As filed with the Securities and Exchange Commission on August 7, 2000
File Nos. 333-40090
811-582
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------------------------
FORM N-14
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. |1| Post-Effective Amendment No. |_|
(Check appropriate box or boxes)
Neuberger Berman Equity Funds
(Exact name of registrant as specified in charter)
605 Third Avenue
NEW YORK, NEW YORK 10158-0180
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (212) 476-8800
Peter E. Sundman, Chief Executive Officer
Neuberger Berman Equity Funds
605 Third Avenue, 2nd Floor
New York, New York 10158-0180
Arthur C. Delibert, Esq.
Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, N.W.
Washington, D.C. 20036-1800
(Names and Addresses of Agents for Service of Process)
The registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant shall
file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with section 8(a) of
the Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission acting pursuant to said section 8(a),
may determine.
For the new shares of Neuberger Equity Funds, the approximate date of
the proposed public offering is December 15, 2000. The public offering of shares
of Registrant's series is on-going. The title of securities being registered is
shares of beneficial interest.
Neuberger Berman Equity Funds is a "master/feeder fund." This
Registration Statement includes signature pages for the master fund, Equity
Managers Trust, and appropriate officers and trustees thereof.
<PAGE>
NEUBERGER BERMAN EQUITY FUNDS
FORM N-14
CONTENTS OF REGISTRATION STATEMENT ON FORM N-14
This Registration Statement consists of the following papers and
documents:
Cover Sheet
Contents of Registration Statement on Form N-14
Neuberger Berman Equity Funds
Part A - Prospectus and Information Statement
Part B - Statement of Additional Information
Part C - Other Information
Signature Pages
Exhibits
<PAGE>
NEUBERGER BERMAN EQUITY FUNDS
NEUBERGER BERMAN EQUITY TRUST
NEUBERGER BERMAN EQUITY ASSETS
NEUBERGER BERMAN EQUITY SERIES
NEUBERGER BERMAN INCOME FUNDS
NEUBERGER BERMAN INCOME TRUST
August 15, 2000
Dear Shareholder:
The attached Combined Proxy Statement and Prospectus discusses several Proposals
to be voted upon by the holders of certain Neuberger Berman funds. As a
shareholder of the funds, you are asked to review the Combined Proxy Statement
and Prospectus and to cast your vote on the Proposals that relate to the funds
you own. THE BOARDS OF TRUSTEES OF THE NEUBERGER BERMAN (NB) FUNDS UNANIMOUSLY
RECOMMEND A VOTE FOR ALL OF THE PROPOSALS.
The goal of one of the proposals is to make the funds more efficient to operate
and the structure easier to understand. Other proposals would allow certain
funds greater investment flexibility; one authorizes certain funds to adopt a
distribution and shareholder services plan.
YOUR VOTE IS IMPORTANT TO US. VOTING YOUR SHARES EARLY WILL PERMIT THE FUNDS TO
AVOID COSTLY FOLLOW-UP MAIL AND TELEPHONE SOLICITATION. After reviewing the
attached materials, please complete, sign and date your proxy card and mail it
promptly in the enclosed postage paid envelope, or help us save time and postage
costs by voting on the Internet or by telephone - instructions can be found on
your proxy card. If we do not hear from you by September 7, our proxy solicitor
may contact you.
If you have any questions, please call 1-800-877-9700. Our representatives will
be glad to assist you. Thank you for your response and your continued support of
the Neuberger Berman funds.
Very truly yours,
/s/ Peter Sundman
-----------------------------
Peter Sundman
President
Neuberger Berman Management Inc.
<PAGE>
NEUBERGER BERMAN EQUITY FUNDS
NEUBERGER BERMAN EQUITY TRUST
NEUBERGER BERMAN EQUITY ASSETS
NEUBERGER BERMAN EQUITY SERIES
(INCLUDING, WHERE APPLICABLE, THE CENTURY, FOCUS, GENESIS, GUARDIAN,
INTERNATIONAL,MANHATTAN, MILLENNIUM, PARTNERS, REGENCY, SOCIALLY RESPONSIVE AND
TECHNOLOGY SERIES)
(EACH A "FUND")
NEUBERGER BERMAN INCOME FUNDS
NEUBERGER BERMAN INCOME TRUST
(INCLUDING, WHERE APPLICABLE, THE CASH RESERVES, GOVERNMENT MONEY FUND, HIGH
YIELD BOND FUND, MUNICIPAL MONEY FUND AND MUNICIPAL SECURITIES TRUST AND THE
INSTITUTIONAL CASH AND LIMITED MATURITY BOND SERIES)
(EACH A "FUND")
------------------------
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON OCTOBER 31, 2000
------------------------
WHO IS ASKING FOR YOUR VOTE?
The Board of Trustees of your fund.
WHERE WILL THE MEETING BE HELD?
The meeting will be held at the offices of Neuberger Berman, 605 Third Avenue,
41st Floor, New York, New York 10158-3698, on October 31, 2000 at 10:30 a.m.
Eastern time.
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<PAGE>
WHAT PROPOSALS APPLY TO EACH FUND?
The following table summarizes each proposal to be presented at the meeting and
the funds whose shareholders the Board is soliciting with respect to each
proposal:
-------------------------------------------------------------------------------
Name of Fund Proposals
-------------------------------------------------------------------------------
NB Cash Reserves 1. To elect Trustees
2. To approve a change in the fundamental
investment limitation on diversification
3. To ratify the selection of independent
auditor/accountants
6. To approve a on the fundamental
restriction on industry concentration
-------------------------------------------------------------------------------
NB Century Fund 1. To elect Trustees
NB Focus Fund 2. To approve a change in the fundamental
NB Genesis Fund investment limitation on diversification
NB Guardian Fund 3. Ratifying selection of independent
NB High Yield Bond Fund auditor/accountants
NB International Fund
NB Limited Maturity Bond Fund
NB Manhattan Fund
NB Millennium Fund
NB Municipal Money Fund
NB Municipal Securities Trust
NB Partners Fund
NB Regency Fund
NB Socially Responsive Fund
NB Technology Fund
-------------------------------------------------------------------------------
NB Government Money Fund 1. To elect Trustees
2. To approve a change in the fundamental
investment limitation on diversification
3. To ratify the selection of independent
auditor/accountants
7. To modify the fund's fundamental
restrictions on:
A. Investing in government securities
B. Repurchase Agreements
C. Borrowing policy to permit purchase of
reverse repurchase agreements
D. To permit securities lending
-------------------------------------------------------------------------------
NB Century Trust 1. To elect Trustees
NB Focus Trust 2. To approve a change in the fundamental
NB International Trust investment limitation
NB Institutional Cash Trust 3. To ratify the selection of independent
NB Limited Maturity Bond Trust auditor/accountants
NB Manhattan Trust 4. To Approve an Agreement and Plan of
Reorganization
-------------------------------------------------------------------------------
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<PAGE>
-------------------------------------------------------------------------------
Name of Fund Proposals
-------------------------------------------------------------------------------
NB Millennium Trust 1. To elect Trustees
NB Regency Trust 2. To approve a change in the fundamental
investment limitation on diversification
NB Socially Responsive Trust 3. To ratify the selection of independent
auditor/accountants
NB Technology Trust
4. To Approve an Agreement and Plan of
Reorganization
-------------------------------------------------------------------------------
NB Genesis Trust 1. To elect Trustees
NB Guardian Trust 2. To change the fundamental investment
limitation on diversification
NB Partners Fund 3. To ratify the selection of independent
auditor/accountants
4. To approve an Agreement and Plan of
Reorganization
5. To approve a plan of distribution and
shareholder services
--------------------------------------------------------------------------------
NB Focus Assets 1. To elect of Trustees
NB Genesis Assets 2. To approve a change in the fundamental
NB Guardian Assets investment limitation on diversification
NB Manhattan Assets 3. To ratify the selection of independent
NB Millennium Assets auditor/accountants
NB Partners Assets 4. To approve an Agreement and Plan of
NB Socially Responsive Assets Reorganization
--------------------------------------------------------------------------------
EACH PROPOSAL IS DISCUSSED IN GREATER DETAIL IN THE ATTACHED PROXY STATEMENT.
WHO IS ELIGIBLE TO VOTE?
You are entitled to vote at the meeting and any adjournment if you owned shares
of one or more funds at the close of business on AUGUST 15, 2000.
---------------
WHAT ARE THE DIFFERENT WAYS TO VOTE THIS PROXY?
There are a number of ways to vote your shares:
o BY MAIL: You may vote by completing the enclosed proxy card by dating,
signing and returning it in the postage paid envelope. PLEASE NOTE THAT
IF YOU SIGN AND DATE THE PROXY CARD(S) BUT GIVE NO VOTING INSTRUCTIONS,
YOUR SHARES WILL BE VOTED "FOR" THE PROPOSALS DESCRIBED ABOVE.
o BY PHONE: You may vote by telephone by calling the number on your proxy
card.
o VIA THE INTERNET: You may vote through the Internet by visiting the
website on your proxy card.
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<PAGE>
o IN PERSON: If you plan to attend the meeting, you may vote in person.
(PLEASE NOTE, THAT IF YOU VOTE A PROXY AND THEN VOTE IN PERSON AT THE
MEETING, YOUR PROXY IS AUTOMATICALLY REVOKED.) IF YOU PLAN TO ATTEND
THE MEETING, PLEASE CALL THE FUNDS AT (800) 877-9700.
If you own shares of more than one fund, you must submit a separate proxy
card for each fund in which you own shares. Unless proxy cards submitted by
corporations and partnerships are signed by the appropriate persons as indicated
in the voting instructions on the proxy cards, they will not be voted.
Any additional proposals submitted to a vote at the meeting by anyone other
than the officers or Trustees of the funds may be voted only in person or by
written proxy.
By order of the Board of Trustees,
/S/ Claudia A. Brandon
------------------------------------
Claudia A. Brandon
Secretary
Neuberger Berman Equity Funds
Neuberger Berman Equity Trust
Neuberger Berman Equity Assets
Neuberger Berman Equity Series
Neuberger Berman Income Funds
Neuberger Berman Income Trust
August 15, 2000
New York, New York
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<PAGE>
NEUBERGER BERMAN EQUITY FUNDS
NEUBERGER BERMAN EQUITY TRUST
NEUBERGER BERMAN EQUITY ASSETS
NEUBERGER BERMAN EQUITY SERIES
NEUBERGER BERMAN INCOME FUNDS
NEUBERGER BERMAN INCOME TRUST
605 Third Avenue, 2nd Floor
New York, New York 10158-0180
800-877-9700
COMBINED PROXY STATEMENT AND PROSPECTUS
This Combined Proxy Statement and Prospectus, which includes a Notice of
Special Meeting of Shareholders, a Proxy Statement and one or more Proxy Cards,
is for the special meeting of shareholders of the Neuberger Berman Equity group
of funds (Neuberger Berman Equity Funds, Equity Trust, Equity Assets, and Equity
Series) and the Neuberger Berman Income group of funds (Neuberger Berman Income
Funds and Income Trust), to be held on October 31, 2000, and any adjournment
thereof ("Meeting").
This Combined Proxy Statement and Prospectus contains information about
several proposals that relate to the Neuberger Berman funds. Some proposals
relate to some of the funds but not others, so depending on which funds you own,
you may not be asked to vote on all of the proposals.
PROPOSAL 1 (APPLIES TO ALL SHAREHOLDERS OF ALL THE FUNDS): To elect Trustees to
serve on the Board of Trustees until their successors are duly elected and
qualified.
PROPOSAL 2 (APPLIES TO ALL SHAREHOLDERS OF ALL THE FUNDS): To approve a change
in a fundamental investment limitation.
PROPOSAL 3 (APPLIES TO ALL SHAREHOLDER OF ALL THE FUNDS): To ratify the
selection of independent auditors or accountants for each fund.
PROPOSAL 4 (APPLIES TO SHAREHOLDERS OF: NB CENTURY TRUST
NB FOCUS TRUST AND NB FOCUS ASSETS
NB GENESIS TRUST, NB GENESIS ASSETS AND
NB GENESIS INSTITUTIONAL
NB GUARDIAN TRUST AND NB GUARDIAN ASSETS
NB INSTITUTIONAL CASH TRUST
NB INTERNATIONAL TRUST
NB LIMITED MATURITY BOND TRUST
NB MANHATTAN TRUST AND NB MANHATTAN
ASSETS
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<PAGE>
NB MILLENNIUM TRUST AND NB MILLENNIUM
ASSETS
NB PARTNERS TRUST AND NB PARTNERS ASSETS
NB REGENCY TRUST
NB SOCIALLY RESPONSIVE TRUST AND NB
SOCIALLY RESPONSIVE ASSETS
NB TECHNOLOGY TRUST):
To approve an Agreement and Plan of Reorganization ("Reorganization Plan")
providing for the reorganization of each fund from the current two-level
master-feeder structure to a single-level multi-class structure.
PROPOSAL 5 (APPLIES TO SHAREHOLDERS OF NB GENESIS TRUST, NB GUARDIAN TRUST AND
NB PARTNERS TRUST): To approve a distribution and shareholder services plan to
authorize each fund to spend annually 0.10% of average daily net assets to
obtain distribution and/or shareholder services.
PROPOSAL 6 (APPLIES TO SHAREHOLDERS OF NB CASH RESERVES): To approve a change to
the fund's fundamental restriction on industry concentration to permit
concentration in the financial services group of industries.
PROPOSAL 7 (APPLIES TO SHAREHOLDERS OF NB GOVERNMENT MONEY FUND): To approve a
change in the fund's fundamental policies to (A) permit the fund to invest in
all securities issued or guaranteed as to principal or interest by the U.S.
Government, its agencies or instrumentalities; (B) permit the fund to invest in
repurchase agreements in an effort to earn more income; (C) modify the fund's
borrowing policy to permit the fund to use reverse repurchase agreements; and
(D) modify the fund's lending policy to permit the fund to loan portfolio
securities.
THE REORGANIZATION. The proposed Reorganization would not alter your
current investment program. It would simply change the operational structure
of the Neuberger Berman funds, so that they may benefit from certain
efficiencies and cost savings. The funds would be changing to a structure that
is more common in the mutual fund industry.
Like your current fund, the new single-level fund is an open-end,
management investment company comprised of a group of diversified series. These
series have investment programs that are identical to the similarly named series
of your current fund. Unlike your current fund, however, each series of the new
fund has classes of shares. After the Reorganization, you will hold shares of
the class that corresponds to your current fund.
If you are a shareholder of Neuberger Berman Equity Trust, Equity Series
or Equity Assets, then after the Reorganization, you will hold class shares of a
corresponding series of NEUBERGER BERMAN EQUITY FUNDS. For example, if you
currently hold shares of Guardian Trust, after the Reorganization you will hold
Trust Class shares of the Guardian series of Neuberger Berman Equity Funds.
- 7 -
<PAGE>
Likewise, if you are a shareholder of Neuberger Berman Income Trust, then
after the Reorganization, you will hold Trust class shares of a corresponding
series of NEUBERGER BERMAN INCOME FUNDS.
If you approve the Agreement and Plan of Reorganization ("Reorganization
Plan") your fund would become part of a new single-level fund that invests its
assets directly in the securities markets. The new fund would have classes of
shares that would correspond to the current feeder funds. The investment
program, management arrangements, and operations of the new single-level fund
would be identical to those of your present fund, and your rights as a
shareholder would remain essentially unchanged.
The Board of Trustees of each fund that proposes to participate in the
Reorganization and Neuberger Berman Management Inc. ("NBMI"), the funds'
investment manager, administrator and distributor, believe that the
Reorganization:
o may produce in certain administrative efficiencies and cost savings for
the funds,
o may enhance its ability to market and sell shares of the funds by
utilizing the more common multi-class structure
This Combined Proxy Statement and Prospectus sets forth concisely the
information that a shareholder of the funds should know before voting on the
proposed Reorganization and other actions. It should be read and retained for
future reference. The current prospectuses of Neuberger Berman Equity Funds,
dated December 1, 1999, and Neuberger Berman Income Funds, dated March 1, 2000,
are incorporated by reference into (and legally a part of) Proposal 4 of this
Combined Proxy Statement and Prospectus. If you are being asked to vote on
Proposal 4, copies of the prospectuses are enclosed for your reference.
(Shareholders of Equity Funds and Income Funds are not receiving prospectuses
because you are not voting on Proposal 4 and because you have already received
one or both as current shareholders. You may request another prospectus by
contacting the funds at the address or telephone number below.)
Additional information about Neuberger Berman Equity Funds and Income
Funds appears in the funds' Statements of Additional Information dated December
1, 1999, which are also incorporated by reference into this Combined Proxy
Statement and Prospectus. The Statements of Additional Information are available
without charge by writing the Neuberger Berman Funds at 605 Third Avenue, 2nd
Floor New York, New York 10158-0180, or calling at 800-877-9700.
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED
THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- 8 -
<PAGE>
VOTING INFORMATION
The Boards of Trustees of Neuberger Berman Equity Funds, Equity Trust,
Equity Assets and Equity Series, and the Boards of Trustees of Neuberger Berman
Income Funds and Income Trust (each a "Trust" and collectively, the "Trusts")
are asking you to sign the enclosed proxy card(s) for use at a Special Meeting
of Shareholders of the funds listed on the front cover, to be held on October
31, 2000 at 10:30 a.m. Eastern time, at the offices of Neuberger Berman, LLC,
605 Third Avenue, 41st Floor, New York, New York 10158-3698, and at any
adjournments thereof (the "Meeting"). This combined Proxy Statement and
Prospectus is first being mailed on or about August 15, 2000.
One-third of each fund's shares outstanding and entitled to vote on August
15, 2000 ("Record Date"), represented in person or by proxy, make up a quorum
and must be present for the transaction of business at the Meeting with respect
to that fund. Shares of all funds that make up a single Trust will vote together
for the election of Trustees (Proposal 1), and the presence of one-third of an
entire Trust constitutes a quorum for purposes of that proposal. Each fund's
shareholders will vote separately on each other Proposal with respect to that
fund; if you are a shareholder of more than one fund, you will be voting on each
such Proposal separately with respect to each fund in which you hold shares.
If a quorum is not present at the Meeting or a quorum is present but
sufficient votes to approve any Proposal are not received, or for any other
reason, the persons named as proxies may propose one or more adjournments of the
Meeting to permit further solicitation of proxies. Any such adjournment will
require the affirmative vote of those shares voting at the Meeting in person or
by proxy. The persons named as proxies will vote those proxies that they are
entitled to vote FOR any proposal in favor of such an adjournment and will vote
those proxies required to be voted AGAINST a proposal against such adjournment.
A shareholder vote may be taken on any one or more of the Proposals in this
Combined Proxy Statement and Prospectus prior to such adjournment if sufficient
votes have been received for approval and it is otherwise appropriate.
If the enclosed proxy is properly executed and returned in time to be voted
at the Meeting, the shares represented by the proxy will be voted in accordance
with the instructions marked on the proxy card. If no instructions are marked on
the proxy card, the proxy will be voted FOR each Proposal described in the
accompanying Notice of Special Meeting of Shareholders and FOR the election of
each candidate nominated by the Board to serve as a Trustee. Proxies that
reflect "broker non-votes" (I.E., shares held by brokers or nominees as to which
(i) instructions have not been received from the beneficial owners or the
persons entitled to vote and (ii) the broker or nominee does not have
discretionary voting power on a particular matter) will not be counted for
purposes of determining a quorum and will have no effect on the outcome of the
Proposals. Abstentions will be counted as shares that are present and entitled
to vote for purposes of determining the presence of a quorum and will have a
negative effect on the Proposals. For shares held in individual retirement
accounts (IRA, Roth IRA or SIMPLE Retirement plans), the IRA Custodian shall
vote the shares in the account in accordance with instructions given by the
Depositor. However, if the Depositor fails to provide instructions on how to
vote the shares in the account, the Custodian shall vote the undirected shares
in the same proportion as shares are voted considering all shares of the fund
for which instructions are received.
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<PAGE>
Any shareholder who has given a proxy has the right to revoke it any time
prior to its exercise by attending the Meeting and voting his or her shares in
person, or by submitting a letter of revocation or a later-dated proxy to the
relevant Trust at the address indicated on the enclosed envelope provided with
this Proxy Statement. Any letter of revocation or later-dated proxy must be
received by the Trust prior to the Meeting and must indicate your name and
account number to be effective. Proxies voted by telephone or Internet may be
revoked at any time before they are voted at the Meeting in the same manner that
proxies voted by mail may be revoked.
Proxy solicitations will be made primarily by mail, but may also be made by
telephone, electronic transmission or personal meetings with officers and
employees of NBMI, affiliates of NBMI or other representatives of the Funds.
NBMI serves as principal underwriter and administrator of the Funds. NBMI and
its affiliates will not receive any compensation from the Fund for proxy
solicitation activities. Proxy solicitations may also be made by our proxy
solicitor. If votes are recorded by telephone, our proxy solicitor will use
procedures designed to authenticate shareholders' identities, to allow
shareholders to authorize the voting of their shares in accordance with their
instructions, and to confirm that a shareholder's instructions have been
properly recorded. You may also vote by mail or through a secure Internet site.
The cost of solicitation and the expenses incurred in connection with preparing
this Proxy Statement and its enclosures will be paid by the funds. PLEASE NOTE
THAT WHILE PROXIES MAY BE VOTED BY TELEPHONE OR THROUGH THE INTERNET WITH
RESPECT TO EACH PROPOSAL, ANY PROPOSAL SUBMITTED TO A VOTE AT THE MEETING BY
ANYONE OTHER THAN THE OFFICERS OR TRUSTEES OF THE TRUSTS MAY BE VOTED ONLY IN
PERSON OR BY WRITTEN PROXY.
For soliciting services, our proxy solicitor will be paid fees and expenses
of up to approximately $6,079, $311,209, $133,512, $520,036, $32,724, $154,645,
$46,082, $427,048, $1,856, $19,737, and $1,884 for Neuberger Berman Century,
Focus, Genesis, Guardian, International, Manhattan, Millennium, Partners,
Regency, Socially Responsive and Technology Funds, respectively. Our proxy
solicitor will be paid fees and expenses of up to approximately $457, $70,711,
$180,355, $290,874, $1,006, $25,895, $3,653, $174,892, $6,186, $7,406, and $446
for Neuberger Berman Century, Focus, Genesis, Guardian, International,
Manhattan, Millennium, Partners, Regency, Socially Responsive and Technology
Trust, respectively. Our proxy solicitor will be paid fees and expenses of up to
approximately $2,397, $33,200, $9,642, $1,426, $48, $19,000, and $77 for
Neuberger Berman Focus, Genesis, Guardian, Manhattan, Millennium, Partners and
Socially Responsive Assets, respectively. Our proxy solicitor will be paid fees
and expenses of up to approximately $0 for Neuberger Berman Genesis
Institutional.
For soliciting services, our proxy solicitor will be paid fees and expenses
of up to approximately $69,269, $21,233, $790, $10,913, $17,147, and $1,704 for
Neuberger Berman Cash Reserves, Government Money Fund, High Yield Bond Fund,
Limited Maturity Bond Fund, Municipal Money Fund and Municipal Securities Trust,
respectively. Our proxy solicitor will be paid fees and expenses of up to
approximately $20,563 and $ 9,967 for Neuberger Berman Limited Maturity Bond and
Institutional Cash Trust, respectively.
The funds are separate series of their respective Trusts. For example, each
Equity fund is a series of either NB Equity Funds, NB Equity Trust, NB Equity
Assets or NB Equity Series. Each Equity fund (except for Neuberger Berman
International Fund and International Trust) invests all of its net investable
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<PAGE>
assets in a corresponding master fund, which is a series of Equity Managers
Trust, a New York common law trust registered as an open-end management
investment company. Neuberger Berman International Fund and International Trust
invest in a corresponding master fund, a series of Global Managers Trust, a New
York common law trust registered as an open-end management investment company.
Similarly, each Income Fund is a series of either NB Income Funds or NB
Income Trust. Each Income fund invests all of its net investable assets in a
corresponding master fund, which is a series of Income Managers Trust, a New
York common law trust registered as an open-end management investment company.
NBMI serves as the investment manager and Neuberger Berman, LLC ("Neuberger
Berman") serves as sub-adviser to each series of Equity Managers Trust, Global
Managers Trust and Income Managers Trust. Each Managers Trust series invests in
securities in accordance with an investment objective, policies, and limitations
identical to those of its corresponding funds.
As of May 31, 2000, the following numbers of shares were outstanding with
respect to each fund:
<TABLE>
NEUBERGER BERMAN EQUITY GROUP OF FUNDS
<CAPTION>
-------------------------------------------------------------------------------------------------
SERIES NB EQUITY FUNDS NB EQUITY TRUST NB EQUITY ASSETS NB EQUITY SERIES
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Century 3,078,480 162,298 N/A N/A
-------------------------------------------------------------------------------------------------
Focus 38,666,424 8,898,394 339,934 N/A
-------------------------------------------------------------------------------------------------
Genesis 41,626,081 27,946,499 6,215,023 9,139,474
-------------------------------------------------------------------------------------------------
Guardian 140,791,769 72,377,898 1,789,995 N/A
-------------------------------------------------------------------------------------------------
International 9,280,619 211,885 N/A N/A
-------------------------------------------------------------------------------------------------
Manhattan 53,475,158 5,058,044 201,709 N/A
-------------------------------------------------------------------------------------------------
Millennium 8,703,527 509,827 16,783 N/A
-------------------------------------------------------------------------------------------------
Partners 91,997,828 35,278,693 3,384,097 N/A
-------------------------------------------------------------------------------------------------
Regency 819,438 1,900,095 N/A N/A
-------------------------------------------------------------------------------------------------
Socially 5,176,666 1,967,394 22,359 N/A
Responsive
-------------------------------------------------------------------------------------------------
Technology 1,246,774 200,033 N/A N/A
-------------------------------------------------------------------------------------------------
</TABLE>
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<PAGE>
NEUBERGER BERMAN INCOME GROUP OF FUNDS
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------
SERIES NB INCOME FUNDS NB INCOME TRUST
---------------------------------------------------------------------------------------
<S> <C> <C>
Cash Reserves 1,211,106,231 N/A
---------------------------------------------------------------------------------------
Government Money 379,346,979 N/A
---------------------------------------------------------------------------------------
High Yield Bond 1,844,121 N/A
---------------------------------------------------------------------------------------
Institutional Cash N/A 74,600,995
---------------------------------------------------------------------------------------
Limited Maturity Bond 20,161,604 3,804,748
---------------------------------------------------------------------------------------
Municipal Money 299,551,941 N/A
---------------------------------------------------------------------------------------
Municipal Securities Trust 2,770,095 N/A
---------------------------------------------------------------------------------------
</TABLE>
In addition, to the Trust's knowledge, as of May 31, 2000, the following are all
of the beneficial and record owners of more than five percent of each fund.
Except where indicated with an asterisk, the owners listed are record owners.
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
NB Century Trust Neuberger & Berman 92.42%
55 Water Street, 27th Floor
Attn: Ron Staib, OPS Control
New York, NY 10041-0001
A/C # 983031311/7
------------------------------------------------------------------------------------------------
National Financial Services Corp 6.33%
For the Exclusive Benefit of Our
Customers
PO Box 3908
Church Street Station
New York, NY 10008-3908
A/C # 140117994-0
------------------------------------------------------------------------------------------------
NB Focus Trust Smith Barney Inc. 22.44%
00109801250
388 Greenwich Street
New York, NY 10012-2339
A/C # 140360494/7
------------------------------------------------------------------------------------------------
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<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
EMJAYCO 11.47%
Omnibus Account
PO Box 170910
Milwaukee, WI 53217
A/C # 140296928
------------------------------------------------------------------------------------------------
American Express Trust Co. 11.81%
Benefit of American Express
Trust Retirement Services Plans
Attn: Pat Brown
50534 AXP Financial Center
Minneapolis, MN 55474
A/C # 140216267-1
------------------------------------------------------------------------------------------------
National Financial Services Corp 6.87%
For the Exclusive Benefit of Our
Customers
PO Box 3908
Church Street Station
New York, NY 10008-3908
A/C # 140117994-0
------------------------------------------------------------------------------------------------
Boston Safe Deposit & Trust Co. TTEE 8.81%
TWA Inc Pilots Directed Acct. Plan &
401K Plan for Pilots of TWA Inc.
Attn: Lisa Bove
135 Santilli Highway #26-0320
Everett, MA 02149-1906
A/C # 140221394-4
------------------------------------------------------------------------------------------------
AETNA Life Insurance & Annuity Co. 7.57%
ACES-Separate Account F
Attn: Valuation Unit TS31
151 Farmington Avenue
Hartford, CT 06156-0001
A/C # 140188621-7
------------------------------------------------------------------------------------------------
NB Genesis Trust Fidelity Investments Inst. OPS Co. as 19.64%
Agent for Certain EE Benefit PL
100 Magellan Way
Mailzone KWIC
Covington, KY 41015
A/C # 140216026-2
------------------------------------------------------------------------------------------------
Smith Barney
00109801250
388 Greenwich Street
New York, NY 10012-2339
------------------------------------------------------------------------------------------------
- 13 -
<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
National Financial Services Corp 14.53%
For the Exclusive Benefit of Our
Customers
PO Box 3908
Church Street Station
New York, NY 10008-3908
A/C # 14011799-0
------------------------------------------------------------------------------------------------
Nationwide Life Insurance Co. 6.55%
QPVA
c/o IPO Portfolio Accounting
PO Box 182029
Columbus, OH 43218-2029
------------------------------------------------------------------------------------------------
NB Guardian Trust The Manufacturers Life Insurance Co. 26.21%
USA
Attn: Rosie Chuck Pension Acctg.
200 Floor Street E NT3
Toronto ON N4W1E5
Canada
A/C # 140317724-1
------------------------------------------------------------------------------------------------
Fidelity Investments Inst. OPS Co. as 14.51%
Agent for Certain EE Benefit PL
100 Magellan Way
Mailzone KWIC Covington, KY 41015
A/C # 140216026-2
------------------------------------------------------------------------------------------------
Nationwide Life Insurance Co. 9.25%
QPVA
c/o IPO Portfolio Accounting
PO Box 182029
Columbus, OH 43218-2029
A/C # 140216217-6
------------------------------------------------------------------------------------------------
Variable Annuity Life Insurance 5.50%
Company (VALIC)
2929 Allen Parkway L7-01
Houston, TX 77019-2197
A/C # 140317787-2
------------------------------------------------------------------------------------------------
Connecticut General Life Insurance 5.38%
Company
350 Church Street
PO Box 2975 M-1-10
Hartford, CT 06104-2975
A/C # 140317726-7
------------------------------------------------------------------------------------------------
- 14 -
<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
National Financial Services Corp 4.94%
For the Exclusive Benefit of Our
Customers
PO Box 3908
Church Street Station
New York, NY 10008-3908
A/C # 140117994-0
------------------------------------------------------------------------------------------------
NB International Trust Chase Manhattan Bank TTEE 23.31%
Various Retirement Plans
Under PPI Retirement Programs
Professional Pensions Inc.
444 Foxon Road
East Haven, CT 06513-2019
A/C # 140215987-5
------------------------------------------------------------------------------------------------
Fleet Trust Corporation 19.08%
FBO Third Party M P Alliances
Attn: David Nabb
PO Box 2197
Boston, MA 02106-2197
A/C # 140224012-4
------------------------------------------------------------------------------------------------
National Financial Services Corp 17.71%
For the Exclusive Benefit of Our
Customers
200 Liberty Street
1 World Financial Center
Attn: Mutual Funds Dept - 5th Floor
New York, NY 10281-1003
A/C # 140117994-0
------------------------------------------------------------------------------------------------
Neuberger Berman Trust 9.87%
T/F Lillian Vernon Corp*
401K Profit Sharing Plan
1 Theall RDL
Rye, NY 10580-1404
A/C # 140318915-8
------------------------------------------------------------------------------------------------
Smith Barney Inc 22.97%
00109801250
388 Greenwich Street
New York, NY 10012-2339
A/C # 140360494-7
------------------------------------------------------------------------------------------------
NB Manhattan Trust The Northern Trust Co TTEE 49.03%
Pro Case Corporation 22-75833
Attn: Ken King
Chicago, IL 60675-2956
A/C # 140214077-4
------------------------------------------------------------------------------------------------
- 15 -
<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
MAC & Co A/C 195-643 13.91%
AEOF1956432
P.O. Box 3198
Mutual Funds Operations
Pittsburgh, PA 15230-3198
A/C # 140162422-0
------------------------------------------------------------------------------------------------
Fleet National Bank 9.49%
Aetna/Fleet Directed Trustee
U/A Dtd 4/22/96
151 Farmington Avenue, Suite T531
Hartford, CT 06156-0001
A/C # 140319049-3
------------------------------------------------------------------------------------------------
Fidelity Investments Inst Ops 6.18%
CO as Agency for Certain EE Benefit
PL
Mailzone KWIC
Covington, KY 41015
A/C # 140216026-2
------------------------------------------------------------------------------------------------
NB Millennium Trust National Financial Serv Corp 86.68%
For the Exclusive Benefit of Our
Customers
P.O. Box 3908
Church Street Station
New York, NY 10008-3908
A/C # 140117994-0
------------------------------------------------------------------------------------------------
Donaldson, Lufkin & Jenrette Securities 6.88%
Corporation
Pershing Division
Mutual Fund Balancing
P.O. Box 2052
Jersey City, NY 07303-2052
A/C # 140219348-8
------------------------------------------------------------------------------------------------
NB Partners Trust Nationwide Life Insurance 20.06%
QPVA
c/o IPO Portfolio Accounting
P.O. Box 182029
Columbus, OH 43218-2029
A/C # 140216217-6
------------------------------------------------------------------------------------------------
Connecticut General Life Insurance 11.27%
Company
350 Church Street
P.O. Box 2975 N-110
Hartford, CT 06104-2975
A/C # 140317726-7
------------------------------------------------------------------------------------------------
- 16 -
<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
PRC Inc 10.43%
c/o T. Rowe Price Financial
Attn: Asset Room
P.O. Box 17215
Baltimore, MD 21297-1215
A/C # 140215856-2
------------------------------------------------------------------------------------------------
National Financial Serv Corp for the 8.17%
Exclusive Benefit of Our Customers
P.O. Box 3908
Church Street Station
New York, NY 10008-3908
A/C # 140117994-0
------------------------------------------------------------------------------------------------
Fidelity Investments Instit Oper Co as 7.58%
Agent for Certain Benefit Pln
100 Magellan Way
Mailzone KWIC Covington, KY 41015-1999
A/C # 140216026-2
------------------------------------------------------------------------------------------------
Northern Trust Co TTEE 6.12%
FBO: Phycor Savings Plan DV
P.O. Box 92956
Chicago, IL 60675-2956
A/C # 1403777065-5
------------------------------------------------------------------------------------------------
NB Regency Trust Boston Safe Deposit & Trust Co TTEE 97.77%
TWA Inc Pilots Directed Acct Plan
& 401K Plan for Pilots of TWA Inc
Attn: Lisa Bove
135 Santilli Hwy #026-0320
Everett, MA 02149-1906
A/C # 140221394-4
------------------------------------------------------------------------------------------------
NB Socially Responsive Trust ICMA Retirement Trust 60.32%
777 N Capitol Street NE
Washington, DC 20002-4239
A/C # 140317410-5
------------------------------------------------------------------------------------------------
Delaware Charter Guarantee & Trust 6.74%
Cust FBO Principal Mutual Life Ins
CD DTD 1/1/96
PO Box 8706
Wilmington, DE 19899-8706
A/C # 140317436-7
------------------------------------------------------------------------------------------------
- 17 -
<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
Chase Manhattan Bank TTEE 6.88%
Avon Products Inc
Svngs & Stock Ownership 12/28/84
1345 Avenue of the Americas
New York, NY 10105-0302
A/C # 141016331-6
------------------------------------------------------------------------------------------------
National Financial Serv Corp 5.22%
For The Exclusive Benefit of Our
Customers
PO Box 3908
Church Street Station
New York, NY 10008-3908
A/C # 140117994-0
------------------------------------------------------------------------------------------------
The Union Central Life Ins Co 5.15%
401K Group SEP Acct
1876 Waycross RD
PO Box 40888
Cincinnati, OH 45240-0888
A/C # 141011568-1
------------------------------------------------------------------------------------------------
NB Technology Trust Neuberger & Berman 99%
55 Water Street, 27th Floor
Attn: Ron Staib, OPS Control
New York, NY 10041-0001
A/C# 983000019
------------------------------------------------------------------------------------------------
NB Focus Assets FTC & CO 21.71%
Attn: Datalynx (House Account)
PO Box 173736
Denver, CO 80217-3736
A/C # 141011560-7
------------------------------------------------------------------------------------------------
Smith Barney Corp Trust Co TTEE 20.27%
Smith Barney 401K
Advisor Group Trust
Two Tower Center
PO Box 1063
E Brunswick, NJ 08816-1063
A/C # 142010744-3
------------------------------------------------------------------------------------------------
First Union Nat'l Bank TTEE 19.81%
FBO FUNB Reinvestment Account
A/C # 1080824434
1525 W Wt Harris Blvd NC-1151
Charlotte, NC 28262-1063
A/C # 994000003-5
------------------------------------------------------------------------------------------------
- 18 -
<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
Morris & Co 17.53%
c/o First Source Bank
Attn: Trust Operations
PO Box 1602
South Bend, IN 46634-1602
A/C # 140318696-0
------------------------------------------------------------------------------------------------
Key Trust Co NA 11.65%
FBO Prism
4900 Tiedeman RD
Brooklyn, OH 44144-2338
A/C # 140317435-4
------------------------------------------------------------------------------------------------
Donaldson, Lufkin & Jenrette 6.02%
Securities Corporation
Pershing Division
Mutual Fund Balancing
PO Box 2052
Jersey City, NJ 07303-2052
A/C # 142011195-0
------------------------------------------------------------------------------------------------
NB Genesis Assets Donaldson, Lufkin & Jenrette 40.06%
Securities Corporation
Pershing Division
Mutual Fund Balancing
PO Box 2052
Jersey City, NJ 07303-2052
A/C # 142011195-0
------------------------------------------------------------------------------------------------
Key Trust Co. 29.22%
FBO Prism
4900 Tiedeman RD
Brooklyn, OH 44144-2302
A/C # 140317435-4
------------------------------------------------------------------------------------------------
NB Guardian Assets Travelers Insurance Company #4 97.07%
Attn: Bob Iagrossi 5MS
Shareholder Accounting
One Tower Square
Hartford, CT 06183-0002
A/C # 140296923-0
------------------------------------------------------------------------------------------------
NB Manhattan Assets BHC Securities 76.94%
Trade House Account
Attn: Mutual Fund Dept.
1 Commerce Square
2005 Market Street
Philadelphia, PA 19103-7042
A/C # 142011785-7
------------------------------------------------------------------------------------------------
- 19 -
<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
BSC as Agent for 7.02%
FBO BBH-SD
1375 Peachtree Street NE STE 300
Atlanta, GA 30309-3112
A/C # 141016563-1
------------------------------------------------------------------------------------------------
Neuberger Berman 5.71%
Management Inc.*
605 Third Avenue 2nd Floor
New York, NY 10158-0180
A/C # 140289664-0
------------------------------------------------------------------------------------------------
Donaldson, Lufkin & Jenrette 5.90%
Securities Corporation
Pershing Division
Mutual Fund Balancing
PO Box 2052
Jersey City, NJ 07303-2052
A/C # 142011195-0
------------------------------------------------------------------------------------------------
NB Millennium Assets Charles Schwab & Co. Inc. 91.11%
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
A/C # 142011784-4
------------------------------------------------------------------------------------------------
NB Socially Neuberger Berman 44.72%
Responsive Assets Management Inc.*
Attn: Nick Altomare
605 Third Avenue 37th Floor
New York, NY 10158-0180
A/C # 105785000-8
------------------------------------------------------------------------------------------------
First Union Nat'l Bank Cust 13.91%
Various Retirement Plan
A/C # 1080826922
1525 W Wt Harris Blvd NC-1151
Charlotte, NC 28262-8522
A/C # 100000000-9
------------------------------------------------------------------------------------------------
Fidelity Investments Institutional 14.54%
Operations Co Inc. (FIIOC) As Agent
For Peet's Tea Coffee Inc. Savings
Retirement Plan #09771
100 Magellan Way
Covington, KY 41015-1999
A/C # 141017216-1
------------------------------------------------------------------------------------------------
- 20 -
<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
Charles Schwab & Co. Inc. 8.77%
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
A/C # 142011784-4
------------------------------------------------------------------------------------------------
Fidelity Investments Institutional 8.57%
Operations Co Inc. (FIIOC) As Agent
For Inforonics Retirement 401K Plan 09897
100 Magellan Way (KWIC)
Covington, KY 41015-1999
A/C # 141016349-7
------------------------------------------------------------------------------------------------
Fidelity Investments Institutional 8.02%
Operations Co Inc. (FIIOC) As Agent
For Citizens Enterprises Corp.
401K Plan
100 Magellan Way (KWIC)
Covington, KY 41015-1999
A/C # 140379131-3
------------------------------------------------------------------------------------------------
NB Century Fund Neuberger & Berman 17.52%
55 Water Street 27th Floor
Attn: Ron Staib, OPS Control
New York, NY 10041-0001
A/C # 983031311-7
------------------------------------------------------------------------------------------------
NB Focus Fund Charles Schwab & Co. Inc. 9.64%
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
A/C # 140187165-9
------------------------------------------------------------------------------------------------
NB Genesis Fund Charles Schwab & Co. Inc. 25.56%
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
A/C # 140187165-9
------------------------------------------------------------------------------------------------
Union Central Life 5.50%
Insurance Co
Attn: Mutual Funds Dept Station 3
PO Box 40888
Cincinnati, OH 45210-0888
A/C # 140041406-2
------------------------------------------------------------------------------------------------
- 21 -
<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
NB Guardian Fund Charles Schwab & Co. Inc. 19.77%
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
A/C # 140187165-9
------------------------------------------------------------------------------------------------
NB International Fund Neuberger & Berman 11.77%
55 Water Street 27th Floor
Attn: Ron Staib, OPS Control
New York, NY 10041-0001
A/C # 140221735-1
------------------------------------------------------------------------------------------------
Charles Schwab & Co. Inc. 9.31%
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
A/C # 140187165-9
------------------------------------------------------------------------------------------------
Neuberger & Berman Trust Co.* 5.88%
Neuberger & Berman Employees
Profit Sharing Plan UTD 5/20/71
Attn: Al Boccardo
605 Third Avenue, 36th Floor
New York, NY 10158-0180
A/C # 140247272-7
------------------------------------------------------------------------------------------------
NB Manhattan Fund Charles Schwab & Co Inc. 6.13%
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
A/C # 140187165-9
------------------------------------------------------------------------------------------------
NB Regency Fund Neuberger & Berman 26.75%
Attn: Ron Staib, OPS Control
55 Water Street, Floor 27
New York, NY 10041-0001
A/C # 983031113-5
------------------------------------------------------------------------------------------------
Charles Schwab & Co. Inc. 26.52%
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
A/C # 140187165-9
------------------------------------------------------------------------------------------------
NB Partners Fund Charles Schwab & Co. Inc. 14.00%
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
A/C # 140187165-9
------------------------------------------------------------------------------------------------
- 22 -
<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
NB Socially Responsive Fund Charles Schwab & Co. Inc. 23.21%
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
A/C # 140187165-7
------------------------------------------------------------------------------------------------
NB Technology Fund Neuberger Berman, LLC* 7%
001-17000-10
55 Water Street. 27th Floor
New York, NY 10041-0001
A/C# 325000008
------------------------------------------------------------------------------------------------
Neuberger Berman, LLC* 7%
020-02900-13
55 Water Street. 27th Floor
New York, NY 10041-0001
A/C# 325000034
------------------------------------------------------------------------------------------------
Neuberger Berman, LLC* 6%
020-12002-19
55 Water Street. 27th Floor
New York, NY 10041-0001
A/C# 325000019
------------------------------------------------------------------------------------------------
NB Genesis Institutional Wilmington Trust Co. 59.71%
FBO PricewaterhouseCoopers LLP
Emp Partners Psugs A/C 500854
c/o Mutual Funds
P.O. Box 8971
Wilmington, DE 19899-8971
A/C#140379014
------------------------------------------------------------------------------------------------
Wilmington Trust Co. 29.95%
FBO PricewaterhouseCoopers LLP
Emp Partners P/S A/C 500824 U/A 03-01-00 c/o
Mutual Funds P.O. Box 8971 Wilmington, DE
19899-8971 A/C#140379010
------------------------------------------------------------------------------------------------
Wilmington Trust Co. 10.33%
FBO PricewaterhouseCoopers LLP
Emp Ret Ben Accum A/C 5007974
U/A 03-01-00 c/o
Mutual Funds
P.O. Box 8971
Wilmington, DE 19899-8971
A/C#140379012
------------------------------------------------------------------------------------------------
- 23 -
<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
Gary N. Skoloff* 11.49%
Saul A. Wolfe
Skoloff & Wolfe Target
Benefit Trust DTD 11-1-95
293 Eisenhower Parkway
Livingston, NJ 07039-1711
A/C # 140216230-9
------------------------------------------------------------------------------------------------
Chase Manhattan Bank TTEE 7.96%
Various Retirement Plans Under PPI
Retirement Programs
Professional Pensions, Inc.
444 Foxon Road
East Haven, CT 06513-2019
A/C # 140215987-5
------------------------------------------------------------------------------------------------
National Financial Service Corp. for the 6.92%
Exclusive Benefit of Our Customers
P.O. Box 3908
Church Street Station
New York, NY 10008-3908
A/C # 140117994-0
------------------------------------------------------------------------------------------------
NB Cash Reserves Neuberger & Berman 78.74%
55 Water Street, 27th Floor
Attn: Ron Staib, OPS Control
New York, NY 10041-0001
A/C # 982009417-4
------------------------------------------------------------------------------------------------
NB Government Neuberger & Berman 81.70%
Money Fund 55 Water Street, 27th Floor
Attn: Ron Staib, OPS Control
New York, NY 10041-0001
A/C # 982009417-4
------------------------------------------------------------------------------------------------
NB High Yield Fund Neuberger & Berman 30.20%
55 Water Street, 27th Floor
Attn: Ron Staib, OPS Control
New York, NY 10041-0001
A/C # 98302231-2
------------------------------------------------------------------------------------------------
NB Limited Maturity Neuberger & Berman Trust Co. 6.45%
Bond Fund Neuberger & Berman Employees
Profit Sharing Plan UTD 5/20/71*
Attn: Al Boccardo
605 Third Avenue, 36th Floor
New York, NY 10158-0180
A/C # 140247272-7
------------------------------------------------------------------------------------------------
- 24 -
<PAGE>
------------------------------------------------------------------------------------------------
FUND NAME AND ADDRESS OWNER PERCENT OF THE
FUND OWNED
------------------------------------------------------------------------------------------------
<S> <C> <C>
Neuberger & Berman LLC 5.08%
Bodman Foundation
John N. Irwin III Pres & Treas
C/O Institutional Equity Dept
605 Third Ave 22 Floor
New York, NY 10158-2299
A/C # 143030908-2
------------------------------------------------------------------------------------------------
NB Limited Maturity Charles Schwab & Co. Inc. 23.58%
Bond Fund Attn: Mutual Funds
125 Broad Street, FL 15
New York, NY 10004-2400
A/C # 140187165-9
------------------------------------------------------------------------------------------------
QPVA
c/o IPO Portfolio Accounting
PO Box 182029
Columbus, OH 43218-2029
A/C # 136753000-5
------------------------------------------------------------------------------------------------
Neuberger & Berman Trust Co.* 5.61%
Neuberger & Berman Employees
Profit Sharing Plan UTD 05/20/71
Attn: Al Boccardo
605 Third Ave, 36th Floor
New York, NY 10158-0180
A/C # 140247272-7
------------------------------------------------------------------------------------------------
NB Municipal Charles Schwab & Co. Inc. 25.18%
Securities Trust Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
A/C # 140187165-9
------------------------------------------------------------------------------------------------
</TABLE>
At May 31, 2000, the Trustees and officers of the Trusts as a group
beneficially owned less than 1% of the shares of each fund. Certain Trustees and
officers of the Trusts are employees and shareholders of NBMI, which will
benefit if the Proposal 5, related to the Distribution and Shareholder Services
Plan, is approved.
COPIES OF THE FUNDS' MOST RECENT ANNUAL AND SEMI-ANNUAL REPORTS, INCLUDING
FINANCIAL STATEMENTS, HAVE PREVIOUSLY BEEN DELIVERED TO SHAREHOLDERS.
SHAREHOLDERS OF THE NEUBERGER BERMAN EQUITY GROUP OF FUNDS (NEUBERGER BERMAN
EQUITY FUNDS, EQUITY TRUST, EQUITY ASSETS OR EQUITY SERIES) MAY REQUEST COPIES
OF THE FUNDS' ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 1999, INCLUDING
AUDITED FINANCIAL STATEMENTS, AND THE FUNDS' SEMI-ANNUAL REPORT FOR THE PERIOD
ENDED FEBRUARY 29, 2000, AT NO CHARGE BY WRITING NBMI AT 605 THIRD AVENUE, 2ND
FLOOR, NEW YORK, NEW YORK 10158-0180, OR BY CALLING TOLL FREE 800-877-9700.
- 25 -
<PAGE>
SHAREHOLDERS OF THE NEUBERGER BERMAN INCOME GROUP OF FUNDS (NEUBERGER
BERMAN INCOME FUNDS OR INCOME TRUST) MAY REQUEST COPIES OF THE FUNDS' ANNUAL
REPORT FOR THE FISCAL YEAR ENDED OCTOBER 31, 1999, INCLUDING AUDITED FINANCIAL
STATEMENTS, AND THE FUNDS' SEMI-ANNUAL REPORT FOR THE PERIOD ENDED APRIL 30,
2000, AT NO CHARGE BY WRITING NBMI AT 605 THIRD AVENUE, 2ND FLOOR, NEW YORK, NEW
YORK 10158-0180, OR BY CALLING TOLL FREE 800-877-9700.
GENERAL OVERVIEW OF THE PROPOSALS
The following is a brief overview regarding the matters being presented for
your approval at the Meeting:
PROPOSAL 1 (SHAREHOLDERS OF ALL FUNDS): To elect a Board of Trustees. The
Neuberger Berman funds are composed of three fund groups - the equity funds, the
income funds, and the insurance funds. Currently, each fund group has its own
Board of Trustees, with very limited overlap in membership. The Boards,
including all of the independent Trustees, and management believe that
considerable efficiencies can be realized by having the same individuals serve
on each of the Boards.
PROPOSAL 2 (SHAREHOLDERS OF ALL FUNDS): To change the fundamental
limitation requiring diversification of investments among different issuers so
as to allow the funds to invest to a greater extent in securities issued by
other investment companies. This change is intended primarily to allow the funds
to take full advantage of investments allowed under the law while remaining
diversified funds. The change will allow the funds to invest excess cash in a
money market fund managed by NBMI. The Board believes that such combined
management would result in greater efficiency, which could produce greater
return to investors.
PROPOSAL 3 (SHAREHOLDERS OF ALL FUNDS): To ratify the selection of the
funds' independent auditors or accountants.
PROPOSAL 4 (SHAREHOLDERS OF EQUITY TRUSTS, EQUITY ASSETS, EQUITY SERIES AND
INCOME TRUSTS): To convert each fund from the current two-level master-feeder
structure to a single-level multi-class structure. The investment programs of
the funds and the rights of shareholders would be unaffected by this change,
except in certain minor respects explained below.
PROPOSAL 5 (SHAREHOLDERS OF GENESIS TRUST, GUARDIAN TRUST, AND PARTNERS
TRUST): To approve a distribution and shareholder services plan whereby each of
those funds would be authorized to spend up to 0.10% (one-tenth of one percent)
of its average net assets each year to obtain distribution and/or shareholder
services. Currently, all expenses of share distribution are paid by NBMI. If the
Proposal is approved, the Distribution and Shareholder Services Plan would
increase the annual expenses indirectly borne by the shareholders of each Fund
by 0.10% of average daily net assets.
PROPOSAL 6 (SHAREHOLDERS OF CASH RESERVES ONLY): To change Cash Reserves'
fundamental restriction on industry concentration to permit concentration in the
financial services group of industries.
- 26 -
<PAGE>
PROPOSAL 7 (SHAREHOLDERS OF GOVERNMENT MONEY FUND ONLY): To change
Government Money Fund's fundamental policies to:
o permit the fund to invest in all securities issued or guaranteed as to
principal or interest by the U.S. Government, its agencies or
instrumentalities;
o permit the fund to invest in repurchase agreements in an effort to earn
more income;
o modify the fund's borrowing policy to permit the fund to use reverse
repurchase agreements;
o modify the fund's lending policy to permit the fund to lend portfolio
securities.
PROPOSAL 8 (SHAREHOLDERS OF ALL FUNDS): To vote on such other matters as
may properly come before the Meeting. The funds are not currently aware of any
such matters.
- 27 -
<PAGE>
PROPOSAL 1. ELECTION OF TRUSTEES (ALL FUNDS)
The Boards of Trustees of the funds propose that shareholders elect the
individuals named in the table below as members of one Board of Trustees that
would serve all of the funds. With this proposal, the separate Boards of the
three different fund groups that make up the Neuberger Berman family of mutual
funds - the equity funds group, the income funds group, and the insurance funds
group - intend to consolidate, so the same individuals would serve on the Boards
of all three groups of funds.
Currently, each of these different groups has its own Board of Trustees
(several trustees serve on the boards of more than one group). For seven years,
the multiple boards have had separate meetings, but often have reviewed the same
or substantially the same policy issues, contractual arrangements and other
matters for their respective fund groups. The trustees of each of these Boards
have agreed that both the funds and NBMI would enjoy substantial efficiencies if
the same individuals served as Trustees of all of the funds in the Neuberger
Berman fund family.
This consolidation was initially proposed by NBMI at a time when several of
the Boards were contemplating shareholder meetings to fill Board vacancies
created by retirements. The proposal was taken up by the independent trustees of
each fund group (i.e., those who do not fall within the definition of
"interested person" in the Investment Company Act of 1940, as amended ("1940
Act") ("Independent Trustees")) and discussed at several meetings over a period
of months. The Boards explored the potential benefits and drawbacks of the
proposal, as well as various alternatives. They noted that consolidating the
three boards would reduce the duplication of board materials and reports, which
are comprehensive and often lengthy, and would avoid the need for repeated
presentations by the same personnel at the different meetings.
The Independent Trustees also considered that all Boards in the Neuberger
Berman fund family were actively seeking additional members, or soon would be,
and that consolidation of the Boards would produce a pool of candidates already
familiar with (1) the Neuberger Berman fund family, its manager, underwriter,
administrator, and methods of operation, (2) the mutual fund business and the
comprehensive regulatory regime under which it operates, as well as (3) the
special responsibilities that the law assigns to mutual fund trustees.
Therefore, each fund will be able to preserve the continuity of its current
Board's leadership while benefiting from the added knowledge and experience of
the other Neuberger Berman fund trustees. They considered the potential cost
savings, the ability of the Boards to act faster and in a more coordinated
fashion, and whether the benefits to NBMI would benefit the shareholders. They
also considered the potential size of the combined Board, noting that it would
be larger than the boards of most other mutual funds. They considered the effect
that consolidation might have on the Board's working style and the working
relationships among the members of each board, and the potential effect of
attrition over the next several years.
The matter was then taken up by the Nominating Committee of each Board,
which is also composed entirely of Independent Trustees. The Nominating
Committee considered the qualifications and backgrounds of the candidates, and
the expressed desire of certain members of the various Boards to retire.
- 28 -
<PAGE>
Unless you give instructions on the enclosed proxy card to withhold your
vote for any candidate, your shares will be voted "FOR" the election of each of
the listed nominees. If any or all of the nominees should withdraw or otherwise
become unavailable for election, your shares will be voted "FOR" such other
nominee or nominees as the Nominating Committee may recommend. Each nominee has
indicated his or her willingness to serve if elected. If elected, each nominee
will hold office until his or her successor is elected and qualified, or until
he or she sooner retires, resigns, dies, or is removed from office as provided
in each fund's Trust Instrument.
If each of the nominees is elected, they will constitute the entire Board
of Trustees of each Trust. At May 31, 2000, the trustees and officers of each
fund, as a group, owned beneficially or of record less than 1% of the
outstanding shares of each series of each fund.
The following table lists the candidates. Unless otherwise indicated, each
candidate has engaged in the principal occupation listed for at least the last
five years, although not necessarily in the same capacity. As indicated, each of
the nominees (except Mr. Seip) currently serves as a Trustee of one or more
funds; of the candidates, all except Ms. Harvey, Mr. Cannon, Mr. Kassen, Mr.
Seip and Mr. Sundman were elected by shareholders in 1993 or 1994.
Present Position with the Neuberger Berman
Name, Age, and Address (1) Funds; Business Experience During Past Five
---------------------------- Years; Other Trusteeships (2)
-------------------------------------------
John Cannon (70) TRUSTEE OF INCOME FUNDS, INCOME TRUST, AND
CDC Capital Management INCOME MANAGERS TRUST (SINCE 1994). Chairman
450 Sentry Parkway, Suite 105 and Chief Investment Officer of CDC Capital
P.O. Box 1212 Management (registered investment adviser)
Blue Bell, PA 19422 (1993-present).
Faith Colish (64) TRUSTEE OF EQUITY FUNDS, EQUITY TRUST,
63 Wall Street EQUITY ASSETS, AND EQUITY MANAGERS TRUST
24th Floor (SINCE 1993); EQUITY SERIES (SINCE 1998); AND
New York, NY 10005 NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST
(SINCE 1984).
Attorney at Law, Faith Colish, A Professional
Corporation.
TRUSTEE OF NEUBERGER BERMAN ADVISERS MANAGEMENT
Walter G. Ehlers (67) TRUST (SINCE 1989). Consultant, Director of
6806 Suffolk Place the Turner Corporation, A.B. Chance Company and
Harvey Cedars, NJ 08008 Crescent Jewelry, Inc.
- 29 -
<PAGE>
Present Position with the Neuberger Berman
Name, Age, and Address (1) Funds; Business Experience During Past Five
---------------------------- Years; Other Trusteeships (2)
-------------------------------------------
C. Anne Harvey (62) TRUSTEE OF NEUBERGER BERMAN ADVISERS MANAGEMENT
2555 Pennsylvania Avenue, N.W. TRUST (SINCE 1998). Director of American
Washington, D.C. 20037 Association of Retired Persons ("AARP") Program
Services and Administrator of AARP Foundation;
The National Rehabilitation Hospital's Board of
Advisors; Individual Investors Advisory
Committee to the New York Stock Exchange Board
of Directors; Steering Committee for the U.S.
Securities and Exchange Commission Facts on
Saving and Investing Campaign; and American
Savings Education Council's Policy Board
(ASEC).
Barry Hirsch (67) TRUSTEE OF INCOME FUNDS, INCOME TRUST AND
Loews Corporation INCOME MANAGERS TRUST (SINCE 1993). Senior
667 Madison Avenue Vice President, Secretary, and General Counsel
7th Floor of Loews Corporation (diversified financial
New York, NY 10021 corporation).
Michael M. Kassen* (47) PRESIDENT AND TRUSTEE OF EQUITY FUNDS, EQUITY
TRUST, EQUITY ASSETS, EQUITY SERIES AND EQUITY
MANAGERS TRUST; PRESIDENT OF GLOBAL MANAGERS
TRUST (SINCE 1999). Executive Vice President,
Chief Investment Officer of Neuberger Berman
LLC; Chairman and Director of NBMI; Executive
Vice President, Chief Investment Officer and
Director of Neuberger Berman Inc.
Robert A. Kavesh (72) TRUSTEE OF INCOME FUNDS, INCOME TRUST AND
110 Bleecker Street INCOME MANAGERS TRUST (SINCE 1993). Professor
Apt. 24B of Finance and Economics at Stern School of
New York, NY 10012 Business, New York University.
Howard A. Mileaf (63) TRUSTEE OF EQUITY FUNDS, EQUITY TRUST, EQUITY
WHX Corporation ASSETS, AND EQUITY MANAGERS TRUST (SINCE 1993);
110 East 59th Street EQUITY SERIES (SINCE 1998); GLOBAL MANAGERS
30th Floor TRUST (SINCE 1994); AND NEUBERGER BERMAN
New York, NY 10022 ADVISERS MANAGEMENT TRUST (SINCE 1999). Vice
President and Special Counsel to WHX
Corporation (holding company) since 1992;
Director of Kevlin Corporation (manufacturer of
microwave and other products).
- 30 -
<PAGE>
Present Position with the Neuberger Berman
Name, Age, and Address (1) Funds; Business Experience During Past Five
---------------------------- Years; Other Trusteeships (2)
-------------------------------------------
Edward I. O'Brien* (71) TRUSTEE OF EQUITY FUNDS, EQUITY TRUST, EQUITY
12 Woods Lane ASSETS, AND EQUITY MANAGERS TRUST (SINCE 1993);
Scarsdale, NY 10183 AND EQUITY SERIES (SINCE 1998). Private
Investment Management; President of the
Securities Industry Association ("SIA")
(securities industry's representative in
government relations and regulatory matters at
the federal and state levels) from 1974 to
1992; Adviser to SIA from November 1992 to
November 1993; Director of Legg Mason, Inc.
John T. Patterson, Jr. (72) TRUSTEE OF EQUITY FUNDS, EQUITY TRUST, EQUITY
7082 Siena Court ASSETS AND, EQUITY MANAGERS TRUST (SINCE 1993);
Boca Raton, FL 33433 GLOBAL MANGERS TRUST (SINCE 1994); AND EQUITY
SERIES (SINCE 1998). Retired. Formerly,
President of SOBRO (South Bronx Overall
Economic Development Corporation).
John P. Rosenthal (67) TRUSTEE OF EQUITY FUNDS, EQUITY TRUST, EQUITY
Burnham Securities Inc. ASSETS AND EQUITY MANGERS TRUST (SINCE 1993);
Burnham Asset Management Corp. AND GLOBAL MANAGERS TRUST (SINCE 1994). Senior
1325 Avenue of the Americas Vice President of Burnham Securities Inc. (a
26th Floor registered broker-dealer) since 1991.
New York, NY 10019
William E. Rulon (67) TRUSTEE OF INCOME FUNDS, INCOME TRUST AND
2980 Bayside Walk INCOME MANAGERS TRUST (SINCE 1993). Retired.
San Diego, CA 92109 Senior Vice President of Foodmaker, Inc.
(operator and franchiser of restaurants) until
January 1997; Secretary of Foodmaker, Inc.
until July 1996.
Cornelius T. Ryan (68) TRUSTEE OF EQUITY FUNDS, EQUITY TRUST, EQUITY
Oxford Bioscience ASSETS AND EQUITY MANAGERS TRUST (SINCE 1993);
Partners AND EQUITY SERIES (SINCE 1998). General
315 Post Road West Partner of Oxford Partners and Oxford
Westport, CT 06880 Bioscience Partners (venture capital
partnerships) and President of Oxford Venture
Corporation; Director of Capital Cash
Management Trust (money market fund) and Prime
Cash Fund.
- 31 -
<PAGE>
Present Position with the Neuberger Berman
Name, Age, and Address (1) Funds; Business Experience During Past Five
---------------------------- Years; Other Trusteeships (2)
-------------------------------------------
Tom Decker Seip (50) NOMINEE. General Partner of Seip Investments
30 Ridge Lane LP (a private investment partnership); Member
Orinda, CA 94563 of the Board of Directors of Offroad Capital
Inc. and E-Finance Corporation (pre-public
internet commerce companies); Trustee of
Hambrecht and Quist Fund Trust; Member of the
Board of Directors of AmericaOne; Senior
executive at the Charles Schwab Corporation
from 1983 to 1999; including Chief Executive
Officer of Charles Schwab Investment
Management, Inc. and Trustee of Schwab Family
of Funds and Schwab Investments from 1997 to
1998; Executive Vice President-Retail Brokerage
for Charles Schwab Investment Management from
1994 to 1997.
Gustave H. Shubert (71) TRUSTEE OF EQUITY FUNDS, EQUITY TRUST, EQUITY
13838 Sunset Boulevard ASSETS AND EQUITY MANAGERS TRUST (SINCE 1993);
Pacific Palisades, CA 90272 AND EQUITY SERIES (SINCE 1998). Senior
Fellow/Corporate Advisor and Advisory Trustee
of Rand (a non-profit public interest research
institution) since 1989; Honorary Member of the
Board of Overseers of the Institute for Civil
Justice, the Policy Advisory Committee of the
Clinical Scholars Program at the University of
California, the American Association for the
Advancement of Science, the Counsel on Foreign
Relations, and the Institute for Strategic
Studies (London); advisor to the Program
Evaluation and Methodology Division of the U.S.
General Accounting Office; formerly Senior Vice
President and Trustee of Rand.
- 32 -
<PAGE>
Present Position with the Neuberger Berman
Name, Age, and Address (1) Funds; Business Experience During Past Five
---------------------------- Years; Other Trusteeships (2)
-------------------------------------------
Candace L. Straight (52) TRUSTEE OF INCOME FUNDS, INCOME TRUST, INCOME
518 E. Passaic Avenue MANAGERS TRUST (SINCE 1993); AND NEUBERGER
Bloomfield, NJ 07003 BERMAN ADVISERS MANAGEMENT TRUST (SINCE 1999).
Private investor and consultant specializing
in the insurance industry; Advisory Director of
Securities Capital LLC (a global private
equity investment firm dedicated to making
investments in the insurance sector); Principal
of Head & Company, LLC (limited liability
company providing investment banking and
consulting services to the insurance industry)
until March 1996; Director of Drake Holdings
(U.K. motor insurer) until June 1996.
Peter E. Sundman* (41) CHAIRMAN OF THE BOARD, CHIEF EXECUTIVE OFFICER,
AND TRUSTEE OF EQUITY FUNDS, EQUITY TRUST,
EQUITY ASSETS, EQUITY SERIES, EQUITY MANAGERS
TRUST AND GLOBAL MANAGERS TRUST; PRESIDENT AND
CHIEF EXECUTIVE OFFICER OF INCOME FUNDS, INCOME
TRUST AND INCOME MANAGERS TRUST; PRESIDENT AND
PRINCIPAL EXECUTIVE OFFICER OF ADVISERS
MANAGERS TRUST (SINCE 1999). Executive Vice
President and Principal of Neuberger Berman,
LLC from 1997 to 1999; President and Director
of NBMI; Executive Vice President and Director
of Neuberger Berman Inc.
Peter P. Trapp (55) TRUSTEE OF NEUBERGER BERMAN ADVISERS MANAGERS
Ford Motor Credit Company TRUST (SINCE 1989). Regional Manager for
1455 Lincoln Parkway Atlanta Region, Ford Motor Credit Company since
Atlanta, GA 30346-2209 August, 1997; prior thereto, President, Ford
Life Insurance Company, April 1995 until August
1997.
(1) UNLESS OTHERWISE INDICATED, THE BUSINESS ADDRESS OF EACH LISTED PERSON IS
605 THIRD AVENUE, NEW YORK, NEW YORK 10158.
(2) EXCEPT AS OTHERWISE INDICATED, EACH INDIVIDUAL HAS HELD THE POSITIONS SHOWN
FOR AT LEAST THE LAST FIVE YEARS.
- 33 -
<PAGE>
* INDICATES A TRUSTEE WHO IS AN "INTERESTED PERSON" OF EACH TRUST WITHIN THE
MEANING OF THE 1940 ACT. MESSRS. KASSEN AND SUNDMAN ARE INTERESTED PERSONS BY
VIRTUE OF THE FACT THAT THEY ARE OFFICERS AND/OR DIRECTORS OF NB MANAGEMENT AND
EXECUTIVE VICE PRESIDENTS OF NEUBERGER BERMAN. MR. O'BRIEN IS AN INTERESTED
PERSON BY VIRTUE OF THE FACT THAT HE IS A DIRECTOR OF LEGG MASON, INC., A WHOLLY
OWNED SUBSIDIARY OF WHICH, FROM TIME TO TIME, SERVES AS A BROKER OR DEALER TO
THE PORTFOLIOS AND OTHER FUNDS FOR WHICH NB MANAGEMENT SERVES AS INVESTMENT
MANAGER.
The current Boards of Trustees of the funds are responsible for general
oversight of the funds' business and operations. The 1940 Act and SEC rules
assign to the Boards or to the Independent Trustees responsibility to consider
and decide certain issues, including some in which the funds' interests may not
be the same as those of management. The Boards of the funds in the Neuberger
Berman family follow certain policies and practices intended to enhance the
independence and effectiveness of the Independent Trustees. These include
separate meetings of the Independent Trustees with counsel of their own
choosing; a Nominating Committee composed entirely of Independent Trustees,
which is responsible for identifying, screening, and naming candidates for the
Board and Board committees and administering the Board's retirement policy; an
Audit Committee composed entirely of Independent Trustees, which operates under
a written charter and meets with each fund's independent auditors or accountants
outside the presence of management; and a policy that compensation for serving
as Independent Trustee must be set by the Independent Trustees. The Boards of
Trustees of Equity Funds, Equity Trust, and Equity Assets each met 6 times and
Equity Series met 4 times during the fiscal year ended August 31, 1999. The
Boards of Trustees of Income Funds and Income Trust each met 4 times during the
fiscal year ended October 31, 1999. All of the Trustees of each fund attended
75% or more of the board meetings during each fund's last fiscal year.
The following Trustees currently serve on the Audit Committee of the Boards
of Trustees of Equity Funds, Equity Trust, Equity Assets and Equity Series:
Howard A. Mileaf (Chairman), Cornelius T. Ryan, and Gustave H. Shubert. The
following Trustees currently serve on the Audit Committee of the Boards of
Trustees of Income Funds and Income Trust: William E. Rulon (Chairman), John
Cannon and Barry Hirsch. The principal duties of the Audit Committees are: (a)
to review the financial and accounting policies of the funds, including internal
accounting control procedures, and to review reports prepared by the funds'
independent auditors and accountants, including reports on the funds' financial
statements; (b) to evaluate the independence of the independent auditors or
accountants and to recommend whether to retain such independent auditors or
accountants for the next fiscal year; (c) to review and recommend approval or
disapproval of audit and non-audit services and the fees charged for such
services; and (d) to report to the Board and make such recommendations as it
deems necessary. The Audit Committee of Equity Funds, Equity Trust, Equity
Assets and Equity Series met one time during the fiscal year ended August 31,
1999. Each member of the Audit Committee attended that meeting. The Audit
Committee of Income Funds and Income Trust met one time during the fiscal year
ended October 31, 1999. Each member of the Audit Committee attended that
meeting.
The following Trustees currently serve on the Nominating Committee of the
Boards of Trustees of Equity Funds, Equity Trust, Equity Assets and Equity
Series: Cornelius T. Ryan (Chairman), John T. Patterson, Jr., and John P.
Rosenthal. The following Trustees currently serve on the Nominating Committee of
the Boards of Trustees of Income Funds and Income Trust: Candace L. Straight
- 34 -
<PAGE>
(Chair) and Barry Hirsch. The Nominating Committees search for and interview
trustee candidates for recommendation to the Boards. The Nominating Committee
will consider nominees for trustee positions that are recommended by
shareholders. Resumes and supporting information should be sent to the attention
of Claudia Brandon, Secretary to the funds, in care of Neuberger Berman, LLC,
605 Third Avenue, 41st Floor, New York, NY 10158-3698. The Nominating Committee
of Equity Funds, Equity Trust, Equity Assets and Equity Series met one time
during the fiscal year ended August 31, 1999. Each member of the Nominating
Committee attended that meeting. The Nominating Committee of Income Funds and
Income Trust met one time during the fiscal year ended October 31, 1999. Each
member of the Nominating Committee attended that meeting. Each Independent
Trustee employed by NBMI or Neuberger Berman receives $32,000 annually and up to
$3,750 for each Board meeting and $750 for each separate meeting of a Board
committee. The preceding amounts and those in the following tables represent
historical compensation. The Independent Trustees are considering whether an
increase in the amount of compensation, and a change in the method of
calculation, would be appropriate in light of the reorganization of the boards
and the funds. They have retained an independent consultant to advise them.
Trustees of the Trust who are employed by NBMI or Neuberger Berman receive no
compensation from the Trust. Trustees are reimbursed for any expenses incurred
in attending meetings. The retirement policy with respect to the Equity Trustees
is determined on a case-by-case basis. Each Income Trustee will be subject to
retirement at the end of the year in which he or she becomes 75 years old. The
following table sets forth information concerning the compensation of the
Trustees of the funds. None of the Neuberger Berman Funds has any retirement
plan for its trustees.
<TABLE>
COMPENSATION TABLE
FISCAL YEAR ENDED AUGUST 31, 1999
NEUBERGER BERMAN EQUITY GROUP OF FUNDS
<CAPTION>
Aggregate Aggregate Aggregate Aggregate Total Compensation from
Compensation Compensation Compensation Compensation Investment Companies in
NAME AND POSITION from Neuberger from Neuberger from Neuberger from Neuberger the Neuberger Berman Fund
----------------- Berman Berman Berman Berman COMPLEX PAID TO TRUSTEES**
EQUITY FUNDS EQUITY ASSETS EQUITY SERIES EQUITY TRUST --------------------------
------------ ------------- ------------- ------------
<S> <C> <C> <C> <C> <C>
Faith Colish $18,571 $276 $31 $6,354 $83,500
Trustee
Stanley Egener* $0 $0 $0 $0 $0
Chairman of the
Board, Chief
Executive Officer,
and Trustee
Howard A. Mileaf $19,402 $283 $31 $6,641 $56,250
Trustee
Edward I. O'Brien $20,038 $296 $31 $6,868 $53,750
Trustee
John T. Patterson, $20,310 $301 $31 $6,966 $58,500
Jr. Trustee
John P. Rosenthal $19,398 $286 $31 $6,643 $56,250
Trustee
Cornelius T. Ryan $16,740 $255 $31 $5,707 $44,750
Trustee
Gustave H. Shubert $19,220 $281 $31 $6,576 $51,500
Trustee
- 35 -
<PAGE>
Aggregate Aggregate Aggregate Aggregate Total Compensation from
Compensation Compensation Compensation Compensation Investment Companies in
Name and Position from Neuberger from Neuberger from Neuberger from Neuberger the Neuberger Berman Fund
----------------- Berman Berman Berman Berman Complex Paid to Trustees**
Equity Funds Equity AssetS Equity Series Equity Trust --------------------------
------------ ------------- ------------- ------------
<S> <C> <C> <C> <C> <C>
Lawrence Zicklin* $0 $0 $0 $0 $0
President and Trustee
</TABLE>
*Retired, October 27, 1999
**No fund within the complex has a bonus, pension, profit sharing or retirement
plan.
<TABLE>
<CAPTION>
COMPENSATION TABLE
FISCAL YEAR ENDED OCTOBER 31, 1999
NEUBERGER BERMAN INCOME GROUP OF FUNDS
Aggregate Aggregate Total Compensation from Trusts
Name and Position Compensation from Compensation from in the Neuberger Berman Fund
with the Trust Income Funds Income Trust Complex Paid to Trustees
--------------- ------------ ------------ ------------------------
<S> <C> <C> <C>
John Cannon $24,579 $671 $52,000
Trustee (1 other investment company)
Stanley Egener* $0 $0 $0
Chairman of the Board, (9 other investment companies)
Chief Executive Officer,
and Trustee
Theodore P. Giuliano $0 $0 $0
President and Trustee (1 other investment company)
Barry Hirsch $23,978 $647 $49,250
Trustee (1 other investment company)
Robert A. Kavesh $24,215 $660 $51,250
Trustee (1 other investment company)
William E. Rulon $23,244 $631 $47,750
Trustee (1 other investment company)
Candace L. Straight $23,978 $647 $51,500
Trustee (1 other investment company)
</TABLE>
* Retired, December 16, 1999.
- 36 -
<PAGE>
REQUIRED VOTE
The election of each Trustee requires approval by a plurality of the votes
cast at the Meeting on the matter.
THE BOARDS OF TRUSTEES, INCLUDING ALL OF THE INDEPENDENT TRUSTEES,
UNANIMOUSLY RECOMMEND THAT YOU VOTE "FOR" EACH NOMINEE IN PROPOSAL 1.
If the Reorganization is not approved, or is approved but not implemented
(see Proposal 4), so that the funds continue in a two-level master-feeder
structure, a vote for a Trustee candidate will be considered authorization for
your Trust to vote for that same candidate as a member of the Board of Trustees
of the master fund.
PROPOSAL 2. MODIFICATION OF FUNDAMENTAL RESTRICTION ON
PORTFOLIO DIVERSIFICATION (ALL FUNDS)
The Boards of Trustees of the funds have approved a change to the
fundamental investment limitations of each fund regarding diversification. The
Boards and NB Management believe that the proposed change will provide the funds
with greater flexibility to respond to certain present and future investment
opportunities. As discussed below, these fundamental restrictions, in their
current form, impede the funds' use of certain portfolio management techniques
that are now used by other mutual funds. Because the policies in question are
fundamental, the changes require shareholder approval before they can be
implemented.
The existing fundamental restriction on issuer diversification would be
changed by adding the underlined portion:
DIVERSIFICATION. The Fund may not, with respect to 75% of the value
of its total assets, purchase the securities of any issuer (other than
securities issued or guaranteed by the U.S. Government or any of its
agencies or instrumentalities, OR SECURITIES ISSUED BY OTHER
INVESTMENT COMPANIES) if, as a result, (i) more than 5% of the value
of the Fund's total assets would be invested in the securities of that
issuer or (ii) the Fund would hold more than 10% of the outstanding
voting securities of that issuer.
The 1940 Act requires all mutual funds to state whether they are
"diversified" or "non-diversified." Each of the Neuberger Berman funds is a
diversified fund and, accordingly, must restrict the percentage of its assets
that can be invested in any one issuer. Diversified funds are generally safer,
because the risk is spread over a larger number of issuers.
The 1940 Act permits a fund, in counting the percentage of its assets
invested in various issuers for diversity purposes, to disregard investments in
U.S. Government securities or securities issued by other investment companies.
The current diversification policies of the funds do not take full advantage of
this provision. Specifically, they do not reflect the exception for investments
in securities of other investment companies.
- 37 -
<PAGE>
The proposed modification would add the exemption for investments in
securities of other investment companies. Among other things, this would allow
the funds' greater flexibility in managing uninvested cash. Like many other fund
groups, the funds have requested permission from the SEC to invest their
uninvested cash in the Neuberger Berman Institutional Cash Trust, a registered
money market fund, as a means of obtaining more efficient and effective
management of the funds' uninvested cash. The proposed change would provide the
funds with greater flexibility to use this investment technique should the SEC
grant the funds' request.1 Although the funds would pay no more in advisory fees
to secure this service than they pay now, the funds may pay an additional fee on
their investment in the underlying fund, Neuberger Berman Institutional Cash
Trust. Institutional Cash Trust pays an administrative fee of 15 basis points.
No fund will be allowed to invest more than 25% of its net assets in
Institutional Cash Trust. Accordingly, the administration fee will not add more
than 3.75 basis points to the expense ratio of any investing fund, and will
typically add considerably less than that.
REQUIRED VOTE
Approval of the change contemplated by Proposal 2 with respect to a fund
requires the affirmative vote of a "majority of the outstanding voting
securities" of that fund, which for this purpose means the affirmative vote of
the lesser of (1) more than 50% of the outstanding shares of the fund or (2) 67%
or more of the shares of the fund present at the Meeting if more than 50% of the
outstanding shares of the fund are represented at the Meeting in person or by
proxy.
If Proposal 4 for conversion to a multi-class system is not approved, but
the change to the diversification policy presented in this Proposal 2 is
approved, such approval would be deemed a change of policy for the respective
feeder fund, plus authority for that fund to cast its vote in favor of an
identical change to the policies of the master fund in which it invests.
If the change contemplated by Proposal 2 is not approved by shareholders of
a fund, the existing fundamental restriction of the fund will continue in effect
for that fund as long as it remains a separate fund; but disapproval of Proposal
2 by the shareholders of one fund will not affect approvals of Proposal 2 by
shareholders of any other fund.
THE BOARD OF TRUSTEES, INCLUDING ALL OF THE INDEPENDENT TRUSTEES,
UNANIMOUSLY RECOMMENDS THAT YOU APPROVE THE MODIFICATION OF THE FUNDAMENTAL
RESTRICTION ON PORTFOLIO DIVERSIFICATION.
PROPOSAL 3. SELECTION OF INDEPENDENT AUDITORS OR ACCOUNTANTS (ALL FUNDS)
The Boards of Trustees of the funds and the master funds in which they
invest, including all of the Independent Trustees, have selected Ernst & Young
LLP to continue to serve as the independent auditors of each of the funds and
their corresponding master funds, except the Neuberger Berman Century Funds,
--------------------
1 Section 12(d)(1) of the 1940 Act contains other limitations on the extent to
which one investment company can invest in another. Specifically, one fund
cannot purchase more than 3% of the outstanding voting securities of another
fund, may not invest more than 5% of its total assets in the other fund, and may
not invest more than 10% of its total assets in the securities of all investment
companies combined. Through their exemptive application to permit joint cash
management, the funds have asked for relief from these limits. There is no
guarantee that the funds will be granted the exemption.
- 38 -
<PAGE>
Manhattan funds, Millennium funds, Regency funds, Socially Responsive funds,
Technology Funds and Neuberger Berman International Portfolio, a master fund
that is a series of Global Managers Trust. Ernst & Young LLP has no direct
financial interest or material indirect financial interest in these funds. The
Board of Trustees has selected Ernst & Young (Cayman Islands Office) to serve as
the independent auditor of NB International Portfolio. Ernst & Young has no
direct financial or material indirect financial interest in NB International
Portfolio. The Boards of Trustees of the funds and the master funds in which
they invest, including all of the Independent Trustees, have selected
PricewaterhouseCoopers LLP to continue to serve as independent accountants of
the Neuberger Berman Century funds, Manhattan funds, the Millennium funds,
Regency funds, Socially Responsive funds and Technology funds.
PricewaterhouseCoopers LLP has no direct financial interest or material indirect
financial interest in these funds. Representatives of Ernst & Young LLP and
PricewaterhouseCoopers LLP are not expected to attend the Meeting, but have been
given the opportunity to make a statement if they so desire, and will be
available should any matter arise requiring their attention.
The independent auditors and accountants examine annual financial
statements for each fund and provide other audit and tax-related services. In
recommending the selection of Ernst & Young LLP and PricewaterhouseCoopers LLP,
the Boards reviewed the nature and scope of the services to be provided
(including any non-audit services) and whether the performance of any non-audit
services would affect the auditors' or accountants' independence.
As described under Proposal 4, if the shareholders of a fund approve the
Agreement and Plan of Reorganization involving that fund (Proposal 4), they will
become holders of shares of the Trust Class, Assets Class or Fund Class of
Equity Funds or Income Funds (Genesis Institutional will have a separate, fourth
class). The boards of trustees of Equity Funds and Income Funds have also
recommended the selection of Ernst & Young LLP and PricewaterhouseCoopers LLP as
independent auditors and accountants of those series of Equity Funds and Income
Funds corresponding to the funds mentioned above. Therefore, immediately after
the Reorganization, the same independent auditors or accountants will serve your
fund (in which you will hold shares in the Trust Class, Assets Class or Fund
Class, or for Genesis Institutional, Institutional Class) that served the fund
in which you held shares prior to the Reorganization.
REQUIRED VOTE
Approval of Proposal 3 requires the affirmative vote of a majority of the
shares present and voting at the Meeting.
If Proposal 4 for conversion to a multi-class system is not approved, but
Proposal 3 is approved, such approval would be considered as a ratification of
the auditors and/or accountants mentioned above with respect to the funds and
their corresponding master funds.
THE BOARDS OF TRUSTEES, INCLUDING ALL OF THE INDEPENDENT TRUSTEES,
UNANIMOUSLY RECOMMEND THAT YOU VOTE TO RATIFY THEIR SELECTION OF THE FUNDS'
INDEPENDENT AUDITORS/ACCOUNTANTS.
- 39 -
<PAGE>
PROPOSAL 4. APPROVAL OF THE PROPOSED REORGANIZATION
At the Meeting, shareholders of Neuberger Berman Equity Trust, Neuberger
Berman Equity Assets, Neuberger Berman Equity Series, and Neuberger Berman
Income Trust will be asked to approve the proposed Reorganizations. Because
Neuberger Berman Equity Funds and Income Funds will survive the proposed
Reorganizations, Equity Funds and Income Funds shareholders are not being asked
to vote.
Neuberger Berman currently sells series of four equity feeder funds, called
Neuberger Berman Equity Funds, Neuberger Berman Equity Trust, Neuberger Berman
Equity Assets and Neuberger Berman Equity Series. Each feeder fund invests in a
series of one of two master funds, called Equity Managers Trust and Global
Managers Trust. If the Reorganizations involving these feeder funds are
approved, the series of three of them will transfer their assets and liabilities
to the corresponding series of the fourth feeder fund. That is, if these
Reorganizations are approved, Equity Trust, Equity Assets, and Equity Series
will each transfer its assets to Equity Funds, in return for shares of a new
class of Equity Funds equal in value to the net assets of the old feeder fund.
The old feeder funds will then distribute to their investors the Equity Funds
shares they have received, making those investors shareholders of Equity Funds,
and the old feeder funds (other than Equity Funds) will dissolve. Equity Funds
will then receive from Equity Managers Trust and Global Managers Trust the
entire portfolio of marketable securities and other assets, and the two master
funds will dissolve. Thus, Equity Funds will no longer operate as a feeder fund
investing in a master fund. Instead, it will own directly the securities
formerly held in the master funds. Investors will hold shares of various classes
of Equity Funds, and the funds will invest directly in securities rather than in
the master funds.
Neuberger Berman currently sells two income feeder funds, known as
Neuberger Berman Income Funds and Neuberger Berman Income Trust, which invest in
a master fund called Income Managers Trust. They will reorganize into a single
fund by the same process described above for the equity funds.
Immediately after the Reorganization, you will hold the same number of
shares, with the same dollar value, as you held immediately before the
Reorganization, and the portfolio of market securities and other assets in which
you're invested will be unchanged.
The following diagram illustrates the structural change that will occur
after the Reorganization.
- 40 -
<PAGE>
BEFORE REORGANIZATION* AFTER REORGANIZATION*
(TWO-TIERED MASTER/FEEDER STRUCTURE) (ONE-TIERED MULTI-CLASS STRUCTURE)
----------------------------------- ---------------------------------
SHAREHOLDERS SHAREHOLDERS SHAREHOLDERS SHAREHOLDERS
BUY SHARES OF BUY SHARES OF
FUND SPOKE TRUST SPOKE ASSETS SPOKE FUNDS (FUND CLASS, TRUST
CLASS, OR ASSET CLASS)
WHICH INVEST IN WHICH INVEST IN
MASTER FUND STOCKS, BONDS AND OTHER
SECURITIES
WHICH INVESTS IN
STOCKS, BONDS AND OTHER SECURITIES
----------------------------------------------------
*THE DIAGRAM SHOWS THREE FEEDER FUNDS, WHICH WILL BECOME THREE CLASSES OF THE
SURVIVING FUND. SOME OF THE MASTER FUNDS HAVE ONLY TWO FEEDER FUNDS, IN WHICH
CASE THE SURVIVING FUND WILL HAVE ONLY TWO CLASSES. IN THE CASE OF NEUBERGER
BERMAN GENESIS, THERE IS A FOURTH FEEDER FUND, WHICH WILL BECOME A FOURTH CLASS
OF THE SURVIVING FUND.
WHAT ARE THE REASONS FOR THE PROPOSED REORGANIZATION?
The reorganization is being proposed because the Boards and NBMI each
believe that eliminating the master-feeder structure and reorganizing into a
multi-class structure would simplify the operations of the funds and,
consequently, may result in some reduction in each fund's operating expenses.
For example, the number equity funds for which annual tax filings are made would
be reduced from 40 to 11, and separate audits of the master funds would no
longer be necessary. Over time, the funds may benefit from the fewer number of
required filings with the Securities and Exchange Commission (the "SEC") and
other legal and administrative cost savings. Some of the cost savings will
benefit NBMI, through its contractual agreements with the funds to limit the
funds' total annual operating expenses.
In addition, NBMI, which serves as each fund's principal underwriter, has
advised the Boards that investors are more familiar with the more common
multi-class structure than they are with the master-feeder structure.
Accordingly, the Reorganization should make it easier to market the funds. While
NBMI would be one beneficiary of such a development, fund shareholders would
also benefit, because increased assets typically result in economies that
produce a lower expense ratio for all investors.
The Board of each fund has determined that it would be in the best
interests of that fund and its shareholders to operate the fund in the single
level, multi-class structure that has become increasingly favored by the mutual
fund industry.
- 41 -
<PAGE>
DESCRIPTION OF THE REORGANIZATION PLAN
The terms and conditions under which the Reorganization would be completed
are set forth in the Reorganization Plan. The following is a summary of the
Reorganization Plan and is qualified in its entirety by reference to the
Reorganization Plan, the form of which is attached as Appendix A. The
Reorganization Plan provides for the completion of the Reorganization in several
steps:
First, each series of Neuberger Berman Equity Trust, Equity Assets and
Equity Series will transfer its assets (which consist primarily of its
interest in the underlying master fund) to the corresponding series of
Equity Funds, in exchange solely for (1) shares of the Trust Class, Asset
Class, or Institutional Class of that corresponding series identical in
number and value to the transferor series's shares held by its shareholders
and (2) the corresponding series's assumption of the transferring series's
liabilities.
Each series of Neuberger Berman Income Trust will transfer its assets
(which consist primarily of its interest in the underlying master fund) to
the corresponding series of Income Funds, in exchange solely for (1) shares
of the Trust Class of that corresponding series identical in number and
value to the fund shares held by its shareholders and (2) the corresponding
series's assumption of the transferring series's liabilities.
Second, each fund will distribute the Trust Class, Asset Class or
Institutional Class shares it receives to its shareholders, and will
dissolve. For example, if you own shares of Neuberger Berman Guardian Trust
(a series of Equity Trust), you would receive in exchange an equal amount
of Trust Class shares of Neuberger Berman Guardian Fund, which is the
corresponding series of Equity Funds. If you own shares of Neuberger Berman
Limited Maturity Bond Trust, you would receive in exchange an equal amount
of Trust Class shares of Neuberger Berman Limited Maturity Bond Fund, which
is the corresponding series of Income Funds.
Third, each series of Equity Funds and Income Funds will withdraw its
investment in its corresponding master fund. Each master fund will
dissolve and distribute its assets in kind (i.e., in the form of
stocks, bonds, and other investments held by the master fund, as well
as any cash) to each corresponding series of Equity Funds and Income
Funds.
Finally, NBMI will enter into investment management agreements with
Equity Funds and Income Funds with provisions identical in all
material respects to those of its current investment management
agreements with the master fund. (If your Fund currently has or
approves a Distribution and Shareholder Servicing Plan, your class of
shares will also have such a plan identical in every material
respect.)
The completion of each Reorganization is subject to various conditions,
including approval of this Proposal by the shareholders of the participating
transferor fund, completion of all filings with, and receipt of all necessary
approvals from, the SEC, delivery of legal opinions regarding the federal tax
consequences of the Reorganization, and other customary corporate and securities
matters. The Boards of Trustees may waive any conditions if, in their judgment,
- 42 -
<PAGE>
such waiver will not have a material adverse effect on shareholders' interest.
The Reorganization Plan for a fund may be terminated at any time prior to
closing if the Board of Trustees of either that fund or the surviving fund
determines in good faith that the Reorganization is not in the best interests of
the shareholders.
FEDERAL TAX CONSEQUENCES OF THE REORGANIZATION
It is a condition to the consummation of the transactions described in each
Reorganization Plan, that each Trust that is a party thereto must have obtained
an opinion of Kirkpatrick & Lockhart LLP, legal counsel to the Trusts,
substantially to the effect that the Reorganization will qualify as a tax-free
reorganization within the meaning of section 368(a)(1) of the Internal Revenue
Code of 1986, as amended (the "Code"). Accordingly, no gain or loss will be
recognized by any fund or its shareholders. The Tax Opinion may state that no
opinion is expressed as to the effect of the Reorganization on the funds or any
shareholder with respect to any asset as to which any unrealized gain or loss is
required to be recognized for federal income tax purposes at the end of a
taxable year (or on the termination or transfer thereof) under a mark-to-market
system of accounting. NBMI intends to recommend to the Board of Trustees of
Neuberger Berman Equity Assets that Socially Responsive Assets be dissolved
prior to Reorganization.
SUMMARY: COMPARISON OF THE FEEDER FUNDS AND THE CLASSES
Equity Funds and Income Funds were organized in December 1992 as business
trusts under the laws of the State of Delaware. Equity Funds is comprised of
eleven diversified series, and Income Funds is comprised of seven diversified
series (the "Portfolios"). If the Reorganization is approved, the Portfolios of
Equity Funds will have three classes of shares: Trust Class, Assets Class and
Fund Class. (Some of the Portfolios will have only Trust and Fund Class shares.
Genesis Portfolio will have a fourth class, Institutional Class, because there
are four Genesis feeder funds.) The Portfolios of Income Funds will have two
classes of shares: Trust Class and Fund Class (only the Institutional Cash
series and Limited Maturity Bond series have both Trust and Fund Classes). If
the Reorganization is completed, shareholders of each fund will become holders
of the Trust Class, Assets Class, Fund Class or Institutional Class shares of
the Portfolio that has the same investment program as the fund currently held by
that shareholder. The net asset value of the shares in a Portfolio class held by
a shareholder immediately after the Reorganization will be the same as the net
asset value of the shares of the corresponding fund held by the shareholder
immediately prior to the Reorganization.
A brief comparison of the funds with the new Portfolios is set forth below:
INVESTMENT OBJECTIVES, POLICIES AND RESTRICTIONS
The investment objectives, policies and restrictions under which the assets
of the funds presently are managed will not be affected by the proposed
Reorganization except that (1) rather than investing all of its net investable
assets in a corresponding master fund, each fund will seek to achieve the same
investment objectives by engaging NBMI as its investment adviser to directly
manage its assets; and (2) if approved by the shareholders of the corresponding
series of Equity Funds and Income Funds, the series will have a slightly more
flexible diversification policy, as described in Proposal 2. The investment
objectives, policies and restrictions of the Portfolios will otherwise be the
same as those in effect for the funds and the master funds immediately prior to
the Reorganization.
- 43 -
<PAGE>
Investment Manager
------------------
NBMI currently manages the assets of each fund indirectly, by virtue of the
fact that it manages the assets of the corresponding master fund in which the
fund invests. Since the funds currently invest their assets only through the
corresponding master funds, they do not engage NBMI or any other investment
manager directly. Upon completion of the Reorganization, Equity Funds and Income
Funds will enter into new investment advisory agreements with NBMI on behalf of
each Portfolio, on terms and conditions substantially identical to the terms and
conditions of the current investment management agreement between NBMI and the
master funds. Neuberger Berman, LLC ("Neuberger Berman"), an affiliate of NBMI
registered as an investment adviser and broker-dealer, also provides services to
each master fund pursuant to a sub-advisory agreement between NBMI and Neuberger
Berman. It would provide such services to each Portfolio of Equity Funds and
Income Funds following the Reorganization.
In each case, it is anticipated that the same individuals would provide
these services, and each series of Equity Funds and Income Funds would pay fees
at the same rate provided for in the current agreements. Accordingly, there will
be no shareholder vote on the new agreement.
In summary, NBMI and Neuberger Berman currently manage the assets of the
funds indirectly, by virtue of the funds' investment in the master funds. After
the Reorganization, NBMI and Neuberger Berman will manage the assets of each
Portfolio directly, according to the same investment program that they employed
for the master funds.
Administrative Services
-----------------------
NBMI serves as administrator of each fund, pursuant to an administration
agreement with each fund, and is responsible for performing all administrative
services required for the daily business operations of the funds. Each of Equity
Trust, Equity Assets, Equity Series and Income Trust has an administration
agreement with NBMI on behalf of its series. After the Reorganization, the
administration agreements with Equity Funds and Income Funds will be amended to
incorporate the multi-class structure of the series, but will otherwise be on
terms and conditions substantially identical to those applicable to the funds
immediately prior to the Reorganization.
Distributor, Transfer Agent and Custodian
-----------------------------------------
NBMI serves as the principal underwriter for the funds pursuant to
distribution agreements with the funds. State Street Bank and Trust Company
serves as the transfer agent and custodian for the funds pursuant to transfer
agency and custodian agreements with the funds. After the Reorganization, those
agreements with Equity Funds and Income Funds will be amended to incorporate the
multi-class structure of the Portfolios, but will otherwise be on terms and
conditions substantially identical to those applicable to the funds immediately
prior to the Reorganization.
- 44 -
<PAGE>
Pro Forma Expenses
------------------
The following tables show the current expenses for each fund, and what the
expenses are expected to be after the proposed Reorganization.
INFORMATION PRESENTED IN THE AS REPORTED COLUMN INCLUDES AN ALLOCATION OF
EXPENSES FROM THE PORTFOLIOS, WHICH WOULD BE BORNE BY THE RESPECTIVE FUNDS IF
THE PROPOSED REORGANIZATION IS APPROVED.
CENTURY FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY FUNDS- CENTURY FUND- FUND
CENTURY FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.81 0.81
Plus: Distribution fees none none
Other expenses** 0.99 0.99
---- ----
Equals: Total annual operating
expenses 1.80 1.80
Expense
Minus: reimbursement 0.30 0.30
---- ----
Equals: Net expenses 1.50 1.50
</TABLE>
* Neuberger Berman Management has contractually agreed to reimburse certain
expenses of the fund through 12/31/02, so that the total annual operating
expenses of the fund are limited to 1.50% of average net assets. This
arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. The fund has agreed to repay Neuberger Berman Management
for expenses reimbursed to the fund provided that repayment does not cause the
fund's annual operating expenses to exceed 1.50% of its average net assets. Any
such repayment must be made within three years after the year in which Neuberger
Berman Management incurred the expense. The as reported column includes costs
paid by the fund and its share of master portfolio costs.
** Other expenses are based on estimated amounts for the current fiscal year.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $153 $474 $818 $1791
EXPENSES- PRO FORMA
(UNAUDITED) (A) $153 $474 $818 $1791
1
<PAGE>
CENTURY TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY TRUST- CENTURY FUND- TRUST
CENTURY TRUST CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.95 0.95
Plus: Distribution fees 0.10 0.10
Other expenses** 0.80 0.80
---- ----
Equals: Total annual operating
expenses 1.85 1.85
Minus: Expense
reimbursement 0.35 0.35
---- ----
Equals: Net expenses 1.50 1.50
</TABLE>
* Neuberger Berman Management has contractually agreed to reimburse certain
expenses of the fund through 12/31/02, so that the total annual operating
expenses of the fund are limited to 1.50% of average net assets. This
arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. The fund has agreed to repay Neuberger Berman Management
for expenses reimbursed to the fund provided that repayment does not cause the
fund's annual operating expenses to exceed 1.50% of its average net assets. Any
such repayment must be made within three years after the year in which Neuberger
Berman Management incurred the expense. The as reported column includes costs
paid by the fund and its share of master portfolio costs.
** Other expenses are based on estimated amounts for the current fiscal year.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $153 $474 $818 $1791
EXPENSES- PRO FORMA
(UNAUDITED) (A) $153 $474 $818 $1791
2
<PAGE>
FOCUS FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY FUNDS- FOCUS FUND- FUND
FOCUS FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.75 0.75
Plus: Distribution fees none none
Other expenses 0.10 0.10
---- ----
Equals: Total annual operating
expenses 0.85 0.85
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $87 $271 $471 $1049
EXPENSES- PRO FORMA
(UNAUDITED) (A) $87 $271 $471 $1049
3
<PAGE>
FOCUS TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY TRUST- FOCUS FUND- TRUST
FOCUS TRUST CLASS
<S> <C> <C> <C>
Shareholder Expenses
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.89 0.89
Plus: Distribution fees 0.10 0.10
Other expenses 0.09 0.09
---- ----
Equals: Total annual operating
expenses 1.08 1.08
</TABLE>
* Neuberger Berman Management reimburses certain expenses of the fund so that
its total annual operating expenses are not more than 0.20% above those of
another Neuberger Berman fund that invests in the same portfolio of securities.
This arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. Under this arrangement, which Neuberger Berman
Management can terminate upon sixty days' notice to the fund, total annual
operating expenses of the fund last year were limited to 0.95% of the fund's
average net assets. Actual expenses this year may be higher or lower. The as
reported column includes costs paid by the fund and its share of master
portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED** $110 $343 $595 $1317
EXPENSES- PRO FORMA
(UNAUDITED) (A)** $110 $343 $595 $1317
**UNDER THE FUND'S EXPENSE REIMBURSEMENT ARRANGEMENT, YOUR COSTS FOR THE ONE-,
THREE-, FIVE- AND TEN-YEAR PERIODS WOULD BE $97, $303, $525, AND $1166,
RESPECTIVELY; OR $97, $303, $525, AND $1166, RESPECTIVELY, AFTER THE PROPOSED
REORGANIZATION.
4
<PAGE>
FOCUS ASSETS
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY ASSETS- FOCUS FUND- ASSETS
FOCUS ASSETS CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.89 0.89
Plus: Distribution fees 0.25 0.25
Other expenses 5.94 5.94
---- ----
Total annual operating
Equals: expenses 7.08 7.08
Expense
Minus: reimbursement** 5.58 5.58
---- ----
Equals: Net expenses 1.50 1.50
</TABLE>
* The as reported column includes costs paid by the fund and its share of master
portfolio costs. ** Neuberger Berman Management has contractually agreed to
reimburse certain expenses of the fund through 12/31/10, so that the total
annual operating expenses of the fund are limited to 1.50% of average net
assets. This arrangement does not cover interest, taxes, brokerage commissions,
and extraordinary expenses.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $153 $474 $818 $1791
EXPENSES- PRO FORMA
(UNAUDITED) (A) $153 $474 $818 $1791
5
<PAGE>
GENESIS FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY FUNDS- GENESIS FUND- FUND
GENESIS FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.98 0.98
Plus: Distribution fees none none
Other expenses 0.19 0.19
---- ----
Total annual operating
Equals: expenses 1.17 1.17
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $119 $372 $644 $1420
EXPENSES- PRO FORMA
(UNAUDITED) (A) $119 $372 $644 $1420
6
<PAGE>
GENESIS TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY TRUST- GENESIS FUND- TRUST
GENESIS TRUST CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 1.12 1.12
Plus: Distribution fees none none
Other expenses 0.11 0.11
---- ----
Total annual operating
Equals: expenses 1.23 1.23
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $125 $390 $676 $1489
EXPENSES- PRO FORMA
(UNAUDITED) (A) $125 $390 $676 $1489
7
<PAGE>
GENESIS ASSETS
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY ASSETS- GENESIS FUND-ASSETS
GENESIS ASSETS CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 1.12 1.12
Plus: Distribution fees 0.25 0.25
Other expenses 0.26 0.26
---- ----
Total annual operating
Equals: expenses 1.63 1.63
Expense
Minus: reimbursement** 0.13 0.13
---- ----
Equals: Net expenses 1.50 1.50
</TABLE>
* The as reported column includes costs paid by the fund and its share of master
portfolio costs. ** Neuberger Berman Management has contractually agreed to
reimburse certain expenses of the fund through 12/31/10, so that the total
annual operating expenses of the fund are limited to 1.50% of average net
assets. This arrangement does not cover interest, taxes, brokerage commissions,
and extraordinary expenses.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $153 $474 $818 $1791
EXPENSES- PRO FORMA
(UNAUDITED) (A) $153 $474 $818 $1791
8
<PAGE>
GENESIS INSTITUTIONAL
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY SERIES-
GENESIS GENESIS FUND- SERIES
INSTITUTIONAL CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.87 0.87
Plus: Distribution fees none none
Other expenses** 0.28 0.28
---- ----
Total annual operating
Equals: expenses 1.15 1.15
Expense
Minus: reimbursement 0.30 0.30
---- ----
Equals: Net expenses 0.85 0.85
</TABLE>
* Neuberger Berman Management has contractually agreed to reimburse certain
expenses of the fund through 12/31/02, so that the total annual operating
expenses of the fund are limited to 0.85% of average net assets. This
arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. The as reported column includes costs paid by the fund
and its share of master portfolio costs.
** Other expenses are based on estimated amounts for the current fiscal year.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $87 $271 $471 $1049
EXPENSES- PRO FORMA
(UNAUDITED) (A) $87 $271 $471 $1049
9
<PAGE>
GUARDIAN FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY FUNDS- GUARDIAN FUND- FUND
GUARDIAN FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.70 0.70
Plus: Distribution fees none none
Other expenses 0.12 0.12
---- ----
Total annual operating
Equals: expenses 0.82 0.82
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $84 $262 $455 $1014
EXPENSES- PRO FORMA
(UNAUDITED) (A) $84 $262 $455 $1014
10
<PAGE>
GUARDIAN TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY TRUST- GUARDIAN FUND- TRUST
GUARDIAN TRUST CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.84 0.84
Plus: Distribution fees none none
Other expenses 0.04 0.04
---- ----
Total annual operating
Equals: expenses 0.88 0.88
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $90 $281 $488 $1084
EXPENSES- PRO FORMA
(UNAUDITED) (A) $90 $281 $488 $1084
11
<PAGE>
GUARDIAN ASSETS
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY ASSETS- GUARDIAN FUND- ASSETS
GUARDIAN ASSETS CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.84 0.84
Plus: Distribution fees 0.25 0.25
Other expenses 0.47 0.47
---- ----
Total annual operating
Equals: expenses 1.56 1.56
Expense
Minus: reimbursement** 0.06 0.06
---- ----
Equals: Net expenses 1.50 1.50
</TABLE>
* The as reported column includes costs paid by the fund and its share of master
portfolio costs. ** Neuberger Berman Management has contractually agreed to
reimburse certain expenses of the fund through 12/31/10, so that the total
annual operating expenses of the fund are limited to 1.50% of average net
assets. This arrangement does not cover interest, taxes, brokerage commissions,
and extraordinary expenses.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $153 $474 $818 $1791
EXPENSES- PRO FORMA
(UNAUDITED) (A) $153 $474 $818 $1791
12
<PAGE>
INTERNATIONAL FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY FUNDS-
INTERNATIONAL INTERNATIONAL FUND-
FUND FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 1.11 1.11
Plus: Distribution fees none none
Other expenses 0.48 0.48
---- ----
Total annual operating
Equals: expenses 1.59 1.59
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $162 $502 $866 $1889
EXPENSES- PRO FORMA
(UNAUDITED) (A) $162 $502 $866 $1889
13
<PAGE>
INTERNATIONAL TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY TRUST-
INTERNATIONAL INTERNATIONAL FUND-
TRUST TRUST CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 1.25 1.25
Plus: Distribution fees none none
Other expenses 4.73 4.73
---- ----
Total annual operating
Equals: expenses 5.98 5.98
</TABLE>
* Neuberger Berman Management reimburses certain expenses of the fund so that
its total annual operating expenses are not more than 0.10% above those of
another Neuberger Berman fund that invests in the same portfolio of securities
but not to exceed 1.70% 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 as reported column includes costs paid by the fund and its share
of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED** $595 $1768 $2918 $5695
EXPENSES- PRO FORMA
(UNAUDITED) (A)** $595 $1768 $2918 $5695
** UNDER THE FUND'S EXPENSE REIMBURSEMENT ARRANGEMENT, YOUR COSTS FOR THE ONE-,
THREE-, FIVE- AND TEN-YEAR PERIODS WOULD BE $173, $536, $923, AND
$2009, RESPECTIVELY; OR $173, $536, $923, AND $2009, RESPECTIVELY AFTER THE
PROPOSED REORGANIZATION.
14
<PAGE>
MANHATTAN FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY FUNDS- MANHATTAN FUND-
MANHATTAN FUND FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.79 0.79
Plus: Distribution fees none none
Other expenses 0.21 0.21
---- ----
Total annual operating
Equals: expenses 1.00 1.00
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $102 $318 $552 $1225
EXPENSES- PRO FORMA
(UNAUDITED) (A) $102 $318 $552 $1225
15
<PAGE>
MANHATTAN TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY TRUST- MANHATTAN FUND-
MANHATTAN TRUST TRUST CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.93 0.93
Plus: Distribution fees none none
Other expenses 0.25 0.25
---- ----
Total annual operating
Equals: expenses 1.18 1.18
</TABLE>
* Neuberger Berman Management reimburses certain expenses of the fund so that
its total annual operating expenses are not more than 0.10% above those of
another Neuberger Berman fund that invests in the same portfolio of securities.
This arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. Under this arrangement, which Neuberger Berman
Management can terminate upon sixty days' notice to the fund, total annual
operating expenses of the fund last year were limited to 1.11% of the fund's
average net assets. Actual expenses this year may be higher or lower. The as
reported column includes costs paid by the fund and its share of master
portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED** $120 $375 $649 $1432
EXPENSES- PRO FORMA
(UNAUDITED) (A)** $120 $375 $649 $1432
** UNDER THE FUND'S EXPENSE REIMBURSEMENT ARRANGEMENT, YOUR COSTS FOR THE ONE-,
THREE-, FIVE- AND TEN-YEAR PERIODS WOULD BE $113, $353, $612, AND $1352,
RESPECTIVELY; OR $113, $353, $612, AND $1352, RESPECTIVELY, AFTER THE PROPOSED
REORGANIZATION.
16
<PAGE>
MANHATTAN ASSETS
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY ASSETS- MANHATTAN FUND-
MANHATTAN ASSETS ASSETS CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.93 0.93
Plus: Distribution fees 0.25 0.25
Other expenses 18.81 18.81
----- -----
Total annual operating
Equals: expenses 19.99 19.99
Expense
Minus: reimbursement** 18.49 18.49
----- -----
Equals: Net expenses 1.50 1.50
</TABLE>
* The as reported column includes costs paid by the fund and its share of master
portfolio costs. ** Neuberger Berman Management has contractually agreed to
reimburse certain expenses of the fund through 12/31/10, so that the total
annual operating expenses of the fund are limited to 1.50% of average net
assets. This arrangement does not cover interest, taxes, brokerage commissions,
and extraordinary expenses.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $153 $474 $818 $1791
EXPENSES- PRO FORMA
(UNAUDITED) (A) $153 $474 $818 $1791
17
<PAGE>
MILLENNIUM FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY FUNDS- MILLENNIUM FUND-
MILLENNIUM FUND FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 1.11 1.11
Plus: Distribution fees none none
Other expenses 1.02 1.02
---- ----
Total annual operating
Equals: expenses 2.13 2.13
</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 fund has agreed to repay Neuberger
Berman Management through 12/31/00 for expenses reimbursed to the fund through
12/31/99 provided that repayment does not cause the fund's annual operating
expenses to exceed 1.75% of its average net assets. The as reported column
includes costs paid by the fund and its share of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED** $216 $667 $1144 $2462
EXPENSES- PRO FORMA
(UNAUDITED) (A)** $216 $667 $1144 $2462
** UNDER THE FUND'S EXPENSE REIMBURSEMENT ARRANGEMENT, YOUR COSTS FOR THE ONE-,
THREE-, FIVE- AND TEN-YEAR PERIODS WOULD BE $178, $551, $949, AND $2062,
RESPECTIVELY; OR $178, $551, $949, AND $2062, RESPECTIVELY AFTER THE PROPOSED
REORGANIZATION.
18
<PAGE>
MILLENNIUM TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY TRUST- MILLENNIUM FUND-
MILLENNIUM TRUST TRUST CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 1.25 1.25
Plus: Distribution fees 0.10 0.10
Other expenses 12.14 12.14
----- -----
Total annual operating
Equals: expenses 13.49 13.49
Expense
Minus: reimbursement** 11.74 11.74
----- -----
Equals: Net expenses 1.75 1.75
</TABLE>
* The as reported column includes costs paid by the fund and its share of master
portfolio costs.
** Neuberger Berman Management has contractually agreed to reimburse certain
expenses of the fund through 12/31/09 so that the total annual operating
expenses of the fund are limited to 1.75% of average net assets.
This arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. The fund has agreed to repay Neuberger Berman Management
through 12/31/00 for expenses reimbursed to the fund through 12/31/99 provided
that repayment does not cause the fund's annual operating expenses to exceed
1.75% of its average net assets.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $178 $551 $949 $2062
EXPENSES- PRO FORMA
(UNAUDITED) (A) $178 $551 $949 $2062
19
<PAGE>
MILLENNIUM ASSETS
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY ASSETS- MILLENNIUM FUND-
MILLENNIUM ASSETS ASSETS CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 1.25 1.25
Plus: Distribution fees 0.25 0.25
Other expenses** 0.57 0.57
---- ----
Total annual operating
Equals: expenses 2.07 2.07
Expense
Minus: reimbursement 0.32 0.32
---- ----
Equals: Net expenses 1.75 1.75
</TABLE>
* Neuberger Berman Management has contractually agreed to reimburse certain
expenses of the fund through 12/31/02 so that the total annual operating
expenses of the fund are limited to 1.75% of average net assets.
This arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. The as reported column includes costs paid by the fund
and its share of master portfolio costs. ** Other expenses are estimated for the
current fiscal year.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $178 $551 $949 $2062
EXPENSES- PRO FORMA
(UNAUDITED) (A) $178 $551 $949 $2062
20
<PAGE>
PARTNERS FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY FUNDS- PARTNERS FUND- FUND
PARTNERS FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.71 0.71
Plus: Distribution fees none none
Other expenses 0.11 0.11
---- ----
Total annual operating
Equals: expenses 0.82 0.82
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $84 $262 $455 $1014
EXPENSES- PRO FORMA
(UNAUDITED) (A) $84 $262 $455 $1014
21
<PAGE>
PARTNERS TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY TRUST- PARTNERS FUND-TRUST
PARTNERS TRUST CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.85 0.85
Plus: Distribution fees none none
Other expenses 0.06 0.06
---- ----
Total annual operating
Equals: expenses 0.91 0.91
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $93 $290 $504 $1120
EXPENSES- PRO FORMA
(UNAUDITED) (A) $93 $290 $504 $1120
22
<PAGE>
PARTNERS ASSETS
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY ASSETS- PARTNERS FUND-ASSETS
PARTNERS ASSETS CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.85 0.85
Plus: Distribution fees 0.25 0.25
Other expenses 0.21 0.21
---- ----
Total annual operating
Equals: expenses 1.31 1.31
</TABLE>
* Neuberger Berman Management has contractually agreed to reimburse certain
expenses of the fund through 12/31/10, so that the total annual operating
expenses of the fund are limited to 1.50% of average net assets. This
arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. The as reported column includes costs paid by the fund
and its share of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $133 $415 $718 $1579
EXPENSES- PRO FORMA
(UNAUDITED) (A) $133 $415 $718 $1579
23
<PAGE>
REGENCY FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY FUNDS- REGENCY FUND- FUND
REGENCY FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.81 0.81
Plus: Distribution fees none none
Other expenses** 0.99 0.99
---- ----
Total annual operating
Equals: expenses 1.80 1.80
Expense
Minus: reimbursement 0.30 0.30
---- ----
Equals: Net expenses 1.50 1.50
</TABLE>
* Neuberger Berman Management has contractually agreed to reimburse certain
expenses of the fund through 12/31/02, so that the total annual operating
expenses of the fund are limited to 1.50% of average net assets. This
arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. The fund has agreed to repay Neuberger Berman Management
for expenses reimbursed to the fund provided that repayment does not cause the
fund's annual operating expenses to exceed 1.50% of its average net assets. Any
such repayment must be made within three years after the year in which Neuberger
Berman Management incurred the expense. The as reported column includes costs
paid by the fund and its share of master portfolio costs.
** Other expenses are based on estimated amounts for the current fiscal year.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $153 $474 $818 $1791
EXPENSES- PRO FORMA
(UNAUDITED) (A) $153 $474 $818 $1791
24
<PAGE>
REGENCY TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY TRUST- REGENCY FUND-TRUST
REGENCY TRUST CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.95 0.95
Plus: Distribution fees 0.10 0.10
Other expenses** 0.88 0.88
---- ----
Total annual operating
Equals: expenses 1.93 1.93
Expense
Minus: reimbursement 0.43 0.43
---- ----
Equals: Net expenses 1.50 1.50
</TABLE>
* Neuberger Berman Management has contractually agreed to reimburse certain
expenses of the fund through 12/31/02, so that the total annual operating
expenses of the fund are limited to 1.50% of average net assets or not more than
0.20% above the total annual operating expenses of another Neuberger Berman fund
that invests in the same portfolio of securities whichever is less. This
arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. The fund has agreed to repay Neuberger Berman Management
for expenses reimbursed to the fund provided that repayment does not cause the
fund's annual operating expenses to exceed 1.50% of its average net assets. Any
such repayment must be made within three years after the year in which Neuberger
Berman Management incurred the expense. The as reported column includes costs
paid by the fund and its share of master portfolio costs.
** Other expenses are based on estimated amounts for the current fiscal year.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $153 $474 $818 $1791
EXPENSES- PRO FORMA
(UNAUDITED) (A) $153 $474 $818 $1791
25
<PAGE>
SOCIALLY RESPONSIVE FUND
FEE TABLE
<TABLE>
<CAPTION>
AS REPORTED PRO FORMA (UNAUDITED)
EQUITY FUNDS- (A)
SOCIALLY SOCIALLY RESPONSIVE
RESPONSIVE FUND FUND- FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.80 0.80
Plus: Distribution fees none none
Other expenses 0.30 0.30
---- ----
Total annual operating
Equals: expenses 1.10 1.10
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $112 $350 $606 $1340
EXPENSES- PRO FORMA
(UNAUDITED) (A) $112 $350 $606 $1340
26
<PAGE>
SOCIALLY RESPONSIVE TRUST
FEE TABLE
<TABLE>
<CAPTION>
AS REPORTED PRO FORMA (UNAUDITED)
EQUITY TRUST- (A)
SOCIALLY SOCIALLY RESPONSIVE
RESPONSIVE TRUST FUND- TRUST CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.94 0.94
Plus: Distribution fees 0.10 0.10
Other expenses** 0.78 0.78
---- ----
Total annual operating
Equals: expenses 1.82 1.82
</TABLE>
* Neuberger Berman Management reimburses certain expenses of the fund so that
its total annual operating expenses are not more than 0.20% above those of
another Neuberger Berman fund that invests in the same portfolio of securities.
This arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. Under this arrangement, which Neuberger Berman
Management can terminate upon sixty days' notice to the fund, total annual
operating expenses of the fund last year would have been limited to 1.20% of the
fund's average net assets. Actual expenses this year may be higher or lower. The
as reported column includes costs paid by the fund and its share of master
portfolio costs.
** At current asset levels, the fund believes "Management Fees" and "Total
annual operating expenses" will be 0.95% and 1.83% of average net assets for the
current fiscal year. As described above, however, Neuberger Berman Management
has agreed to reimburse certain expenses of the fund so actual expenses will be
lower.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED*** $185 $573 $985 $2137
EXPENSES- PRO FORMA
(UNAUDITED) (A)*** $185 $573 $985 $2137
*** UNDER THE FUND'S EXPENSE REIMBURSEMENT ARRANGEMENT, YOUR COSTS FOR THE ONE-,
THREE-, FIVE- AND TEN-YEAR PERIODS WOULD BE $122, $381, $660, AND $1455,
RESPECTIVELY; OR $122, $381, $660, AND $1455, RESPECTIVELY, AFTER THE PROPOSED
REORGANIZATION.
27
<PAGE>
SOCIALLY RESPONSIVE ASSETS
FEE TABLE
<TABLE>
<CAPTION>
AS REPORTED PRO FORMA (UNAUDITED)
EQUITY ASSETS- (A)
SOCIALLY SOCIALLY RESPONSIVE
RESPONSIVE ASSETS FUND- ASSETS CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.95 0.95
Plus: Distribution fees 0.25 0.25
Other expenses** 0.54 0.54
---- ----
Total annual operating
Equals: expenses 1.74 1.74
Expense
Minus: reimbursement 0.24 0.24
---- ----
Equals: Net expenses 1.50 1.50
</TABLE>
* Neuberger Berman Management has contractually agreed to reimburse certain
expenses of the fund through 12/31/02, so that the total annual operating
expenses of the fund are limited to 1.50% of average net assets. This
arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. The fund has agreed to repay Neuberger Berman Management
for expenses reimbursed to the fund provided that repayment does not cause the
fund's annual operating expenses to exceed 1.50% of its average net assets. Any
such repayment must be made within three years after the year in which Neuberger
Berman Management incurred the expense. The as reported column includes costs
paid by the fund and its share of master portfolio costs.
** Other expenses are based on estimated amounts for the current fiscal year.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $153 $474 $818 $1791
EXPENSES- PRO FORMA
(UNAUDITED) (A) $153 $474 $818 $1791
28
<PAGE>
TECHNOLOGY FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY FUNDS- TECHNOLOGY FUND-
TECHNOLOGY FUND FUND CLASS
<S> <C> <C> <C>
Shareholder Fees (% of
amount redeemed or
exchanged)
These are deducted
directly from your
investment.
Redemption Fee* 2.00 2.00
Exchange Fee* 2.00 2.00
* A redemption fee of 2.00% is charged on investments held 180 days or less,
whether fund shares are redeemed or exchanged for shares of another fund.
Annual operating
expenses (% of ANA)**
These are deducted from
fund assets, so you pay
them indirectly
Management Fees 1.11 1.11
Plus: Distribution fees none none
Other expenses*** 0.91 0.91
---- ----
Total annual operating
Equals: expenses 2.02 2.02
Expense
Minus: reimbursement 0.02 0.02
---- ----
Equals: Net expenses 2.00 2.00
</TABLE>
** Neuberger Berman Management has contractually agreed to reimburse certain
expenses of the fund through 12/31/03, so that the total annual operating
expenses of the fund are limited to 2.00% of average net assets. In addition,
the arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. The fund has agreed to repay Neuberger Berman Management
for expenses reimbursed to the fund provided that the repayment does not cause
the fund's annual operating expenses to exceed 2.00% of its average net assets.
Any such repayment must be made within three years after the year in which
Neuberger Berman Management incurred the expense. The as reported column
includes costs paid by the fund and its share of master portfolio costs.
*** Other expenses are based on estimated amounts for the current fiscal year.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $203 $627 $1078 $2327
EXPENSES- PRO FORMA
(UNAUDITED) (A) $203 $627 $1078 $2327
29
<PAGE>
TECHNOLOGY TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (A)
EQUITY TRUST- TECHNOLOGY FUND-
TECHNOLOGY TRUST TRUST CLASS
<S> <C> <C> <C>
Shareholder Fees (% of
amount redeemed or
exchanged)
These are deducted
directly from your
investment.
Redemption Fee* 2.00 2.00
Exchange Fee* 2.00 2.00
* A redemption fee of 2.00% is charged on investments held 180 days or less,
whether fund shares are redeemed or exchanged for shares of another fund.
Annual operating
expenses (% of
ANA)**
These are deducted from
fund assets, so you pay
them indirectly
Management Fees 1.25 1.25
Plus: Distribution fees 0.10 0.10
Other expenses*** 0.80 0.80
---- ----
Total annual operating
Equals: expenses 2.15 2.15
Expense
Minus: reimbursement 0.15 0.15
---- ----
Equals: Net expenses 2.00 2.00
</TABLE>
** Neuberger Berman Management has contractually agreed to reimburse certain
expenses of the fund through 12/31/03, so that the total annual operating
expenses of the fund are limited to 2.00% of average net assets. In addition,
the arrangement does not cover interest, taxes, brokerage commissions, and
extraordinary expenses. The fund has agreed to repay Neuberger Berman Management
for expenses reimbursed to the fund provided that the repayment does not cause
the fund's annual operating expenses to exceed 2.00% of its average net assets.
Any such repayment must be made within three years after the year in which
Neuberger Berman Management incurred the expense. The as reported column
includes costs paid by the fund and its share of master portfolio costs.
*** Other expenses are based on estimated amounts for the current fiscal year.
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.
1 Year 3 Years 5 Years 10 Years
EXPENSES- AS REPORTED $203 $627 $1078 $2327
EXPENSES- PRO FORMA
(UNAUDITED) (A) $203 $627 $1078 $2327
(A) EXPENSES ARE EXPECTED TO BE REDUCED AS A RESULT OF THE REORGANIZATION.
BECAUSE THE COMPANY IS UNABLE TO ESTIMATE ANY AMOUNTS, NO REDUCTIONS ARE
PRESENTED.
30
<PAGE>
INFORMATION PRESENTED IN THE AS REPORTED COLUMN INCLUDES AN ALLOCATION OF
EXPENSES FROM THE PORTFOLIOS, WHICH WOULD BE BORNE BY THE RESPECTIVE FUNDS IF
THE PROPOSED REORGANIZATION IS APPROVED.
CASH RESERVES
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (a)
INCOME FUNDS- CASH RESERVES-FUND
CASH RESERVES CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.51 0.51
Plus: Distribution fees none none
Other expenses 0.10 0.10
Total annual operating ---- ----
Equals: expenses 0.61 0.61
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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- AS REPORTED $62 $195 $340 $762
EXPENSES- PRO FORMA
(UNAUDITED) (a) $62 $195 $340 $762
</TABLE>
<PAGE>
GOVERNMENT MONEY FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
(a)
AS REPORTED
INCOME FUNDS
GOVERNMENT GOVERNMENT MONEY
MONEY FUND FUND-FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.52 0.52
Plus: Distribution fees none none
Other expenses 0.08 0.08
Total annual operating ---- ----
Equals: expenses 0.60 0.60
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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- AS REPORTED $61 $192 $335 $750
EXPENSES- PRO FORMA
(UNAUDITED) (a) $61 $192 $335 $750
</TABLE>
<PAGE>
HIGH YIELD BOND FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (a)
INCOME FUNDS-
HIGH YIELD BOND HIGH YIELD BOND FUND-
FUND FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.65 0.65
Plus: Distribution fees none none
Other expenses 0.78 0.78
Total annual operating ---- ----
Equals: expenses 1.43 1.43
</TABLE>
* Neuberger Berman Management reimburses certain expenses of the fund so that
the total annual operating expenses of the fund are limited to 1.00% of average
net assets. This arrangement can be terminated upon 60 days' notice to the fund.
In addition, the arrangement does not cover interest, taxes, brokerage
commissions, and extraordinary expenses. The as reported column includes costs
paid by the fund and its share of master portfolio costs.
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- AS REPORTED** $146 $452 $782 $1713
EXPENSES- PRO FORMA
(UNAUDITED) (a)** $146 $452 $782 $1713
</TABLE>
**UNDER THE FUND'S EXPENSE REIMBURSEMENT ARRANGEMENT, YOUR COSTS FOR THE ONE-,
THREE-, FIVE- AND TEN-YEAR PERIODS WOULD BE $102, $318, $552, AND $1225,
RESPECTIVELY; OR $102, $318, $552 AND $1225, RESPECTIVELY, AFTER THE PROPOSED
REORGANIZATION.
<PAGE>
LIMITED MATURITY BOND FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNADUTIED)
AS REPORTED (a)
INCOME FUNDS-
LIMITED MATURITY LIMITED MATURITY BOND FUND
BOND FUND FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.52 0.52
Plus: Distribution fees none none
Other expenses 0.20 0.20
Total annual operating ---- ----
Equals: expenses 0.72 0.72
</TABLE>
* Neuberger Berman Management reimburses certain expenses of the fund so that
the total annual operating expenses of the fund are limited to 0.70% of average
net assets. This arrangement can be terminated upon 60 days' notice to the fund.
In addition, the arrangement does not cover interest, taxes, brokerage
commissions, and extraordinary expenses. The as reported column includes costs
paid by the fund and its share of master portfolio costs.
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- AS REPORTED** $74 $230 $401 $894
EXPENSES- PRO FORMA
(UNAUDITED) (a)** $74 $230 $401 $894
</TABLE>
**UNDER THE FUND'S EXPENSE REIMBURSEMENT ARRANGEMENT, YOUR COSTS FOR THE ONE-,
THREE-, FIVE- AND TEN-YEAR PERIODS WOULD BE $72, $224, $390, AND $871,
RESPECTIVELY; OR $72, $224, $390, AND $871, RESPECTIVELY, AFTER THE PROPOSED
REORGANIZATION.
<PAGE>
LIMITED MATURITY BOND TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (a)
INCOME TRUST-
LIMITED MATURITY LIMITED MATURITY BOND
BOND TRUST FUND- TRUST CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.75 0.75
Plus: Distribution fees none none
Other expenses 0.37 0.37
Total annual operating ---- ----
Equals: expenses 1.12 1.12
</TABLE>
* Neuberger Berman Management reimburses certain expenses of the fund so that
the total annual operating expenses of the fund are limited to 0.80% of average
net assets. This arrangement may be terminated upon 60 days' notice to the fund.
In addition, this arrangement does not cover interest, taxes, brokerage
commissions, and extraordinary expenses. The as reported column includes costs
paid by the fund and its share of master portfolio costs.
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- AS REPORTED** $114 $356 $617 $1363
EXPENSES- PRO FORMA
(UNAUDITED) (a)** $114 $356 $617 $1363
</TABLE>
**UNDER THE FUND'S EXPENSE REIMBURSEMENT ARRANGEMENT, YOUR COSTS FOR THE ONE-,
THREE-, FIVE- AND TEN-YEAR PERIODS WOULD BE $82, $255, $444, AND $990,
RESPECTIVELY; OR $82, $255, $444, AND $990, RESPECTIVELY, AFTER THE PROPOSED
REORGANIZATION.
<PAGE>
MUNICIPAL MONEY FUND
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (a)
INCOME FUNDS-
MUNICIPAL MONEY MUNICIPAL MONEY
FUND FUND-FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.52 0.52
Plus: Distribution fees none none
Other expenses 0.15 0.15
Total annual operating ---- ----
Equals: expenses 0.67 0.67
</TABLE>
* The figures in the table are based on last year's expenses. Actual expenses
this year may be higher or lower. The as reported column includes costs paid by
the fund and its share of master portfolio costs.
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- AS REPORTED $68 $214 $373 $835
EXPENSES- PRO FORMA
(UNAUDITED) (a) $68 $214 $373 $835
</TABLE>
<PAGE>
MUNICIPAL SECURITIES TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (a)
INCOME FUNDS-
MUNICIPAL MUNICIPAL SECURITIES
SECURITIES TRUST TRUST-FUND CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.52 0.52
Plus: Distribution fees none none
Other expenses 0.55 0.55
Total annual operating ---- ----
Equals: expenses 1.07 1.07
</TABLE>
* Neuberger Berman Management reimburses certain expenses of the fund so that
the total annual operating expenses of the fund are limited to 0.65% of average
net assets. This arrangement may be terminated upon 60 days' notice to the fund.
In addition, this arrangement does not cover interest, taxes, brokerage
commissions, and extraordinary expenses. The as reported column includes costs
paid by the fund and its share of master portfolio costs.
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- AS REPORTED** $109 $340 $590 $1306
EXPENSES- PRO FORMA
(UNAUDITED) (a)** $109 $340 $590 $1306
</TABLE>
**UNDER THE FUND'S EXPENSE REIMBURSEMENT ARRANGEMENT, YOUR COSTS FOR THE ONE-,
THREE-, FIVE- AND TEN-YEAR PERIODS WOULD BE $66, $208, $362, AND $810,
RESPECTIVELY; OR $66, $208, $362, AND $810, RESPECTIVELY, AFTER THE PROPOSED
REORGANIZATION.
<PAGE>
INSTITUTIONAL CASH TRUST
FEE TABLE
<TABLE>
<CAPTION>
PRO FORMA (UNAUDITED)
AS REPORTED (a)
INCOME TRUST-
INSTITUTIONAL CASH INSTITUTIONAL CASH
TRUST FUND- TRUST CLASS
<S> <C> <C> <C>
Shareholder Expenses none none
Annual operating
expenses (% of ANA)*
These are deducted
from fund assets,
so you pay them
indirectly
Management Fees 0.25 0.25
Plus: Distribution fees none none
Other expenses** 0.16 0.16
Total annual operating ---- ----
Equals: expenses 0.41 0.41
</TABLE>
* The as reported column includes costs paid by the fund and its share of master
portfolio costs. ** Other expenses are based on estimated amounts for the
current fiscal year.
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- AS REPORTED $42 $132 $230 $518
EXPENSES- PRO FORMA
(UNAUDITED) (a) $42 $132 $230 $518
</TABLE>
(a) EXPENSES ARE EXPECTED TO BE REDUCED AS A RESULT OF THE REORGANIZATION.
BECAUSE THE COMPANY IS UNABLE TO ESTIMATE ANY AMOUNTS, NO REDUCTIONS ARE
PRESENTED.
<PAGE>
Pro Forma Capitalization
------------------------
Pro forma capitalization information is included here for the various
classes:
Most of the following tables are as of August 31, 1999, the date of the latest
audited fiscal period. Except for Technology, those funds that began
operations after August 31, 1999 are shown as of February 29, 2000.
Because Technology started operations after February 29, 2000 its
capitalization table is as of June 30, 2000.
<TABLE>
<CAPTION>
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF FEBRUARY 29, 2000 PRO FORMA AS OF FEBRUARY 29, 2000 (UNAUDITED)
FUNDS INVESTING IN CENTURY PORTFOLIO CENTURY FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY FUNDS- CENTURY FUND $2,344 $ 12.38 $ 29,013 FUND CLASS 2,344 $ 12.38 $ 29,013
172 $ 12.38 $ 2,124 TRUST CLASS 172 $ 12.38 $ 2,124
EQUITY TRUST- CENTURY TRUST --------- ----------------
$ 31,137 $ 31,137
If the reorganization is approved, shareholders invested in the Equity Funds -
Century Fund or Equity Trust - Century Trust will become shareholders of the
Fund Class or Trust Class of Century Fund, respectively.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF AUGUST 31, 1999 PRO FORMA AS OF AUGUST 31, 1999 (UNAUDITED)
FUNDS INVESTING IN FOCUS PORTFOLIO FOCUS FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY ASSETS- FOCUS ASSETS 117 $ 16.18 $ 1,899 ASSET CLASS 117 $ 16.18 $ 1,899
EQUITY FUNDS- FOCUS FUND 36,598 $ 36.25 $ 1,326,608 FUND CLASS 36,598 $ 36.25 $ 1,326,608
1
<PAGE>
EQUITY TRUST- FOCUS TRUST 9,145 $ 23.62 $ 216,020 TRUST CLASS 9,145 $ 23.62 $ 216,020
---------- ----------------
$1,544,527 1,544,527
If the reorganization is approved, shareholders invested in the
Equity Assets - Focus Assets, Equity Funds - Focus Fund or Equity Trust -
Focus Trust will become shareholders of the Asset Class,
Fund Class or Trust Class of Focus Fund, respectively.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF AUGUST 31, 1999 PRO FORMA AS OF AUGUST 31, 1999 (UNAUDITED)
FUNDS INVESTING IN GENESIS PORTFOLIO GENESIS FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY SERIES- GENESIS INSTITUTIONAL 11,058 $ 20.28 $ 224,224 SERIES CLASS 11,058 $ 20.28 $ 224,224
EQUITY ASSETS- GENESIS ASSETS 6,473 $ 12.64 $ 81,805 ASSET CLASS 6,473 $ 12.64 $ 81,805
EQUITY FUNDS- GENESIS FUND 59,152 $ 14.39 $ 851,255 FUND CLASS 59,152 $ 14.39 $ 851,255
EQUITY TRUST- GENESIS TRUST 29,177 $ 20.26 $ 591,109 TRUST CLASS 29,177 $ 20.26 $ 591,109
----------- ----------------
$ 1,748,393 $ 1,748,393
If the reorganization is approved, shareholders invested in the Equity Series-
Genesis Institutional, Equity Assets - Genesis Assets, Equity Funds - Genesis
Fund or Equity Trust - Genesis Trust will become shareholders of the Series
Class, Asset Class, Fund Class or Trust Class of Genesis Fund, respectively.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF AUGUST 31, 1999 PRO FORMA AS OF AUGUST 31, 1999 (UNAUDITED)
FUNDS INVESTING IN GUARDIAN PORTFOLIO GUARDIAN FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY ASSETS- GUARDIAN ASSETS 1,834 $ 13.54 $ 24,829 ASSET CLASS 1,834 $ 13.54 $ 24,829
EQUITY FUNDS- GUARDIAN FUND 151,434 $ 22.72 $ 3,441,033 FUND CLASS 151,434 $ 22.72 $ 3,441,033
EQUITY TRUST- GUARDIAN TRUST 76,470 $ 16.36 $ 1,251,151 TRUST CLASS 76,470 $ 16.36 $ 1,251,151
----------- ----------------
$ 4,717,013 $ 4,717,013
2
<PAGE>
If the reorganization is approved, shareholders invested in the Equity
Assets - Guardian Assets, Equity Funds - Guardian Fund or Equity Trust -
Guardian Trust will become shareholders of the Asset Class, Fund
Class or Trust Class of Guardian Fund, respectively.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF AUGUST 31, 1999 PRO FORMA AS OF AUGUST 31, 1999 (UNAUDITED)
FUNDS INVESTING IN INTERNATIONAL PORTFOLIO INTERNATIONAL FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY FUNDS- INTERNATIONAL FUND 6,712 $ 16.76 $ 112,516 FUND CLASS 6,712 $ 16.76 $ 112,516
EQUITY TRUST- INTERNATIONAL TRUST 140 $ 16.92 $ 2,373 TRUST CLASS 140 $ 16.92 $ 2,373
----------- ----------------
$ 114,889 $ 114,889
If the reorganization is approved, shareholders invested in the
Equity Funds - International Fund or Equity Trust - International Trust
will become shareholders of the Fund Class or Trust Class
of International Fund, respectively.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF AUGUST 31, 1999 PRO FORMA AS OF AUGUST 31, 1999 (UNAUDITED)
FUNDS INVESTING IN MANHATTAN PORTFOLIO MANHATTAN FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY ASSETS- MANHATTAN ASSETS 118 $ 14.54 $ 1,717 ASSET CLASS 118 $ 14.54 $ 1,717
EQUITY FUNDS- MANHATTAN FUND 46,894 $ 12.07 $ 565,960 FUND CLASS 46,894 $ 12.07 $ 565,960
EQUITY TRUST- MANHATTAN TRUST 3,014 $ 15.02 $ 45,284 TRUST CLASS 3,014 $ 15.02 $ 45,284
----------- ----------------
$ 612,961 $ 612,961
3
<PAGE>
If the reorganization is approved, shareholders invested in the Equity Assets -
Manhattan Assets, Equity Funds - Manhattan Fund or Equity Trust - Manhattan
Trust will become shareholders of the Asset Class, Fund Class or
Trust Class of Manhattan Fund, respectively.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF FEBRUARY 29, 2000 PRO FORMA AS OF FEBRUARY 29, 2000 (UNAUDITED)
FUNDS INVESTING IN MILLENNIUM PORTFOLIO MILLENNIUM FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY ASSETS- MILLENNIUM ASSETS 5 $ 12.49 $ 66 ASSET CLASS 5 $ 12.49 $ 66
EQUITY FUNDS- MILLENNIUM FUND 7,932 $ 41.46 $ 328,902 FUND CLASS 7,932 $ 41.46 $ 328,902
EQUITY TRUST- MILLENNIUM TRUST 420 $ 39.28 $ 16,515 TRUST CLASS 420 $ 39.28 $ 16,515
----------- ----------------
$ 345,483 $ 345,483
If the reorganization is approved, shareholders invested in the Equity
Assets - Millennium Assets, Equity Funds - Millennium Fund or Equity Trust -
Millennium Trust will become shareholders of the Asset Class, Fund Class
or Trust Class of Millennium Fund, respectively.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF AUGUST 31, 1999 PRO FORMA AS OF AUGUST 31, 1999 (UNAUDITED)
FUNDS INVESTING IN PARTNERS PORTFOLIO PARTNERS FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY ASSETS- PARTNERS ASSETS 3,967 $ 15.74 $ 62,432 ASSET CLASS 3,967 $ 15.74 $ 62,432
EQUITY FUNDS- PARTNERS FUND 108,043 $ 26.42 $ 2,854,358 FUND CLASS 108,043 $ 26.42 $ 2,854,358
EQUITY TRUST- PARTNERS TRUST 45,432 $ 18.71 $ 850,108 TRUST CLASS 45,432 $ 18.71 $ 850,108
----------- ----------------
$ 3,766,898 $ 3,766,898
4
<PAGE>
If the reorganization is approved, shareholders invested in the Equity
Assets - Partners Assets, Equity Funds - Partners Fund or Equity Trust -
Partners Trust will become shareholders of the Asset Class, Fund
Class or Trust Class of Partners Fund, respectively.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF AUGUST 31, 1999 PRO FORMA AS OF AUGUST 31, 1999 (UNAUDITED)
FUNDS INVESTING IN REGENCY PORTFOLIO REGENCY FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY FUNDS- REGENCY FUND 809 $ 9.82 $ 7,943 FUND CLASS 809 $ 9.82 $ 7,943
EQUITY TRUST- REGENCY TRUST 37 $ 9.76 $ 357 TRUST CLASS 37 $ 9.76 $ 357
---------- ----------------
$ 8,300 $ 8,300
If the reorganization is approved, shareholders invested in the Equity Funds
- Regency Fund or Equity Trust - Regency Trust will become shareholders of
the Fund Class or Trust Class of Regency Fund, respectively.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF AUGUST 31, 1999 PRO FORMA AS OF AUGUST 31, 1999 (UNAUDITED)
FUNDS INVESTING IN SOCIALLY RESPONSIVE PORTFOLIO SOCIALLY RESPONSIVE FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY ASSETS- SOCIALLY
RESPONSIVE ASSETS 11 $ 9.85 $ 109 ASSET CLASS 11 $ 9.85 $ 109
EQUITY FUNDS- SOCIALLY
RESPONSIVE FUND 5,575 $ 21.33 $ 118,900 FUND CLASS 5,575 $ 21.33 $ 118,900
EQUITY TRUST- SOCIALLY
RESPONSIVE TRUST 1,755 $ 14.41 $ 25,295 TRUST CLASS 1,755 $ 14.41 $ 25,295
----------- ---------------
$ 144,304 $ 144,304
If the reorganization is approved, shareholders invested in the Equity Assets -
Socially Responsive Assets, Equity Funds - Socially Responsive Fund or Equity
Trust - Socially Responsive Trust will become shareholders of the Asset Class,
Fund Class or Trust Class of Socially Responsive Fund, respectively.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
EXISTING AS OF JUNE 30, 2000 PRO FORMA AS OF JUNE 30, 2000 (UNAUDITED)
FUNDS INVESTING IN TECHNOLOGY PORTFOLIO TECHNOLOGY FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C> <C>
EQUITY FUNDS- TECHNOLOGY FUND 1,509 $ 10.64 $ 16,051 FUND CLASS 1,509 $ 10.64 $ 16,051
EQUITY TRUST- TECHNOLOGY TRUST 200 $ 10.63 $ 2,128 TRUST CLASS 200 $ 10.63 $ 2,128
----------- -----------------
$ 18,179 $ 18,179
5
</TABLE>
<PAGE>
If the reorganization is approved, shareholders invested in the Equity Funds -
Technology Fund or Equity Trust - Technology Trust will become shareholders
of the Fund Class or Trust Class of Technology Fund, respectively.
Most of the following tables are as of October 31, 1999, the date of the latest
audited fiscal period, except for Institutional Cash. Because Institutional
Cash started operations after October 31, 1999 its capitalization
table is as of June 30, 2000.
<TABLE>
<CAPTION>
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF OCTOBER 31, 1999 PRO FORMA AS OF OCTOBER 31, 1999 (UNAUDITED)
FUNDS INVESTING IN CASH RESERVES PORTFOLIO CASH RESERVES
<S> <C> <C> <C> <C> <C> <C>
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
INCOME FUNDS- CASH RESERVES 1,104,191 $ 1.00 $ 1,104,165 FUND CLASS 1,104,191 $ 1.00 $ 1,104,165
If the reorganization is approved, shareholders invested in the Income Funds
- Cash Reserves will become shareholders of the Fund Class of Cash Reserves.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF OCTOBER 31, 1999 PRO FORMA AS OF OCTOBER 31, 1999 (UNAUDITED)
FUNDS INVESTING IN GOVERNMENT MONEY PORTFOLIO GOVERNMENT MONEY FUND
<S> <C> <C> <C> <C> <C> <C>
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
INCOME FUNDS- GOVERNMENT MONEY FUND 653,377 $ 1.00 $ 653,377 FUND CLASS 653,377 $ 1.00 $ 653,377
If the reorganization is approved, shareholders invested in the Income
Funds - Government Money Fund will become shareholders of the
Fund Class of Government Money Fund.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF OCTOBER 31, 1999 PRO FORMA AS OF OCTOBER 31, 1999 (UNAUDITED)
FUNDS INVESTING IN HIGH YIELD BOND PORTFOLIO HIGH YIELD BOND FUND
<S> <C> <C> <C> <C> <C> <C>
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
INCOME FUNDS- HIGH YIELD BOND FUND 2,744 $ 8.68 $ 23,806 FUND CLASS 2,744 $ 8.68 $ 23,806
If the reorganization is approved, shareholders invested in the
Income Funds - High Yield Bond Fund will become shareholders of the
Fund Class of High Yield Bond Fund.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
EXISTING AS OF JUNE 30, 2000 PRO FORMA AS OF JUNE 30, 2000 (UNAUDITED)
FUNDS INVESTING IN INSTITUTIONAL CASH PORTFOLIO INSTITUTIONAL CASH FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C>
INCOME TRUST- INSTITUTIONAL CASH
TRUST 325,133 $ 1.00 $ 325,133 TRUST CLASS 325,133 $ 1.00 $ 325,133
If the reorganization is approved, shareholders invested in the Income Trust
- Institutional Cash Trust will become shareholders of the Trust Class of
Institutional Cash Fund.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF OCTOBER 31, 1999 PRO FORMA AS OF OCTOBER 31, 1999 (UNAUDITED)
FUNDS INVESTING IN LIMITED MATURITY BOND PORTFOLIO LIMITED MATURITY BOND FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C>
INCOME FUNDS- LIMTIED MATURITY
BOND FUND 23,872 $ 9.51 $ 227,041 FUND CLASS 23,872 $ 9.51 $ 227,041
INCOME TRUST- LIMITED MATURITY
BOND TRUST 4,584 $ 9.06 $ 41,549 TRUST CLASS 4,584 $ 9.06 $ 41,549
------------ ----------------
$ 268,590 $ 268,590
1
<PAGE>
If the reorganization is approved, shareholders invested in the Income Funds
- Limited Maturity Bond Fund or Income Trust - Limited Maturity Bond Trust
will become shareholders of the Fund Class or Trust Class of Limited
Maturity Bond Fund, respectively.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF OCTOBER 31, 1999 PRO FORMA AS OF OCTOBER 31, 1999 (UNAUDITED)
FUNDS INVESTING IN MUNICIPAL MONEY PORTFOLIO MUNICIPAL MONEY FUND
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C>
INCOME FUNDS- MUNICIPAL MONEY FUND 293,846 $ 1.00 $ 293,774 FUND CLASS 293,846 $ 1.00 $ 293,774
If the reorganization is approved, shareholders invested in the Income Funds -
Municipal Money Fund will become shareholders of the Fund Class of
Municipal Money Fund.
CAPITALIZATION TABLE (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AS REPORTED AS OF OCTOBER 31, 1999 PRO FORMA AS OF OCTOBER 31, 1999 (UNAUDITED)
FUNDS INVESTING IN MUNICIPAL SECURITIES PORTFOLIO MUNICIPAL SECURITIES TRUST
SHARES NAV NET ASSETS SHARES NAV CLASS NET ASSETS
<S> <C> <C> <C> <C> <C> <C>
INCOME FUNDS- MUNICIPAL SECURITIES
TRUST 3,244 $ 10.78 $ 34,957 FUND CLASS 3,244 $ 10.78 $ 34,957
If the reorganization is approved, shareholders invested in the Income Funds
- Municipal Securities Trust will become shareholders of the Fund Class of
Municipal Securities Trust.
</TABLE>
<PAGE>
Purchases and Redemptions
-------------------------
As explained above, in the Reorganization, shareholders of the funds will
receive shares of classes of the new Portfolios. After the Reorganization,
shareholders of the funds will be able to purchase and redeem shares in the
Portfolios in substantially the same manner and subject to substantially the
same conditions as shares in the funds are presently purchased and redeemed.
This information is set forth in each fund's current prospectus and statement of
additional information. In the case of NB Technology Fund, NB Technology Trust,
NB International Fund and NB International Trust, each of which has a 2.00%
redemption fee on shares sold within 180 days of purchase, calculation of the
180-day holding period will not be affected by the Reorganization.
Dividends, Distributions and Taxes
----------------------------------
After the Reorganization, the Portfolios will declare and pay dividends and
calculate and make distributions of net capital gains, if any, in a manner
identical to that of the funds and set forth in the funds' current prospectuses
and statements of additional information. Because the accounting treatment of
unrealized capital gain is different in master-feeder funds than it is in
multiple-class funds, some shareholders may receive different taxable capital
gain distributions than they otherwise would have if the Reorganization were not
taking place. It is impossible to predict whether any of this gain will actually
be realized in the future, the amount of it, or the date on which it will be
realized (if at all). Accordingly, the effect on shareholders would be highly
speculative.
Like the funds, each of Equity Funds and Income Funds has elected to
qualify its respective Portfolios as a regulated investment company under
Subchapter M of the Internal Revenue Code of 1986, as amended, and intends that
each Portfolio will remain so qualified. After the Reorganization, each
Portfolio will be entitled to the same benefits and subject to the same tax
regulations as the funds immediately prior to the Reorganization.
Portfolio Transactions and Brokerage
------------------------------------
NBMI will execute the portfolio transactions and allocate the brokerage
business of the Portfolios of Equity Funds and Income Funds subject to the
policies established by the Boards of Trustees of Equity Funds and Income Funds,
which are substantially identical to those in effect with respect to the master
funds immediately prior to the Reorganization.
Shareholders' Rights
--------------------
The rights of shareholders of the Portfolios will be identical in all
material respects to those of shareholders of the funds, with a few exceptions.
As was the case before the Reorganization, shareholders of the Portfolios will
vote on a per Portfolio basis on those matters that affect only particular
Portfolios. In addition, on those matters affecting only a particular class,
only shareholders of that class will vote. On all other matters, shareholders of
Equity Funds will vote in the aggregate, and shareholders of Income Funds will
- 45 -
<PAGE>
likewise vote in the aggregate. Because the Reorganization will increase the
size of the Portfolios, the voting power of individual shareholders will be
diluted with respect to matters on which shareholders of Equity Funds and Income
Funds vote in the aggregate or vote on a per series basis rather than on an
individual class basis. However, the same "dilution" could occur through growth
in the size of your fund, which would bring in additional shareholders.
Furthermore, matters currently requiring a vote of master fund investors, such
as approval of changes in advisory fees, already require that each feeder fund
solicit the votes of its shareholders.
Risk Factors
------------
The Portfolios will have investment objectives, policies and restrictions
that are identical to those of the funds and the corresponding master funds,
except that (1) the Portfolios will invest their assets directly rather than
through the master funds, (2) the shareholders of Equity Funds and Income Funds
are currently being asked to approve a change in fundamental investment policies
regarding diversification identical to that contained in Proposal 2 of this
Combined Proxy Statement and Prospectus, and (3) the shareholders of Cash
Reserves and Government Money Fund are currently being asked to approve a change
in their investment policies as described in Proposals 6 and 7. In addition, the
Portfolios will be administered in every material respect in a substantially
identical manner to the funds. Consequently, the risks associated with investing
in the Portfolios will be virtually identical to those associated with investing
in the funds.
Further Information about the Portfolios and the Funds
------------------------------------------------------
Further information about the funds is contained in their current
prospectuses and statements of additional information, which are incorporated
into this Combined Proxy Statement and Prospectus by reference. If you are being
asked to vote on this Proposal 4, copy of Equity Funds' prospectus and Income
Funds' prospectus accompanies this document. Each of Equity Trust, Equity Assets
and Equity Series will also provide its most recent annual report to
shareholders with respect to the funds for the fiscal year ended August 31,
1999, and its semiannual report to shareholders for the six months ended
February 29, 2000, upon request. Income Trust will also provide its most recent
annual report to shareholders for the fiscal year ended October 31, 1999, and
its semiannual report to shareholders for the six months ended April 30, 2000,
upon request. These documents are available without charge by writing the
Neuberger Berman Funds at 605 Third Avenue, 2nd Floor, New York, New York
10158-0180, or calling at 800-877-9700.
The funds are subject to the information requirements of the Securities
Exchange Act of 1934 and the Investment Company Act of 1940, and are required by
those Acts to file reports, proxy statements and other information with the SEC.
Such reports, proxy statements and other information can be inspected and copied
at the Public Reference Room maintained by the SEC at 450 Fifth Street, N.W.,
Washington, D.C. They may also be viewed on the Internet at [WWW.SEC.GOV].
Copies of such materials can be obtained at prescribed rates from the Public
Reference Branch, Office of Consumer Affairs and Information Services of the
SEC, Washington D.C. 20549.
- 46 -
<PAGE>
APPROVAL OF THE BOARD OF TRUSTEES
At a Board meeting held on June 6, 2000, the Boards of Trustees of Equity
Funds, Equity Trust, Equity Assets, Equity Series, Income Funds and Income Trust
approved the Reorganization Plan and determined that the proposed Reorganization
was in the best interests of the shareholders of each series of the funds and
will not result in dilution of the financial interests of the shareholders of
any series of the funds. After considering the relevant factors, the Boards of
Trustees of the funds, including the Trustees who are not "interested persons"
of the funds, as that term is defined in the 1940 Act (the "Independent
Trustees"), voted to approve and voted to recommend that shareholders of each
fund approve the Reorganization Plan. In making this determination, the Boards
considered the following factors, among others:
1. the potential cash savings that may be achieved by reorganizing the
master-feeder structure into a single-level, multi-class structure through the
elimination of duplicate expenses;
2. the expected administrative benefits resulting from the simplified
structure;
3. the proposal from NBMI to manage each fund's assets for the same
investment management fee currently charged to the fund;
4. the tax-free nature of the reorganization;
5. the potential for greater investor interest in funds organized in the
more common and familiar multi-class structure;
6. the greater likelihood of asset growth that potentially may result from
a more familiar structure and the greater economies of scale that can be
achieved from such asset growth, including without limitation lower management
fees that can be reached at certain asset level breakpoints;
7. the terms and conditions of the Reorganization Plan; and
8. alternative options to the Reorganization.
In considering the Reorganization Plan and proposed Reorganization, the
Boards determined that the multi-class structure would eliminate the cost and
complexity of maintaining the master-feeder structure. There are certain
duplicate expenses associated with maintaining the master-feeder structure,
which requires maintaining separate investment companies for the master fund and
for each feeder fund. Among others, these include the legal and administrative
costs of maintaining separate SEC registrations for the master fund and each
feeder fund, and of producing separate reports to the SEC and to shareholders
for each feeder fund and each master fund on a semi-annual basis, state
qualification fees associated with these separate entities, franchise fees,
separate audit fees, and the other legal and administrative costs of maintaining
the separate entities. Of course, the Boards recognized that any net savings are
difficult to predict accurately.
- 47 -
<PAGE>
The Boards believe that the Reorganization may result in lower expense
ratios for the funds. This lower expense ratio has the potential to attract new
investors and thus increase the opportunity for further asset growth. This
potential asset growth may enable fund shareholders to obtain economies of scale
by spreading certain expenses over a larger asset base, and may assist a fund in
reaching its asset breakpoint in the rate of the investment management fee
payable to NBMI. There can be no assurance, however, that such asset growth,
economies of scale and lower expense ratios will be realized. The Board
recognized that any cost savings would accrue to the benefit of NBMI as well,
through its voluntary and contractual agreements with the funds to limit the
funds' total annual operating expenses.
The Boards also believe that the Reorganization may improve the
marketability of the funds, because investors apparently understand the
multi-class structure better than they do the master-feeder structure. The
Boards considered that any improved marketability would benefit both NBMI (by
virtue of certain fees determined as a percentage of net assets) and existing
shareholders (by virtue of economies of scale).
CLOSING DATE
If shareholders approve the Reorganization Plan with respect to a fund, it
is currently intended that the Reorganization of the Equity Funds will take
place at the close of business on or about December 15, 2000, and the
Reorganization of the Income Funds will take place at the close of business on
or about February 15, 2001. On or about the date for your fund, you will receive
a prospectus for Equity Funds and/or Income Funds, containing information about
the relevant class of shares.
The Board of Trustees of two combining funds by mutual agreement can
terminate the Reorganization of those funds at or before the closing date, even
if shareholders have approved the Reorganization. In addition, the
Reorganization of certain funds is contingent on the receipt of certain
regulatory assurances from the SEC. These funds have asked for such relief, but
there is no guarantee that the SEC will grant it.
REORGANIZATION EXPENSES
Each entity participating in the Reorganization (i.e., Equity Funds, Equity
Trust, Equity Assets, Equity Series, Income Funds, Income Trust and each of
their series) will bear its own expenses. The expenses borne by each Trust will
be allocated among its series on the basis of their relative net assets.
THE BOARDS OF TRUSTEES, INCLUDING ALL OF THE INDEPENDENT TRUSTEES,
UNANIMOUSLY RECOMMEND THAT YOU APPROVE THE AGREEMENT AND PLAN OF REORGANIZATION
IN PROPOSAL 4.
VOTE REQUIRED
Approval of the Reorganization Plan with respect to a fund requires the
affirmative vote of either (1) a majority of the outstanding shares of that
fund, or (2) at least 67 percent of the shares present in person or by proxy at
a meeting at which more than 50% of the shares are present.
If the shareholders of one or more funds do not approve the Reorganization
Plan, or the Reorganization is not completed for any other reason, then the
Board of Trustees of the relevant fund will determine what additional steps may
be appropriate. The Trust Instrument governing the funds permits the Board to
reorganize a fund into a series of another investment company if the Board
determines that continued operation of that series is no longer viable. If some
funds vote to reorganize and others do not, the Board may determine, based on
the facts as they then exist, that the remaining funds are no longer viable as
separate entities.
- 48 -
<PAGE>
PROPOSAL 5. APPROVAL OF THE DISTRIBUTION AND
SHAREHOLDER SERVICES PLAN
(NEUBERGER BERMAN GENESIS, GUARDIAN AND PARTNERS TRUST ONLY)
The Board of Trustees of Neuberger Berman Equity Trust has approved, and
unanimously recommends that the shareholders of Neuberger Berman Genesis Trust,
Neuberger Berman Guardian Trust and Neuberger Berman Partners Trust approve, the
Distribution and Shareholder Services Plan. The Trustees of Equity Trust,
including a majority of those Trustees who are not "interested persons" (as
defined in the Investment Company Act of 1940 ("1940 Act")) and who do not have
any direct or indirect financial interest in the operation of the Plan
("Independent Trustees"), approved the Distribution and Shareholder Services
Plan with respect to each fund's shares at a meeting held on April 28, 1999, and
determined at their meeting of June 6, 2000, to resubmit the Plan to
shareholders.
The Distribution and Shareholder Services Plan provides for the payment of
compensation for shareholder servicing activities, including but not limited to:
(a) responding to inquiries from shareholders or their representatives
requesting information regarding matters such as shareholder account or
transaction status, net asset value of shares, performance, services, plans and
options, investment policies, portfolio holdings, and distributions and taxation
thereof; and (b) dealing with communications and correspondence of shareholders;
including compensation to organizations and employees who service shareholder
accounts, and expenses of such organizations, including overhead, telephone, and
other communication expenses. (See Section 3.B. of the proposed Plan).
The Distribution and Shareholder Services Plan also permits payment of
compensation for distribution-related activities, including but not limited to
compensation for (a) the distribution of shares; (b) overhead, telephone, and
communication expenses; (c) the printing of prospectuses, statements of
additional information, and reports for other than existing shareholders; and
(d) the preparation and distribution of sales literature and advertising
materials. (See Section 3.A. of the proposed Plan)
NBMI currently provides distribution services to Genesis Trust, Guardian
Trust, and Partners Trust. Assuming approval of the Distribution and Shareholder
Services Plan by Genesis Trust, Guardian Trust and Partners Trust, each fund
would pay a new fee at an annual rate of 0.10% of its average daily net assets
to NBMI. NBMI expects to pay most or all of this fee to pension administrators,
broker-dealers and other financial institutions that make fund shares available
to investors and/or provide services to the funds and their shareholders. To the
extent NBMI does not pay the entire 0.10% to these entities, NBMI will retain
the remainder. The payment over a short interval may be more or less than NBMI
has expended for shareholder services and distribution during that interval.
Over the longer term, however, neither NBMI nor the Board expects the 0.10% fee
to cover NBMI's costs of shareholder servicing and distribution.
The funds would not be obligated under the Distribution and Shareholder
Services Plan to compensate NBMI for expenses incurred in excess of the
authorized distribution fee, even if, as expected, the expenses incurred by it
- 49 -
<PAGE>
for servicing or distributing the funds' shares exceed the fee payable under the
Plan. The fee paid to a financial institution may be based on the level of
services it provides. If NBMI does not have to pay the entire amount to
institutions, the remaining portion would represent compensation to NBMI for new
or existing distribution and shareholder servicing expenses.
The Distribution and Shareholder Services Plan provides that a report of
the amounts expended under it, and the purposes for which such expenditures were
incurred, must be made to the Trust's Board of Trustees for review at least
quarterly. In addition, the Plan provides that it may not be amended to
materially increase the costs that a fund may bear pursuant to it without
approval of the fund's shareholders. Other material amendments to the Plan must
be approved by the vote of a majority of the Trustees, including a majority of
the Independent Trustees, cast in person at a meeting called for the purpose of
considering such amendments. The Distribution and Shareholder Services Plan is
terminable with respect to a fund at any time by vote of a majority of the
Independent Trustees or by vote of the holders of a majority of the outstanding
shares of the fund. The Distribution and Shareholder Services Plan would be
adopted pursuant to Rule 12b-1 under the 1940 Act. In accordance with this Rule,
the selection and nomination of the Trustees who are not interested persons of
Equity Trust is committed to the discretion of the then current Trustees who are
not interested persons of Equity Trust. (All of the Neuberger Berman Funds
follow this nominating policy already.)
A comparison of the current expense ratio and the proposed expense ratio
(after giving effect to the Distribution and Shareholder Services Plan) with
respect to each fund is shown in the tables under "Impact of the Proposal"
below.
This description of the Distribution and Shareholder Services Plan is
qualified in its entirety by reference to the Plan itself, a form of which is
attached as Appendix B to this proxy statement. If approved by shareholders, the
Distribution and Shareholder Services Plan will become effective in December
2000 for one year, and will remain in effect from year to year thereafter,
subject to annual continuation by the Board of Trustees.
IMPACT OF THE PROPOSAL. If the Proposal is approved, each fund would incur
distribution fees at an annual rate of 0.10% of average daily net assets, in
addition to the fees and expenses currently applicable. Under its existing
administration and shareholder services agreement with NBMI, each fund currently
pays a fee at an annual rate of 0.40% of average daily net assets. Of this
amount, NBMI pays at least 0.25% to pension administrators, broker-dealers and
other financial institutions that provide services to the funds and their
shareholders, and retains the rest for administration and accounting services
provided by NBMI. The following tables compare the management fees, distribution
fees, other expenses, and total fund operating expenses that shareholders of
each fund would bear under the existing structure with the fees and expenses
each shareholder would bear if they approve the Distribution and Shareholder
Services Plan.
Each fund currently has an arrangement whereby NBMI reimburses certain of
the fund's expenses so that the fund's total annual operating expenses are not
more than 0.10% above those of a certain other Neuberger Berman fund that
invests in the same portfolio of securities ("Sister Fund"). If the Distribution
and Shareholder Services Plan is adopted, each fund's total annual operating
- 50 -
<PAGE>
expenses will be limited to no more than 0.20% above those of its Sister Fund.
These expense limitation arrangements can be terminated upon 60 days' notice to
a fund.
If shareholders approve both the Plan of Reorganization (Proposal 4) and
the implementation of the Distribution and Shareholder Services Plan, then
shareholders of each fund will be holders of the Trust Class shares that are
subject to the Distribution and Shareholder Services Plan. For example, if
Genesis Trust shareholders approve both Proposals, they will become holders of
Trust Class shares of Neuberger Berman Genesis Fund that are subject to the
Distribution and Shareholder Services Plan. If the funds do not approve Proposal
4, then each fund will continue to operate with a master-feeder structure (so
long as it is viable), and each fund that has approved the Distribution and
Services Plan will be subject to it.
- 51 -
<PAGE>
<TABLE>
<CAPTION>
NEUBERGER BERMAN GENESIS TRUST
CURRENT PROPOSED
------- --------
FEE TABLE FEE TABLE
<S> <C> <C> <C>
Shareholder fees None Shareholder fees None
Annual operating expenses (% of average net Annual operating expenses (% of average
assets)* net assets)*
These are deducted from fund assets, so you These are deducted from fund assets, so
pay them indirectly. you pay them indirectly.
Management fees 1.12 Management fees 1.12
Plus: Distribution (12b-1) fees None PLUS: DISTRIBUTION (12B-1) FEES
0.10
Other expenses 0.11 Other expenses 0.11
---------- --------
Equals: Total annual operating expenses 1.23 EQUALS: TOTAL ANNUAL OPERATING EXPENSES 1.33
* Neuberger Berman Management reimburses certain * Neuberger Berman Management reimburses
expenses of the fund so that its total annual certain expenses of the fund so that its
operating expenses are not more than 0.10% above total annual operating expenses are not more
those of another Neuberger Berman fund that invests than 0.20% above those of another Neuberger
in the same portfolio of securities. This arrangement Berman fund that invests in the same
does not cover interest, taxes, brokerage portfolio of securities. This arrangement
commissions, and extraordinary expenses. Under this does not cover interest, taxes, brokerage
arrangement, which NB Management can terminate upon commissions, and extraordinary expenses.
60 days' notice to the fund, total annual operating Under this arrangement, which NB Management
expenses of the fund last year would have been can terminate upon 60 days' notice to the
limited to 1.27% of the fund's average net assets. fund, total annual operating expenses of the
The figures in the table are based on last year's fund last year would have been limited to
expenses. Actual expenses this year may be higher or 1.37% of the fund's average net assets. The
lower. The table includes costs paid by the fund and figures in the table are based on last year's
its share of master portfolio costs. 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.
EXPENSE EXAMPLE EXPENSE EXAMPLE
This example assumes that you invested $10,000 for the This example assumes that you invested $10,000
periods shown, that you earned a hypothetical 5% total for periods shown, that you earned a
return each year, and that the fund's expenses were those hypothetical 5% total return each year, and
in the table above. Your costs would be the same whether that the fund's expenses were those in the
you sold your shares or continued to hold them at the end table above. Your costs would be the same
of each period. Actual performance and expenses may be whether you sold your shares or continued to
higher or lower. hold them at the end of each period. Actual
performance and expenses may be higher or
lower.
</TABLE>
<TABLE>
<CAPTION>
1 3 5 10 1 3 5 10
Year Years Years Years Year Years Years Years
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Expenses $125 $390 $676 $1489 Expenses $135 $421 $729 $1,601
</TABLE>
- 52 -
<PAGE>
NEUBERGER BERMAN GUARDIAN TRUST
<TABLE>
<CAPTION>
CURRENT PROPOSED
------- --------
FEE TABLE FEE TABLE
<S> <C> <C> <C>
Shareholder fees None Shareholder fees None
Annual operating expenses (% of average net Annual operating expenses (% of average
assets)* net assets)*
These are deducted from fund assets, so you These are deducted from fund assets, so
pay them indirectly. you pay them indirectly.
Management fees 0.84 Management fees 0.84
Plus: Distribution (12b-1) fees None PLUS: DISTRIBUTION (12B-1) FEES
0.10
Other expenses 0.04 Other expenses 0.04
---------- -------
Equals: Total annual operating expenses 0.88 EQUALS: TOTAL ANNUAL OPERATING EXPENSES 0.98
* Neuberger Berman Management reimburses certain * Neuberger Berman Management reimburses
expenses of the fund so that its total annual certain expenses of the fund so that its
operating expenses are not more than 0.10% above total annual operating expenses are not more
those of another Neuberger Berman fund that invests than 0.20% above those of another Neuberger
in the same portfolio of securities. This arrangement Berman fund that invests in the same
does not cover interest, taxes, brokerage portfolio of securities. This arrangement
commissions, and extraordinary expense. Under this does not cover interest, taxes, brokerage
arrangement, which NB Management can terminate upon commissions, and extraordinary expenses.
60 days' notice to the fund, total annual operating Under this arrangement, which NB Management
expenses of the fund last year would have been can terminate upon 60 days' notice to the
limited to .92% of the fund's average net assets. The fund, total annual operating expenses of the
figures in the table are based on last year's fund last year would have been limited to
expenses. Actual expenses this year may be higher or 1.02% of the fund's average net assets. The
lower. The table includes costs paid by the fund and figures in the table are based on last year's
its share of master portfolio costs. 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.
EXPENSE EXAMPLE EXPENSE EXAMPLE
This example assumes that you invested $10,000 for the This example assumes that you invested $10,000
periods shown, that you earned a hypothetical 5% total for periods shown, that you earned a
return each year, and that the fund's expenses were those hypothetical 5% total return each year, and
in the table above. Your costs would be the same whether that the fund's expenses were those in the
you sold your shares or continued to hold them at the end table above. Your costs would be the same
of each period. Actual performance and expenses may be whether you sold your shares or continued to
higher or lower. hold them at the end of each period. Actual
performance and expenses may be higher or
lower.
</TABLE>
<TABLE>
<CAPTION>
1 3 5 10 1 3 5 10
Year Years Years Years Year Years Years Years
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Expenses $90 $281 $488 $1084 Expenses $100 $312 $542 $1,201
</TABLE>
- 53 -
<PAGE>
NEUBERGER BERMAN PARTNERS TRUST
<TABLE>
<CAPTION>
CURRENT PROPOSED
------- --------
FEE TABLE FEE TABLE
<S> <C> <C> <C>
Shareholder fees None Shareholder fees None
Annual operating expenses (% of average net Annual operating expenses (% of average net
assets)* assets)*
These are deducted from fund assets, so you These are deducted from fund assets, so you
pay them indirectly. pay them indirectly.
Management fees 0.85 Management fees 0.85
Plus: Distribution (12b-1) fees None PLUS: DISTRIBUTION (12B-1) FEES
0.10
Other expenses 0.06 Other expenses 0.06
--------- -------
Equals: Total annual operating expenses 0.91 EQUALS: TOTAL ANNUAL OPERATING EXPENSES 1.01
* Neuberger Berman Management reimburses certain * Neuberger Berman Management reimburses
expenses of the fund so that its total annual certain expenses of the fund so that its
operating expenses are not more than 0.10% above total annual operating expenses are not more
those of another Neuberger Berman fund that invests than 0.20% above those of another Neuberger
in the same portfolio of securities. This arrangement Berman fund that invests in the same
does not cover interest, taxes, brokerage portfolio of securities. This arrangement
commissions, and extraordinary expenses. Under this does not cover interest, taxes, brokerage
arrangement, which NB Management can terminate upon commissions, and extraordinary expenses.
60 days' notice to the fund, total annual operating Under this arrangement, which NB Management
expenses of the fund last year would have been can terminate upon 60 days' notice to the
limited to .92% of the fund's average net assets. The fund, total annual operating expenses of the
figures in the table are based on last year's fund last year would have been limited to
expenses. Actual expenses this year may be higher or 1.02% of the fund's average net assets. The
lower. The table includes costs paid by the fund and figures in the table are based on last year's
its share of master portfolio costs. 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.
EXPENSE EXAMPLE EXPENSE EXAMPLE
This example assumes that you invested $10,000 for the This example assumes that you invested $10,000
periods shown, that you earned a hypothetical 5% total for periods shown, that you earned a
return each year, and that the fund's expenses were those hypothetical 5% total return each year, and
in the table above. Your costs would be the same whether that the fund's expenses were those in the
you sold your shares or continued to hold them at the end table above. Your costs would be the same
of each period. Actual performance and expenses may be whether you sold your shares or continued to
higher or lower. hold them at the end of each period. Actual
performance and expenses may be higher or
lower.
</TABLE>
<TABLE>
<CAPTION>
1 3 5 10 1 3 5 10
Year Years Years Years Year Years Years Years
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Expenses $93 $290 $504 $1120 Expenses $103 $322 $558 $1236
</TABLE>
- 54 -
<PAGE>
REASONS FOR THE PROPOSAL. NBMI has recommended Proposal 5 to the Board of
Trustees in light of the expenses associated with providing shareholder
servicing and distribution services to the funds. NBMI believes that the
distribution and shareholder servicing fee proposed for the funds is appropriate
to defray a portion of the costs associated with shareholder servicing
activities and to support the marketing of the funds.
NBMI believes that the compensation practices that prevail among the
entities that make the funds available to investors justify adopting the
Distribution and Shareholder Services Plan. The funds rely exclusively on
third-party service providers such as pension plan administrators, fund
"supermarkets," banks and broker-dealers to make fund shares available to
investors. These third-party service providers generally hold shares in omnibus
accounts and provide shareholder services, including sub-accounting, shareholder
assistance, transaction processing and settlements, shareholder account
statement preparation and distribution, confirmation preparation and
distribution, payment of fund distributions, prospectus delivery, and
account-level tax reporting. Many of these third-party service providers have
asked the funds for additional fees to cover their increasing costs, including
those resulting from the increased use of sophisticated technology to support
shareholder servicing. As a result, the funds face increasing costs and must pay
these fees to maintain an effective servicing program that meets shareholders'
expectations for a high level of service and up-to-date technology.
NBMI believes that adopting the Distribution and Shareholder Services Plan
is a prudent alternative to raising the fees under the funds' existing
administration agreement. SEC rules prohibit a fund from paying for activities
"primarily intended to result in the sale of shares" except pursuant to a plan
adopted under the rules. While it is not clear that the services rendered by the
funds' third-party service providers fall within the legal definition of
activities "primarily intended to result in the sale of shares," recent SEC
pronouncements raise a question, at least in the case of payments to fund
supermarkets, whether a portion of the payments to the third-party service
providers may be characterized as payments for share distribution. If the Plan
is adopted, the fees paid would be available for distribution-related expenses
as well as shareholder servicing.
Many of the funds' competitors have distribution plans, which they use to
compensate third-party service providers for making fund shares available to
their clients and/or for providing services to investors. NBMI believes it will
be difficult to maintain a relationship with these third-party service providers
unless they are provided with additional compensation to offset the increased
costs of making the funds available to their clients and maintaining the
clients' assets in the funds. Certain third-party service providers that are
registered broker-dealers may use money provided under the Distribution and
Shareholder Services Plan to pay individual sales representatives.
NBMI believes that the fees under the Distribution and Shareholder Services
Plan will help the funds maintain an effective program to make their shares
available to investors, which is necessary for the funds to maintain a
sufficient size to spread their fixed costs over a substantial asset base.
- 55 -
<PAGE>
CONSIDERATION AND APPROVAL BY THE BOARD OF TRUSTEES. Before approving the
Distribution and Shareholder Services Plan, the funds' Trustees were provided
with detailed information relating to it. They considered carefully the factors
described above and consulted with independent counsel.
The Trustees of Equity Trust considered, among other factors: (a) the
circumstances that would make adoption of the Distribution and Shareholder
Services Plan appropriate and the causes of such circumstances; (b) the way in
which the Distribution and Shareholder Services Plan would address these
circumstances; and (c) the amounts of the expenses under the Distribution and
Shareholder Services Plan in relation to the overall cost structure of the
funds.
Taking the above factors into account, the Board of Trustees determined
that approval of the Distribution and Shareholder Services Plan was appropriate
for three principal reasons.
First, because the third-party service providers who require increased fees
are some of the funds' largest holders, the Trustees believe the funds must meet
the demand for higher fees to maintain the funds' viability. The Trustees
believe that maintenance of strong shareholder servicing and marketing efforts
are of critical importance in the highly competitive mutual fund industry. To
remain competitive, the funds need to meet the demands of changing technology
and of rising shareholder service expectations. In light of recent SEC
pronouncements, the Trustees believe that adopting the Distribution and
Shareholder Services Plan is a prudent way to secure resources for third-party
service provider needs, because the Plan would allow resources to be spent for
both distribution and shareholder servicing activities.
Second, the Board determined that the servicing and/or distribution fees
under the Distribution and Shareholder Services Plan would be attractive to fund
supermarkets and others that make the funds' shares available, resulting in
greater growth of the funds or maintenance of fund assets at higher levels than
might otherwise be the case. The Trustees recognized that if the funds
experience growth as a result of increased shareholder subscriptions (sales of
new shares), they will have greater access to cash for new purchases of
securities, thereby making the funds easier to manage and maintaining their
viability. The Trustees also recognized that an increase in each fund's asset
size may result in certain economies of scale. These economies of scale would be
shared by investors in the funds, both because fixed expenses would be spread
over a larger asset base and because the management fees that the funds pay
under their management contracts include breakpoints of declining percentages
based on greater asset size.
Third, the Trustees gave particular attention to the fact that to the
extent the increase is not offset by economies of scale, the net result of the
Distribution and Shareholder Services Plan will be to increase the operating
expenses of each fund and, therefore, its expense ratio. The Trustees weighed
this increase in expenses in their deliberations and determined that the
payments under the Plan are reasonable, because the amount of the fee is closely
tied to the actual or projected increases in the fees charged by many service
providers.
The Trustees also considered the extent to which the retention of assets
and additional sales of fund shares would be likely to increase the amount of
compensation paid by the funds to NBMI, because such fees are calculated as a
percentage of each fund's assets and thus will increase if net assets increase.
- 56 -
<PAGE>
The Trustees further recognized that there can be no assurance that any of the
potential benefits described above will be achieved if the Distribution and
Shareholder Services Plan is implemented.
Following their consideration, the Trustees, including all of the
Independent Trustees, concluded that the fees payable under the Distribution and
Shareholder Services Plan were reasonable in view of both the services to be
provided, directly or indirectly, by NBMI and others, and the anticipated
benefits of the Distribution and Shareholder Services Plan. The Trustees,
including all of the Independent Trustees, determined that implementing the
Distribution and Shareholder Services Plan would have a reasonable likelihood of
benefiting each fund and its shareholders and would be in the best interests of
each fund and its shareholders.
Accordingly, the Trustees, including all of the Independent Trustees, voted
to approve the Distribution and Shareholder Services Plan, as set forth above,
and to recommend that each fund's shareholders vote FOR the Proposal.
REQUIRED VOTE
Approval of Proposal 5 with respect to each fund requires the affirmative
vote of a "majority of the outstanding voting securities" of that fund, which
for this purpose means the affirmative vote of the lesser of (1) more than 50%
of the outstanding shares of the fund or (2) 67% or more of the shares of the
fund present at the Meeting if more than 50% of the outstanding shares of the
fund are represented at the Meeting in person or by proxy.
The Distribution and Shareholder Services Plan will become effective with
respect to a fund whose shareholders approve it as described above, even if
shareholders of the other funds do not approve the Plan.
THE BOARD OF TRUSTEES, INCLUDING ALL OF THE INDEPENDENT TRUSTEES,
UNANIMOUSLY RECOMMENDS THAT YOU APPROVE THE DISTRIBUTION AND SHAREHOLDER
SERVICES PLAN IN PROPOSAL 5.
PROPOSAL 6. MODIFICATION OF FUNDAMENTAL RESTRICTION ON
INDUSTRY CONCENTRATION (SHAREHOLDERS OF CASH RESERVES ONLY)
The Board of Trustees of Income Funds is proposing a change to a
fundamental investment restriction of Neuberger Berman Cash Reserves. The
proposed change would require Cash Reserves normally to invest at least 25% of
its assets in the financial services group of industries. The law requires that
a change to any investment policy that a fund deems "fundamental" must be
approved by shareholders. Accordingly, the Board is asking you to consider this
change.
Cash Reserves' current policy prohibits the fund from "concentrating" (that
is, investing 25% or more of its assets) in securities of issuers having their
principal business activities in the same industry or group of industries. This
restriction does not apply to (1) securities issued or guaranteed by the U.S.
Government, its agencies or instrumentalities; and (2) investments in CDs or
bankers' acceptances issued by domestic branches of U.S. banks. As mentioned
above, the proposed change would require Cash Reserves normally to invest at
- 57 -
<PAGE>
least 25% of its assets in the financial services group of industries.
Obligations of issuers in the financial services industries include, but are not
limited to, those of domestic and foreign banks, savings institutions, consumer
and industrial finance companies, issuers of asset-backed securities, securities
brokerage companies and a variety of firms in the insurance field. The
flexibility the fund previously had to concentrate or not concentrate in certain
obligations of domestic banks would be deleted as no longer necessary.
The Board believes changing this fundamental restriction would provide the
fund with greater flexibility for future contingencies. The fund's investment
manager believes that this change is desirable because an increasing number of
instruments suitable for investment by money market funds are either issued or
guaranteed by companies in the financial services industries. In addition, this
change would conform the industry concentration policy of Cash Reserves to that
of another money market fund in the Neuberger Berman fund family.
Because Cash Reserves, under the new policy, would normally concentrate
more than 25% of its total assets in the financial services industries, it will
have greater exposure to the risks associated with those industries, such as
adverse interest rate trends, increased credit defaults, potentially burdensome
government regulation, the availability and cost of capital funds, and a decline
in general economic conditions. Also, with financial services reform
legislation, there is likely to be consolidation among entities in these
industries, resulting in increased competitive pressures. The bank instruments
in which Cash Reserves invests typically are not covered by deposit insurance.
As amended by the language in bold, the limitation would read as follows:
INDUSTRY CONCENTRATION. The Fund may not purchase any security if, as
a result, 25% or more of its total assets (taken at current value)
would be invested in the securities of issuers having their principal
business activities in the same industry, EXCEPT THAT THE FUND
NORMALLY WILL INVEST MORE THAN 25% OF ITS TOTAL ASSETS IN THE
OBLIGATIONS OF ISSUERS HAVING THEIR PRINCIPAL BUSINESS ACTIVITIES IN
THE FINANCIAL SERVICES INDUSTRIES OR REPURCHASE AGREEMENTS ON SUCH
OBLIGATIONS. This limitation does not apply to purchases of securities
issued or guaranteed by the U.S. Government or its agencies or
instrumentalities.
REQUIRED VOTE
Approval of Proposal 6 requires the affirmative vote of a "majority of the
outstanding voting securities" of the fund, which for this purpose means the
affirmative vote of the lesser of (1) more than 50% of the outstanding shares of
the fund or (2) 67% or more of the shares of the fund present at the Meeting if
more than 50% of the outstanding shares of the fund are represented at the
Meeting in person or by proxy.
If Proposal 4 for conversion to a multi-class system is not approved, but
Proposal 6 is approved, such approval would be deemed a change of policy for the
fund, plus authority for the fund to cast its vote in favor of an identical
change to policies of the master fund in which it invests.
- 58 -
<PAGE>
If the change contemplated by Proposal 6 is not approved by shareholders of
the fund, the existing fundamental restriction of the fund will continue in
effect.
THE BOARD OF TRUSTEES, INCLUDING ALL OF THE INDEPENDENT TRUSTEES,
UNANIMOUSLY RECOMMENDS THAT YOU APPROVE THE MODIFICATION OF THE FUNDAMENTAL
RESTRICTION ON INDUSTRY CONCENTRATION IN PROPOSAL 6.
PROPOSAL 7. MODIFICATION OF FUNDAMENTAL RESTRICTIONS OF
NEUBERGER BERMAN GOVERNMENT MONEY FUND
(SHAREHOLDERS OF GOVERNMENT MONEY FUND ONLY)
The Board of Trustees of Income Funds has approved several changes to the
fundamental investment limitations of Neuberger Berman Government Money Fund.
The law requires that a change to any investment policy that a fund deems
"fundamental" must be approved by shareholders. Accordingly, the Board is asking
you to consider these changes.
The Board believes the proposed changes would provide the fund with greater
investment flexibility, while at the same time preserving the fund's objective
of maximum safety and liquidity with the highest available current income. The
Board believes that conforming the fund's fundamental restrictions to other
similar Neuberger Berman funds will enhance management's ability to manage the
fund's assets efficiently and effectively in changing regulatory and investment
environments.
A. MODIFYING THE FUNDAMENTAL RESTRICTION LIMITING GOVERNMENT MONEY FUND TO
SECURITIES BACKED BY THE FULL FAITH AND CREDIT OF THE U.S. GOVERNMENT
As a fundamental policy, Government Money Fund currently may not invest in
any security that is not backed by the full faith and credit of the U.S.
Government. The proposed change to this policy would allow the fund to invest in
all securities issued or guaranteed as to principal or interest by the U.S.
Government, its agencies or instrumentalities.
U.S. Government agencies and instrumentalities issue many securities that
are not backed by the full faith and credit of the U.S. Government, but are
backed by the issuing agency or instrumentality. Some of these are backed by the
right of the issuing entity to borrow from the U.S. Treasury, others by the
discretionary authority of the Treasury to loan money, and still others only by
the creditworthiness of the issuing entity.
Investment in this broader array of U.S. Government securities offers the
potential for greater income, but carries with it a greater degree of risk. The
market prices of U.S. Government securities are not guaranteed by the government
and generally fluctuate inversely with changing interest rates. However, the
investment manager believes that, as the federal debt continues to shrink, the
fund should have greater flexibility to access this broader array of government
securities. The investment manager will continue to evaluate each security
- 59 -
<PAGE>
purchased for the fund and, in accordance with SEC rules governing money market
funds, must determine that it presents a minimal credit risk to the fund.
B. REMOVING THE FUNDAMENTAL PROHIBITION ON REPURCHASE AGREEMENTS
As a fundamental policy, Government Money Fund may not invest in repurchase
agreements. The proposed change would allow the fund to invest in repurchase
agreements collateralized by the same types of securities in which it can invest
(although the securities used as collateral may have a longer maturity than the
securities in which the fund normally invests).
The proposed change would allow the fund to use repurchase agreements in an
effort to earn more income. In a repurchase agreement, the fund would purchase
securities from a bank that is a member of the Federal Reserve System or from a
securities dealer that agrees to repurchase the securities from the fund at a
higher price on a designated future date, usually less than a week from the
purchase date. The difference between the purchase and sale prices is keyed to
current interest rates, and repurchase agreements are treated under the
securities laws as a form of lending. These agreements allow a fund to make
profitable use of cash amounts that are either too small to invest otherwise or
have come into the fund too late in the day to invest directly in government
securities, or to get the latest (and therefore highest) rates when rates are
rising.
While costs, delays, or losses could result if the selling party to a
repurchase agreement becomes bankrupt or otherwise defaults, repurchase
agreements are generally considered to be a very secure form of lending. When a
repurchase agreement is properly collateralized by government securities, the
SEC permits money market funds, such as the Government Money Fund, to treat them
as investments in government securities, rather than as investments in the bank
or broker-dealer that is acting as counter-party.
C. MODIFYING THE BORROWING POLICY TO PERMIT REVERSE REPURCHASE AGREEMENTS
Currently, the fundamental borrowing policy of the Government Money Fund
permits borrowing only from banks and only for temporary or emergency purposes.
The proposed change would amend this policy to read as follows:
The Fund may not borrow money, except that the Fund may (i) borrow
money from banks for temporary or emergency purposes and not for
leveraging or investment, AND (II) ENTER INTO REVERSE REPURCHASE
AGREEMENTS FOR ANY purpose; provided that (i) and (ii) in combination
do not exceed 33-1/3% of the value of its total assets (including the
amount borrowed) less liabilities (other than borrowings). IN ADDITION
TO THE FOREGOING, THE FUND MAY BORROW FROM ANY PERSON FOR TEMPORARY
PURPOSES IN AN AMOUNT NOT EXCEEDING 5% OF THE FUND'S TOTAL ASSETS AT
THE TIME THE LOAN IS MADE.
The principal purpose of the proposed change is to permit the fund to use
reverse repurchase agreements. Reverse repurchase agreements are a form of
borrowing very common among institutional investors such as mutual funds. In a
reverse repurchase agreement, the fund would sell portfolio securities subject
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to an agreement to repurchase the securities at a later date and for a fixed
price. The difference between the purchase and sale prices generally reflects a
market rate of interest.
The investment manager for Government Money Fund may want to use reverse
repurchase agreements to borrow money for investment purposes, as a means of
earning additional income. Reverse repurchase agreements may be viewed as a form
of leverage. Leverage creates an opportunity for increased total return but, at
the same time, carries certain risks. For example, leverage will tend to amplify
changes in the fund's net asset value. In addition, leverage from borrowing
creates interest expenses for the fund. To the extent the income derived from
securities purchased with borrowed funds exceeds the interest the fund will have
to pay, the fund's total return will be greater than it would be if leverage
were not used. Conversely, if the income from the assets obtained with borrowed
funds is not sufficient to cover the cost of leveraging, the net income of the
fund will be less than it would be if leverage were not used, and therefore the
amount available for distribution to the fund's shareholders as dividends will
be reduced. There is also a risk that the counter-party to a reverse repurchase
agreement will be unable or unwilling to complete the transaction as scheduled,
which may result in losses to the fund.
As a non-fundamental policy, the fund will not enter into reverse
repurchase agreements if securities lending transactions and reverse repurchase
agreements would exceed, in the aggregate, 33-1/3% of its total assets.
Additionally, it is the investment manager's current intention not to use the
proceeds of reverse repurchase agreements to invest in any securities with
maturities beyond the end of the term of the reverse repurchase agreement. This
practice is a way of limiting the risk of leverage.
D. MODIFYING THE FUNDAMENTAL RESTRICTION TO PERMIT SECURITIES LENDING
Currently, the fund is prohibited from making loans of its portfolio
securities. The proposed change would amend the existing fundamental restriction
on lending to read as follows:
LENDING. The Fund may not lend any security or make any other loan if,
as a result, more than 33-1/3% of its total assets (taken at current
value) would be lent to other parties, provided, however, that in
accordance with its investment objective, policies, and limitations,
the Fund can (i) purchase debt securities and (ii) engage in
repurchase agreements.
The proposed change would provide the fund with another means of earning
income through the lending of its portfolio securities. In recent years, this
practice has become more widespread among mutual funds, including money market
funds.
Any loan of portfolio securities would be subject to certain special
limitations and requirements established by the SEC staff to minimize the risk
to registered investment companies. These special requirements provide that
borrowers must continuously secure their obligations to return securities on
loan from the fund by depositing collateral in a form determined by the fund's
Trustees to be satisfactory. The collateral, which must be marked to market
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daily, must be equal to at least 100% of the market value of the loaned
securities, which will also be marked to market daily. As a non-fundamental
policy, the fund will not lend securities if securities lending transactions and
reverse repurchase agreements would exceed, in the aggregate, 33-1/3% of its
total assets. There is a risk that a borrower will be unable or unwilling to
return borrowed securities when asked, which could result in delays and losses
to the fund.
REQUIRED VOTE
SHAREHOLDERS OF NEUBERGER BERMAN GOVERNMENT MONEY FUND MUST VOTE ON EACH OF
THE CHANGES DESCRIBED IN ITEMS A-D OF PROPOSAL 7. Approval of each of the
changes contemplated by Proposal 7 requires the affirmative vote of a "majority
of the outstanding voting securities" of the fund, which for this purpose means
the affirmative vote of the lesser of (1) more than 50% of the outstanding
shares of the fund or (2) 67% or more of the shares of the fund present at the
Meeting if more than 50% of the outstanding shares of the fund are represented
at the Meeting in person or by proxy.
If Proposal 4 for conversion to a multi-class system is not approved, but
Proposal 7 regarding fundamental restrictions and policies is approved, such
approval would be deemed a change of policy for the fund, plus authority for
that fund to cast its vote in favor of an identical change to policies of the
master fund in which it invests.
IF SHAREHOLDERS DO NOT APPROVE ONE OR MORE OF THE CHANGES DESCRIBED IN
ITEMS A - D OF PROPOSAL 7, THEN THE FUND'S EXISTING POLICY WILL REMAIN IN EFFECT
AS TO THAT PARTICULAR ITEM. EACH SEPARATE CHANGE DESCRIBED IN ITEMS A -D THAT IS
APPROVED BY SHAREHOLDERS WILL BECOME EFFECTIVE WITH RESPECT TO THE FUND, EVEN IF
OTHER CHANGES ARE NOT APPROVED.
THE BOARD OF TRUSTEES, INCLUDING ALL OF THE INDEPENDENT TRUSTEES,
UNANIMOUSLY RECOMMENDS THAT YOU APPROVE ITEMS A - D OF PROPOSAL 7.
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OTHER INFORMATION
INFORMATION ABOUT NBMI. NBMI, located at 605 Third Avenue, New York, New
York 10158, serves as the funds' principal underwriter and administrator and as
investment manager to the master funds. NBMI manages the master funds in
conjunction with Neuberger Berman, LLC, as sub-adviser. Together, the firms
manage more than $54.4 billion in total assets (as of June 30, 2000) and
continue an asset management history that began in 1939.
OTHER MATTERS TO COME BEFORE THE MEETING. The Trustees do not intend to
present any other business at the Meeting, nor are they aware that any
shareholder intends to do so. If, however, any other matters are properly
brought before the Meeting, the persons named in the accompanying proxy card(s)
will vote on those matters in accordance with their judgment.
SHAREHOLDER PROPOSALS. The Trusts do not hold annual shareholder meetings.
Shareholders wishing to submit proposals for consideration for inclusion in a
proxy statement for a subsequent shareholder meeting should send their written
proposals to the Trust at 605 Third Avenue, New York, New York 10158, such that
they will be received by the Trust a reasonable period of time prior to any such
meeting.
NOTICE TO BANKS, BROKER-DEALERS AND VOTING TRUSTEES AND THEIR NOMINEES.
Please advise the Trusts at 605 Third Avenue, New York, New York 10158, whether
other persons are beneficial owners of fund shares for which proxies are being
solicited and, if so, the number of copies of this proxy statement needed to
supply copies to the beneficial owners of the respective shares.
By Order of the Board of Trustees
--------------------------------------
Claudia A. Brandon
Secretary
Neuberger Berman Equity Funds
Neuberger Berman Equity Trust
Neuberger Berman Equity Assets
Neuberger Berman Equity Series
Neuberger Berman Income Funds
Neuberger Berman Income Trust
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APPENDIX A
FORM OF
AGREEMENT AND PLAN OF REORGANIZATION AND TERMINATION
THIS AGREEMENT AND PLAN OF REORGANIZATION AND TERMINATION ("Agreement") is
made as of ________, 2000, between Neuberger Berman Equity Funds ("Equity
Funds"), on behalf of each segregated portfolio of assets ("series") thereof
listed on Schedule A to this Agreement ("Schedule A") (each, an "Acquiring
Fund"), and Neuberger Berman Equity Trust ("Equity Trust"), on behalf of each
series thereof listed on Schedule A (each, a "Target"). (Each Acquiring Fund and
Target is sometimes referred to herein individually as a "Fund" and collectively
as the "Funds"; and Equity Funds and Equity Trust are sometimes referred to
herein individually as an "Investment Company" and collectively as the
"Investment Companies.") All agreements, representations, actions, and
obligations described herein made or to be taken or undertaken by a Fund are
made and shall be taken or undertaken by Equity Funds on behalf of each
Acquiring Fund and by Equity Trust on behalf of each Target.
The Investment Companies, each of which is a Delaware business trust, wish
to effect eleven separate reorganizations, each described in section 368(a)(1)
of the Internal Revenue Code of 1986, as amended ("Code"), and intend this
Agreement to be, and adopt it as, a "plan of reorganization" within the meaning
of the regulations under section 368 of the Code ("Regulations"). Each
reorganization will involve the transfer of a Target's assets to the Acquiring
Fund listed on Schedule A opposite its name (each, a "corresponding Acquiring
Fund") in exchange solely for voting shares of beneficial interest in that
Acquiring Fund and that Acquiring Fund's assumption of that Target's
liabilities, followed by the constructive distribution of those shares PRO RATA
to the holders of shares of beneficial interest in that Target in exchange
therefor, all on the terms and conditions set forth herein. (All such
transactions involving each Target and its corresponding Acquiring Fund are
referred to herein as a "Reorganization.") For convenience, the balance of this
Agreement will refer only to a single Reorganization, one Target, and one
Acquiring Fund, but the terms and conditions hereof shall apply separately to
each Reorganization. The consummation of one Reorganization shall not be
contingent on the consummation of any other Reorganization.
Each Target has a single class of shares ("Target Shares"). Acquiring
Fund's shares are divided into multiple classes, including Trust Class shares.
Only Acquiring Fund's Trust Class shares ("Acquiring Fund Shares"), which are
substantially similar to the Target Shares, are involved in the Reorganization.
In consideration of the mutual promises contained herein, the parties agree
as follows:
1. PLAN OF REORGANIZATION AND TERMINATION
--------------------------------------
1.1. Target agrees to assign, sell, convey, transfer, and deliver all of
its assets described in paragraph 1.2 ("Assets") to Acquiring Fund. Acquiring
Fund agrees in exchange therefor --
(a) to issue and deliver to Target the number of full and fractional
(rounded to the third decimal place) Acquiring Fund Shares determined by
dividing the net value of Target (computed as set forth in paragraph
2.1) by the net asset value ("NAV") of an Acquiring Fund Share (computed
as set forth in paragraph 2.2), and
(b) to assume all of Target's liabilities described in paragraph 1.3
("Liabilities"). These transactions shall take place at the Closing (as
defined in paragraph 3.1).
<PAGE>
1.2. The Assets shall include all cash, cash equivalents, securities,
receivables (including interest and dividends receivable), claims and rights of
action, rights to register shares under applicable securities laws, books and
records, deferred and prepaid expenses shown as assets on Target's books, and
other property owned by Target at the Effective Time (as defined in paragraph
3.1).
1.3. The Liabilities shall include all of Target's liabilities, debts,
obligations, and duties of whatever kind or nature, whether absolute, accrued,
contingent, or otherwise, whether or not arising in the ordinary course of
business, whether or not determinable at the Effective Time, and whether or not
specifically referred to in this Agreement. Notwithstanding the foregoing,
Target agrees to use its best efforts to discharge all its known Liabilities
before the Effective Time.
1.4. At or immediately before the Effective Time, Target shall declare and
pay to its shareholders a dividend and/or other distribution in an amount large
enough so that it will have distributed substantially all (and in any event not
less than 90%) of its investment company taxable income (computed without regard
to any deduction for dividends paid) and substantially all of its realized net
capital gain, if any, for the current taxable year through the Effective Time.
1.5. At the Effective Time (or as soon thereafter as is reasonably
practicable), Target shall distribute the Acquiring Fund Shares received by it
pursuant to paragraph 1.1 to Target's shareholders of record, determined as of
the Effective Time (each a "Shareholder" and collectively "Shareholders"), in
constructive exchange for their Target Shares. That distribution shall be
accomplished by Equity Fund's transfer agent's opening accounts on Acquiring
Fund's share transfer books in the Shareholders' names and transferring those
Acquiring Fund Shares thereto. Each Shareholder's account shall be credited with
the respective PRO RATA number of full and fractional (rounded to the third
decimal place) Acquiring Fund Shares due that Shareholder. All outstanding
Target Shares , including any represented by certificates, shall simultaneously
be canceled on Target's share transfer books. Acquiring Fund shall not issue
certificates representing the Acquiring Fund Shares issued in connection with
the Reorganization.
1.6. As soon as reasonably practicable after distribution of the Acquiring
Fund Shares pursuant to paragraph 1.5, but in all events within six months after
the Effective Time, Target shall be terminated as a series of Equity Trust and
any further actions shall be taken in connection therewith as required by
applicable law.
1.7. Any reporting responsibility of Target to a public authority is and
shall remain its responsibility up to and including the date on which it is
terminated.
1.8. Any transfer taxes payable on issuance of Acquiring Fund Shares in a
name other than that of the registered holder on Target's books of the Target
Shares constructively exchanged therefor shall be paid by the person to whom
those Acquiring Fund Shares are to be issued, as a condition of that transfer.
2. VALUATION
---------
2.1. For purposes of paragraph 1.1(a), Target's net value shall be (a) the
value of the Assets computed as of the close of regular trading on the New York
Stock Exchange ("NYSE") on the date of the Closing ("Valuation Time"), using the
valuation procedures set forth in its then-current prospectus and statement of
additional information ("SAI"), less (b) the amount of the Liabilities as of the
Valuation Time.
2.2. For purposes of paragraph 1.1(a), the NAV of an Acquiring Fund Share
shall be computed as of the Valuation Time, using the valuation procedures set
forth in Acquiring Fund's then-current prospectus and SAI.
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<PAGE>
2.3. All computations pursuant to paragraphs 2.1 and 2.2 shall be made by
or under the direction of Neuberger Berman Management Inc.
3. CLOSING AND EFFECTIVE TIME
3.1. The Reorganization, together with related acts necessary to consummate
the same ("Closing"), shall occur at the Investment Companies' principal office
on or about [____ _], 2000, or at such other place and/or on such other date as
to which the Investment Companies may agree. All acts taking place at the
Closing shall be deemed to take place simultaneously as of the close of business
on the date thereof or at such other time as to which the Investment Companies
may agree ("Effective Time"). If, immediately before the Valuation Time, (a) the
NYSE is closed to trading or trading thereon is restricted or (b) trading or the
reporting of trading on the NYSE or elsewhere is disrupted, so that accurate
appraisal of Target's net value and/or the NAV of an Acquiring Fund Share is
impracticable, the Effective Time shall be postponed until the first business
day after the day when that trading shall have been fully resumed and that
reporting shall have been restored.
3.2. Equity Trust's fund accounting and pricing agent shall deliver at the
Closing a certificate of an authorized officer verifying that the information
(including adjusted basis and holding period, by lot) concerning the Assets,
including all portfolio securities, transferred by Target to Acquiring Fund, as
reflected on Acquiring Fund's books immediately after the Closing, does or will
conform to that information on Target's books immediately before the Closing.
Equity Trust's custodian shall deliver at the Closing a certificate of an
authorized officer stating that (a) the Assets it holds will be transferred to
Acquiring Fund at the Effective Time and (b) all necessary taxes in conjunction
with the delivery of the Assets, including all applicable federal and state
stock transfer stamps, if any, have been paid or provision for payment has been
made.
3.3. Equity Trust shall deliver to Equity Funds at the Closing a list of
the names and addresses of the Shareholders and the number of outstanding Target
Shares owned by each Shareholder, all as of the Effective Time, certified by
Equity Trust's Secretary or an Assistant Secretary thereof. Equity Fund's
transfer agent shall deliver at the Closing a certificate as to the opening on
Acquiring Fund's share transfer books of accounts in the Shareholders' names.
Equity Funds shall issue and deliver a confirmation to Equity Trust evidencing
the Acquiring Fund Shares to be credited to Target at the Effective Time or
provide evidence satisfactory to Equity Trust that those Acquiring Fund Shares
have been credited to Target's account on Acquiring Fund's books.
3.4. Each Investment Company shall deliver to the other at the Closing (a)
a certificate executed in its name by its President or a Vice President in form
and substance satisfactory to the recipient and dated the Effective Time, to the
effect that the representations and warranties it made in this Agreement are
true and correct at the Effective Time except as they may be affected by the
transactions contemplated by this Agreement and (b) bills of sale, checks,
assignments, stock certificates, receipts, and other documents the other
Investment Company or its counsel reasonably requests.
4. REPRESENTATIONS AND WARRANTIES
------------------------------
4.1. Equity Trust represents and warrants as follows:
4.1.1. Equity Trust is a business trust duly organized and validly
existing under the laws of the State of Delaware, and its Certificate
of Trust has been duly filed in the office of the Secretary of State
thereof;
4.1.2. Equity Trust is duly registered as an open-end management
investment company under the Investment Company Act of 1940, as amended
("1940 Act"), and that registration will be in full force and effect at
the Effective Time;
4.1.3. Target is a duly established and designated series of
Equity Trust;
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<PAGE>
4.1.4. At the Closing, Target will have good and marketable title
to the Assets and full right, power, and authority to sell, assign,
transfer, and deliver the Assets free of any liens or other
encumbrances; and on delivery and payment for the Assets, Acquiring
Fund will acquire good and marketable title thereto;
4.1.5. Target's current prospectus and SAI conform in all material
respects to the applicable requirements of the Securities Act of 1933,
as amended ("1933 Act"), and the 1940 Act and the rules and regulations
thereunder and do not include any untrue statement of a material fact
or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading;
4.1.6. Target is not in violation of, and the execution and
delivery of this Agreement and consummation of the transactions
contemplated hereby will not conflict with or violate, Delaware law or
any provision of the Amended and Restated Trust Instrument ("Trust
Instrument") or By-Laws of Equity Trust or of any agreement,
instrument, lease, or other undertaking to which Target is a party or
by which it is bound or result in the acceleration of any obligation,
or the imposition of any penalty, under any agreement, judgment, or
decree to which Target is a party or by which it is bound, except as
previously disclosed in writing to and accepted by Equity Funds;
4.1.7. Except as otherwise disclosed in writing to and accepted by
Equity Funds, all material contracts and other commitments of or
applicable to Target (other than this Agreement and investment
contracts, including options, futures, and forward contracts) will be
terminated, or provision for discharge of any liabilities of Target
thereunder will be made, at or prior to the Effective Time, without
either Fund's incurring any liability or penalty with respect thereto
and without diminishing or releasing any rights Target may have had
with respect to actions taken or omitted or to be taken by any other
party thereto prior to the Closing;
4.1.8. Except as otherwise disclosed in writing to and accepted by
Equity Funds, no litigation, administrative proceeding, or
investigation of or before any court or governmental body is presently
pending or (to Equity Trust's knowledge) threatened against Equity
Trust with respect to Target or any of its properties or assets that,
if adversely determined, would materially and adversely affect Target's
financial condition or the conduct of its business; and Equity Trust
knows of no facts that might form the basis for the institution of any
such litigation, proceeding, or investigation and is not a party to or
subject to the provisions of any order, decree, or judgment of any
court or governmental body that materially or adversely affects its
business or its ability to consummate the transactions contemplated
hereby;
4.1.9. The execution, delivery, and performance of this Agreement
have been duly authorized as of the date hereof by all necessary action
on the part of Equity Trust's board of trustees, which has made the
determinations required by Rule 17a-8(a) under the 1940 Act; and,
subject to approval by Target's shareholders, this Agreement
constitutes a valid and legally binding obligation of Target,
enforceable in accordance with its terms, except as the same may be
limited by bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium, and similar laws relating to or affecting creditors' rights
and by general principles of equity;
4.1.10. At the Effective Time, the performance of this Agreement
shall have been duly authorized by all necessary action by Target's
shareholders;
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4.1.11. No governmental consents, approvals, authorizations, or
filings are required under the 1933 Act, the Securities Exchange Act of
1934, as amended ("1934 Act"), or the 1940 Act for the execution or
performance of this Agreement by Equity Trust, except for (a) the
filing with the Securities and Exchange Commission ("SEC") of a
registration statement by Equity Funds on Form N-14 relating to the
Acquiring Fund Shares issuable hereunder, and any supplement or
amendment thereto ("Registration Statement"), including therein a
prospectus/proxy statement ("Proxy Statement"), and (b) such consents,
approvals, authorizations, and filings as have been made or received or
as may be required subsequent to the Effective Time;
4.1.12. On the effective date of the Registration Statement, at
the time of the shareholders' meeting referred to in paragraph 5.2, and
at the Effective Time, the Proxy Statement will (a) comply in all
material respects with the applicable provisions of the 1933 Act, the
1934 Act, and the 1940 Act and the rules and regulations thereunder and
(b) not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading; provided that the foregoing shall not
apply to statements in or omissions from the Proxy Statement made in
reliance on and in conformity with information furnished by Equity
Funds for use therein;
4.1.13. The Liabilities were incurred by Target in the ordinary
course of its business and are associated with the Assets; and there
are no Liabilities other than liabilities disclosed or provided for in
Equity Trust's financial statements referred to in paragraph 4.1.18 and
liabilities incurred by Target in the ordinary course of its business
subsequent to [_______ __, 2000], or otherwise previously disclosed to
Equity Funds, none of which has been materially adverse to the
business, assets, or results of Target's operations;
4.1.14. Target is a "fund" as defined in section 851(g)(2) of the
Code; it qualified for treatment as a regulated investment company
under Subchapter M of the Code ("RIC") for each past taxable year since
it commenced operations and will continue to meet all the requirements
for that qualification for its current taxable year; the Assets will be
invested at all times through the Effective Time in a manner that
ensures compliance with the foregoing; and Target has no earnings and
profits accumulated in any taxable year in which the provisions of
Subchapter M did not apply to it;
4.1.15. Target is not under the jurisdiction of a court in a
"title 11 or similar case" (within the meaning of section 368(a)(3)(A)
of the Code);
4.1.16. During the five-year period ending on the Closing Date,
neither Target nor any person "related" (as defined in section
1.368-1(e)(3) of the Regulations without regard to section
1.368-1(e)(3)(i)(A) thereof) to Target will have directly or through
any transaction, agreement, or arrangement with any other person, (a)
acquired Target Shares with consideration other than Acquiring Fund
Shares or Target Shares, except for shares redeemed in the ordinary
course of Target's business as a series of an open-end investment
company as required by the 1940 Act, or (b) made distributions with
respect to Target Shares, except for (i) dividends qualifying for the
deduction for dividends paid (as defined in section 561 of the Code)
referred to in sections 852(a)(1) and 4982(c)(1)(A) of the Code and
(ii) additional distributions, to the extent they do not exceed 50% of
the value (without giving effect to those distributions) of the
proprietary interest in Target on the Closing Date;
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4.1.17. Target's federal income tax returns, and all applicable
state and local tax returns, for all taxable years through and
including the taxable year ended [_____ __, ____], have been timely
filed and all taxes payable pursuant to those returns have been timely
paid; and
4.1.18. Equity Trust's financial statements for the year ended
[_____ __, ____], [AND FOR THE SIX MONTHS ENDED _____ __, 2000,] to be
delivered to Equity Funds, fairly represent Target's financial position
as of that [EACH SUCH] date and the results of its operations and
changes in its net assets for the year [PERIOD] then ended.
4.2. Equity Funds represents and warrants as follows:
4.2.1. Equity Funds is a business trust duly organized and validly
existing under the laws of the State of Delaware, and its Certificate
of Trust has been duly filed in the office of the Secretary of State
thereof;
4.2.2. Equity Funds is duly registered as an open-end management
investment company under the 1940 Act, and that registration will be in
full force and effect at the Effective Time;
4.2.3. Acquiring Fund is a duly established and designated series
of Equity Funds;
4.2.4. No consideration other than Acquiring Fund Shares (and
Acquiring Fund's assumption of the Liabilities) will be issued in
exchange for the Assets in the Reorganization;
4.2.5. The Acquiring Fund Shares to be issued and delivered to
Target hereunder will, at the Effective Time, have been duly authorized
and, when issued and delivered as provided herein, will be duly and
validly issued and outstanding shares of Acquiring Fund, fully paid and
non-assessable;
4.2.6. Acquiring Fund's current prospectus and SAI conform in all
material respects to the applicable requirements of the 1933 Act and
the 1940 Act and the rules and regulations thereunder and do not
include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading;
4.2.7. Acquiring Fund is not in violation of, and the execution
and delivery of this Agreement and consummation of the transactions
contemplated hereby will not conflict with or violate, Delaware law or
any provision of the Trust Instrument or By-Laws of Equity Funds or of
any provision of any agreement, instrument, lease, or other undertaking
to which Acquiring Fund is a party or by which it is bound or result in
the acceleration of any obligation, or the imposition of any penalty,
under any agreement, judgment, or decree to which Acquiring Fund is a
party or by which it is bound, except as previously disclosed in
writing to and accepted by Equity Trust;
4.2.8. Except as otherwise disclosed in writing to and accepted by
Equity Trust, no litigation, administrative proceeding, or
investigation of or before any court or governmental body is presently
pending or (to Equity Fund's knowledge) threatened against Equity Funds
with respect to Acquiring Fund or any of its properties or assets that,
if adversely determined, would materially and adversely affect
Acquiring Fund's financial condition or the conduct of its business;
and Equity Funds knows of no facts that might form the basis for the
institution of any such litigation, proceeding, or investigation and is
not a party to or subject to the provisions of any order, decree, or
judgment of any court or governmental body that materially or adversely
affects its business or its ability to consummate the transactions
contemplated hereby;
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<PAGE>
4.2.9. The execution, delivery, and performance of this Agreement
have been duly authorized as of the date hereof by all necessary action
on the part of Equity Fund's board of trustees (together with Equity
Trust's board of trustees, the "Boards"), which has made the
determinations required by Rule 17a-8(a) under the 1940 Act; and this
Agreement constitutes a valid and legally binding obligation of
Acquiring Fund, enforceable in accordance with its terms, except as the
same may be limited by bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium, and similar laws relating to or affecting
creditors' rights and by general principles of equity;
4.2.10. No governmental consents, approvals, authorizations, or
filings are required under the 1933 Act, the 1934 Act, or the 1940 Act
for the execution or performance of this Agreement by Equity Funds,
except for (a) the filing with the SEC of the Registration Statement
and (b) such consents, approvals, authorizations, and filings as have
been made or received or as may be required subsequent to the Effective
Time;
4.2.11. On the effective date of the Registration Statement, at
the time of the shareholders' meeting referred to in paragraph 5.2, and
at the Effective Time, the Proxy Statement will (a) comply in all
material respects with the applicable provisions of the 1933 Act, the
1934 Act, and the 1940 Act and the rules and regulations thereunder and
(b) not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading; provided that the foregoing shall not
apply to statements in or omissions from the Proxy Statement made in
reliance on and in conformity with information furnished by Equity
Trust for use therein;
4.2.12. Acquiring Fund is a "fund" as defined in section 851(g)(2)
of the Code; it qualified for treatment as a RIC for each past taxable
year since it commenced operations and will continue to meet all the
requirements for such qualification for its current taxable year; it
intends to continue to meet all such requirements for the next taxable
year; and it has no earnings and profits accumulated in any taxable
year in which the provisions of Subchapter M of the Code did not apply
to it;
4.2.13. Acquiring Fund has no plan or intention to issue
additional Acquiring Fund Shares following the Reorganization except
for shares issued in the ordinary course of its business as a series of
an open-end investment company; nor does Acquiring Fund, or any person
"related" (within the meaning of section 1.368-1(e)(3) of the
Regulations) to Acquiring Fund, have any plan or intention to redeem or
otherwise reacquire any Acquiring Fund Shares issued to the
Shareholders pursuant to the Reorganization, except to the extent it is
required by the 1940 Act to redeem any of its shares presented for
redemption at NAV in the ordinary course of that business;
4.2.14. Following the Reorganization, Acquiring Fund (a) will
continue Target's "historic business" (within the meaning of section
1.368-1(d)(2) of the Regulations), (b) will use a significant portion
of Target's "historic business assets" (within the meaning of section
1.368-1(d)(3) of the Regulations) in a business; in addition, Acquiring
Fund has no plan or intention to sell or otherwise dispose of any of
the Assets, except for dispositions made in the ordinary course of that
business and dispositions necessary to maintain its status as a RIC;
4.2.15. There is no plan or intention for Acquiring Fund to be
dissolved or merged into another business trust or a corporation or any
"fund" thereof (within the meaning of section 851(g)(2) of the Code)
following the Reorganization;
- 7 -
<PAGE>
4.2.16. Acquiring Fund does not directly or indirectly own, nor at
the Effective Time will it directly or indirectly own, nor has it
directly or indirectly owned at any time during the past five years,
any shares of Target;
4.2.17. Acquiring Fund's federal income tax returns, and all
applicable state and local tax returns, for all taxable years through
and including the taxable year ended [_____ __, ____], have been timely
filed and all taxes payable pursuant to such returns have been timely
paid; and
4.2.18. Equity Fund's financial statements for the year ended
[_____ __, ____], [AND FOR THE SIX MONTHS ENDED _____ __, 2000,] to be
delivered to Equity Trust, fairly represent Acquiring Fund's financial
position as of that [EACH SUCH] date and the results of its operations
and changes in its net assets for the year [PERIOD] then ended.
4.3. Each Investment Company represents and warrants as follows:
4.3.1. The fair market value of the Acquiring Fund Shares received
by each Shareholder will be approximately equal to the fair market
value of its Target Shares constructively surrendered in exchange
therefor; 4.3.2. Its management (a) is unaware of any plan or intention
of Shareholders to redeem, sell, or otherwise dispose of (i) any
portion of their Target Shares before the Reorganization to any person
"related" (within the meaning of section 1.368-1(e)(3) of the
Regulations) to either Fund or (ii) any portion of the Acquiring Fund
Shares to be received by them in the Reorganization to any person
"related" (within such meaning) to Acquiring Fund, (b) does not
anticipate dispositions of those Acquiring Fund Shares at the time of
or soon after the Reorganization to exceed the usual rate and frequency
of dispositions of shares of Target as a series of an open-end
investment company, (c) expects that the percentage of Shareholder
interests, if any, that will be disposed of as a result of or at the
time of the Reorganization will be DE MINIMIS, and (d) does not
anticipate that there will be extraordinary redemptions of Acquiring
Fund Shares immediately following the Reorganization;
4.3.3. The Shareholders will pay their own expenses, if any,
incurred in connection with the Reorganization;
4.3.4. The fair market value of the Assets on a going concern
basis will equal or exceed the Liabilities to be assumed by Acquiring
Fund and those to which the Assets are subject;
4.3.5. There is no intercompany indebtedness between the Funds
that was issued or acquired, or will be settled, at a discount;
4.3.6. Pursuant to the Reorganization, Target will transfer to
Acquiring Fund, and Acquiring Fund will acquire, at least 90% of the
fair market value of the net assets, and at least 70% of the fair
market value of the gross assets, Target held immediately before the
Reorganization. For the purposes of this representation, any amounts
Target used to pay its Reorganization expenses and to make redemptions
and distributions immediately before the Reorganization (except (a)
redemptions in the ordinary course of its business required by section
22(e) of the 1940 Act and (b) regular, normal dividend distributions
made to conform to its policy of distributing all or substantially all
of its income and gains to avoid the obligation to pay federal income
tax and/or the excise tax under section 4982 of the Code) after the
date of this Agreement will be included as assets held thereby
immediately before the Reorganization;
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<PAGE>
4.3.7. None of the compensation received by any Shareholder who is
an employee of or service provider to Target will be separate
consideration for, or allocable to, any of the Target Shares held by
that Shareholder; none of the Acquiring Fund Shares received by any
such Shareholder will be separate consideration for, or allocable to,
any employment agreement, investment advisory agreement, or other
service agreement; and the consideration paid to any such Shareholder
will be for services actually rendered and will be commensurate with
amounts paid to third parties bargaining at arm's-length for similar
services;
4.3.8. Immediately after the Reorganization, the Shareholders will
not own shares constituting "control" (within the meaning of section
304(c) of the Code) of Acquiring Fund; and
4.3.9. Neither Fund will be reimbursed for any expenses incurred
by it or on its behalf in connection with the Reorganization unless
those expenses are solely and directly related to the Reorganization
(determined in accordance with the guidelines set forth in Rev. Rul.
73-54, 1973-1 C.B. 187).
5. COVENANTS
5.1. Each Fund covenants to operate its respective business in the
ordinary course between the date hereof and the Closing, it being understood
that --
(a) such ordinary course will include declaring and paying customary
dividends and other distributions and changes in operations
contemplated by each Fund's normal business activities, and
(b) each Fund will retain exclusive control of its investments until
the Closing; provided that Target shall not dispose of more than an
insignificant portion of its historic business assets (as defined
above) during that period without Acquiring Fund's prior consent.
5.2. Target covenants to call a shareholders' meeting to consider and act
on this Agreement and to take all other action necessary to obtain approval of
the transactions contemplated hereby.
5.3. Target covenants that the Acquiring Fund Shares to be delivered
hereunder are not being acquired for the purpose of making any distribution
thereof, other than in accordance with the terms hereof.
5.4. Target covenants that it will assist Equity Funds in obtaining
information Equity Funds reasonably requests concerning the beneficial ownership
of Target Shares.
5.5. Target covenants that its books and records (including all books and
records required to be maintained under the 1940 Act and the rules and
regulations thereunder) will be turned over to Equity Funds at the Closing.
5.6. Each Fund covenants to cooperate in preparing the Proxy Statement in
compliance with applicable federal and state securities laws.
5.7. Each Fund covenants that it will, from time to time, as and when
requested by the other Fund, execute and deliver or cause to be executed and
delivered all assignments and other instruments, and will take or cause to be
taken further action, the other Fund may deem necessary or desirable to vest in,
and confirm to, (a) Acquiring Fund, title to and possession of all the Assets,
and (b) Target, title to and possession of the Acquiring Fund Shares to be
delivered hereunder, and otherwise to carry out the intent and purpose hereof.
5.8. Acquiring Fund covenants to use all reasonable efforts to obtain the
approvals and authorizations required by the 1933 Act, the 1940 Act, and state
securities laws it deems appropriate to continue its operations after the
Effective Time.
- 9 -
<PAGE>
5.9. Subject to this Agreement, each Fund covenants to take or cause to be
taken all actions, and to do or cause to be done all things, reasonably
necessary, proper, or advisable to consummate and effectuate the transactions
contemplated hereby.
6. CONDITIONS PRECEDENT
Each Fund's obligations hereunder shall be subject to (a) the other Fund's
performance of all its obligations to be performed hereunder at or before the
Effective Time, (b) all representations and warranties of the other Fund
contained herein being true and correct in all material respects as of the date
hereof and, except as they may be affected by the transactions contemplated
hereby, as of the Effective Time, with the same force and effect as if made at
and as of the Effective Time, and (c) the following further conditions that, at
or before the Effective Time:
6.1. This Agreement and the transactions contemplated hereby shall have
been duly adopted and approved by each Board and shall have been approved by
Target's shareholders in accordance with Equity Trust's Trust Instrument and
By-Laws and applicable law.
6.2. All necessary filings shall have been made with the SEC and state
securities authorities, and no order or directive shall have been received that
any other or further action is required to permit the parties to carry out the
transactions contemplated hereby. The Registration Statement shall have become
effective under the 1933 Act, no stop orders suspending the effectiveness
thereof shall have been issued, and the SEC shall not have issued an unfavorable
report with respect to the Reorganization under section 25(b) of the 1940 Act
nor instituted any proceedings seeking to enjoin consummation of the
transactions contemplated hereby under section 25(c) of the 1940 Act. All
consents, orders, and permits of federal, state, and local regulatory
authorities (including the SEC and state securities authorities) deemed
necessary by either Investment Company to permit consummation, in all material
respects, of the transactions contemplated hereby shall have been obtained,
except where failure to obtain same would not involve a risk of a material
adverse effect on either Fund's assets or properties, provided that either
Investment Company may for itself waive any of such conditions.
6.3. At the Effective Time, no action, suit, or other proceeding shall be
pending before any court or governmental agency in which it is sought to
restrain or prohibit, or to obtain damages or other relief in connection with,
the transactions contemplated hereby.
6.4. Equity Trust shall have received an opinion of Kirkpatrick & Lockhart
LLP ("Counsel") substantially to the effect that:
6.4.1. Acquiring Fund is a duly established series of Equity
Funds, a business trust duly organized and validly existing under the
laws of the State of Delaware with power under its Trust Instrument to
own all its properties and assets and, to the knowledge of Counsel, to
carry on its business as presently conducted;
6.4.2. This Agreement (a) has been duly authorized, executed, and
delivered by Equity Funds on behalf of Acquiring Fund and (b) assuming
due authorization, execution, and delivery of this Agreement by Equity
Trust on behalf of Target, is a valid and legally binding obligation of
Equity Funds with respect to Acquiring Fund, enforceable in accordance
with its terms, except as the same may be limited by bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium, and
similar laws relating to or affecting creditors' rights and by general
principles of equity;
6.4.3. The Acquiring Fund Shares to be issued and distributed to
the Shareholders under this Agreement, assuming their due delivery as
contemplated by this Agreement, will be duly authorized, validly issued
and outstanding, and fully paid and non-assessable;
- 10 -
<PAGE>
6.4.4. The execution and delivery of this Agreement did not, and
the consummation of the transactions contemplated hereby will not,
materially violate Equity Fund's Trust Instrument or By-Laws or any
provision of any agreement (known to Counsel, without any independent
inquiry or investigation) to which Equity Funds (with respect to
Acquiring Fund) is a party or by which it is bound or (to the knowledge
of Counsel, without any independent inquiry or investigation) result in
the acceleration of any obligation, or the imposition of any penalty,
under any agreement, judgment, or decree to which Equity Funds (with
respect to Acquiring Fund) is a party or by which it is bound, except
as set forth in that opinion or as previously disclosed in writing to
and accepted by Equity Trust;
6.4.5. To the knowledge of Counsel (without any independent
inquiry or investigation), no consent, approval, authorization, or
order of any court or governmental authority is required for the
consummation by Equity Funds (on behalf of Acquiring Fund) of the
transactions contemplated herein, except those obtained under the 1933
Act, the 1934 Act, and the 1940 Act and those that may be required
under state securities laws;
6.4.6. Equity Funds is registered with the SEC as an investment
company, and to the knowledge of Counsel no order has been issued or
proceeding instituted to suspend that registration; and
6.4.7. To the knowledge of Counsel (without any independent
inquiry or investigation), (a) no litigation, administrative
proceeding, or investigation of or before any court or governmental
body is pending or threatened as to Equity Funds (with respect to
Acquiring Fund) or any of its properties or assets attributable or
allocable to Acquiring Fund and (b) Equity Funds (with respect to
Acquiring Fund) is not a party to or subject to the provisions of any
order, decree, or judgment of any court or governmental body that
materially and adversely affects Acquiring Fund's business, except as
set forth in that opinion or as otherwise disclosed in writing to and
accepted by Equity Trust.
In rendering the foregoing opinion, Counsel may (1) rely, as to matters governed
by the laws of the State of Delaware, on an opinion of competent Delaware
counsel, (2) make assumptions regarding the authenticity, genuineness, and/or
conformity of documents and copies thereof without independent verification
thereof, (3) limit that opinion to applicable federal and state law, and (4)
define the word "knowledge" and related terms to mean the knowledge of attorneys
then with Counsel who have devoted substantive attention to matters directly
related to this Agreement and the Reorganization.
6.5. Equity Funds shall have received an opinion of Counsel
substantially to the effect that:
6.5.1. Target is a duly established series of Equity Trust, a
business trust duly organized and validly existing under the laws of
the State of Delaware with power under its Trust Instrument to own all
its properties and assets and, to the knowledge of Counsel, to carry on
its business as presently conducted;
6.5.2. This Agreement (a) has been duly authorized, executed, and
delivered by Equity Trust on behalf of Target and (b) assuming due
authorization, execution, and delivery of this Agreement by Equity
Funds on behalf of Acquiring Fund, is a valid and legally binding
obligation of Equity Trust with respect to Target, enforceable in
accordance with its terms, except as the same may be limited by
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium, and similar laws relating to or affecting creditors' rights
and by general principles of equity;
6.5.3. The execution and delivery of this Agreement did not, and
the consummation of the transactions contemplated hereby will not,
materially violate Equity Trust's Trust Instrument or By-Laws or any
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<PAGE>
provision of any agreement (known to Counsel, without any independent
inquiry or investigation) to which Equity Trust (with respect to
Target) is a party or by which it is bound or (to the knowledge of
Counsel, without any independent inquiry or investigation) result in
the acceleration of any obligation, or the imposition of any penalty,
under any agreement, judgment, or decree to which Equity Trust (with
respect to Target) is a party or by which it is bound, except as set
forth in that opinion or as previously disclosed in writing to and
accepted by Equity Funds;
6.5.4. To the knowledge of Counsel (without any independent
inquiry or investigation), no consent, approval, authorization, or
order of any court or governmental authority is required for the
consummation by Equity Trust (on behalf of Target) of the transactions
contemplated herein, except those obtained under the 1933 Act, the
1934 Act, and the 1940 Act and those that may be required under state
securities laws;
6.5.5. Equity Trust is registered with the SEC as an investment
company, and to the knowledge of Counsel no order has been issued or
proceeding instituted to suspend that registration; and
6.5.6. To the knowledge of Counsel (without any independent
inquiry or investigation), (a) no litigation, administrative
proceeding, or investigation of or before any court or governmental
body is pending or threatened as to Equity Trust (with respect to
Target) or any of its properties or assets attributable or allocable
to Target and (b) Equity Trust (with respect to Target) is not a party
to or subject to the provisions of any order, decree, or judgment of
any court or governmental body that materially and adversely affects
Target's business, except as set forth in that opinion or as otherwise
disclosed in writing to and accepted by Equity Funds.
In rendering the foregoing opinion, Counsel may (1) rely, as to matters governed
by the laws of the State of Delaware, on an opinion of competent Delaware
counsel, (2) make assumptions regarding the authenticity, genuineness, and/or
conformity of documents and copies thereof without independent verification
thereof, (3) limit such opinion to applicable federal and state law, and (4)
define the word "knowledge" and related terms to mean the knowledge of attorneys
then with Counsel who have devoted substantive attention to matters directly
related to this Agreement and the Reorganization.
6.6. Each Investment Company shall have received an opinion of Counsel,
addressed to and in form and substance reasonably satisfactory to it, as to the
federal income tax consequences mentioned below ("Tax Opinion"). In rendering
the Tax Opinion, Counsel may rely as to factual matters, exclusively and without
independent verification, on the representations made in this Agreement, which
Counsel may treat as representations made to it, or in separate letters
addressed to Counsel and the certificates delivered pursuant to paragraph 3.4.
The Tax Opinion shall be substantially to the effect that, based on the facts
and assumptions stated therein and conditioned on consummation of the
Reorganization in accordance with this Agreement, for federal income tax
purposes:
6.6.1. Acquiring Fund's acquisition of the Assets in exchange
solely for Acquiring Fund Shares and Acquiring Fund's assumption of the
Liabilities, followed by Target's distribution of those shares PRO RATA
to the Shareholders constructively in exchange for their Target Shares,
will qualify as a reorganization within the meaning of section
368(a)(1) of the Code, and each Fund will be "a party to a
reorganization" within the meaning of section 368(b) of the Code;
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<PAGE>
6.6.2. Target will recognize no gain or loss on the transfer of
the Assets to Acquiring Fund in exchange solely for Acquiring Fund
Shares and Acquiring Fund's assumption of the Liabilities or on the
subsequent distribution of those shares to the Shareholders in
constructive exchange for their Target Shares;
6.6.3. Acquiring Fund will recognize no gain or loss on its
receipt of the Assets in exchange solely for Acquiring Fund Shares and
its assumption of the Liabilities;
6.6.4. Acquiring Fund's basis in the Assets will be the same as
Target's basis therein immediately before the Reorganization, and
Acquiring Fund's holding period for the Assets will include Target's
holding period therefor;
6.6.5. A Shareholder will recognize no gain or loss on the
constructive exchange of all its Target Shares solely for Acquiring
Fund Shares pursuant to the Reorganization; and
6.6.6. A Shareholder's aggregate basis in the Acquiring Fund
Shares to be received by it in the Reorganization will be the same as
the aggregate basis in its Target Shares to be constructively
surrendered in exchange for those Acquiring Fund Shares, and its
holding period for those Acquiring Fund Shares will include its holding
period for those Target Shares, provided the Shareholder held them as
capital assets at the Effective Time.
Notwithstanding subparagraphs 6.6.2 and 6.6.4, the Tax Opinion may state that no
opinion is expressed as to the effect of the Reorganization on the Funds or any
Shareholder with respect to any asset as to which any unrealized gain or loss is
required to be recognized for federal income tax purposes at the end of a
taxable year (or on the termination or transfer thereof) under a mark-to-market
system of accounting.
At any time before the Closing, either Investment Company may waive any
of the foregoing conditions (except that set forth in paragraph 6.1) if, in the
judgment of its Board, that waiver will not have a material adverse effect on
its Fund's shareholders' interests.
7. BROKERAGE FEES AND EXPENSES
7.1. Each Investment Company represents and warrants to the other that
there are no brokers or finders entitled to receive any payments in connection
with the transactions provided for herein.
7.2. Each Fund will bear its own Reorganization expenses.
8. ENTIRE AGREEMENT; NO SURVIVAL
-----------------------------
Neither party has made any representation, warranty, or covenant not set
forth herein, and this Agreement constitutes the entire agreement between the
parties. The representations, warranties, and covenants contained herein or in
any document delivered pursuant hereto or in connection herewith shall not
survive the Closing.
9. TERMINATION OF AGREEMENT
------------------------
This Agreement may be terminated at any time at or prior to the Effective
Time, whether before or after approval by Target's shareholders:
9.1. By either Fund (a) in the event of the other Fund's material breach of
any representation, warranty, or covenant contained herein to be performed at or
prior to the Effective Time, (b) if a condition to its obligations has not been
met and it reasonably appears that such condition will not or cannot be met, or
(c) if the Closing has not occurred on or before December 31, 2000; or
9.2. With respect to any funds, by the parties' mutual agreement.
In the event of termination under paragraphs 9.1(c) or 9.2, there shall be no
liability for damages on the part of either Fund, or the trustees or officers of
either Investment Company, to the other Fund.
- 13 -
<PAGE>
10. AMENDMENT
---------
This Agreement may be amended, modified, or supplemented at any time,
notwithstanding approval thereof by Target's shareholders, in any manner
mutually agreed on in writing by the parties; provided that following that
approval no such amendment shall have a material adverse effect on the
Shareholders' interests.
11. MISCELLANEOUS
-------------
11.1. This Agreement shall be governed by and construed in accordance with
the internal laws of the State of Delaware; provided that, in the case of any
conflict between those laws and the federal securities laws, the latter shall
govern.
11.2. Nothing expressed or implied herein is intended or shall be construed
to confer on or give any person, firm, trust, or corporation other than the
parties and their respective successors and assigns any rights or remedies under
or by reason of this Agreement.
11.3. Each Investment Company acknowledges that the other is a business
trust organized in series form. This Agreement is executed by Equity Funds on
behalf of Acquiring Fund, and by Equity Trust on behalf of Target, and by their
respective trustees and/or officers in their capacities as such, and not
individually. Each Investment Company's obligations under this Agreement are not
binding on or enforceable against any of its trustees, officers, or shareholders
but are only binding on and enforceable against (a) in the case of Equity Funds,
the assets and property of Acquiring Fund and no other series thereof and (b) in
the case of Equity Trust, the assets and property of Target and no other series
thereof. A trustee of one Investment Company shall not be personally liable
hereunder to the other Investment Company or its trustees or shareholders for
any act, omission, or obligation of the former Investment Company or any other
trustee thereof. Each Investment Company agrees that, in asserting any rights or
claims under this Agreement on behalf of its Fund, it shall look only to the
other Fund's assets and property in settlement of those rights and claims and
not to those trustees, officers, or shareholders.
11.4. This Agreement may be executed in one or more counterparts, all of
which shall be considered one and the same agreement, and shall become effective
when one or more counterparts have been executed by each Investment Company and
delivered to the other party. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
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<PAGE>
IN WITNESS WHEREOF, each party has caused this Agreement to be executed
and delivered by its duly authorized officers as of the day and year first
written above.
ATTEST: NEUBERGER BERMAN EQUITY FUNDS, on behalf
of each of its series listed on Schedule A
----------------------------- By:_____________________________________
Secretary __________________
Vice President
ATTEST: NEUBERGER BERMAN EQUITY TRUST, on behalf
of each of its series listed on Schedule A
----------------------------- By:_____________________________________
Secretary __________________
Vice President
- 15 -
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE A
TARGETS ACQUIRING FUNDS
(All Series of Equity Trust) (All Series of Equity Funds)
---------------------------------------------- ------------------------------------------
<S> <C>
Neuberger Berman Century Trust Neuberger Berman Century Fund
Neuberger Berman Focus Trust Neuberger Berman Focus Fund
Neuberger Berman Genesis Trust Neuberger Berman Genesis Fund
Neuberger Berman Guardian Trust Neuberger Berman Guardian Fund
Neuberger Berman International Trust Neuberger Berman International Fund
Neuberger Berman Manhattan Trust Neuberger Berman Manhattan Fund
Neuberger Berman Millennium Trust Neuberger Berman Millennium Fund
Neuberger Berman Partners Trust Neuberger Berman Partners Fund
Neuberger Berman Regency Trust Neuberger Berman Regency Fund
Neuberger Berman Socially Responsive Trust Neuberger Berman Socially Responsive Fund
Neuberger Berman Technology Trust Neuberger Berman Technology Fund
</TABLE>
- 16 -
<PAGE>
APPENDIX B
FORM OF
NEUBERGER BERMAN EQUITY TRUST
PLAN PURSUANT TO RULE 12B-1
WHEREAS, Neuberger Berman Equity Trust ("Trust") is an open-end
management investment company registered under the Investment Company Act of
1940, as amended ("1940 Act"), and intends to offer for public sale shares of
beneficial interest in several series (each series a "Fund");
WHEREAS, the Trust desires to adopt a plan pursuant to Rule 12b-1 under
the 1940 Act and the Board of Trustees has determined that there is a reasonable
likelihood that adoption of said plan will benefit the Funds and their
shareholders; and
WHEREAS, the Trust has employed Neuberger Berman Management Inc.
("NBMI") as principal underwriter of the shares of the Trust;
NOW, THEREFORE, the Trust hereby adopts this Plan Pursuant to Rule 12b-1
("Plan") in accordance with Rule 12b-1 under the 1940 Act on the following terms
and conditions:
1. This Plan applies to the Funds listed on Schedule A.
2. A. Each Fund shall pay to NBMI, as compensation for selling Fund
shares or for providing services to Fund shareholders, a fee at the rate
specified for that Fund on Schedule A, such fee to be calculated and accrued
daily and paid monthly or at such other intervals as the Board shall determine.
B. The fees payable hereunder are payable without regard to the
aggregate amount that may be paid over the years, PROVIDED THAT, so long as the
limitations set forth in Rule 2830 of the Conduct Rules ("Rule 2830") of the
National Association of Securities Dealers, Inc. ("NASD") remain in effect and
apply to recipients of payments made under this Plan, the amounts paid hereunder
shall not exceed those limitations, including permissible interest. Amounts
expended in support of the activities described in Paragraph 3.B. of this Plan
may be excluded in determining whether expenditures under the Plan exceed the
appropriate percentage of new gross assets specified in Rule 2830.
3. A. As principal underwriter of the Trust's shares, NBMI may
spend such amounts as it deems appropriate on any activities or expenses
primarily intended to result in the sale of shares of the Funds, including, but
not limited to, compensation to employees of NBMI; compensation to NBMI and
other broker-dealers that engage in or support the distribution of shares;
expenses of NBMI and such other broker-dealers and entities, including overhead
and telephone and other communication expenses; the printing of prospectuses,
statements of additional information, and reports for other than existing
shareholders; and the preparation and distribution of sales literature and
advertising materials.
<PAGE>
B. NBMI may spend such amounts as it deems appropriate on the
administration and servicing of shareholder accounts, including, but not limited
to, responding to inquiries from shareholders or their representatives
requesting information regarding matters such as shareholder account or
transaction status, net asset value of shares, performances, services, plans and
options, investment policies, portfolio holdings, and distributions and taxation
thereof; and dealing with complaints and correspondence of shareholders;
including compensation to organizations and employees who service shareholder
accounts, and expenses of such organizations, including overhead and telephone
and other communications expenses.
4. This Plan shall take effect on December 1, 2000 and shall continue in
effect with respect to each Fund for successive periods of one year from its
execution for so long as such continuance is specifically approved with respect
to such Fund at least annually together with any related agreements, by votes of
a majority of both (a) the Board of Trustees of the Trust and (b) those Trustees
who are not "interested persons" of the Trust, as defined in the 1940 Act, and
who have no direct or indirect financial interest in the operation of this Plan
or any agreements related to it (the "Rule 12b-1 Trustees"), cast in person at a
meeting or meetings called for the purpose of voting on this Plan and such
related agreements; and only if the Trustees who approve the implementation or
continuation of the Plan have reached the conclusion required by Rule 12b-1(e)
under the 1940 Act.
5. Any person authorized to direct the disposition of monies paid or
payable by a Fund pursuant to this Plan or any related agreement shall provide
to the Trust's Board of Trustees and the Board shall review, at least quarterly,
a written report of the amounts so expended and the purposes for which such
expenditures were made.
6. This Plan may be terminated with respect to a Fund at any time by
vote of a majority of the Rule 12b-1 Trustees or by vote of a majority of the
outstanding voting securities of that Fund.
7. This Plan may not be amended to increase materially the amount of
fees to be paid by any Fund hereunder unless such amendment is approved by a
vote of at least a majority of the outstanding securities (as defined in the
1940 Act) of that Fund, and no material amendment to the Plan shall be made
unless such amendment is approved in the manner provided in Paragraph 4 hereof
for annual approval.
8. While this Plan is in effect, the selection and nomination of
Trustees who are not interested persons of the Trust, as defined in the 1940
Act, shall be committed to the discretion of Trustees who are themselves not
interested persons.
9. The Trust shall preserve copies of this Plan and any related
agreements for a period of not less than six years from the date of expiration
of the Plan or agreement, as the case may be, the first two years in an easily
accessible place; and shall preserve copies of each report made pursuant to
Paragraph 5 hereof for a period of not less than six years from the date of such
report, the first two years in an easily accessible place.
- 2 -
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this Plan Pursuant to Rule
12b-1 as of the day and year set forth below.
Date: ___________________________ NEUBERGER BERMAN EQUITY TRUST
Attest: By:________________________________
Name:
Title:
By: ___________________________
Agreed and assented to:
NEUBERGER BERMAN MANAGEMENT INC.
By:______________________________
Name:
Title:
- 3 -
<PAGE>
NEUBERGER BERMAN EQUITY TRUST
PLAN PURSUANT TO RULE 12b-1
SCHEDULE A
The series of Neuberger Berman Equity Trust subject to the Plan Pursuant
to 12b-1, and the applicable fee rates, are:
Fee (as a Percentage of
Series Average Daily Net Assets
------ ------------------------
Neuberger Berman Century Trust 0.10%
Neuberger Berman Focus Trust 0.10%
Neuberger Berman Genesis Trust 0.10%
Neuberger Berman Guardian Trust 0.10%
Neuberger Berman Millennium Trust 0.10%
Neuberger Berman Partners Trust 0.10%
Neuberger Berman Socially Responsive Trust 0.10%
- 4 -
<PAGE>
NEUBERGER BERMAN EQUITY FUNDS
NEUBERGER BERMAN EQUITY TRUST
NEUBERGER BERMAN EQUITY ASSETS
NEUBERGER BERMAN EQUITY SERIES
NEUBERGER BERMAN INCOME FUNDS
NEUBERGER BERMAN INCOME TRUST
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
October 31, 2000
This proxy is being solicited on behalf of the Boards of Trustees of Neuberger
Berman Equity Funds, Equity Trust, Equity Assets and Equity Series ("The Equity
Trusts") and relates to the proposals on behalf of the Century, Focus, Genesis,
Guardian, International, Manhattan, Millennium, Partners, Regency, Socially
Responsive and Technology series of The Equity Trusts (each a "Fund"). This
proxy is also being solicited on behalf of the Boards of Trustees of Neuberger
Berman Income Funds and Income Trust ("The Income Trusts") and relates to the
proposals on behalf of the Cash Reserves, Government Money, High Yield Bond,
Institutional Cash, Limited Maturity Bond, Municipal Money and Municipal
Securities series of The Income Trusts (each a "Fund"). The undersigned hereby
appoints as proxies Daniel J. Sullivan and Claudia A. Brandon, and each of them
(with power of substitution), to vote all shares of common stock of the
undersigned in the Funds at the Special Meeting of Shareholders to be held at
10:30 a.m., Eastern time, on October 31, 2000, at the offices of the Trust, 605
Third Avenue, 41st Floor, New York, NY 10158-3698, and any adjournment thereof
("Meeting"), with all the power the undersigned would have if personally
present.
The shares represented by this proxy will be voted as instructed. Unless
indicated to the contrary, this proxy shall be deemed to grant authority to vote
"FOR" all proposals set forth in this proxy statement relating to the Fund and
discretionary power to vote upon such other business as may properly come before
the Meeting.
YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWN.
IF YOU ARE NOT VOTING BY PHONE OR INTERNET, PLEASE SIGN AND DATE
THIS PROXY CARDAND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
VOTE TODAY BY MAIL,
TOUCH-TONE PHONE OR THE INTERNET
CALL TOLL-FREE 1-888-221-0697
OR LOG ON TO WWW.PROXYWEB.COM
<PAGE>
***Control Number: 999 999 999 999 99*** Please fold and detach card at
perforation before mailing
Please vote by checking the appropriate boxes below.
<TABLE>
<CAPTION>
Vote On Proposals FOR all nominees WITHHOLD
listed (except authority to
as market to the vote for all
contrary at left) nominees
<S> <C> <C>
_ _
1. To elect the nominees specified below as |_| |_|
Trustees to serve on the Board of Trustees
until their successors are duly elected and
qualified.
</TABLE>
All funds
(01) John Cannon (10) John T. Patterson, Jr.
(02) Faith Colish (11) John P. Rosenthal
(03) Walter G. Ehlers (12) William E. Rulon
(04) C. Anne Harvey (13) Cornelius T. Ryan
(05) Barry Hirsch (14) Tom Decker Seip
(06) Michael M. Kassen (15) Gustave H. Shubert
(07) Robert A. Kavesh (16) Candace L. Straight
(08) Howard A. Mileaf (17) Peter E. Sundman
(09) Edward I. O'Brien (18) Peter P. Trapp
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN
<S> <C> <C> <C>
_ _ _
2. To approve a change in the fundamental investment |_| |_| |_|
limitation regarding diversification.
All funds
_ _ _
3. Ratification of the selection of PricewaterhouseCoopers LLP |_| |_| |_|
as the Fund's Independent Accountants.
For Manhattan Millennium and Socially Responsive Fund,
Trust and Assets and Regency and Technology Fund and
Trust only
_ _ _
Ratification of the selection of Ernst & Young LLP as the |_| |_| |_|
Fund's Independent Auditors (for all other funds)
_ _ _
4. To approve an Agreement and Plan of Reorganization. |_| |_| |_|
Neuberger Berman Century Trust
<PAGE>
Neuberger Berman Focus Trust
Neuberger Berman Focus Assets
Neuberger Berman Genesis Trust
Neuberger Berman Genesis Assets
Neuberger Berman Genesis Institutional
Neuberger Berman Guardian Trust
Neuberger Berman Guardian Assets
Neuberger Berman Institutional Cash Trust
Neuberger Berman International Trust
Neuberger Berman Limited Maturity Bond Trust
Neuberger Berman Manhattan Trust
Neuberger Berman Manhattan Assets
Neuberger Berman Millennium Trust
Neuberger Berman Millennium Assets
Neuberger Berman Partners Trust
Neuberger Berman Partners Assets
Neuberger Berman Regency Trust
Neuberger Berman Socially Responsive Trust
Neuberger Berman Socially Responsive Assets
Neuberger Berman Technology Trust
_ _ _
5. To approve a distribution and shareholder services plan. |_| |_| |_|
Neuberger Berman Genesis Trust
Neuberger Berman Guardian Trust
Neuberger Berman Partners Trust
_ _ _
6. To approve a change in the fundamental restriction |_| |_| |_|
concerning industry concentration.
Neuberger Berman Cash Reserves
_ _ _
7. A. To modify the fundamental restriction limiting |_| |_| |_|
investments in U.S. Government securities.
_ _ _
B. To remove the fundamental prohibition on repurchase |_| |_| |_|
agreements.
_ _ _
C. To modify the fundamental borrowing policy to permit |_| |_| |_|
reverse repurchase agreements.
_ _ _
D. To modify the fundamental restriction to permit |_| |_| |_|
securities lending.
</TABLE>
Neuberger Berman Government Money
[NAME AND ADDRESS]
Please sign exactly as name appears hereon. If shares are held in the name of
joint owners, each should sign. Attorneys-in-fact, executors, administrators,
etc. should so indicate. If shareholder is a corporation or partnership, please
sign in full corporate or partnership name by authorized person.
<PAGE>
Date ______________________________, 2000
__________________________________________________
| |
| |
| |
|__________________________________________________|
Signature (owner, joint owners, trustee, custodian, etc.)
<PAGE>
NEUBERGER BERMAN EQUITY FUNDS
(INCLUDING THE CENTURY, FOCUS, GENESIS, GUARDIAN, INTERNATIONAL, MANHATTAN,
MILLENNIUM, PARTNERS, REGENCY, SOCIALLY RESPONSIVE AND TECHNOLOGY SERIES)
(EACH A "FUND")
NEUBERGER BERMAN INCOME FUNDS
(including the Cash Reserves, Government Money, High Yield Bond, Institutional
Cash, Limited Maturity Bond, Municipal Money and Municipal Securities series)
(EACH A "FUND")
605 THIRD AVENUE, 2ND FLOOR
NEW YORK, NEW YORK 10158-0180
STATEMENT OF ADDITIONAL INFORMATION
DATED AUGUST 15, 2000
This Statement of Additional Information ("SAI") relates specifically to
the reorganization of Neuberger Berman Equity Funds, Neuberger Berman Equity
Trust, Neuberger Berman Equity Assets, Neuberger Berman Equity Series, Neuberger
Berman Income Funds and Neuberger Berman Income Trust from a "master feeder"
structure" to a single-level, multiple-class structure. This Statement of
Additional Information is not a prospectus and should be read only in
conjunction with the Prospectus and Information Statement dated August 15, 2000
relating to the above-referenced matter. A copy of the Prospectus and
Information Statement may be obtained by calling Neuberger Berman Management
Inc. at 800-877-9700. This Statement of Additional Information consists of the
information set forth herein and the following described documents, each of
which is incorporated by reference herein (legally forms a part of the SAI):
(1) The audited financial statements of Neuberger Berman Income Funds
and Income Managers Trust and notes thereto for the fiscal year
ended October 31, 1999, and the reports of Ernst & Young LLP,
independent auditors, with respect to such audited financial
statements of Neuberger Berman CASH RESERVES and Portfolio,
Neuberger Berman GOVERNMENT MONEY Fund and Portfolio, Neuberger
Berman HIGH YIELD BOND Fund and Portfolio, and Neuberger Berman
LIMITED MATURITY BOND Fund and Portfolio, previously filed on
EDGAR, Accession Number 0000898432-99-001174.
(2) The unaudited financial statements of Neuberger Berman Income
Funds and Income Managers Trust and notes thereto for the
semi-annual period ended April 30, 2000, with respect to
Neuberger Berman CASH RESERVES and Portfolio, Neuberger Berman
GOVERNMENT MONEY Fund and Portfolio, Neuberger Berman HIGH YIELD
BOND Fund and Portfolio, and Neuberger Berman LIMITED MATURITY
BOND Fund and Portfolio, previously filed on EDGAR, Accession
Number 0000898432-000465.
(3) The audited financial statements of Neuberger Berman Income Funds
and Income Managers Trust and notes thereto for the fiscal year
<PAGE>
ended October 31, 1999, and the reports of Ernst & Young LLP,
independent auditors, with respect to such audited financial
statements of Neuberger Berman MUNICIPAL MONEY FUND and Portfolio
and Neuberger Berman MUNICIPAL SECURITIES Trust and Portfolio,
previously filed on EDGAR, Accession Number 0000898432-99-001176.
(4) The unaudited financial statements of Neuberger Berman Income
Funds and Income Managers Trust and notes thereto for the
semi-annual period ended April 30, 2000, with respect to
Neuberger Berman MUNICIPAL MONEY FUND and Portfolio and Neuberger
Berman MUNICIPAL SECURITIES Trust and Portfolio, previously filed
on EDGAR, Accession Number 0000898432-00-000466.
(5) The audited financial statements of Neuberger Berman Income Trust
and Income Managers Trust and notes thereto for the fiscal year
ended October 31, 1999, and the reports of Ernst & Young LLP,
independent auditors, with respect to such audited financial
statements of Neuberger Berman LIMITED MATURITY BOND Trust and
Portfolio, previously filed on EDGAR, Accession Number
0000898432-99-000709.
(6) The unaudited financial statements of Neuberger Berman Income
Trust and Income Managers Trust and notes thereto for the
semi-annual period ended April 30, 2000, with respect to
Neuberger Berman LIMITED MATURITY BOND Trust and Portfolio,
previously filed on EDGAR, Accession Number 0000898432-00-000467.
(7) The audited financial statements of Neuberger Berman Equity Funds
and Equity Managers Trust and notes thereto for the fiscal year
ended August 31, 1999, and the reports of Ernst & Young LLP,
independent auditors, with respect to such audited financial
statements of Neuberger Berman GENESIS Fund and Portfolio,
Neuberger Berman GUARDIAN Fund and Portfolio, Neuberger Berman
PARTNERS Fund and Portfolio, Neuberger Berman FOCUS Fund and
Portfolio, and Neuberger Berman INTERNATIONAL Fund; the report of
Ernst & Young, independent auditors, with respect to such audited
financial statements of Neuberger Berman INTERNATIONAL Portfolio;
and the reports of PricewaterhouseCoopers LLP, independent
accountants, with respect to such audited financial statements of
Neuberger Berman MANHATTAN Fund and Portfolio, Neuberger Berman
REGENCY Fund and Portfolio, Neuberger Berman MILLENNIUM Fund and
Portfolio, and Neuberger Berman SOCIALLY RESPONSIVE Fund and
Portfolio, previously filed on EDGAR, Accession Number
0000898432-99-001011.
(8) The unaudited financial statements of Neuberger Berman Equity
Funds and Equity Managers Trust and notes thereto for the
semi-annual period ended February 29, 2000, with respect to
Neuberger Berman GENESIS Fund and Portfolio, Neuberger Berman
GUARDIAN Fund and Portfolio, Neuberger Berman PARTNERS Fund and
Portfolio, Neuberger Berman FOCUS Fund and Portfolio, and
Neuberger Berman INTERNATIONAL Fund and Portfolio, Neuberger
Berman MANHATTAN Fund and Portfolio, Neuberger Berman REGENCY
Fund and Portfolio, Neuberger Berman MILLENNIUM Fund and
Portfolio, and Neuberger Berman SOCIALLY RESPONSIVE Fund and
Portfolio, previously filed on EDGAR, Accession Number
0000898432-00-000338.
2
<PAGE>
(9) The audited financial statements of Neuberger Berman Equity Trust
and Equity Managers Trust and notes thereto for the fiscal year
ended August 31, 1999, and the reports of Ernst & Young LLP,
independent auditors, with respect to such audited financial
statements of Neuberger Berman GENESIS Trust and Portfolio,
Neuberger Berman FOCUS Trust and Portfolio, Neuberger Berman
GUARDIAN Trust and Portfolio, Neuberger Berman PARTNERS Trust and
Portfolio, and Neuberger Berman International Trust; the report
of Ernst & Young, independent auditors, with respect to such
audited financial statements of Neuberger Berman INTERNATIONAL
Portfolio; and the reports of PricewaterhouseCoopers LLP,
independent accountants, with respect to such audited financial
statements of Neuberger Berman MANHATTAN Trust and Portfolio,
Neuberger Berman REGENCY Trust and Portfolio, Neuberger Berman
MILLENNIUM Trust and Portfolio and Neuberger Berman SOCIALLY
RESPONSIVE Trust and Portfolio, previously filed on EDGAR,
Accession Number 0000898432-99-001008.
(10) The unaudited financial statements of Neuberger Berman Equity
Trust and Equity Managers Trust and notes thereto for the
semi-annual period ended February 29, 2000, with respect to
Neuberger Berman GENESIS Trust and Portfolio, Neuberger Berman
FOCUS Trust and Portfolio, Neuberger Berman GUARDIAN Trust and
Portfolio, Neuberger Berman PARTNERS Trust and Portfolio, and
Neuberger Berman INTERNATIONAL Trust and Portfolio, Neuberger
Berman MANHATTAN Trust and Portfolio, Neuberger Berman REGENCY
Trust and Portfolio, Neuberger Berman MILLENNIUM Trust and
Portfolio and Neuberger Berman SOCIALLY RESPONSIVE Trust and
Portfolio, previously filed on EDGAR, Accession Number
0000898432-00-000340.
(11) The audited financial statements of Neuberger Berman Equity
Assets and Equity Managers Trust and notes thereto for the fiscal
year ended August 31, 1999, and the reports of Ernst & Young LLP,
independent auditors, with respect to such audited financial
statements of Neuberger Berman FOCUS Assets and Portfolio,
Neuberger Berman GENESIS Assets and Portfolio and Neuberger
Berman GUARDIAN Assets and Portfolio, and Neuberger Berman
PARTNERS Assets and Portfolio, and the report of
PricewaterhouseCoopers LLP, independent accountants, with respect
to such audited financial statements of Neuberger Berman
MANHATTAN Assets and Portfolio, Neuberger Berman MILLENNIUM
Assets and Portfolio, Neuberger Berman SOCIALLY RESPONSIVE Assets
and Portfolio, previously filed on EDGAR, Accession Number
0000898432-99-001010.
(12) The unaudited financial statements of Neuberger Berman Equity
Assets and Equity Managers Trust and notes thereto for the
semi-annual period ended February 29, 2000, with respect to
Neuberger Berman FOCUS Assets and Portfolio, Neuberger Berman
GENESIS Assets and Portfolio and Neuberger Berman GUARDIAN Assets
and Portfolio, Neuberger Berman PARTNERS Assets and Portfolio,
Neuberger Berman MANHATTAN Assets and Portfolio, Neuberger Berman
MILLENNIUM Assets and Portfolio, Neuberger Berman SOCIALLY
RESPONSIVE Assets and Portfolio, previously filed on EDGAR,
Accession Number 0000898432-00-000339.
3
<PAGE>
(13) The audited financial statements of Neuberger Berman Genesis
Institutional (a series of Neuberger Berman Equity Series) and
Neuberger Berman Genesis Portfolio (as series of Equity Mangers
Trust) and notes thereto for the fiscal year ended August 31,
1999, and the reports of Ernst & Young LLP, independent auditors,
with respect to such audited financial statements, previously
filed on EDGAR, Accession Number 0000898432-99-001012.
(14) The unaudited financial statements of Neuberger Berman Genesis
Institutional (a series of Neuberger Berman Equity Series) and
Neuberger Berman Genesis Portfolio (as series of Equity Managers
Trust) and notes thereto for the semi-annual period ended
February 29, 2000, previously filed on EDGAR, Accession Number
0000898432-00-000337.
(15) The Statement of Additional Information of Neuberger Berman
Income Funds, dated March 1, 2000, previously filed on EDGAR,
Accession Number 0000898432-00-000182. The Statement of
Additional Information of Neuberger Berman Institutional Cash
Fund, dated March 1, 2000, previously filed on EDGAR, Accession
Number 0000898432-00-000312.
(16) The Statement of Additional Information of Neuberger Berman
Equity Funds, dated December 1, 1999, as amended on May 1, 2000,
previously filed on EDGAR, Accession Number 0000898432-99-000157
and 0000898432-00-000139, respectively. The Statement of
Additional Information of Neuberger Berman Technology Fund,
previously filed on EDGAR, Accession Number 0000898432-00-000304.
4
<PAGE>
CENTURY PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
FEBRUARY 29, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET VALUE
(000'S OMITTED)
AS REPORTED PRO FORMA
-------------------------------
NUMBER OF SHARES/PRINCIPAL EQUITY FUNDS- EQUITY TRUST- ENTURY FUND
AMOUNT CENTURY FUND CENTURY TRUST ADJUSTMENTS (A) CENTURY FUND
------------------------------
<S> <C> <C> <C> <C>
Investment in Portfolio $28,829 $2,137 $(30,966) $ 0
Investment in unaffiliated issuers and
non-controlled affiliated issuers
COMMON STOCKS (94.2%)
CAPITAL GOODS (4.2%)
7,100 General Electric $ 938 $ 938
7,700 Honeywell International 371 371
--------------- ---------------
1,309 1,309
--------------- ---------------
COMMUNICATIONS (16.7%)
9,500 Cabletron Systems 466 466
6,800 Cisco Systems 899 899
2,500 Comverse Technology 492 492
1,600 JDS Uniphase 422 422
3,000 Motorola, Inc. 511 511
2,100 Nextel Communications 287 287
3,300 Nokia Corp. ADR 654 654
4,312 NTL Inc. 395 395
3,100 QUALCOMM Inc. 442 442
13,200 Qwest Communications International 612 612
--------------- ---------------
5,180 5,180
--------------- ---------------
CONSUMER CYCLICALS (3.8%)
7,400 AMFM Inc. 454 454
3,700 EchoStar Communications 422 422
4,400 Harley-Davidson 300 300
--------------- ---------------
1,176 1,176
--------------- ---------------
<PAGE>
CONSUMER STAPLES (6.9%)
8,900 AT&T Corp.- Liberty Media Group Class A 465 465
11,700 Comcast Corp. Class A Special 497 497
8,800 Kimberly-Clark 455 455
1,200 SONY CORP. ADR 376 376
4,100 Time Warner 351 351
--------------- ---------------
2,144 2,144
--------------- ---------------
ELECTRICAL EQUIPMENT (8.9%)
3,700 Agilent Technologies 384 384
3,300 Analog Devices 518 518
2,700 Applied Materials 494 494
1,600 Broadcom Corp. 316 316
4,800 Conexant Systems 471 471
3,400 Texas Instruments 566 566
--------------- ---------------
2,749 2,749
--------------- ---------------
ENERGY (3.2%)
7,500 Enron Corp. 517 517
6,400 Schlumberger Ltd. 473 473
--------------- ---------------
990 990
--------------- ---------------
FINANCIAL SERVICES (4.2%)
6,200 Capital One Financial 228 228
9,700 Citigroup Inc. 501 501
5,500 Merrill Lynch 564 564
--------------- ---------------
1,293 1,293
--------------- ---------------
FOOD & TOBACCO (1.6%)
7,700 Anheuser-Busch 494 494
--------------- ---------------
HARDWARE (7.7%)
4,800 EMC Corp. 571 571
6,300 Flextronics International 383 383
2,800 Hewlett-Packard 377 377
3,400 Sanmina Corp. 398 398
6,800 Sun Microsystems 648 648
--------------- ---------------
2,377 2,377
--------------- ---------------
HEALTH CARE (7.2%)
10,800 Amgen, Inc. 737 737
3,300 Biogen, Inc. 356 356
2,500 Genentech, Inc. 482 482
1,100 MedImmune, Inc. 218 218
5,100 Warner-Lambert 437 437
--------------- ---------------
2,230 2,230
--------------- ---------------
<PAGE>
INTERNET (8.7%)
7,500 America Online 443 443
3,700 DoubleClick Inc. 329 329
4,100 eSPEED, Inc. 254 254
300 FreeMarkets, Inc. 52 52
11,300 Intuit Inc. 593 593
2,900 Safeguard Scientifics 507 507
3,150 Yahoo! Inc. 503 503
--------------- ---------------
2,681 2,681
--------------- ---------------
RETAIL (4.8%)
7,800 Home Depot 451 451
6,800 Tiffany & Co. 436 436
12,200 Wal-Mart Stores 594 594
--------------- ---------------
1,481 1,481
--------------- ---------------
SOFTWARE (10.1%)
4,600 Citrix Systems 485 485
10,200 Microsoft Corp. 911 911
11,500 Oracle Corp. 854 854
10,600 Peregrine Systems 579 579
4,300 Rational Software 306 306
--------------- ---------------
3,135 3,135
--------------- ---------------
TELECOMMUNICATIONS (6.2%)
9,900 MCI WorldCom 442 442
4,300 Metromedia Fiber Network 309 309
9,000 Nextel Partners 288 288
5,900 Nortel Networks 658 658
1,750 VoiceStream Wireless 233 233
--------------- ---------------
1,930 1,930
--------------- ---------------
TOTAL COMMON STOCKS (COST $25,788) 29,169 29,169
--------------- ---------------
Principal
Amount
------------------------------
U.S. GOVERNMENT AGENCY SECURITIES (5.2%)
$ 1,600,000 Federal Home Loan Bank, Discount Notes,
5.72%, due 3/1/00 (COST $1,600) 1,600 1,600
--------------- ---------------
<PAGE>
REPURCHASE AGREEMENTS (3.6%)
1,101,000 State Street Bank and Trust Co. Repurchase
Agreement, 5.71%, due 3/1/00, dated
2/29/00, Maturity Value $1,101,175,
Collateralized by $1,130,000 Fannie Mae,
Notes, 6.40%, due 9/27/01 (Collateral
Value $1,135,718) (COST $1,101) 1,101 1,101
--------------- ---------------
SHORT-TERM INVESTMENTS (8.0%)
2,493,268 N&B Securities Lending Quality Fund, LLC
(COST $2,493) 2,493 2,493
--------------- ---------------
TOTAL INVESTMENTS (111.0%) (COST $30,982) $ 34,363 $ 34,363
=============== ===============
</TABLE>
(a) The proposed reorganization contemplates the merger of the funds and the
redemption in kind of the surviving fund's interest in the Century Portfolio.
Because liabilities exceeded assets other than Investments at the Portfolio
level, certain of the investments being transferred would have been liquidated.
<PAGE>
FOCUS PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
AUGUST 31, 1999 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET VALUE
(000'S OMITTED)
AS REPORTED PRO FORMA
--------------------------
EQUITY EQUITY
NUMBER OF TRUST- ASSETS-
SHARES/PRINCIPAL EQUITY FUNDS- FOCUS FOCUS
AMOUNT FOCUS FUND TRUST ASSETS ADJUSTMENTS (a) FOCUS FUND
---------------------
<S> <C> <C> <C> <C> <C>
Investment in Portfolio $1,327,814 $216,696 $1,888 $(1,546,398) $0
Investment in unaffiliated
issuers and non-controlled
affiliated issuers
COMMON STOCKS (96.6%)
AUTOMOTIVE (3.0%)
705,000 General Motors $ 46,618 $ 46,618
--------------- -------------
FINANCIAL SERVICES (47.1%)
833,000 Bank One 33,424 33,424
1,090,000 BankBoston Corp. 50,617 50,617
2,767,500 Capital One Financial 104,473 104,473
1,355,000 Chase Manhattan 113,397 113,397
3,183,375 Citigroup Inc. 141,461 141,461
2,381,000 Countrywide Credit Industries 76,490 76,490
560,000 Hartford Financial Services
Group 25,445 25,445
1,025,000 Morgan Stanley Dean Witter 87,958 87,958
<PAGE>
568,700 Nationwide Financial Services 20,758 20,758
390,000 Providian Financial 30,274 30,274
1,243,000 Travelers Property Casualty 44,126 44,126
--------------- -------------
728,423 728,423
--------------- -------------
HEALTH CARE (6.4%)
1,865,990 Foundation Health Systems 23,791 23,791
1,040,000 Wellpoint Health Networks 75,790 75,790
--------------- -------------
99,581 99,581
--------------- -------------
RETAIL (10.8%)
1,800,000 Furniture Brands International 36,113 36,113
1,638,400 Jones Apparel Group 42,496 42,496
1,048,700 Kmart Corp. 13,174 13,174
345,000 Payless ShoeSource 17,207 17,207
995,000 Promus Hotel 28,917 28,917
1,525,000 Sterling Commerce 29,166 29,166
--------------- -------------
167,073 167,073
--------------- -------------
TECHNOLOGY (29.3%)
1,380,000 3Com Corp. 34,241 34,241
1,200,000 Atmel Corp. 47,175 47,175
504,000 Autodesk, Inc. 11,592 11,592
657,000 BMC Software 35,355 35,355
1,185,000 Compaq Computer 27,477 27,477
2,594,800 Compuware Corp. 78,331 78,331
175,000 Lattice Semiconductor 10,784 10,784
605,000 Microchip Technology 33,124 33,124
1,150,000 Oracle Corp. 41,975 41,975
1,302,500 Photronics, Inc. 31,097 31,097
1,795,000 Rational Software 48,577 48,577
495,000 Tech Data 18,346 18,346
<PAGE>
420,000 Texas Instruments 34,466 34,466
--------------- -------------
452,540 452,540
--------------- -------------
TOTAL COMMON STOCKS (COST
$987,085) 1,494,235 1,494,235
--------------- -------------
Principal
Amount
---------------------
REPURCHASE AGREEMENTS (1.5%)
$22,890,000 State Street Bank and Trust Co.
Repurchase Agreement, 5.25%,
due 9/1/99, dated 8/31/99,
Maturity Value $22,893,338,
Collateralized by $22,645,000
U.S. Treasury Bonds, 8.25%,
due 5/15/05 (Collateral Value
$23,579,106) (COST $22,890) 22,890 22,890
--------------- -------------
SHORT-TERM INVESTMENTS (0.5%)
7,114,402 N&B Securities Lending Quality
Fund, LLC (COST $7,114) 7,114 7,114
--------------- -------------
TOTAL INVESTMENTS (98.6%) (COST
$1,017,089) $ 1,524,239 $ 1,524,239
=============== =============
</TABLE>
(a) The proposed reorganization contemplates the merger of the funds and the
redemption in kind of the surviving fund's interest in the Focus Portfolio.
<PAGE>
GENESIS PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
AUGUST 31, 1999 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET VALUE
(000'S OMITTED)
AS REPORTED PRO FORMA
--------------------------------------------------
EQUITY FUNDS- EQUITY EQUITY EQUITY ADJUSTMENTS (A)
NUMBER OF GENESIS FUND TRUST- ASSETS- SERIES-
SHARES/PRINCIPAL GENESIS GENESIS GENESIS
AMOUNT TRUST ASSETS INSTITUTIONAL GENESIS FUND
---------------------
<S> <C> <C> <C> <C> <C> <C>
Investment in Portfolio $848,098 $597,219 $81,781 $224,006 $ (1,751,104) $ 0
Investment in unaffiliated
issuers and non-controlled
affiliated issuers
COMMON STOCKS (96.5%)
AEROSPACE (6.7%)
1,771,350 AAR Corp. $ 37,863 $ 37,863
1,219,500 Aviall Inc. 13,567 13,567
658,700 Cordant Technologies 27,254 27,254
478,300 DONCASTERS PLC ADR 6,636 6,636
299,850 Ducommun Inc. 3,598 3,598
205,400 Howmet International 3,672 3,672
425,000 Ladish Co. 2,975 2,975
344,700 Moog, Inc. Class A 11,289 11,289
471,500 Orbital Sciences 10,461 10,461
--------------- -------------
117,315 117,315
--------------- -------------
<PAGE>
AUTOMOTIVE (0.7%)
607,200 Donaldson Co. 11,916 11,916
--------------- -------------
BANKING & FINANCIAL (7.2%)
534,200 Bank United 18,330 18,330
573,100 Community First Bankshares 11,766 11,766
667,600 Cullen/Frost Bankers 17,441 17,441
331,400 Highland Bancorp 6,172 6,172
291000 Ocean Financial 5,202 5,202
1,008,300 Peoples Heritage Financial Group 16,952 16,952
116,212 Queens County Bancorp 3,196 3,196
726,675 Sterling Bancshares 8,720 8,720
300,350 Texas Regional Bancshares 7,678 7,678
--------------- -------------
1,163,400 Webster Financial 126,796 126,796
--------------- -------------
BASIC MATERIALS (0.5%)
230,200 Lone Star Industries 7,913 7,913
--------------- -------------
BUILDING, CONSTRUCTION & FURNISHING (1.1%)
294,800 Lincoln Electric Holdings 5,970 5,970
273,600 Simpson Manufacturing 14,090 14,090
--------------- -------------
20,060 20,060
--------------- -------------
BUSINESS SERVICES (3.0%)
1,075,600 Davox Corp. 14,991 14,991
343,500 Fair, Isaac & Co. 9,704 9,704
418,300 Navigant Consulting 18,353 18,353
209,000 Valassis Communications 9,144 9,144
--------------- -------------
52,192 52,192
--------------- -------------
<PAGE>
CONSUMER CYCLICALS (0.4%)
417,600 Coachmen Industries 6,603 6,603
--------------- -------------
CONSUMER PRODUCTS & SERVICES (5.7%)
801,000 Alberto-Culver Class A 17,272 17,272
530,637 Block Drug 21,325 21,325
101,800 Bush Boake Allen 2,653 2,653
521,300 Church & Dwight 24,241 24,241
349,800 Matthews International 9,488 9,488
1,086,800 Ruddick Corp. 20,174 20,174
462,000 The First Years 4,995 4,995
--------------- -------------
100,148 100,148
--------------- -------------
DEFENSE (6.1%)
663,200 Alliant Techsystems 48,414 48,414
1,309,100 Newport News Shipbuilding 41,155 41,155
800,400 Primex Technologies 16,708 16,708
--------------- -------------
106,277 106,277
--------------- -------------
DIAGNOSTIC EQUIPMENT (0.3%)
906,500 ADAC Laboratories 5,326 5,326
--------------- -------------
ELECTRONICS (4.9%)
456,900 Benchmark Electronics 16,820 16,820
951,900 Dallas Semiconductor 48,071 48,071
289,800 Etec Systems 12,751 12,751
172,100 SCI Systems 8,573 8,573
--------------- -------------
86,215 86,215
--------------- -------------
ENERGY (1.8%)
692,300 Cabot Oil & Gas 13,197 13,197
<PAGE>
150,000 Cross Timbers Oil 1,856 1,856
808,290 Swift Energy 10,205 10,205
875,800 Unit Corp. 6,733 6,733
--------------- -------------
31,991 31,991
--------------- -------------
HEALTH CARE (9.8%)
977,800 Acuson Corp. 15,400 15,400
174,600 Arrow International 5,063 5,063
275,400 CONMED Corp. 7,711 7,711
709,000 DENTSPLY International 17,592 17,592
1,207,900 Haemonetics Corp. 23,630 23,630
885,300 Mentor Corp. 20,694 20,694
389,950 Patterson Dental 15,988 15,988
275,000 Respironics, Inc. 2,733 2,733
503,700 STAAR Surgical 5,981 5,981
940,700 Trigon Healthcare 34,159 34,159
679,600 Universal Health Services
Class B 22,682 22,682
--------------- -------------
171,633 171,633
--------------- -------------
INDUSTRIAL & COMMERCIAL PRODUCTS & SERVICES (7.2%)
356,300 BMC Industries 4,387 4,387
474,900 Brady Corp. 14,247 14,247
282,000 Dionex Corp. 11,227 11,227
1,261,300 Hussmann International 21,442 21,442
369,700 IDEX Corp. 10,929 10,929
770,200 Kaydon Corp. 23,636 23,636
183,100 Roper Industries 6,557 6,557
814,400 SOS Staffing Services 4,835 4,835
1,247,400 Wallace Computer Services 26,663 26,663
203,750 Woodhead Industries 2,248 2,248
--------------- -------------
126,171 126,171
--------------- -------------
<PAGE>
INSURANCE (3.5%)
910,200 Annuity and Life Re 20,138 20,138
660,800 FBL Financial Group 13,092 13,092
857,900 Scottish Annuity & Life
Holdings 8,365 8,365
858,700 W. R. Berkley 19,535 19,535
--------------- -------------
61,130 61,130
--------------- -------------
LODGING (0.5%)
846,000 Prime Hospitality 7,878 7,878
--------------- -------------
MACHINERY & EQUIPMENT (0.8%)
686,600 Gardner Denver Machinery 13,174 13,174
--------------- -------------
OFFICE EQUIPMENT (1.7%)
1,350,900 United Stationers 30,564 30,564
--------------- -------------
OIL SERVICES (9.5%)
390,700 Cal Dive International 14,700 14,700
748,600 Friede Goldman International 9,170 9,170
1,018,800 Global Industries 11,398 11,398
938,100 IRI International 4,397 4,397
619,500 Nabors Industries 16,843 16,843
1,538,712 National-Oilwell 26,158 26,158
793,400 Oceaneering International 15,918 15,918
781,600 Offshore Logistics 9,135 9,135
777,300 Pride International 11,562 11,562
579,400 Smith International 27,051 27,051
636,000 Tuboscope Inc. 9,262 9,262
513,200 UTI Energy 10,264 10,264
--------------- -------------
165,858 165,858
--------------- -------------
<PAGE>
PACKING & CONTAINERS (2.1%)
1,450,100 AptarGroup Inc. 37,340 37,340
--------------- -------------
PUBLISHING & BROADCASTING (2.2%)
155,239 Hearst-Argyle Television 3,929 3,929
329,300 Houghton Mifflin 15,724 15,724
467,100 Meredith Corp. 16,203 16,203
78,866 Pulitzer Inc. 3,455 3,455
--------------- -------------
39,311 39,311
--------------- -------------
RESTAURANTS (1.2%)
890,050 Brinker International 21,361 21,361
--------------- -------------
RETAILING (2.7%)
527,968 99 Cents Only Stores 19,007 19,007
471,600 Claire's Stores 8,872 8,872
340,000 ShopKo Stores 9,732 9,732
273,800 Whole Foods Market 9,840 9,840
--------------- -------------
47,451 47,451
--------------- -------------
TECHNOLOGY (8.0%)
798,700 Analysts International 10,683 10,683
242,000 Black Box 11,102 11,102
543,600 CACI International 12,231 12,231
2,201,600 Inprise Corp. 9,288 9,288
322,400 Jack Henry & Associates 10,478 10,478
250,000 Keane, Inc. 5,422 5,422
1,507,500 Methode Electronics Class A 27,135 27,135
1,009,900 Wind River Systems 16,095 16,095
812,500 Zebra Technologies 38,187 38,187
--------------- -------------
140,621 140,621
--------------- -------------
<PAGE>
TRANSPORTATION, SHIPPING & FREIGHT (0.7%)
232,900 Air Express International 5,692 5,692
190,900 Circle International Group 4,725 4,725
213,600 Maritrans Inc. 1,081 1,081
--------------- -------------
11,498 11,498
--------------- -------------
UTILITIES, ELECTRIC & GAS (8.2%)
834,700 AGL Resources 15,077 15,077
326,000 Atmos Energy 8,170 8,170
282,500 Central Hudson Gas & Electric 11,936 11,936
190,200 Connecticut Energy 7,109 7,109
144,300 Eastern Enterprises 6,484 6,484
855,200 Montana Power 26,458 26,458
173,000 National Fuel Gas 8,142 8,142
180,300 NICOR Inc. 6,975 6,975
345,900 NUI Corp. 8,864 8,864
283,100 ONEOK, Inc. 8,794 8,794
213,500 Otter Tail Power 8,500 8,500
766,784 Sierra Pacific Resources 18,690 18,690
290,000 Washington Gas Light 7,739 7,739
--------------- -------------
142,938 142,938
--------------- -------------
TOTAL COMMON STOCKS (COST
$1,548,759) 1,689,680 1,689,680
--------------- -------------
<PAGE>
Principal
Amount
---------------------
REPURCHASE AGREEMENTS (1.5%)
$26,740,000 State Street Bank and Trust
Co. Repurchase Agreement,
5.25%, due 9/1/99, dated
8/31/99, Maturity Value
$26,743,900, Collateralized
by $27,405,000 U.S. Treasury
Notes, 5.875%, due 2/15/00
(Collateral Value
$27,543,505) (COST $26,740) 26,740 26,740
--------------- -------------
SHORT-TERM INVESTMENTS (3.6%)
10,000,000 American Express Credit Corp.,
5.13%, due 9/3/99 9,997 9,997
10,000,000 General Electric Capital
Corp., 5.23%, due 9/8/99 9,990 9,990
42,524,723 N&B Securities Lending Quality
Fund, LLC 42,525 42,525
--------------- -------------
TOTAL SHORT-TERM INVESTMENTS
(COST $62,512) 62,512 62,512
--------------- -------------
TOTAL INVESTMENTS (101.6%)
(COST $1,638,011) $ 1,778,932 $ 1,778,932
=============== =============
</TABLE>
(a) The proposed reorganization contemplates the merger of the funds and the
redemption in kind of the surviving fund's interest in the Genesis Portfolio.
<PAGE>
<TABLE>
<CAPTION>
GUARDIAN PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF
INVESTMENTS
AUGUST 31, 1999 (UNAUDITED)
MARKET VALUE
(000'S
OMITTED)
AS REPORTED PRO FORMA
---------------------------------------
EQUITY EQUITY EQUITY
NUMBER OF FUNDS- TRUST- ASSETS-
SHARES/PRINCIPAL GUARDIAN GUARDIAN GUARDIAN GUARDIAN
AMOUNT FUND TRUST ASSETS ADJUSTMENTS(a) FUND
----------------
<S> <C> <C> <C> <C> <C>
Investment in Portfolio $3,446,910 $ 1,251,954 $ 24,856 $ (4,723,720) $ 0
Investment in
unaffiliated issuers
and non-controlled
affiliated issuers
COMMON STOCKS (86.0%)
BANKING & FINANCIAL (7.9%)
792,400 Bank of America $ 47,940 $ 47,940
1,400,800 BankBoston Corp. 65,049 65,049
1,576,100 Chase Manhattan 131,900 131,900
3,174,500 Wells Fargo 126,385 126,385
-------------- ---------------
371,274 371,274
-------------- ---------------
BASIC MATERIALS (3.5%)
2,996,000 Cabot Corp. 69,095 69,095
367,500 International Paper 17,295 17,295
1,340,200 Lyondell Chemical 19,517 19,517
2,603,600 Millennium Chemicals 59,883 59,883
-------------- ---------------
165,790 165,790
-------------- ---------------
<PAGE>
CAPITAL GOODS (2.8%)
425,700 Emerson Electric 26,659 26,659
4,176,800 Republic Services 45,423 45,423
1,227,900 SCI Systems 61,165 61,165
-------------- ---------------
133,247 133,247
-------------- ---------------
COMMUNICATION SERVICES (6.4%)
1,818,000 AT&T Corp. 81,810 81,810
1,214,700 Bell Atlantic 74,401 74,401
1,957,100 MCI WorldCom 148,250 148,250
-------------- ---------------
304,461 304,461
-------------- ---------------
CONSUMER CYCLICALS (7.3%)
479,100 Carnival Corp. 21,410 21,410
4,123,100 Cendant Corp. 73,958 73,958
Federated Department
525,000 Stores 24,150 24,150
976,400 General Motors 64,564 64,564
2,077,600 Lear Corp. 83,494 83,494
893,200 Lowe's Cos. 40,417 40,417
3,545,300 Office Depot 37,004 37,004
-------------- ---------------
344,997 344,997
-------------- ---------------
CONSUMER STAPLES (5.7%)
1,106,300 AMFM Inc. 54,485 54,485
1,715,500 Kimberly-Clark 97,676 97,676
1,378,600 McDonald's Corp. 57,040 57,040
1,620,000 Philip Morris 60,649 60,649
-------------- ---------------
269,850 269,850
-------------- ---------------
ENERGY (9.0%)
868,500 Amerada Hess 53,901 53,901
356,400 Chevron Corp. 32,878 32,878
602,400 Diamond Offshore
Drilling 23,042 23,042
1,070,400 Halliburton Co. 49,640 49,640
680,100 Mobil Corp. 69,625 69,625
<PAGE>
390,500 Royal Dutch Petroleum -
NY Shares 24,162 24,162
441,400 Schlumberger Ltd. 29,464 29,464
787,400 Texaco Inc. 50,000 50,000
627,700 Transocean Offshore 21,342 21,342
3,843,700 Union Pacific
Resources Group 68,946 68,946
-------------- ---------------
423,000 423,000
-------------- ---------------
FINANCIAL SERVICES (15.6%)
270,000 American International Group 25,026 25,026
1,327,300 Associates First Capital 45,543 45,543
3,470,800 Capital One Financial 131,023 131,023
1,913,300 Citigroup Inc. 85,022 85,022
5,175,900 Conseco, Inc. 124,222 124,222
1,162,900 Countrywide Credit Industries 37,358 37,358
1,658,200 Hartford Financial Services
Group 75,344 75,344
3,067,100 IndyMac Mortgage Holdings 41,214 41,214
579,500 Morgan Stanley Dean Witter 49,728 49,728
502,100 Progressive Corp. 51,214 51,214
1,576,000 SLM Holding 69,640 69,640
-------------- ---------------
735,334 735,334
-------------- ---------------
HEALTH CARE (9.3%)
1,801,200 Aetna Inc. 140,043 140,043
2,249,200 American Home Products 93,342 93,342
98,064 PacifiCare Health Systems 5,884 5,884
200,000 Warner-Lambert 13,250 13,250
2,582,996 Wellpoint Health Networks 188,236 188,236
-------------- ---------------
440,755 440,755
-------------- ---------------
TECHNOLOGY (15.8%)
230,000 Apple Computer 15,008 15,008
1,160,200 Computer Associates 65,551 65,551
975,000 Compuware Corp. 29,433 29,433
381,200 Gateway Inc. 36,953 36,953
678,300 Hewlett-Packard 71,476 71,476
<PAGE>
829,000 IBM 103,262 103,262
734,100 Micron Technology 54,736 54,736
560,000 Nortel Networks 22,995 22,995
1,728,700 Rational Software 46,783 46,783
1,366,700 Seagate Technology 45,357 45,357
699,700 Sun Microsystems 55,626 55,626
469,500 Teradyne, Inc. 31,955 31,955
832,400 Texas Instruments 68,309 68,309
2,097,800 Xerox Corp. 100,170 100,170
-------------- ---------------
747,614 747,614
-------------- ---------------
TRANSPORTATION (2.7%)
962,200 AMR Corp. 56,409 56,409
1,031,600 Santa Fe Burlington Northern 29,916 29,916
1,005,000 Class B Continental Airlines 41,017 41,017
-------------- ---------------
127,342 127,342
-------------- ---------------
TOTAL COMMON
STOCKS (COST
$3,473,802) 4,063,664 4,063,664
-------------- ---------------
PREFERRED STOCKS (1.6%)
2,878,900 News Corp. ADR (COST $76,136) 76,111 76,111
-------------- ---------------
PRINCIPAL AMOUNT
-------------------
U.S. TREASURY SECURITIES (1.0%)
$50,000,000 U.S. Treasury Bills, 4.60%,
due 11/18/99 (COST $49,502) 49,502 49,502
-------------- ---------------
U.S. GOVERNMENT AGENCY SECURITIES (1.1%)
50,000,000 Federal Home Loan Bank, Discount
Notes, 5.40%, due 9/1/99
(COST $50,000) 50,000 50,000
-------------- ---------------
<PAGE>
REPURCHASE AGREEMENTS (2.4%)
$50,000,000 State Street Bank and Trust Co.
Repurchase Agreement, 5.25%,
due 9/1/99, dated 8/31/99,
Maturity Value $50,007,292,
Collateralized by $47,855,000
U.S. Treasury Bonds, 7.875%,
due 11/15/07 (Collateral Value
$51,503,944) 50,000 50,000
50,000,000 State Street Bank and Trust Co.
Repurchase Agreement, 5.25%,
due 9/1/99, dated 8/31/99,
Maturity Value $50,007,292,
Collateralized by $45,880,000
U.S. Treasury Bonds, 7.50%,
due 11/15/16 (Collateral Value
$51,500,300) 50,000 50,000
11,170,000 State Street Bank and Trust Co.
Repurchase Agreement, 5.25%,
due 9/1/99, dated 8/31/99,
Maturity Value $11,171,629,
Collateralized by $11,270,000
U.S. Treasury Notes, 7.750%,
due 12/31/99 (Collateral Value
$11,506,963) 11,170 11,170
-------------- ---------------
TOTAL REPURCHASE AGREEMENTS
(COST $111,170) 111,170 111,170
-------------- ---------------
SHORT-TERM INVESTMENTS (6.2%)
$50,000,000 American Express Credit Corp.,
5.23%, due 9/2/99 49,993 49,993
50,000,000 General Electric Capital Corp.,
5.10%, due 9/3/99 49,986 49,986
50,000,000 Merck & Co., Inc., 5.30%,
due 9/3/99 49,985 49,985
50,000,000 Ford Motor Credit Co., 5.28%,
due 9/8/99 49,949 49,949
50,000,000 Novartis Finance Corp., 5.25%,
due 9/13/99 49,912 49,912
19,057,000 Abbott Laboratories, 5.23%,
due 9/23/99 18,996 18,996
<PAGE>
24,436,603 N&B Securities Lending Quality
Fund, LLC 24,437 24,437
-------------- ---------------
TOTAL SHORT-TERM INVESTMENTS
(COST $293,258) 293,258 293,258
-------------- ---------------
TOTAL INVESTMENTS (98.3%)
(COST $4,053,868)
$ 4,643,705 $ 4,643,705
============== ===============
</TABLE>
(a) The proposed reorganization contemplates the merger of the funds and the
redemption in kind of the surviving fund's interest in the Guardian Portfolio.
<PAGE>
INTERNATIONAL PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
AUGUST 31, 1999 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET
VALUE (000'S
OMITTED)
AS REPORTED PRO FORMA
------------------------------------
EQUITY FUNDS- EQUITY TRUST-
NUMBER OF INTERNATIONAL INTERNATIONAL INTERNATIONAL
SHARES/PRINCIPAL AMOUNT FUND TRUST ADJUSTMENT (a) FUND
-------------------------
<S> <C> <C> <C> <C> <C>
Investment in Portfolio $ 112,213 $ 2,303 $ (114,516) $ 0
Investment in unaffiliated issuers
and non-controlled affiliated issuers
COMMON STOCKS (95.9%)
AUSTRALIA (1.5%)
58,000 Commonwealth Bank
of Australia $ 913 $ 913
53,000 National Australia
Bank 802 802
---------------- --------------
1,715 1,715
---------------- --------------
BELGIUM (1.4%)
15,151 Mobistar SA 721 721
8,060 Telinfo SA 919 919
---------------- --------------
1,640 1,640
---------------- --------------
BERMUDA (0.6%)
27,837 Global Crossing 720 720
--------------- --------------
CANADA (1.7%)
43,000 BioChem Pharma 1,115 1,115
<PAGE>
41,400 CGI Group 773 773
---------------- --------------
1,888 1,888
---------------- --------------
DENMARK (2.3%)
65,900 Navision Software 1,639 1,639
8,100 Vestas Wind Systems 1,025 1,025
---------------- --------------
2,664 2,664
---------------- --------------
FINLAND (5.5%)
27,900 Nokia Corp. ADR 2,326 2,326
89,500 Perlos Oyj 1,278 1,278
19,800 Pohjola Group
Insurance, B
Shares 966 966
50,000 Tietoenator Oyj 1,693 1,693
---------------- --------------
6,263 6,263
---------------- --------------
FRANCE (6.0%)
14,490 BNP 1,110 1,110
7,500 Cap Gemini 1,289 1,289
30,000 Dassault Systemes
ADR 1,132 1,132
37,500 Sanofi-Synthelabo 1,563 1,563
22,909 Vivendi 1,772 1,772
---------------- --------------
6,866 6,866
--------------- --------------
GERMANY (2.0%)
15,000 Mannesmann AG 2,304 2,304
---------------- --------------
HONG KONG (0.9%)
365,000 VTech Holdings 1,015 1,015
---------------- --------------
IRELAND (2.3%)
42,920 Allied Irish Banks
ADR 1,110 1,110
125,745 Bord Telecom
Eireann 573 573
44,200 CRH PLC 1,003 1,003
---------------- --------------
2,686 2,686
---------------- --------------
<PAGE>
ITALY (1.5%)
50,000 ENI SpA 301 301
93,023 Telecom Italia 533 533
149,600 TIM SpA 872 872
---------------- --------------
1,706 1,706
---------------- --------------
JAPAN (29.4%)
10,800 Acom Co. 1,097 1,097
8,200 Advantest Corp. 1,114 1,114
120,000 Bank of Tokyo-
Mitsubishi 1,794 1,794
8,500 Benesse Corp. 1,477 1,477
101,000 Chugai
Pharmaceutical 1,118 1,118
19,700 FamilyMart Co. 1,013 1,013
6,000 Fancl Corp. 1,783 1,783
2,300 Internet Initiative
Japan ADR 119 119
77,000 Minebea Co. 930 930
89,000 Mitsubishi Trust &
Banking 936 936
125,000 NSK Ltd. 805 805
165 NTT Corp. 1,856 1,856
130 NTT Mobile
Communication
Network 2,154 2,154
18,000 Seven-Eleven Japan 1,319 1,319
9,700 Softbank Corp. 3,336 3,336
12,800 Sony Corp. 1,660 1,660
108,000 Sumitomo Bakelite 1,130 1,130
75,000 Takeda Chemical
Industries 3,773 3,773
60,000 Terumo Corp. 1,921 1,921
31,900 THK Co. 1,047 1,047
3 Yahoo Japan 1,707 1,707
36,000 Yamanouchi
Pharmaceutical 1,607 1,607
---------------- --------------
33,696 33,696
---------------- --------------
<PAGE>
MALAYSIA (1.1%)
215,820 Malaysia WEBS Index
Series 1,214 1,214
---------------- --------------
MEXICO (0.9%)
122,500 Cemex SA, B Shares 542 542
15,750 Fomento Economico
Mexicano ADR 521 521
---------------- --------------
1,063 1,063
---------------- --------------
NETHERLANDS (4.5%)
16,000 Aegon NV-New York 1,389 1,389
28,748 Getronics NV 1,409 1,409
50,000 Laurus NV 1,124 1,124
50,000 Versatel Telecom
International 688 688
14,000 VNU NV 538 538
---------------- --------------
5,148 5,148
---------------- --------------
RUSSIA (0.6%)
19,200 Global TeleSystems
Group 620 620
---------------- --------------
SINGAPORE (7.4%)
924,000 Datacraft Asia 3,567 3,567
171,000 Natsteel
Electronics 853 853
220,000 Overseas Union Bank 1,150 1,150
150,000 United Overseas
Bank 1,114 1,114
78,000 Venture
Manufacturing 746 746
964,000 Wing Tai Holdings 1,036 1,036
---------------- --------------
8,466 8,466
---------------- --------------
SOUTH KOREA (2.7%)
30,150 Hyundai Securities 712 712
85,550 Korea Data System 1,178 1,178
66,000 Samsung Corp. 1,163 1,163
---------------- --------------
3,053 3,053
---------------- --------------
SPAIN (2.5%)
15,400 Banco Popular
<PAGE>
Espanol 1,130 1,130
35,748 Telefonica SA ADR 1,722 1,722
---------------- --------------
2,852 2,852
---------------- --------------
SWEDEN (2.1%)
106,900 Assa Ab loy 1,129 1,129
63,600 Skandia Forsakrings 1,298 1,298
---------------- --------------
2,427 2,427
---------------- --------------
SWITZERLAND (2.1%)
387 Disetronic Holding 1,279 1,279
300 Kudelski SA 1,124 1,124
---------------- --------------
2,403 2,403
---------------- --------------
UNITED KINGDOM (16.9%)
159,400 Airtours PLC 1,109 1,109
88,815 Alliance &
Leicester 1,215 1,215
71,400 Barclays PLC 2,122 2,122
63,028 BP Amoco 1,169 1,169
130,200 British Telecom 1,994 1,994
42,000 COLT Telecom Group 913 913
33,600 Energis PLC 861 861
30,500 Glaxo Wellcome 801 801
120,000 Hays PLC 1,276 1,276
40,000 Sage Group 1,744 1,744
120,000 SEMA Group 1,303 1,303
50,000 Serco Group 1,207 1,207
57,770 Vodafone AirTouch 1,164 1,164
266,000 WPP Group 2,486 2,486
---------------- --------------
19,364 19,364
---------------- --------------
TOTAL COMMON STOCKS
(COST $74,914) 109,773 109,773
---------------- --------------
PREFERRED STOCKS (0.6%)
270 Porsche AG, Germany
(COST $653) 681 681
---------------- --------------
<PAGE>
Principal Amount
-------------------------
REPURCHASE AGREEMENTS (3.4%)
$3,920,000 State Street Bank
and Trust Co.
Repurchase
Agreement, 5.25%,
due 9/1/99, dated
8/31/99, Maturity
Value $3,920,572,
Collateralized by
$3,210,000 U.S.
Treasury Bonds,
8.875%,
due 8/15/17
(Collateral Value
$4,040,937)
(COST $3,920) 3,920 3,920
---------------- --------------
SHORT-TERM INVESTMENTS (4.2%)
$4,873,994 N&B Securities
Lending Quality
Fund, LLC
(COST $4,874) 4,874 4,874
---------------- --------------
TOTAL INVESTMENTS
(104.1%) (COST
$84,361) $119,248 $119,248
================ ==============
(a) The proposed reorganization contemplates the merger of the funds and the
redemption in kind of the surviving fund's interest in the International
Portfolio. Because liabilities exceeded assets other than Investments at the
Portfolio level, certain of the investments being transferred would have been
liquidated.
</TABLE>
<PAGE>
MANHATTAN PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
AUGUST 31, 1999 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET VALUE
(000'S OMITTED)
AS REPORTED PRO FORMA
-------------------------
EQUITY EQUITY EQUITY
NUMBER OF FUNDS- TRUST- ASSETS-
SHARES/PRINCIPAL AMOUNT MANHATTAN MANHATTAN MANHATTAN
----------------------- FUND TRUST ASSETS ADJUSTMENTS(A) MANHATTAN FUND
<S> <C> <C> <C> <C> <C>
Investment in Portfolio $ 565,838 $ 45,305 $ 1,717 $ (612,860) $ 0
Investment in unaffiliated issuers and
non-controlled affiliated issuers
COMMON STOCKS (93.3%)
BUSINESS SERVICES (4.1%)
257,400 Avis Rent A Car $ 5,663 $ 5,663
148,800 Navigant Consulting 6,528 6,528
206,500 USWeb Corp. 4,027 4,027
202,150 Valassis Communications 8,844 8,844
-------------- --------
25,062 25,062
-------------- --------
CAPITAL GOODS (1.4%)
128,900 Waters Corp. 8,499 8,499
-------------- --------
COMMUNICATIONS (9.2%)
126,400 Comverse Technology 9,859 9,859
95,700 E-Tek Dynamics 5,425 5,425
315,100 Intermedia Communications 8,193 8,193
111,900 JDS Uniphase 11,868 11,868
245,400 Metromedia Fiber Network 7,224 7,224
58,500 RSL Communications 1,196 1,196
76,100 VoiceStream Wireless 3,139 3,139
184,600 WinStar Communications 9,380 9,380
------------ --------
56,284 56,284
------------ -------
1
<PAGE>
CONSUMER CYCLICALS (11.1%)
80,000 Adelphia Communications 4,960 4,960
212,495 AMFM Inc. 10,465 10,465
390,000 Cendant Corp. 6,996 6,996
178,700 Fortune Brands 6,701 6,701
132,400 Harley-Davidson 7,216 7,216
106,000 Jones Intercable Class A 4,651 4,651
138,900 NTL Inc. 13,638 13,638
237,450 SFX Entertainment 9,780 9,780
156,700 Starwood Hotels & Resorts
Worldwide 3,731 3,731
------------- --------
68,138 68,138
------------- --------
CONSUMER STAPLES (0.9%)
116,500 Estee Lauder 5,352 5,352
------------ --------
ELECTRICAL EQUIPMENT (9.7%)
230,000 Altera Corp. 9,689 9,689
27,700 Broadcom Corp. 3,566 3,566
93,000 Conexant Systems 6,684 6,684
102,600 Maxim Integrated Products 6,906 6,906
98,300 Micron Technology 7,330 7,330
126,600 PMC-Sierra 11,774 11,774
81,000 Vitesse Semiconductor 5,508 5,508
119,100 Xilinx Inc. 8,330 8,330
------------ --------
59,787 59,787
------------ --------
ENERGY (3.9%)
211,000 Coastal Corp. 9,139 9,139
250,700 Enron Oil & Gas 5,985 5,985
477,600 Union Pacific Resources Group 8,567 8,567
------------ --------
23,691 23,691
------------ --------
FINANCIAL SERVICES (4.9%)
179,300 Capital One Financial 6,769 6,769
118,600 Donaldson, Lufkin & Jenrette 5,671 5,671
171,900 E*TRADE Group 4,297 4,297
95,600 Lehman Brothers Holdings 5,139 5,139
105,500 Providian Financial 8,189 8,189
------------ --------
30,065 30,065
------------ --------
2
<PAGE>
HARDWARE (5.5%)
298,700 Adaptec, Inc. 11,649 11,649
106,500 Network Appliance 6,996 6,996
202,300 Sanmina Corp. 15,173 15,173
------------ --------
33,818 33,818
------------ --------
HEALTH CARE (11.7%)
185,400 Biogen, Inc. 14,229 14,229
33,700 C. R. Bard 1,571 1,571
301,100 Elan Corp. ADR 9,654 9,654
151,400 Immunex Corp. 10,191 10,191
41,750 MedImmune, Inc. 4,308 4,308
75,600 MiniMed Inc. 6,875 6,875
80,700 PE Corp.-PE Biosystems Group 5,553 5,553
98,600 Sepracor Inc. 7,383 7,383
201,900 The Laser Center 6,032 6,032
78,500 Wellpoint Health Networks 5,721 5,721
------------ --------
71,517 71,517
------------ --------
INTERNET (8.4%)
47,200 BroadVision, Inc. 4,699 4,699
284,000 CheckFree Holdings 8,307 8,307
75,900 Digex, Inc. 2,524 2,524
33,600 DoubleClick Inc. 3,356 3,356
41,200 Exodus Communications 3,311 3,311
22,800 Inktomi Corp. 2,585 2,585
124,200 Intuit Inc. 11,124 11,124
105,000 Lycos, Inc. 4,266 4,266
130,200 PSINet Inc. 6,233 6,233
79,300 Safeguard Scientifics 5,333 5,333
------------ --------
51,738 51,738
------------ --------
RETAIL (11.9%)
202,900 Abercrombie & Fitch 7,076 7,076
176,100 Ann Taylor Stores 5,833 5,833
180,700 Best Buy 12,694 12,694
75,100 Brinker International 1,803 1,803
107,200 Circuit City Stores 4,610 4,610
197,400 Furniture Brands 3,960 3,960
International
68,800 Limited, Inc. 2,606 2,606
197,500 Linens 'n Things 6,764 6,764
324,600 Staples, Inc. 7,060 7,060
136,000 Tandy Corp. 6,426 6,426
486,200 TJX Cos. 14,039 14,039
------------ --------
72,871 72,871
------------ --------
3
<PAGE>
SOFTWARE (9.2%)
317,400 Citrix Systems 18,092 18,092
129,800 Gemstar International Group 8,956 8,956
330,000 Novell, Inc. 7,817 7,817
145,300 Siebel Systems 9,980 9,980
194,400 VERITAS Software 11,518 11,518
------------ --------
56,363 56,363
------------ --------
UTILITIES (1.4%)
280,400 Montana Power 8,675 8,675
------------ --------
TOTAL COMMON STOCKS (COST
$449,526) 571,860 571,860
------------ --------
Principal Amount
---------------------
U.S. GOVERNMENT AGENCY SECURITIES (0.4%)
$2,750,000 Federal Home Loan Bank,
Discount Notes, 5.15%,
due 9/2/99 (COST $2,750) 2,750 2,750
------------- --------
REPURCHASE AGREEMENTS (2.0%)
12,240,000 State Street Bank and Trust Co.
Repurchase Agreement, 5.25%,
due 9/1/99, dated 8/31/99,
Maturity Value $12,241,785,
Collateralized by $12,445,000
U.S. Treasury Notes, 5.875%,
due 6/30/00 (Collateral Value
$12,609,013) (COST $12,240) 12,240 12,240
------------- ---------
SHORT-TERM INVESTMENTS (22.2%)
11,000,000 Ford Motor Credit Co., 5.14% &
5.20%, due 9/2/99 & 9/7/99 10,996 10,996
3,000,000 AT&T Corp., 5.18%, due 9/7/99 2,998 2,998
3,000,000 Emerson Electric Co., 5.30%,
due 9/10/99 2,996 2,996
118,910,279 N&B Securities Lending
Quality Fund, LLC
118,910 118,910
------------- --------
4
<PAGE>
TOTAL SHORT-TERM INVESTMENTS
(COST $135,900) 135,900 135,900
------------- --------
TOTAL INVESTMENTS (117.9%)
(COST $600,416) $ 722,750 $722,750
------------- -----------
</TABLE>
(a) The proposed reorganization contemplates the merger of the funds and the
redemption in kind of the surviving fund's interest in the Manhattan Portfolio.
Because liabilities exceeded assets other than Investments at the Portfolio
level, certain of the investments being transferred would have been liquidated.
5
<PAGE>
MILLENNIUM PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
FEBRUARY 29, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET VALUE
(000'S OMITTED)
AS REPORTED PRO FORMA
-----------------------------------
NUMBER OF EQUITY EQUITY
SHARES/PRINCIPAL EQIOTU FUNDS- TRUST- ASSETS-
AMOUNT MILLENNIUM MILLENNIUM MILLENNIUM
---------------------- FUND TRUST ASSETS ADJUSTMENTS(A) MILLENNIUM FUND
<S> <C> <C> <C> <C> <C>
Investment in Portfolio $ 326,493 $ 16,116 $ 66 $ (342,675) $ 0
Investment in unaffiliated issuers and non-
controlled affiliated issuers
COMMON STOCKS (98.7%)
BUSINESS SERVICES (4.2%)
154,700 Circle.com $ 1,460 $ 1,460
217,500 Corinthian Colleges 3,888 3,888
109,350 Iron Mountain 3,335 3,335
104,700 Luminant Worldwide 2,565 2,565
91,300 Official Payments 3,276 3,276
300 Onvia.com 6 6
----------- --------------
14,530 14,530
----------- --------------
BUSINESS SERVICES - GENERAL BUSINESS SERVICES (1.4%)
608,500 Strategic Diagnostics 4,830 4,830
----------- --------------
BUSINESS SERVICES - IT BUSINESS SERVICES (0.7%)
140,500 Hall, Kinion & Associates 2,529 2,529
----------- --------------
CONSUMER CYCLICAL - LEISURE & CONSUMER SERVICE (0.9%)
147,100 Premier Parks 2,979 2,979
----------- --------------
CONSUMER CYCLICAL - CONSUMER MEDIA (2.5%)
92,300 Citadel Communications 3,127 3,127
51,400 Emmis Communications 1,876 1,876
29,800 Pegasus Communications 3,695 3,695
----------- --------------
8,698 8,698
----------- --------------
1
<PAGE>
ENERGY (3.5%)
71,500 Hanover Compressor 3,356 3,356
66,900 Independent Energy Holdings ADR 3,349 3,349
102,200 Maverick Tube 2,300 2,300
127,800 Patterson Energy 2,915 2,915
----------- --------------
11,920 11,920
----------- --------------
FINANCIAL SERVICES (5.8%)
82,800 Affiliated Managers Group 3,255 3,255
50,952 Digital Insight 3,210 3,210
79,650 eSPEED, Inc. 4,933 4,933
165,400 Netzee, Inc. 4,238 4,238
197,200 SierraCities.com 4,166 4,166
----------- -------------
19,802 19,802
----------- -------------
HARDWARE (0.9%)
32,600 DII Group 3,152 3,152
----------- -------------
HEALTH CARE (9.0%)
14,000 Abgenix, Inc. 4,510 4,510
61,200 Allscripts, Inc. 4,223 4,223
70,500 Anesta Corp. 1,569 1,569
37,100 ArthroCare Corp. 4,582 4,582
120,700 ChromaVision Medical Systems 2,482 2,482
49,500 Enzon, Inc. 2,871 2,871
12,800 Human Genome Sciences 2,793 2,793
95,100 INAMED Corp. 3,602 3,602
51,900 Pharmacyclics, Inc. 4,142 4,142
----------- -------------
30,774 30,774
----------- -------------
INTERNET (9.5%)
94,800 About.com 6,660 6,660
301,800 Cybergold, Inc. 6,036 6,036
25,000 InterVU Inc. 3,698 3,698
138,200 Lifeminders.com 7,342 7,342
120,200 Marketing Services Group 3,185 3,185
117,100 MyPoints.com 5,489 5,489
----------- -------------
32,410 32,410
----------- -------------
RETAIL (3.6%)
96,400 American Eagle Outfitters 2,458 2,458
152,300 Factory 2-U Stores 3,693 3,693
100,100 Insight Enterprises 3,141 3,141
210,400 Steven Madden 2,840 2,840
----------- -------------
12,132 12,132
----------- -------------
SEMICONDUCTORS (6.5%)
97,600 Asyst Technologies 4,477 4,477
20,400 Cree, Inc. 3,833 3,833
95,200 Cypress Semiconductor 4,343 4,343
46,000 Elantec Semiconductor 2,895 2,895
60,900 Helix Technology 4,332 4,332
48,600 Zoran Corp. 2,479 2,479
----------- -------------
22,359 22,359
----------- -------------
2
<PAGE>
SOFTWARE (9.0%)
75,100 Active Software 7,885 7,885
74,100 Actuate Software 4,622 4,622
114,400 BindView Development 3,861 3,861
42,600 PC-Tel 2,897 2,897
47,000 Project Software & Development 3,639 3,639
56,500 Radiant Systems 2,889 2,889
77,200 Visual Networks 5,076 5,076
----------- -------------
30,869 30,869
----------- -------------
TECHNOLOGY - HARDWARE (16.1%)
71,800 AudioCodes Ltd. 5,547 5,547
65,500 Efficient Networks 10,562 10,562
20,000 Extended Systems 2,035 2,035
53,800 Mercury Computer Systems 2,592 2,592
42,000 Natural MicroSystems 2,678 2,678
84,300 Netopia, Inc. 7,271 7,271
81,100 Osicom Technologies 11,754 11,754
61,200 SonicWALL, Inc. 5,539 5,539
34,000 Virata Corp. 5,015 5,015
65,500 Westell Technologies 2,243 2,243
----------- -------------
55,236 55,236
----------- -------------
TECHNOLOGY - SEMICONDUCTOR (4.4%)
270,800 Artisan Components 6,872 6,872
171,100 Integrated Device Technology 6,309 6,309
25,000 Kopin Corp. 1,853 1,853
----------- -------------
15,034 15,034
----------- -------------
TECHNOLOGY - SOFTWARE (6.1%)
27,100 Allaire Corp. 3,506 3,506
83,300 IONA Technologies ADR 7,060 7,060
52,500 Netegrity, Inc. 4,489 4,489
137,800 SERENA Software 5,813 5,813
----------- -------------
20,868 20,868
----------- -------------
TELECOMMUNICATIONS (14.6%)
47,200 AirGate PCS 4,626 4,626
83,100 C-COR.net 3,716 3,716
225,500 CAIS Internet 8,625 8,625
45,300 Digex, Inc. 7,339 7,339
41,500 Digital Island 4,819 4,819
78,300 Eloquent, Inc. 2,633 2,633
109,500 Network Plus 4,223 4,223
30,100 Nextel Partners 963 963
137,700 Pinnacle Holdings 8,055 8,055
7,900 Teltrend Inc. 837 837
53,000 Time Warner Telecom 4,081 4,081
----------- -------------
49,917 49,917
----------- -------------
TOTAL COMMON STOCKS (COST 338,039 338,039
$211,549) ----------- -------------
Principal Amount
------------------
REPURCHASE AGREEMENTS (2.9%)
$ 9,906,000 State Street Bank and Trust Co. Repurchase
Agreement, 5.71%, due 3/1/00, dated 2/29/00,
Maturity Value $9,907,571, Collateralized by
$10,155,000 Fannie Mae, Notes, 6.40%, due
9/27/01 (Collateral Value $10,206,384)
(COST $9,906) 9,906 9,906
----------- -------------
SHORT-TERM INVESTMENTS (12.6%)
43,222,736 N&B Securities Lending Quality
Fund, LLC
(COST $43,223) 43,223 43,223
----------- -------------
TOTAL INVESTMENTS (114.2%) (COST $264,678) $ 391,168 $ 391,168
----------- -------------
</TABLE>
(a) The proposed reorganization contemplates the merger of the funds and the
redemption in kind of the surviving fund's interest in the Millennium Portfolio.
Because liabilities exceeded assets other than Investments at the Portfolio
level, certain of the investments being transferred would have been liquidated.
<PAGE>
PARTNERS PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
AUGUST 31, 1999 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET
VALUE
(000'S
OMITTED)
AS
REPORTED PRO FORMA
-------------------
EQUITY EQUITY EQUITY
FUNDS- TRUST- ASSETS-
PARTNERS PARTNERS PARTNERS
NUMBER OF SHARES/PRINCIPAL AMOUNT FUND TRUST ASSETS ADJUSTMENTS(A) PARTNERS FUND
-----------------------------------
<S> <C> <C> <C> <C> <C>
Investment in Portfolio $2,857,082 $849,259 $62,399 $ (3,768,740) $ 0
Investment in unaffiliated issuers and
non-controlled affiliated issuers
COMMON STOCKS (92.1%)
AEROSPACE (1.1%)
600,000 Raytheon Co. Class A $ 40,275 $ 40,275
------------- -----------
AIRLINES (1.9%)
330,900 AMR Corp. 19,399 19,399
1,280,000 Continental Airlines Class B 52,240 52,240
------------- -----------
71,639 71,639
------------- -----------
AUTOMOBILE MANUFACTURING (2.3%)
1,315,800 General Motors 87,007 87,007
------------- -----------
AUTO/TRUCK REPLACEMENT PARTS (1.3%)
1,180,000 Lear Corp. 47,421 47,421
------------- -----------
BANKING & FINANCIAL (11.3%)
1,305,000 Bank of America 78,953 78,953
1,945,000 Bank One 78,043 78,043
1,143,800 BankBoston Corp. 53,115 53,115
1,560,000 Chase Manhattan 130,553 130,553
1,337,000 Countrywide Credit 42,951 42,951
Industries
1,140,000 Household International 43,035 43,035
------------- -----------
426,650 426,650
------------- -----------
1
<PAGE>
CHEMICALS (1.5%)
765,000 duPont 48,482 48,482
620,000 Lyondell Chemical 9,029 9,029
------------- -----------
57,511 57,511
------------- -----------
COMMUNICATIONS (4.0%)
600,000 Bell Atlantic 36,750 36,750
1,520,000 MCI WorldCom 115,140 115,140
------------- -----------
151,890 151,890
------------- -----------
DIVERSIFIED (1.8%)
1,658,500 Monsanto Co. 68,102 68,102
------------- -----------
ELECTRONICS (1.1%)
353,900 Emerson Electric 22,163 22,163
275,000 Teradyne, Inc. 18,717 18,717
------------- -----------
40,880 40,880
------------- -----------
ENERGY (0.8%)
1,314,600 McDermott International 29,661 29,661
------------- -----------
FINANCIAL SERVICES (3.0%)
1,070,000 Ceridian Corp. 29,960 29,960
330,000 Morgan Stanley Dean Witter 28,318 28,318
1,240,000 SLM Holding 54,793 54,793
------------- -----------
113,071 113,071
------------- -----------
FOOD & TOBACCO (3.4%)
1,040,000 Anheuser-Busch 80,080 80,080
1,209,500 Nabisco Holdings 47,549 47,549
------------- -----------
127,629 127,629
------------- -----------
2
<PAGE>
FOOD PRODUCTS (1.7%)
526,100 ConAgra, Inc. 12,889 12,889
1,195,800 Diageo PLC ADR 49,551 49,551
------------- -----------
62,440 62,440
------------- -----------
GAS (1.7%)
1,347,400 Praxair, Inc. 63,328 63,328
------------- -----------
HEALTH CARE (12.9%)
475,000 ALZA Corp. 23,928 23,928
1,579,500 American Home Products 65,549 65,549
870,000 Baxter International 58,345 58,345
1,602,100 Becton, Dickinson & Co. 45,059 45,059
1,230,000 Centocor, Inc. 73,646 73,646
1,498,800 CIGNA Corp. 134,611 134,611
669,800 Merck & Co. 45,002 45,002
540,000 Wellpoint Health Networks 39,353 39,353
------------- -----------
485,493 485,493
------------- -----------
INDUSTRIAL GOODS & SERVICES (2.9%)
845,800 Fort James 27,277 27,277
1,055,700 General Dynamics 66,509 66,509
637,300 Owens-Illinois 15,773 15,773
------------- -----------
109,559 109,559
------------- -----------
INSURANCE (2.8%)
1,599,200 Ace, Ltd. 34,283 34,283
370,000 American International Group 34,294 34,294
743,494 XL Capital 37,407 37,407
------------- -----------
105,984 105,984
------------- -----------
OIL & GAS (6.5%)
304,000 Chevron Corp. 28,044 28,044
840,000 Texaco Inc. 53,340 53,340
2,042,200 Tosco Corp. 52,076 52,076
1,400,200 Transocean Offshore 47,607 47,607
2,077,500 USX-Marathon Group 64,662 64,662
------------- -----------
245,729 245,729
------------- -----------
3
<PAGE>
RAILROADS (1.1%)
1,461,800 Burlington Northern Santa Fe 42,392 42,392
------------- -----------
RETAILING (3.4%)
1,620,000 Consolidated Stores 26,123 26,123
990,300 Harcourt General 43,388 43,388
243,100 Office Depot 2,537 2,537
3,052,600 Rite Aid 56,473 56,473
------------- -----------
128,521 128,521
------------- -----------
STEEL (0.9%)
1,639,400 AK Steel Holding 34,427 34,427
------------- -----------
TECHNOLOGY (18.1%)
2,427,500 Cadence Design Systems 33,075 33,075
861,300 Compaq Computer 19,971 19,971
1,940,000 Computer Associates 109,610 109,610
1,592,400 General Motors Class H 82,009 82,009
440,000 Hewlett-Packard 46,365 46,365
680,000 IBM 84,702 84,702
1,840,000 L.M. Ericsson Telephone, B
Shares ADR 59,915 59,915
1,592,600 Nortel Networks 65,396 65,396
2,865,000 Parametric Technology 40,110 40,110
537,000 Texas Instruments 44,068 44,068
2,038,900 Xerox Corp. 97,357 97,357
------------- -----------
682,578 682,578
------------- -----------
TELECOMMUNICATIONS (2.4%)
1,540,000 AT&T Corp.- Liberty Media Group
Class A 49,280 49,280
600,000 GTE Corp. 41,175 41,175
------------- -----------
90,455 90,455
------------- -----------
UTILITIES (3.3%)
2,130,000 The Williams Cos. 87,863 87,863
952,400 Unicom Corp. 36,786 36,786
------------- -----------
124,649 124,649
------------- ------------
WASTE MANAGEMENT (0.9%)
2,598,200 Allied Waste Industries 33,127 33,127
------------- -----------
4
<PAGE>
TOTAL COMMON STOCKS
(COST $3,107,009) 3,470,418 3,470,418
------------- -----------
PREFERRED STOCKS (2.2%)
3,123,800 News Corp. ADR (COST $86,104) 82,586 82,586
------------- ------------
Principal
Amount
------------------------------
REPURCHASE AGREEMENTS (1.7%)
$ 50,000,000 State Street Bank and Trust
Co.
Repurchase Agreement, 5.25%,
due 9/1/99, dated 8/31/99,
Maturity Value $50,007,292,
Collateralized by
$40,915,000
U.S. Treasury Bonds, 8.875%,
due 8/15/17 (Collateral
Value
$51,506,216) 50,000 50,000
13,300,000 State Street Bank and Trust
Co.
Repurchase Agreement, 5.25%,
due 9/1/99, dated 8/31/99,
Maturity Value $13,301,940,
Collateralized by
$13,635,000
U.S. Treasury Notes, 5.875%,
due 2/15/00 (Collateral
Value
$13,703,911) 13,300 13,300
------------- -----------
TOTAL REPURCHASE AGREEMENTS
(COST $63,300) 63,300 63,300
------------- -----------
SHORT-TERM INVESTMENTS (6.9%)
50,000,000 Ford Motor Credit Co.,
5.21%, due 9/2/99 49,993 49,993
20,200,000 Novartis Finance Corp.,
5.27%, due 9/7/99 20,182 20,182
50,000,000 American Express Credit
Corp., 5.31%, due 9/8/99 49,948 49,948
139,642,039 N&B Securities Lending
Quality Fund, LLC 139,642 139,642
------------- -----------
TOTAL SHORT-TERM INVESTMENTS
(COST $259,765) 259,765 259,765
------------- -----------
5
<PAGE>
TOTAL INVESTMENTS (102.9%)
(COST $3,516,178) $ 3,876,069 $ 3,876,069
============ ===========
</TABLE>
(a) The proposed reorganization contemplates the merger of the funds and the
redemption in kind of the surviving fund's interest in the Partners Portfolio.
6
<PAGE>
REGENCY PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
AUGUST 31, 1999 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET
VALUE
(000'S
OMITTED)
REPORTED PRO FORMA
-------------------
NUMBER OF EQUITY EQUITY
SHARES/PRINCIPAL FUNDS- TRUST-
AMOUNT REGENCY REGENCY
------------------ FUND TRUST ADJUSTMENTS(A) REGENCY FUND
<S> <C> <C> <C> <C>
Investment in Portfolio $ 7,923 $ 353 $ (8,276) $ 0
Investment in unaffiliated issuers and
non-controlled affiliated issuers
COMMON STOCKS (87.0%)
AIRLINES (1.3%)
2,700 Continental Airlines Class B $ 110 $ 110
-------------- -------------
AUTOMOTIVE (2.6%)
3,700 Lear Corp. 149 149
1,400 Navistar International 68 68
-------------- -------------
217 217
-------------- -------------
BANKING & FINANCIAL (5.6%)
4,800 BankBoston Corp. 223 223
1,900 Countrywide Credit Industries 61 61
8,600 IndyMac Mortgage Holdings 115 115
2,600 Valley National Bancorp 68 68
-------------- ------------
467 467
-------------- ------------
CHEMICALS (1.1%)
6,400 Lyondell Chemical 93 93
-------------- ------------
1
<PAGE>
CONSUMER CYCLICALS (1.7%)
1,800 Lexmark International Group 142 142
-------------- ------------
CONSUMER PRODUCTS & SERVICES (1.5%)
7,400 American National Can Group 121 121
-------------- ------------
ELECTRICAL & ELECTRONICS (1.1%)
6,200 Niagara Mohawk Holdings 94 94
-------------- ------------
ENERGY (2.7%)
3,500 Coastal Corp. 152 152
3,300 McDermott International 74 74
-------------- ------------
226 226
-------------- ------------
ENTERTAINMENT (1.0%)
6,500 Mirage Resorts 85 85
-------------- ------------
FINANCIAL SERVICES (10.7%)
1,600 Ambac Financial Group 85 85
4,700 Bear Stearns 196 196
5,500 Ceridian Corp. 154 154
4,200 Dun & Bradstreet 110 110
2,900 FINOVA Group 110 110
1,600 Kansas City Southern Industries 74 74
3,600 SLM Holding 159 159
-------------- ------------
888 888
-------------- ------------
GAS (1.8%)
3,200 Praxair, Inc. 150 150
-------------- ------------
HEALTH CARE (3.4%)
4,900 Becton, Dickinson & Co. 138 138
2,000 Wellpoint Health Networks 146 146
-------------- ------------
284 284
-------------- ------------
INDUSTRIAL GOODS & SERVICES (8.1%)
4,200 Fort James 135 135
3,300 General Dynamics 208 208
1,000 Reynolds Metals 63 63
4,500 Sherwin-Williams 110 110
6,200 UCAR International 151 151
-------------- -----------
667 667
-------------- -----------
INSURANCE (3.2%)
6,300 Ace, Ltd. 135 135
700 CIGNA Corp. 63 63
1,700 Cincinnati Financial 67 67
-------------- ------------
265 265
-------------- ------------
2
<PAGE>
MACHINERY & EQUIPMENT (2.7%)
1,300 Grainger, Inc. 57 57
2,000 SPX Corp. 169 169
-------------- ------------
226 226
-------------- ------------
MEDIA (0.7%)
1,200 E.W. Scripps 58 58
-------------- ------------
OIL & GAS (7.3%)
3,000 Apache Corp. 136 136
3,600 Noble Drilling 89 89
4,400 Tosco Corp. 112 112
3,000 Transocean Offshore 102 102
5,200 USX-Marathon Group 162 162
-------------- ------------
601 601
-------------- ------------
RAILROADS (1.4%)
3,900 Burlington Northern Santa Fe 113 113
-------------- ------------
RETAILING (8.1%)
5,700 Consolidated Stores 92 92
22,800 Food Lion Class A 180 180
2,200 Harcourt General 96 96
6,100 Rite Aid 113 113
9,800 W.R. Grace 188 188
-------------- ------------
669 669
-------------- ------------
STEEL (0.9%)
3,600 AK Steel Holding 76 76
-------------- ------------
TECHNOLOGY (9.7%)
9,900 Cadence Design Systems 135 135
9,800 Comdisco, Inc. 206 206
1,000 Computer Associates 57 57
5,900 Engelhard Corp. 118 118
3,100 General Motors Class H 160 160
8,800 Parametric Technology 123 123
-------------- ------------
799 799
-------------- ------------
TELECOMMUNICATIONS (4.2%)
7,700 A.H. Belo 146 146
5,600 American Tower 127 127
2,300 AT&T Corp.- Liberty Media Group
Class A 74 74
-------------- ------------
347 347
-------------- ------------
3
<PAGE>
TRANSPORTATION (2.1%)
3,500 Galileo International 170 170
-------------- ------------
UTILITIES (2.2%)
4,300 The Williams Cos. 177 177
-------------- ------------
WASTE MANAGEMENT (1.9%)
12,000 Allied Waste Industries 153 153
-------------- ------------
TOTAL COMMON STOCKS (COST $7,700) 7,198 7,198
-------------- ------------
PREFERRED STOCKS (1.2%)
3,800 News Corp. ADR (COST $116) 100 100
-------------- ------------
Principal Amount
-------------------
U.S. GOVERNMENT AGENCY SECURITIES (4.5%)
$ 200,000 Federal Home Loan Bank, Discount
Notes, 5.40%, due 9/1/99 200 200
175,000 Federal Farm Credit Bank, Discount
Notes, 5.09%, due 9/2/99 175 175
-------------- ------------
TOTAL U.S. GOVERNMENT AGENCY
SECURITIES (COST $375) 375 375
-------------- ------------
REPURCHASE AGREEMENTS (4.5%) 370,000 State Street Bank and Trust Co.
Repurchase Agreement, 5.25%,
due 9/1/99, dated 8/31/99,
Maturity Value $370,054,
Collateralized by $350,000 U.S.
Treasury Bonds, 7.25%,
due 8/15/22 (Collateral Value
$382,375) (COST $370) 370 370
-------------- ------------
4
<PAGE>
SHORT-TERM INVESTMENTS (0.6%)
50,488 N&B Securities Lending Quality
Fund, LLC (COST $50) 50 50
-------------- ------------
TOTAL INVESTMENTS (97.8%) (COST $8,611) $ 8,093 $ 8,093
============ ============
</TABLE>
(a) The proposed reorganization contemplates the merger of the funds and the
redemption in kind of the surviving fund's interest in the Regency Portfolio.
5
<PAGE>
SOCIALLY RESPONSIVE PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
AUGUST 31, 1999 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET
VALUE (000'S
OMITTED)
AS REPORTED PRO FORMA
-----------------------------------------------------
EQUITY TRUST- EQUITY
NUMBER OF FUNDS- NYCDC ASSETS- EQUITY SERIES- SOCIALLY
SHARES/PRINCIPAL SOCIALLY SOCIALLY SOCIALLY SOCIALLY RESPONSIVE
AMOUNT RESPONSIVE RESPONSIVE RESPONSIVE RESPONSIVE FUND
-------------------- FUND TRUST TRUST ASSETS ADJUSTMENTS(A)
<S> <C> <C> <C> <C> <C> <C>
Investment in Portfolio $ 118,614 $ 253,115 $ 25,267 $ 117 $ (397,113) $ 0
Investment in unaffiliated
issuers and non-controlled
affiliated issuers
COMMON STOCKS (93.9%)
ADVERTISING (2.7%)
330,000 True North Communications $ 10,869 $ 10,869
-------------- ----------
AUTOMOTIVE (1.6%)
137,200 Borg-Warner Automotive 6,500 6,500
-------------- ----------
CHEMICALS (1.3%)
100,000 Minerals Technologies 4,950 4,950
-------------- ----------
CONSUMER GOODS & SERVICES (2.2%)
150,000 Kimberly-Clark 8,541 8,541
-------------- ----------
DIVERSIFIED (3.1%)
120,000 Tyco International 12,157 12,157
-------------- ----------
ENERGY (2.3%)
100,000 Chevron Corp. 9,225 9,225
-------------- ----------
ENTERTAINMENT (2.0%)
350,000 Fox Entertainment Group 8,072 8,072
-------------- ----------
1
<PAGE>
FINANCIAL SERVICES (9.8%)
150,000 Ambac Financial Group 7,922 7,922
276,750 Citigroup Inc. 12,298 12,298
275,000 Conseco, Inc. 6,600 6,600
200,000 Dun & Bradstreet 5,238 5,238
100,000 Fannie Mae 6,212 6,212
9,300 Goldman Sachs 556 556
-------------- ----------
38,826 38,826
-------------- ----------
FURNISHINGS (2.2%)
400,000 Leggett & Platt 8,850 8,850
-------------- ----------
HEALTH CARE (15.8%)
220,000 ALZA Corp. 11,082 11,082
170,000 Biogen, Inc. 13,047 13,047
260,000 Invacare Corp. 4,859 4,859
90,000 Johnson & Johnson 9,203 9,203
220,000 McKesson HBOC 6,848 6,848
135,000 Warner-Lambert 8,944 8,944
118,000 Wellpoint Health Networks 8,599 8,599
-------------- ----------
62,582 62,582
-------------- ----------
HOSPITAL SUPPLIES (2.4%)
200,000 C. R. Bard 9,325 9,325
------------ ----------
INSURANCE (3.7%)
380,000 ESG Re 5,130 5,130
210,000 ReliaStar Financial 9,463 9,463
-------------- ----------
14,593 14,593
-------------- ----------
OIL & GAS (4.3%)
220,000 Anadarko Petroleum 7,480 7,480
230,000 Cooper Cameron 9,574 9,574
-------------- ----------
17,054 17,054
-------------- ----------
PAPER & FOREST PRODUCTS (2.2%)
238,000 Mead Corp. 8,880 8,880
-------------- ----------
PUBLISHING & BROADCASTING (2.5%)
225,000 Valassis Communications 9,844 9,844
-------------- ----------
RECYCLING (0.7%)
187,500 IMCO Recycling 2,941 2,941
-------------- ----------
RETAIL GROCERY (1.7%)
140,000 Albertson's Inc. 6,711 6,711
-------------- ----------
2
<PAGE>
RETAIL STORES (6.1%)
250,000 Circuit City Stores 10,750 10,750
120,000 Dayton Hudson 6,960 6,960
145,000 Federated Department Stores 6,670 6,670
-------------- ----------
24,380 24,380
-------------- ----------
RETAILING (2.0%)
179,000 Wal-Mart Stores 7,932 7,932
-------------- ----------
TECHNOLOGY (17.9%)
374,000 Compaq Computer 8,672 8,672
150,000 Electronic Data Systems 8,419 8,419
120,000 Hewlett-Packard 12,645 12,645
160,000 Intel Corp. 13,150 13,150
400,000 Quantum Corp. - DLT & Storage
Systems 7,325 7,325
200,000 Quantum Corp. - Hard Disk Drive 1,425 1,425
300,000 Unisys Corp. 12,900 12,900
140,000 Xerox Corp. 6,685 6,685
-------------- ----------
71,221 71,221
-------------- ----------
TELECOMMUNICATIONS (3.7%)
150,000 MCI WorldCom 11,363 11,363
503,200 Metromedia International Group 3,176 3,176
-------------- ----------
14,539 14,539
-------------- ----------
TRANSPORTATION (2.1%)
140,000 AMR Corp. 8,208 8,208
-------------- ----------
WASTE MANAGEMENT (1.6%)
350,000 Azurix Corp. 6,497 6,497
-------------- ----------
TOTAL COMMON STOCKS (COST
$274,738) 372,697 372,697
-------------- ----------
Principal
Amount
--------------------
U.S. GOVERNMENT AGENCY SECURITIES (2.3%)
$4,000,000 Fannie Mae, Discount Notes,
5.15%, due 9/3/99 3,999 3,999
5,000,000 Freddie Mac, Discount Notes,
5.18% & 5.23%, due 9/9/99 &
9/10/1999 4,994 4,994
-------------- ----------
3
<PAGE>
TOTAL U.S. GOVERNMENT AGENCY
SECURITIES (COST $8,993) 8,993 8,993
-------------- ----------
REPURCHASE AGREEMENTS (2.1%)
8,370,000 State Street Bank and Trust Co.
Repurchase Agreement, 5.25%,
due 9/1/99, dated 8/31/99,
Maturity Value $8,371,221,
Collateralized by $8,495,000
U.S. Treasury Notes, 5.625%,
due 5/15/01 (Collateral Value
$8,621,966) (COST $8,370) 8,370 8,370
-------------- ----------
SHORT-TERM INVESTMENTS (0.6%)
100,000 Community Capital Bank, 4.05%,
due 9/29/99 100 100
100,000 Self Help Credit Union, 4.71%,
due 11/24/99 100 100
2,340,353 N&B Securities Lending Quality
Fund, LLC 2,340 2,340
-------------- ----------
TOTAL SHORT-TERM INVESTMENTS
(COST $2,540) 2,540 2,540
-------------- ----------
TOTAL INVESTMENTS (98.9%) (COST
$294,641) $ 392,600 $ 392,600
============== ==========
(a) The proposed reorganization contemplates the merger of the funds and the redemption in kind of the surviving fund's
interest in the Socially Responsive Portfolio.
</TABLE>
4
<PAGE>
TECHNOLOGY PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
JUNE 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET VALUE
(000'S OMITTED)
AS REPORTED PRO FORMA
---------------------------------
NUMBER OF EQUITY FUNDS- EQUITY TRUST-
SHARES/PRINCIPAL TECHNOLOGY TECHNOLOGY
AMOUNT FUND FUND ADJUSTMENTS (A) TECHNOLOGY TRUST
----------------------
<S> <C> <C> <C> <C>
Investment in Portfolio $ 16,040 $ 2,112 $ (18,152) $ 0
Investment in unaffiliated issuers
and non-controlled affiliated issuers
COMMON STOCKS (89.6%)
COMMUNICATIONS (16.3%)
1,200 Brocade Communications $ 220 $ 220
5,200 Cisco Systems 330 330
5,900 Comverse Technology 549 549
2,000 E-Tek Dynamics 528 528
3,700 Efficient Networks 272 272
4,100 Nextel Communications 251 251
8,200 Nokia Corp. 409 409
2,200 Redback Networks 392 392
--------------- ---------------
2,951 2,951
--------------- ---------------
CONSUMER STAPLES (2.3%)
6,500 TV Guide 223 223
2,600 Time Warner 197 197
--------------- ---------------
420 420
--------------- ---------------
ELECTRICAL EQUIPMENT (13.2%)
6,200 Analog Devices 471 471
1,500 Applied Materials 136 136
2,300 Broadcom Corp. 503 503
2,700 Conexant Systems 131 131
800 Cree, Inc. 107 107
1,300 Globespan 159 159
3,600 Intersil Holding Corp. Class A 195 195
4,400 KLA-Tencor 258 258
2,500 PMC-Sierra 444 444
--------------- ---------------
2,404 2,404
--------------- ---------------
1
<PAGE>
HARDWARE (8.1%)
5,300 Flextronics International 364 364
3,400 EMC Corp. 262 262
4,200 Network Appliance 338 338
2,600 QLogic Corp. 172 172
3,700 Sun Microsystems 336 336
--------------- ---------------
1,472 1,472
--------------- ---------------
HEALTH CARE (10.0%)
4,900 Amgen Inc. 344 344
500 Charles River Laboratories 11 11
1,900 Human Genome Sciences 253 253
6,800 Immunex Corp. 336 336
4,900 MedImmune, Inc. 363 363
1,600 MiniMed Inc. 189 189
4,900 PE Corp. 323 323
--------------- ---------------
1,819 1,819
--------------- ---------------
INTERNET (11.2%)
2,800 Digex, Inc. 190 190
3,200 Ebay Inc. 174 174
6,700 Intuit Inc. 277 277
3,100 Phone.com 202 202
4,000 Portal Software 255 255
3,400 VeriSign, Inc. 600 600
6,300 Vignette Corp. 328 328
--------------- ---------------
2,026 2,026
--------------- ---------------
SEMICONDUCTORS (0.6%)
3,300 Asyst Technologies 113 113
--------------- ---------------
SOFTWARE (17.7%)
2,600 Active Software 202 202
10,000 Bea Systems 494 494
2,700 Micromuse Inc. 447 447
6,300 Oracle Corp. 530 530
10,900 Peregrine Systems 378 378
5,100 Rational Software 474 474
1,700 Siebel Systems 278 278
3,700 VERITAS Software 418 418
--------------- ---------------
3,221 3,221
--------------- ---------------
2
<PAGE>
TECHNOLOGY (0.7%)
2,400 LSI Logic 130 130
--------------- ---------------
TECHNOLOGY- HARDWARE (2.9%)
3,800 Netopia, Inc. 153 153
2,800 SonicWALL, Inc. 247 247
2,100 Virata Corp. 125 125
--------------- --------------
525 525
--------------- --------------
TECHNOLOGY- SOFTWARE (1.1%)
2,600 Netegrity, Inc. 196 196
--------------- --------------
TELECOMMUNICATIONS (5.5%)
4,700 Metromedia Fiber Network 187 187
7,000 Nortel Networks 478 478
1,500 VoiceStream Wireless 174 174
4,600 WinStar Communications 156 156
--------------- --------------
995 995
--------------- --------------
TOTAL COMMON STOCKS (COST $14,646) 16,272 16,272
--------------- --------------
Principal Amount
---------------------
REPURCHASE AGREEMENTS (3.3%)
$ 598,000 State Street Bank and Trust Co. Repurchase Agreement,
6.65%, due 7/3/00, dated 6/30/00, Maturity Value $598,331,
Collateralized by $610,000 Fannie Mae, Notes, 6.40%,
due 9/27/01 (Collateral Value $616,863) (COST $598) 598 598
--------------- --------------
SHORT-TERM INVESTMENTS (6.9%)
1,250,000 Freddie Mac, Discount Notes, 6.57%,
due 7/3/00 (COST $1,249) 1,249 1,250
--------------- --------------
TOTAL INVESTMENTS (99.8%) $ 18,119 $ 18,120
=============== ==============
</TABLE>
(a) The proposed reorganization contemplates the merger of the funds and the
redemption in kind of the surviving fund's interest in the Technology Portfolio.
3
<PAGE>
Cash Reserves Portfolio
Pro Forma Combining Schedule of Investments
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Value
(000's
omitted)
As
Reported Pro Forma
----------
Income
Funds-
Principal Amount Cash
(000's omitted) Reserves Adjustments (a) Cash Reserves
------------------
<S> <C> <C> <C> <C>
Investment in Portfolio $1,105,633 $(1,105,633) $0
Investment in unaffiliated issuers and
non-controlled affiliated issuers
Rating
Moody's S&P
U.S. TREASURY SECURITIES (1.8%)
$ 5,000 U.S. Treasury Bills, 4.335%,
due 11/12/99 TSY TSY $ 4,994 $ 4,994
15,000 U.S. Treasury Notes, 5.50%,
due 2/29/00 TSY TSY 15,014 15,014
------------------ -------------
TOTAL U.S. TREASURY SECURITIES 20,008 20,008
------------------ -------------
U.S. GOVERNMENT AGENCY
SECURITIES (12.0%)
113,795 Freddie Mac, Discount Notes,
5.13%-5.20%,
due 11/12/99-1/27/00 AGY AGY 112,839 112,839
20,100 Federal Home Loan Bank, Bonds,
4.97%, due 2/16/00 AGY AGY 20,100 20,100
------------------ -------------
TOTAL U.S. GOVERNMENT AGENCY SECURITIES 132,939 132,939
------------------ -------------
ASSET-BACKED COMMERCIAL PAPER (2.7%)
29,500 Asset Securitization
Cooperative Corp., 6.0988%,
due 3/28/00 P-1 A-1+ 29,500 29,500
------------------ -------------
<PAGE>
CORPORATE COMMERCIAL PAPER (63.1%)
22,700 Grainger (W.W.) Inc., 5.25%,
due 11/1/99 P-1 A-1+ 22,700 22,700
8,080Kellogg Co., 5.28%,
due 11/1/99 P-1 A-1+ 8,080 8,080
25,000 National Australia Funding
Delaware Inc., 5.31%,
due 11/1/99 P-1 A-1+ 25,000 25,000
17,562 Northern Illinois Gas Co.,
5.22%, due 11/1/99 P-1 A-1+ 17,562 17,562
15,800 Bell Atlantic Network Funding
Corp., 5.29%, due 11/3/99 P-1 A-1+ 15,795 15,795
15,200 Colonial Pipeline Co., 5.30%,
due 11/3/99 P-1 A-1+ 15,196 15,196
19,825 BellSouth Telecommunications,
Inc., 5.30%, due 11/4/99 P-1 A-1+ 19,816 19,816
30,000 Motorola, Inc., 5.29%,
due 11/8/99 P-1 A-1 29,969 29,969
13,720 Halliburton Co., 5.28%,
due 11/9/99 P-1 A-1+ 13,704 13,704
14,600 Campbell Soup Co., 5.26%,
due 11/10/99 P-1 A-1+ 14,581 14,581
30,000 MetLife Funding, Inc., 5.30%,
due 11/2/99 & 11/10/99 P-1 A-1+ 29,972 29,972
25,000 Prudential Funding Corp.,
5.20%, due 11/10/99 P-1 A-1 24,967 24,967
35,090 Toyota Motor Credit Corp.,
5.22%-5.28%,
due 11/1/99-11/10/99 P-1 A-1+ 35,051 35,051
20,000 Sara Lee Corp., 5.30%,
due 11/12/99 P-1 A-1+ 19,968 19,968
25,000 Deutsche Bank Financial Inc.,
5.29%, due 11/15/99 P-1 A-1+ 24,949 24,949
22,200 New York Life Capital Corp.,
5.24%, due 11/15/99 P-1 A-1+ 22,155 22,155
6,000 Illinois Tool Works, Inc.,
5.30%, due 11/16/99 P-1 A-1+ 5,987 5,987
30,000 Merrill Lynch & Co., Inc.,
5.23% & 5.30%, due 11/4/99 & 11/16/99 P-1 A-1+ 29,951 29,951
30,000 Ford Motor Credit Co., 5.26%,
due 11/17/99 P-1 A-1 29,930 29,930
40,000 General Electric Capital
<PAGE>
Corp., 4.82% & 5.26%,
due 11/16/99 & 11/17/99 P-1 A-1+ 39,913 39,913
35,000 Abbott Laboratories, 5.25%,
due 11/18/99 P-1 A-1+ 34,913 34,913
20,000 ANZ (Delaware) Inc., 5.295%,
due 11/22/99 P-1 A-1+ 19,938 19,938
20,000 Swedish Export Credit Corp.,
5.25%, due 1/18/00 P-1 A-1+ 19,772 19,772
45,000 du Pont (E.I.) de Nemours &
Co., 5.29% & 5.67%,
due 11/5/99 & 2/10/00 P-1 A-1+ 44,591 44,591
31,345 Merck & Co., Inc., 5.25% &
5.30%, due 11/1/99 & 2/11/00 P-1 A-1+ 30,894 30,894
10,000 Canadian Wheat Board, Canada,
5.68%, due 2/14/00 P-1 A-1+ 9,834 9,834
20,000 Coca-Cola Co., 5.55%,
due 2/15/00 P-1 A-1+ 19,673 19,673
20,000 BellSouth Capital Funding
Corp., 5.32%, due 2/16/00 P-1 A-1+ 19,684 19,684
15,000 British Telecommunications
PLC, 5.70%, due 2/22/00 P-1 A-1+ 14,732 14,732
39,155 Morgan Stanley Dean Witter,
5.98%, due 2/25/00 P-1 A-1 38,401 38,401
------------------ -------------
TOTAL CORPORATE COMMERCIAL PAPER 697,678 697,678
------------------ -------------
TAXABLE REVENUE BONDS (2.0%)
11,000 Florida Housing Finance Corp.,
Revenue Bonds, Ser. 1999 A,
6.00%, due 3/2/00 MIG-1 A-1+ 11,000 11,000
11,585 Health Institute of Indiana,
Inc., Loan Program Notes,
Ser. A, 5.38%, VRDN
due 10/1/28 P-1 A-1 11,585 11,585
------------------ -------------
TOTAL TAXABLE REVENUE BONDS 22,585 22,585
------------------ -------------
CERTIFICATES OF DEPOSIT (9.4%)
15,000 Commerzbank AG, Yankee C.D.,
5.085%, due 2/16/00 P-1 A-1+ 14,998 14,998
30,000 UBS AG Stamford CT, Yankee
C.D., 5.29%, due 3/7/00 P-1 A-1+ 30,014 30,014
3,500 Canadian Imperial Bank of
Commerce, Yankee C.D., 5.18%,
<PAGE>
due 3/15/00 P-1 A-1+ 3,500 3,500
30,000 National Westminster Bank PLC,
Yankee C.D., 5.05% & 5.10%,
due 2/9/00 & 4/7/00 P-1 A-1+ 30,000 30,000
10,000 Bank of Montreal, Yankee C.D.,
5.12%, due 4/10/00 P-1 A-1+ 9,999 9,999
5,000 Rabobank Nederland, Yankee
C.D., 5.205%, due 5/15/00 P-1 A-1+ 4,999 4,999
10,000 Bayerische Hypo-und
Vereinsbank AG, Yankee C.D.,
5.345%, due 5/24/00 P-1 A-1+ 9,997 9,997
------------------ -------------
TOTAL CERTIFICATES OF DEPOSIT 103,507 103,507
------------------ -------------
CORPORATE DEBT SECURITIES (2.3%)
25,000American Express Centurion
Bank, Variable Rate Notes,
5.50%, due 5/8/00 P-1 A-1 25,000 25,000
------------------ -------------
FUNDING AGREEMENTS (6.3%)
30,000Hartford Life Insurance Co.,
Variable Rate Funding
Agreement, 5.44%, expiring 7/31/00 P-1 A-1 30,000 30,000
40,000Travelers Insurance Co.,
Variable Rate Funding
Agreement, 5.43% & 5.45%,
expiring 3/16/00 & 10/27/00 P-1 A-1+ 40,000 40,000
------------------ -------------
TOTAL FUNDING AGREEMENTS 70,000 70,000
------------------ -------------
TOTAL INVESTMENTS (99.6%) $ 1,101,217 $ 1,101,217
================= =============
</TABLE>
(a) The proposed reorganization contemplates the redemption in kind of the Cash
Reserves' interest in the Cash Reserves Portfolio.
<PAGE>
<TABLE>
<CAPTION>
GOVERNMENT MONEY PORTFOLIO
Pro Forma Combining Schedule of Investments
October 31, 1999 (unaudited)
Value (000's
omitted)
As Reported Pro Forma
---------------
Principal Income Funds- Government
Amount (000's Government Money
omitted) Money Fund Adjustments(a) Fund
-----------------------------------------
<S> <C> <C> <C>
Investment in Portfolio $ 653,867 $(653,867) $ 0
Investment in unaffiliated issuers and non-controlled
affiliated issuers
ANNUALIZED
YIELD AT DATE
OF PURCHASE
U.S. TREASURY
SECURITIES -- BACKED BY THE
FULL FAITH AND CREDIT OF THE
U.S. GOVERNMENT (99.3%)
$1,455 U.S. Treasury Bills,
due 11/4/99 4.55-4.77% $1,455 $1,455
82,330 U.S. Treasury Bills,
due 11/12/99 4.60-4.92% 82,212 82,212
5,000 U.S. Treasury Notes, 7.875%,
due 11/15/99 4.85% 5,006 5,006
<PAGE>
82,815 U.S. Treasury Bills,
due 11/18/99 4.60-4.80% 82,634 82,634
15,880 U.S. Treasury Bills,
due 11/26/99 4.92-4.95% 15,827 15,827
53,670 U.S. Treasury Notes, 7.75%,
due 11/30/99 4.68-4.96% 53,790 53,790
5,925 U.S. Treasury Bills,
due 12/2/99 4.84% 5,901 5,901
62,715 U.S. Treasury Bills,
due 12/9/99 4.74% 62,409 62,409
28,620 U.S. Treasury Bills,
due 12/16/99 4.78% 28,453 28,453
21,080 U.S. Treasury Bills,
due 12/23/99 4.69-4.79% 20,938 20,938
50,000 U.S. Treasury Bills,
due 12/30/99 4.82-4.85% 49,614 49,614
32,225 U.S. Treasury Bills,
due 1/6/00 4.78-5.03% 31,938 31,938
10,955 U.S. Treasury Bills,
due 1/13/00 5.00-5.08% 10,846 10,846
80,325 U.S. Treasury Notes, 7.75%,
due 1/31/00 5.02-5.21% 80,825 80,825
11,360 U.S. Treasury Bills,
due 2/10/00 5.04-5.11% 11,204 11,204
16,500 U.S. Treasury Notes, 5.875%,
due 2/15/00 5.15-5.17% 16,533 16,533
10,000 U.S. Treasury Notes, 7.125%,
due 2/29/00 5.13% 10,063 10,063
69,000 U.S. Treasury Notes, 5.50%,
due 2/29/00 5.18-5.21% 69,069 69,069
10,000 U.S. Treasury Notes, 6.875%,
due 3/31/00 5.09% 10,071 10,071
745 U.S. Treasury Bills,
due 4/20/00 5.29% 727 727
<PAGE>
------------- ------------
TOTAL INVESTMENTS (99.3%) $649,515 $649,515
============= ============
(a) The proposed reorganization contemplates the redemption in kind of the Government
Money Fund's interest in the Government Money Portfolio.
</TABLE>
<PAGE>
HIGH YIELD BOND PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET VALUE
(000'S OMITTED)
AS REPORTED PRO FORMA
--------------
AMOUNT INCOME FUND- HIGH YIELD
(000'S HIGH YIELD BOND
OMITTED) BOND FUND ADJUSTMENTS (a) FUND
--------------
<S> <C> <C> <C> <C>
Investment in Portfolio $ 24,022 $ (24,022) $ 0
Investment in unaffiliated issuers and
non-controlled affiliated issuers
RATING
U.S. GOVERNMENT AGENCY MOODY'S S&P
SECURITIES (6.7%)
$ 1,590 Freddie Mac, Discount Notes,
5.16%, due 11/1/99 AGY AGY $ 1,589 $ 1,589
25 Fannie Mae, Discount Notes,
5.21%, due 12/23/99 AGY AGY 25 25
---------------- ----------
TOTAL U.S. GOVERNMENT AGENCY
SECURITIES
(COST $1,614) 1,614 1,614
---------------- ----------
MORTGAGE-BACKED SECURITIES (4.7%) 425BA Mortgage Securities, Inc.,
Mortgage Pass-Through
Certificates, Ser. 1998-6,
6.25%, due 12/26/28 BB 278 278
498 GE Capital Mortgage Services,
Inc., REMIC Pass-Through
Certificates, Ser. 1999-11,
Class B3, 6.50%, due 7/25/29 BB 337 337
747 Morgan Stanley Capital I Inc.,
Commercial Mortgage
Pass-Through Certificates,
Ser. 1998-HF2, 6.01%,
due 11/15/30 BB 505 505
---------------- ----------
<PAGE>
TOTAL MORTGAGE-BACKED
SECURITIES (COST $1,147) 1,120 1,120
---------------- ----------
CORPORATE DEBT SECURITIES (86.0%)
500 Telecom Argentina Stet-France
SA, Medium-Term Notes, 9.75%,
due 7/12/01 B1 BBB- 499 499
450 Stone Container Corp., Senior
Subordinated Debentures,
12.25%, due 4/1/02 B3 B- 451 451
60 Core-Mark International, Inc.,
Senior Subordinated Notes,
11.375%, due 9/15/03 B3 B 58 58
60 Loomis Fargo & Co., Senior
Subordinated Notes, 10.00%,
due 1/15/04 B3 B 59 59
250 MTS, INC., Senior Subordinated
Notes, 9.375%, due 5/1/05 B2 B 174 174
210 Lodestar Holdings, Inc.,
Senior Notes, 11.50%,
due 5/15/05 Caa2 B 162 162
300 Vintage Petroleum, Inc.,
Senior Subordinated Notes,
9.00%, due 12/15/05 B1 B+ 296 296
340 MTL Inc., Senior Subordinated
Notes, 10.00%, due 6/15/06 B3 B- 320 320
470 Printpack, Inc., Senior
Subordinated Notes, Ser. B,
10.625%, due 8/15/06 Caa1 B 439 439
540 Motors and Gears, Inc., Senior
Notes, Ser. B, 10.75%,
due 11/15/06 B3 B 531 531
500 Pen-Tab Industries, Inc.,
Senior Subordinated Notes,
Ser. B, 10.875%, due 2/1/07 B3 B- 422 422
430 Fonda Group, Inc., Senior
Subordinated Notes, Ser. B,
9.50%, due 3/1/07 B3 B- 369 369
60 GFSI Inc., Senior Subordinated
Notes, 9.625%, due 3/1/07 B3 B- 45 45
500 Lyondell Chemical Co., Senior
Secured Notes, Ser. B, 9.875%,
<PAGE>
due 5/1/07 Ba3 BB 494 494
120 Doane Pet Care Co., Senior
Subordinated Notes, 9.75%,
due 5/15/07 B3 B- 115 115
500 French Fragrances, Inc.,
Senior Notes, Ser. B,
10.375%, due 5/15/07 B2 B+ 449 449
500 Hedstrom Corp., Senior
Subordinated Notes, 10.00%,
due 6/1/07 B3 B- 427 427
360 Venture Holdings Trust, Senior
Notes, 11.00%, due 6/1/07 B2 B 352 352
350 Stena AB, Senior Notes, 8.75%,
due 6/15/07 Ba2 BB 309 309
150 Polymer Group, Inc., Senior
Subordinated Notes, 9.00%,
due 7/1/07 B2 B 143 143
520 Safety Components
International, Inc., Senior
Subordinated Notes, 10.125%,
due 7/15/07 B3 B- 338 338
60 HydroChem Industrial Services,
Inc., Senior Subordinated
Notes, Ser. B, 10.375%,
due 8/1/07 Caa1 B- 52 52
125 Southern Foods Group, L.P.,
Senior Subordinated Notes,
9.875%, due 9/1/07 B2 B 131 131
310 NBTY, Inc., Senior
Subordinated Notes, Ser. B,
8.625%, due 9/15/07 B1 B+ 259 259
85 K & F Industries, Inc., Senior
Subordinated Notes, 9.25%,
due 10/15/07 B3 B- 83 83
290 Stellex Industries, Inc.,
Senior Subordinated Notes,
9.50%, due 11/1/07 Caa1 B- 211 211
60 United Defense, L.P., Senior
Subordinated Notes, 8.75%,
due 11/15/07 B2 B 57 57
290 Omnicare, Inc., Convertible
Subordinated Debentures,
5.00%, due 12/1/07 Ba3 BBB- 183 183
110 Amscan Holdings, Inc., Senior
<PAGE>
Subordinated Notes, 9.875%,
due 12/15/07 B3 B- 88 88
250 Fisher Scientific
International Inc., Senior
Subordinated Notes, 9.00%,
due 2/1/08 B3 B- 236 236
540 Brand Scaffold Services, Inc.,
Senior Notes, 10.25%,
due 2/15/08 B3 B- 486 486
400 Nextel Communications, Inc.,
Senior Redeemable Step Up
Notes, Yielding 10.926%,
due 2/15/08 B1 B- 284 284
300 APCOA, Inc., Senior
Subordinated Notes, 9.25%,
due 3/15/08 Caa1 B- 277 277
70 IMPAC Group, Inc., Senior
Subordinated Notes, 10.125%,
due 3/15/08 B3 B- 63 63
250 Musicland Group, Inc., Senior
Subordinated Notes, 9.875%,
due 3/15/08 B3 B- 211 211
520 Trans-Resources, Inc., Senior
Notes, Ser. B, 10.75%,
due 3/15/08 B3 B- 467 467
250 AMSC Acquisition Co., Inc.,
Senior Notes, Ser. B, 12.25%,
due 4/1/08 157 157
200 Columbus McKinnon Corp.,
Senior Subordinated Notes,
8.50%, due 4/1/08 B2 B 181 181
300 Great Central Mines Ltd.,
Senior Notes, 8.875%,
due 4/1/08 Ba2 BB 266 266
150 Numatics, Inc., Senior
Subordinated Notes, 9.625%,
due 4/1/08 B3 CCC+ 120 120
500 Riverwood International Corp.,
Senior Subordinated Notes,
10.875%, due 4/1/08 Caa1 CCC+ 484 484
200 Ultrapetrol (Bahamas) Ltd.,
First Preferred Ship Mortgage
Notes, 10.50%, due 4/1/08 B1 BB- 161 161
250 Hudson Respiratory Care Inc.,
<PAGE>
Senior Subordinated Notes,
9.125%, due 4/15/08 B3 B- 219 219
500 Level 3 Communications, Inc.,
Senior Notes, 9.125%,
due 5/1/08 B3 B 462 462
320 Sun Healthcare Group, Inc.,
Senior Subordinated Notes,
9.375%, due 5/1/08 Ca 39 39
300 Ziff-Davis Inc., Senior
Subordinated Notes, 8.50%,
due 5/1/08 B2 B 287 287
250 Great Lakes Carbon Corp.,
Senior Subordinated Notes,
10.25%, due 5/15/08 B3 B- 231 231
390 Home Products International,
Inc., Senior Subordinated
Notes, 9.625%, due 5/15/08 B3 B 346 346
300 La Petite Academy, Inc.,
Senior Notes, 10.00%,
due 5/15/08 B3 B- 248 248
200 Millar Western Forest Products
Ltd., Senior Notes, 9.875%,
due 5/15/08 B3 B+ 195 195
300 Telecommunications Techniques
Co., LLC, Senior Subordinated
Notes, 9.75%, due 5/15/08 B3 B- 285 285
350 Coyne International
Enterprises Corp., Senior
Subordinated Notes, 11.25%,
due 6/1/08 B3 B- 312 312
300 General Binding Corp., Senior
Subordinated Notes, 9.375%,
due 6/1/08 B2 B 242 242
500 AKI, Inc., Senior Notes,
10.50%, due 7/1/08 B2 B+ 481 481
300 Aqua-Chem, Inc., Senior
Subordinated Notes, 11.25%,
due 7/1/08 B3 CCC+ 194 194
250 Aurora Foods Inc., Senior
Subordinated Notes, 8.75%,
due 7/1/08 B1 B+ 237 237
340 Marsulex Inc., Senior
Subordinated Notes, 9.625%,
due 7/1/08 B2 B+ 330 330
<PAGE>
440 Bell Sports, Inc., Senior
Subordinated Notes, 11.00%,
due 8/15/08 B3 B- 441 441
500 DeCrane Aircraft Holdings,
Inc., Senior Subordinated
Notes, 12.00%, due 9/30/08 Caa1 B- 497 497
250 ICN Pharmaceuticals, Inc.,
Senior Notes, 8.75%,
due 11/15/08 Ba3 BB 231 231
250 True Temper Sports, Inc.,
Senior Subordinated Notes,
Ser. B, 10.875%, due 12/1/08 B3 B- 234 234
250 Bulong Operations Ltd., Senior
Secured Notes, 12.50%,
due 12/15/08 B3 B 242 242
500 Willis Corroon Corp., Senior
Subordinated Notes, 9.00%,
due 2/1/09 Ba3 B+ 441 441
100 AK Steel Corp., Senior Notes,
7.875%, due 2/15/09 Ba2 BB 91 91
250 Panolam Industries, Senior
Subordinated Notes, 11.50%,
due 2/15/09 B3 B- 256 256
500 Diamond Brands Inc., Senior
Step Up Debentures, Yielding
12.875%, due 4/15/09 Caa1 CCC+ 85 85
750 TeleCorp PCS, Inc., Senior
Subordinated Step Up Notes,
Yielding 11.625%, due 4/15/09 B3 460 460
200 Avis Rent A Car, Inc., Senior
Subordinated Notes, 11.00%,
due 5/1/09 B2 BB- 207 207
400 Dura Operating Corp., Senior
Subordinated Notes, 9.00%,
due 5/1/09 B2 B 371 371
500 MEDIQ Inc., Senior Step Up
Debentures, Yielding 13.00%,
due 6/1/09 Caa1 CCC+ 50 50
450 Falcon Products, Inc., Senior
Subordinated Notes, 11.375%,
due 6/15/09 B3 B 423 423
250 PSINet, Senior Notes, 11.00%,
due 8/1/09 B3 B- 256 256
250 United Pan-Europe
<PAGE>
Communications N.V., Senior
Notes, 10.875%, due 8/1/09 B2 B- 244 244
500 Williams Communications Group,
Inc., Senior Notes, 10.875%,
due 10/1/09 B2 BB- 513 513
160 Del Webb Corp., Senior
Subordinated Debentures,
10.25%, due 2/15/10 B2 B- 147 147
760 Charter Communications
Holdings, LLC, Senior Step Up
Notes, Yielding 9.225%,
due 4/1/11 B2 B+ 453 453
---------------- ----------
TOTAL CORPORATE DEBT
SECURITIES (COST $23,080) 20,659 20,659
---------------- ----------
WARRANTS (0.0%)
500 DeCrane Aircraft Holdings,
Inc. -- --
250 American Mobile Satellite 4 4
500 MEDIQ Inc. -- --
---------------- ----------
TOTAL WARRANTS (COST $0) 4 4
---------------- ----------
TOTAL INVESTMENTS (97.4%)
(COST $25,841) $ 23,397 $ 23,397
================ ==========
</TABLE>
(a) The proposed reorganization contemplates the redemption in kind of the High
Yield Bond Fund's interest in the High Yield Bond Portfolio.
<PAGE>
<TABLE>
<CAPTION>
INSTITUTIONAL CASH PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
JUNE 30, 2000 (UNAUDITED)
VALUE (000'S OMITTED)
AS REPORTED PRO FORMA
----------- ---------
PRINCIPAL INCOME TRUST-
AMOUNT INSTITUTIONAL INSTITUTIONAL
(000'S OMITTED) CASH TRUST ADJUSTMENTS(A) CASH TRUST
<S> <C> <C> <C>
Investment in Portfolio $ 326,686 $ (326,686) $ 0
Investment in unaffiliated issuers and non-controlled affiliated issuers
RATING
MOODY'S S&P
CERTIFICATES OF DEPOSIT (0.8%)
$2,500 First Union National Bank of NC,
7.00%, due 11/22/00 P-1 A-1 $ 2,500 $ 2,500
-------- -------
CORPORATE COMMERCIAL PAPER (94.4%)
4,000 ANZ (DE) Inc., 6.64%, due 12/4/00 P-1 A-1+ 3,886 3,886
2,900 American Express Credit Corp., 6.75%, due 7/7/00 P-1 A-1 2,898 2,898
5,500 AT&T Corp., 6.60%, due 7/11/00 P-1 A-1+ 5,492 5,492
10,000 Anheuser-Busch Cos. Inc., 6.58%, due 10/20/00 P-1 A-1+ 9,801 9,801
2,000 Asset Securitization Cooperative Corp., 6.55%,
due 8/3/00 P-1 A-1+ 1,989 1,989
10,000 Asset Securitization Cooperative Corp., 6.57%,
due 9/8/00 P-1 A-1+ 9,878 9,878
10,000 British Telecommunications PLC, 6.78%, due 11/9/00 P-1 A-1+ 9,757 9,757
2,000 Ciesco L.P., 6.53%, due 7/6/00 P-1 A-1+ 1,999 1,999
2,000 Corporate Asset Funding Co., Inc., 6.53%, due 7/7/00 P-1 A-1+ 1,999 1,999
10,000 Deutsche Bank Financial Inc., 6.57%, due 9/6/00 P-1 A-1+ 9,881 9,881
2,000 Diageo Capital PLC, 6.47%, due 7/24/00 P-1 A-1 1,992 1,992
5,000 DuPont (E.I.) de Nemours & Co., 6.61%, due 12/4/00 P-1 A-1+ 4,859 4,859
1,500 DuPont (E.I.) de Nemours & Co., 6.55%, due 8/2/00 P-1 A-1+ 1,492 1,492
3,000 Eksportfinans ASA, 6.62%, due 8/25/00 P-1 A-1+ 2,971 2,971
10,000 Electricite de France, 6.87%, due 7/5/00 P-1 A-1+ 9,996 9,996
10,000 Emerson Electric, 6.73%, due 7/6/00 P-1 A-1+ 9,994 9,994
<PAGE>
9,000 Enterprise Funding Corp., 6.56%, due 7/17/00 P-1 A-1+ 8,977 8,977
7,000 Ford Motor Credit Co., 6.72%, due 7/5/00 P-1 A-1 6,997 6,997
2,000 Gannett Co., 6.50%, due 8/8/00 P-1 A-1+ 1,987 1,987
12,000 General Electric Capital Corp., 6.76%, due 11/29/00 P-1 A-1+ 11,664 11,664
2,000 Goldman Sachs & Co., 6.57%, due 7/5/00 P-1 A-1+ 1,999 1,999
4,010 Goldman Sachs & Co., 6.60%, due 10/16/00 P-1 A-1+ 3,933 3,933
3,075 Govco Inc., 6.85%, due 7/10/00 P-1 A-1+ 3,071 3,071
2,000 Govco Inc., 6.60%, due 8/7/00 P-1 A-1+ 1,987 1,987
7,000 Govco Inc., 6.57%, due 8/22/00 P-1 A-1+ 6,936 6,936
5,000 Halliburton Co., 6.55%, due 9/18/00 P-1 A-1+ 4,930 4,930
10,000 H.J. Heinz Co., 6.83%, due 7/3/00 P-1 A-1 10,000 10,000
1,000 Illinois Tool Works, 6.53%, due 7/5/00 P-1 A-1+ 1,000 1,000
10,000 Lloyd's TSB Bank PLC, 6.74%, due 12/4/00 P-1 A-1+ 9,712 9,712
7,545 McDonald's Corp., 6.70%, due 7/6/00 P-1 A-1+ 7,541 7,541
2,000 Merrill Lynch & Co., 6.53%, due 9/5/00 P-1 A-1+ 1,977 1,977
10,000 Merrill Lynch & Co., 6.75%, due 11/17/00 P-1 A-1+ 9,743 9,743
2,680 Minnesota Mining & Manufacturing Co., 6.55%,
due 8/22/00 P-1 A-1+ 2,656 2,656
7,415 Monte Rosa Capital Corp., 6.55%, due 7/13/00 P-1 A-1+ 7,402 7,402
2,000 Monte Rosa Capital Corp., 6.50%, due 7/17/00 P-1 A-1+ 1,995 1,995
1,000 Morgan Stanley Dean Witter, 6.55%, due 7/17/00 P-1 A-1 997 997
10,000 National Rural Utilities Coop. Finance Corp., 6.62%, due 12/15/00 P-1 A-1+ 9,697 9,697
2,000 Private Export Funding Corp., 6.45%, due 7/6/00 P-1 A-1+ 1,999 1,999
5,000 Prudential Funding Corp., 6.60%, due 11/29/00 P-1 A-1 4,863 4,863
10,000 Receivables Capital Corp., 6.65%, due 11/10/00 P-1 A-1+ 9,760 9,760
10,000 Riverwoods Funding Corp., 6.75%, due 7/7/00 P-1 A-1+ 9,992 9,992
3,000 SBC Communications Inc., 6.53%, due 7/7/00 P-1 A-1+ 2,998 2,998
5,000 SBC Communications Inc., 6.62%, due 12/14/00 P-1 A-1+ 4,849 4,849
10,000 Surrey Funding Corp., 6.75%, due 7/7/00 P-1 A-1+ 9,992 9,992
2,000 Surrey Funding Corp., 6.60%, due 7/7/00 P-1 A-1+ 1,999 1,999
5,000 Toyota Motor Credit Corp., 6.51%, due 7/18/00 P-1 A-1+ 4,986 4,986
12,000 UBS Finance (DE), Inc., 6.65%, due 7/5/00 P-1 A-1+ 11,996 11,996
6,850 USAA Capital Corp., 6.57%, due 9/14/00 P-1 A-1 6,759 6,759
10,300 Union Electric, 6.95%, due 7/3/00 P-1 A-1+ 10,300 10,300
10,000 Wal-Mart Stores Inc., 6.50%, due 7/5/00 P-1 A-1+ 9,996 9,996
2,000 Washington Post Co., 6.51%, due 7/5/00 P-1 A-1+ 1,999 1,999
10,000 Windmill Funding Corp., 6.54%, due 7/14/00 P-1 A-1+ 9,980 9,980
2,000 Windmill Funding Corp., 6.56%, due 8/7/00 P-1 A-1+ 1,987 1,987
-------- -------
TOTAL CORPORATE COMMERCIAL PAPER 308,540 308,540
-------- -------
TAXABLE REVENUE BONDS (1.7%)
915 California Housing Finance Agency, Revenue Bonds,
Ser. T, 6.80%, VRDN due 8/1/29 MIG-1 A1+ 915 915
1,400 Florida Housing Finance Revenue Bonds, Ser. 1993,
6.55%, VRDN due 1/1/34 MIG-1 A1+ 1,400 1,400
<PAGE>
1,200 Los Angeles (CA) Multifamily Revenue Bonds,
Ser. 1999 Q, 6.60%, VRDN due 4/15/33 MIG-1 A1+ 1,200 1,200
2,000 Riverside Co., (CA) Certificate of Participation,
Ser. 1997, 6.85%, VRDN due 1/1/27 MIG-1 A1+ 2,000 2,000
-------- --------
TOTAL TAXABLE REVENUE BONDS 5,515 5,515
-------- --------
TIME DEPOSITS (3.1%)
10,000 Sun Trust Bank Inc., 6.88%, due 7/3/00 P-1 A-1 10,000 10,000
-------- --------
TOTAL INVESTMENTS (100.0%) $326,555 $326,555
======== ========
</TABLE>
(a) The proposed reorganization contemplates the redemption in kind of the
Institutional Cash Trust's interest in the Institutional Cash Portfolio.
<PAGE>
<TABLE>
<CAPTION>
LIMITED MATURITY BOND PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999 (UNAUDITED)
MARKET VALUE
(000'S
OMITTED)
AS REPORTED PRO FORMA
----------- ---------
INCOME TRUST-
FUNDS- LIMITED
PRINCIPAL LIMITED MATURITY LIMITED
AMOUNT (000'S MATURITY BOND MATURITY
OMITTED) BOND FUND TRUST ADJUSTMENTS(A) BOND FUND
-------------
<S> <C> <C> <C> <C> <C>
Investment in Portfolio $228,422 $ 41,705 $ (270,127) $ 0
Investment in unaffiliated issuers and non-controlled
affiliated issuers
RATING
MOODY'S S&P
U.S. TREASURY SECURITIES (7.6%)
$ 7,750 U.S. Treasury Notes, 5.25%,
due 5/15/04 TSY TSY $ 7,526 $ 7,526
8,700 U.S. Treasury Notes, 6.50%,
due 10/15/06 TSY TSY 8,850 8,850
4,371 U.S. Treasury
Inflation-Indexed Notes,
3.375%, due 1/15/07 TSY TSY 4,167 4,167
----- -----
TOTAL U.S. TREASURY SECURITIES
(COST $20,678) 20,543 20,543
------ ------
U.S. GOVERNMENT AGENCY
SECURITIES (1.5%)
4,175 Freddie Mac, Discount Notes,
5.16%, due 11/1/99
(COST $4,174) AGY AGY 4,174 4,174
----- -----
<PAGE>
MORTGAGE-BACKED SECURITIES (30.1%)
1,480 GE Capital Mortgage Services,
Inc., REMIC Pass-Through
Certificates, Ser. 1998-25,
Class B3, 6.25%, due 12/25/28 BB 974 974
1,588 PNC Mortgage Securities Corp.,
Pass-Through Certificates,
Ser. 1999-1, Class 1B4, 6.25%,
due 2/25/29 BB 1,034 1,034
946 Norwest Asset Securities
Corp., Mortgage Pass-Through
Certificates, Ser. 1999-13,
6.75%, due 5/25/29 BB 652 652
1,110 GE Capital Mortgage Services,
Inc., REMIC Pass-Through
Certificates, Ser. 1999-11,
Class B3, 6.50%, due 7/25/29 BB 751 751
965 Morgan Stanley Capital I Inc.,
Commercial Mortgage
Pass-Through Certificates,
Ser. 1998-HF2, 6.01%,
due 11/15/30 BB 653 653
FANNIE MAE
4,305 Pass-Through Certificates,
7.00%, due 9/1/03 & 6/1/11 AGY AGY 4,329 4,329
5,136 Pass-Through Certificates,
6.50%, due 5/1/13 AGY AGY 5,046 5,046
FREDDIE MAC
25 Mortgage Participation
Certificates, 10.50%,
due 10/1/00 & 12/1/00 AGY AGY 26 26
135 Mortgage Participation
Certificates, 8.50%,
due 10/1/01 AGY AGY 138 138
122 ARM Certificates, 6.00%,
due 1/1/17 AGY AGY 122 122
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
69 Pass-Through Certificates,
7.50%, due 10/15/09-9/15/10 AGY AGY 70 70
113 Pass-Through Certificates,
12.00%, due 5/15/12-3/15/15 AGY AGY 128 128
22,191 Pass-Through Certificates,
6.50%, due 12/15/28 AGY AGY 21,223 21,223
34,921 Pass-Through Certificates,
7.00%, due 4/15/11-1/15/29 AGY AGY 34,314 34,314
<PAGE>
2,960 Pass-Through Certificates,
8.00%, due 11/15/26-7/15/29 AGY AGY 3,022 3,022
8,700 Pass-Through Certificates,
8.00%, TBA, 30 Year Maturity AGY AGY 8,890 8,890
----- -----
TOTAL MORTGAGE-BACKED SECURITIES
(COST $84,272) 81,372 81,372
------ ------
ASSET-BACKED SECURITIES (7.0%)
6,500 Ford Credit Auto Loan Master
Trust, Auto Loan Certificates,
Ser. 1996-1, 5.50%,
due 2/15/03 Aaa AAA 6,455 6,455
111 Honda Auto Receivables Grantor
Trust, Ser. 1997-A, Class A,
5.85%, due 2/15/03 Aaa AAA 110 110
5,600 Chase Credit Card Master
Trust, Ser. 1997-2, Class A,
6.30%, due 4/15/03 Aaa AAA 5,618 5,618
792 Navistar Financial Owner
Trust, Ser. 1996-B,
Class A-3, 6.33%, due 4/21/03 Aaa AAA 794 794
4,720 Chemical Master Credit Card
Trust 1, Ser. 1995-2,
Class A, 6.23%, due 6/15/03 Aaa AAA 4,727 4,727
1,112 Chevy Chase Auto Receivables
Trust, Ser. 1996-2, Class A,
5.90%, due 7/15/03 Aaa AAA 1,110 1,110
----- -----
TOTAL ASSET-BACKED SECURITIES
(COST $18,905) 18,814 18,814
------ ------
BANKS & FINANCIAL INSTITUTIONS (16.9%)
1,300 Lehman Brothers Holdings Inc.,
Medium-Term Notes, Ser. E,
7.08%, due 5/22/00 A3 A 1,307 1,307
1,800 International Lease Finance
Corp., Notes, 6.625%,
due 6/1/00 A1 A+ 1,806 1,806
3,150 Countrywide Funding Corp.,
Medium-Term Notes, Ser. A,
7.31%, due 8/28/00 A3 A 3,174 3,174
7,090 Associates Pass-Through Asset
Trust, Ser. 1997-1, 6.45%,
due 9/15/00 Aa3 AA- 7,138 7,138
<PAGE>
5,000 Lehman Brothers Holdings Inc.,
Medium-Term Notes, Ser. E,
6.89%, due 10/10/00 A3 A 5,032 5,032
3,600 Countrywide Home Loans, Inc.,
Notes, 5.62%, due 10/16/00 A3 A 3,571 3,571
1,725 Lehman Brothers Holdings Inc.,
Medium-Term Notes, Ser. E,
6.65%, due 11/8/00 A3 A 1,733 1,733
2,000 NationsBank Corp., Senior
Medium-Term Notes, Ser. E,
5.70%, due 2/9/01 Aa2 A+ 1,982 1,982
6,600 Capital One Bank, Bank Notes,
5.95%, due 2/15/01 Baa2 BBB- 6,512 6,512
4,430 Morgan Stanley, Dean Witter, &
Co., Global Medium-Term Notes,
Ser. C, 6.09%, due 3/9/01 Aa3 A+ 4,401 4,401
6,660 Household Finance Corp.,
Senior Medium-Term Notes,
6.06%, due 5/14/01 A2 A 6,585 6,585
1,500 Dime Bancorp, Inc., Notes,
7.00%, due 7/25/01 Ba1 BBB- 1,494 1,494
1,000 Bank United Corp., Medium-Term
Notes, Ser. A, 8.00%,
due 3/15/09 Ba2 BBB- 950 950
- --- ---
TOTAL BANKS & FINANCIAL INSTITUTIONS
(COST $45,950) 45,685 45,685
------ ------
CORPORATE DEBT SECURITIES (32.6%)
4,800 Norfolk Southern Corp., Notes,
6.70%, due 5/1/00 Baa1 BBB+ 4,814 4,814
2,000 American General Finance
Corp., Senior Notes, 6.125%,
due 9/15/00 A2 A+ 2,002 2,002
2,510 Chesapeake Corp., Notes,
10.375%, due 10/1/00 Ba1 BBB 2,595 2,595
1,730 BHP Finance (USA) Ltd.,
Guaranteed Notes, 5.625%,
due 11/1/00 A3 A- 1,711 1,711
2,577 Safeway Inc., Notes, 5.75%,
due 11/15/00 Baa2 BBB 2,554 2,554
2,300 General Electric Capital
Corp., Global Medium-Term
Notes, Ser. A, 5.52%,
due 1/15/01 Aaa AAA 2,280 2,280
<PAGE>
3,325 AT&T Capital Corp., Notes,
6.875%, due 1/16/01 A1 BBB 3,333 3,333
2,320 Fort James Corp., Notes,
6.234%, due 3/15/01 Baa2 BBB 2,309 2,309
1,780 CMS Energy Corp., Senior
Notes, 8.00%, due 7/1/01 Ba3 BB 1,775 1,775
3,300 Telecom Argentina Stet-France
SA, Medium-Term Notes, 9.75%,
due 7/12/01 B1 BBB- 3,292 3,292
2,290 Colonial Realty Limited
Partnership, Senior Notes,
7.50%, due 7/15/01 Baa3 BBB- 2,253 2,253
1,220 USA Waste Services, Inc.,
Senior Notes, 6.125%,
due 7/15/01 Ba1 BBB 1,164 1,164
1,325 Cox Communications, Inc.,
Notes, 7.00%, due 8/15/01 Baa2 BBB+ 1,326 1,326
3,300 Texas Utilities Co., Notes,
5.94%, due 10/15/01 Baa3 BBB 3,243 3,243
2,080 Tyco International Ltd.,
Notes, 6.50%, due 11/1/01 A3 A- 2,059 2,059
1,923 Marlin Water Trust, Senior
Secured Notes, 7.09%,
due 12/15/01 Baa2 BBB 1,896 1,896
2,965 ICI Wilmington Inc.,
Guaranteed Notes, 7.50%,
due 1/15/02 Baa1 A- 2,992 2,992
2,835 Black & Decker Corp.,
Medium-Term Notes, Ser. A,
8.90%, due 1/21/02 Baa2 BBB 2,956 2,956
945 Century Communications Corp.,
Senior Notes, 9.75%,
due 2/15/02 B1 BB- 958 958
900 Ford Motor Credit Co., Global
Bonds, 6.50%, due 2/28/02 A1 A 896 896
900 Comdisco, Senior Notes, 7.25%,
due 9/1/02 Baa1 BBB+ 894 894
3,195 Crown Cork & Seal Co., Inc.,
Notes, 7.125%, due 9/1/02 Baa2 BBB 3,171 3,171
2,280 Fort James Corp., Senior
Notes, 6.50%, due 9/15/02 Baa2 BBB 2,247 2,247
2,460 Conseco Inc., Notes, 8.50%,
due 10/15/02 Ba1 BBB+ 2,468 2,468
<PAGE>
1,375 American Standard Inc., Senior
Notes, 7.125%, due 2/15/03 Ba3 BB- 1,303 1,303
1,000 Safeway Inc., Medium-Term
Notes, 8.57%, due 4/1/03 Baa2 BBB 1,038 1,038
3,360 Stewart Enterprises, Inc.,
Notes, 6.40%, due 5/1/03 Baa3 BBB 3,306 3,306
60 Core-Mark International, Inc.,
Senior Subordinated Notes,
11.375%, due 9/15/03 B3 B 58 58
2,555 Akzo Nobel Inc., Guaranteed
Notes, 6.00%, due 11/15/03 A2 A 2,438 2,438
705 Loomis Fargo & Co., Senior
Subordinated Notes, 10.00%,
due 1/15/04 B3 B 689 689
1,740 PDVSA Finance Ltd., Notes,
8.75%, due 2/15/04 A3 1,701 1,701
660 EOP Operating Limited
Partnership, Notes, 6.625%,
due 2/15/05 Baa1 BBB+ 625 625
975 WestPoint Stevens Inc., Senior
Notes, 7.875%, due 6/15/05 Ba3 BB 914 914
4,200 Heritage Media Corp., Senior
Subordinated Notes, 8.75%,
due 2/15/06 B1 BB+ 4,273 4,273
735 Calpine Corp., Senior Notes,
7.625%, due 4/15/06 Ba1 BB+ 689 689
325 Jones Apparel Group, Senior
Notes, 7.875%, due 6/15/06 Baa2 BBB- 321 321
400 Printpack, Inc., Senior
Subordinated Notes, Ser. B,
10.625%, due 8/15/06 Caa1 B 374 374
2,825 Time Warner Inc., Notes,
8.11%, due 8/15/06 Baa3 BBB 2,935 2,935
680 Newport News Shipbuilding
Inc., Senior Subordinated
Notes, 9.25%, due 12/1/06 B1 B+ 699 699
910 GFSI Inc., Senior Subordinated
Notes, 9.625%, due 3/1/07 B3 B- 689 689
300 French Fragrances, Inc.,
Senior Notes, Ser. B,
10.375%, due 5/15/07 B2 B+ 269 269
1,685 Owens-Illinois, Inc., Senior
Debentures, 8.10%,
due 5/15/07 Ba1 BB+ 1,616 1,616
<PAGE>
250 Safety Components
International, Inc., Senior
Subordinated Notes, 10.125%,
due 7/15/07 B3 B- 163 163
880 HydroChem Industrial Services,
Inc., Senior Subordinated
Notes, Ser. B, 10.375%,
due 8/1/07 Caa1 B- 767 767
2,000 Interpool, Inc., Notes, 7.20%,
due 8/1/07 Ba1 BB+ 1,703 1,703
400 NBTY, Inc., Senior
Subordinated Notes, Ser. B,
8.625%, due 9/15/07 B1 B+ 334 334
1,000 Thiokol Corp., Senior Notes,
6.625%, due 3/1/08 Baa3 BBB 921 921
160 APCOA, Inc., Senior
Subordinated Notes, 9.25%,
due 3/15/08 Caa1 B- 148 148
610 IMPAC Group, Inc., Senior
Subordinated Notes, 10.125%,
due 3/15/08 B3 B- 546 546
470 Trans-Resources, Inc., Senior
Notes, Ser. B, 10.75%,
due 3/15/08 B3 B- 422 422
300 Columbus McKinnon Corp.,
Senior Subordinated Notes,
8.50%, due 4/1/08 B2 B 272 272
160 Great Central Mines Ltd.,
Senior Notes, 8.875%,
due 4/1/08 Ba2 BB 142 142
1,000 Global Crossing Holdings Ltd.,
Senior Notes, 9.625%,
due 5/15/08 Ba2 BB 1,010 1,010
450 Home Products International,
Inc., Senior Subordinated
Notes, 9.625%, due 5/15/08 B3 B 399 399
205 KinderCare Learning Centers,
Inc., Senior Subordinated
Notes, Ser. B, 9.50%,
due 2/15/09 B3 B- 193 193
1,500 Liberty Media Group, Notes,
7.875%, due 7/15/09 Baa3 BBB- 1,506 1,506
500 Garden State Newspapers, Inc.,
Senior Subordinated Notes,
Ser. B, 8.625%, due 7/1/11 B1 B+ 450 450
--- ---
<PAGE>
TOTAL CORPORATE DEBT SECURITIES
(COST $90,976) 88,101 88,101
------ ------
FOREIGN SECURITIES (5.8%)
CAD 5,665 Canadian Government, 5.00%,
due 12/1/00 Aaa AAA 3,823 3,823
SEK 41,100 Kingdom of Sweden, 13.00%,
due 6/15/01 Aaa AAA 5,637 5,637
AUD 10,100 Asian Development Bank,
5.375%, due 9/15/03 Aaa AAA 6,140 6,140
----- -----
TOTAL FOREIGN SECURITIES (COST $16,055) 15,600 15,600
------ ------
TOTAL INVESTMENTS (101.5%)
(COST $281,010) $ 274,289 $274,289
========= ========
(a) The proposed reorganization contemplates the merger of the funds and the
redemption in kind of the surviving fund's interest in the Limited Maturity Bond
Portfolio. Because liabilities exceeded assets other than Investments at the
Portfolio level, certain of the investments being transferred would have been
liquidated.
</TABLE>
<PAGE>
Municipal Money Portfolio
Pro Forma Combining Schedule of Investments
October 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Value
(000's
omitted)
As
Reported Pro Forma
-------- ---------
Principal Amount (000's Funds-
omitted) Municipal Adjustments (a) Municipal Money Fund
Money
Fund
<S> <C> <C> <C> <C>
Investment in Portfolio $ 293,992 $ (293,992) $ 0
Investment in unaffiliated issuers and
non-controlled affiliated issuers
Rating
Moody's S&P
TAX-EXEMPT
SECURITIES -- PRE-REFUNDED
BACKED BY U.S. GOVERNMENT
SECURITIES (7.4%)
$ 1,500Baltimore (MD) Wtr. Util. Rev.
(Wtr. Proj.), Ser. 1990 A,
6.50%, due 7/1/20 P/R 7/1/00 $ 1,525 $ 1,525
1,000Clark Co. (NV) Sch. Dist.
G.O., Ser. 1990, 7.50%,
due 5/1/04 P/R 5/1/00 1,038 1,038
2,000Grapevine-Colleyville (TX)
Independent Sch. Dist. G.O.,
Ser. 1989, 6.60%, due 8/15/02
P/R 8/15/00 2,046 2,046
3,000Maryland St. Hlth. & Higher
Ed. Fac. Au. Rev. (Francis
Scott Key Med. Ctr.),
Ser. 1990, 6.75%, due 7/1/23
P/R 7/1/00 3,122 3,122
2,000Massachusetts Wtr. Res. Au.
<PAGE>
Rev., Ser. 1990 A, 6.00%,
due 4/1/20 P/R 4/1/00 2,019 2,019
2,000Mobile Co. (AL) G.O.,
Ser. 1991, 6.70%, due 2/1/11
P/R 2/1/00 2,057 2,057
1,000New Hampshire Cap. Imp. G.O.,
Ser. 1989, 6.50%, due 12/1/09
P/R 1/15/00 1,026 1,026
1,500Pennsylvania Higher Ed. Fac.
Au. Rev., Ser. 1990 D, 7.15%,
due 6/15/15 P/R 6/15/00 1,534 1,534
1,150Rhode Island & Providence
Plantations Cons. Cap. Dev.
Loan G.O., Ser. 1991 B, 6.00%,
due 5/15/02 P/R 5/15/00 1,187 1,187
2,000South Carolina Cap. Imp. G.O.,
Ser. 1991 W, 5.75%,
due 5/1/06 P/R 5/1/00 2,063 2,063
1,000Washington Co. (PA) Au. Muni.
Fac. Lease Rev. (Shadyside
Hosp. Proj.), Ser. 1985 C-1B,
7.38%, due 12/15/09 P/R 6/15/00 1,054 1,054
3,000Washington St. G.O.,
Ser. 1990 B, 6.80%,
due 8/1/04 P/R 8/1/00 3,065 3,065
-------------- ------------
21,736 21,736
-------------- ------------
TAX-EXEMPT
SECURITIES -- ESCROWED IN U.S.
GOVERNMENT SECURITIES (2.4%)
1,225Milwaukee (WI) Metro. Swr.
Dist. G.O., Ser. 1990 A,
6.70%, due 10/1/00 1,257 1,257
1,200Milwaukee Co. (WI) Corp. Purp.
G.O., Ser. 1993 A, 4.60%,
due 12/1/99 1,201 1,201
1,000New York St. Pwr. Au. Gen.
Purp. Rev., Ser. 1991 Z,
5.85%, due 1/1/00 1,005 1,005
2,625Pennsylvania Convention Ctr.
Au. Rev., Ser. 1989 A, 6.60%,
due 9/1/00 2,689 2,689
1,000Texas Muni. Pwr. Agcy. Ref.
<PAGE>
Rev., Ser. 1992, 5.50%,
due 9/1/00 1,013 1,013
-------------- ------------
7,165 7,165
-------------- ------------
MUNICIPAL NOTES (2.2%)
1,000Louisiana Pub. Fac. Au.
Advance Funding Notes,
Ser. 1999 B, 4.25%,
due 10/24/00 SP-1+ 1,004 1,004
2,500Racine Co. (WI) Unified Sch.
Dist. TRANS, 3.60%,
due 7/6/00 MIG 1 2,502 2,502
1,000Rockdale Co. (GA) Wtr. & Swr.
Au. Cap. Outlay Notes, 3.75%,
due 12/15/99 MIG 1 1,000 1,000
2,000Texas TRANS, Ser. 1999 A,
4.50%, due 8/31/00 VMIG 1 SP-1+ 2,013 2,013
-------------- ------------
6,519 6,519
-------------- ------------
TAX-EXEMPT SECURITIES --BACKED
BY LETTERS OF CREDIT (1.4%)
MORGAN GUARANTY TRUST CO.
3,000Chicago (IL) G.O., Ser. 1998,
3.75%, due 1/31/00 Putable 12/1/99 VMIG 1 A-1+ 3,000 3,000
STATE STREET BANK AND TRUST COMPANY
1,000Rhode Island Std. Loan Au.
Prog. Rev., Ser. 1996-1,
3.60%, due 6/1/26 Putable 6/1/00 A-1+ 1,000 1,000
-------------- ------------
4,000 4,000
-------------- ------------
TAX-EXEMPT SECURITIES --BACKED
BY INSURANCE (4.3%)
AMERICAN MUNICIPAL BOND ASSURANCE CORP.
1,000Anchorage (AK) Sch. G.O.,
Ser. 1996 A, 5.50%,
due 8/1/00 1,013 1,013
2,000Atlanta (GA) Sales Tax Rev.
(Metro. Atlanta Rapid Transit
Au.), Ser. 1993 A, 4.90%,
due 7/1/00 A-1+ 2,021 2,021
1,250Franklin & Pickaway Cos. (OH)
<PAGE>
South-Western City Sch. Dist.
Sch. Bldg. Construction
Unlimited Tax G.O., 3.00%,
due 12/1/99 1,250 1,250
1,000Lower Colorado River (TX) Au.
Priority Ref. Rev., Ser. 1991
A, 6.375%, due 1/1/00 A-1+ 1,005 1,005
3,330Missouri Cert. of
Participation (Bonne Terre
Prison Proj.), Ser. 1999 A,
4.25%, due 6/1/00 3,348 3,348
FINANCIAL GUARANTY INSURANCE CO.
1,000Clark Co. (NV) Sch. Dist. Sch.
Imp. Ltd. Tax G.O.,
Ser. 1996, 6.50%, due 6/15/00 1,019 1,019
1,000Connecticut Spec. Assessment
Unemployment Comp. Adv. Fund
Rev., Ser. 1993 C, 3.38%,
due 11/15/01 Putable 7/1/00 VMIG 1 A-1+ 1,000 1,000
MUNICIPAL BOND INVESTORS ASSURANCE CORP.
1,000New Mexico St. Univ. Ref. &
Imp. Rev., Ser. 1998, 3.95%,
due 4/1/00 1,002 1,002
1,000Portland (OR) Swr. Sys. Rev.,
Ser. 1998 A, 5.00%,
due 6/1/00 1,008 1,008
-------------- ------------
12,666 12,666
-------------- ------------
TAX-EXEMPT SECURITIES -- OTHER (8.3%)
1,000Albuquerque (NM) G.O.,
Ser. 1994 A, 4.70%,
due 7/1/00 1,009 1,009
1,585Arlington (TX) Perm. Imp.
G.O., Ser. 1999, 4.00%,
due 8/15/00 1,591 1,591
1,125Commonwealth of Virginia G.O.,
Ser. 1999, 4.75%, due 6/1/00 1,131 1,131
1,000Cook Co. (IL) Metro. Wtr.
Reclamation Dist. of Greater
Chicago Ref. G.O., Ser. 1997,
4.15%, due 12/1/99 1,001 1,001
1,000Fort Worth (TX) Tarrant &
<PAGE>
Denton Cos. Gen. Purp. Ref.
G.O., Ser. 1996 A, 5.50%,
due 3/1/00 1,008 1,008
1,000Fulton Co. (GA) Sch. Dist.
G.O., Ser. 1991, 5.80%,
due 5/1/00 1,012 1,012
1,500Georgia St. G.O., Ser. 1991 A,
7.70%, due 2/1/00 1,514 1,514
1,315Horry Co. (SC) Sch. Dist.
G.O., Ser. 1999 B, 4.50%,
due 3/1/00 1,319 1,319
1,200Kansas Dept. of Trans. Hwy.
Rev., Ser. 1992, 5.90%,
due 3/1/00 1,211 1,211
1,000Minnesota St. Var. Purp. Ref.
G.O., 4.50%, due 6/1/00 1,005 1,005
3,000Minnesota Tax & Aid
Anticipation Borrowing Prog.
Cert. of Participation Tax
Anticipation G.O., Ser. 1999
A, 3.00%, due 2/3/00 MIG 1 3,000 3,000
1,500Nashville & Davidson Co. (TN)
Metro. Gov't. Multi-Purp. Imp.
G.O., Ser. 1997 A, 5.125%,
due 11/15/99 1,501 1,501
3,000Oklahoma Wtr. Res. Board Rev.
(Std. Loan Prog.), Ser. 1999,
3.60%, due 9/1/32 Putable 3/1/2000 A-1+ 3,000 3,000
1,235South Carolina Cap. Imp. G.O.,
Ser. 1991 W, 6.00%,
due 5/1/00 1,251 1,251
2,000Tempe (AZ) Excise Tax Rev.,
Ser. 1999 A, 3.75%,
due 7/1/00 MIG 1 SP-1+ 2,003 2,003
1,995Virginia Beach (VA) Pub. Imp.
G.O., Ser. 1991 A, 6.30%,
due 3/1/00 2,011 2,011
-------------- ------------
24,567 24,567
-------------- ------------
TAX-EXEMPT CASH EQUIVALENT
SECURITIES (13.8%)
300Berkeley Co. (SC) Fac. Ind.
Rev. (Amoco Chemical Co.
Proj.), Ser. 1997, 3.60%, VRDN
<PAGE>
due 4/1/27 VMIG 1 A-1+ 300 300
9,700Blytheville (AR) IDR (Nucor
Corp. Proj.), Ser. 1998,
3.55%, VRDN due 6/1/28 P-1 A-1+ 9,700 9,700
1,500Carlton (WI) PCR (Wisconsin
Pwr. & Lt. Co. Proj.),
Ser. 1988, 3.55%, VRDN
due 8/1/15 VMIG 1 1,500 1,500
5,300Commonwealth of Massachusetts
Ref. G.O., Ser. 1998 A, 3.40%,
VRDN due 9/1/16 VMIG 1 A-1+ 5,300 5,300
1,500Decatur (AL) IDB Solid Waste
Disp. Rev. (Amoco Chemical Co.
Proj.), Ser. 1995, 3.60%, VRDN
due 5/1/25 VMIG 1 1,500 1,500
1,000Delaware Co. (PA) IDA Res.
Rec. Fac. Ref. Rev. (Gen.
Elec. Cap. Corp.), Ser. 1997
G, 3.40%, VRDN due 12/1/31 A-1+ 1,000 1,000
1,900Gulf Coast (TX) Waste Disp.
Au. Env. Fac. Rev. (Bayer
Corp. Proj.), Ser. 1997,
3.60%, VRDN due 5/1/27 P-1 A-1+ 1,900 1,900
1,900Harris Co. (TX) IDC Solid
Waste Disp. Rev. (Exxon
Proj.), Ser. 1997, 3.60%, VRDN
due 4/1/32 VMIG 1 A-1+ 1,900 1,900
200Hurley (NM) PCR (Kennecott
Sante Fe Corp. Proj.), 3.50%,
VRDN due 12/1/15 P-1 A-1+ 200 200
850Lincoln Co. (WY) PCR (Exxon
Proj.), Ser. 1987 A, 3.60%,
VRDN due 7/1/17 P-1 A-1+ 850 850
1,000Madison Co. (IL) Env. Imp.
Rev. (Shell Wood River
Refining Co. Proj.),
Ser. 1997 A, 3.60%, VRDN
due 3/1/33 VMIG 1 A-1+ 1,000 1,000
2,000Nueces Co. (TX) Port of Corpus
Christi Au. Solid Waste Disp.
Ref. Rev. (Koch Refining Co.,
L.P. Proj.), Ser. 1996, 3.55%,
VRDN due 5/1/26 VMIG 1 A-1+ 2,000 2,000
600Parish of St. Charles (LA) PCR
<PAGE>
(Shell Oil Co. Norco Proj.),
Ser. 1991, 3.60%, VRDN
due 11/1/21 VMIG 1 A-1+ 600 600
1,900Parish of St. Charles (LA) PCR
(Shell Oil Co. Norco Proj.),
Ser. 1993, 3.60%, VRDN
due 9/1/23 VMIG 1 A-1+ 1,900 1,900
100Parish of St. Charles (LA)
Ref. PCR (Shell Oil Co.
Proj.), Ser. 1992 B, 3.45%,
VRDN due 10/1/22 VMIG 1 A-1+ 100 100
8,000Rhode Island & Providence
Plantations G.O., 3.45%, VRDN
due 6/1/18 VMIG 1 A-1+ 8,000 8,000
800San Antonio (TX) Higher Ed.
Au. Inc. Ref. Rev. (Trinity
Univ. Proj.), Ser. 1993,
3.50%, VRDN due 4/1/04 A-1+ 800 800
1,600Southwestern (IL) Dev. Au.
Solid Waste Disp. Rev. (Shell
Oil Co. Wood River Proj.),
Ser. 1991, 3.60%, VRDN
due 8/1/21 VMIG 1 A-1+ 1,600 1,600
100Southwestern (IL) Dev. Au.
Solid Waste Disp. Rev. (Shell
Oil Co. Wood River Proj.),
Ser. 1992, 3.60%, VRDN
due 4/1/22 VMIG 1 A-1+ 100 100
300Sublette Co. (WY) PCR (Exxon
Proj.), Ser. 1984, 3.50%,
VRDN due 11/1/14 P-1 A-1+ 300 300
150Uinta Co. (WY) PCR (Chevron
U.S.A. Inc. Proj.),
Ser. 1997, 3.50%, VRDN
due 4/1/10 P-1 150 150
-------------- ------------
40,700 40,700
-------------- - ------------
TAX-EXEMPT CASH EQUIVALENT
SECURITIES -- BACKED BY
LETTERS OF CREDIT (50.2%)
ABN AMRO BANK NV
200Long Island (NY) Pwr. Au.
Elec. Sys. Subordinated Rev.,
<PAGE>
Ser. 1998-6, 3.65%, VRDN
due 5/1/33 VMIG 1 A-1+ 200 200
5,000Phenix City (AL) IDB Env. Imp.
Rev. (Mead Coated Board
Proj.), Ser. 1988, 3.50% &
3.65%, TECP due 11/15/99 & 2/10/00 P-1 5,000 5,000
5,000Southern Minnesota (MN) Muni.
Pwr., Ser. 1995 B, 3.65%, TECP
due 2/7/00 P-1 A-1+ 5,000 5,000
BANK OF AMERICA
1,200Calhoun Co. (TX) Navigation
IDA Port Rev. (Formosa
Plastics Corp., Texas Proj.),
Ser. 1994, 3.60%, VRDN
due 11/1/15 VMIG 1 1,200 1,200
2,400Florida Hsg. Fin. Corp. Rev.
(The Club at Vero Arpt.
Proj.), Ser. 1998 E, 3.40%,
VRDN due 6/1/17 A-1+ 2,400 2,400
4,500Utah Intermountain Pwr. Agcy.
Pwr. Supply Rev., 3.40% &
3.50%, TECP due 11/9/99 & 11/17/99 A-1 4,500 4,500
BANK OF MONTREAL
100Port of Portland (OR) Spec.
Oblig. Rev. (Horizon Air Ind.,
Inc. Proj.), Ser. 1997, 3.70%,
VRDN due 6/15/27 A-1+ 100 100
BANK OF NOVA SCOTIA
2,204Harris Co. (TX) Lien Rev.,
Ser. 1998 D, 3.40%, TECP
due 11/3/99 P-1 A-1+ 2,204 2,204
BANK OF SCOTLAND
5,755Loudoun Co. (VA) IDA
Residential Care Fac. Ref.
Rev. (Falcons Landon Proj.),
Ser. 1998, 3.50%, VRDN
due 11/1/28 VMIG 1 5,755 5,755
BANK ONE
100Indiana Emp. Dev. Comm. Econ.
Dev. Rev. (K & F Ind., Inc.
Proj.), Ser. 1988, 3.65%, VRDN
due 1/1/14 VMIG 1 100 100
BANQUE NATIONALE DE PARIS
2,500St. Clair Co. (AL) IDB Ind.
<PAGE>
Rev. (Nat'l. Cement Co. Inc.,
Proj.), Ser. 1985, 3.50%, VRDN
due 3/1/05 A-1 2,500 2,500
BARCLAYS BANK INT'L., LTD.
800Michigan St. Strategic Fund
Ltd. Oblig. Rev., 3.50%, VRDN
due 9/1/30 P-1 A-1+ 800 800
2,500Michigan St. Strategic Fund
Solid Waste Disp. Rev.
(Grayling Generating Proj.),
Ser. 1990, 3.50%, VRDN
due 1/1/14 VMIG 1 2,500 2,500
1,000Peninsula Ports (VA) Coal
Term. Ref. Rev. (Dominion
Term. Assoc. Proj.), 3.45%,
TECP due 1/18/00 P-1 1,000 1,000
BAYERISCHE LANDESBANK GIROZENTRALE
7,200Denver (CO) City & Co. Arpt.
Sys. Sub. Rev., 3.40%-3.55%,
TECP due 11/10/99-2/9/00 VMIG 1 A-1+ 7,200 7,200
1,000Emmaus (PA) Gen. Au. Local
Gov't. Rev., Ser. 1989 F-13,
3.55%, VRDN due 3/1/24 A-1+ 1,000 1,000
CANADIAN IMPERIAL BANK OF COMMERCE
3,500Lake Charles (LA) Harbor &
Term. Dist. Rev. (Reynolds
Metals Co. Proj.), Ser. 1990,
3.50%, VRDN due 5/1/06 A-1+ 3,500 3,500
3,900Louisa Co. (IA) Customized
Purchase Ref. PCR
(Iowa-Illinois Gas & Elec. Co.
Proj.), Ser. 1987, 3.60%,
VRDN due 3/1/17 A-1 3,900 3,900
CHASE MANHATTAN BANK, N.A.
2,000Brazoria Co. (TX) Hlth. Fac.
Dev. Corp. Hosp. Rev.
(Brazosport Mem. Hosp.),
Ser. 1999, 3.55%, VRDN
due 7/1/13 VMIG 1 2,000 2,000
1,935Douglas Co. (GA) Dev. Au. IDR
(Whirlwind Steel Bldg., Inc.
Proj.), Ser. 1997, 3.65%, VRDN
due 12/1/12 VMIG 1 A-1 1,935 1,935
910Virginia Small Bus. Fin. Au.
<PAGE>
IDR (Coral Graphic Svc., Inc.
Proj.), Ser. 1998, 3.65%, VRDN
due 1/1/13 VMIG 1 A-1 910 910
CITIBANK, N.A
1,100Austin Co. (TX) Ind. Dev.
Corp. IDR (Justin Ind., Inc.
Proj.), Ser. 1984, 3.50%, VRDN
due 12/1/14 P-1 1,100 1,100
CREDIT COMMERCIAL DE FRANCE
200Elkhart Co. (IN) Econ. Dev.
Rev. (Pace Amer. Inc. Proj.),
3.65%, VRDN due 1/1/13 VMIG 1 200 200
2,700South Carolina Jobs Econ. Dev.
Au. Rev. (Florence RHF Hsg.,
Inc. Proj.), Ser. 1987 A,
3.60%, VRDN due 11/7/07 P-1 2,700 2,700
430South Carolina Jobs Econ. Dev.
Au. Rev. (Osmose Wood
Preserving), Ser. 1989 B,
3.70%, VRDN due 12/1/04 P-1 430 430
100South Carolina Jobs Econ. Dev.
Au. Rev. (Su-Dan Co. & Delta
Prop.), Ser. 1989 A, 3.80%,
VRDN due 1/1/04 VMIG 1 100 100
CREDIT LOCAL DE FRANCE
2,320Elmhurst (IL) Rev. (Joint
Comm. Accreditation),
Ser. 1988, 3.50%, VRDN
due 7/1/18 VMIG 1 A-1+ 2,320 2,320
CREDIT SUISSE
1,300Chattanooga (TN) Ind. Dev.
Board IDR (Market Street Ltd.
Proj.), 3.50%, VRDN
due 12/15/12 A-1+ 1,300 1,300
3,000Emery Co. (UT) Ref. PCR
(PacifiCorp Proj.),
Ser. 1991, 3.45%, VRDN
due 7/1/15 VMIG 1 A-1+ 3,000 3,000
200Montgomery Co. (TX) Ind. Dev.
Corp. IDR (Dal-Tile Corp.
Proj.), Ser. 1986 B, 3.70%,
VRDN due 12/1/03 A-1+ 200 200
1,000Texas Capital Hlth. Fac. Dev.
Corp. (Island on Lake Travis
<PAGE>
Ltd. Proj.), Ser. 1986, 3.55%,
VRDN due 12/1/16 A-1+ 1,000 1,000
DEUTSCHE BANK AG
400Florence Co. (SC) Solid Waste
Disp. & Wastewater Treatment
Fac. Rev. (Roche Carolina Inc.
Proj.), Ser. 1998, 3.60%, VRDN
due 4/1/28 A-1+ 400 400
900Hapeville (GA) Dev. Au. IDR
(Hapeville Hotel Ltd.
Partnership Proj.),
Ser. 1985, 3.55%, VRDN
due 11/1/15 P-1 900 900
400Louisiana Pub. Fac. Au. IDR
(Kenner Hotel L.P. Proj.),
Ser. 1985, 3.55%, VRDN
due 12/1/15 P-1 400 400
FIRST OF AMERICA BANK
845Michigan St. Hosp. Fin. Au.
Rev. Hosp. Equip. Loan Prog.
Rev., Ser. A, 3.52%, VRDN
due 12/1/23 VMIG 1 845 845
FIRST NATIONAL BANK OF CHICAGO
1,400Indiana Hlth. Fac. Fin. Au.
Hosp. Rev. (Deaconess Hosp.,
Inc.), Ser. 1992, 3.50%, VRDN
due 1/1/22 VMIG 1 1,400 1,400
2,600Maryland St. Hlth. & Higher
Ed. Fac. Au. Rev. (Pooled Loan
Prog.), Ser. 1985 B, 3.45%,
VRDN due 4/1/35 VMIG 1 2,600 2,600
100Massachusetts Hlth. & Ed. Fac.
Au. Rev. (Cap. Asset Prog.),
Ser. 1985 E, 3.50%, VRDN
due 1/1/35 VMIG 1 100 100
4,000Stevenson (AL) IDB Env. Imp.
Rev. (Mead Corp. Proj.),
Ser. 1998 B, 3.60%, VRDN
due 4/1/33 A-1+ 4,000 4,000
FIRST UNION NATIONAL BANK
300Jackson-Union Cos. (IL) Reg.
Port Dist. Port Fac. Ref. Rev.
(Enron Trans. Svc., L.P.
Proj.), Ser. 1994, 3.52%,
<PAGE>
VRDN due 4/1/24 A-1 300 300
1,000Monroe Co. (NY) IDA Rev.
(Collegiate Hsg. Foundation,
Inc. Fac. at Rochester
Institute of Technology),
Ser. 1998 A, 3.45%, VRDN
due 10/1/28 VMIG 1 1,000 1,000
1,200Wake Co. (NC) Ind. Fac. &
Poll. Ctrl. Fin. Au. PCR
(Carolina Pwr. & Lt. Co.
Proj.), Ser. 1987, 3.65%,
VRDN due 3/1/17 VMIG 1 1,200 1,200
2,000Washington Co. (PA) Au. Lease
Rev. (Higher Ed. Pooled Equip.
Leasing Prog.), Ser. 1985 A,
3.60%, VRDN due 11/1/05 VMIG 1 2,000 2,000
GENERAL ELECTRIC CAPITAL CORP.
790New Hampshire Hsg. Fin. Au.
Multi-Family Hsg. Rev.
(Countryside L.P. Proj.),
Ser. 1994, 3.65%, VRDN
due 7/1/24 VMIG 1 790 790
HARRIS TRUST AND SAVINGS BANK
600Illinois Dev. Fin. Au. IDR
(Grayhill, Inc. Proj.),
Ser. 1995 C, 3.60%, VRDN
due 2/1/05 A-1+ 600 600
400Illinois Dev. Fin. Au. IDR
(Overton Gear & Tool Corp.
Proj.), Ser. 1994, 3.60%, VRDN
due 10/1/08 A-1+ 400 400
LANDESBANK HESSEN-THUERINGEN GIROZENTRALE
900Southwest (TX) Higher Ed. Au.
Inc. Ref. Rev. (Southern
Methodist Univ. Proj.),
Ser. 1985, 3.55%, VRDN
due 7/1/15 VMIG 1 900 900
MORGAN GUARANTY TRUST CO.
100Grapevine (TX) IDC Rev.
(American Airlines, Inc.
Proj.), Ser. 1984 B3, 3.65%,
VRDN due 12/1/24 P-1 100 100
340Harris Co. (TX) Hlth. Fac.
Dev. Corp. Rev. (St. Lukes
<PAGE>
Episcopal Hosp.), Ser. 1997 B,
3.65%, VRDN due 6/15/27 A-1+ 340 340
1,500Jacksonville (FL) Elec. Au.
Rev., 3.50%, TECP due 11/4/99 P-1 A-1+ 1,500 1,500
2,800Maricopa Co. (AZ) Poll. Ctrl.
Corp. PCR (Arizona Pub. Svc.
Co. Palo Verde Proj.),
Ser. 1994 B, 3.50%, VRDN
due 5/1/29 P-1 A-1+ 2,800 2,800
200New York St. Energy Research &
Dev. Au. PCR (NYS Elec. &
Gas), Ser. 1994 C, 3.60%, VRDN
due 6/1/29 VMIG 1 A-1+ 200 200
300New York St. Job Dev. Au.
Spec. Purp. Rev., Ser. 1988,
3.60%, VRDN due 3/1/03 VMIG 1 A-1+ 300 300
1,000North Carolina Catawba Elec.
Muni. Pwr. Agcy. Rev., 3.65%,
TECP due 11/30/99 P-1 A-1+ 1,000 1,000
500Princeton (IN) Ref. PCR (PSI
Energy Inc., Proj.),
Ser. 1997, 3.55%, VRDN
due 4/1/22 VMIG 1 A-1+ 500 500
3,000Utah Intermountain Pwr. Agcy.
Pwr. Supply Rev., 3.50%, TECP
due 11/3/99 A-1 3,000 3,000
NATIONAL WESTMINSTER BANK PLC
300Marion Co. (WV) Comm. Solid
Waste Disp. Fac. Rev. (Grant
Town Cogeneration Proj.),
Ser. 1990 A, 3.55%, VRDN
due 10/1/17 VMIG 1 A-1+ 300 300
300Marion Co. (WV) Comm. Solid
Waste Disp. Fac. Rev. (Grant
Town Cogeneration Proj.),
Ser. 1990 D, 3.55%, VRDN
due 10/1/17 VMIG 1 A-1+ 300 300
3,800Venango (PA) IDA Res. Rec.
Rev. (Scrubgrass Proj.),
Ser. 1990 B, 3.70%, TECP
due 3/13/00 A-1+ 3,800 3,800
NATIONSBANK N.A.
600Des Moines (IA) Arpt. Rev.,
4.05%, TECP due 3/14/00 P-1 600 600
<PAGE>
NORTHERN TRUST CO.
1,165Illinois Hlth. Fac. (Rush
Presbyterian St. Lukes) Rev.,
Ser. 1996 B, 3.55%, TECP
due 11/15/99 VMIG 1 A-1+ 1,165 1,165
NORWEST BANK
800New Ulm (MN) Hosp. Ref. Rev.
(Hlth. Central Sys. Proj.),
Ser. 1985, 3.45%, VRDN
due 8/1/14 A-1+ 800 800
PNC BANK N.A.
1,000Rockport (IN) Rev. (AK Steel
Corp. Proj.), Ser. 1997 A,
3.55%, VRDN due 12/1/27 P-1 A-1 1,000 1,000
RABOBANK NEDERLAND
1,500Henderson Co. (KY) Solid Waste
Disp. Rev. (Hudson Foods, Inc.
Proj.), Ser. 1995, 3.60%, VRDN
due 3/1/15 VMIG 1 1,500 1,500
SLM HOLDING CORP.
300Nebhelp Inc. (NE) Std. Loan
Prog. Rev., Ser. 1986 A,
3.55%, VRDN due 12/1/16 A-1+ 300 300
2,200Panhandle-Plains (TX) Higher
Ed. Au. Inc. Std. Loan Rev.,
Ser. 1991 A, 3.55%, VRDN
due 6/1/21 VMIG 1 2,200 2,200
1,600Panhandle-Plains (TX) Higher
Ed. Au. Inc. Std. Loan Rev.,
Ser. 1995 A, 3.55%, VRDN
due 6/1/25 VMIG 1 1,600 1,600
SOCIETE GENERALE
1,500Athens-Clarke Co. (GA) Ind.
Dev. Au. IDR (Rhone Merieux,
Inc. Proj.), Ser. 1988, 3.70%,
TECP due 2/17/00 VMIG 1 1,500 1,500
1,900Chicago (IL) O'Hare Int'l.
Arpt. Spec. Fac. Rev.
(Compagnie Nationale Air
France Proj.), Ser. 1990,
3.60%, VRDN due 5/1/18 A-1+ 1,900 1,900
200Los Angeles (CA) Reg. Arpt.
Imp. Corp. Term. Fac.
Completion Rev. (Los Angeles
<PAGE>
Int'l. Arpt.), Ser. 1989,
3.70%, VRDN due 12/1/25 A-1+ 200 200
STATE STREET BANK AND TRUST COMPANY
2,000Rhode Island Std. Loan Au.
Prog. Rev., Ser. 1996-3,
3.60%, VRDN due 6/1/26 A-1+ 2,000 2,000
SUNTRUST BANK
1,600Clark Co. (AR) Solid Waste
Disp. Rev. (Reynolds Metals
Co. Proj.), Ser. 1992, 3.60%,
VRDN due 8/1/22 P-1 A-1+ 1,600 1,600
4,700Mayfield (KY) IDR (Seaboard
Farms of Kentucky, Inc.
Proj.), Ser. 1989, 3.60%, VRDN
due 8/1/19 P-1 4,700 4,700
TORONTO DOMINION BANK
2,500Indiana Muni. Pwr. Agcy. Pwr.
Supply Sys. Ref. Rev.,
Ser. 1998 A, 3.50%, VRDN
due 1/1/18 VMIG 1 A-1+ 2,500 2,500
100New York St. Energy Research &
Dev. Au. PCR (Niagra Mohawk
Pwr. Co. Proj.), Ser. 1986 A,
3.60%, VRDN due 12/1/26 P-1 100 100
1,860Phenix City (AL) IDB Env. Imp.
Rev. (Mead Coated Board
Proj.), Ser. 1993 A, 3.70%,
VRDN due 6/1/28 A-1+ 1,860 1,860
3,500Stevenson (AL) IDB Env. Imp.
Rev. (Mead Corp. Proj.),
Ser. 1997, 3.60%, VRDN
due 6/1/32 A-1+ 3,500 3,500
120Wisconsin Hlth. Fac. Au. Rev.
(Franciscan Hlth. Care,
Inc.-Sys. Fin.), Ser. 1985
A-2, 3.50%, VRDN due 1/1/16 VMIG 1 A-1+ 120 120
UNION BANK OF SWITZERLAND
1,000Alaska Ind. Dev. & Export Au.
Fac. Rev. (Fairbanks Gold
Mining, Inc. Proj.),
Ser. 1997, 3.60%, VRDN
due 5/1/09 VMIG 1 A-1+ 1,000 1,000
8,489Dallas (TX) Wtr. & Swr. Rev.,
3.30%-3.50%, TECP
<PAGE>
due 12/6/99-12/15/99 P-1 A-1+ 8,489 8,489
1,050Pennsylvania Energy Dev. Au.
Rev. (B & W Ebensburg Proj.),
Ser. 1986, 3.55%, VRDN
due 12/1/11 VMIG 1 1,050 1,050
1,200West Virginia Pub. Energy Au.
Rev. (Morgantown Energy Assoc.
Proj.), Ser. 1989 A, 3.40%,
TECP due 11/10/99 P-1 A-1+ 1,200 1,200
WACHOVIA BANK & TRUST CO.
1,000Crossett (AR) PCR
(Georgia-Pacific Corp. Proj.),
Ser. 1984, 3.45%, VRDN
due 10/1/07 P-1 1,000 1,000
300Los Angeles (CA) Reg. Arpt.
Imp. Corp. Lease Rev.
(American Airlines-Los Angeles
Int'l. Arpt.), Ser. 1984 D,
3.65%, VRDN due 12/1/24 P-1 300 300
500Morgan Co. (UT) Solid Waste
Disp. Rev. (Holnam Inc.
Proj.), Ser. 1996, 3.60%, VRDN
due 8/1/31 VMIG 1 A-1+ 500 500
300North Carolina Ed. Fac. Fin.
Agcy. Updates Rev. (Bowman
Gray Sch. of Medicine Proj.),
Ser. 1996, 3.50%, VRDN
due 9/1/26 VMIG 1 300 300
WESTDEUTSCHE LANDESBANK GIROZENTRALE
1,855Clark Co. (NV) Arpt. Sys. Sub.
Lien Rev., Ser. 1995 A-1,
3.45%, VRDN due 7/1/25 VMIG 1 A-1+ 1,855 1,855
3,000Dallas (TX) Area Rapid Trans.,
Ser. 1995 A, 3.55%, TECP
due 11/8/99 P-1 A-1+ 3,000 3,000
600Indianapolis (IN) Adjustable
Tender Res. Rec. Rev. (Ogden
Martin Sys. of Indianapolis,
Inc. Proj.), Ser. 1987, 3.60%,
VRDN due 12/1/16 A-1+ 600 600
1,000Port of Corpus Christi (TX)
Util. Sys. Rev., Ser. 1998 A,
3.80%, TECP due 2/8/00 P-1 1,000 1,000
-------------- ------------
<PAGE>
147,468 147,468
-------------- ------------
TAX-EXEMPT CASH EQUIVALENT
SECURITIES -- BACKED BY
INSURANCE (7.5%)
AMERICAN MUNICIPAL BOND ASSURANCE CORP.
1,500Coastal Bend (TX) Hlth. Fac.
Dev. Corp. Rev. (Incarnate
Word Hlth. Sys.), Ser. 1998 B,
3.55%, VRDN due 8/15/28 VMIG 1 1,500 1,500
1,400Illinois Hlth. Fac. Au. Rev.
(Swedish Covenant Hosp.
Proj.), Ser. 1995, 3.55%, VRDN
due 11/15/99 VMIG 1 A-1+ 1,400 1,400
2,600Indiana Secondary Mkt. for Ed.
Loans Inc. Rev., Ser. 1988 B,
3.55%, VRDN due 12/1/13 VMIG 1 A-1+ 2,600 2,600
200Rockport (IN) Ref. PCR (AEP
Generating Co. Proj.),
Ser. 1995 B, 3.50%, VRDN
due 7/1/25 A-1+ 200 200
100Sabine (TX) River Au.
Collateralized PCR (Texas
Util. Elec. Co. Proj.),
Ser. 1996 B, 3.65%, VRDN
due 3/1/26 VMIG 1 A-1+ 100 100
400Sayre (PA) Hlth. Care Fac. Au.
Hosp. Rev. (VHA of PA, Inc.
Cap. Asset Fin. Prog.),
Ser. 1985 A, 3.50%, VRDN
due 12/1/20 A-1+ 400 400
500Trinity (TX) River Au.
Collateralized PCR (Texas
Util. Elec. Co. Proj.),
Ser. 1996 A, 3.60%, VRDN
due 3/1/26 VMIG 1 A-1+ 500 500
1,100Utah State Board of Regents
Std. Loan Rev., Ser. 1988 B,
3.45%, VRDN due 11/1/00 VMIG 1 A-1+ 1,100 1,100
FINANCIAL GUARANTY INSURANCE CO.
3,300Arizona Hlth. Fac. Au. Rev.
(Pooled Loan Prog.),
Ser. 1985, 3.55%, VRDN
due 10/1/15 VMIG 1 A-1 3,300 3,300
<PAGE>
300New York City (NY) Muni. Wtr.
Fin. Au. Wtr. & Swr. Sys.
Rev., Ser. 1994 C, 3.55%, VRDN
due 6/15/23 VMIG 1 A-1+ 300 300
MUNICIPAL BOND INVESTORS ASSURANCE CORP.
1,745Charlotte (NC) Arpt. Ref.
Rev., Ser. 1997 A, 3.55%, VRDN
due 7/1/17 VMIG 1 A-1+ 1,745 1,745
900Kentucky Higher Ed. Std. Loan
Corp. Rev., Ser. 1996 A,
3.50%, VRDN due 6/1/26 VMIG 1 A-1+ 900 900
5,500Missouri-Illinois Metro. Dist.
Bi-State Dev. Agcy. Rev. (St.
Clair Co. Metrolink
Extension), Ser. 1998 B,
3.45%, VRDN due 7/1/28 VMIG 1 A-1+ 5,500 5,500
390Polk Co. (IA) Hosp. Equip. &
Imp. Rev., Ser. 1985, 3.55%,
VRDN due 12/1/05 VMIG 1 A-1 390 390
2,000South Texas Higher Ed. Au.
Inc. Std. Loan Rev.,
Ser. 1998, 3.55%, VRDN
due 12/1/03 VMIG 1 2,000 2,000
-------------- ------------
21,935 21,935
-------------- ------------
TOTAL INVESTMENTS (97.5%) $ 286,756 $ 286,756
============== ============
</TABLE>
(a) The proposed reorganization contemplates the redemption in kind of the
Municipal Money Fund's interest in the Municipal Money Portfolio.
<PAGE>
<TABLE>
<CAPTION>
MUNICIPAL SECURITIES PORTFOLIO
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
OCTOBER 31, 1999 (UNAUDITED)
MARKET
VALUE (000'S
OMITTED)
AS REPORTED PRO FORMA
-----------
FUNDS-
MUNICIPAL MUNICIPAL
PRINCIPAL AMOUNT SECURITIES SECURITIES
(000'S OMITTED) TRUST ADJUSTMENTS(A) TRUST
----------------
<S> <C> <C> <C> <C>
Investment in Portfolio $ 34,987 $ (34,987) $ 0
Investment in unaffiliated issuers and non-controlled
affiliated issuers
RATING
MOODY'S S&P
TAX-EXEMPT
SECURITIES -- PRE-REFUNDED
BACKED BY U.S. GOVERNMENT
SECURITIES (3.0%)
$ 1,000 Clark Co. (NV) Sch. Dist. Imp.
G.O., Ser. 1995 A, 5.60%,
due 6/15/08 P/R 6/15/05 Aaa AAA $ 1,048 $ 1,048
--------- -------
TAX-EXEMPT SECURITIES --BACKED
BY INSURANCE (38.3%)
AMERICAN MUNICIPAL BOND ASSURANCE CORP.
1,000 Atlanta (GA) Arpt. Fac. Ref.
Rev., Ser. 1996, 6.50%,
due 1/1/06 Aaa AAA 1,082 1,082
500 New York City (NY) Muni.
Assist. Corp. Rev., Ser. D,
5.25%, due 7/1/02 Aaa AAA 510 510
1,000 Pittsburgh (PA) G.O.,
Ser. 1997 A, 5.00%,
due 9/1/06 Aaa AAA 1,003 1,003
<PAGE>
FINANCIAL GUARANTY INSURANCE CO.
1,000 Chicago (IL) Equip. G.O.,
Ser. 1998, 5.00%, due 1/1/07 Aaa AAA 993 993
1,000 Dade Co. (FL) Wtr. & Swr. Sys.
Rev., Ser. 1995, 6.25%,
due 10/1/06 Aaa AAA 1,083 1,083
1,000 Tampa Bay (FL) Wtr. Util. Sys.
Rev., Ser. 1998 B, 5.125%,
due 10/1/09 Aaa AAA 1,004 1,004
FINANCIAL SECURITY ASSURANCE INC.
1,000 Illinois Dev. Fin. Au. Cap.
Appreciation Cons. Sch. Dist.
#304 Rev., Zero Coupon,
Yielding 4.80%, due 1/1/09 Aaa 609 609
1,000 Maine Muni. Bond Bank Ref.
Rev., Ser. 1998 A, 5.00%,
due 11/1/05 Aaa AAA 1,010 1,010
MUNICIPAL BOND INVESTORS ASSURANCE CORP.
1,000 Commonwealth of Pennsylvania
G.O. (Ref. & Proj.), 2nd
Ser. 1994, 5.20%, due 6/15/04 Aaa AAA 1,021 1,021
1,000 Connecticut Spec. Tax Oblig.
Ref. Rev. (Trans.
Infrastructure Purp.),
Ser. 1993 A, 5.40%,
due 9/1/09 Aaa AAA 1,013 1,013
1,000 Foothill/Eastern (CA) Trans.
Corridor Agcy. Toll Road Ref.
Rev., Ser. 1999, 5.25%,
due 1/15/12 Aaa AAA 987 987
1,000 Harris Co. (TX) Hlth. Fac.
Dev. Corp. Hosp. Rev. (Mem.
Hosp. Sys. Proj.), Ser. A,
5.00%, due 6/1/06 Aaa AAA 993 993
1,000 Mississippi Dev. Bank Spec.
Oblig. Rev. (Muni. Gas Au.
Proj.), Ser. 1998, 5.00%,
due 1/1/08 Aaa AAA 988 988
1,000 Puerto Rico Elec. Pwr. Au.
Ref. Rev., Ser. W, 6.50%,
due 7/1/05 Aaa AAA 1,092 1,092
--------- -------
13,388 13,388
--------- -------
<PAGE>
TAX-EXEMPT SECURITIES -- OTHER (55.6%)
1,000 Board of Regents of the Texas
A&M Univ. Sys. Perm. Univ.
Fund Rev., Ser. 1998, 5.00%,
due 7/1/08 Aaa AAA 994 994
500 Brownwood (TX) Independent
Sch. Dist. Unlimited Tax Sch.
Bldg. & Ref. G.O. (Brown Co.,
Texas), Ser. 1994, Zero
Coupon, Yielding 5.90%,
due 2/15/02 Aaa 449 449
560 Brownwood (TX) Independent
Sch. Dist. Unlimited Tax Sch.
Bldg. & Ref. G.O. (Brown Co.,
Texas), Ser. 1994, Zero
Coupon, Yielding 6.10%,
due 2/15/04 Aaa 453 453
1,000 Columbus (OH) Var. Purp. Ltd.
Tax G.O., Ser. 1998-1, 5.00%,
due 6/15/08 Aaa AAA 998 998
1,000 Commonwealth of Massachusetts
Ref. G.O., Ser. 1995 A,
6.25%, due 7/1/04 Aa3 AA- 1,066 1,066
1,000 Florida St. Board of Ed. Cap.
Outlay Ref. G.O., Ser. B,
5.25%, due 6/1/09 Aa2 AA+ 1,010 1,010
1,000 Georgia G.O., Ser. 1995 C,
7.25%, due 7/1/04 Aaa AAA 1,108 1,108
1,000 Lake Co. (IL) Forest Preserve
Dist. Ref. G.O., Ser. 1997,
5.50%, due 2/1/09 Aa1 AA+ 1,022 1,022
1,500 Lubbock (TX) Hlth. Fac. Dev.
Corp. Rev. (St. Joseph Hlth.
Sys.), Ser. 1998, 5.00%,
due 7/1/08 Aa3 AA 1,479 1,479
1,500 Maryland Comm. Dev. Admin.
Dept. of Hsg. & Comm. Dev.
Rev. (Single Family Prog.),
3rd Ser. 1993, 5.15%,
due 4/1/08 Aa2 1,488 1,488
1,000 Maryland Wtr. Quality Fin.
Admin. Ref. Rev. (Revolving
Loan Fund), Ser. 1995 A,
5.50%, due 9/1/11 Aa2 AA 1,009 1,009
<PAGE>
1,000 Mecklenburg Co. (NC) Pub. Imp.
G.O., Ser. 1994, 5.50%,
due 4/1/12 Aaa AAA 1,005 1,005
135 Mississippi Higher Ed. Assist.
Corp. Std. Loan Sub. Rev.,
Ser. 1993 C, 6.05%,
due 9/1/07 A 136 136
1,000 Nevada Ref. Ltd. Tax G.O.,
Ser. 1997 A-2, 6.00%,
due 5/15/06 Aa2 AA 1,057 1,057
500 New Jersey Bldg. Au. St. Bldg.
Rev., Ser. 1994, 5.00%,
due 6/15/11 Aa2 AA- 484 484
750 New York City (NY) IDA Spec.
Fac. Rev. (Term. One Group
Assoc., L.P. Proj.),
Ser. 1994, 6.00%, due 1/1/15 A3 A 748 748
1,000 New York St. Env. Fac. Corp.
Rev., Ser. 1999 B, 5.00%,
due 10/15/09 Aaa AAA 985 985
1,000 North Carolina Cap. Imp. G.O.,
Ser. 1994 A, 4.70%,
due 2/1/06 Aaa AAA 995 995
1,000 Omaha (NE) Pub. Pwr. Dist.
Elec. Sys. Rev., Ser. 1993 E,
4.60%, due 2/1/06 Aa2 AA 980 980
1,000 San Antonio (TX) Elec. & Gas
Sys. Ref. Rev., Ser. 1998 A,
5.00%, due 2/1/05 Aa1 AA 1,007 1,007
1,000 Texas Pub. Fin. Au. Ref. G.O.,
Ser. 1998 B, 5.13%,
due 10/1/09 Aa1 AA 997 997
--------- -------
19,470 19,470
--------- -------
TAX-EXEMPT CASH EQUIVALENT
SECURITIES (0.6%)
100 Gulf Coast (TX) IDA Marine
Term. Rev. (Amoco Oil Co.
Proj.), Ser. 1993, 3.60%, VRDN
due 4/1/28 VMIG 1 A-1+ 100 100
100 Lower Neches Valley (TX) Auth.
Ind. Dev. Corp. Rev. (Mobil
Oil Corp. Proj.), Ser. 1999,
3.60%, VRDN due 4/1/29 P-1 A-1+ 100 100
--------- -------
200 200
--------- -------
<PAGE>
TAX-EXEMPT CASH EQUIVALENT
SECURITIES -- BACKED BY
LETTERS OF
CREDIT (1.1%)
SOCIETE GENERALE
400 Los Angeles (CA) Reg. Arpt.
Imp. Corp. Term. Fac.
Completion Rev. (Los Angeles
Int'l. Arpt.), Ser. 1989,
3.70%, VRDN due 12/1/25 A-1+ 400 400
--------- -------
TOTAL INVESTMENTS (98.6%)
(COST $35,084) $ 34,506 $34,506
========= =======
</TABLE>
(a) The proposed reorganization contemplates the redemption in kind of the
Municipal Securities Trust's interest in the Municipal Securities Portfolio.
<PAGE>
Most of the following Pro Forma
combining financial information is as of
August 31, 1999 and the fiscal period
then ended. Except for Technology Fund,
those funds that began operations after
August 31, 1999 are shown as of February
29, 2000 and the fiscal period then
ended. Because Technology started
operations after February 29, 2000 its
information is as of June 30, 2000 and
the fiscal period then ended.
GENESIS
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31 ,1999
<TABLE>
<CAPTION>
Pro Forma
AS REPORTED (UNAUDITED)
------------------------------------ -----------
EQUITY EQUITY GENESIS
EQUITY FUNDS EQUITY TRUST ASSETS SERIES SUBTOTAL ADJUSTMENTS FUND
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio $ 848,098 $ 597,219 $ 81,781 $ 224,006 $1,751,104 $(1,751,104)(a)
Investment in unaffiliated issuers and
non-controlled affiliated issuers - - - - - 1,778,932 (a) $ 1,778,932
Assets net of liabilities at Portfolio - - - - - 14,697 (a) 14,697
Deferred organization costs - - 31 - 31 (31) (b) -
Receivable for Trust shares sold 5,080 1,963 156 725 7,924 - 7,924
Receivable from administrator - - - 14 14 31 (b) 45
------------ ---------- --------- --------- ---------- ----------- -----------
Subtotal $ 853,178 $ 599,182 $ 81,968 $ 224,745 $1,759,073 $ 42,525 $ 1,801,598
------------ ---------- --------- --------- ---------- ----------- -----------
LIABILITIES
Payable for collateral on securities
loaned - - - - - 42,525 (a) 42,525
Payable for Fund expenses - - - - - - -
Payable for Trust shares redeemed 1,423 7,627 86 493 9,629 - 9,629
Payable to Administrator 194 209 25 - 428 - 428
Accrued expenses 306 237 52 28 623 - 623
------------ ---------- --------- --------- ---------- ----------- -----------
Subtotal 1,923 8,073 163 521 10,680 42,525 53,205
------------ ---------- --------- --------- ---------- ----------- -----------
NET ASSETS - AT VALUE $ 851,255 $ 591,109 $ 81,805 $ 224,224 $1,748,393 $ - $ 1,748,393
============ ========== ========= ========= ========== =========== ===========
NET ASSETS CONSIST OF
Par value $ 59 $ 29 $ 6 $ 11 $ 105 $ - $ 105
Paid-in capital 803,757 591,902 80,941 232,531 1,709,131 - 1,709,131
Accumulated undistributed net
investment income (loss) 3,735 2,832 19 190 6,776 - 6,776
Accumulated realized gain/loss (58,958) (48,174) (1,608) 199 (108,541) - (108,541)
Unrealized gain/loss 102,662 44,520 2,447 (8,707) 140,922 - 140,922
------------ ---------- --------- --------- ---------- ----------- -----------
NET ASSETS - AT VALUE $ 851,255 $ 591,109 $ 81,805 $ 224,224 $1,748,393 $ - $ 1,748,393
============ ========== ========= ========= ========== =========== ===========
Shares 59,152 29,177 6,473 11,058
NAV $ 14.39 $ 20.26 $ 12.64 $ 20.28
Shares - Fund Class 59,152
NAV - Fund Class $ 14.39
$ 851,255
===========
Shares - Trust Class 29,177
NAV - Trust Class $ 20.26
$ 591,109
===========
Shares - Asset Class 6,473
NAV - Asset Class $ 12.64
$ 81,805
===========
Shares - Series Class 11,058
NAV - Series Class $ 20.28
$ 224,224
===========
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated issuers, Assets
net of liabilities at Portfolio (if any) and Payables for collateral on securities loaned are being transferred from the Portfolio
to the Fund.
(b) If the proposed reorganization had occurred at August 31, 1999, deferred organization costs, if any, would have been borne by
the administrator; however, these costs are expected to be fully amortized before the date of the reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31 ,1999
Pro Forma
(unaudited)
-----------
EQUITY EQUITY
EQUITY FUNDS EQUITY TRUST ASSETS SERIES SUBTOTAL ADJUSTMENTS GENESIS FUND
<S> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Investment income from Portfolio $ 17,965 $ 13,052 $ 956 $ 527 $ 32,500 $ (32,500) (c) $ -
Dividend income - unaffiliated issuers - - - - - 25,981 (c) 25,981
Dividend income- non-controlled
affiliated issuers - - - - - 1,078 1,078
Interest income - - - - - 5,441 5,441
Foreign Taxes withheld - - - - - - (c) -
------------ ---------- --------- --------- ---------- ----------- -----------
Total Income 17,965 13,052 956 527 32,500 - 32,500
------------ ---------- --------- --------- ---------- ----------- -----------
EXPENSES
Administration fee 2,634 2,948 230 59 5,871 - 5,871
Investment management fee - - - - - 13,245 (d) 13,245
Accounting fees - - - - - 10 (d) 10
Amortization of deferred organization
costs - - 12 - 12 - 12
Audit 8 5 5 4 22 46 (d) 68
Custodian 10 10 10 2 32 342 (d) 374
Insurance expense - - - - - 26 (d) 26
Distribution fees - - 141 - 141 - 141
Legal 12 17 11 36 76 27 (d) 103
Registration & filing fees 188 184 41 37 450 - 450
Shareholder reports 250 356 36 19 661 - 661
Transfer agent 1,147 26 17 3 1,193 - 1,193
Trustees 14 11 1 1 27 25 (d) 52
Miscellaneous 26 8 2 - 36 45 (d) 81
Portfolio expenses 7,546 5,495 430 295 13,766 (13,766)(d) -
------------ ---------- --------- --------- ---------- ----------- -----------
Gross 11,835 9,060 936 456 22,287 - 22,287
Reductions (3) (2) (73) (119) (197) - (197)
------------ ---------- --------- --------- ---------- ----------- -----------
Net 11,832 9,058 863 337 22,090 - 22,090
NET INVESTMENT INCOME (LOSS) 6,133 3,994 93 190 10,410 - 10,410
------------ ---------- --------- --------- ---------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS FROM CORRESPONDING PORTFOLIO
Net realized gain/loss on investment
securities (58,582) (50,517) (1,746) 454 (110,391) 110,391 (e) -
Change in net unrealized appreciation/
depreciation on investments 235,324 178,420 8,646 (8,707) 413,683 (413,683)(e) -
------------ ---------- --------- --------- ---------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
Net realized gain/loss on investment
securities (110,391)(e) (110,391)
Change in net unrealized appreciation/
depreciation on investments 413,683 (e) 413,683
Net gain (loss) on investments 176,742 127,903 6,900 (8,253) 303,292 - 303,292
------------ ---------- --------- --------- ---------- ----------- -----------
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS $ 182,875 $ 131,897 $ 6,993 $ (8,063) $ 313,702 $ - $ 313,702
============ ========== ========= ========= ========== =========== ===========
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled affiliated
issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization; however, the
Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
SOCIALLY RESPONSIVE
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31 ,1999
Pro Forma
AS REPORTED (UNAUDITED)
------------------------------------ -----------
EQUITY EQUITY SOCIALLY
EQUITY FUNDS EQUITY TRUST ASSETS SERIES SUBTOTAL ADJUSTMENTS RESPONSIVE
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio $ 118,614 $ 253,115 $ 25,267 $ 117 $ 397,113 $ (397,113)(a)
Investment in unaffiliated issuers
and non-controlled affiliated issuers - - - - - 392,600 (a) $ 392,600
Assets net of liabilities at Portfolio - - - - - 6,853 (a) 6,853
Deferred organization costs - - 57 - 57 (57)(b) -
Receivable for Trust shares sold 489 - 59 - 548 - 548
Receivable from administrator - 6 9 14 29 57 (b) 86
------------ ---------- --------- --------- ---------- --------- -----------
Subtotal
$ 119,103 $ 253,121 $ 25,392 $ 131 $ 397,747 $ 2,340 400,087
LIABILITIES
Payable for collateral on securities
loaned - - - - - 2,340 (a) 2,340
Payable for Fund expenses - - - - - - -
Payable for Trust shares redeemed 101 105 60 - 266 - 266
Payable to Administrator 27 - - - 27 - 27
Accrued expenses 75 41 37 22 175 - 175
------------ ---------- --------- --------- ---------- --------- -----------
Subtotal 203 146 97 22 468 2,340 2,808
------------ ---------- --------- --------- ---------- --------- -----------
Net Assets - at value $ 118,900 $ 252,975 $ 25,295 $ 109 $ 397,279 - $ 397,279
=========== ========== ========= ========= ========== ========= ==========
Net Assets consist of
Par value $ 6 $ 13 $ 2 - $ 21 - $ 21
Paid-in capital 88,754 165,031 21,517 111 275,413 - 275,413
Accumulated undistributed net
investment income (loss) 116 1,401 - - 1,517 - 1,517
Accumulated realized gain/loss 4,840 17,071 460 (1) 22,370 - 22,370
Unrealized gain/loss 25,184 69,459 3,316 (1) 97,958 - 97,958
----------- ---------- --------- --------- ---------- --------- ----------
Net Assets - at value $ 118,900 $ 252,975 $ 25,295 $ 109 $ 397,279 - $ 397,279
=========== ========== ========= ========= ========== ========= ==========
Shares 5,575 12,783 1,755 11
NAV $ 21.33 19.79 14.41 9.85
Shares - Fund Class 5,575
NAV - Fund Class $ 21.33
$ 118,900
==========
Shares - Trust Class 12,783
NAV - Trust Class $ 19.79
$ 252,975
==========
Shares - Asset Class 1,755
NAV - Asset Class $ 14.41
$ 25,295
==========
Shares - Series Class 11
NAV - Series Class $ 9.85
$ 109
==========
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated issuers, Assets
net of liabilities at Portfolio (if any) and Payables for collateral on securities loaned are being transferred from the Portfolio
to the Fund.
(b) If the proposed reorganization had occurred at August 31, 1999, deferred organization costs, if any, would have been borne by
the administrator; however, these costs are expected to be fully amortized before the date of the reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31 ,1999
Pro Forma
AS REPORTED (UNAUDITED)
-----------
SOCIALLY
EQUITY EQUITY RESPONSIVE
EQUITY FUNDS EQUITY TRUST ASSETS SERIES SUBTOTAL ADJUSTMENTS FUND
<S> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Investment income from Portfolio $ 1,314 $ 2,864 $ 236 - $ 4,414 $ (4,414)(c) -
Dividend income - unaffiliated
issuers - - - - - 3,639 (c) $ 3,639
Dividend income- non-controlled
affiliated issuers - - - - - - -
Interest income - - - - - 775 775
Foreign Taxes withheld - - - - - - (c) -
----------- ---------- --------- --------- ---------- --------- ----------
Total Income $ 1,314 $ 2,864 $ 236 - $ 4,414 $ - $ 4,414
EXPENSES
Administration fee 280 117 78 - 475 - 475
Investment management fee - - - - - 1,956 (d) 1,956
Accounting fees - - - - - 10 (d) 10
Amortization of deferred
organization costs 8 5 23 - 36 4 40
Audit 8 8 9 4 29 34 (d) 63
Custodian 10 10 10 2 32 109 (d) 141
Insurance expense - - - - - 4 (d) 4
Distribution fees - - - - - - -
Legal 11 20 28 55 114 18 (d) 132
Registration & filing fees 32 4 35 46 117 - 117
Shareholder reports 47 44 17 20 128 - 128
Transfer agent 138 17 18 - 173 - 173
Trustees 3 6 - - 9 9 (d) 18
Miscellaneous 3 4 1 - 8 - (d) 8
Portfolio expenses 640 1,388 116 - 2,144 (2,144)(d) -
----------- ---------- --------- --------- ---------- --------- ----------
Gross 1,180 1,623 335 127 3,265 - 3,265
Reductions - (221) (101) (127) (449) - (449)
----------- ---------- --------- --------- ---------- --------- ----------
Net 1,180 1,402 234 - 2,816 - 2,816
NET INVESTMENT INCOME (LOSS) 134 1,462 2 - 1,598 - 1,598
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS FROM CORRESPONDING PORTFOLIO
Net realized gain/loss on investment
securities 4,788 17,268 429 (1) 22,484 (22,484)(e) -
Change in net unrealized appreciation/
depreciation on investments 25,901 50,845 4,701 (1) 81,446 (81,446)(e) -
----------- ---------- --------- --------- ---------- --------- ----------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain/loss on
investment securities 22,484 (e) 22,484
Change in net unrealized appreciation/
depreciation on investments 81,446 (e) 81,446
Net gain (loss) on investments 30,689 68,113 5,130 (2) 103,930 - 103,930
----------- ---------- --------- --------- ---------- --------- ----------
Net increase (decrease) in net assets
resulting from operations $ 30,823 $ 69,575 $ 5,132 $ (2) $ 105,528 $ - $ 105,528
=========== ========== ========= ========= ========== ========= ==========
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled affiliated
issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization; however, the
Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
INTERNATIONAL
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31 ,1999
PRO FORMA
AS REPORTED (UNAUDITED)
------------------------------------ -----------
INTERNATIONAL
EQUITY FUNDS EQUITY TRUST SUBTOTAL ADJUSTMENTS FUND
<S> <C> <C> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio $ 112,213 $ 2,303 $ 114,516 $ (114,516)(a)
Investment in unaffiliated issuers
and non-controlled affiliated issuers - - - 119,248 (a) $ 119,248
Assets net of liabilities at Portfolio - - - 142 (a) 142
Deferred organization costs - 70 70 (70)(b) -
Receivable for Trust shares sold 586 23 609 - 609
Receivable from administrator - - - 70 (b) 70
----------- ---------- ---------- --------- ------------
Subtotal 112,799 2,396 115,195 4,874 120,069
LIABILITIES
Payable for collateral on securities
loaned - - - 4,874 (a) 4,874
Payable for Fund expenses - - - - -
Payable for Trust shares redeemed 176 - 176 - 176
Payable to Administrator 25 7 32 - 32
Accrued expenses 82 16 98 - 98
----------- ---------- ---------- --------- ------------
Subtotal 283 23 306 4,874 5,180
----------- ---------- ---------- --------- ------------
NET ASSETS - AT VALUE $ 112,516 $ 2,373 $ 114,889 $ - $ 114,889
=========== ========== ========== ========= ============
NET ASSETS CONSIST OF
Par value $ 7 $ - $ 7 $ - $ 7
Paid-in capital 76,407 2,382 78,789 - 78,789
Accumulated undistributed net
investment income (loss) (328) (6) (334) - (334)
Accumulated realized gain/loss 1,519 28 1,547 - 1,547
Unrealized gain/loss 34,911 (31) 34,880 - 34,880
----------- ---------- ---------- --------- ------------
NET ASSETS - AT VALUE $ 112,516 $ 2,373 $ 114,889 - 114,889
=========== ========== ========== ========= ============
Shares 6,712 140
NAV $ 16.76 16.92
6,712
Shares - Fund Class $ 16.76
NAV - Fund Class $ 112,516
============
140
Shares - Trust Class $ 16.92
NAV - Trust Class $ 2,373
============
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated issuers, Assets
net of liabilities at Portfolio (if any) and Payables for collateral on securities loaned are being transferred from the Portfolio
to the Fund.
(b) If the proposed reorganization had occurred at August 31, 1999, deferred organization costs, if any, would have been borne by
the administrator; however, these costs are expected to be fully amortized before the date of the reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31 ,1999
PRO FORMA
(UNAUDITED)
-------------
INTERNATIONAL
EQUITY FUNDS EQUITY TRUST SUBTOTAL ADJUSTMENTS FUND
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Investment income from Portfolio $ 1,393 $ 25 $ 1,418 $ (1,418)(c) -
Dividend income - unaffiliated issuers - - - 1,079 (c) $ 1,079
Dividend income- non-controlled
affiliated issuers - - - - -
Interest income - - - 509 509
Foreign Taxes withheld - - - (170)(c) (170)
----------- ------- ---------- -------- -----------
Total Income 1,393 25 1,418 - 1,418
----------- ------- ---------- -------- -----------
EXPENSES
Administration fee 307 8 315 - 315
Investment management fee - - - 1,019 (d) 1,019
Accounting fees - - - 10 (d) 10
Amortization of deferred
organization costs 16 18 34 9 43
Audit 9 4 13 33 (d) 46
Custodian 10 10 20 208 (d) 228
Insurance expense - - - 2 (d) 2
Rembursement of expenses previously
assumed by administrator 20 - 20 - 20
Legal 16 16 32 30 (d) 62
Registration & filing fees 27 26 53 - 53
Shareholder reports 46 17 63 - 63
Transfer agent 138 2 140 - 140
Trustees 6 - 6 11 (d) 17
Miscellaneous 3 1 4 3 (d) 7
Portfolio expenses 1,302 23 1,325 (1,325)(d) -
---------- ------ --------- -------- -----------
Gross 1,900 125 2,025 - 2,025
Reductions (3) (90) (93) - (93)
---------- ------ --------- -------- -----------
Net 1,897 35 1,932 - 1,932
---------- ------ --------- -------- -----------
NET INVESTMENT INCOME (LOSS) (504) (10) (514) - (514)
---------- ------ --------- -------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS FROM CORRESPONDING PORTFOLIO
Net realized gain/loss on
investment securities 11,645 135 11,780 (11,780)(e) -
Change in net unrealized appreciation/
depreciation on investments 12,310 314 12,624 (12,624)(e) -
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain/loss on investment
securities 11,780 (e) 11,780
Change in net unrealized appreciation
/depreciation on investments 12,624 (e) 12,624
Net gain (loss) on investments 23,955 449 24,404 - 24,404
---------- ------ --------- -------- -----------
NET INCREASE (DECREASE) IN NET $ 23,451 $ 439 $ 23,890 - $ 23,890
ASSETS RESULTING FROM OPERATIONS
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled affiliated
issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization; however, the
Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
REGENCY
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31 ,1999
PRO FORMA
AS REPORTED (UNAUDITED)
------------------------------------ -----------
EQUITY FUNDS EQUITY TRUST SUBTOTAL ADJUSTMENTS REGENCY FUND
<S> <C> <C> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio $ 7,923 $ 353 $ 8,276 $ (8,276)(a)
Investment in unaffiliated issuers
and non-controlled affiliated issuers - - - 8,093 (a) $ 8,093
Assets net of liabilities at Portfolio - - - 233 (a) 233
Deferred organization costs - - - - (b) -
Receivable for Trust shares sold 6 - 6 - 6
Receivable from administrator 29 72 101 - (b) 101
----------- ---------- --------- -------- ----------
Subtotal 7,958 425 8,383 50 8,433
----------- ---------- --------- -------- ----------
LIABILITIES
Payable for collateral on
securities loaned - - - 50 (a) 50
Payable for Fund expenses - 55 55 - 55
Payable for Trust shares redeemed 1 - 1 - 1
Payable to Administrator - - - - -
Accrued expenses 14 13 27 - 27
----------- ---------- --------- ------- ----------
Subtotal 15 68 83 50 133
----------- ---------- --------- ------- ----------
NET ASSETS - AT VALUE $ 7,943 $ 357 $ 8,300 $ - $ 8,300
NET ASSETS CONSIST OF
Par value $ 1 $ - $ 1 $ - $ 1
Paid-in capital 8,361 371 8,732 - 8,732
Accumulated undistributed net
investment income (loss) 10 - 10 - 10
Accumulated realized gain/loss 72 3 75 - 75
Unrealized gain/loss (501) (17) (518) - (518)
----------- ---------- --------- ------- ----------
NET ASSETS - AT VALUE $ 7,943 $ 357 $ 8,300 $ $ 8,300
----------- ---------- --------- ------- ----------
Shares 809 37
NAV $ 9.82 $ 9.76
809
Shares - Fund Class 9.82
NAV - Fund Class $ 7,943
==========
37
Shares - Trust Class $ 9.76
NAV - Trust Class $ 357
==========
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated issuers, Assets
net of liabilities at Portfolio (if any) and Payables for collateral on securities loaned are being transferred from the Portfolio
to the Fund.
(b) If the proposed reorganization had occurred at August 31, 1999, deferred organization costs, if any, would have been borne by
the administrator; however, these costs are expected to be fully amortized before the date of the reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31 ,1999
PRO FORMA
(UNAUDITED)
AS REPORTED ----------
EQUITY FUNDS EQUITY TRUST SUBTOTAL ADJUSTMENTS REGENCY FUND
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Investment income from Portfolio $ 32 $ 1 $ 33 $ (33)(c) $ -
Dividend income - unaffiliated
issuers - - - 16 (c) 16
Dividend income- non-controlled
affiliated issuers - - - - -
Interest income - - - 17 17
Foreign Taxes withheld - - - - (c) -
----------- ---------- ---------- --------- -----------
Total Income 32 1 33 - 33
EXPENSES
Administration fee 4 - 4 - 4
Investment management fee - - - 8 (d) 8
Accounting fees - - - 3 (d) 3
Amortization of deferred
organization costs - - - - -
Audit 5 5 10 15 (d) 25
Custodian 2 3 5 9 (d) 14
Insurance expense - - - - (d) -
Distribution fees - - - - -
Legal 27 25 52 5 (d) 57
Registration & filing fees 38 36 74 - 74
Shareholder reports 7 3 10 - 10
Transfer agent 1 - 1 - 1
Trustees - - - - (d) -
Miscellaneous - - - - (d) -
Portfolio expenses 39 1 40 (40)(d) -
----------- ---------- ---------- --------- -----------
Gross 123 73 196 - 196
----------- ---------- ---------- --------- -----------
Reductions (101) (72) (173) - (173)
Net 22 1 23 - 23
NET INVESTMENT INCOME (LOSS) 10 - 10 - 10
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS FROM CORRESPONDING PORTFOLIO
Net realized gain/loss on
investment securities 72 3 75 (75)(e) -
Change in net unrealized appreciation/
depreciation on investments (501) (17) (518) 518 (e) -
----------- ---------- ---------- --------- -----------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain/loss on investment
securities 75 (e) 75
Change in net unrealized appreciation/
depreciation on investments (518)(e) (518)
Net gain (loss) on investments (429) (14) (443) - (443)
----------- ---------- ---------- --------- -----------
Net increase (decrease) in net
assets resulting from operations $ (419) $ (14) $ (433) $ - $ (433)
----------- ---------- ---------- --------- -----------
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled affiliated
issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization; however, the
Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
MILLENNIUM
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31 ,1999
PRO FORMA
AS REPORTED (UNAUDITED)
------------------------------------ -----------
EQUITY MILLENNIUM
EQUITY FUNDS EQUITY TRUST ASSETS SUBTOTAL ADJUSTMENTS FUND
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio $ 326,493 $ 16,116 $ 66 $ 342,675 $ (342,675)(a)
Investment in unaffiliated issuers
and non-controlled affiliated issuers - - - - 391,168 (a) $ 391,168
Assets net of liabilities at Portfolio - - - - - (a) -
Deferred organization costs - - - - - (b) -
Receivable for Trust shares sold 2,809 439 - 3,248 - 3,248
Receivable from administrator - - 45 45 - (b) 45
---------- ---------- ------- ---------- ---------- ----------
Subtotal 329,302 16,555 111 345,968 48,493 394,461
---------- ---------- ------- ---------- ---------- ----------
LIABILITIES
Payable for collateral on
securities loaned - - - - 43,223 (a) 43,223
Liabilities net of assets at Portfolio - - - - 5,270 5,270
Payable for Fund expenses - - 38 38 - 38
Payable for Trust shares redeemed 266 6 - 272 - 272
Payable to Administrator 57 8 - 65 - 65
Accrued expenses 77 26 7 110 - 110
---------- ---------- ------- ---------- ---------- ----------
Subtotal 400 40 45 485 48,493 48,978
---------- ---------- ------- ---------- ---------- ----------
NET ASSETS - AT VALUE $ 328,902 $ 16,515 $ 66 $ 345,483 $ - $ 345,483
---------- ---------- ------- ---------- ---------- ----------
NET ASSETS CONSIST OF
Par value $ 8 $ - $ - $ 8 $ - $ 8
Paid-in capital 186,380 10,270 55 196,705 - 196,705
Accumulated undistributed net
investment income (loss) (779) (40) - (819) - (819)
Accumulated realized gain/loss 22,249 850 - 23,099 - 23,099
Unrealized gain/loss 121,044 5,435 11 126,490 - 126,490
---------- ---------- ------- ---------- ---------- ----------
NET ASSETS - AT VALUE $ 328,902 $ 16,515 $ 66 $ 345,483 $ - $ 345,483
---------- ---------- ------- ---------- ---------- ----------
Shares 7,932 420 5
NAV $ 41.46 $ 39.28 $ 12.49
Shares - Fund Class 7,932
NAV - Fund Class $ 41.46
$ 328,902
==========
Shares - Trust Class 420
NAV - Trust Class $ 39.28
$ 16,515
==========
Shares - Asset Class 5
NAV - Asset Class $ 12.49
$ 66
==========
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated issuers,
liabilities net of assets at Portfolio (if any) and Payables for collateral on securities loaned are being transferred from the
Portfolio to the Fund.
(b) If the proposed reorganization had occurred at February 29, 2000, deferred organization costs, if any, would have been borne by
the administrator; however, these costs are expected to be fully amortized before the date of the reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31 ,1999
PRO FORMA
AS REPORTED (UNAUDITED)
------------------------------------ -----------
EQUITY MILLENNIUM
EQUITY FUNDS EQUITY TRUST ASSETS SUBTOTAL ADJUSTMENTS FUND
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Investment income from Portfolio $ 359 $ 15 $ - $ 374 (c) $ (374) $ -
Dividend income - unaffiliated
issuers - - - - 4 (c) 4
Dividend income- non-controlled
affiliated issuers - - - - - -
Interest income - - - - 370 370
Foreign Taxes withheld - - - - - (c) -
----------- ---------- --------- ---------- --------- ---------
Total Income 359 15 - 374 - 374
----------- ---------- --------- ---------- --------- ---------
EXPENSES
Administration fee 192 13 - 205 - 205
Investment management fee - - - - 655 (d) 655
Accounting fees - - - - 5 (d) 5
Amortization of deferred
organization costs - - - - - -
Audit 3 1 1 5 8 (d) 13
Custodian 5 5 1 11 47 (d) 58
Rembursement of expenses previously
assumed by administrator 102 - - 102 - (d) 102
Distribution fees - 1 - 1 - 1
Legal 5 8 5 18 11 (d) 29
Registration & filing fees 39 22 33 94 - 94
Shareholder reports 15 12 5 32 - 32
Transfer agent 65 7 - 72 - 72
Trustees 3 - - 3 3 (d) 6
Miscellaneous 8 2 - 10 4 (d) 14
Portfolio expenses 703 30 - 733 (733)(d) -
----------- ---------- --------- ---------- --------- ---------
GROSS 1,140 101 45 1,286 - 1,286
----------- ---------- --------- ---------- --------- ---------
Reductions (2) (46) (45) (93) - (93)
NET 1,138 55 - 1,193 - 1,193
----------- ---------- --------- ---------- --------- ---------
NET INVESTMENT INCOME (LOSS) (779) (40) - (819) - (819)
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS FROM CORRESPONDING PORTFOLIO
Net realized gain/loss on investment
securities 23,507 891 - 24,398 (24,398)(e) -
Change in net unrealized appreciation/
depreciation on investments 115,136 5,226 11 120,373 (120,373)(e) -
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain/loss on investment
securities 24,398 (e) 24,398
Change in net unrealized appreciation/
depreciation on investments 120,373 (e) 120,373
Net gain (loss) on investments 138,643 6,117 11 144,771 - 144,771
----------- ---------- --------- ---------- --------- ---------
NET INCREASE (DECREASE) IN NET $ 137,864 $ 6,077 $ 11 $ 143,952 $ - $ 143,952
ASSETS RESULTING FROM OPERATIONS
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled affiliated
issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization; however, the
Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
CENTURY
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31 ,1999
PRO FORMA
AS REPORTED (UNAUDITED)
------------------------------------ -----------
EQUITY FUNDS EQUITY TRUST SUBTOTAL ADJUSTMENTS CENTURY FUND
<S> <C> <C> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio $ 28,829 $ 2,137 $ 30,966 $ (30,966)(a)
Investment in unaffiliated issuers and
non-controlled affiliated issuers - - - 34,363 (a) $ 34,363
Assets net of liabilities at Portfolio - - - - (a) -
Deferred organization costs - - - - (b) -
Receivable for Trust shares sold 214 - 214 - 214
Receivable from administrator - - - - (b) -
----------- ---------- --------- --------- ------------
Subtotal 29,043 2,137 31,180 3,397 34,577
----------- ---------- --------- --------- ------------
LIABILITIES
Payable for collateral on
securities loaned - - - 2,493 (a) 2,493
Liabilities net of assets at Portfolio - - - 904 904
Payable for Fund expenses - - - - -
Payable for Trust shares redeemed 15 - 15 - 15
Payable to Administrator 2 1 3 - 3
Accrued expenses 13 12 25 - 25
----------- ---------- --------- --------- ------------
Subtotal 30 13 43 3,397 3,440
----------- ---------- --------- --------- ------------
NET ASSETS - AT VALUE $ 29,013 $ 2,124 $ 31,137 $ - $ 31,137
----------- ---------- --------- --------- ------------
31,137
NET ASSETS CONSIST OF
Par value $ 2 $ - $ 2 $ - $ 2
Paid-in capital 26,037 1,744 27,781 - 27,781
Accumulated undistributed net
investment income (loss) (17) (1) (18) - (18)
Accumulated realized gain/loss (15) 6 (9) - (9)
Unrealized gain/loss 3,006 375 3,381 - 3,381
----------- ---------- --------- --------- ------------
NET ASSETS - AT VALUE $ 29,013 $ 2,124 $ 31,137 $ - $ 31,137
Shares 2,344 172
NAV $ 12.38 $ 12.38
Shares - Fund Class 2,344
NAV - Fund Class $ 12.38
$ 29,013
=============
Shares - Trust Class 172
NAV - Trust Class $ 12.38
$ 2,124
=============
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated issuers,
liabilities net of assets at Portfolio (if any) and Payables for collateral on securities loaned are being transferred from the
Portfolio to the Fund.
(b) If the proposed reorganization had occurred at February 29, 2000, deferred organization costs, if any, would have been borne by
the administrator; however, these costs are expected to be fully amortized before the date of the reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31 ,1999
PRO FORMA
AS REPORTED (UNAUDITED)
------------------------------------ -----------
EQUITY FUNDS EQUITY TRUST SUBTOTAL ADJUSTMENTS CENTURY FUND
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Investment income from Portfolio $ 40 $ 5 $ 45 $ (45)(c) $ -
Dividend income - unaffiliated
issuers - - - 9 (c) 9
Dividend income- non-controlled
affiliated issuers - - - - -
Interest income - - - 36 36
Foreign Taxes withheld - - - - (c) -
----------- ---------- --------- --------- ------------
Total Income 40 5 45 - 45
----------- ---------- --------- --------- ------------
EXPENSES
Administration fee 10 2 12 - 12
Investment management fee - - - 23 (d) 23
Accounting fees - - - 2 (d) 2
Amortization of deferred
organization costs - - - - -
Audit 2 1 3 5 (d) 8
Custodian 2 2 4 12 (d) 16
Rembursement of expenses previously
assumed by administrator - - - - (d) -
Distribution fees - - - - -
Legal 21 21 42 5 (d) 47
Registration & filing fees 33 33 66 - 66
Shareholder reports 7 6 13 - 13
Transfer agent 2 1 3 - 3
Trustees 1 1 2 2 (d) 4
Miscellaneous - 1 1 - (d) 1
Portfolio expenses 44 5 49 (49) (d) -
----------- ---------- --------- --------- ------------
Gross 122 73 195 - 195
Reductions ` (65) (67) (132) - (132)
----------- ---------- --------- --------- ------------
Net 57 6 63 - 63
NET INVESTMENT INCOME (LOSS) (17) (1) (18) - (18)
----------- ---------- --------- --------- ------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS FROM CORRESPONDING PORTFOLIO
Net realized gain/loss on
investment securities (15) 6 (9) 9 (e) -
Change in net unrealized appreciation/
depreciation on investments 3,006 375 3,381 (3,381)(e) -
----------- ---------- --------- --------- ------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain/loss on investment
securities (9)(e) (9)
Change in net unrealized appreciation/
depreciation on investments 3,381 (e) 3,381
Net gain (loss) on investments 2,991 381 3,372 - 3,372
----------- ---------- --------- --------- ------------
NET INCREASE (DECREASE) IN NET ASSETS $ 2,974 $ 380 $ 3,354 $ - $ 3,354
RESULTING FROM OPERATIONS
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled affiliated
issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization; however, the
Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
FOCUS
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31, 1999
PRO FORMA
AS REPORTED (UNAUDITED)
---------------------------------------- -----------
EQUITY FUNDS EQUITY TRUST EQUITY ASSETS SUBTOTAL ADJUSTMENTS FOCUS FUND
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio $ 1,327,814 $ 216,696 $ 1,888 $ 1,546,398 $ (1,546,398) (a)
Investment in unaffiliated issuers and
non-controlled af-iliated issues - - - - 1,524,239 (a) $ 1,524,239
Assets net of liabilities at Portfolio - - - - 29,273 (a) 29,273
Deferred organization costs - - 24 24 (24) (b) -
Receivable for Trust shares sold 313 47 3 363 - 363
Receivable from administrator - - 5 5 24 (b) 29
- - - - - -
Subtotal 1,328,127 216,743 1,920 1,546,790 7,114 1,553,904
---------- -------- ------- ---------- ------ ------------
LIABILITIES
Payable for collateral on securities
loaned - - - - 7,114 (a) 7,114
Payable for Fund expenses - - - - - -
Payable for Trust shares redeemed 781 616 - 1,397 - 1,397
Payable to Administrator 307 60 - 367 - 367
Accrued expenses 431 47 21 499 - 499
---------- -------- ------- ---------- ------ ------------
Subtotal 1,519 723 21 2,263 7,114 9,377
---------- -------- ------- ---------- ------ ------------
NET ASSETS - AT VALUE $1,326,608 $ 216,020 $ 1,899 $1,544,527 $ - $1,544,527
=========== ========== ======== =========== ==== ===========
NET ASSETS CONSIST OF
Par value $ 37 $ 9 $ - $ 46 $ - $ 46
Paid-in capital 685,109 154,945 1,362 841,416 - 841,416
Accumulated undistributed net
investment income (loss) 118 - - 118 - 118
Accumulated realized gain/loss 183,643 11,762 195 195,600 - 195,600
Unrealized gain/loss 457,701 49,304 342 507,347 - 507,347
---------- -------- ------- ---------- ------ ------------
NET ASSETS - AT VALUE $1,326,608 $ 216,020 $ 1,899 $1,544,527 $ - $ 1,544,527
=========== ========== ======== =========== ==== ===========
Shares 36,598 9,145 117
NAV $ 36.25 $ 23.62 $ 16.18
Shares - Fund Class 36,598
NAV - Fund Class $ 36.25
$1,326,608
==========
Shares - Trust Class 9,145
NAV - Trust Class $ 23.62
$ 216,020
=========
Shares - Asset Class 117
NAV - Asset Class $ 16.18
$ 1,899
=======
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated issuers, Assets
net of liabilities at Portfolio (if any) and Payables for collateral on securities loaned are being transferred from the Portfolio
to the Fund.
(b) If the proposed reorganization had occurred at August 31, 1999, deferred organization costs, if any, would have been borne by
the administrator; however, these costs are expected to be fully amortized before the date of the reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF OPERATIONS (UNAUDITED)
(000'S OMITTED) PERIOD ENDED
AUGUST 31, 1999
PRO FORMA
AS REPORTED (UNAUDITED)
-----------
EQUITY FUNDS EQUITY TRUST EQUITY ASSETS SUBTOTAL ADJUSTMENTS FOCUS FUND
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Investment income from Portfolio $ 12,149 $ 2,054 $ 14 $ 14,217 $ (14,217) (c) $ -
Dividend income - unaffiliated
issuers - - - - 13,017 (c) 13,017
Dividend income- non-controlled
affiliated issuers - - - - - -
Interest income - - - - 1,237 1,237
Foreign Taxes withheld - - - - (37) (c) (37)
-------- ------- ---- -------- --------- -------
Total Income 12,149 2,054 14 14,217 - 14,217
-------- ------- ---- -------- --------- -------
EXPENSES
Administration fee 3,585 931 6 4,522 - 4,522
Investment management fee - - - - 7,855 (d) 7,855
Accounting fees - - - - 10 (d) 10
Amortization of deferred
organization costs - - 12 12 - 12
Audit 8 5 5 18 45 (d) 63
Custodian 10 10 10 30 273 (d) 303
Insurance expense - - - - 19 (d) 19
Distribution fees - - 3 3 - 3
Legal 7 15 10 32 25 (d) 57
Registration & filing fees 24 49 23 96 - 96
Shareholder reports 159 47 14 220 - 220
Transfer agent 835 20 17 872 - 872
Trustees 20 4 - 24 23 (d) 47
Miscellaneous 38 3 1 42 - (d) 42
Portfolio expenses 7,052 1,190 8 8,250 (8,250) (d) -
-------- ------- ---- -------- --------- -------
GROSS 11,738 2,274 109 14,121 - 14,121
Reductions (3) (60) (86) (149) - (149)
-------- ------- ---- -------- --------- -------
NET 11,735 2,214 23 13,972 - 13,972
-------- ------- ---- -------- --------- -------
NET INVESTMENT INCOME (LOSS) 414 (160) (9) 245 - 245
-------- ------- ---- -------- --------- -------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS FROM CORRESPONDING
PORTFOLIO
Net realized gain/loss on investment
securities 187,154 15,737 216 203,107 (203,107) (e) -
Change in net unrealized appreciation/
depreciation on investments 227,003 55,767 435 283,205 (283,205)(e) -
-------- ------- ---- -------- --------- -------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain/loss on investment
securities 187,154 15,737 216 203,107 203,107 (e) -
Change in net unrealized appreciation
/depreciation on investments 227,003 55,767 435 283,205 283,205 (e) -
-------- ------- ---- -------- --------- -------
Net gain (loss) on investments 414,157 71,504 651 486,312 - 486,312
-------- ------- ---- -------- --------- -------
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS $ 414,571 $ 71,344 $ 642 $ 486,557 $ - $ 486,557
======== ======= ==== ======== ========= =======
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled affiliated
issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization; however, the
Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
GUARDIAN
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES
(UNAUDITED) (000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31, 1999
PRO FORMA
AS REPORTED (UNAUDITED)
---------------------------------------- -----------
EQUITY
EQUITY FUNDS EQUITY TRUST ASSETS SUBTOTAL ADJUSTMENTS GUARDIAN FUND
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investment in corresponding
Portfolio $3,446,910 $1,251,954 $ 24,856 $ 4,723,720 $(4,723,720) (a)
Investment in unaffiliated
issuers and non-controlled
affiliated issuers - - - - 4,643,705 (a) $ 4,643,705
Assets net of liabilities at
Portfolio - - - - 104,452 (a) 104,452
Deferred organization costs - - 23 23 (23) (b) -
Receivable for Trust shares sold 1,652 998 12 2,662 - 2,662
Receivable from administrator - - - - 23 (b) 23
---------- ---------- ------- ---------- ------- ---------
Subtotal 3,448,562 1,252,952 24,891 4,726,405 24,437 4,750,842
---------- ---------- ------- ---------- ------- ---------
LIABILITIES
Payable for collateral on
securities loaned - - - - 24,437 (a) 24,437
Payable for Fund expenses - - - - - -
Payable for Trust shares redeemed 5,508 1,256 - 6,764 - 6,764
Payable to Administrator 804 444 35 1,283 - 1,283
Accrued expenses 1,217 101 27 1,345 - 1,345
---------- ---------- ------- ---------- ------- ---------
Subtotal 7,529 1,801 62 9,392 24,437 33,829
---------- ---------- ------- ---------- ------- ---------
NET ASSETS - AT VALUE $3,441,033 $ 1,251,151 $ 24,829 $ 4,717,013 $ - $4,717,013
=========== ========== ======= ========== ========= =========
NET ASSETS CONSIST OF
Par value $ 151 $ 76 $ 2 $ 229 $ - $ 229
Paid-in capital 2,246,592 881,344 23,900 3,151,836 - 3,151,836
Accumulated undistributed net
investment income (loss) 6,714 2,288 6 9,008 - 9,008
Accumulated realized gain/loss 746,872 227,923 225 975,020 - 975,020
Unrealized gain/loss 440,704 139,520 696 580,920 - 580,920
---------- ---------- ------- ---------- ------- ---------
NET ASSETS - AT VALUE $3,441,033 $ 1,251,151 $ 24,829 $ 4,717,013 $ - $ 4,717,013
=========== ============ ========= ============ ======= ===========
Shares 151,434 76,470 1,834
NAV $ 22.72 $ 16.36 $ 13.54
Shares - Fund Class 151,434
NAV - Fund Class $ 22.72
$3,441,033
==========
Shares - Trust Class 76,470
NAV - Trust Class $ 16.36
$1,251,151
==========
Shares - Asset Class 1,834
NAV - Asset Class $ 13.54
$24,829
==========
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated issuers, Assets
net of liabilities at Portfolio (if any) and Payables for collateral on securities loaned are being transferred from the Portfolio
to the Fund.
(b) If the proposed reorganization had occurred at August 31, 1999, deferred organization costs, if any, would have been borne by
the administrator; however, these costs are expected to be fully amortized before the date of the reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF OPERATIONS (UNAUDITED)
(000'S OMITTED)
PERIOD ENDED AUGUST 31, 1999
PRO FORMA
AS REPORTED (UNAUDITED)
EQUITY ----------
EQUITY FUNDS EQUITY TRUST ASSETS SUBTOTAL ADJUSTMENTS GUARDIAN FUND
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Investment income from Portfolio $ 62,696 $ 23,094 $ 365 $ 86,155 $ (86,155) (c) $ -
Dividend income - unaffiliated issuers - - - - 58,766 (c) 58,766
Dividend income- non-controlled
affiliated issuers - - - - - -
Interest income - - - - 28,189 28,189
Foreign Taxes withheld - - - - (800) (c) (800)
-- -- -- -- ----- -----
Total Income 62,696 23,094 365 86,155 - 86,155
---------- -------- ------ ---------- -------- ---------
EXPENSES
Administration fee 10,690 6,043 95 16,828 - 16,828
Investment management fee - - - - 25,003 (d) 25,003
Accounting fees - - - - 10 (d) 10
Amortization of deferred organization costs - - 12 12 - 12
Audit 9 6 5 20 48 (d) 68
Custodian 10 10 10 30 826 (d) 856
Insurance expense - - - - 88 (d) 88
Distribution fees - - 60 60 - 60
Legal 14 18 11 43 28 (d) 71
Registration & filing fees 48 53 29 130 - 130
Shareholder reports 455 174 22 651 - 651
Transfer agent 3,447 24 16 3,487 - 3,487
Trustees 52 20 - 72 69 (d) 141
Miscellaneous 108 23 2 133 - (d) 133
Portfolio expenses 18,987 6,975 110 26,072 (26,072) (d) -
---------- -------- ------ ---------- -------- ---------
GROSS 33,820 13,346 372 47,538 - 47,538
Reductions (3) (1) (13) (17) - (17)
---------- -------- ------ ---------- -------- ---------
NET 33,817 13,345 359 47,521 - 47,521
---------- -------- ------ ---------- -------- ---------
NET INVESTMENT INCOME (LOSS) 28,879 9,749 6 38,634 - 38,634
---------- -------- ------ ---------- -------- ---------
REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS FROM
CORRESPONDING PORTFOLIO
Net realized gain/loss on
investment securities 761,289 230,720 (164) 991,845 (991,845) (e) -
Change in net unrealized appreciation/
depreciation on investments 244,338 157,393 4,816 406,547 (406,547) (e) -
---------- -------- ------ ---------- -------- ---------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
Net realized gain/loss on investment
securities 991,845 (e) 991,845
Change in net unrealized appreciation/
depreciation on investments 406,547 (e) 406,547
-------- -------
Net gain (loss) on investments 1,005,627 388,113 4,652 1,398,392 - 1,398,392
---------- -------- ------ ---------- -------- ---------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTIING FROM OPERATIONS $1,034,506 $397,862 $ 4,658 $ 1,437,026 $ - $1,437,026
========== ======== ====== ========== ======== =========
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled affiliated
issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization; however, the
Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
MANHATTAN
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31, 1999
PRO FORMA
AS REPORTED (UNAUDITED)
EQUITY ----------
EQUITY FUNDS EQUITY TRUST ASSETS SUBTOTAL ADJUSTMENTS MANHATTAN FUND
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio $ 565,838 $ 45,305 $ 1,717 $ 612,860 $ (612,860) (a)
Investment in unaffiliated issuers
and non-controlled affiliated issuers - - - - 722,750 (a) $ 722,750
Assets net of liabilities at Portfolio - - - - 9,020 (a) 9,020
Deferred organization costs - - 23 23 (23) (b) -
Receivable for Trust shares sold 876 30 - 906 - 906
Receivable from administrator - - 3 3 23 (b) 26
--------- -------- ------- -------- -------- --------
Subtotal 566,714 45,335 1,743 613,792 118,910 732,702
--------- -------- ------- -------- -------- --------
LIABILITIES
Payable for collateral on
securities loaned - - - - 118,910 (a) 118,910
Payable for Fund expenses - - - - - -
Payable for Trust shares redeemed 302 2 - 304 - 304
Payable to Administrator 124 18 - 142 - 142
Accrued expenses 328 31 26 385 - 385
--------- -------- ------- -------- -------- --------
Subtotal 754 51 26 831 118,910 119,741
--------- -------- ------- -------- -------- --------
NET ASSETS - AT VALUE $ 565,960 $ 45,284 $ 1,717 $ 612,961 $ - $ 612,961
========= ======== ======= ======== ======== ========
NET ASSETS CONSIST OF
Par value $ 47 $ 3 $ - $ 50 $ - $ 50
Paid-in capital 401,745 29,810 1,653 433,208 - 433,208
Accumulated undistributed net
investment income (loss) - - - - - -
Accumulated realized gain/loss 52,950 4,426 (7) 57,369 - 57,369
Unrealized gain/loss 111,218 11,045 71 122,334 - 122,334
--------- -------- ------- -------- -------- --------
NET ASSETS - AT VALUE $ 565,960 $ 45,284 $ 1,717 $ 612,961 $ - $ 612,961
========= ======== ======= ======== ======== ========
Shares 46,894 3,014 118
NAV $ 12.07 $ 15.02 $ 14.54
Shares - Fund Class 46,894
NAV - Fund Class $ 12.07
$565,960
========
Shares - Trust Class 3,014
NAV - Trust Class $ 15.02
$ 45,284
========
Shares - Asset Class 118
NAV - Asset Class $ 14.54
$ 1,717
========
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated issuers, Assets
net of liabilities at Portfolio (if any) and Payables for collateral on securities loaned are being transferred from the Portfolio
to the Fund.
(b) If the proposed reorganization had occurred at August 31, 1999, deferred organization costs, if any, would have been borne by
the administrator; however, these costs are expected to be fully amortized before the date of the reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF OPERATIONS (UNAUDITED)
(000'S OMITTED)
PERIOD ENDED AUGUST 31, 1999
PRO FORMA
AS REPORTED (UNAUDITED)
EQUITY ----------
EQUITY FUNDS EQUITY TRUST ASSETS SUBTOTAL ADJUSTMENTS MANHATTAN FUND
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Investment income from Portfolio $ 2,810 $ 257 $ 3 $ 3,070 $ (3,070)(c) $ -
Dividend income - unaffiliated issuers - - - - 1,091 (c) 1,091
Dividend income- non-controlled affiliated
issuers - - - - - -
Interest income - - - - 1,979 1,979
Foreign Taxes withheld - - - - - (c) -
------------ -------- ------- --------- ---------- ----------
Total Income 2,810 257 3 3,070 - 3,070
------------ -------- ------- --------- ---------- ----------
EXPENSES
Administration fee 1,473 207 2 1,682 - 1,682
Investment management fee - - - - 3,282 (d) 3,282
Accounting fees - - - - 10 (d) 10
Amortization of deferred organization costs - - 12 12 - 12
Audit 10 6 7 23 54 (d) 77
Custodian 10 10 10 30 177 (d) 207
Insurance expense - - - - 8 (d) 8
Distribution fees - - 1 1 - 1
Legal 12 16 10 38 20 (d) 58
Registration & filing fees 56 30 22 108 - 108
Shareholder reports 143 23 19 185 - 185
Transfer agent 640 18 17 675 - 675
Trustees 11 1 - 12 12 (d) 24
Miscellaneous 16 2 1 19 14 (d) 33
Portfolio expenses 3,276 298 3 3,577 (3,577)(d) -
------------ -------- ------- --------- ---------- ----------
GROSS 5,647 611 104 6,362 - 6,362
Reductions (5) (37) (96) (138) - (138)
------------ -------- ------- --------- ---------- ----------
NET 5,642 574 8 6,224 - 6,224
------------ -------- ------- --------- ---------- ----------
NET INVESTMENT INCOME (LOSS) (2,832) (317) (5) (3,154) - (3,154)
------------ -------- ------- --------- ---------- ----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS FROM CORRESPONDING PORTFOLIO
Net realized gain/loss on investment
securities 53,255 4,459 (16) 57,698 (57,698)(e) -
Change in net unrealized appreciation
/depreciation on investment 122,884 12,225 99 135,208 (135,208)(e) -
------------ -------- ------- --------- ---------- ----------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain/loss on investment
securities 57,698 (e) 57,698
Change in net unrealized appreciation
/depreciation on investments 135,208 (e) 135,208
---------- ----------
Net gain (loss) on investments 176,139 16,684 83 192,906 - 192,906
------------ -------- ------- --------- ---------- ----------
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATION $ 173,307 $ 16,367 $ 78 $ 189,752 $ - $ 189,752
============ ========= ======= ========= ========== ==========
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled affiliated
issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization; however, the
Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
PARTNERS
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES
(UNAUDITED) (000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
AUGUST 31, 1999
PRO FORMA
AS REPORTED (UNAUDITED)
EQUITY ----------
EQUITY FUNDS EQUITY TRUST ASSETS SUBTOTAL ADJUSTMENTS PARTNERS
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio $ 2,857,082 $ 849,259 $ 62,399 $ 3,768,740 $(3,768,740)(a)
Investment in unaffiliated issuers and
non-controlled affiliated issuers - - - 3,876,069(a) $ 3,876,069
Assets net of liabilities at Portfolio - - - - 32,313 (a) 32,313
Deferred organization costs - - 23 23 (23)(b) -
Receivable for Trust shares sold 1,285 2,336 71 3,692 - 3,692
Receivable from administrator - - - - 23 (b) 23
----------- --------- -------- ----------- ----------- -----------
Subtotal 2,858,367 851,595 62,493 3,772,455 139,642 3,912,097
----------- --------- -------- ----------- ----------- -----------
LIABILITIES
Payable for collateral on securities loaned - - - - 139,642 (a) 139,642
Payable for Fund expenses - - - - - -
Payable for Trust shares redeemed 2,595 1,095 - 3,690 - 3,690
Payable to Administrator 653 297 35 985 - 985
Accrued expenses 761 95 26 882 - 882
----------- --------- -------- ----------- ----------- -----------
Subtotal 4,009 1,487 61 5,557 139,642 145,199
----------- --------- -------- ----------- ----------- -----------
NET ASSETS - AT VALUE $ 2,854,358 $ 850,108 $ 62,432 $ 3,766,898 $ - $ 3,766,898
=========== ========= ======== =========== =========== ===========
NET ASSETS CONSIST OF
Par value $ 108 $ 45 $ 4 $ 157 $ - $ 157
Paid-in capital 2,235,773 732,003 55,230 3,023,006 - 3,023,006
Accumulated undistributed net
investment income (loss) 29,186 7,351 9 36,546 - 36,546
Accumulated realized gain/loss 297,910 46,100 3,288 347,298 - 347,298
Unrealized gain/loss 291,381 64,609 3,901 359,891 - 359,891
----------- --------- -------- ----------- ----------- -----------
NET ASSETS - AT VALUE $ 2,854,358 $ 850,108 $ 62,432 $ 3,766,898 $ - $ 3,766,898
=========== ========= ======== =========== =========== ===========
Shares 108,043 45,432 3,967
NAV $ 26.42 $ 18.71 $ 15.74
Shares - Fund Class 108,043
NAV - Fund Class $ 26.42
$ 2,854,358
===========
Shares - Trust Class 45,432
NAV - Trust Class $ 18.71
$ 850,108
===========
Shares - Asset Class 3,967
NAV - Asset Class $ 15.74
$ 62,432
===========
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated issuers, Assets
net of liabilities at Portfolio (if any) and Payables for collateral on securities loaned are being transferred from the Portfolio
to the Fund.
(b) If the proposed reorganization had occurred at August 31, 1999, deferred organization costs, if any, would have been borne by
the administrator; however, these costs are expected to be fully amortized before the date of the reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF OPERATIONS (UNAUDITED)
(000'S OMITTED)
PERIOD ENDED AUGUST 31, 1999
PRO FORMA
AS REPORTED (UNAUDITED)
EQUITY ----------
EQUITY FUNDS EQUITY TRUST ASSETS SUBTOTAL ADJUSTMENTS PARTNERS FUND
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Investment income from Portfolio $ 54,515 $ 15,361 $ 1,042 $ 70,918 $ (70,918)(c) $ -
Dividend income - unaffiliated issuers - - - - 66,443 (c) 66,443
Dividend income- non-controlled
affiliated issuers - - - - - -
Interest income - - - - 4,684 4,684
Foreign Taxes withheld - - - - (209)(c) (209)
--------- -------- ------- -------- --------- ------------
Total Income 54,515 15,361 1,042 70,918 - 70,918
--------- -------- ------- -------- --------- ------------
EXPENSES
Administration fee 8,070 3,528 243 11,841 - 11,841
Investment management fee - - - - 18,165 (d) 18,165
Accounting fees - - - - 10 (d) 10
Amortization of deferred organization costs - - 12 12 - 12
Audit 9 5 5 19 47 (d) 66
Custodian 10 10 10 30 617 (d) 647
Insurance expense - - - - 48 (d) 48
Distribution fees - - 151 151 - 151
Legal 11 13 10 34 18 (d) 52
Registration & filing fees 184 156 36 376 - 376
Shareholder reports 347 120 21 488 - 488
Transfer agent 2,051 20 17 2,088 - 2,088
Trustees 40 12 1 53 50 (d) 103
Miscellaneous 78 10 2 90 - (d) 90
Portfolio expenses 14,533 4,137 285 18,955 (18,955)(d) -
--------- -------- ------- -------- ------ ------------
GROSS 25,333 8,011 793 34,137 - 34,137
Reductions (4) (1) - (5) - (5)
--------- -------- ------- -------- ------ ------------
NET 25,329 8,010 793 34,132 - 34,132
--------- -------- ------- -------- ------ ------------
NET INVESTMENT INCOME (LOSS) 29,186 7,351 249 36,786 - 36,786
--------- -------- ------- -------- ------ ------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS FROM CORRESPONDING PORTFOLIO
Net realized gain/loss on investment
securities 304,202 45,924 3,694 353,820 (353,820)(e) -
Change in net unrealized appreciation
/depreciation investment 381,420 141,300 8,416 531,136 (531,136)(e) -
--------- -------- ------- -------- ------- ------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain/loss on investment
securities 353,820 (e) 353,820
Change in net unrealized appreciation
/depreciation on investments 531,136 (e) 531,136
------- ------------
Net gain (loss) on investments 685,622 187,224 12,110 884,956 - 884,956
--------- -------- ------- -------- ------- ------------
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS $ 714,808 $194,575 $12,359 $921,742 $ - $ 921,742
========= ======== ======== ========= ======= ============
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled affiliated
issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization; however, the
Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
TECHNOLOGY
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
JUNE 30, 2000
PRO FORMA
AS REPORTED (UNAUDITED)
---------------------------------------- -----------
<S> <C> <C> <C> <C> <C>
TECHNOLOGY
EQUITY FUNDS EQUITY TRUST SUBTOTAL ADJUSTMENTS FUND
ASSETS
Investment in corresponding Portfolio $ 16,040 $ 2,112 $ 18,152 $ (18,152)(a)
Investment in unaffiliated issuers and
non-controlled affiliated issuers - - - 18,119 (a) $ 18,119
Assets net of liabilities at Portfolio - - - 33 (a) 33
Deferred organization costs - - - - (b) -
Receivable for Trust shares sold - - - - -
Receivable from administrator 26 33 59 - (b) 59
------------ ------------ -------- ---------- -----------
Subtotal 16,066 2,145 18,211 - 18,211
------------ ------------ -------- ---------- -----------
LIABILITIES
Payable for collateral on securities loaned - - - - (a) -
Payable for Fund expenses - - - - -
Payable for Trust shares redeemed - - - - -
Payable to Administrator - - - - -
Accrued expenses 16 17 33 - 33
------------ ------------ -------- ---------- -----------
Subtotal 16 17 33 - 33
------------ ------------ -------- ---------- -----------
NET ASSETS - AT VALUE $ 16,050 $ 2,128 $ 18,178 $ - $ 18,178
=========== =========== ======== ========== ===========
NET ASSETS CONSIST OF
Par value $ 2 $ - $ 2 $ - $ 2
Paid-in capital 14,598 2,001 16,599 - 16,599
Accumulated undistributed net
investment income (loss) 28 5 33 - 33
Accumulated realized gain/loss (71) (11) (82) - (82)
Unrealized gain/loss 1,493 133 1,626 - 1,626
------------ ------------ -------- ---------- -----------
NET ASSETS - AT VALUE $ 16,050 $ 2,128 $ 18,178 $ - $ 18,178
=========== =========== ======== ========== ===========
Shares 1,509 200
NAV $ 10.64 $ 10.63
Shares - Fund Class 1,509
NAV - Fund Class $ 10.64
$ 16,050
===========
Shares - Trust Class 200
NAV - Trust Class $ 10.63
$ 2,128
===========
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated issuers, Assets
net of liabilities at Portfolio (if any) and Payables for collateral on securities loaned are being transferred from the Portfolio
to the Fund.
(b) If the proposed reorganization had occurred at June 30, 2000, deferred organization costs, if any, would have been borne by the
administrator; however, these costs are expected to be fully amortized before the date of the reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
JUNE 30, 2000
PRO FORMA
AS REPORTED (UNAUDITED)
---------------------------------------- -----------
<S> <C> <C> <C> <C> <C>
TECHNOLOGY
EQUITY FUNDS EQUITY TRUST SUBTOTAL ADJUSTMENTS FUND
INVESTMENT INCOME
Investment income from Portfolio $ 65 $ 11 $ 76 $ (76)(c) $ -
Dividend income - unaffiliated issuers - - - 5 (c) 5
Dividend income- non-controlled
affiliated issuers - - - - -
Interest income - - - 71 71
Foreign Taxes withheld - - - - (c) -
------------ ------------ -------- ----------- -----------
Total Income 65 11 76 - 76
------------ ------------ -------- ----------- -----------
EXPENSES
Administration fee 5 1 6 - 6
Investment management fee - - - 18 (d) 18
Accounting fees - - - - (d) -
Amortization of deferred organization costs - - - - -
Audit 2 3 5 7 (d) 12
Custodian 2 2 4 6 (d) 10
Insurance expense - - - - (d) -
Distribution fees - - - - -
Legal 2 2 4 2 (d) 6
Registration & filing fees - - - - -
Shareholder reports 5 5 10 - 10
Transfer agent - - - - -
Trustees - - - 1 (d) 1
Miscellaneous 22 22 44 1 (d) 45
Portfolio expenses 30 5 35 (35)(d) -
------------ ------------ -------- ----------- -----------
GROSS 68 40 108 - 108
Reductions (31) (34) (65) - (65)
------------ ------------ -------- ----------- -----------
NET 37 6 43 - 43
------------ ------------ -------- ----------- -----------
NET INVESTMENT INCOME (LOSS) 28 5 33 - 33
------------ ------------ -------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS FROM CORRESPONDING PORTFOLIO
Net realized gain/loss on investment
securities (71) (11) (82) 82 (e) -
Change in net unrealized appreciation
/depreciation investments 1,493 133 1,626 (1,626)(e) -
------------ ------------ -------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain/loss on investment
securities (82)(e) (82)
Change in net unrealized appreciation
/depreciation on investments 1,626 (e) 1,626
------------ ------------ ----------- -----------
Net gain (loss) on investments 1,422 122 1,544 - 1,544
------------ ------------ -------- ----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM 0PERATIONS $ 1,450 $ 127 $ 1,577 $ - $ 1,577
============ ============ ======== =========== ===========
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled affiliated
issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization; however, the
Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
Most of the following Pro Forma
combining financial information is as of
October 31, 1999 and the fiscal period
then ended, except for Institutional
Cash Trust. Because Institutional Cash
Trust started operations after October
31, 1999 its information is as of June
30, 2000 and the fiscal period then
ended.
GOVERNMENT MONEY
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES
(UNAUDITED) (000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
OCTOBER 31, 1999
PRO FORMA
AS REPORTED (UNAUDITED)
--------------------------------- -----------
GOVERNMENT
INCOME FUND SUBTOTAL ADJUSTMENTS MONEY FUND
<S> <C> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio $ 653,867 $ 653,867 $ (653,867) (a)
Investment in unaffiliated issuers and
non-controlled af-iliated issuers - - 649,515 (a) $ 649,515
Assets net of liabilities at Portfolio - - 4,352 (a) 4,352
Deferred organization costs - - - (b) -
Receivable for Trust shares sold 377 377 - 377
Receivable from administrator - - - (b) -
--------- --------- ---------- ---------
Subtotal 654,244 654,244 - 654,244
--------- --------- ---------- ---------
LIABILITIES
Dividends Payable 12 12 - (a) 12
Payable for Fund expenses - - - -
Payable for Trust shares redeemed 616 616 - 616
Payable to Administrator 156 156 - 156
Accrued expenses 83 83 - 83
--------- --------- ---------- ---------
Subtotal 867 867 - 867
--------- --------- ---------- ---------
NET ASSETS - AT VALUE $ 653,377 $ 653,377 $ - $ 653,377
========= ========= ========== =========
NET ASSETS CONSIST OF
Par value $ 653 $ 653 $ - $ 653
Paid-in capital 652,724 652,724 - 652,724
Dividends in excess of net investment income - - - -
Accumulated realized gain/loss - - - -
Unrealized gain/loss - - - -
--------- --------- ---------- ---------
NET ASSETS - AT VALUE $ 653,377 $ 653,377 $ - $ 653,377
========= ========= ========== =========
Shares 653,377
NAV $ 1.00
Shares - Fund Class 653,377
NAV - Fund Class $ 1.00
$ 653,377
=========
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated issuers, Assets
net of liabilities at Portfolio (if any) and Payables for collateral on securities loaned are being transferred from the Portfolio
to the Fund.
(b) If the proposed reorganization had occurred at October 31, 1999, deferred organization costs, if any, would have been borne by
the administrator; however, these costs are expected to be fully amortized before the date of the reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES
(UNAUDITED) (000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
OCTOBER 31, 1999
PRO FORMA
AS REPORTED (UNAUDITED)
--------------------------------- -----------
GOVERNMENT
INCOME FUND SUBTOTAL ADJUSTMENTS MONEY FUND
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Investment income from Portfolio $ 28,027 $ 28,027 $ (28,027) (c) $ -
Interest income - - 28,027 28,027
--------- -------- --------- --------
Total Income 28,027 28,027 - 28,027
--------- -------- --------- --------
EXPENSES
Administration fee 1,621 1,621 - 1,621
Investment management fee - - 1,479 (d) 1,479
Accounting fees - - 10 (d) 10
Amortization of deferred organization costs - - - -
Audit 9 9 26 (d) 35
Custodian 10 10 136 (d) 146
Insurance expense - - 5 (d) 5
Rembursement of expenses previously assumed
by administrator - - - -
Legal 14 14 13 (d) 27
Registration & filing fees 34 34 - 34
Shareholder reports 39 39 - 39
Transfer agent 96 96 - 96
Trustees 33 33 34 (d) 67
Miscellaneous 30 30 - (d) 30
Portfolio expenses 1,703 1,703 (1,703)(d) -
--------- -------- ---------- --------
GROSS 3,589 3,589 - 3,589
Reductions - - - -
--------- -------- ---------- --------
NET 3,589 3,589 - 3,589
--------- -------- ---------- --------
NET INVESTMENT INCOME (LOSS) 24,438 24,438 - 24,438
--------- -------- ---------- --------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS FROM CORRESPONDING PORTFOLIO
Net realized gain/loss on investment securities - - - (e) -
Change in net unrealized appreciation
/depreciation on investments - - - (e) -
--------- -------- ---------- --------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain/loss on investment
securities - - (e) -
Change in net unrealized appreciation
/depreciation on investments - - (e) -
--------- -------- ---------- --------
Net gain (loss) on investments - - - -
--------- -------- ---------- --------
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS $ 24,438 $ 24,438 $ - $ 24,438
========= ======== ========== ========
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled affiliated
issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization; however, the
Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
Cash Reserves
Pro Forma Combining Statement of Assets and Liabilities (unaudited)
(000's omitted except for per share amounts)
October 31, 1999
Pro Forma
As Reported (unaudited)
----------------- --------------
<S> <C> <C> <C> <C>
Income Fund Subtotal Adjustments Cash Reserves
ASSETS
Investment in corresponding Portfolio $ 1,105,633 $ 1,105,633 $(1,105,633) (a)
Investment in unaffiliated issuers and non-
controlled affiliated issuers - - 1,101,217 (a) $ 1,101,217
Assets net of liabilities at Portfolio - - 4,416 (a) 4,416
Deferred organization costs - - - (b) -
Receivable for Trust shares sold 1,069 1,069 - 1,069
Receivable from administrator - - - (b) -
----------- ----------- ----------- -----------
Subtotal 1,106,702 1,106,702 - 1,106,702
----------- ----------- ----------- -----------
LIABILITIES
Dividends Payable 30 30 - (a) 30
Payable for Fund expenses - - - -
Payable for Trust shares redeemed 2,051 2,051 - 2,051
Payable to Administrator 262 262 - 262
Accrued expenses 194 194 - 194
----------- ----------- ----------- -----------
Subtotal 2,537 2,537 - 2,537
Net Assets - at value $ 1,104,165 $ 1,104,165 $ - $ 1,104,165
Net Assets consist of
Par value $ 1,104 $ 1,104 $ - $ 1,104
Paid-in capital 1,103,087 1,103,087 - 1,103,087
Dividends in excess of net investment income
- - - -
Accumulated realized gain/loss (26) (26) - (26)
Unrealized gain/loss - - - -
Net Assets - at value $ 1,104,165 $ 1,104,165 $ - $ 1,104,165
----------- ----------- ----------- -----------
Shares 1,104,191
NAV $ 1.00
Shares - Fund Class 1,104,191
NAV - Fund Class $ 1.00
$ 1,104,165
-----------
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled
affiliated issuers, Assets net of liabilities at Portfolio (if any) and Payables for collateral on
securities loaned are being transferred from the Portfolio to the Fund.
(b) If the proposed reorganization had occurred at October 31, 1999, deferred organization costs, if any,
would have been borne by the administrator; however, these costs are expected to be fully amortized
before the date of the reorganization.
<PAGE>
Pro Forma Combining Statement of Operations (unaudited)
(000's omitted)
Period ended October 31, 1999
Pro Forma
As Reported (unaudited)
----------------- --------------
<S> <C> <C> <C> <C>
Income Fund Subtotal Adjustments Cash Reserves
Investment income
Investment income from Portfolio $ 54,196 $ 54,196 $ (54,196) (c) $ -
Interest income - - 54,196 54,196
---------- --------- ----------- -------------
Total Income 54,196 54,196 - 54,196
---------- --------- ----------- -------------
Expenses
Administration fee 2,845 2,845 - 2,845
Investment management fee - - 2,487 (d) 2,487
Accounting fees - - 10 (d) 10
Amortization of deferred organization costs - - - -
Audit 9 9 27 (d) 36
Custodian 10 10 225 (d) 235
Insurance expense - - 9 (d) 9
Rembursement of expenses previously
assumed by administrator - - - -
Legal 16 16 23 (d) 39
Registration & filing fees 74 74 - 74
Shareholder reports 98 98 - 98
Transfer agent 384 384 - 384
Trustees 52 52 54 (d) 106
Miscellaneous 48 48 - (d) 48
Portfolio expenses 2,835 2,835 (2,835) (d) -
---------- --------- ----------- -------------
Gross 6,371 6,371 - 6,371
---------- --------- ----------- -------------
Reductions - - - -
---------- --------- ----------- -------------
Net 6,371 6,371 - 6,371
Net Investment Income (Loss) 47,825 47,825 - 47,825
Realized and Unrealized Gain (Loss) on
Investments from Corresponding Portfolio
Net realized gain/loss on investment
securities (4) (4) 4 (e) -
Change in net unrealized
appreciation/depreciation on investments - - - (e) -
---------- --------- ----------- -------------
Realized and Unrealized Gain (Loss) on
Investments
Net realized gain/loss on investment
securities - (4) (e) (4)
Change in net unrealized
appreciation/depreciation on investments - - (e) -
---------- ----------- -------------
Net gain (loss) on investments (4) (4) - (4)
---------- --------- ----------- -------------
Net increase (decrease) in net assets
resulting from operations $ 47,821 47,821 - 47,821
---------- --------- ----------- -------------
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or
non-controlled affiliated issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the
reorganization; however, the Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the
Fund directly.
<PAGE>
High Yield
Pro Forma Combining Statement of Assets and Liabilities (unaudited)
(000's omitted except for per share amounts)
October 31, 1999
Pro Forma
As Reported (unaudited)
----------------- --------------
<S> <C> <C> <C> <C>
Income Fund Subtotal Adjustments High Yield
ASSETS
Investment in corresponding Portfolio $ 24,022 $ 24,022 $ (24,022)(a)
Investment in unaffiliated issuers and non
and non-controlled affiliated issuers - - 23,397 (a) $ 23,397
Assets net of liabilities at Portfolio - - 625 (a) 625
Deferred organization costs 48 48 (48)(b) -
Receivable for Trust shares sold 1 1 - 1
Receivable from administrator - - 48 (b) 48
----------- --------- ----------- ------------
Subtotal 24,071 24,071 - 24,071
----------- --------- ----------- ------------
LIABILITIES
Dividends Payable 77 77 - (a) 77
Payable for Fund expenses - - - -
Payable for Trust shares redeemed 165 165 - 165
Payable to Administrator 7 7 - 7
Accrued expenses 16 16 - 16
----------- --------- ----------- ------------
Subtotal 265 265 - 265
----------- --------- ----------- ------------
Net Assets - at value $ 23,806 $ 23,806 $ - $ 23,806
----------- --------- ----------- ------------
Net Assets consist of
Par value $ 3 $ 3 $ - $ 3
Paid-in capital 27,495 27,495 - 27,495
Dividends in excess of net investment income - - - -
Accumulated realized gain/loss (1,248) (1,248) - (1,248)
Unrealized gain/loss (2,444) (2,444) - (2,444)
----------- --------- ----------- ------------
Net Assets - at value $ 23,806 $ 23,806 $ - $ 23,806
Shares 2,744
NAV $ 8.68
Shares - Fund Class 2,744
NAV - Fund Class $ 8.68
$ 23,806
------------
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled
affiliated issuers, Assets net of liabilities at Portfolio (if any) and Payables for collateral on
securities loaned are being transferred from the Portfolio to the Fund.
(b) If the proposed reorganization had occurred at October 31, 1999, deferred organization costs, if any,
would have been borne by the administrator; however, these costs are expected to be fully amortized
before the date of the reorganization.
<PAGE>
Pro Forma Combining Statement of Operations (unaudited)
(000's omitted)
Period ended October 31, 1999
Pro Forma
As Reported (unaudited)
--------------
<S> <C> <C> <C> <C>
Income Fund Subtotal Adjustments High Yield
Investment income
Investment income from Portfolio $ 2,658 $ 2,658 $ (2,658)(c) $ -
Interest income - - 2,658 2,658
----------- --------- ----------- ----------
Total Income 2,658 2,658 - 2,658
----------- --------- ----------- ----------
Expenses
Administration fee 71 71 - 71
Investment management fee - - 100 (d) 100
Accounting fees - - 10 (d) 10
Amortization of deferred Organization costs 14 14 - 14
Audit 5 5 23 (d) 28
Custodian 10 10 36 (d) 46
Insurance expense - - - (d) -
Rembursement of expenses previously
assumed by administrator - - - -
Legal 18 18 17 (d) 35
Registration & filing fees 23 23 - 23
Shareholder reports 11 11 - 11
Transfer agent 22 22 - 22
Trustees 6 6 6 (d) 12
Miscellaneous 2 2 - (d) 2
Portfolio expenses 192 192 (192)(d) -
----------- --------- ----------- ----------
Gross 374 374 - 374
Reductions (112) (112) - (112)
----------- --------- ----------- ----------
Net 262 262 - 262
----------- --------- ----------- ----------
Net Investment Income (Loss) 2,396 - 2,396 2,396
Realized and Unrealized Gain (Loss) on
Investments from Corresponding Portfolio
Net realized gain/loss on investment
securities (1,206) (1,206) 1,206 (e) -
Change in net unrealized
appreciation/depreciation on investments (783) (783) 783 (e) -
----------- --------- ----------- ----------
Realized and Unrealized Gain (Loss) on
Investments
Net realized gain/loss on investment
securities - (1,206)(e) (1,206)
Change in net unrealized
appreciation/depreciation on investments - (783)(e) (783)
----------- ----------- ----------
Net gain (loss) on investments (1,989) (1,989) - (1,989)
----------- --------- ----------- ----------
Net increase (decrease) in net assets
resulting from operations $ 407 $ 407 $ - $ 407
----------- --------- ----------- ----------
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or
non-controlled affiliated issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the
reorganization; however, the Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the
Fund directly.
<PAGE>
Municipal Money
Pro Forma Combining Statement of Assets and Liabilities (unaudited)
(000's omitted except for per share amounts)
October 31, 1999
Pro Forma
As Reported (unaudited)
----------------- --------------
<S> <C> <C> <C> <C>
Municipal
Income Fund Subtotal Adjustments Money Fund
ASSETS
Investment in corresponding Portfolio $ 293,992 $ 293,992 $ (293,992) (a)
Investment in unaffiliated issuers and non-
controlled affiliated issuers - - 286,756 (a) $ 286,756
Assets net of liabilities at Portfolio - - 7,236 (a) 7,236
Deferred organization costs - - - (b) -
Receivable for Trust shares sold 8 8 - 8
Receivable from administrator - - - (b) -
----------- --------- ------------ ----------
Subtotal 294,000 294,000 - 294,000
----------- --------- ------------ ----------
LIABILITIES
Dividends Payable 4 4 - (a) 4
Payable for Fund expenses - - - -
Payable for Trust shares redeemed 111 111 - 111
Payable to Administrator 67 67 - 67
Accrued expenses 44 44 - 44
----------- --------- ------------ ----------
Subtotal 226 226 - 226
----------- --------- ------------ ----------
Net Assets - at value $ 293,774 $ 293,774 $ - $ 293,774
----------- --------- ------------ ----------
Net Assets consist of
Par value $ 294 $ 294 $ - $ 294
Paid-in capital 293,479 293,479 - 293,479
Dividends in excess of net - - - -
Accumulated realized gain/loss 1 1 - 1
Unrealized gain/loss - - - -
----------- --------- ------------ ----------
Net Assets - at value $ 293,774 $ 293,774 $ - $ 293,774
----------- --------- ------------ ----------
Shares 293,846
NAV $ 1.00
Shares - Fund Class 293,846
NAV - Fund Class $ 1.00
$ 293,774
----------
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled
affiliated issuers, Assets net of liabilities at Portfolio (if any) and Payables for collateral on
securities loaned are being transferred from the Portfolio to the Fund.
(b) If the proposed reorganization had occurred at October 31, 1999, deferred organization costs, if any,
would have been borne by the administrator; however, these costs are expected to be fully amortized
before the date of the reorganization.
<PAGE>
Pro Forma Combining Statement of Operations (unaudited)
(000's omitted)
Period ended October 31, 1999
Pro Forma
As Reported (unaudited)
--------------
<S> <C> <C> <C> <C>
Municipal
Income Fund Subtotal Adjustments Money Fund
Investment income
Investment income from Portfolio $ 7,259 $ 7,259 $ (7,259)(c) $ -
Interest income - - 7,259 7,259
----------- --------- ------------ ----------
Total Income 7,259 7,259 - 7,259
----------- --------- ------------ ----------
Expenses
Administration fee 604 604 - 604
Investment management fee - - 560 (d) 560
Accounting fees - - 10 (d) 10
Amortization of deferred organization costs - - - -
Audit 9 9 33 (d) 42
Custodian 10 10 123 (d) 133
Insurance expense - - 2 (d) 2
Rembursement of expenses previously
assumed by administrator - - - -
Legal 15 15 13 (d) 28
Registration & filing fees 27 27 - 27
Shareholder reports 28 28 - 28
Transfer agent 33 33 - 33
Trustees 15 15 15 (d) 30
Miscellaneous 10 10 - (d) 10
Portfolio expenses 756 756 (756)(d) -
----------- --------- ------------ ----------
Gross 1,507 1,507 - 1,507
Reductions (7) (7) - (7)
----------- --------- ------------ ----------
Net 1,500 1,500 - 1,500
----------- --------- ------------ ----------
Net Investment Income (Loss) 5,759 5,759 - 5,759
----------- --------- ------------ ----------
Realized and Unrealized Gain (Loss) on
Investments from Corresponding Portfolio
Net realized gain/loss on investment
securities 1 1 (1)(e) -
Change in net unrealized
appreciation/depreciation on investments - - - (e) -
----------- --------- ------------ ----------
Realized and Unrealized Gain (Loss) on
Investments
Net realized gain/loss on investment
securities - 1 (e) 1
Change in net unrealized
appreciation/depreciation on investments - - (e) -
----------- ------------ ----------
Net gain (loss) on investments 1 1 - 1
----------- --------- ------------ ----------
Net increase (decrease) in net assets
resulting from operations $ 5,760 $ 5,760 $ - $ 5,760
----------- --------- ------------ ----------
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or
non-controlled affiliated issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the
reorganization; however, the Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the
Fund directly.
<PAGE>
MUNICIPAL SECURITIES TRUST
Pro Forma Combining Statement of Assets and Liabilities (unaudited)
(000's omitted except for per share amounts)
October 31, 1999
Pro Forma
As Reported (unaudited)
----------------- -----------------
<S> <C> <C> <C> <C>
Municipal
Income Fund Subtotal Adjustments Securities Trust
ASSETS
Investment in corresponding Portfolio $ 34,987 $ 34,987 $ (34,987) (a)
Investment in unaffiliated issuers and non-
controlled affiliated issuers - - 34,506 (a) $ 34,506
Assets net of liabilities at Portfolio - - 481 (a) 481
Deferred organization costs - - - (b) -
Receivable for Trust shares sold 40 40 - 40
Receivable from administrator 4 4 - (b) 4
----------- --------- ----------- ------------
Subtotal 35,031 35,031 - 35,031
----------- --------- ----------- ------------
LIABILITIES
Dividends Payable 39 39 - (a) 39
Payable for Fund expenses - - - -
Payable for Trust shares redeemed - - - -
Payable to Administrator - - - -
Accrued expenses 35 35 - 35
----------- --------- ----------- ------------
Subtotal 74 74 - 74
----------- --------- ----------- ------------
Net Assets - at value $ 34,957 $ 34,957 $ - $ 34,957
----------- --------- ----------- ------------
Net Assets consist of
Par value $ 3 $ 3 $ - $ 3
Paid-in capital 35,657 35,657 - 35,657
Dividends in excess of net investment income - - - -
Accumulated realized gain/loss (125) (125) - (125)
Unrealized gain/loss (578) (578) - (578)
----------- --------- ----------- ------------
Net Assets - at value $ 34,957 34,957 - $ 34,957
----------- --------- ----------- ------------
Shares 3,244
NAV $ 10.78
Shares - Fund Class 3,244
NAV - Fund Class $ 10.78
$ 34,957
------------
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled
affiliated issuers, Assets net of liabilities at Portfolio (if any) and Payables for collateral on
securities loaned are being transferred from the Portfolio to the Fund.
(b) If the proposed reorganization had occurred at October 31, 1999, deferred organization costs, if any,
would have been borne by the administrator; however, these costs are expected to be fully amortized
before the date of the reorganization.
<PAGE>
Pro Forma Combining Statement of Operations (unaudited)
(000's omitted)
Period ended October 31, 1999
Pro Forma
As Reported (unaudited)
----------------- -----------------
<S> <C> <C> <C> <C>
Municipal
Income Fund Subtotal Adjustments Securities Trust
Investment income
Investment income from Portfolio $ 1,780 $ 1,780 $ (1,780) (c) $ -
Interest income - - 1,780 1,780
----------- --------- ----------- ------------
Total Income 1,780 1,780 - 1,780
----------- --------- ----------- ------------
Expenses
Administration fee 103 103 - 103
Investment management fee - - 95 (d) 95
Accounting fees - - 10 (d) 10
Amortization of deferred organization costs
Audit 8 8 25 (d) 33
Custodian 10 10 34 (d) 44
Insurance expense - - - (d) -
Rembursement of expenses previously
assumed by administrator - - - -
Legal 15 15 13 (d) 28
Registration & filing fees 25 25 - 25
Shareholder reports 22 22 - 22
Transfer agent 30 30 - 30
Trustees 7 7 7 (d) 14
Miscellaneous 3 3 - (d) 3
Portfolio expenses 184 184 (184) (d) -
----------- --------- ----------- ------------
Gross 407 407 - 407
Reductions (159) (159) - (159)
----------- --------- ----------- ------------
Net 248 248 - 248
----------- --------- ----------- ------------
Net Investment Income (Loss) 1,532 1,532 - 1,532
----------- --------- ----------- ------------
Realized and Unrealized Gain (Loss) on
Investments from Corresponding Portfolio
Net realized gain/loss on investment
securities 122 122 (122) (e) -
Change in net unrealized
appreciation/depreciation on investments (2,049) (2,049) 2,049 (e) -
----------- --------- ----------- ------------
Realized and Unrealized Gain (Loss) on
Investments
Net realized gain/loss on investment
securities - 122 (e) 122
Change in net unrealized
appreciation/depreciation on investments - (2,049) (e) (2,049)
----------- ----------- ------------
Net gain (loss) on investments (1,927) (1,927) - (1,927)
----------- --------- ----------- ------------
Net increase (decrease) in net assets
resulting from operations $ (395) $ (395) - $ (395)
----------- --------- ----------- ------------
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or
non-controlled affiliated issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the
reorganization; however, the Company is unable to estimate the reduction. (e) Realized and unrealized
gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
INSTITUTIONAL CASH
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
JUNE 30, 2000
AS REPORTED PRO FORMA
------------------------ (UNAUDITED)
----------
INSTITUTIONAL
INCOME TRUST SUBTOTAL ADJUSTMENTS CASH FUND
<S> <C> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio $ 326,686 $ 326,686 $ (326,686)(a)
Investment in unaffiliated issuers and
non-controlled affiliated issuers - - 326,555 (a) $ 326,555
Assets net of liabilities at Portfolio - - 131 (a) 131
Deferred organization costs - - (b) -
Receivable for Trust shares sold - - - -
Receivable from administrator - - - (b) -
----------- ----------- ----------- -----------
Subtotal 326,686 326,686 - 326,686
LIABILITIES
Dividends Payable 1,503 1,503 - (a) 1,503
Payable for Fund expenses - - - -
Payable for Trust shares redeemed - - - -
Payable to Administrator 30 30 - 30
Accrued expenses 20 20 - 20
----------- ----------- ----------- -----------
Subtotal 1,553 1,553 - 1,553
----------- ----------- ----------- -----------
NET ASSETS - AT VALUE $ 325,133 325,133 - 325,133
NET ASSETS CONSIST OF
Par value $ 325 325 - 325
Paid-in capital 324,808 324,808 - 324,808
Dividends in excess of net
investment income - - - -
Accumulated realized gain/loss - - - -
Unrealized gain/loss - - - -
----------- ----------- ----------- -----------
NET ASSETS - AT VALUE $ 325,133 $ 325,133 $ - $ 325,133
=========== =========== =========== ===========
Shares 325,133
NAV $ 1.00
Shares - Trust Class 325,133
NAV - Trust Class $ 1.00
$ 325,133
===========
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated
issuers, Assets net of liabilities at Portfolio (if any) and Payables for collateral on securities loaned are being
transferred from the Portfolio to the Fund.
(b) If the proposed reorganization had occurred at June 30, 2000, deferred organization costs, if any, would have been
borne by the administrator; however, these costs are expected to be fully amortized before the date of the
reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
JUNE 30, 2000
AS REPORTED PRO FORMA
------------------------ (UNAUDITED)
----------
INSTITUTIONAL
INCOME TRUST SUBTOTAL ADJUSTMENTS CASH FUND
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Investment income from Portfolio $ 1,871 $ 1,871 $ (1,871)(c) $ -
Interest income - - 1,871 1,871
----------- ---------- ---------- -----------
Total Income 1,871 1,871 - 1,871
----------- ---------- ---------- -----------
EXPENSES
Administration fee 40 40 - 40
Investment management fee - - 27 (d) 27
Accounting fees - - - (d) -
Amortization of deferred
organization costs - - - -
Audit 3 3 7 (d) 10
Custodian 2 2 11 (d) 13
Insurance expense - - - (d) -
Rembursement of expenses previously
assumed by administrator - - - -
Legal 2 2 3 (d) 5
Registration & filing fees - - - -
Shareholder reports 6 6 - 6
Transfer agent - - - -
Trustees 1 1 3 (d) 4
Miscellaneous 14 14 - (d) 14
Portfolio expenses 51 51 (51)(d) -
----------- ---------- ---------- -----------
GROSS
119 119 - 119
Reductions (10) (10) - (10)
NET 109 109 - 109
NET INVESTMENT INCOME (LOSS) 1,762 1,762 - 1,762
----------- ---------- ---------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS FROM CORRESPONDING PORTFOLIO
Net realized gain/loss on investment securities - - - (e) -
Change in net unrealized appreciation/
depreciation on investments - - - (e) -
----------- ---------- ---------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain/loss on investment securities - - (e) -
Change in net unrealized appreciation/
depreciation on investments - - (e) -
Net gain (loss) on investments - - - -
----------- ---------- ---------- -----------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ 1,762 $ 1,762 $ - $ 1,762
=========== ========== ========== ===========
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled
affiliated issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization;
however, the Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
<PAGE>
LIMITED MATURITY BOND
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES
(UNAUDITED) (000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
OCTOBER 31, 1999
PRO FORMA
AS REPORTED (UNAUDITED)
--------------------------------- -----------
LIMITED MATURITY
INCOME FUND INCOME TRUST SUBTOTAL ADJUSTMENTS BOND FUND
<S> <C> <C> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio $ 228,422 $ 41,705 $ 270,127 $ (270,127)(a)
Investment in unaffiliated issuers and $
non-controlled affiliated issuers - - - 274,289 (a) $ 274,289
Assets net of liabilities at Portfolio - - - - (a) -
Deferred organization costs - - - - (b) -
Receivable for Trust shares sold 26 45 71 - 71
Receivable from administrator - - - - (b) -
----------- ----------- ---------- ----------- -----------
Subtotal 228,448 41,750 270,198 4,162 274,360
----------- ----------- ---------- ----------- -----------
LIABILITIES
Dividends Payable 244 1 245 - (a) 245
Liabilities net of expenses
at Portfolio - - - 4,162 4,162
Payable for Trust shares redeemed 1,006 103 1,109 - 1,109
Payable to Administrator 62 21 83 - 83
Accrued expenses 95 76 171 - 171
----------- ----------- ---------- ----------- -----------
Subtotal 1,407 201 1,608 4,162 5,770
NET ASSETS - AT VALUE $ 227,041 $ 41,549 $ 268,590 $ - $ 268,590
=========== =========== ========== =========== ===========
NET ASSETS CONSIST OF
Par value $ 24 5 $ 29 $ - $ 29
Paid-in capital 252,925 44,408 297,333 - 297,333
Dividends in excess of net
investment income (105) (1) (106) - (106)
Accumulated realized gain/loss (20,369) (1,584) (21,953) - (21,953)
Unrealized gain/loss (5,434) (1,279) (6,713) - (6,713)
----------- ----------- ---------- ----------- -----------
NET ASSETS - AT VALUE $ 227,041 $ 41,549 $ 268,590 $ - $ 268,590
=========== =========== ========== =========== ===========
Shares 23,872 4,584
NAV $ 9.51 $ 9.06
Shares - Fund Class 23,872
NAV - Fund Class $ 9.51
$ 227,041
===========
Shares- Trust Class 4,584
NAV- Trust Class $ 9.06
$ 41,549
===========
(a) As a result of the proposed reorganization, investments in unaffiliated issuers and non-controlled affiliated
issuers, liabilities net of assets at Portfolio (if any) and Payables for collateral on securities loaned are being
transferred from the Portfolio to the Fund.
(b) If the proposed reorganization had occurred at October 31, 1999, deferred organization costs, if any, would have
been borne by the administrator; however, these costs are expected to be fully amortized before the date of the
reorganization.
<PAGE>
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES
(UNAUDITED) (000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS)
PERIOD ENDED OCTOBER 31, 1999
PRO FORMA
AS REPORTED (UNAUDITED)
--------------------------------- -----------
LIMITED MATURITY
INCOME FUND INCOME TRUST SUBTOTAL ADJUSTMENTS BOND FUND
<S> <C> <C> <C> <C> <C>
FUND
INVESTMENT INCOME
Investment income from Portfolio $ 17,357 $ 3,685 $ 21,042 $ (21,042)(c) $ -
Interest income - - - 21,042 21,042
--------- ---------- --------- ----------- -----------
Total Income 17,357 3,685 21,042 - 21,042
--------- ---------- --------- ----------- -----------
EXPENSES
Administration fee 703 277 980 - 980
Investment management fee - - - 792 (d) 792
Accounting fees - - - 10 (d) 10
Amortization of deferred
organization costs - - - - -
Audit 4 1 5 23 (d) 28
Custodian 10 10 20 127 (d) 147
Insurance expense - - - 4 (d) 4
Rembursement of expenses previously
assumed by administrator - - - - -
Legal 16 22 38 16 (d) 54
Registration & filing fees 29 40 69 - 69
Shareholder reports 49 70 119 - 119
Transfer agent 224 20 244 - 244
Trustees 16 3 19 20 (d) 39
Miscellaneous 14 2 16 - (d) 16
Portfolio expenses 818 174 992 (992)(d) -
--------- ---------- --------- ----------- -----------
GROSS 1,883 619 2,502 - 2,502
Reductions (58) (175) (233) - (233)
--------- ---------- --------- ----------- -----------
NET 1,825 444 2,269 - 2,269
--------- ---------- --------- ----------- -----------
NET INVESTMENT INCOME (LOSS) 15,532 3,241 18,773 - 18,773
--------- ---------- --------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS FROM CORRESPONDING PORTFOLIO
Net realized gain/loss on
investment securities (3,322) (710) (4,032) 4,032 (e) -
Change in net unrealized appreciation
/depreciation on investments (6,966) (1,534) (8,500) 8,500 (e) -
--------- ---------- --------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain/loss on
investment securities - - (4,032) (e) (4,032)
Change in net unrealized appreciation
/depreciation on investments - - (8,500) (e) (8,500)
--------- ---------- --------- ----------- -----------
Net gain (loss) on investments (10,288) (2,244) (12,532) - (12,532)
--------- ---------- --------- ----------- -----------
NET INCREASE (DECREASE) IN
NET ASSETS RESULTING FROM
OPERATIONS $ 5,244 997 6,241 - 6,241
(c) Income shown in the Pro Forma column reflects amounts received directly from unaffiliated issuers or non-controlled
affiliated issuers that were received by the Portfolio.
(d) Expenses allocated from the Portfolio. Expenses are expected to be reduced as a result of the reorganization;
however, the Company is unable to estimate the reduction.
(e) Realized and unrealized gains (losses) on investments from the Portfolio would be recognized by the Fund directly.
</TABLE>
<PAGE>
NEUBERGER BERMAN EQUITY FUNDS
FORM N-14
PART C
OTHER INFORMATION
Item 15. Indemnification.
-------- ----------------
A Delaware business trust may provide in its governing instrument for
indemnification of its officers and trustees from and against any and all claims
and demands whatsoever. Article IX, Section 2 of the Trust Instrument provides
that the Registrant shall indemnify any present or former trustee, officer,
employee or agent of the Registrant ("Covered Person") to the fullest extent
permitted by law against liability and all expenses reasonably incurred or paid
by him or her in connection with any claim, action, suit or proceeding
("Action") in which he or she becomes involved as a party or otherwise by virtue
of his or her being or having been a Covered Person and against amounts paid or
incurred by him or her in settlement thereof. Indemnification will not be
provided to a person adjudged by a court or other body to be liable to the
Registrant or its shareholders by reason of "willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
his office" ("Disabling Conduct"), or not to have acted in good faith in the
reasonable belief that his or her action was in the best interest of the
Registrant. In the event of a settlement, no indemnification may be provided
unless there has been a determination that the officer or trustee did not engage
in Disabling Conduct (i) by the court or other body approving the settlement;
(ii) by at least a majority of those trustees who are neither interested
persons, as that term is defined in the Investment Company Act of 1940 ("1940
Act"), of the Registrant ("Independent Trustees"), nor parties to the matter
based upon a review of readily available facts; or (iii) by written opinion of
independent legal counsel based upon a review of readily available facts.
Pursuant to Article IX, Section 3 of the Trust Instrument, if any
present or former shareholder of any series ("Series") of the Registrant shall
be held personally liable solely by reason of his or her being or having been a
shareholder and not because of his or her acts or omissions or for some other
reason, the present or former shareholder (or his or her heirs, executors,
administrators or other legal representatives or in the case of any entity, its
general successor) shall be entitled out of the assets belonging to the
applicable Series to be held harmless from and indemnified against all loss and
expense arising from such liability. The Registrant, on behalf of the affected
Series, shall, upon request by such shareholder, assume the defense of any claim
made against such shareholder for any act or obligation of the Series and
satisfy any judgment thereon from the assets of the Series.
Section 9 of the Management Agreements between Neuberger Berman
Management Inc. ("NB Management") and Equity Managers Trust and Global Managers
Trust (Equity Managers Trust and Global Managers Trust are collectively referred
to as the "Managers Trusts") provide that neither NB Management nor any
director, officer or employee of NB Management performing services for the
series of the Managers Trusts at the direction or request of NB Management in
connection with NB Management's discharge of its obligations under the
Agreements shall be liable for any error of judgment or mistake of law or for
any loss suffered by a series in connection with any matter to which the
Agreements relates; provided, that nothing in the Agreements shall be construed
(i) to protect NB Management against any liability to the Managers Trusts or any
series thereof or their interest holders to which NB Management would otherwise
be subject by reason of willful misfeasance, bad faith, or gross negligence in
the performance of its duties, or by reason of NB Management's reckless
disregard of its obligations and duties under the Agreements, or (ii) to protect
any director, officer or employee of NB Management who is or was a trustee or
officer of the Managers Trusts against any liability to the Managers Trusts or
any series thereof or its interest holders to which such person would otherwise
be subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of such person's office
with Managers Trusts.
Section 1 of the Sub-Advisory Agreements between NB Management and
Neuberger Berman, LLC ("Neuberger Berman") with respect to the Managers Trusts
provides that, in the absence of willful misfeasance, bad faith or gross
negligence in the performance of its duties or of reckless disregard of its
<PAGE>
duties and obligations under the Agreement, Neuberger Berman will not be subject
to any liability for any act or omission or any loss suffered by any series of
the Managers Trusts or their interest holders in connection with the matters to
which the Agreements relate.
Section 12 of the Administration Agreement between the Registrant and
NB Management provides that NB Management will not be liable to the Registrant
for any action taken or omitted to be taken by NB Management or its employees,
agents or contractors in carrying out the provisions of the Agreement if such
action was taken or omitted in good faith and without negligence or misconduct
on the part of NB Management, or its employees, agents or contractors. Section
13 of the Administration Agreement provides that the Registrant shall indemnify
NB Management and hold it harmless from and against any and all losses, damages
and expenses, including reasonable attorneys' fees and expenses, incurred by NB
Management that result from: (i) any claim, action, suit or proceeding in
connection with NB Management's entry into or performance of the Agreement; or
(ii) any action taken or omission to act committed by NB Management in the
performance of its obligations under the Agreement; or (iii) any action of NB
Management upon instructions believed in good faith by it to have been executed
by a duly authorized officer or representative of a Series; provided, that NB
Management will not be entitled to such indemnification in respect of actions or
omissions constituting negligence or misconduct on the part of NB Management, or
its employees, agents or contractors. Amounts payable by the Registrant under
this provision shall be payable solely out of assets belonging to that Series,
and not from assets belonging to any other Series of the Registrant. Section 14
of the Administration Agreement provides that NB Management will indemnify the
Registrant and hold it harmless from and against any and all losses, damages and
expenses, including reasonable attorneys' fees and expenses, incurred by the
Registrant that result from: (i) NB Management's failure to comply with the
terms of the Agreement; or (ii) NB Management's lack of good faith in performing
its obligations under the Agreement; or (iii) the negligence or misconduct of NB
Management, or its employees, agents or contractors in connection with the
Agreement. The Registrant shall not be entitled to such indemnification in
respect of actions or omissions constituting negligence or misconduct on the
part of the Registrant or its employees, agents or contractors other than NB
Management, unless such negligence or misconduct results from or is accompanied
by negligence or misconduct on the part of NB Management, any affiliated person
of NB Management, or any affiliated person of an affiliated person of NB
Management.
Section 11 of the Distribution Agreement between the Registrant and NB
Management provides that NB Management shall look only to the assets of a Series
for the Registrant's performance of the Agreement by the Registrant on behalf of
such Series, and neither the Trustees nor any of the Registrant's officers,
employees or agents, whether past, present or future, shall be personally liable
therefor.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 ("1933 Act") may be permitted to trustees, officers and
controlling persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission, such indemnification is against public policy as
expressed in the 1933 Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a trustee, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such trustee, officer or controlling person, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the 1933 Act and will be governed by the final adjudication of such
issue.
Item 16. Exhibits.
-------- ---------
Exhibit
Number Description
------ -----------
(1) (a) Certificate of Trust. Incorporated by Reference to
Post-Effective Amendment No. 70 to Registrant's Registration
Statement, File Nos. 2-11357 and 811-582.
(b) Restated Certificate of Trust. Incorporated by Reference to
Post-Effective Amendment No. 82 to Registrant's Registration
Statement, File Nos. 2-11357 and 811-582.
2
<PAGE>
Exhibit
Number Description
------ -----------
(c) Trust Instrument of Neuberger Berman Equity Funds.
Incorporated by Reference to Post-Effective Amendment No. 70 to
Registrant's Registration Statement, File Nos. 2-11357 and
811-582.
(d) Schedule A - Current Series of Neuberger Berman Equity Funds.
To Be Filed by Amendment.
(2) By-laws of Neuberger Berman Equity Funds. Incorporated by
Reference to Post-Effective Amendment No. 70 to Registrant's
Registration Statement, File Nos. 2-11357 and 811-582.
(3) Voting Trust Agreement. Not Applicable.
(4) Plan of Reorganization. Incorporated by Reference from
Registrant's Registration Statement on Form N-14, File Nos.
2-11357 and 811-582 (Filed June 26, 2000).
(5) (a) Trust Instrument of Neuberger Berman Equity Funds, Articles IV,
V, and VI. Incorporated by Reference to Post-Effective
Amendment No. 70 to Registrant's Registration Statement, File
Nos. 2-11357 and 811-582.
(b) By-Laws of Neuberger Berman Equity Funds, Articles V, VI, and
VIII. Incorporated by Reference to Post-Effective Amendment
No. 70 to Registrant's Registration Statement, File Nos.
2-11357 and 811-582.
(6) (a) (i) Management Agreement Between Equity Managers Trust and
Neuberger Berman Management Inc. Incorporated by
Reference to Post-Effective Amendment No. 87 to
Registrant's Registration Statement, File Nos. 2-11357
and 811-582.
(ii) Schedule A - Series of Equity Managers Trust Currently
Subject to the Management Agreement. To Be Filed by
Amendment.
(iii) Schedule B - Schedule of Compensation Under the
Management Agreement. Incorporated by Reference to
Post-Effective Amendment No. 87 to Registrant's
Registration Statement, File Nos. 2-11357 and 811-582.
(b) (i) Sub-Advisory Agreement Between Neuberger Berman
Management Inc. and Neuberger Berman, LLC with Respect
to Equity Managers Trust. Incorporated by Reference to
Post-Effective Amendment No. 70 to Registrant's
Registration Statement, File Nos. 2-11357 and 811-582.
(ii) Schedule A - Series of Equity Managers Trust Currently
Subject to the Sub-Advisory Agreement. To Be Filed by
Amendment.
(c) (i) Management Agreement Between Global Managers Trust and
Neuberger Berman Management Inc.. Incorporated by
Reference to Post-Effective Amendment No. 74 to
Registrant's Registration Statement, File Nos. 2-11357
and 811-582.
3
<PAGE>
Exhibit
Number Description
------ -----------
(ii) Schedule A - Series of Global Managers Trust Currently
Subject to the Management Agreement. Incorporated by
Reference to Post-Effective Amendment No. 74 to
Registrant's Registration Statement, File Nos. 2-11357
and 811-582.
(iii) Schedule B - Schedule of Compensation Under the
Management Agreement. Incorporated by Reference to
Post-Effective Amendment No. 74 to Registrant's
Registration Statement, File Nos. 2-11357 and 811-582.
(d) (i) Sub-Advisory Agreement Between Neuberger Berman
Management Inc. and Neuberger Berman, LLC with Respect
to Global Managers Trust. Incorporated by Reference to
Post-Effective Amendment No. 74 to Registrant's
Registration Statement, File Nos. 2-11357 and 811-582.
(ii) Schedule A - Series of Global Managers Trust Currently
Subject to the Sub-Advisory Agreement. Incorporated by
Reference to Post-Effective Amendment No. 74 to
Registrant's Registration Statement, File Nos. 2-11357
and 811-582.
(7) (a) Distribution Agreement Between Neuberger Berman Equity Funds
and Neuberger Berman Management Inc. Incorporated by Reference
to Post-Effective Amendment No. 87 to Registrant's Registration
Statement, File Nos. 2-11357 and 811-582.
(b) Schedule A - Series of Neuberger Berman Equity Funds Currently
Subject to the Distribution Agreement. Incorporated by
Reference to Post-Effective Amendment No. 87 to Registrant's
Registration Statement, File Nos. 2-11357 and 811-582.
(8) Bonus, Profit Sharing or Pension Plans. None.
(9) (a) Custodian Contract Between Neuberger Berman Equity Funds and
State Street Bank and Trust Company. Incorporated by Reference
to Post-Effective Amendment No. 74 to Registrant's Registration
Statement, File Nos. 2-11357 and 811-582.
(b) Schedule of Compensation under the Custodian Contract.
Incorporated by Reference to Post-Effective Amendment No. 76 to
Registrant's Registration Statement, File Nos. 2-11357 and
811-582.
(10) Plan Pursuant to Rule 12b-1. None.
(11) Consent of Kirkpatrick & Lockhart LLP on Securities Matters with
Respect to Neuberger Berman Equity Funds. Filed Herewith.
(12) Opinion of Counsel Supporting Tax Matters. To Be Filed by
Amendment.
(13) (a) (i) Transfer Agency and Service Agreement Between Neuberger
Berman Equity Funds and State Street Bank and Trust
Company. Incorporated by Reference to Post-Effective
Amendment No. 70 to Registrant's Registration Statement,
File Nos. 2-11357 and 811-582.
4
<PAGE>
Exhibit
Number Description
------ -----------
(ii) First Amendment to Transfer Agency and Service Agreement
Between Neuberger Berman Equity Funds and State Street
Bank and Trust Company. Incorporated by Reference to
Post-Effective Amendment No. 70 to Registrant's
Registration Statement, File Nos. 2-11357 and 811-582.
(iii) Second Amendment to Transfer Agency and Service
Agreement between Neuberger Berman Equity Funds and
State Street Bank and Trust Company. Incorporated by
Reference to Post-Effective Amendment No. 77 to
Registrant's Registration Statement, File Nos. 2-11357
and 811-582.
(iv) Schedule of Compensation under the Transfer Agency and
Service Agreement. Incorporated by Reference to
Post-Effective Amendment No. 76 to Registrant's
Registration Statement, File Nos. 2-11357 and 811-582.
(b) (i) Administration Agreement Between Neuberger Berman Equity
Funds and Neuberger Berman Management Inc. Incorporated
by Reference to Post-Effective Amendment No. 87 to
Registrant's Registration Statement, File Nos. 2-11357
and 811-582.
(ii) Schedule A - Series of Neuberger Berman Equity Funds
Currently Subject to the Administration Agreement. To Be
Filed by Amendment.
(iii) Schedule B - Schedule of Compensation Under the
Administration Agreement. Incorporated by Reference to
Post-Effective Amendment No. 87 to Registrant's
Registration Statement, File Nos. 2-11357 and 811-582.
(14) Consent of Independent Auditors. Filed Herewith.
(15) Financial Statements Omitted from Prospectus. None.
(16) Power of Attorney. Incorporated by Reference to Registrant's
Registration Statement on Form N-14, File Nos. 2-11357 and
811-582 (Filed June 26, 2000).
(17) Additional Exhibits. None.
<PAGE>
Item 17. Undertakings.
----------------------
(1) The undersigned registrant agrees that prior to any public
reoffering of the securities registered through the use of a prospectus which is
a part of this registration statement by any person or party who is deemed to be
an underwriter within the meaning of Rule 145(c) of the Securities Act [17 CFR
230.145c], the reoffering prospectus will contain the information called for by
the applicable registration form for reofferings by persons who may be deemed
underwriters, in addition to the information called for by the other items of
the applicable form.
(2) The undersigned registrant agrees that every prospectus that is
filed under paragraph (1) above will be filed as a part of an amendment to the
registration statement and will not be used until the amendment is effective,
and that, in determining any liability under the 1933 Act, each post-effective
amendment shall be deemed to be a new registration statement for the securities
offered therein, and the offering of the securities at that time shall be deemed
to be the initial bona fide offering of them.
(3)The undersigned registrant agrees to file an amendment to the
registration statement, pursuant to Rule 485(b) of Regulation C of the 1933 Act,
prior to the effective date for the purpose of including Exhibit 12, Opinion of
Counsel Supporting Tax Matters.
<PAGE>
SIGNATURES
As required by the Securities Act of 1933, this registration statement has been
signed on behalf of the registrant, in the City of Washington, the District of
Columbia on the 27th day of July, 2000.
Registrant: NEUBERGER BERMAN EQUITY FUNDS
By: /s/Michael M. Kassen*
--------------------------
Michael M. Kassen
President
As required by the Securities Act of 1933, this registration statement has been
signed by the following persons in the capacities and on the date indicated.
Signature Title Date
--------- ----- ----
/s/Peter E. Sundman* Chairman of the Board July 27, 2000
--------------------- and Trustee (Chief
Peter E. Sundman Executive Officer)
/s/Michael M. Kassen* President and Trustee July 27, 2000
---------------------
Michael M. Kassen
/s/Michael J. Weiner* Vice President July 27, 2000
--------------------- (Principal Financial
Michael J. Weiner Officer)
/s/Richard Russell* Treasurer (Principal July 27, 2000
------------------- Accounting Officer)
Richard Russell
*Signature affixed by Arthur C. Delibert pursuant to powers of attorney dated
June 6, 2000.
<PAGE>
Signature Title Date
--------- ----- ----
/s/Faith Colish* Trustee July 27, 2000
---------------------------
Faith Colish
/s/Howard A. Mileaf* Trustee July 27, 2000
---------------------------
Howard A. Mileaf
/s/Edward I. O'Brien* Trustee July 27, 2000
---------------------------
Edward I. O'Brien
/s/John T. Patterson, Jr.* Trustee July 27, 2000
---------------------------
John T. Patterson, Jr.
/s/John P. Rosenthal* Trustee July 27, 2000
---------------------------
John P. Rosenthal
/s/Cornelius T. Ryan* Trustee July 27, 2000
---------------------------
Cornelius T. Ryan
/s/Gustave H. Shubert* Trustee July 27, 2000
---------------------------
Gustave H. Shubert
*Signature affixed by Arthur C. Delibert pursuant to powers of attorney dated
June 6, 2000.
<PAGE>
SIGNATURES
As required by the Securities Act of 1933, this registration statement has been
signed on behalf of the registrant, in the City of New York, and the State of
New York on the 27th day of July, 2000.
Registrant: EQUITY MANAGERS TRUST
By: /s/Michael M. Kassen*
-----------------------------
Michael M. Kassen
President
As required by the Securities Act of 1933, this registration statement has been
signed by the following persons in the capacities and on the date indicated.
Signature Title Date
--------- ----- ----
/s/Peter E. Sundman* Chairman of the Board July 27, 2000
------------------------ and Trustee (Chief
Peter E. Sundman Executive Officer)
/s/Michael M. Kassen* President and Trustee July 27, 2000
-----------------------
Michael M. Kassen
/s/Michael J. Weiner* Vice President July 27, 2000
----------------------- (Principal Financial
Michael J. Weiner Officer)
/s/Richard Russell* Treasurer (Principal July 27, 2000
----------------------- Accounting Officer)
Richard Russell
*Signature affixed by Arthur C. Delibert pursuant to powers of attorney dated
June 6, 2000.
<PAGE>
Signature Title Date
--------- ----- ----
/s/Faith Colish* Trustee July 27, 2000
---------------------------
Faith Colish
/s/Howard A. Mileaf* Trustee July 27, 2000
---------------------------
Howard A. Mileaf
/s/Edward I. O'Brien* Trustee July 27, 2000
---------------------------
Edward I. O'Brien
/s/John T. Patterson, Jr.* Trustee July 27, 2000
---------------------------
John T. Patterson, Jr.
/s/John P. Rosenthal* Trustee July 27, 2000
---------------------------
John P. Rosenthal
/s/Cornelius T. Ryan* Trustee July 27, 2000
---------------------------
Cornelius T. Ryan
/s/Gustave H. Shubert* Trustee July 27, 2000
---------------------------
Gustave H. Shubert
*Signature affixed by Arthur C. Delibert pursuant to powers of attorney dated
June 6, 2000.
