 31, 2002, such
compensation was deferred at the election of the directors, in total or
in part, under the funds' deferred fee agreements. Including accrued
interest and the selected fund's rate of return on amounts deferred
through December 31, 2002, the total amount of compensation for the year
amounted to $58,669 and $67,374 for Mr. McCorkindale and Ms. Smith,
respectively.
(3) Indicates number of funds/portfolios in Fund Complex to which aggregate
compensation relates.
(4) Mr. Carson served on the Boards of the American Skandia Trust and
American Skandia Advisor Funds, Inc during the fiscal year ended
December 31, 2002, and Mr. Carson received compensation from those two
funds. These two funds were not part of the Prudential mutual fund
complex until May 1, 2003.
During 2002, the Committee of each Account was composed of one Interested
Committee Member, David R. Odenath, Jr., who is an "interested" member under the
federal securities laws because he is an officer of the
11
<Page>
Accounts' Manager, and the three Independent Committee Members (Saul K. Fenster,
W. Scott McDonald, Jr. and Joseph Weber). The Committees met four times during
the twelve months ended December 31, 2002. It is expected that the Committee
Members will meet at least four times a year at regularly scheduled meetings.
Each Account has an Audit Committee, which is composed entirely of
Independent Directors, and normally meets four times a year, or as required, in
conjunction with the meetings of the Committee for the Account. Currently,
Messrs. Fenster, McDonald and Weber are members of the Audit Committee for each
Account. Among other things, the Audit Committee of each Account has the
following responsibilities:
- Recommending to the Committee of the Account the selection, retention or
termination, as appropriate, of the independent public accountants of the
Account.
- Reviewing the independent accountants' compensation, the proposed terms of
their engagement, and their independence.
- Reviewing annual financial statements, including any adjustments to the
annual financial statements recommended by the Account's independent
accountants, and any significant issues that arose in connection with the
preparation of those financial statements.
- Reviewing changes in accounting policies or practices that had, or are
expected to have, a significant impact on the preparation of financial
statements.
- Generally acting as a liaison between the independent accountants and the
Committee.
A copy of the Audit Committee Charter for each Account is included as
Exhibit A. During the twelve months ended December 31, 2002, the Audit Committee
of each Account met four times.
The Nominating Committee for each Account is currently composed of
Messrs. Fenster, Weber and McDonald. The members confer periodically and hold
meetings as required. The responsibilities of the Nominating Committee include,
but are not limited to, recommending to the Committee the individuals to be
nominated to become Independent Committee Members. During the twelve months
ended December 31, 2002, the Nominating Committee did not meet. The Accounts do
not have compensation committees. The Nominating Committee of each Account
generally will not consider nominees recommended by
Contractholders/Participants.
The firm of PricewaterhouseCoopers LLP ("PwC"), 1177 Avenue of the Americas,
New York, NY 10036, is the independent accountant for each Account. Each Audit
Committee recommended, and each Committee
12
<Page>
approved, the selection of PwC as the Accounts' independent accountant for the
Accounts' current fiscal year. Representatives of PwC are not expected to be
present at the Meetings.
AUDIT FEES
In accordance with Independence Standards Board No. 1, PwC, the Accounts'
independent accountants for the fiscal year ended December 31, 2002, has
confirmed to the Audit Committee that they are independent with respect to the
Accounts. PwC has confirmed the following information:
- AUDIT FEES: The aggregate fees billed by PwC for professional services
rendered for the audit of each Account's annual financial statements for
the fiscal year ended December 31, 2002 were $ for VCA-2, $
for VCA-10, and $ for VCA-11.
- FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES: PwC billed
no fees for professional services rendered to the Accounts for information
technology services relating to financial information systems design and
implementation for the Accounts' most recent fiscal year. Similarly, PwC
billed no fees for professional services rendered to the Accounts' Manager
and any entities controlling, controlled by or under common control with
the Accounts' Manager that provide services to the Accounts for
information technology services relating to financial information systems
design and implementation for the calendar year ended December 31, 2002.
- ALL OTHER FEES: The aggregate fees billed by PwC for services rendered to
the Accounts' Manager and any entity controlling, controlled by or under
common control with the Account's Manager that provides services to the
Accounts, amounted to approximately $1,309,500 for the calendar year ended
December 31, 2002.
REQUIRED VOTE
For each Account, nominees receiving the affirmative vote of a plurality of
the votes cast will be elected, provided a quorum is present at the Meeting.
THE COMMITTEE FOR EACH ACCOUNT, INCLUDING THE INDEPENDENT COMMITTEE MEMBERS,
RECOMMEND THAT YOU VOTE "FOR" EACH OF THE NOMINEES UNDER PROPOSAL NO. 1.
13
<Page>
PROPOSAL NO. 2
TO APPROVE CHANGES TO FUNDAMENTAL INVESTMENT RESTRICTIONS
The Committee of each Account has approved, and recommends that you approve,
certain changes to the fundamental investment restrictions of the Accounts.
OVERVIEW
The Investment Company Act of 1940 (the "1940 Act") requires an investment
company, such as each Account, to adopt "fundamental" investment policies or
restrictions with respect to each of the following practices:
- borrowing money;
- issuing senior securities;
- underwriting securities issued by another company;
- purchasing or selling real estate or commodities;
- making loans; and
- concentrating investments in particular industries.
A "fundamental" policy or restriction may be changed only by a majority vote
of persons having voting rights, who are the Contractholders/Participants in the
case of each Account. In addition, the 1940 Act permits, but does not require,
an investment company to designate other fundamental investment policies or
restrictions concerning other investment practices.
Each Account currently has eight fundamental investment restrictions which
may be changed only with Contractholder/Participant approval.
The Committee of each Account has approved, and recommends that you approve,
proposed changes to each Account's fundamental investment restrictions so that
they match the wording of the restrictions recently proposed for other
investment companies advised by the Account's Manager, PI. The Committee of each
Account and the Manager recommend the changes in order to:
- allow for consistency in the operations of the numerous investment
companies managed by the Manager, which will make it easier for the
Manager and the Subadvisers to monitor compliance;
- provide the Accounts with more flexibility to pursue their investment
objective by removing fundamental restrictions not required by law, to
account for changes in the law, and to take advantage of investment
vehicles and techniques; and
14
<Page>
- allow the Accounts to implement certain investment programs that may help
them to achieve economies of scale by participating in transactions with
other investment companies advised by the Manager, such as the joint
investment in affiliated investment companies and an inter-fund lending
program.
PROPOSED REVISED FUNDAMENTAL INVESTMENT RESTRICTIONS
As explained above, the Committee of each Account recommends that you
approve a revised set of fundamental investment restrictions. Set forth below
are the fundamental investment restrictions as they would read if
Contractholders/Participants approve this Proposal. The information in brackets
is explanatory and is not part of the fundamental restrictions.
(1) The Account may not purchase the securities of any issuer if, as a result,
the Account would fail to be a diversified company within the meaning of
the 1940 Act, and the rules and regulations promulgated thereunder, as each
may be amended from time to time except to the extent that the Account may
be permitted to do so by exemptive order, SEC release, no-action letter or
similar relief or interpretations (collectively, the "1940 Act Laws,
Interpretations and Exemptions").
(2) The Account may not issue senior securities or borrow money or pledge its
assets, except as permitted by the 1940 Act Laws, Interpretations and
Exemptions. For purposes of this restriction, the purchase or sale of
securities on a when-issued or delayed delivery basis, reverse repurchase
agreements, dollar rolls, short sales, derivative and hedging transactions
such as interest rate swap transactions, and collateral arrangements with
respect thereto, and transactions similar to any of the foregoing and
collateral arrangements with respect thereto, and obligations of the
Account to Committee Members pursuant to deferred compensation arrangements
are not deemed to be a pledge of assets or the issuance of a senior
security.
(3) The Account may not buy or sell real estate, except that investment in
securities of issuers that invest in real estate and investments in
mortgage-backed securities, mortgage participations or other instruments
supported or secured by interests in real estate are not subject to this
limitation, and except that the Account may exercise rights relating to
such securities, including the right to enforce security interests and to
hold real estate acquired by reason of such enforcement until that real
estate can be liquidated in an orderly manner.
(4) The Account may not buy or sell physical commodities or contracts involving
physical commodities. The Account may purchase and sell (i) derivative,
hedging and similar instruments such as financial futures contracts and
options thereon, and (ii) securities or instruments backed
15
<Page>
by, or the return from which is linked to, physical commodities or
currencies, such as forward currency exchange contracts, and the Account
may exercise rights relating to such instruments, including the right to
enforce security interests and to hold physical commodities and contracts
involving physical commodities acquired as a result of the Account's
ownership of instruments supported or secured thereby until they can be
liquidated in an orderly manner.
(5) The Account may not purchase any security if as a result 25% or more of the
Account's total assets would be invested in the securities of issuers
having their principal business activities in the same industry, except for
temporary defensive purposes, and except that this limitation does not
apply to securities issued or guaranteed by the U.S. government, its
agencies or instrumentalities.
(6) The Account may not act as underwriter except to the extent that, in
connection with the disposition of portfolio securities, it may be deemed
to be an underwriter under certain federal securities laws.
(7) The Account may make loans, including loans of assets of the Account,
repurchase agreements, trade claims, loan participations or similar
investments, or as permitted by the 1940 Act Laws, Interpretations and
Exemptions. The acquisition of bonds, debentures, other debt securities or
instruments, or participations or other interests therein and investments
in government obligations, commercial paper, certificates of deposit,
bankers' acceptances or instruments similar to any of the foregoing will
not be considered the making of a loan, and is permitted if consistent with
the Account's investment objective.
[For purposes of Investment Restriction 1, the Account will currently not
purchase any security (other than obligations of the U.S. government, its
agencies or instrumentalities) if as a result, with respect to 75% of the
Account's total assets, (i) more than 5% of the Account's total assets
(determined at the time of investment) would be invested in securities of a
single issuer and (ii) the Account would own more than 10% of the
outstanding voting securities of any single issuer.]
[For purposes of Investment Restriction 5, the Account relies on the Global
Industry Classification System (GICS) published by S&P in determining
industry classification. The Account's reliance on this classification
system is not a fundamental policy of the Account and, therefore, can be
changed without shareholder approval.]
[Whenever any the fundamental investment policy or investment restriction
states a maximum percentage of the Account's assets, it is intended that, if
the percentage limitation is met at the time the investment is made, a later
change in percentage resulting from changing total asset values will not be
considered a violation of such policy.
16
<Page>
However, if the Account's asset coverage for borrowings permitted by
Investment Restriction 2 falls below 300%, the Account will take prompt
action to reduce its borrowings, as required by the 1940 Act Laws,
Interpretations and Exemptions.]
SPECIFIC PROPOSED CHANGES
PROPOSAL 2(a): DIVERSIFICATION
Each Account operates as a diversified investment company under the 1940
Act. Each Account's current fundamental investment restriction sets forth the
definition of a diversified investment company included in current law. To
provide flexibility as laws change or relief is obtained from the SEC or its
staff, the revised investment restriction would require that require that each
Account comply with the currently applicable definition of a diversified
investment company, as the law may be amended from time to time except to the
extent that the Account may be permitted to do so by exemptive order, SEC
release, no-action letter or similar relief or interpretations. If approved, the
Manager does not believe that this revision will not have any immediate effect
on the operation of the Accounts.
The current investment restriction reads as follows:
The Account will not purchase any security (other than obligations of
the U.S. Government, its agencies or instrumentalities) if as a result:
with respect to 75% of the Account's total assets, more than 5% of the
Account's total assets (determined at the time of investment) would then
be invested in securities of a single issuer.
The current investment restriction for VCA-11 also includes the following
clarifications:
Notwithstanding this restriction, there is no limitation with respect to
money market instruments of domestic banks, U.S. branches of foreign
banks that are subject to the same regulations as U.S. banks, and
foreign branches of domestic banks (provided that the domestic bank is
unconditionally liable in the event of the failure of the foreign branch
to make payment on its instruments for any reason).
The proposed investment restriction would read as follows:
THE ACCOUNT MAY NOT PURCHASE THE SECURITIES OF ANY ISSUER IF, AS A
RESULT, THE ACCOUNT WOULD FAIL TO BE A DIVERSIFIED COMPANY WITHIN THE
MEANING OF THE 1940 ACT, AND THE RULES AND REGULATIONS PROMULGATED
THEREUNDER, AS EACH MAY BE AMENDED FROM TIME TO TIME EXCEPT TO THE
EXTENT THAT THE ACCOUNT MAY BE PERMITTED TO DO SO BY EXEMPTIVE ORDER,
SEC RELEASE, NO-ACTION LETTER OR SIMILAR RELIEF OR INTERPRETATIONS
(COLLECTIVELY, THE "1940 ACT LAWS, INTERPRETATIONS AND EXEMPTIONS").
17
<Page>
The following note would accompany this proposed investment restriction (and
the note itself is not a fundamental restriction):
FOR PURPOSES OF INVESTMENT RESTRICTION 1, THE ACCOUNT WILL CURRENTLY NOT
PURCHASE ANY SECURITY (OTHER THAN OBLIGATIONS OF THE U.S. GOVERNMENT,
ITS AGENCIES OR INSTRUMENTALITIES) IF AS A RESULT, WITH RESPECT TO 75%
OF THE ACCOUNT'S TOTAL ASSETS, (I) MORE THAN 5% OF THE ACCOUNT'S TOTAL
ASSETS (DETERMINED AT THE TIME OF INVESTMENT) WOULD BE INVESTED IN
SECURITIES OF A SINGLE ISSUER AND (II) THE ACCOUNT WOULD OWN MORE THAN
10% OF THE OUTSTANDING VOTING SECURITIES OF ANY SINGLE ISSUER.
PROPOSAL 2(b): BORROWING MONEY, ISSUING SENIOR SECURITIES OR PLEDGING ASSETS
The current restriction permits each Account to borrow up to 33 1/3% of the
value of its total assets, which is the maximum currently permitted by the 1940
Act. The current restriction also prohibits issuing senior securities except in
connection with certain financial transactions, which is consistent the 1940 Act
and current SEC staff interpretations. To provide flexibility as laws change or
relief is obtained from the SEC or its staff, the revised restriction would
permit borrowing money, issuing senior securities or pledging assets as
permitted by the 1940 Act, rules under the 1940 Act, and any interpretations or
exemptions. This change permits the Accounts to adjust to any revisions to the
law or any exemptions or interpretations, including any lending arrangement
among investment companies advised by the Manager, that may be approved by the
rules or order issued by the SEC. If approved, the Manager does not believe that
this revision will not have any immediate effect on the operation of the
Accounts.
The current investment restriction for each Account reads as follows:
The Account will not issue senior securities, borrow money or pledge its
assets, except that the Account may borrow from banks up to
33 1/3 percent of the value of its total assets (calculated when the
loan is made) for temporary, extraordinary or emergency purposes, for
the clearance of transactions or for investment purposes. The Account
may pledge up to 33 1/3% percent of the value of its total assets to
secure such borrowing. For purposes of this restriction, the purchase or
sale of securities on a when-issued or delayed delivery basis, forward
foreign currency exchange contracts and collateral arrangements relating
thereto, and collateral arrangements with respect to interest rate swap
transactions, reverse repurchase agreements, dollar roll transactions,
options, futures contracts, and options thereon are not deemed to be a
pledge of assets or the issuance of a senior security.
18
<Page>
The current investment restriction for VCA-2 and VCA-10 also includes the
following:
The Account will not purchase securities on margin (but the Account may
obtain such short-term credits as may be necessary for the clearance of
transactions); provided that the deposit or payment by the Account of
initial or maintenance margin in connection with futures or options is
not considered the purchase of a security on margin.
The current investment restriction for VCA-11 also includes the following:
The Account will not purchase securities on margin (but the Account may
obtain such short-term credits as may be necessary for the clearance of
transactions).
The proposed investment restriction would read as follows:
THE ACCOUNT MAY NOT ISSUE SENIOR SECURITIES OR BORROW MONEY OR PLEDGE
ITS ASSETS, EXCEPT AS PERMITTED BY THE 1940 ACT LAWS, INTERPRETATIONS
AND EXEMPTIONS. FOR PURPOSES OF THIS RESTRICTION, THE PURCHASE OR SALE
OF SECURITIES ON A WHEN-ISSUED OR DELAYED DELIVERY BASIS, REVERSE
REPURCHASE AGREEMENTS, DOLLAR ROLLS, SHORT SALES, DERIVATIVE AND HEDGING
TRANSACTIONS SUCH AS INTEREST RATE SWAP TRANSACTIONS, AND COLLATERAL
ARRANGEMENTS WITH RESPECT THERETO, AND TRANSACTIONS SIMILAR TO ANY OF
THE FOREGOING AND COLLATERAL ARRANGEMENTS WITH RESPECT THERETO, AND
OBLIGATIONS OF THE ACCOUNT TO COMMITTEE MEMBERS PURSUANT TO DEFERRED
COMPENSATION ARRANGEMENTS ARE NOT DEEMED TO BE A PLEDGE OF ASSETS OR THE
ISSUANCE OF A SENIOR SECURITY.
The following note would accompany this proposed investment restriction (and
the note itself is not a fundamental restriction):
WHENEVER ANY THE FUNDAMENTAL INVESTMENT POLICY OR INVESTMENT RESTRICTION
STATES A MAXIMUM PERCENTAGE OF THE ACCOUNT'S ASSETS, IT IS INTENDED
THAT, IF THE PERCENTAGE LIMITATION IS MET AT THE TIME THE INVESTMENT IS
MADE, A LATER CHANGE IN PERCENTAGE RESULTING FROM CHANGING TOTAL ASSET
VALUES WILL NOT BE CONSIDERED A VIOLATION OF SUCH POLICY. HOWEVER, IF
THE ACCOUNT'S ASSET COVERAGE FOR BORROWINGS PERMITTED BY INVESTMENT
RESTRICTION 2 FALLS BELOW 300%, THE ACCOUNT WILL TAKE PROMPT ACTION TO
REDUCE ITS BORROWINGS, AS REQUIRED BY THE 1940 ACT LAWS, INTERPRETATIONS
AND EXEMPTIONS.
PROPOSAL 2(c): BUYING OR SELLING REAL ESTATE
The current restriction prohibits each Account from buying or selling real
estate. The current restriction for VCA-2 and VCA-10 also states that these
Accounts may invest in securities secured by real estate. The proposed
19
<Page>
investment restriction would continue the current restriction, but it would also
clarify that each Account can invest in securities secured by real estate and
may exercise rights relating to those securities, including the right to enforce
security interests. If approved, the Manager does not believe that this revision
will not have any immediate effect on the operation of the Accounts.
The current investment restriction for VCA-2 and VCA-10 reads as follows:
No purchase of or investment in real estate will be made for the account
of the Account except that the Account may buy and sell securities that
are secured by real estate or shares of real estate investment trusts
listed on stock exchanges or reported on the National Association of
Securities Dealers, Inc. automated quotation system ("NASDAQ").
The current investment restriction for VCA-11 reads as follows:
No purchase of or investment in real estate will be made for the account
of the Account.
The proposed investment restriction would read as follows:
THE ACCOUNT MAY NOT BUY OR SELL REAL ESTATE, EXCEPT THAT INVESTMENT IN
SECURITIES OF ISSUERS THAT INVEST IN REAL ESTATE AND INVESTMENTS IN
MORTGAGE-BACKED SECURITIES, MORTGAGE PARTICIPATIONS OR OTHER INSTRUMENTS
SUPPORTED OR SECURED BY INTERESTS IN REAL ESTATE ARE NOT SUBJECT TO THIS
LIMITATION, AND EXCEPT THAT THE ACCOUNT MAY EXERCISE RIGHTS RELATING TO
SUCH SECURITIES, INCLUDING THE RIGHT TO ENFORCE SECURITY INTERESTS AND
TO HOLD REAL ESTATE ACQUIRED BY REASON OF SUCH ENFORCEMENT UNTIL THAT
REAL ESTATE CAN BE LIQUIDATED IN AN ORDERLY MANNER.
PROPOSAL 2(d): BUYING OR SELLING COMMODITIES OR COMMODITY CONTRACTS
The current restriction prohibits each Account from purchasing commodities
or commodities contracts. The current restriction for VCA-2 and VCA-10 clarifies
that they may purchase and sell financial futures contracts and related options.
The proposed revisions would more specifically describe the types of financial
futures and other instruments that all the Accounts may purchase despite the
prohibition on buying or selling commodities or commodity contracts. This change
simply provides consistent wording with other investment companies advised by
the Manager.
The current investment restriction for VCA-2 and VCA-10 reads as follows:
No commodities or commodity contracts will be purchased or sold for the
account of the Account except that the Account may purchase and sell
financial futures contracts and related options.
20
<Page>
The current investment restriction for VCA-11 reads as follows:
No commodities or commodity contracts will be purchased or sold for the
account of the Account.
The proposed investment restriction would read as follows:
THE ACCOUNT MAY NOT BUY OR SELL PHYSICAL COMMODITIES OR CONTRACTS
INVOLVING PHYSICAL COMMODITIES. THE ACCOUNT MAY PURCHASE AND SELL
(I) DERIVATIVE, HEDGING AND SIMILAR INSTRUMENTS SUCH AS FINANCIAL
FUTURES CONTRACTS AND OPTIONS THEREON, AND (II) SECURITIES OR
INSTRUMENTS BACKED BY, OR THE RETURN FROM WHICH IS LINKED TO, PHYSICAL
COMMODITIES OR CURRENCIES, SUCH AS FORWARD CURRENCY EXCHANGE CONTRACTS,
AND THE ACCOUNT MAY EXERCISE RIGHTS RELATING TO SUCH INSTRUMENTS,
INCLUDING THE RIGHT TO ENFORCE SECURITY INTERESTS AND TO HOLD PHYSICAL
COMMODITIES AND CONTRACTS INVOLVING PHYSICAL COMMODITIES ACQUIRED AS A
RESULT OF THE ACCOUNT'S OWNERSHIP OF INSTRUMENTS SUPPORTED OR SECURED
THEREBY UNTIL THEY CAN BE LIQUIDATED IN AN ORDERLY MANNER.
PROPOSAL 2(e): INDUSTRY CONCENTRATION
Under the current restriction, each Account may not invest more than 25% of
total assets in securities of issuers in the same industry. The proposed
revision would continue the 25% limitation, but would clarify that the
limitation does not apply to investments made for temporary defensive purposes.
The current investment restriction reads as follows:
The Account will not purchase any security (other than obligations of
the U.S. Government, its agencies or instrumentalities) if as a result:
25% or more of the Account's total assets (determined at the time of the
investment) would be invested in a single industry.
The current investment restriction for VCA-11 also includes the following
clarification:
Notwithstanding this restriction, there is no limitation with respect to
money market instruments of domestic banks, U.S. branches of foreign
banks that are subject to the same regulations as U.S. banks, and
foreign branches of domestic banks (provided that the domestic bank is
unconditionally liable in the event of the failure of the foreign branch
to make payment on its instruments for any reason).
The proposed investment restriction would read as follows:
THE ACCOUNT MAY NOT PURCHASE ANY SECURITY IF AS A RESULT 25% OR MORE OF
THE ACCOUNT'S TOTAL ASSETS WOULD BE INVESTED IN THE SECURITIES OF
ISSUERS HAVING THEIR PRINCIPAL BUSINESS ACTIVITIES IN THE SAME INDUSTRY,
EXCEPT FOR TEMPORARY DEFENSIVE PURPOSES, AND EXCEPT THAT THIS LIMITATION
DOES NOT
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APPLY TO SECURITIES ISSUED OR GUARANTEED BY THE U.S. GOVERNMENT, ITS
AGENCIES OR INSTRUMENTALITIES.
The following note would accompany this proposed investment restriction (and
the note itself is not a fundamental restriction):
FOR PURPOSES OF INVESTMENT RESTRICTION 5, THE ACCOUNT RELIES ON THE
GLOBAL INDUSTRY CLASSIFICATION SYSTEM (GICS) PUBLISHED BY S&P IN
DETERMINING INDUSTRY CLASSIFICATION. A THE ACCOUNT'S RELIANCE ON THIS
CLASSIFICATION SYSTEM IS NOT A FUNDAMENTAL POLICY OF THE ACCOUNT AND,
THEREFORE, CAN BE CHANGED WITHOUT SHAREHOLDER APPROVAL.
PROPOSAL 2(f): ACTING AS AN UNDERWRITER
The current restriction prohibits the Accounts from underwriting securities
of other issuers, except where an Account may be deemed under the federal
securities laws to be an underwriter due to its portfolio management. The
proposed revised restriction is substantially similar and is only a minor
wording change to ensure consistency with other investment companies advised by
the Manager.
The current investment restriction reads as follows:
The Account will not underwrite the securities of other issuers, except
where the Account may be deemed to be an underwriter for purposes of
certain federal securities laws in connection with the disposition of
portfolio securities and with loans that the Account is permitted to
make.
The proposed investment restriction would read as follows:
THE ACCOUNT MAY NOT ACT AS UNDERWRITER EXCEPT TO THE EXTENT THAT, IN
CONNECTION WITH THE DISPOSITION OF PORTFOLIO SECURITIES, IT MAY BE
DEEMED TO BE AN UNDERWRITER UNDER CERTAIN FEDERAL SECURITIES LAWS.
PROPOSAL 2(g): MAKING LOANS
The current restriction provides that the Accounts may not lend money. The
current restriction for VCA-2 and VCA-10 provides that up to 10% of each
Account's assets may be invested in privately placed bonds and other
instruments. The proposed restriction would eliminate the 10% limit on those
investments, clarify that certain investments are not considered the making of a
loan, and permit loans in accordance with the 1940 Act and SEC orders and
interpretations. This change permits the Accounts to adjust to any revisions to
the law or any exemptions or interpretations, including any lending arrangement
among investment companies advised by the Manager that may be approved by the
rules or order issued by the SEC. If approved, the Manager does not believe that
this revision will not have any immediate effect on the operation of the
Accounts.
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The current investment restriction for VCA-2 and VCA-10 reads as follows:
The Account will not lend money, except that loans of up to 10% of the
value of the Account's total assets may be made through the purchase of
privately placed bonds, debentures, notes, and other evidences of
indebtedness of a character customarily acquired by institutional
investors that may or may not be convertible into stock or accompanied
by warrants or rights to acquire stock. Repurchase agreements and the
purchase of publicly traded debt obligations are not considered to be
'loans' for this purpose and may be entered into or purchased by the
Account in accordance with its investment objectives and policies.
The current investment restriction for VCA-11 reads as follows:
The Account will not lend money, except that it may purchase debt
obligations in accordance with its investment objective and policies and
may engage in repurchase agreements.
The proposed investment restriction would read as follows:
THE ACCOUNT MAY MAKE LOANS, INCLUDING LOANS OF ASSETS OF THE ACCOUNT,
REPURCHASE AGREEMENTS, TRADE CLAIMS, LOAN PARTICIPATIONS OR SIMILAR
INVESTMENTS, OR AS PERMITTED BY THE 1940 ACT LAWS, INTERPRETATIONS AND
EXEMPTIONS. THE ACQUISITION OF BONDS, DEBENTURES, OTHER DEBT SECURITIES
OR INSTRUMENTS, OR PARTICIPATIONS OR OTHER INTERESTS THEREIN AND
INVESTMENTS IN GOVERNMENT OBLIGATIONS, COMMERCIAL PAPER, CERTIFICATES OF
DEPOSIT, BANKERS' ACCEPTANCES OR INSTRUMENTS SIMILAR TO ANY OF THE
FOREGOING WILL NOT BE CONSIDERED THE MAKING OF A LOAN, AND IS PERMITTED
IF CONSISTENT WITH THE ACCOUNT'S INVESTMENT OBJECTIVE.
PROPOSAL 2(h): INVESTING TO EXERCISE CONTROL OR MANAGEMENT
The current investment restriction reads as follows:
No securities of any company will be acquired for the Account for the
purpose of exercising control or management thereof.
Because the 1940 Act does not require that the Accounts have a fundamental
restriction or policy on this topic, the Committee of each Account proposes to
delete this fundamental investment restriction and replace it with a
non-fundamental policy also stating that no securities of any company will be
acquired for the Account for the purpose of exercising control or management
thereof. If approved, the Manager does not believe that this revision will not
have any immediate effect on the operation of the Accounts.
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REQUIRED VOTE
Each of the Proposals 2(a) through 2(h) requires the approval by a majority
of each Account's outstanding voting securities, which means approval by the
lesser of (a) a vote of 67% or more of Account's Units whose holders are present
or represented by proxy at the Meeting if holders of more than 50% of all
outstanding Units are present or represented by proxy at the Meeting, or (b) a
vote of more than 50% of all outstanding Units.
THE COMMITTEE FOR EACH ACCOUNT, INCLUDING THE INDEPENDENT COMMITTEE MEMBERS,
RECOMMENDS THAT YOU VOTE "FOR" PROPOSAL NOS. 2(a)-2(h).
CONTRACTHOLDER/PARTICIPANT PROPOSALS
Any Contractholder/Participant who wishes to submit a proposal to be
considered at an Account's next meeting of persons having voting rights with
respect to the Account should send the proposal to that Account at Gateway
Center Three, 100 Mulberry Street, 4th Floor, Newark, New Jersey 07102, so as to
be received within a reasonable time before the Committee makes the solicitation
relating to such meeting, in order to be considered for inclusion in the proxy
statement and form of proxy relating to such meeting.
The Accounts will not be required to hold annual meetings of
Contractholders/Participants if the election of Committee Members is not
required under the Federal securities laws. It is the present intention of the
Committee of each Account not to hold annual meetings of Contractholders/
Participants unless such Contractholder/Participant action is required.
Contractholder/Participant proposals that are submitted in a timely manner
will not necessarily be included in an Account's proxy materials. Inclusion of
such proposals is subject to limitations under the Federal securities laws.
OTHER BUSINESS
Management knows of no business to be presented at the Meetings other than
the matters set forth in this proxy statement, but should any other matter
requiring a vote of Contractholders/Participants arise, management will vote the
proxies according to their best judgment in the interest of the relevant
Account.
/s/ Jonathan D. Shain
Jonathan D. Shain
SECRETARY
May , 2003
It is important that you execute and return ALL of your proxies promptly.
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EXHIBIT A
AUDIT COMMITTEE CHARTER
(APPLICABLE TO EACH ACCOUNT)
The responsibilities of the Audit Committee of each Account are to assist
the Account's Committee in overseeing the Account's independent public
accountants, accounting policies and procedures, and other areas relating to
each Account's auditing processes. The function of the Audit Committee and the
Account's Committee is oversight. It is management's responsibility to maintain
appropriate systems for accounting and internal control and the independent
public accountants' responsibility to plan and carry out a proper audit. The
independent public accountants are responsible to the Account's Committee and
the Audit Committee.
The Audit Committee will assist the Account's Committee by:
- Advising the Account's Committee with respect to the selection, retention
or termination, as appropriate, of the independent public accountants for
the Account.
- Reviewing the independent public accountants' compensation and the
proposed terms of their engagement.
- Monitoring the independence of the independent public accountants.
- Recommending to the Account's Committee the appointment of the Account's
principal accounting officer and principal financial officer.
- Recommending to the Account's Committee, when the Audit Committee deems it
advisable, that the independent public accountants engage in specific
studies and reports regarding auditing matters, accounting procedures, and
tax and other matters.
- Reviewing the arrangements for and scope of the audit of annual financial
statements.
- Reviewing annual financial statements.
- Reviewing, as appropriate and in consultation with the independent public
accountants, accounting policies and procedures applicable to the Account
as well as any management responses to comments relating to those policies
and procedures.
- Reviewing the independent public accountants' opinions.
- Considering, in consultation with the independent public accountants, the
adequacy of internal controls to help provide reasonable assurance that
publicly reported financial statements are presented fairly and in
conformity with generally accepted accounting principles.
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- Investigating, when the Audit Committee deems it necessary, potential
improprieties or improprieties in the Account's operations.
- Meeting, as appropriate, with management of the Account (outside the
presence of the independent public accountants) and with the independent
public accountants of the Account (outside the presence of management) to
discuss any issues relating to the Account's audited financial statements
or otherwise arising from the Audit Committee's functions.
- Reporting the Audit Committee's activities on a regular basis to the
Account's Committee and making such recommendations as the Audit Committee
deems appropriate.
- Annually reviewing and, as appropriate, implementing changes to its
Charter.
In fulfilling the functions outlined above, the Audit Committee will be
entitled to rely on (1) the integrity of those persons and organizations within
and outside each Account from whom it receives information and (2) the accuracy
of financial and other information that these persons and organizations provide
to the Audit Committee. "Management" means the Account's Manager, acting through
its officers and employees, not the Account's officers as such.
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PROXY TABULATOR VOTE TODAY BY MAIL BY RETURNING THE PROXY CARD
P.O. BOX 9132 IN THE ENCLOSED ENVELOPE
HINGHAM, MA 02043-9132 BY TOUCH-T0NE TELEPHONE BY CALLING 1-800-690-6903, OR
BY THE INTERNET BY LOGGING ON TO WWW.PROXYWEB.COM.
THE PRUDENTIAL VARIABLE CONTRACT ACCOUNT - [ ] PROXY FORM
VARIABLE CONTRACT ACCOUNT - [ ]
THIS PROXY IS SOLICITED ON BEHALF OF THE COMMITTEE OF THE ACCOUNT. The
undersigned hereby appoints Grace C. Torres, Marguerite E.H. Morrison and
Jonathan B. Shain as Proxies, each with the power of substitution, and hereby
authorizes each of them to represent and to vote, as designated on the reverse
side, all the Units of the Account held of record by the undersigned on May 2,
2003 at the Meeting to be held at 10:00 a.m. Eastern time on July 17, 2003 at
Gateway Center Three, 100 Mulberry Street, 14th Floor, Newark, NJ 10702, or any
adjournment thereof.
THE UNITS REPRESENTED BY THE PROXY, WHEN THIS PROXY IS PROPERLY EXECUTED, WILL
BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED. THE PROXY WILL BE
VOTED FOR THE NOMINEES AND FOR PROPOSAL 2 IF YOU DO NOT SPECIFY OTHERWISE.
PLEASE REFER TO THE PROXY STATEMENT FOR DISCUSSION OF THE PROPOSALS.
IF VOTING BY MAIL, PLEASE MARK, SIGN AND DATE THIS PROXY CARD WHERE INDICATED
AND RETURN IT PROMPTLY USING THE ENCLOSED ENVELOPE WHICH REQUIRES NO POSTAGE IF
MAILED IN THE UNITED STATES.
In their discretion, the Proxies are authorized to vote upon such other business
as may properly come before the Meeting or any adjournment thereof.
Date _________________________
______________________________
(PLEASE SIGN IN THE BOX) Signature(s)(joint owners)
NOTE: Please sign exactly as name appears hereon. Joint owners should each sign.
When signing as attorney, executor, administrator, trustee or guardian, please
give full title as such. If a corporation, please sign in full corporate name by
president or other authorized officer. If a partnership, please sign in
partnership name by authorized person.
<Page>
PROXY FORM
PLEASE FILL IN BOX(ES) AS SHOWN USING BLACK OR BLUE INK OR
NUMBER 2 PENCIL. PLEASE DO NOT USE FINE POINT PENS.
THE COMMITTEE RECOMMENDS A VOTE FOR ALL OF THE NOMINEES AND EACH OF THE
PROPOSALS.
<Table>
<Caption>
FOR WITHHOLD
To elect as Directors the following 10 nominees: 1. all nominees authority to
(01) David E. A. Carson, (02) Robert E. La Blanc, listed vote for all
(03) Douglas H. McCorkindale, (04) Stephen P. Munn, (except as nominees
(05) Richard A. Redeker, (06) Robin B. Smith, noted at listed
(07) Stephen Stoneburn, (08) Clay T. Whitehead, left)
(09) Judy A. Rice, (10) Robert F. Gunia
[ ] [ ]
</Table>
- --------------------------------------------------------------------------------
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE
THAT NOMINEE'S NUMBER ON THE LINE ABOVE.
<Table>
<Caption>
To Approve Changes to Fundamental Investment Restrictions, relating to: FOR AGAINST ABSTAIN
a. diversification; [ ] [ ] [ ]
b. borrowing money, issuing senior securities or pledging assets; [ ] [ ] [ ]
c. buying and selling real estate; [ ] [ ] [ ]
d. buying and selling commodities or commodity contracts; [ ] [ ] [ ]
e. industry concentration; [ ] [ ] [ ]
f. acting as underwriter; [ ] [ ] [ ]
g. making loans; [ ] [ ] [ ]
h. investing to exercise control. [ ] [ ] [ ]
</Table>
NOTE: YOUR PROXY FORM IS NOT VALID UNLESS IT IS SIGNED.
PLEASE BE SURE TO SIGN YOUR PROXY FORM ON THE REVERSE SIDE.