NEUBERGER BERMAN EQUITY FUNDS, 497, 1999-01-04

NEUBERGER BERMAN EQUITY FUNDS
497, 1999-01-04

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<PAGE>

<PAGE>
[PHOTO] NEUBERGER BERMAN

NEUBERGER BERMAN
EQUITY FUNDS-REGISTERED TRADEMARK-
- --------------------------------------------------------------------------------
PROSPECTUS DECEMBER 30, 1998

The Securities and Exchange Commission does not say
whether any mutual fund is a good or bad investment or
whether the information in any prospectus is accurate or
complete. It is unlawful for anyone to indicate
otherwise.

Focus Fund
Genesis Fund
Guardian Fund
International Fund
Manhattan Fund
Millennium Fund
Partners Fund
Socially Responsive Fund
<PAGE>
CONTENTS

<TABLE>
<C> <S>
NEUBERGER BERMAN EQUITY FUNDS

PAGE 2 ...... Focus Fund

8 ...... Genesis Fund

14 ...... Guardian Fund

20 ...... International Fund

26 ...... Manhattan Fund

32 ...... Millennium Fund

36 ...... Partners Fund

42 ...... Socially Responsive Fund

YOUR INVESTMENT

48 ...... Share Prices

49 ...... Privileges and Services

50 ...... Distributions and Taxes

52 ...... Maintaining Your Account

56 ...... Buying and Selling Shares
</TABLE>

The "Neuberger Berman" name and logo are service
marks of Neuberger Berman, LLC. "Neuberger Berman
Management Inc." and the individual fund names in
this prospectus are either service marks or
registered trademarks of Neuberger Berman
Management Inc. -C-1998 Neuberger Berman Management
Inc.
<PAGE>
- ------------------------------------------------------------

FUND MANAGEMENT
All of the Neuberger Berman Equity Funds are managed by Neuberger Berman
Management Inc., in conjunction with Neuberger Berman, LLC, as sub-adviser.
Together, the firms manage more than $49 billion in total assets (as of
September 30, 1998) and continue an asset management history that began in 1939.

RISK INFORMATION
This prospectus discusses principal risks of investment in fund shares. These
and other risks are discussed in detail in the Statement of Additional
Information (see back cover).

THESE FUNDS:

- - ARE DESIGNED FOR INVESTORS WITH LONG-TERM GOALS IN MIND

- - OFFER YOU THE OPPORTUNITY TO PARTICIPATE IN FINANCIAL MARKETS THROUGH
PROFESSIONALLY MANAGED STOCK PORTFOLIOS

- - ALSO OFFER THE OPPORTUNITY TO DIVERSIFY YOUR PORTFOLIO WITH FUNDS THAT INVEST
USING A VALUE OR A GROWTH APPROACH, OR A COMBINATION OF THE TWO

- - USE A MASTER/FEEDER STRUCTURE IN THEIR PORTFOLIOS; SEE PAGE 54 FOR INFORMATION
ON HOW IT WORKS

- - CARRY CERTAIN RISKS, INCLUDING THE RISK THAT YOU COULD LOSE MONEY IF FUND
SHARES ARE WORTH LESS THAN WHAT YOU PAID

- - ARE MUTUAL FUNDS, NOT BANK DEPOSITS, AND ARE NOT GUARANTEED OR INSURED

1
<PAGE>
[PHOTO]

NEUBERGER BERMAN
FOCUS FUND
- --------------------------------------------------------------------------------

Ticker Symbol: NBSSX ABOVE: PORTFOLIO MANAGER KENT C. SIMONS

"OUR INVESTMENT APPROACH FOR FOCUS FUND INVOLVES LOOKING FOR COMPANIES THAT HAVE
LOW PRICE-TO-EARNINGS RATIOS, SOLID BALANCE SHEETS AND STRONG MANAGEMENT. WE
OFTEN FIND THAT THESE COMPANIES ARE CONCENTRATED IN CERTAIN SECTORS OF THE
ECONOMY, AND WE LOOK FURTHER WITHIN THESE SECTORS FOR OTHER COMPANIES THAT MEET
OUR CRITERIA."

2
<PAGE>
GOAL & STRATEGY
- ------------------------------------------------------------

INDUSTRY SECTORS
The economy is divided into sectors, each made up of related industries. By
focusing on several sectors at a time, a fund can add a measure of
diversification and still allow the potential for performance.

This contrasts with an approach of limiting investment to one sector, which may
offer greater opportunity but also more risk. A sector may have above-average
performance during particular periods, but individual sectors also tend to move
up and down more than the broader market.

VALUE INVESTING
At any given time, there are companies whose stock prices are below the market
average, based on earnings, book value, or other financial measures. The value
investor examines these companies, searching for those that may rise in price
before other investors realize their worth.

[ICON]
THE FUND SEEKS LONG-TERM GROWTH OF CAPITAL.

To pursue this goal, the fund invests mainly in common stocks of
companies of any size that fall within the following sectors:

- - autos and housing

- - consumer goods and services

- - defense and aerospace

- - energy

- - financial services

- - health care

- - heavy industry

- - machinery and equipment

- - media and entertainment

- - retailing

- - technology

- - transportation

- - utilities

At any given time, the fund intends to place most of its assets in those sectors
on the list that the manager believes are undervalued. The fund generally
invests at least 90% of net assets in no more than six sectors. However, it does
not invest more than 50% of total assets in any one sector, or more than 25% of
total assets in any one industry.

The manager looks for undervalued companies. Factors in identifying these firms
may include above-average returns, an established market niche, and sound future
business prospects. This approach is designed to let the fund benefit from
potential increases in stock prices while limiting the risks typically
associated with investing in a small number of sectors.

The fund has the ability to change its goal without shareholder approval,
although it does not currently intend to do so.

Focus Fund 3
<PAGE>
MAIN RISKS
- ------------------------------------------------------------

OTHER RISKS
The fund may use certain practices and securities
involving additional risks.

Borrowing, securities lending, and derivatives could create leverage, meaning
that certain gains or losses could be amplified, increasing share price
movements. In using certain derivatives to gain stock market exposure for excess
cash holdings, the fund increases its risk of loss.

Although they may add diversification, foreign securities can be riskier,
because foreign markets tend to be more volatile and currency exchange rates
fluctuate.

When the fund anticipates unusual market or other conditions, it may temporarily
depart from its goal and invest substantially in high-quality short-term
investments. This could help the fund avoid losses but may mean lost
opportunities.

[ICON] Most of the fund's performance depends
on what happens in the stock market. The market's behavior is
unpredictable, particularly in the short term. Because of this, the
value of your investment will rise and fall, and you could lose money.

Because the fund typically focuses on a few sectors at a time, its performance
is likely to be disproportionately affected by the factors influencing those
sectors. These may include market, economic, political, or regulatory
developments, among others. The fund's performance may also suffer if a sector
does not perform as the portfolio manager expected.

To the extent that the fund emphasizes any particular size of stock, it takes on
the associated risks. Mid- and small-cap stocks tend to be riskier than
large-cap stocks; over time, however, large-cap stocks may perform better or
less well than mid- and small-cap stocks. At any given time, one size of stock
may be out of favor with investors. If the fund emphasizes that size, it could
perform less well than certain other funds.

4 Neuberger Berman
<PAGE>
PERFORMANCE
- ------------------------------------------------------------

PERFORMANCE MEASURES
The information on this page provides different measures of the fund's total
return. Total return includes the effect of distributions as well as changes in
share price. The figures assume that all distributions were reinvested in the
fund.

As a frame of reference, the table includes a broad-based market index. The
fund's performance figures include all of its expenses; the index does not
include costs of investment.

Because the fund had a policy of investing heavily in energy stocks prior to
November 1991, and invested mainly in large-cap stocks prior to September 1998,
its performance during those times would have been different if current policies
had been in effect.

[ICON] The bar chart below shows how the
fund's performance has varied from one year to another. The table
below the chart shows what the return would equal if you averaged out
actual performance over various lengths of time. This information is based on
past performance; it's not a prediction of future results.

YEAR-BY-YEAR % RETURNS as of 12/31 each year

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
1988 16.47%
89 29.78%
90 -5.92%
91 24.66%
92 21.10%
93 16.33%
94 0.87%
95 36.19%
96 16.22%
97 24.15%
BEST QUARTER: Q2 '97, up 16.95%
WORST QUARTER: Q3 '90, down 9.07%
Year-to-date performance as of 9/30/98: down
15.81%
</TABLE>

AVERAGE ANNUAL TOTAL % RETURNS as of 12/31/97

<TABLE>
<CAPTION>
1 Year 5 Years 10 Years
<S> <C> <C> <C>
- -------------------------------------------------------------------

FOCUS FUND 24.15 18.19 17.34
S&P 500 Index 33.32 20.22 18.00
</TABLE>

The S&P 500 is an unmanaged index of U.S. stocks.

Focus Fund 5
<PAGE>
INVESTOR EXPENSES
- -------------------------------------------------------------

MANAGEMENT
KENT C. SIMONS is a Vice President of Neuberger Berman Management and a
principal of Neuberger Berman, LLC. He has managed the fund's assets since 1988.

NEUBERGER BERMAN MANAGEMENT is the fund's investment manager, administrator, and
distributor. It engages Neuberger Berman, LLC as sub-adviser to provide
management and related services. For the 12 months ended 8/31/98, the
management/administration fees paid to Neuberger Berman Management were 0.74% of
average net
assets.

[ICON] The fund does not charge you any fees for
buying, selling, or exchanging shares, or for maintaining your
account. Your only fund cost is your share of annual operating
expenses. The expense example can help you compare costs among funds.

FEE TABLE

SHAREHOLDER FEES None

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

ANNUAL OPERATING EXPENSES (% of average net assets)*

These are deducted from fund assets, so you pay them indirectly.

<TABLE>
<S> <C> <C>
Management fees 0.74
PLUS: Distribution (12b-1) fees None
Other expenses 0.10
....
EQUALS: Total annual operating expenses 0.84
</TABLE>

* THE FIGURES IN THE TABLE ARE BASED ON LAST YEAR'S EXPENSES. ACTUAL EXPENSES
THIS YEAR MAY BE HIGHER OR LOWER. THE TABLE INCLUDES COSTS PAID BY THE FUND
AND ITS SHARE OF MASTER PORTFOLIO COSTS. FOR MORE INFORMATION ON MASTER/FEEDER
FUNDS, SEE "FUND STRUCTURE" ON PAGE 54.

EXPENSE EXAMPLE

The example assumes that you invested $10,000 for the periods shown, that you
earned a hypothetical 5% total return each year, and that the fund's expenses
were those in the table above. Your costs would be the same whether you sold
your shares or continued to hold them at the end of each period. Actual
performance and expenses may be higher or lower.

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
<S> <C> <C> <C> <C>
- -----------------------------------------------------------
Expenses $86 $268 $466 $1037
</TABLE>

6 Neuberger Berman
<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
Year Ended August 31, 1994 1995 1996 1997 1998
<S> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
Data apply to a single share throughout each year indicated. You can see what the fund earned (or lost), what
it distributed to investors, and how its share price changed.
Share price (NAV) at beginning of year 24.00 24.42 28.88 28.46 38.89
PLUS: Income from investment operations
Net investment income 0.21 0.17 0.19 0.08 0.10
Net gains/losses -- realized and unrealized 2.16 5.97 0.85 12.00 (6.21)
Subtotal: income from investment operations 2.37 6.14 1.04 12.08 (6.11)
MINUS: Distributions to shareholders
Income dividends 0.25 0.20 0.11 0.22 0.06
Capital gain distributions 1.70 1.48 1.35 1.43 4.93
Subtotal: distributions to shareholders 1.95 1.68 1.46 1.65 4.99
...........................................
EQUALS: Share price (NAV) at end of year 24.42 28.88 28.46 38.89 27.79
- --------------------------------------------------------------------------------------------------------------
RATIOS (% of average net assets)
The ratios show the fund's expenses and net investment income -- as they actually are as well as how they
would have been if certain expense offset arrangements had not been in effect.
Net expenses -- actual 0.85 0.87 0.89 0.86 0.84
Expenses(1) -- -- 0.89 0.86 0.84
Net investment income -- actual 0.89 0.75 0.69 0.21 0.27
- --------------------------------------------------------------------------------------------------------------
OTHER DATA
Total return shows how an investment in the fund would have performed over each year, assuming all
distributions were reinvested. The turnover rate reflects how actively the fund bought and sold securities.
Total return (%) 10.35 27.47 3.70 43.92 (17.37)
Net assets at end of year (in millions of dollars) 643.9 956.0 1,071.4 1,411.9 1,119.9
Portfolio turnover rate (%) 52 36 39 63 64
</TABLE>

The figures above have been audited by Ernst & Young LLP, the fund's independent
auditors. Their report, along with full financial statements, appears in the
fund's most recent shareholder report (see back cover).

(1) SHOWS WHAT EXPENSES WOULD HAVE
BEEN IF THERE HAD BEEN NO EXPENSE
OFFSET ARRANGEMENTS. THIS
CALCULATION IS REQUIRED FOR ALL
PERIODS ENDING AFTER 9/1/95.

Focus Fund 7
<PAGE>
[PHOTO]

NEUBERGER BERMAN
GENESIS FUND
- --------------------------------------------------------------------------------

Ticker Symbol: NBGNX ABOVE: PORTFOLIO MANAGERS ROBERT W. D'ALELIO
AND JUDITH M. VALE

"WE SEEK OUT SMALL COMPANIES THAT ARE LITTLE-KNOWN AND OFTEN ARE IN LESS
GLAMOROUS INDUSTRIES. FUTURE GROWTH IS ONE AREA WE FOCUS ON, BUT EQUALLY
IMPORTANT TO US IS EVIDENCE OF SOLID PERFORMANCE AND A PROVEN MANAGEMENT TEAM.
AND AS VALUE INVESTORS, WE LOOK FOR STOCKS THAT ARE SELLING AT ATTRACTIVE
PRICES."

THIS FUND IS CURRENTLY CLOSED TO NEW INVESTORS.

8
<PAGE>
GOAL & STRATEGY
- ------------------------------------------------------------

SMALL-CAP STOCKS
Historically, stocks of smaller companies have not always moved in tandem with
those of larger companies. Over the last 40 years, small-caps have outperformed
large-caps more than 60% of the time. However, small-caps have often fallen more
severely during market downturns.

[ICON]
THE FUND SEEKS GROWTH OF CAPITAL.

To pursue this goal, the fund invests mainly in common stocks of
small-capitalization companies, which it defines as those with a total
market value of no more than $1.5 billion at the time the fund first invests in
them. The fund may continue to hold or add to a position in a stock after it has
grown beyond $1.5 billion. The fund seeks to reduce risk by diversifying among
many companies and industries.

The managers look for undervalued companies whose current product lines and
balance sheets are strong. Factors in identifying these firms may include:

- - above-average returns

- - an established market niche

- - circumstances that would make it difficult for new competitors to enter the
market

- - the ability to finance their own growth

- - sound future business prospects

This approach is designed to let the fund benefit from potential increases in
stock prices while limiting the risks typically associated with small-cap
stocks.

At times, the managers may emphasize certain industries that they believe will
benefit from market or economic trends.

The fund has the ability to change its goal without shareholder approval,
although it does not currently intend to do so.

Genesis Fund 9
<PAGE>
MAIN RISKS
- ------------------------------------------------------------

OTHER RISKS
The fund may use certain practices and securities
involving additional risks.

Borrowing, securities lending, and derivatives could create leverage, meaning
that certain gains or losses could be amplified, increasing share price
movements.

Although they may add diversification, foreign securities can be riskier,
because foreign markets tend to be more volatile and currency exchange rates
fluctuate.

Stock prices of many smaller companies are based on future expectations. The
portfolio managers tend to focus on companies whose financial strength is
largely based on existing business lines rather than projected growth. While
this can help reduce risk, the fund is still subject to many of the risks of
small-cap investing. These include the risk that the fund's holdings may:

- - fluctuate more widely in price than the market as a whole

- - underperform other types of stocks when the market or the economy is not
robust

- - fall in price or be difficult to sell during market downturns

- - be noticeably affected by the fortunes of a given sector that the managers
decided to focus on

With a value approach, there is also the risk that stocks may remain undervalued
during a given period. This may happen because value stocks as a category lose
favor with investors compared to growth stocks or because the managers failed to
anticipate which stocks or industries would benefit from changing market or
economic conditions.

10 Neuberger Berman
<PAGE>
PERFORMANCE
- ------------------------------------------------------------

As a frame of reference, the table includes a broad-based market index. The
fund's performance figures include all of its expenses; the index does not
include costs of investment.

YEAR-BY-YEAR % RETURNS as of 12/31 each year

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
1988
'89 17.25%
'90 -16.24%
'91 41.55%
'92 15.62%
'93 13.89%
'94 -1.82%
'95 27.31%
'96 29.86%
'97 34.89%
BEST QUARTER: Q1 '91, up 25.05%
WORST QUARTER: Q3 '90, down 21.81%
Year-to-date performance as of 9/30/98: down
17.16%
</TABLE>

AVERAGE ANNUAL TOTAL % RETURNS as of 12/31/97

<TABLE>
<CAPTION>
Since
Inception
1 Year 5 Years 9/27/88
<S> <C> <C> <C>
- -------------------------------------------------------------------

GENESIS FUND 34.89 20.05 16.58
Russell 2000 Index 22.36 16.40 14.46
</TABLE>

The Russell 2000 is an unmanaged index of U.S. small-cap stocks.

Genesis Fund 11
<PAGE>
INVESTOR EXPENSES
- -------------------------------------------------------------

MANAGEMENT
JUDITH M. VALE and ROBERT W. D'ALELIO are Vice Presidents of Neuberger Berman
Management and principals of Neuberger Berman, LLC. Vale and D'Alelio have been
senior members of the Small Cap Group since 1992 and 1996, respectively. Vale
has co-managed the fund's assets since 1994. D'Alelio joined the firm in 1996
and has co-managed the fund's assets since 1997. From 1988 to 1996, he was a
senior portfolio manager at another firm.

FEE TABLE

SHAREHOLDER FEES None

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

ANNUAL OPERATING EXPENSES (% of average net assets)*

These are deducted from fund assets, so you pay them indirectly.

<TABLE>
<S> <C> <C>
Management fees 0.97
PLUS: Distribution (12b-1) fees None
Other expenses 0.16
....
EQUALS: Total annual operating expenses 1.13
</TABLE>

EXPENSE EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
<S> <C> <C> <C> <C>
- -----------------------------------------------------------
Expenses $115 $359 $622 $1375
</TABLE>

12 Neuberger Berman
<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
Year Ended August 31, 1994 1995 1996 1997 1998
<S> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
Data apply to a single share throughout each year indicated. You can see what the fund earned (or lost), what it
distributed to investors, and how its share price changed.
Share price (NAV) at beginning of year 8.62 8.27 9.52 10.91 15.55
PLUS: Income from investment operations
Net investment income (loss) (0.01) -- (0.01) (0.01) 0.11
Net gains/losses -- realized and unrealized 0.42 1.56 1.95 4.80 (3.00)
Subtotal: income from investment operations 0.41 1.56 1.94 4.79 (2.89)
MINUS: Distributions to shareholders
Income dividends 0.01 -- -- -- --
Capital gain distributions 0.75 0.31 0.55 0.15 0.19
Subtotal: distributions to shareholders 0.76 0.31 0.55 0.15 0.19
....................................................
EQUALS: Share price (NAV) at end of year 8.27 9.52 10.91 15.55 12.47
- -----------------------------------------------------------------------------------------------------------------------
RATIOS (% of average net assets)
The ratios show the fund's expenses and net investment income (loss) -- as they actually are as well as how they would
have been if certain waiver and expense offset arrangements had not been in effect.
Net expenses -- actual 1.36 1.35 1.28 1.16 1.10
Gross expenses(1) -- 1.38 1.38 1.26 1.12
Expenses(2) -- -- 1.28 1.17 1.11
Net investment income (loss) -- actual (0.20) (0.16) (0.18) (0.08) 0.72
- -----------------------------------------------------------------------------------------------------------------------
OTHER DATA
Total return shows how an investment in the fund would have performed over each year, assuming all distributions were
reinvested. The turnover rate reflects how actively the fund bought and sold securities.
Total return (%) 4.77 19.69(3) 21.32(3) 44.32(3) (18.82)(3)
Net assets at end of year (in millions of dollars) 135.6 111.5 195.4 718.1 1,079.1
Portfolio turnover rate (%) 63 37 21 18 18
</TABLE>

(1) SHOWS WHAT THIS RATIO WOULD HAVE BEEN IF THERE HAD BEEN NO MANAGEMENT FEE
WAIVER.

(2) SHOWS WHAT EXPENSES WOULD HAVE BEEN IF THERE HAD BEEN NO EXPENSE OFFSET
ARRANGEMENTS; THE MANAGEMENT FEE WAIVER IS INCLUDED, HOWEVER. THIS
CALCULATION IS REQUIRED FOR ALL PERIODS ENDING AFTER 9/1/95.

(3) WOULD HAVE BEEN LOWER IF NEUBERGER BERMAN MANAGEMENT HAD NOT WAIVED A
PORTION OF THE MANAGEMENT FEE.

Genesis Fund 13
<PAGE>
[PHOTO]

NEUBERGER BERMAN
GUARDIAN FUND
- --------------------------------------------------------------------------------

Ticker Symbol: NGUAX ABOVE: PORTFOLIO MANAGERS KEVIN L. RISEN AND
ALLAN "RICK" WHITE

"WITH GUARDIAN FUND WE LOOK FOR ESTABLISHED COMPANIES THAT ARE EITHER 'UNDER A
ROCK' OR 'UNDER A CLOUD' -- MEANING THAT THEY'RE EITHER NOT WELL FOLLOWED ON
WALL STREET OR THEY'RE TEMPORARILY OUT OF FAVOR WITH OTHER INVESTORS. IT'S VERY
MUCH A CONTINUATION OF THE CLASSIC VALUE APPROACH THE FUND HAS USED SINCE ITS
FOUNDING IN 1950."

14
<PAGE>
GOAL & STRATEGY
- ------------------------------------------------------------

LARGE-CAP STOCKS
Large companies are usually well-established. They may have a variety of
products and business lines and a sound financial base that can help them
weather bad times.

Compared to smaller companies, large companies can be less responsive to changes
and opportunities. At the same time, their returns have sometimes lead those of
smaller companies, often with lower volatility.

[ICON]
THE FUND SEEKS LONG-TERM GROWTH OF CAPITAL; CURRENT INCOME IS A
SECONDARY GOAL.

To pursue these goals, the fund invests mainly in common stocks of
large-capitalization companies. Because the managers tend to find that
undervalued stocks may be more common in certain sectors of the economy at a
given time, the fund may emphasize those sectors.

The fund seeks to reduce risk by diversifying among a large number of companies
across many different industries and economic sectors, and by managing its
overall exposure to a wide variety of risk factors.

The managers look for well-managed companies whose stock prices are undervalued.
Factors in identifying these firms may include:

- - solid balance sheets

- - above-average returns

- - low price-to-earnings ratios

- - consistent earnings

The fund has the ability to change its goal without shareholder approval,
although it does not currently intend to do so.

Guardian Fund 15
<PAGE>
MAIN RISKS
- ------------------------------------------------------------

OTHER RISKS
The fund may use certain practices and securities involving additional risks.

Although they may add diversification, foreign securities can be riskier,
because foreign markets tend to be more volatile and currency exchange rates
fluctuate.

At times, large-cap stocks may lag other types of stocks in performance, which
could cause the fund to perform less well than certain other funds. While they
may at times be less risky than small-cap stocks, large-cap stocks may perform
better or less well over time.

To the extent that a value approach dictates an emphasis on certain sectors of
the market at any given time, the fund's performance is likely to be
disproportionately affected by the economic, market, and other developments that
may influence those sectors. The fund's performance may also suffer if a sector
does not perform as the portfolio managers expected.

16 Neuberger Berman
<PAGE>
PERFORMANCE
- ------------------------------------------------------------

As a frame of reference, the table includes a broad-based market index. The
fund's performance figures include all of its expenses; the index does not
include costs of investment.

DISTRIBUTION HISTORY
In keeping with its goal, the fund has paid an annual income distribution every
quarter since its inception in 1950. It has also paid an annual capital gain
distribution during the same period. Of course, the fund cannot guarantee that
it will continue to make these distributions.

YEAR-BY-YEAR % RETURNS as of 12/31 each year

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
1988 28.05%
'89 21.50%
'90 -4.71%
'91 34.33%
'92 19.01%
'93 14.45%
'94 0.60%
'95 32.11%
'96 17.88%
'97 17.94%
BEST QUARTER: Q1 '91, up 17.42%
WORST QUARTER: Q3 '90, down 15.76%
Year-to-date performance as of 9/30/98: down
16.87%
</TABLE>

AVERAGE ANNUAL TOTAL % RETURNS as of 12/31/97

<TABLE>
<CAPTION>
1 Year 5 Years 10 Years
<S> <C> <C> <C>
- -------------------------------------------------------------------

GUARDIAN FUND 17.94 16.16 17.49
S&P 500 Index 33.32 20.22 18.00
</TABLE>

The S&P 500 is an unmanaged index of U.S. stocks.

Guardian Fund 17
<PAGE>
INVESTOR EXPENSES
- -------------------------------------------------------------

MANAGEMENT
KEVIN L. RISEN and ALLAN R. WHITE III are Vice Presidents of Neuberger Berman
Management and principals of Neuberger Berman, LLC. Risen has co-managed the
fund's assets since 1996. He joined Neuberger Berman in 1992 as an analyst, and
has been a portfolio manager since 1995. White has been co-manager of the fund
since September 1998, when he joined the firm. From 1989 to 1998 he was a
portfolio manager at another firm.

FEE TABLE

SHAREHOLDER FEES None

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

ANNUAL OPERATING EXPENSES (% of average net assets)*

These are deducted from fund assets, so you pay them indirectly.

<TABLE>
<S> <C> <C>
Management fees 0.70
PLUS: Distribution (12b-1) fees None
Other expenses 0.09
....
EQUALS: Total annual operating expenses 0.79
</TABLE>

EXPENSE EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
<S> <C> <C> <C> <C>
- -----------------------------------------------------------
Expenses $81 $252 $439 $978
</TABLE>

18 Neuberger Berman
<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
Year Ended August 31, 1994 1995 1996 1997 1998
<S> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
Data apply to a single share throughout each year indicated. You can see what the fund earned (or lost), what
it distributed to investors, and how its share price changed.
Share price (NAV) at beginning of year 18.57 19.52 23.61 23.78 31.41
PLUS: Income from investment operations
Net investment income 0.24 0.27 0.31 0.15 0.18
Net gains/losses -- realized and unrealized 1.41 4.30 0.90 8.96 (6.09)
Subtotal: income from investment operations 1.65 4.57 1.21 9.11 (5.91)
MINUS: Distributions to shareholders
Income dividends 0.30 0.25 0.28 0.24 0.18
Capital gain distributions 0.40 0.23 0.76 1.24 4.00
Subtotal: distributions to shareholders 0.70 0.48 1.04 1.48 4.18
...........................................
EQUALS: Share price (NAV) at end of year 19.52 23.61 23.78 31.41 21.32
- --------------------------------------------------------------------------------------------------------------
RATIOS (% of average net assets)
The ratios show the fund's expenses and net investment income -- as they actually are as well as how they
would have been if certain expense offset arrangements had not been in effect.
Net expenses -- actual 0.80 0.80 0.82 0.80 0.79
Expenses(1) -- -- 0.82 0.80 0.79
Net investment income -- actual 1.36 1.40 1.37 0.55 0.59
- --------------------------------------------------------------------------------------------------------------
OTHER DATA
Total return shows how an investment in the fund would have performed over each year, assuming all
distributions were reinvested. The turnover rate reflects how actively the fund bought and sold securities.
Total return (%) 9.12 24.06 5.27 39.69 (20.80)
Net assets at end of year (in millions of dollars) 2,416.5 3,947.5 4,905.2 6,475.1 4,210.8
Portfolio turnover rate (%) 24 26 37 50 60
</TABLE>

(1) SHOWS WHAT EXPENSES WOULD HAVE
BEEN IF THERE HAD BEEN NO EXPENSE
OFFSET ARRANGEMENTS. THIS
CALCULATION IS REQUIRED FOR ALL
PERIODS ENDING AFTER 9/1/95.

Guardian Fund 19
<PAGE>
[PHOTO]

NEUBERGER BERMAN
INTERNATIONAL FUND
- --------------------------------------------------------------------------------

Ticker Symbol: NBISX PORTFOLIO MANAGER VALERIE CHANG

"IN IDENTIFYING ATTRACTIVE STOCKS FROM AMONG THE MANY THOUSANDS CURRENTLY
AVAILABLE OUTSIDE THE U.S., IT'S IMPORTANT TO HAVE A CLEAR STRATEGY. THIS FUND
USES A COMBINATION OF GROWTH AND VALUE CRITERIA, WHILE ALSO CONSIDERING LARGER
SCALE ECONOMIC FACTORS."

20
<PAGE>
GOAL & STRATEGY
- ------------------------------------------------------------

FOREIGN STOCKS
There are many promising opportunities for investment outside the U.S. These
foreign markets often respond to different factors, and therefore tend to follow
cycles that are different from each other.

For this reason, many investors put a portion of their portfolios in foreign
investments as a way of gaining further diversification. While foreign stock
markets can be risky, investors gain an opportunity to add potential long-term
growth.

[ICON]
THE FUND SEEKS LONG-TERM GROWTH OF CAPITAL BY INVESTING PRIMARILY IN
COMMON STOCKS OF FOREIGN COMPANIES.

To pursue this goal, the fund invests mainly in foreign companies of any size,
including companies in developed and emerging industrialized markets. The fund
defines a foreign company as one that is organized outside of the United States
and conducts the majority of its business abroad.

The fund seeks to reduce risk by diversifying among many industries. Although it
has the flexibility to invest a significant portion of its assets in one country
or region, it generally intends to remain well-diversified across countries and
geographical regions.

In picking stocks, the manager looks for well-managed companies that show
potential for above-average growth or whose stock prices are undervalued.
Factors in identifying these firms may include strong fundamentals, such as
attractive cash flows and balance sheets, as well as prices that are reasonable
in light of projected earnings growth. The manager also considers the outlooks
for various countries and regions around the world, examining economic, market,
social, and political conditions.

The fund has the ability to change its goal without shareholder approval,
although it does not currently intend to do so.

International Fund 21
<PAGE>
MAIN RISKS
- ------------------------------------------------------------

OTHER RISKS
The fund may use certain practices and securities involving additional risks.

Borrowing, securities lending, and derivatives could create leverage, meaning
that certain gains or losses could be amplified, increasing share price
movements. The fund may use derivatives for hedging and for speculation. Hedging
could reduce the fund's losses from currency fluctuations, but could also reduce
its gains. A derivative instrument could fail to perform as expected. Any
speculative investment could cause a loss for the fund.

[ICON] Most of the fund's performance depends
on what happens in international stock markets. The behavior of these
markets is unpredictable, particularly in the short term. Because of
this, the value of your investment will rise and fall, sometimes sharply, and
you could lose money.

Foreign stocks are riskier than comparable U.S. stocks. This is in part because
foreign markets are less developed and foreign governments, economies, laws, tax
codes and securities firms may be less stable. There is also a higher chance
that key information will be unavailable, incomplete, or inaccurate. As a
result, foreign stocks can fluctuate more widely in price than comparable U.S.
stocks, and they may also be less liquid. These risks are generally greater in
emerging markets. Over a given period of time, foreign stocks may underperform
U.S. stocks -- sometimes for years. The fund could also underperform if the
manager invests in the wrong countries or regions.

Changes in currency exchange rates bring an added dimension of risk. Currency
fluctuations could erase investment gains or add to investment losses.

To the extent that the fund invests in growth stocks or in value stocks, it
takes on the risks associated with both types of stocks. Growth stocks may
suffer more than value stocks during market downturns, while value stocks may
remain undervalued. Either type of stock may underperform the other during a
given period.

22 Neuberger Berman
<PAGE>
PERFORMANCE
- ------------------------------------------------------------

As a frame of reference, the table includes a broad-based market index. The
fund's performance figures include all of its expenses; the index does not
include costs of investment.

Because the fund had a policy of investing primarily in mid- and large-cap
stocks prior to September 1998, its performance during that time would have been
different if current policies had been in effect.

YEAR-BY-YEAR % RETURNS as of 12/31 each year

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
1988
'89
'90
'91
'92
'93
'94
'95 7.88%
'96 23.69%
'97 11.21%
BEST QUARTER: Q2 '97, up 9.30%
WORST QUARTER: Q4 '97, down 8.67%
Year-to-date performance as of 9/30/98: down
12.09%
</TABLE>

AVERAGE ANNUAL TOTAL % RETURNS as of 12/31/97

<TABLE>
<CAPTION>
Since
Inception
1 Year 6/15/94
<S> <C> <C>
- --------------------------------------------------------------

INTERNATIONAL FUND 11.21 11.54
EAFE Index 2.06 5.38
</TABLE>

The EAFE is an unmanaged index of stocks from Europe, Australasia, and the Far
East.

International Fund 23
<PAGE>
INVESTOR EXPENSES
- -------------------------------------------------------------

MANAGEMENT
VALERIE CHANG is an Assistant Vice President of Neuberger Berman Management. In
1996 she joined the firm and became assistant manager of the fund. She has been
the manager since 1997. She began her career in 1990 in banking, and from 1995
to 1996 was a senior securities analyst at another firm.

FEE TABLE

SHAREHOLDER FEES None

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

ANNUAL OPERATING EXPENSES (% of average net assets)*

These are deducted from fund assets, so you pay them indirectly.

<TABLE>
<S> <C> <C>
Management fees 1.11
PLUS: Distribution (12b-1) fees None
Other expenses 0.60
....
EQUALS: Total annual operating expenses 1.71
</TABLE>

* THE FIGURES IN THE TABLE ARE BASED ON LAST YEAR'S EXPENSES. ACTUAL EXPENSES
THIS YEAR MAY BE HIGHER OR LOWER. THE TABLE INCLUDES COSTS PAID BY THE FUND
AND ITS SHARE OF MASTER PORTFOLIO COSTS. FOR MORE INFORMATION ON
MASTER/FEEDER FUNDS, SEE "FUND STRUCTURE" ON PAGE 54.

EXPENSE EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
<S> <C> <C> <C> <C>
- -----------------------------------------------------------
Expenses $174 $539 $928 $2019
</TABLE>

24 Neuberger Berman
<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
Year Ended August 31, 1994(1) 1995 1996 1997 1998
<S> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
Data apply to a single share throughout each year indicated. You can see what the fund earned (or lost), what it distributed
to investors, and how its share price changed.
Share price (NAV) at beginning of year 10.00 10.46 10.70 11.91 14.83
PLUS: Income from investment operations
Net investment income (loss) 0.01 0.06 0.01 -- (0.03)
Net gains/losses -- realized and unrealized 0.45 0.21 1.24 2.94 (0.81)
Subtotal: income from investment operations 0.46 0.27 1.25 2.94 (0.84)
MINUS: Distributions to shareholders
Income dividends -- 0.03 0.04 0.02 --
Capital gain distributions -- -- -- -- 0.14
Subtotal: distributions to shareholders -- 0.03 0.04 0.02 0.14
.........................................................
EQUALS: Share price (NAV) at end of year 10.46 10.70 11.91 14.83 13.85
- ----------------------------------------------------------------------------------------------------------------------------
RATIOS (% of average net assets)
The ratios show the fund's expenses and net investment income (loss) -- as they actually are as well as how they would have
been if certain expense reimbursement/repayment and offset arrangements had not been in effect.
Net expenses -- actual 1.70(2) 1.70 1.70 1.70 1.70
Gross expenses(3) 2.50(2) 2.31 2.28 1.69 1.61
Expenses(4) -- -- 1.70 1.70 1.71
Net investment income (loss) -- actual 0.57(2) 0.73 0.24 (0.02) (0.24)
- ----------------------------------------------------------------------------------------------------------------------------
OTHER DATA
Total return shows how an investment in the fund would have performed over each year, assuming all distributions were
reinvested. The turnover rate reflects how actively the fund bought and sold securities.
Total return (%) 4.60(5)(6) 2.60(6) 11.73(6) 24.71 (5.69)
Net assets at end of year (in millions of dollars) 6.2 26.4 57.0 115.4 125.5
Portfolio turnover rate (%) 5 41 45 37 46
</TABLE>

(1) PERIOD FROM 6/15/94 (BEGINNING OF OPERATIONS) TO 8/31/94.

(2) ANNUALIZED.

(3) SHOWS WHAT THIS RATIO WOULD HAVE BEEN IF THERE HAD BEEN NO EXPENSE
REIMBURSEMENT/REPAYMENT.

(4) SHOWS WHAT EXPENSES WOULD HAVE BEEN IF THERE HAD BEEN NO EXPENSE OFFSET
ARRANGEMENTS. THIS CALCULATION IS REQUIRED FOR ALL PERIODS ENDING AFTER
9/1/95.

(5) NOT ANNUALIZED.

(6) WOULD HAVE BEEN LOWER IF NEUBERGER BERMAN MANAGEMENT HAD NOT REIMBURSED
CERTAIN EXPENSES.

International Fund 25
<PAGE>
[PHOTO]

NEUBERGER BERMAN
MANHATTAN FUND
- --------------------------------------------------------------------------------

Ticker Symbol: NMANX ABOVE: PORTFOLIO MANAGERS JENNIFER K. SILVER
AND BROOKE A. COBB

"WITHOUT QUESTION, WE ARE GROWTH INVESTORS. WE LOOK FOR COMPANIES THAT WE THINK
WILL DELIVER POSITIVE EARNINGS SURPRISES, PARTICULARLY THOSE WITH THE POTENTIAL
TO DO SO CONSISTENTLY. IDEALLY, WE WANT TO IDENTIFY COMPANIES THAT WILL SOMEDAY
RANK AMONG THE FORTUNE 500."

26
<PAGE>
GOAL & STRATEGY
- ------------------------------------------------------------

MID-CAP STOCKS
Mid-cap stocks have historically shown risk/return characteristics that are in
between those of small- and large-cap stocks. Their prices can rise and fall
substantially, although they have the potential to offer comparatively
attractive long-term returns.

Mid-caps are less widely followed on Wall Street than large-caps, which can make
it comparatively easier to find attractive stocks that are not overpriced.

GROWTH INVESTING
For growth investors, the aim is to invest in companies that are already
successful but could be even more so. Often, these stocks are in emerging or
rapidly growing industries.

While most growth stocks are known to investors, they may not yet have reached
their full potential. The growth investor looks for reasons for continued
success.

[ICON]
THE FUND SEEKS GROWTH OF CAPITAL.

To pursue this goal, the fund invests mainly in common stocks of
mid-capitalization companies. The fund seeks to reduce risk by diversifying
among many companies and industries.

The managers look for fast-growing companies that are in new or rapidly evolving
industries. Factors in identifying these firms may include:

- - above-average growth of earnings

- - earnings that have exceeded analysts' expectations

The managers may also look for other characteristics in a company, such as
financial strength, a strong position relative to competitors and a stock price
that is reasonable in light of its growth rate.

The managers follow a disciplined selling strategy, and may drop a stock from
the portfolio when it reaches a target price, fails to perform as expected, or
appears substantially less desirable than another stock.

The fund has the ability to change its goal without shareholder approval,
although it does not currently intend to do so.

Manhattan Fund 27
<PAGE>
MAIN RISKS
- ------------------------------------------------------------

OTHER RISKS
The fund may use certain practices and securities involving additional risks.

Borrowing, securities lending, and derivatives could create leverage, meaning
that certain gains or losses could be amplified, increasing share price
movements.

Although they may add diversification, foreign securities can be riskier,
because foreign markets tend to be more volatile and currency exchange rates
fluctuate.

By focusing on mid-cap stocks, the fund is subject to their risks, including the
risk its holdings may:

- - fluctuate more widely in price than the market as a whole

- - underperform other types of stocks when the market or the economy is not
robust

- - fall in price or be difficult to sell during market downturns

Because the prices of most growth stocks are based on future expectations, these
stocks tend to be more sensitive than value stocks to bad economic news and
negative earnings surprises. While the prices of any type of stock can rise and
fall rapidly, growth stocks in particular may underperform during periods when
the market favors value stocks. The fund's performance may also suffer if
certain stocks do not perform as the portfolio managers expected. To the extent
that the managers sell stocks before they reach their market peak, the fund may
miss out on opportunities for higher performance.

Through active trading, the fund may have a high portfolio turnover rate, which
can mean higher taxable distributions and lower performance due to increased
brokerage costs.

28 Neuberger Berman
<PAGE>
PERFORMANCE
- ------------------------------------------------------------

As a frame of reference, the table includes a broad-based market index as well
as a more focused index of mid-cap growth stocks. The fund's performance figures
include all of its expenses; the indices do not include costs of investment.

Because the fund had a policy of investing in stocks of all capitalizations and
used a comparatively more value-oriented investment approach prior to July 1997,
its performance would have been different if current policies had been in
effect.

YEAR-BY-YEAR % RETURNS as of 12/31 each year

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
1988 18.31%
'89 29.09%
'90 -8.05%
'91 30.89%
'92 17.77%
'93 10.01%
'94 -3.60%
'95 31.00%
'96 9.85%
'97 29.20%
BEST QUARTER: Q1 '91, up 14.75%
WORST QUARTER: Q3 '90, down 15.88%
Year-to-date performance as of 9/30/98: down
8.72%
</TABLE>

AVERAGE ANNUAL TOTAL % RETURNS as of 12/31/97

<TABLE>
<CAPTION>
1 Year 5 Years 10 Years
<S> <C> <C> <C>
- -------------------------------------------------------------------

MANHATTAN FUND 29.20 14.54 15.62
Russell Midcap Growth Index 22.54 15.98 16.80
S&P 500 Index 33.32 20.22 18.00
</TABLE>

The Russell Midcap Growth is an unmanaged index of U.S. mid-cap growth stocks.

The S&P 500 is an unmanaged index of U.S. stocks.

Manhattan Fund 29
<PAGE>
INVESTOR EXPENSES
- -------------------------------------------------------------

MANAGEMENT
JENNIFER K. SILVER is a Vice President of Neuberger Berman Management and a
principal of Neuberger Berman, LLC. Currently the Director of the Growth Equity
Group, she has been co-manager of the fund since joining the firm in 1997. From
1981 to 1997, she was an analyst and a portfolio manager at another firm.

BROOKE A. COBB is a Vice President of Neuberger Berman Management. He has been
co-manager of the fund since joining the firm in 1997. From 1972 to 1997, he was
a portfolio manager at several other firms.

FEE TABLE

SHAREHOLDER FEES None

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

ANNUAL OPERATING EXPENSES (% of average net assets)*

These are deducted from fund assets, so you pay them indirectly.

<TABLE>
<S> <C> <C>
Management fees 0.79
PLUS: Distribution (12b-1) fees None
Other expenses 0.16
....
EQUALS: Total annual operating expenses 0.95
</TABLE>

EXPENSE EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
<S> <C> <C> <C> <C>
- -----------------------------------------------------------
Expenses $97 $303 $525 $1166
</TABLE>

30 Neuberger Berman
<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
Year Ended August 31, 1994 1995 1996 1997 1998
<S> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
Data apply to a single share throughout each year indicated. You can see what the fund earned (or lost), what
it distributed to investors, and how its share price changed.
Share price (NAV) at beginning of year 12.94 11.28 13.27 11.94 14.51
PLUS: Income from investment operations
Net investment income (loss) 0.02 -- (0.04) (0.03) (0.05)
Net gains/losses -- realized and unrealized 0.40 2.70 (0.33) 4.26 (1.20)
Subtotal: income from investment operations 0.42 2.70 (0.37) 4.23 (1.25)
MINUS: Distributions to shareholders
Income dividends 0.02 0.01 -- -- --
Capital gain distributions 2.06 0.70 0.96 1.66 3.84
Subtotal: distributions to shareholders 2.08 0.71 0.96 1.66 3.84
...........................................
EQUALS: Share price (NAV) at end of year 11.28 13.27 11.94 14.51 9.42
- --------------------------------------------------------------------------------------------------------------
RATIOS (% of average net assets)
The ratios show the fund's expenses and net investment income (loss) -- as they actually are as well as how
they would have been if certain expense offset arrangements had not been in effect.
Net expenses -- actual 0.96 0.98 0.98 0.98 0.94
Expenses(1) -- -- 0.98 0.99 0.95
Net investment income (loss) -- actual 0.16 0.03 (0.27) (0.20) (0.42)
- --------------------------------------------------------------------------------------------------------------
OTHER DATA
Total return shows how an investment in the fund would have performed over each year, assuming all
distributions were reinvested. The turnover rate reflects how actively the fund bought and sold securities.
Total return (%) 3.49 26.00 (2.91) 38.75 (11.02)
Net assets at end of year (in millions of dollars) 510.3 612.0 516.2 570.4 476.6
Portfolio turnover rate (%) 50 44 53 89 90
</TABLE>

The figures above have been audited by PricewaterhouseCoopers LLP, the fund's
independent accountants. Their report, along with full financial statements,
appears in the fund's most recent shareholder report (see back cover).

(1) SHOWS WHAT EXPENSES WOULD HAVE
BEEN IF THERE HAD BEEN NO EXPENSE
OFFSET ARRANGEMENTS. THIS
CALCULATION IS REQUIRED FOR ALL
PERIODS ENDING AFTER 9/1/95.

Manhattan Fund 31
<PAGE>
[PHOTO]

NEUBERGER BERMAN
MILLENNIUM FUND
- --------------------------------------------------------------------------------

ABOVE: PORTFOLIO MANAGERS JENNIFER K. SILVER
AND MICHAEL F. MALOUF

"WE MAKE IT OUR BUSINESS TO TRACK DOWN PROMISING SMALL-CAP COMPANIES WHEREVER
THEY MAY BE. AS A RESULT, THIS FUND ENABLES INVESTORS WHO CAN ACCEPT THE RISKS
OF SMALL-CAP STOCKS TO PURSUE THE POTENTIAL FOR LONG-TERM GROWTH THAT SMALL-CAPS
MAY PROVIDE."

32
<PAGE>
GOAL & STRATEGY
- ------------------------------------------------------------

GROWTH INVESTING
For growth investors, the aim is to invest in companies that are already
successful but could be even more so. Often, these stocks are in emerging or
rapidly growing industries.

While most growth stocks are known to investors, they may not yet have reached
their full potential. The growth investor looks for reasons for continued
success.

[ICON]
THE FUND SEEKS GROWTH OF CAPITAL.

To pursue this goal, the fund invests mainly in common stocks of
small-capitalization companies, which it defines as those with a total market
value of no more than $1.5 billion at the time the fund first invests in them.
The fund may continue to hold or add to a position in a stock after it has grown
beyond $1.5 billion. The fund seeks to reduce risk by diversifying among many
companies and industries.

The managers take a growth approach to selecting stocks, looking for new
companies that are in the developmental stage as well as older companies that
appear poised to grow because of new products, markets or management. Factors in
identifying these firms may include financial strength, a strong position
relative to competitors and a stock price that is reasonable in light of its
growth rate.

The fund has the ability to change its goal without shareholder approval,
although it does not currently intend to do so.

Millennium Fund 33
<PAGE>
MAIN RISKS
- ------------------------------------------------------------

OTHER RISKS
The fund may use certain practices and securities involving additional risks.

Borrowing, securities lending, and derivatives could create leverage, meaning
that certain gains or losses could be amplified, increasing share price
movements.

Although they may add diversification, foreign securities can be riskier,
because foreign markets tend to be more volatile and currency exchange rates
fluctuate.

By focusing on small-cap stocks, the fund is subject to many of their risks,
including the risk its holdings may:

- - fluctuate more widely in price than the market as a whole

- - underperform other types of stocks, especially when the market or the economy
is not robust

- - fall in price or be difficult to sell during market downturns

- - be noticeably affected by the fortunes of those sectors in which small-cap
growth stocks may be concentrated

Through active trading, the fund may have a high portfolio turnover rate, which
can mean higher taxable distributions and lower performance due to increased
brokerage costs.

34 Neuberger Berman
<PAGE>
INVESTOR EXPENSES
- ------------------------------------------------------------

MANAGEMENT
MICHAEL F. MALOUF is a Vice President of Neuberger Berman Management. He has
been co-manager of the fund since its inception in 1998, the year he joined the
firm. From 1991 to 1998 he was a portfolio manager at another firm.

JENNIFER K. SILVER is a Vice President of Neuberger Berman Management and a
principal of Neuberger Berman, LLC. Currently the Director of the Growth Equity
Group since 1997, she has been co-manager of the fund since 1998. From 1981 to
1997, she was an analyst and a portfolio manager at another firm.

NEUBERGER BERMAN MANAGEMENT is the fund's investment manager, administrator, and
distributor. It engages Neuberger Berman, LLC as sub-adviser to provide
management and related services.

FEE TABLE

SHAREHOLDER FEES None

- -------------------------------------------------------
ANNUAL OPERATING EXPENSES (% of average net assets)*
These are deducted from fund assets, so you pay them indirectly.

<TABLE>
<S> <C> <C>
Management fees 1.11
PLUS: Distribution (12b-1) fees None
Other expenses** 1.20
....
EQUALS: Total annual operating expenses 2.31
</TABLE>

* NEUBERGER BERMAN MANAGEMENT REIMBURSES CERTAIN EXPENSES OF THE FUND SO THAT
THE TOTAL ANNUAL OPERATING EXPENSES OF THE FUND ARE LIMITED TO 1.75% OF
AVERAGE NET ASSETS. THIS ARRANGEMENT CAN BE TERMINATED UPON SIXTY DAYS'
NOTICE TO THE FUND. IN ADDITION, THE ARRANGEMENT DOES NOT COVER INTEREST,
TAXES, BROKERAGE COMMISSIONS, AND EXTRAORDINARY EXPENSES. THE TABLE INCLUDES
COSTS PAID BY THE FUND AND ITS SHARE OF MASTER PORTFOLIO COSTS. FOR MORE
INFORMATION ON MASTER/FEEDER FUNDS, SEE "FUND STRUCTURE" ON PAGE 54.

** OTHER EXPENSES ARE BASED ON ESTIMATED AMOUNTS FOR THE CURRENT FISCAL YEAR.

EXPENSE EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years
<S> <C> <C>
- --------------------------------------
Expenses*** $234 $721
</TABLE>

*** UNDER THE FUND'S EXPENSE REIMBURSEMENT ARRANGEMENT DESCRIBED IN THE FOOTNOTE
ABOVE, YOUR COSTS FOR THE ONE- AND THREE-YEAR PERIODS WOULD BE $178 AND
$551, RESPECTIVELY.

BECAUSE THE FUND IS NEW IT DOES NOT HAVE PERFORMANCE OR FINANCIAL HIGHLIGHTS TO
REPORT.

Millennium Fund 35
<PAGE>
[PHOTO]

NEUBERGER BERMAN
PARTNERS FUND
- --------------------------------------------------------------------------------

Ticker Symbol: NPRTX ABOVE: PORTFOLIO MANAGERS ROBERT I.
GENDELMAN, MICHAEL M. KASSEN AND S. BASU
MULLICK

"OUR MANAGEMENT APPROACH FOCUSES ON FINDING UNDERVALUED COMPANIES. IN
PARTICULAR, WE LOOK FOR 'FALLEN ANGELS' -- GROWTH STOCKS WHOSE PRICES HAVE HIT
NEW LOWS. AT THE SAME TIME, WE TEND TO BE DISCIPLINED IN MAKING SELL DECISIONS.
WE WOULD RATHER SELL EARLY THAN SELL TOO LATE."

36
<PAGE>
GOAL & STRATEGY
- ------------------------------------------------------------

MID- AND LARGE-
CAP STOCKS
Large companies are usually well-established. Compared to mid-cap companies,
they may be less responsive to change, but their returns have sometimes lead
those of mid-cap companies, often with lower volatility.

Mid-cap stocks have historically performed more like small-caps than like large-
caps. Their prices can rise and fall substantially, although they have the
potential to offer attractive long-term returns.

[ICON]
THE FUND SEEKS GROWTH OF CAPITAL.

To pursue this goal, the fund invests mainly in common stocks of mid- to
large-capitalization companies. The fund seeks to reduce risk by diversifying
among many companies and industries.

The managers look for well-managed companies whose stock prices are undervalued.
Factors in identifying these firms may include:

- - strong fundamentals

- - consistent cash flow

- - a sound track record through all phases of the market cycle

The managers may also look for other characteristics in a company, such as a
strong position relative to competitors, a high level of stock ownership among
management, and a recent sharp decline in stock price that appears to be the
result of a short-term market overreaction to negative news.

The fund generally considers selling a stock when it reaches the managers'
target price, when it fails to perform as expected, or when other opportunities
appear more attractive.

The fund has the ability to change its goal without shareholder approval,
although it does not currently intend to do so.

Partners Fund 37
<PAGE>
MAIN RISKS
- ------------------------------------------------------------

OTHER RISKS
The fund may use certain practices and securities involving additional risks.

Borrowing, securities lending, and derivatives could create leverage, meaning
that certain gains or losses could be amplified, increasing share price
movements.

Although they may add diversification, foreign securities can be riskier,
because foreign markets tend to be more volatile and currency exchange rates
fluctuate.

To the extent that the fund emphasizes mid- or large-cap stocks, it takes on the
associated risks. Mid-cap stocks tend to be somewhat riskier than large-cap
stocks; over time, however, large-cap stocks may perform better or less well
than mid-cap stocks. At any given time, one or both groups of stocks may be out
of favor with investors. If the fund emphasizes either group of stocks, its
performance could suffer.

Through active trading, the fund may have a high portfolio turnover rate, which
can mean higher taxable distributions and lower performance due to increased
brokerage costs.

38 Neuberger Berman
<PAGE>
PERFORMANCE
- ------------------------------------------------------------

As a frame of reference, the table includes a broad-based market index. The
fund's performance figures include all of its expenses; the index does not
include costs of investment.

YEAR-BY-YEAR % RETURNS as of 12/31 each year

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
1988 15.46%
'89 22.78%
'90 -5.11%
'91 22.36%
'92 17.52%
'93 16.46%
'94 -1.89%
'95 35.21%
'96 26.49%
'97 29.23%
BEST QUARTER: Q2 '97, up 14.04%
WORST QUARTER: Q3 '90, down 9.61%
Year-to-date performance as of 9/30/98: down
8.67%
</TABLE>

AVERAGE ANNUAL TOTAL % RETURNS as of 12/31/97

<TABLE>
<CAPTION>
1 Year 5 Years 10 Years
<S> <C> <C> <C>
- -------------------------------------------------------------------

PARTNERS FUND 29.23 20.35 17.19
S&P 500 Index 33.32 20.22 18.00
</TABLE>

The S&P 500 is an unmanaged index of U.S. stocks.

Partners Fund 39
<PAGE>
INVESTOR EXPENSES
- -------------------------------------------------------------

MANAGEMENT
MICHAEL M. KASSEN, ROBERT I. GENDELMAN AND S. BASU MULLICK are Vice Presidents
of Neuberger Berman Management.
Kassen and Gendelman
are principals of Neuberger
Berman, LLC. Kassen has been manager of the fund since 1990, and was joined by
Gendelman in 1994 and Mullick in 1998. Gendelman was a portfolio manager at
another firm from 1992 to 1993, as was Mullick from 1993 to 1998.

FEE TABLE

SHAREHOLDER FEES None

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

ANNUAL OPERATING EXPENSES (% of average net assets)*

These are deducted from fund assets, so you pay them indirectly.

<TABLE>
<S> <C> <C>
Management fees 0.71
PLUS: Distribution (12b-1) fees None
Other expenses 0.09
....
EQUALS: Total annual operating expenses 0.80
</TABLE>

EXPENSE EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
<S> <C> <C> <C> <C>
- -----------------------------------------------------------
Expenses $82 $255 $444 $990
</TABLE>

40 Neuberger Berman
<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
Year Ended August 31, 1994 1995 1996 1997 1998
<S> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
Data apply to a single share throughout each year indicated. You can see what the fund earned (or lost), what
it distributed to investors, and how its share price changed.
Share price (NAV) at beginning of year 22.46 21.32 23.72 23.88 31.60
PLUS: Income from investment operations
Net investment income 0.10 0.17 0.22 0.19 0.23
Net gains/losses -- realized and unrealized 1.07 3.94 2.84 10.36 (2.83)
Subtotal: income from investment operations 1.17 4.11 3.06 10.55 (2.60)
MINUS: Distributions to shareholders
Income dividends 0.11 0.11 0.20 0.22 0.19
Capital gain distributions 2.20 1.60 2.70 2.61 5.84
Subtotal: distributions to shareholders 2.31 1.71 2.90 2.83 6.03
............................................
EQUALS: Share price (NAV) at end of year 21.32 23.72 23.88 31.60 22.97
- ---------------------------------------------------------------------------------------------------------------
RATIOS (% of average net assets)
The ratios show the fund's expenses and net investment income -- as they actually are as well as how they would
have been if certain expense offset arrangements had not been in effect.
Net expenses -- actual 0.81 0.83 0.84 0.81 0.80
Expenses(1) -- -- 0.84 0.81 0.80
Net investment income -- actual 0.48 0.83 0.93 0.72 0.78
- ---------------------------------------------------------------------------------------------------------------
OTHER DATA
Total return shows how an investment in the fund would have performed over each year, assuming all
distributions were reinvested. The turnover rate reflects how actively the fund bought and sold securities.
Total return (%) 5.56 21.53 13.86 47.11 (10.03)
Net assets at end of year (in millions of dollars) 1,335.9 1,564.0 1,871.9 3,103.7 2,812.7
Portfolio turnover rate (%) 75 98 96 77 109
</TABLE>

(1) SHOWS WHAT EXPENSES WOULD HAVE
BEEN IF THERE HAD BEEN NO EXPENSE
OFFSET ARRANGEMENTS. THIS
CALCULATION IS REQUIRED FOR ALL
PERIODS ENDING AFTER 9/1/95.

Partners Fund 41
<PAGE>
[PHOTO]

NEUBERGER BERMAN
SOCIALLY RESPONSIVE FUND
- --------------------------------------------------------------------------------

Ticker Symbol: NBSRX ABOVE: PORTFOLIO MANAGER JANET PRINDLE

"WE BELIEVE THAT SOUND PRACTICES IN AREAS LIKE EMPLOYMENT AND THE ENVIRONMENT
CAN HAVE A POSITIVE IMPACT ON A COMPANY'S BOTTOM LINE. WE LOOK FOR COMPANIES
THAT MEET VALUE INVESTING CRITERIA AND ALSO SHOW A COMMITMENT TO UPHOLD OR
IMPROVE THEIR STANDARDS OF CORPORATE CITIZENSHIP."

42
<PAGE>
GOAL & STRATEGY
- ------------------------------------------------------------

SOCIAL INVESTING
Funds that follow social policies seek something in addition to economic
success. They are designed to allow investors to put their money to work and
also support companies that
follow principles of good corporate citizenship.

[ICON]
THE FUND SEEKS LONG-TERM GROWTH OF CAPITAL BY INVESTING PRIMARILY IN
SECURITIES OF COMPANIES THAT MEET THE FUND'S FINANCIAL CRITERIA AND
SOCIAL POLICY.

To pursue this goal, the fund invests mainly in common stocks of mid- to
large-capitalization companies. The fund seeks to reduce risk by investing in a
large number of companies across many different industries.

The managers initially screen companies using value investing criteria. They
look for undervalued companies with solid balance sheets, strong management,
consistent cash flows, and other value-related factors. Among companies that
meet these criteria, the managers look for those that show leadership in three
areas:

- - environmental concerns

- - diversity in the work force

- - progressive employment and workplace practices

The managers typically also look at a company's record in public health and the
nature of its products. The managers judge firms on their corporate citizenship
overall, considering their accomplishments as well as their goals. While these
judgments are inevitably subjective, the fund has a strict policy of avoiding
companies that receive more than 5% of their earnings from alcohol, tobacco,
gambling, or weapons, as well as companies that sell non-consumer products to
the military or are involved in nuclear power.

The fund has the ability to change its goal without shareholder approval,
although it does not currently intend to do so.

Socially Responsive Fund 43
<PAGE>
MAIN RISKS
- ------------------------------------------------------------

OTHER RISKS
The fund may use certain practices and securities
involving additional risks.

Borrowing, securities lending, and derivatives could create leverage, meaning
that certain gains or losses could be amplified, increasing share price
movements. These investments are not subject to the fund's social policy.

Although they may add diversification, foreign securities can be riskier,
because foreign markets tend to be more volatile and currency exchange rates
fluctuate.

The fund's social policy could cause it to underperform similar funds that do
not have a social policy. Among the reasons for this are:

- - undervalued stocks that don't meet the social criteria could outperform those
that do

- - economic or political changes could make certain companies less attractive for
investment

- - the social policy could cause the fund to sell or avoid stocks that
subsequently perform well

44 Neuberger Berman
<PAGE>
PERFORMANCE
- ------------------------------------------------------------

As a frame of reference, the table includes a broad-based market index. The
fund's performance figures include all of its expenses; the index does not
include costs of investment.

YEAR-BY-YEAR % RETURNS as of 12/31 each year

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
1988
89
90
91
92
93
94
95 38.94%
96 18.50%
97 24.41%
BEST QUARTER: Q2 '97, up 15.54%
WORST QUARTER: Q1 '97, down 1.86%
Year-to-date performance as of 9/30/98: down
4.93%
</TABLE>

AVERAGE ANNUAL TOTAL % RETURNS as of 12/31/97

<TABLE>
<CAPTION>
Since
Inception
1 Year 3/16/94
<S> <C> <C>
- --------------------------------------------------------------

SOCIALLY RESPONSIVE FUND 24.41 19.66
S&P 500 Index 33.32 24.09
</TABLE>

The S&P 500 is an unmanaged index of U.S. stocks.

Socially Responsive Fund 45
<PAGE>
INVESTOR EXPENSES
- -------------------------------------------------------------

MANAGEMENT
JANET PRINDLE, a Vice President of Neuberger Berman Management and a principal
of Neuberger Berman, LLC, joined the latter firm in 1977. She has been managing
assets using social criteria since 1990 and has been manager of the fund since
1994.

ROBERT LADD and INGRID SAUKAITIS are Assistant Vice Presidents of Neuberger
Berman Management and have been Associate Managers of the fund since 1997. Ladd
has been a portfolio manager at the firm since 1992; Saukaitis was project
director for a social research group from 1995 to 1997.

NEUBERGER BERMAN MANAGEMENT is the fund's investment adviser, and in turn
engages Neuberger Berman, LLC to provide management and related services. For
the 12 months ended 8/31/98, the management/administration fees paid to
Neuberger Berman Management were 0.81% of average net assets.

FEE TABLE

SHAREHOLDER FEES None

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

ANNUAL OPERATING EXPENSES (% of average net assets)*

These are deducted from fund assets, so you pay them indirectly.

<TABLE>
<S> <C> <C>
Management fees 0.81
PLUS: Distribution (12b-1) fees None
Other expenses 0.29
....
EQUALS: Total annual operating expenses 1.10
</TABLE>

EXPENSE EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
<S> <C> <C> <C> <C>
- -----------------------------------------------------------
Expenses $112 $350 $606 $1340
</TABLE>

46 Neuberger Berman
<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
Year Ended August 31, 1994(1) 1995 1996 1997 1998
<S> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
Data apply to a single share throughout each year indicated. You can see what the fund earned (or lost), what it distributed
to investors, and how its share price changed.
Share price (NAV) at beginning of year 10.00 10.07 11.84 13.88 17.79
PLUS: Income from investment operations
Net investment income 0.01 0.03 0.02 0.03 0.07
Net gains/losses -- realized and unrealized 0.06 1.76 2.35 4.33 (1.11)
Subtotal: income from investment operations 0.07 1.79 2.37 4.36 (1.04)
MINUS: Distributions to shareholders
Income dividends -- 0.02 0.02 0.03 0.03
Capital gain distributions -- -- 0.31 0.42 0.40
Subtotal: distributions to shareholders -- 0.02 0.33 0.45 0.43
..........................................................
EQUALS: Share price (NAV) at end of year 10.07 11.84 13.88 17.79 16.32
- -----------------------------------------------------------------------------------------------------------------------------
RATIOS (% of average net assets)
The ratios show the fund's expenses and net investment income -- as they actually are as well as how they would have been if
certain expense reimbursement/repayment and offset arrangements had not been in effect.
Net expenses -- actual 1.50(2) 1.51 1.50 1.48 1.10
Gross expenses 2.50(2)(3) 2.50(3) 1.69(3) 1.20(3) --
Expenses(4) -- -- 1.50 1.49 1.10
Net investment income -- actual 0.50(2) 0.36 0.19 0.23 0.43
- -----------------------------------------------------------------------------------------------------------------------------
OTHER DATA
Total return shows how an investment in the fund would have performed over each year, assuming all distributions were
reinvested. The turnover rate reflects how actively the fund bought and sold securities.
Total return (%) 0.70(5)(6) 17.82(6) 20.19(6) 31.96 (6.02)
Net assets at end of year (in millions of dollars) 2.3 8.2 32.9 59.7 82.5
Portfolio turnover rate (%) 14 58 53 51 47
</TABLE>

(1) PERIOD FROM 3/16/94 (BEGINNING OF OPERATIONS) TO 8/31/94.

(2) ANNUALIZED.

(3) SHOWS WHAT THIS RATIO WOULD HAVE BEEN IF THERE HAD BEEN NO EXPENSE
REIMBURSEMENT/REPAYMENT.

(4) SHOWS WHAT EXPENSES WOULD HAVE BEEN IF THERE HAD BEEN NO EXPENSE OFFSET
ARRANGEMENTS. THIS CALCULATION IS REQUIRED FOR ALL PERIODS ENDING AFTER
9/1/95.

(5) NOT ANNUALIZED.

(6) WOULD HAVE BEEN LOWER IF NEUBERGER BERMAN MANAGEMENT HAD NOT REIMBURSED
CERTAIN EXPENSES.

Socially Responsive Fund 47
<PAGE>
YOUR INVESTMENT

SHARE PRICES
- ------------------------------------------------------------

SHARE PRICE CALCULATIONS
A fund's share price is the total value of its assets minus its liabilities,
divided by the total number of shares. Because the value of a fund's securities
changes every business day, the share price usually changes as well.

When valuing portfolio securities, the funds use market prices. However, in rare
cases, events that occur after certain markets have closed may render these
prices unreliable.

When the fund believes a market price does not reflect a security's true value,
the fund may substitute for the market price a fair-value estimate made
according to methods approved by its trustees. A fund may also use these methods
to value certain types of illiquid
securities.

Because these funds do not have sales charges, the price you pay for each share
of a fund is the fund's net asset value per share. Similarly, because there are
no fees for selling shares, the fund pays you the full share price when you sell
shares.

The funds are open for business every day the New York Stock Exchange is open.
In general, every buy or sell order you place will go through at the next share
price to be calculated after your order has been accepted. Each fund calculates
its share price as of the end of regular trading on the Exchange on business
days, usually 4:00 p.m. eastern time.

Because foreign markets may be open on days when U.S. markets are closed, the
value of foreign securities owned by a fund could change on days when you can't
buy or sell fund shares. The fund's share price, however, will not change until
the next time it is calculated.

48 Neuberger Berman
<PAGE>
PRIVILEGES
AND SERVICES
- ------------------------------------------------------------

DOLLAR-COST AVERAGING
Systematic investing allows you to take advantage of the principle of
dollar-cost averaging. When you make regular investments of a given amount --
say, $100 a month -- you will end up investing at different share prices over
time. When the share price is high, your $100 buys fewer shares; when the share
price is low, your $100 buys more shares. Over time, this can help lower the
average price you pay per share.

Dollar-cost averaging cannot guarantee you a profit or protect you from losses
in a declining market. But it can be beneficial over the long term.

As a Neuberger Berman funds shareholder, you have access to a range of services
to make investing easier:

SYSTEMATIC INVESTMENTS -- This plan lets you take advantage of dollar-cost
averaging by establishing periodic investments of $100 a month or more. You
choose the schedule and amount. Your investment money may come from a Neuberger
Berman money market fund or your bank account.

SYSTEMATIC WITHDRAWALS -- This plan lets you arrange withdrawals of at least
$100 from a Neuberger Berman fund on a periodic schedule. You can also set up
payments to distribute the full value of an account over a given time. While
this service can be helpful to many investors, be aware that it could generate
capital gains or losses.

ELECTRONIC BANK TRANSFERS -- When you sell fund shares, you can have the money
sent to your bank account electronically rather than mailed to you as a check.
Please note that your bank must be a member of the Automated Clearing House, or
ACH, system. This service is not available for retirement accounts.

INTERNET ACCESS -- At www.nbfunds.com, you can make transactions, check your
account, and access a wealth of information.

FUNDFONE-REGISTERED TRADEMARK- -- Get up-to-date performance and account
information through our 24-hour automated service by calling 800-335-9366. If
you already have an account with us, you can place orders to buy, sell, or
exchange fund shares.

Your Investment 49
<PAGE>
DISTRIBUTIONS
AND TAXES
- ------------------------------------------------------------

BUYING SHARES BEFORE
A DISTRIBUTION
The money a fund earns, either as income or as capital gains, is reflected in
its share price until the fund makes a distribution. At that time, the amount of
the distribution is deducted from the share price. The amount of the
distribution is either reinvested in additional fund shares or paid to
shareholders in cash.

Because of this, if you buy shares just before a fund makes a distribution,
you'll end up getting some of your investment back as a taxable distribution.
You can avoid this situation by waiting to invest until after the distribution
has been made.

If you're investing in a tax-advantaged account, you don't need to worry;
generally, there are no tax consequences to you in this case.

DISTRIBUTIONS -- Each fund pays out to shareholders any net income and net
capital gains. Ordinarily, the funds make these distributions once a year (in
December), except for Guardian Fund, which typically distributes any income
every quarter.

Unless you tell us otherwise, your income and capital gain distributions from a
fund will be reinvested in that fund. However, if you prefer you may:

- - receive all distributions in cash

- - reinvest capital gain distributions, but receive income distributions in cash

To take advantage of one of these options, please indicate your choice on your
application.

Distributions are taxable in the year you receive them. In some cases,
distributions you receive in January are taxable as if they had been paid the
previous year. Your tax statement (see sidebar on facing page) will help clarify
this for you.

50 Neuberger Berman
<PAGE>
- ------------------------------------------------------------

TAXES AND YOU
The taxes you actually owe on distributions and transactions can vary with many
factors, such as your tax bracket, how long you held your shares, and whether
you owe alternative minimum tax.

How can you figure out your tax liability on fund distributions and
transactions? One helpful tool is the tax statement that we send you every
January. It details the distributions you received during the past year and
shows their tax status. A separate statement covers your transactions.

Most importantly, consult your tax professional. Everyone's tax situation is
different, and your professional should be able to help you answer any questions
you may have.

Income distributions and short-term capital gain
distributions are generally taxed as ordinary income. Distributions of other
capital gains are generally taxed as long-term capital gains. The tax treatment
of capital gain distributions depends on how long the fund held the securities
it sold, not when you bought your shares of the fund, or whether you reinvested
your distributions.

HOW TRANSACTIONS ARE TAXED -- When you sell fund shares, you generally realize a
gain or loss. These transactions, which include exchanges between funds, usually
have tax consequences. The exception, once again, is tax-advantaged retirement
accounts.

Your Investment 51
<PAGE>
MAINTAINING YOUR
ACCOUNT
- ------------------------------------------------------------

BACKUP WITHHOLDING
When sending in your application, it's important to provide your Social Security
or other taxpayer ID number. If we don't have this number, or if the IRS tells
us that you are subject to backup withholding, the IRS requires the fund to
withhold 31% of all money you receive from the fund, whether from selling shares
or from distributions.

If the appropriate ID number has been applied for but is not available (such as
in the case of a custodial account for a newborn), you may open the account
without a number. However, we must receive the number within 60 days in order to
avoid backup withholding. For information on custodial accounts, call
800-877-9700.

WHEN YOU BUY SHARES -- Instructions for buying shares are on pages 56 and 57.
Whenever you make an initial investment in one of the funds or add to an
existing account (except with an automatic investment), you will be sent a
statement confirming your transaction. All investments must be made in U.S.
dollars, and investment checks must be drawn on a U.S. bank.

The funds do not generally issue certificates for shares, although you can
request them. Please note, however, that the only way to redeem share
certificates is by sending in the certificates. Also, if you lose a certificate,
you will be charged a fee to replace it.

WHEN YOU SELL SHARES -- Instructions for selling shares are on pages 58 and 59.
You can place an order to sell some or all of your shares at any time. The
proceeds from the shares you sold are generally sent out the next business day
after your order is executed, and nearly always within three business days.
There are two cases in which proceeds may be delayed beyond this time:

- - in unusual circumstances where the law allows additional time if needed

- - if a check you wrote to buy shares hasn't cleared by
the time you sell those shares

If you think you may need to sell shares soon after buying them, you can avoid
the check clearing time (which may be up to 15 days) by investing by wire or
certified check.

52 Neuberger Berman
<PAGE>
- ------------------------------------------------------------

SIGNATURE GUARANTEES
A signature guarantee is a guarantee that your signature is authentic.

Most banks, brokers, and other financial institutions can provide you with one.
Some may charge a fee; others may not, particularly if you are a customer of
theirs.

A notarized signature from a notary public is not a signature guarantee.

In some cases, you will have to place your order to sell shares in writing, and
you will need a signature guarantee (see sidebar). These cases include:

- - when selling more than $50,000 worth of shares

- - when you want the check for the proceeds to be made out to someone other than
an owner of record, or sent somewhere other than the address of record

- - when you want the proceeds sent by wire or
electronic transfer to a bank account you have not designated in advance

When selling shares in an account that you do not intend to close, be sure to
leave at least $1,000 worth of shares in the account. Otherwise, the fund has
the right to request that you bring the balance back up to the minimum level. If
you have not done so within 60 days, we may close your account and send you the
proceeds by mail.

UNCASHED CHECKS -- We do not pay interest on uncashed checks from fund
distributions or the sale of fund shares. We are not responsible for checks
after they are sent to you. After allowing a reasonable time for delivery,
please call us if you have not received an expected check. While we cannot track
a check, we may make arrangements for a replacement.

STATEMENTS AND CONFIRMATIONS -- Please review your account statements and
confirmations carefully as soon as you receive them. You must contact us within
30 days if you have any questions or notice any discrepancies. Otherwise, you
may adversely affect your right to make a claim about the transaction(s).

Your Investment 53
<PAGE>
MAINTAINING YOUR
ACCOUNT CONTINUED
- -------------------------------------------------------------------

FUND STRUCTURE
Each of the funds in this prospectus uses a "master/feeder" structure.

Rather than investing directly in securities, each fund is a "feeder fund,"
meaning that it invests in a corresponding "master portfolio." The master
portfolio in turn invests in securities, using the strategies described in this
prospectus. One potential benefit of this structure is lower costs, since the
expenses of the master portfolio can be shared with any other feeder funds. In
this prospectus, we have used the word "fund" to mean a feeder fund and its
master portfolio.

For reasons relating to costs or a change in investment goal, among others, a
feeder fund could switch to another master portfolio or decide to manage its
assets itself. No fund in this prospectus is currently contemplating such a
move.

WHEN YOU EXCHANGE SHARES -- You can move money from one Neuberger Berman fund to
another through an exchange of shares. There are three things to remember when
making an exchange:

- - both accounts must have the same registration

- - you will need to observe the minimum investment and minimum account balance
requirements for the fund accounts involved

- - because an exchange is a sale for tax purposes, consider any tax consequences
before placing your order

The exchange program is available to all shareholders in the funds, but can be
withdrawn from any investor that we believe is trying to "time the market" or is
otherwise making exchanges that we judge to be excessive. Frequent exchanges can
interfere with fund management and affect costs and performance for other
shareholders.

PLACING ORDERS BY TELEPHONE -- Neuberger Berman fund investors have the option
of placing telephone orders to buy, sell, or exchange shares. On non-retirement
accounts, this option is available to you unless you indicate on your account
application (or in a subsequent letter to us or to State Street Bank and Trust
Company) that you don't want it.

Whenever we receive a telephone order, we take steps to make sure the order is
legitimate. These may include asking for identifying information and recording
the call. As long as a fund and its representatives

54 Neuberger Berman
<PAGE>
- ------------------------------------------------------------

EURO AND YEAR 2000
ISSUES
Like other mutual funds, the funds could be affected by problems relating to the
conversion of European currencies into the Euro beginning 1/1/99 and the ability
of computer systems to recognize the Year 2000.

At Neuberger Berman, we are taking steps to ensure that our own computer systems
are compliant with Euro and Year 2000 issues and to determine that the systems
used by our major service providers are also compliant. We are also making
efforts to determine whether companies in the funds' portfolios will be
affected by either issue.

At the same time, it is impossible to know whether these problems, which could
disrupt fund operations and investments if uncorrected, have been adequately
addressed until the dates in question arrive.

take reasonable measures to verify the authenticity of calls, investors may be
responsible for any losses caused by unauthorized telephone orders.

In unusual circumstances, it may be difficult to place an order by phone. In
these cases, consider sending your order by fax or express delivery.

OTHER POLICIES -- Under certain circumstances, the funds reserve the right to:

- - suspend the offering of shares

- - reject any exchange or investment order

- - change, suspend, or revoke the exchange privilege

- - suspend the telephone order privilege

- - satisfy an order to sell fund shares with securities rather than cash, for
certain very large orders

- - suspend or postpone your right to sell fund shares on days when trading on the
New York Stock Exchange is restricted, or as otherwise permitted by the SEC

- - change its investment minimums or other requirements for buying and selling,
or waive any minimums or requirements for certain investors

Your Investment 55
<PAGE>
BUYING SHARES

Method Things to know

- -----------------------------------------------------------------------------
SENDING US A CHECK

Your first investment must be at least $1,000

Additional investments can be as little as $100

We cannot accept cash, money orders, starter checks, or travelers checks

You will be responsible for any losses or fees resulting from a bad check; if
necessary, we may sell other shares belonging to you in order to cover these
losses

All checks must be made out to "Neuberger Berman Funds;" we cannot accept checks
made out to you or other parties and signed over to us

- -----------------------------------------------------------------------------
WIRING MONEY

All wires must be for at least $1,000

- -----------------------------------------------------------------------------
EXCHANGING FROM
ANOTHER FUND

All exchanges must be for at least $1,000

Both accounts involved must be registered in the same name, address and tax ID
number

An exchange order cannot be cancelled or changed once it has been placed

- -----------------------------------------------------------------------------
CALLING IN YOUR ORDER
(with follow-up payment)

All phone investment orders must be for at least $1,000

The money for your shares must be received within three days after you place
your order, or your order may be cancelled

You will be responsible for any losses or fees resulting from a cancelled order;
if necessary, we may sell other shares belonging to you in order to cover these
losses

Not available on retirement accounts

- -----------------------------------------------------------------------------
SETTING UP SYSTEMATIC
INVESTMENTS

All investments must be at least $100

56 Neuberger Berman
<PAGE>
RETIREMENT PLANS
We offer investors a number of tax-advantaged plans for retirement saving:

TRADITIONAL IRAS allow money to grow tax-deferred until you take it out at
retirement. Contributions are deductible for some investors, but even when
they're not, an IRA can be beneficial.

ROTH IRAS offer tax-free growth like a traditional IRA, but instead of
tax-deductible contributions, the withdrawals are tax-free for investors who
meet certain requirements.

Also available: SEP-IRA, SIMPLE, Keogh, and other types of plans. Consult your
tax professional to find out which types of plans may be beneficial for you,
then call 800-877-9700 for information on any Neuberger Berman retirement plan.

Instructions

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

Fill out the application and enclose your check

If regular first-class mail, address to:
NEUBERGER BERMAN FUNDS
BOSTON SERVICE CENTER
P.O. BOX 8403
BOSTON, MA 02266-8403

If express delivery, registered mail, or certified mail, send to:
NEUBERGER BERMAN FUNDS
C/O STATE STREET BANK AND TRUST COMPANY
66 BROOKS DRIVE
BRAINTREE, MA 02184-3839

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

Before wiring any money, call 800-877-9700 for an order confirmation

Have your financial institution send your wire to State Street Bank and Trust
Company

Include your name, the fund name, your account number and other information as
requested

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

Call 800-877-9700 to place your order

To place an order using FUNDFONE-Registered Trademark-, call 800-335-9366

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

Call 800-877-9700 to place your order

Follow up with a wire, electronic transfer, or check
(via express delivery)

To add shares to an existing account using FUNDFONE-Registered Trademark-, call
800-335-9366

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

Call 800-877-9700 for instructions

Your Investment 57
<PAGE>
SELLING SHARES

Method Things to know

- -----------------------------------------------------------------------------
SENDING US A LETTER

Unless you tell us otherwise, we will mail your proceeds by check to the address
of record, payable to the registered owner(s)

If you have designated a bank account on your application, you can request that
we wire the proceeds to this account; if the total balance in all of your
Neuberger Berman fund accounts is less than $200,000, you will be charged an
$8.00 fee

You can also request that we send the proceeds to your designated bank account
by electronic transfer without fee

You may need a signature guarantee (see page 53)

- -----------------------------------------------------------------------------
SENDING US A FAX

For amounts of up to $50,000

Not available if you have changed the address on the account by phone, fax, or
postal address change in the past 15 days

- -----------------------------------------------------------------------------
CALLING IN YOUR ORDER

All phone orders to sell shares must be for at least $1,000, unless you are
closing out an account

Not available if you have declined the phone option or are selling shares in a
retirement account

Not available if you have changed the address on the account by phone, fax, or
postal address change in the past 15 days

- -----------------------------------------------------------------------------
EXCHANGING INTO
ANOTHER FUND

All exchanges must be for at least $1,000

Both accounts involved must be registered in the same name, address and tax ID
number

An exchange order cannot be cancelled or changed once it has been placed

- -----------------------------------------------------------------------------
SETTING UP SYSTEMATIC
WITHDRAWALS

For accounts with at least $5,000 worth of shares in them

Withdrawals must be at least $100

58 Neuberger Berman
<PAGE>
INTERNET CONNECTION
Investors with Internet access can enjoy many valuable and time-saving features
by visiting us on the World Wide Web at www.nbfunds.com.

The site offers complete information on our funds, current performance data, and
an Investment Education Center with interactive worksheets for college and
retirement planning. Also available are relevant news items, tax information,
portfolio manager interviews, and related articles.

As a Neuberger Berman funds shareholder, you can use the web site to access
account information and even make secure transactions -- 24 hours a day.

Instructions

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

Send us a letter requesting us to sell shares signed by all registered owners;
include your name, account number, the fund name, the dollar amount or number of
shares you want to sell, and any other instructions

If regular first-class mail, send to:
NEUBERGER BERMAN FUNDS
BOSTON SERVICE CENTER
P.O. BOX 8403
BOSTON, MA 02266-8403

If express delivery, registered mail, or certified mail, send to:
NEUBERGER BERMAN FUNDS
C/O STATE STREET BANK AND TRUST COMPANY
66 BROOKS DRIVE
BRAINTREE, MA 02184-3839

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

Draw up a request to sell shares as described above

Fax it to 212-476-8848

Call 800-877-9700 to make sure your fax arrived and is in order

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

Call 800-877-9700 to place your order

Give your name, account number, the fund name, the dollar amount or number of
shares you want to sell, and any other instructions

To place an order using FUNDFONE-Registered Trademark-, call 800-335-9366

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

Call 800-877-9700 to place your order

To place an order using FUNDFONE-Registered Trademark-, call 800-335-9366

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

Call 800-877-9700 for instructions

Your Investment 59
<PAGE>
- -------------------------------------------------------------------

NOTES

60
<PAGE>
- --------------------------------------------

61
<PAGE>
[PHOTO]
[SOLID BAR]

OBTAINING INFORMATION
You can obtain a shareholder report, SAI, and other information from:

NEUBERGER BERMAN
MANAGEMENT INC.
605 Third Avenue 2nd floor
New York, NY 10158-0180

800-877-9700
212-476-8800

Web site:
www.nbfunds.com
Email:
[email protected]

SECURITIES AND EXCHANGE COMMISSION
Washington, DC
20549-6009
800-SEC-0330 (Public
Reference Section)

Web site:
www.sec.gov

You can request copies of documents from the SEC for the cost of a duplicating
fee, or view documents at the SEC's Public Reference Room in Washington.

NEUBERGER BERMAN EQUITY FUNDS

- - No load

- - No sales charges

- - No 12b-1 fees

If you'd like further details on any of these funds, you can request a free copy
of the following documents:

SHAREHOLDER REPORTS -- Published twice a year, the shareholder reports offer
information about the fund's recent performance, including:

- - a discussion by the portfolio manager(s) about strategies and market
conditions

- - fund performance data and financial statements

- - complete portfolio holdings

STATEMENT OF ADDITIONAL INFORMATION -- The SAI contains more comprehensive
information on these funds, including:

- - various types of securities and practices, and their risks

- - investment limitations and additional policies

- - information about each fund's management and business structure

The SAI is incorporated by reference into this prospectus, making it legally
part of the prospectus.

Investment manager:
NEUBERGER BERMAN MANAGEMENT INC.
Sub-adviser:
NEUBERGER BERMAN, LLC

[LOGO]

NEUBERGER BERMAN MANAGEMENT INC.
605 Third Avenue
New York, NY 10158-0180

[RECYCLE LOGO] NMLRR1261298 SEC file number: 811-582

<PAGE>

<PAGE>
[] NEUBERGER BERMAN
[PHOTO]

NEUBERGER BERMAN
EQUITY FUNDS-REGISTERED TRADEMARK-
- --------------------------------------------------------------------------------
PROSPECTUS DECEMBER 30, 1998

Third Party Prospectus

Focus Fund
Genesis Fund
Guardian Fund
International Fund
Manhattan Fund
Millennium Fund
Partners Fund
Socially Responsive Fund
<PAGE>
CONTENTS

<TABLE>
<C> <S>
NEUBERGER BERMAN EQUITY FUNDS

PAGE 2 ...... Focus Fund

8 ...... Genesis Fund

14 ...... Guardian Fund

20 ...... International Fund

26 ...... Manhattan Fund

32 ...... Millennium Fund

36 ...... Partners Fund

42 ...... Socially Responsive Fund

YOUR INVESTMENT

48 ...... Maintaining Your Account

50 ...... Share Prices

51 ...... Distributions and Taxes

53 ...... Fund Structure
</TABLE>

RISK INFORMATION
This prospectus discusses principal risks of investment in fund shares. These
and other risks are discussed in detail in the Statement of Additional
Information (see back cover).

THESE FUNDS:

- - ARE DESIGNED FOR INVESTORS WITH LONG-TERM GOALS IN MIND

- - OFFER YOU THE OPPORTUNITY TO PARTICIPATE IN FINANCIAL MARKETS THROUGH
PROFESSIONALLY MANAGED STOCK PORTFOLIOS

- - ALSO OFFER THE OPPORTUNITY TO DIVERSIFY YOUR PORTFOLIO WITH FUNDS THAT INVEST
USING A VALUE OR A GROWTH APPROACH, OR A COMBINATION OF THE TWO

- - USE A MASTER/FEEDER STRUCTURE IN THEIR PORTFOLIOS; SEE PAGE 53 FOR INFORMATION
ON HOW IT WORKS