<PAGE>
<PAGE>
SEMI-ANNUAL REPORT
- -------------------------------------------
April 30, 1996
NEUBERGER&BERMAN
INCOME TRUST -Registered Service Mark-
Neuberger&Berman
ULTRA SHORT BOND TRUST
Neuberger&Berman
LIMITED MATURITY BOND TRUST
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
THE TRUSTS
PRESIDENT'S LETTER 4
PERFORMANCE
HIGHLIGHTS 8
FINANCIAL STATEMENTS 9
FINANCIAL HIGHLIGHTS
PER SHARE DATA
Ultra Short Bond Trust 15
Limited Maturity Bond
Trust 16
THE PORTFOLIOS
SCHEDULE OF
INVESTMENTS
Ultra Short Bond
Portfolio 18
Limited Maturity Bond
Portfolio 22
FINANCIAL STATEMENTS 28
FINANCIAL HIGHLIGHTS 35
DIRECTORY 36
OFFICERS AND
TRUSTEES 37
</TABLE>
3
<PAGE>
PRESIDENT'S LETTER June 17, 1996
Dear Shareholder,
When we last reported to you, in your Fund's October 1995 Annual Report,
interest rates were falling and the bond market was in the midst of one of its
strongest rallies in over a decade. The economic environment remained relatively
subdued through the end of 1995, and prices of corporate, government, and
municipal bonds continued to increase.
Early in the first quarter of 1996, however, this positive trend for bonds
began to reverse itself due to a steady flow of positive economic data. The
economy, as measured by real gross domestic product (real GDP is the total
output of goods and services in the U.S., adjusted for inflation), grew at an
annualized rate of 2.8% through the first quarter, which was much higher than
expected. In addition, a February jobs report showed stronger-than-expected
growth in non-agricultural jobs, causing the biggest one-day rise in long-term
interest rates since the Gulf War in August of 1990.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
DESCRIPTION: GRAPH DEPICTING RELATIVE YIELDS OF THE 30 YEAR TREASURY BOND,
TREASURY BILLS AND MERRILL LYNCH 12-22 YEAR MUNICIPAL BOND INDEX FOR THE TIME
PERIOD NOV. 1, 1995 - APRIL 30, 1996
<TABLE>
<CAPTION>
THREE-MONTH
TREASURY
TREASURY BONDS BILLS MUNICIPAL BONDS
<S> <C> <C> <C>
11/1 6.30 5.46 5.50
11/2 6.24 5.39 5.43
11/3 6.28 5.42 5.44
11/6 6.29 5.47 5.42
11/7 6.31 5.50 5.42
11/8 6.25 5.43 5.35
11/9 6.28 5.44 5.36
11/10 6.34 5.50 5.39
11/13 6.28 5.46 5.37
11/14 6.29 5.45 5.40
11/15 6.29 5.50 5.42
11/16 6.22 5.45 5.35
11/17 6.23 5.43 5.34
11/20 6.25 5.44 5.37
11/21 6.27 5.47 5.36
11/22 6.28 5.49 5.37
11/23 6.28 5.48
11/24 6.25 5.47 5.34
11/27 6.22 5.46 5.33
11/28 6.23 5.48 5.33
11/29 6.20 5.40 5.30
11/30 6.13 5.38 5.24
12/1 6.09 5.37 5.21
12/4 6.03 5.37 5.17
12/5 6.05 5.37 5.21
12/6 6.03 5.37 5.22
12/7 6.08 5.40 5.17
12/8 6.05 5.43 5.18
12/11 6.05 5.41 5.17
12/12 6.05 5.42 5.23
12/13 6.08 5.43 5.23
12/14 6.09 5.40 5.30
12/15 6.10 5.36 5.31
12/18 6.20 5.35 5.37
12/19 6.11 5.23 5.31
12/20 6.12 5.15 5.31
12/21 6.09 5.03 5.34
12/22 6.06 5.03 5.30
12/25 6.07 5.02
12/26 6.04 5.00 5.29
12/27 6.01 5.03 5.27
12/28 5.98 4.98 5.24
12/29 5.95 5.08 5.21
12/31 5.21
1/1 5.95 5.08
1/2 5.96 5.12 5.26
1/3 5.96 5.21 5.24
1/4 6.03 5.19 5.30
1/5 6.05 5.18 5.26
1/8 6.04 5.17 5.24
1/9 6.11 5.15 5.24
1/10 6.18 5.17 5.32
1/11 6.15 5.17 5.30
1/12 6.15 5.17 5.30
1/15 6.15 5.17 5.29
1/16 6.06 5.14 5.23
1/17 6.01 5.13 5.19
1/18 5.99 5.11 5.15
1/19 5.97 5.11 5.15
1/22 6.04 5.13 5.22
1/23 6.09 5.12 5.22
1/24 6.04 5.11 5.17
1/25 6.11 5.13 5.24
1/26 6.04 5.10 5.05
1/29 6.09 5.15 5.10
1/30 6.04 5.12 5.04
1/31 6.03 5.05 4.99
2/1 6.07 5.00 4.97
2/2 6.16 4.98 5.01
2/5 6.16 5.00 5.00
2/6 6.13 4.99 4.99
2/7 6.16 4.93 4.99
2/8 6.15 4.91 4.93
2/9 6.10 4.93 4.92
2/12 6.03 4.93 4.88
2/13 6.03 4.92 4.84
2/14 6.09 4.93 4.85
2/15 6.17 4.90 4.89
2/16 6.24 4.89 4.93
2/19 6.24 4.89
2/20 6.40 4.96 5.06
2/21 6.37 4.96 5.04
2/22 6.34 4.94 5.01
2/23 6.41 4.95 5.04
2/26 6.46 4.98 5.07
2/27 6.48 5.02 5.10
2/28 6.47 5.01 5.12
2/29 6.47 5.03 5.12
3/1 6.37 5.00 5.12
3/4 6.33 5.03 5.08
3/5 6.38 5.03 5.11
3/6 6.45 5.03 5.14
3/7 6.46 5.03 5.15
3/8 6.71 5.03 5.37
3/11 6.64 5.10 5.38
3/12 6.67 5.10 5.41
3/13 6.68 5.12 5.40
3/14 6.69 5.12 5.40
3/15 6.74 5.15 5.49
3/18 6.71 5.18 5.47
3/19 6.72 5.21 5.49
3/20 6.64 5.14 5.43
3/21 6.62 5.06 5.42
3/22 6.66 5.11 5.44
3/25 6.58 5.07 5.37
3/26 6.58 5.15 5.36
3/27 6.68 5.16 5.41
3/28 6.72 5.19 5.41
3/29 6.67 5.14 5.36
3/31 5.36
4/1 6.63 5.16 5.21
4/2 6.60 5.17 5.21
4/3 6.63 5.15 5.21
4/4 6.67 5.12 5.21
4/5 6.82 5.16 5.21
4/8 6.87 5.16 5.50
4/9 6.83 5.09 5.47
4/10 6.95 5.09 5.48
4/11 6.94 5.10 5.49
4/12 6.80 5.08 5.49
4/15 6.79 5.00 5.37
4/16 6.79 4.97 5.35
4/17 6.81 4.96 5.35
4/18 6.83 5.00 5.35
4/19 6.79 5.03 5.36
4/22 6.75 5.00 5.32
4/23 6.78 5.11 5.33
4/24 6.82 5.14 5.33
4/25 6.80 5.10 5.35
4/26 6.79 5.12 5.31
4/29 6.84 5.16 5.34
4/30 6.91 5.15 5.37
</TABLE>
SOURCE: BLOOMBERG FINANCIAL MARKETS -- 30 YEAR TREASURY BOND & TREASURY BILLS
MERRILL LYNCH 12-22 YEAR MUNICIPAL BOND INDEX
Other factors that contributed to the strength in the economy during the first
quarter were signs of increasing capital and government spending, including
higher personal-consumption and business-related purchases. Department store
sales and retailing stocks recovered from
4
<PAGE>
their late 1995 doldrums, auto sales rose, factory orders surged after a short
dip in February, requests for unemployment benefits dropped, and Americans
increased their borrowing pace. The economy remained strong despite the January
blizzards, a government shutdown, and a widespread strike by General Motors
employees.
In response to the mounting evidence that the economy was more robust than
expected, the yield on the long bond (the benchmark 30-year Treasury) jumped
from under 6% in January to nearly 7% by the end of April. As a result, the
total return of 30-year bonds through April 30, 1996 registered a 10.5%
decline.* Municipal bond returns declined less dramatically, as moderate new
issuance and rejuvenated confidence in municipal bonds' credit quality (since
the Orange County default of 1994) bolstered their standing in the overall bond
market. Mortgage-backed securities also lost value, but they were buoyed
slightly by reduced prepayment fears (home loan refinancing slows as interest
rates rise). Foreign bond markets performed only marginally better than the
domestic bond market, as the strengthening dollar and the condition of U.S.
bonds stifled their performance; high-yielding markets such as Australia, Italy,
and Sweden fared best while low-yielding foreign markets such as Japan, Germany,
and the U.K. did worse.
Shortly after the Semi-Annual Report period ended, lower bond prices and
temporarily diminished inflationary concerns incited a May rally in the bond
market. Although the recent volatility in the bond market may not inspire an
investor's desire to take on extra risk, we feel it's also not a time of
complete gloom and doom. We also believe these are times when fixed-income fund
investors should feel comfortable about their investments, whether rates exceed
7% this year or return to 1995 yield levels. So we are especially pleased to
report that your Neuberger&Berman Income Funds posted positive returns over the
six-month period ended April 30, 1996 and were proactively managed, especially
against the backdrop of rising interest rates.
We strive to merit your continued confidence and remain committed to providing
consistent performance in all market conditions. A discussion of each
Portfolio's strategy over the six-month period of the Semi-Annual Report
follows.
*SOURCE: SALOMON 30-YEAR TREASURY INDEX.
5
<PAGE>
ULTRA SHORT BOND TRUST. At the start of the Semi-Annual Report period, bond
market expectations were so strong that two-year Treasury Notes yielded slightly
less than the overnight Fed Funds rate (the overnight lending rate charged by
banks with excess reserves to those that need loans to meet reserve
requirements; it is the most sensitive indicator of the direction of interest
rates, since it is set daily by the market). This represented an "inverted"
(also called "negative") yield curve, where investors found higher yields in
shorter-term bonds. But as inflation fears crept in during February, the
direction of interest rates changed and the shape of the yield curve changed to
"positive" (the usual curve, where shorter-term bonds have lower yields than
longer-term bonds of the same quality). Yields increased by more than 50 basis
points in two- and three-year Treasuries as the Semi-Annual Report period
progressed into spring. At the same time, short-term money market rates dropped
by more than 30 basis points as investors began to absorb the supply of shorter
maturities in an attempt to protect their principal.
We began the Semi-Annual Report period optimistically, extending our portfolio
duration as interest rates were trending lower (duration is a measure of the
Portfolio's price sensitivity to a change in interest rates). However, we
rapidly changed that direction as the bond market deteriorated and rates rose in
the first quarter of 1996. We enhanced the Portfolio's yield by diversifying
into different sectors of the bond market that offered higher yields than
Treasuries. Our analysis encouraged us to maintain most of our corporate bond
exposure and increase our positions in corporate money market securities. We
maintained our exposure to asset-backed securities (bonds backed by loans or
accounts receivable originated by banks, credit card companies, or other
providers of credit) and commercial paper which were offering higher yields than
Treasuries with similar durations. Our selection of agency mortgage-backed
securities added significant incremental yield to the Portfolio as earlier fears
of rapid home mortgage refinancing offered us
an opportunity to invest in a sector that, in our judgment, was undervalued.
LIMITED MATURITY BOND TRUST. The yields on two-year Treasuries opened 1996
at 5.15% and closed at 6.05% by the end of April. Similarly, 30-year Treasury
rates increased 96 basis points to 6.91%, and pushed through 7.00% shortly
thereafter.
6
<PAGE>
Our response to the reversal of fortune in the bond market was consistent with
our trend-following duration management approach. We became more cautious as our
trend models turned negative, and reduced the Portfolio's duration (duration is
a measure of the Portfolio's exposure to interest rate risk) from 3.0 years to
approximately 2.5 years during February.
During the six-month period ended April 30, 1996, we added to the Portfolio's
corporate bond allocation as a significant new supply of corporate debt allowed
us to purchase 5-year bonds -- mainly of financial institutions -- at what we
felt were attractive prices. In addition, we added bonds of a few companies
rated just below investment grade (below BBB according to Standard & Poor's or
Baa by Moody's Investors Services Inc.) at significant yield premiums above
Treasuries. We only invested in companies we believed were fundamentally sound;
these companies included Federated Department Stores, a leading operator of
department stores, and Riverwood International, a specialty paper producer that
we considered well-positioned. Corporate bonds accounted for about 61.8% of the
Portfolio at the end of April. We also began to add to our mortgage-backed bond
position, for these securities were selling at what we believed to be attractive
prices.
Sincerely,
/s/ Theresa A. Havell
Theresa A. Havell
President and Trustee
Neuberger&Berman Income Trust
7
<PAGE>
PERFORMANCE HIGHLIGHTS
<TABLE>
<CAPTION>
TOTAL RETURN ILLUSTRATION
SIX AVERAGE ANNUAL TOTAL
MONTH RETURNS(1)
PERIOD -------------------------
NEUBERGER&BERMAN INCEPTION ENDED SINCE
INCOME TRUST DATE* 4/30/96 1 YR(1) 5 YR INCEPTION
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ULTRA SHORT BOND TRUST** 11/7/86 +2.00% +5.23% +4.32% +5.80%
LIMITED MATURITY BOND TRUST** 6/9/86 +1.44% +6.17% +6.04% +6.94%
</TABLE>
1)One year and average annual total returns are for periods ended April 30,
1996. Includes reinvestment of all dividends and capital gain distributions.
Results represent past performance and do not guarantee future results.
Investment returns and principal may fluctuate and shares when redeemed may
be worth more or less than original cost.
* Ultra Short Bond Trust and Limited Maturity Bond Trust started operating on
September 7, 1993 and August 30, 1993, respectively. The Funds have identical
investment objectives and policies, and invest in the same Portfolios as
other funds ("Sister Funds") which are also administered by Neuberger& Berman
Management Inc. The performance information and inception dates for the Funds
prior to their commencement of operations is for the Sister Funds and their
predecessors.
** Neuberger&Berman Management Inc. voluntarily bears certain operating expenses
in excess of .75% of the average daily net assets per annum of Ultra Short
Bond Trust (.65% prior to March 1, 1995) and .80% of the average daily net
assets per annum of Limited Maturity Bond Trust (.70% prior to March 1,
1995). These arrangements can be terminated upon 60 days' prior written
notice to the appropriate Fund. Absent such reimbursements, the total returns
would have been less.
8
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
Neuberger&Berman April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Trust
<TABLE>
<CAPTION>
LIMITED
ULTRA SHORT MATURITY
(000'S OMITTED EXCEPT PER SHARE AMOUNTS) BOND TRUST BOND TRUST
-----------------------------
<S> <C> <C>
ASSETS
Investment in corresponding Portfolio, at
value (Note A) $5,874 $14,167
Deferred organization costs (Note A) 26 25
Receivable for Trust shares sold -- 23
Receivable from administrator -- net (Note
B) 21 12
-----------------------------
5,921 14,227
-----------------------------
LIABILITIES
Dividends payable -- 1
Payable for Trust shares redeemed 3 13
Accrued expenses 39 44
-----------------------------
42 58
-----------------------------
NET ASSETS at value $5,879 $14,169
-----------------------------
NET ASSETS consist of:
Par value $ 1 $ 1
Paid-in capital in excess of par value 5,935 14,311
Accumulated undistributed foreign currency
gains -- 3
Accumulated net realized gains (losses) on
investment (24) 28
Net unrealized depreciation in value of
investment (33) (174)
-----------------------------
NET ASSETS at value $5,879 $14,169
-----------------------------
SHARES OUTSTANDING
($.001 par value; unlimited shares
authorized) 601 1,497
-----------------------------
NET ASSET VALUE, offering and redemption price per
share $9.78 $9.47
-----------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
9
<PAGE>
STATEMENTS OF OPERATIONS
Neuberger&Berman For the Six Months Ended April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Trust
<TABLE>
<CAPTION>
LIMITED
ULTRA SHORT MATURITY
(000'S OMITTED) BOND TRUST BOND TRUST
-------------------------
<S> <C> <C>
INVESTMENT INCOME
Investment income from corresponding Portfolio
(Note A) $ 180 $ 432
-------------------------
Expenses:
Administration fee (Note B) 14 32
Amortization of deferred organization and
initial offering expenses (Note A) 5 5
Auditing fees 3 2
Custodian fees 5 5
Legal fees 15 14
Registration and filing fees 17 21
Shareholder reports 22 28
Shareholder servicing agent fees 9 11
Trustees' fees and expenses 1 1
Miscellaneous 1 1
Expenses from corresponding Portfolio (Note
A) 12 21
-------------------------
Total expenses 104 141
Deduct -- expenses reimbursed by
administrator (Note B) (81) (89)
-------------------------
Total net expenses 23 52
-------------------------
Net investment income 157 380
-------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS, FINANCIAL FUTURES CONTRACTS, AND
FOREIGN CURRENCY TRANSACTIONS FROM CORRESPONDING
PORTFOLIO (NOTE A)
Net realized gain (loss) on investments (16) 68
Net realized loss on foreign currency
transactions -- (3)
Change in net unrealized appreciation
(depreciation) of investments and
translation of assets and liabilities in
foreign currencies (36) (303)
Net unrealized appreciation of financial
futures contracts -- 22
-------------------------
Net loss on investments, financial futures
contracts, and foreign currency
transactions from corresponding
Portfolio (Note A) (52) (216)
-------------------------
Net increase in net assets resulting from
operations $ 105 $ 164
-------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
10
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
Neuberger&Berman
- ----------------------------------------------------------------------
Income Trust
<TABLE>
<CAPTION>
ULTRA SHORT LIMITED MATURITY
BOND TRUST BOND TRUST
Six Months Six Months
Ended Year Ended Year
April 30, Ended April 30, Ended
1996 October 31, 1996 October 31,
(000'S OMITTED) (UNAUDITED) 1995 (UNAUDITED) 1995
-----------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 157 $ 81 $ 380 $ 537
Net realized gain (loss) on
investments, financial futures
contracts, and foreign currency
transactions from corresponding
Portfolio (Note A) (16) (1) 65 (13)
Change in net unrealized
appreciation (depreciation) of
investments, financial futures
contracts, and translation of
assets and liabilities in foreign
currencies from corresponding
Portfolio (Note A) (36) 9 (281) 181
-----------------------------------------------------
Net increase in net assets resulting
from operations 105 89 164 705
-----------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (157) (81) (380) (537)
-----------------------------------------------------
FROM TRUST SHARE TRANSACTIONS:
Proceeds from shares sold 6,561 1,795 6,455 6,602
Proceeds from reinvestment of
dividends 157 80 373 530
Payments for shares redeemed (2,527) (1,379) (4,358) (2,093)
-----------------------------------------------------
Net increase from Trust share
transactions 4,191 496 2,470 5,039
-----------------------------------------------------
NET INCREASE IN NET ASSETS 4,139 504 2,254 5,207
NET ASSETS:
Beginning of period 1,740 1,236 11,915 6,708
-----------------------------------------------------
End of period $ 5,879 $ 1,740 $14,169 $11,915
-----------------------------------------------------
Accumulated undistributed foreign
currency gains $ -- $ -- $ 3 $ 3
-----------------------------------------------------
NUMBER OF TRUST SHARES:
Sold 665 182 674 694
Issued on reinvestment of dividends 16 8 39 56
Redeemed (257) (140) (456) (220)
-----------------------------------------------------
Net increase in shares outstanding 424 50 257 530
-----------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
11
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Neuberger&Berman April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Trust
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
1) GENERAL: Neuberger&Berman Ultra Short Bond Trust ("Ultra Short") and
Neuberger&Berman Limited Maturity Bond Trust ("Limited Maturity")
(collectively, the "Funds") are separate operating series of Neuberger&Berman
Income Trust (the "Trust"), a Delaware business trust organized pursuant to a
Trust Instrument dated May 6, 1993. The Trust is registered as a diversified,
open-end management investment company under the Investment Company Act of
1940, as amended, and its shares are registered under the Securities Act of
1933, as amended. The trustees of the Trust may establish additional series
or classes of shares without the approval of shareholders.
The assets of each series belong only to that series, and the liabilities
of each series are borne solely by that series and no other.
Each Fund seeks to achieve its investment objective by investing all of
its net investable assets in its corresponding Portfolio of Income Managers
Trust (the "Portfolio") having the same investment objective and policies as
the Fund. The value of each Fund's investment in its corresponding Portfolio
reflects that Fund's proportionate interest in the net assets of that
Portfolio (5.77% and 4.61% for Ultra Short and Limited Maturity,
respectively, at April 30, 1996). The performance of each Fund is directly
affected by the performance of its corresponding Portfolio. The financial
statements of each Portfolio, including the schedule of investments, are
included elsewhere in this report and should be read in conjunction with each
Fund's financial statements.
2) PORTFOLIO VALUATION: Each Fund records its investment in its corresponding
Portfolio at value. Investment securities held by each Portfolio of Income
Managers Trust are valued by Income Managers Trust as indicated in the notes
following the Portfolios' schedule of investments.
3) FEDERAL INCOME TAXES: Each series of the Trust is treated as a separate
entity for Federal income tax purposes. It is the policy of each Fund of the
Trust to continue to qualify as a regulated investment company by complying
with the provisions available to certain investment companies, as defined in
applicable sections of the Internal Revenue Code, and to make distributions
of taxable income (after reduction for any amounts available for Federal
income tax purposes as capital loss carryforwards) sufficient to relieve it
from all, or substantially all, Federal income taxes. Accordingly, each Fund
paid no Federal income taxes and no provision for Federal income taxes was
required.
12
<PAGE>
4) DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: Each Fund earns income, net
of Portfolio expenses, daily on its investment in its corresponding
Portfolio. It is the policy of each Fund to declare dividends from net
investment income on each business day; such dividends are paid monthly.
Distributions from net realized capital gains, if any, are normally
distributed in December. To the extent each Fund's net realized capital
gains, if any, can be offset by capital loss carryforwards ($29, $6,430, and
$1,909 expiring in 2001, 2002, and 2003, respectively, for Ultra Short and
$86, $11,896, and $24,346 expiring in 2001, 2002, and 2003, respectively, for
Limited Maturity, determined as of October 31, 1995), it is the policy of
each Fund not to distribute such gains.
Each Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a return of capital.
Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains.
5) ORGANIZATION EXPENSES: Expenses incurred by each Fund in connection with
its organization are being amortized by each Fund on a straight-line basis
over a five-year period. At April 30, 1996, the unamortized balance of such
expenses amounted to $25,807 and $24,599 for Ultra Short and Limited
Maturity, respectively.
6) EXPENSE ALLOCATION: The Funds bear all costs of operations. Expenses incurred
by the Trust with respect to both Funds are allocated in proportion to the
net assets of the Funds, except where a more appropriate allocation of
expenses to each Fund can otherwise be made fairly. Expenses directly
attributable to a Fund are charged to that Fund.
7) OTHER: All net investment income and realized and unrealized capital gains
and losses of each Portfolio are allocated pro rata among its respective
Funds and any other investors in the Portfolio.
NOTE B -- ADMINISTRATION FEES, DISTRIBUTION ARRANGEMENTS, AND OTHER TRANSACTIONS
WITH AFFILIATES:
Each Fund retains Neuberger&Berman Management Incorporated ("Management") as
its administrator under an Administration Agreement ("Agreement") dated as
of July 12, 1993. Pursuant to this Agreement each Fund pays Management an
administration fee at the annual rate of .50% of that Fund's average daily net
assets and indirectly pays for investment management services through its
investment in its corresponding Portfolio. (See Note B of Notes to Financial
Statements of the Portfolios.) The Agreement provides if, with respect to any
fiscal year of each Fund, its total operating expenses plus its pro rata portion
of its corresponding Portfolio's operating expenses (including the fees payable
to Management but excluding interest, taxes,
13
<PAGE>
brokerage commissions, and extraordinary expenses) ("Operating Expenses") exceed
the most restrictive of the expense limitations imposed by securities laws of
the states in which such Fund's shares are qualified for sale, the
administration fees for that fiscal year will be reduced by the amount of such
excess, provided that Management has no obligation to reimburse the Fund for any
such expenses that exceed the administration fee. The most restrictive expense
limitation to which each Fund is currently subject is 2 1/2% of the first $30
million of average daily net assets, 2% of the next $70 million of average daily
net assets, and 1 1/2% of any additional average daily net assets. No reduction
in the administration fee as a result of any state expense limitation was
required for the six months ended April 30, 1996. Reduction pursuant to the
state expense limitation would have been required for Ultra Short had Management
not voluntarily undertaken to reimburse the Fund for certain expenses, as
described below.
In addition, Management has voluntarily undertaken to reimburse each Fund for
its Operating Expenses which exceed, in the aggregate, .75% per annum for Ultra
Short (.65% prior to March 1, 1995) and .80% per annum for Limited Maturity
(.70% prior to March 1, 1995) of their average daily net assets. Each
undertaking is subject to termination by Management upon at least 60 days' prior
written notice to the appropriate Fund. For the six months ended April 30, 1996,
such excess expenses amounted to $80,930 and $89,261 for Ultra Short and Limited
Maturity, respectively.
All of the capital stock of Management is owned by individuals who are also
general partners of Neuberger&Berman, L.P. ("Neuberger"), a member firm of The
New York Stock Exchange and the sub-adviser to each Portfolio. Several
individuals who are officers and/or trustees of the Trust are also partners of
Neuberger and/or officers and/or directors of Management.
Each Fund also has a distribution agreement with Management, which receives
no compensation therefor and no commissions for sales or redemptions of shares
of beneficial interest of each Fund.
NOTE C -- INVESTMENT TRANSACTIONS:
During the six months ended April 30, 1996, additions and reductions in each
Fund's investment in its corresponding Portfolio were as follows:
<TABLE>
<CAPTION>
ADDITIONS REDUCTIONS
- ------------------------------------------------------------------------------
<S> <C> <C>
ULTRA SHORT $6,441,346 $2,421,228
LIMITED MATURITY 5,541,225 3,303,494
</TABLE>
NOTE D -- UNAUDITED FINANCIAL INFORMATION:
The financial information included in this interim report is taken from the
records of each Fund without audit by independent auditors. Annual reports
contain audited financial statements.
14
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Ultra Short Bond Trust
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements. The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's proportionate share of its corresponding
Portfolio's income and expenses. It should be read in conjunction with its
corresponding Portfolio's Financial Statements and notes thereto.
<TABLE>
<CAPTION>
Six Months Period from
Ended September 7,
April 30, Year Ended October 1993(1)
1996 31, to October 31,
(UNAUDITED) 1995 1994 1993
--------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $9.85 $ 9.79 $ 9.97 $10.00
--------------------------------------------------
Income From Investment Operations
Net Investment Income .27 .53 .37 .05
Net Gains or Losses on Securities (both
realized and unrealized) (.07) .06 (.18) (.03)
--------------------------------------------------
Total From Investment Operations .20 .59 .19 .02
--------------------------------------------------
Less Distributions
Dividends (from net investment income) (.27) (.53) (.37) (.05)
--------------------------------------------------
Net Asset Value, End of Period $9.78 $ 9.85 $ 9.79 $9.97
--------------------------------------------------
Total Return+ +2.00%(2) +6.15% +1.92% +0.17%(2)
--------------------------------------------------
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $ 5.9 $ 1.7 $ 1.2 $ 0.2
--------------------------------------------------
Ratio of Expenses to Average Net Assets(3) .77%(4) .72% .65% .65%(4)
--------------------------------------------------
Ratio of Net Investment Income to Average Net
Assets(3) 5.43%(4) 5.42% 3.86% 2.98%(4)
--------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS
15
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Limited Maturity Bond Trust
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements. The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's proportionate share of its corresponding
Portfolio's income and expenses. It should be read in conjunction with its
corresponding Portfolio's Financial Statements and notes thereto.
<TABLE>
<CAPTION>
Six Months Period from
Ended August 30,
April 30, Year Ended October 1993(1)
1996 31, to October 31,
(UNAUDITED) 1995 1994 1993
--------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $9.61 $ 9.43 $ 9.97 $10.00
--------------------------------------------------
Income From Investment Operations
Net Investment Income .28 .58 .54 .08
Net Gains or Losses on Securities (both
realized and unrealized) (.14) .18 (.54) (.03)
--------------------------------------------------
Total From Investment Operations .14 .76 -- .05
--------------------------------------------------
Less Distributions
Dividends (from net investment income) (.28) (.58) (.54) (.08)
--------------------------------------------------
Net Asset Value, End of Period $9.47 $ 9.61 $ 9.43 $9.97
--------------------------------------------------
Total Return+ +1.44%(2) +8.36% -0.01% +0.55%(2)
--------------------------------------------------
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $14.2 $ 11.9 $ 6.7 $ 0.1
--------------------------------------------------
Ratio of Expenses to Average Net Assets(3) .81%(4) .77% .70% .65%(4)
--------------------------------------------------
Ratio of Net Investment Income to Average Net
Assets(3) 5.84%(4) 6.16% 5.72% 4.99%(4)
--------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS
16
<PAGE>
NOTES TO FINANCIAL HIGHLIGHTS
Neuberger&Berman April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Trust
1)The date investment operations commenced.
2)Not annualized.
3)After reimbursement of expenses by the administrator as described in Note B of
Notes to Financial Statements. Had the administrator not undertaken such
action the annualized ratios to average daily net assets would have been:
<TABLE>
<CAPTION>
PERIOD FROM
SEPTEMBER
YEAR ENDED OCTOBER 31, 7, 1993 TO
SIX MONTHS ENDED OCTOBER 31,
ULTRA SHORT APRIL 30, 1996 1995 1994 1993
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Expenses 2.50% 2.50% 2.50% 2.50%
-------------------------------------------------------------------
Net Investment
Income 3.70% 3.64% 2.01% 1.13%
-------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PERIOD FROM
AUGUST 30,
YEAR ENDED OCTOBER 31, 1993 TO
SIX MONTHS ENDED OCTOBER 31,
LIMITED MATURITY APRIL 30, 1996 1995 1994 1993
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Expenses 2.18% 2.18% 2.50% 2.50%
-------------------------------------------------------------------
Net Investment
Income 4.47% 4.75% 3.92% 3.14%
-------------------------------------------------------------------
</TABLE>
4)Annualized.
+ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of each Fund during each period
and assumes dividends and capital gain distributions, if any, were reinvested.
Results represent past performance and do not guarantee future results.
Investment returns and principal may fluctuate and shares when redeemed may be
worth more or less than original cost. Total return would have been lower if
Management had not reimbursed certain expenses.
17
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Ultra Short Bond Portfolio
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE(1)
(000'S OMITTED) MOODY'S S&P (000'S OMITTED)
- ----------------- ----------- --------- ---------------
<C> <S> <C> <C> <C>
U.S. GOVERNMENT AGENCY
SECURITIES (8.9%)
$ 4,000 Student Loan Marketing
Association, Floating Rate
Notes, 6.08%, due 7/1/96 AGY AGY $ 4,001
2,000 Federal Home Loan Bank, Bonds,
Ser. CZ-1996, 5.10%, due
7/8/96 AGY AGY 1,999
1,000 Federal Farm Credit Bank,
Bonds, 5.40%, due 12/2/96 AGY AGY 1,000
1,300 Federal Home Loan Mortgage
Corp., Notes, 7.555%, due
2/10/97 AGY AGY 1,318
250 Federal Home Loan Bank,
Floating Rate Notes, 4.775%,
due 1/29/98 AGY AGY 245
500 Federal Home Loan Bank,
Floating Rate Notes, 4.80%,
due 2/25/98 AGY AGY 490
---------------
TOTAL U.S. GOVERNMENT AGENCY
SECURITIES (COST $9,045) 9,053
---------------
MORTGAGE-BACKED SECURITIES
(18.0%)
FEDERAL HOME LOAN MORTGAGE CORP.
666 REMIC Floating Rate CMO, Ser.
1270-F, 5.9125%, due 5/15/97 AGY AGY 667
57 Mortgage Participation
Certificates, 11.50%, due
2/1/00 & 5/1/00 AGY AGY 61
4,631 Gold Balloon Payment
Certificates, 6.50%, due
3/1/97-11/1/00 AGY AGY 4,614
114 Mortgage Participation
Certificates, 10.50%, due
6/1/00-11/1/00 AGY AGY 119
1,776 Gold Balloon Payment
Certificates, 7.50%, due
11/1/01 AGY AGY 1,798
469 ARM Certificates, 7.125%, due
12/1/16 AGY AGY 473
605 ARM Certificates, 6.625%, due
3/1/17 AGY AGY 608
</TABLE>
18
<PAGE>
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Ultra Short Bond Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE(1)
(000'S OMITTED) MOODY'S S&P (000'S OMITTED)
- ----------------- ----------- --------- ---------------
<C> <S> <C> <C> <C>
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
$ 2,698 Pass-Through Certificates,
7.50%, due 10/15/09-10/15/10 AGY AGY $ 2,729
4,914 Pass-Through Certificates,
6.50%, due 11/15/10-2/15/11 AGY AGY 4,785
2,514 Pass-Through Certificates,
7.00%, due 4/15/11 AGY AGY 2,498
---------------
TOTAL MORTGAGE-BACKED
SECURITIES (COST $18,644) 18,352
---------------
ASSET-BACKED SECURITIES
(13.2%)
106 General Motors Acceptance
Corp. Grantor Trust,
Automobile Loan Pass-Through
Certificates, Ser. 1992-F,
Class A, 4.50%, due 9/15/97 Aaa AAA 106
750 Daimler-Benz Auto Grantor
Trust, Ser. 1993-A, Class A,
3.90%, due 10/15/98 Aaa AAA 744
166 USAA Auto Loan Grantor Trust,
Automobile Loan Pass-Through
Certificates, Ser. 1993-1,
3.90%, due 3/15/99 Aaa AAA 164
1,402 Ford Credit Grantor Trust,
Ser. 1995-A, Class A, 5.90%,
due 5/15/00 Aaa AAA 1,403
4,644 Onyx Acceptance Grantor Trust,
Auto Loan Pass-Through
Certificates, Ser. 1996-1,
5.40%, due 5/15/01 Aaa AAA 4,577
4,185 Caterpillar Financial Asset
Trust, Ser. 1995-A, Class A-2,
6.10%, due 8/25/01 Aaa AAA 4,180
2,306 Chase Manhattan Grantor Trust,
Automobile Loan Pass-Through
Certificates, Ser. 1995-A,
6.00%, due 9/17/01 Aaa AAA 2,300
---------------
TOTAL ASSET-BACKED SECURITIES
(COST $13,541) 13,474
---------------
</TABLE>
19
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Ultra Short Bond Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE(1)
(000'S OMITTED) MOODY'S S&P (000'S OMITTED)
- ----------------- ----------- --------- ---------------
<C> <S> <C> <C> <C>
BANKS & FINANCIAL INSTITUTIONS
(14.8%)
$ 3,000 Bayerische Hypotheken-und
Wechsel-Bank, Eurodollar C.D.,
5.33%, due 8/1/96 P-1 A-1+ $ 3,000
3,000 Norwest Corp., Medium-Term
Notes, Ser. E, 7.75%, due
12/31/96 Aa3 AA- 3,041
4,000 Deutsche Bank A.G., Yankee
C.D., 7.498%, due 1/21/97 Aaa AAA 4,052
5,000 Associates Corp. of North
America, Senior Notes, 5.75%,
due 11/15/98 Aa3 AA 4,916
---------------
TOTAL BANKS & FINANCIAL
INSTITUTIONS (COST $15,087) 15,009
---------------
CORPORATE DEBT SECURITIES
(7.9%)
1,000 British Telecom Finance B.V.,
Guaranteed Bonds, 7.625%, due
9/30/96 Aaa AAA 1,006
3,000 AT&T Capital Corp.,
Medium-Term Notes, Ser. A,
7.22%, due 11/5/96 Aa3 AA 3,023
4,000 du Pont (E.I.), de Nemours &
Co., Medium-Term Notes, Ser.
F, 6.04%, due 12/16/97 Aa2 AA 3,984
---------------
TOTAL CORPORATE DEBT
SECURITIES (COST $8,049) 8,013
---------------
CORPORATE COMMERCIAL PAPER
(39.4%)
5,000 Corporate Asset Funding Co.,
Inc., 5.33%, due 5/1/96 P-1 A-1+ 5,000(2)
1,395 Marsh & McLennan Cos., Inc.,
5.37%, due 5/1/96 P-1 A-1+ 1,395(2)
3,000 Province of Alberta, Canada,
5.32%, due 5/1/96 P-1 A-1+ 3,000(2)
3,790 Goldman Sachs Group, L.P.,
5.25%, due 5/3/96 P-1 A-1+ 3,789(2)
3,000 PepsiCo, Inc., 5.28%, due
5/6/96 P-1 A-1 2,998(2)
4,200 Raytheon Co., 5.25%, due
5/6/96 P-1 A-1+ 4,197(2)
4,000 Enterprise Funding Corp.,
5.35%, due 5/16/96 P-1 A-1 3,991(2)
</TABLE>
20
<PAGE>
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Ultra Short Bond Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE(1)
(000'S OMITTED) MOODY'S S&P (000'S OMITTED)
- ----------------- ----------- --------- ---------------
<C> <S> <C> <C> <C>
$ 4,000 UNUM Corp., 5.30%, due 5/16/96 P-1 A-1 $ 3,991(2)
4,000 Donnelley & Sons (R.R.) Co.,
5.28%, due 5/22/96 P-1 A-1 3,988(2)
2,650 Ciesco, L.P., 5.27%, due
5/23/96 P-1 A-1+ 2,641(2)
3,170 McKenna Triangle National
Corp., 5.27%, due 5/24/96 P-1 A-1+ 3,159(2)
2,000 Province of British Columbia,
Canada, 5.45%, due 7/3/96 P-1 A-1+ 1,981
---------------
TOTAL CORPORATE COMMERCIAL
PAPER (COST $40,130) 40,130
---------------
TOTAL INVESTMENTS (102.2%)
(COST $104,496) 104,031(3)
Liabilities, less cash,
receivables and other assets
[(2.2%)] (2,248)
---------------
TOTAL NET ASSETS (100.0%) $ 101,783
---------------
</TABLE>
21
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Limited Maturity Bond Portfolio
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE(1)
(000'S OMITTED) MOODY'S S&P (000'S OMITTED)
- --------------- ---------- --------- ---------------
<C> <S> <C> <C> <C>
U.S. TREASURY SECURITIES
(8.1%)
$ 1,500 U.S. Treasury Notes, 6.75%,
due 5/31/97 TSY TSY $ 1,515
1,820 U.S. Treasury Notes, 7.375%,
due 11/15/97 TSY TSY 1,857
7,930 U.S. Treasury Notes, 7.25%,
due 2/15/98 TSY TSY 8,088
1,130 U.S. Treasury Notes, 6.50%,
due 4/30/99 TSY TSY 1,138
7,265 U.S. Treasury Notes, 7.75%,
due 1/31/00 TSY TSY 7,596
3,500 U.S. Treasury Notes, 6.75%,
due 4/30/00 TSY TSY 3,544
1,070 U.S. Treasury Notes, 6.25%,
due 5/31/00 TSY TSY 1,065
---------------
TOTAL U.S. TREASURY SECURITIES
(COST $24,436) 24,803
---------------
U.S. GOVERNMENT AGENCY
SECURITIES (12.8%)
200 Federal Home Loan Bank,
Discount Notes, 5.30%, due
5/1/96 AGY AGY 200
4,855 Federal Home Loan Mortgage
Corp., Discount Notes, 5.30%,
due 5/1/96 AGY AGY 4,854
11,645 Federal National Mortgage
Association, Discount Notes,
5.21%, due 5/10/96 AGY AGY 11,628
10,000 Federal Home Loan Mortgage
Corp., Discount Notes, 5.17%,
due 5/20/96 AGY AGY 9,971
5,590 Federal Home Loan Mortgage
Corp., Discount Notes, 5.17%,
due 7/5/96 AGY AGY 5,537
7,100 Federal Home Loan Mortgage
Corp., Discount Notes, 5.17%,
due 7/17/96 AGY AGY 7,021
---------------
TOTAL U.S. GOVERNMENT AGENCY
SECURITIES (COST $39,217) 39,211
---------------
MORTGAGE-BACKED SECURITIES
(6.2%)
FEDERAL HOME LOAN MORTGAGE CORP.
221 Mortgage Participation
Certificates, 10.50%, due
10/1/00 & 12/1/00 AGY AGY 231
719 Mortgage Participation
Certificates, 8.50%, due
10/1/01 AGY AGY 736
275 ARM Certificates, 7.00%, due
1/1/17 AGY AGY 277
195 ARM Certificates, 6.875%, due
2/1/17 AGY AGY 196
807 ARM Certificates, 6.625%, due
3/1/17 AGY AGY 811
430 ARM Certificates, 7.50%, due
10/1/17 AGY AGY 439
</TABLE>
22
<PAGE>
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Limited Maturity Bond Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE(1)
(000'S OMITTED) MOODY'S S&P (000'S OMITTED)
- --------------- ---------- --------- ---------------
<C> <S> <C> <C> <C>
FEDERAL NATIONAL MORTGAGE ASSOCIATION
$ 325 Balloon Payment, Certificates,
9.00%, due 3/1/97-8/1/98 AGY AGY $ 333
365 Balloon Payment, Certificates,
8.50%, due 9/1/97-11/1/98 AGY AGY 374
1,099 Mortgage Participation
Certificates, 7.00%, due
9/1/03 AGY AGY 1,100
826 REMIC Floating Rate CMO, Ser.
1992-59F, 5.8688%, due 8/25/06 AGY AGY 827
6,160 Mortgage Participation
Certificates, 7.50%, TBA, 15
Year Maturity AGY AGY 6,187
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
223 Pass-Through Certificates,
12.00%, due 5/15/12-3/15/15 AGY AGY 256
5,247 Pass-Through Certificates,
10.00%, due 9/15/15-6/15/20 AGY AGY 5,752
1,533 Pass-Through Certificates,
9.50%, due 8/15/09-4/15/22 AGY AGY 1,642
---------------
TOTAL MORTGAGE-BACKED
SECURITIES (COST $18,992) 19,161
---------------
ASSET-BACKED SECURITIES
(12.9%)
257 World Omni Grantor Trust,
Automobile Loan Pass-Through
Certificates, Ser. 1992-A,
4.75%, due 1/15/98 Aaa AAA 255
402 Volvo Auto Receivables Grantor
Trust, Automobile Loan
Pass-Through Certificates,
Ser. 1992-A, 4.65%, due
6/15/98 Aaa AAA 400
1,500 Daimler-Benz Auto Grantor
Trust, Ser. 1993-A, Class A,
3.90%, due 10/15/98 Aaa AAA 1,489
1,576 Premier Auto Trust, Ser.
1993-3, Class A-3, 4.90%, due
12/15/98 Aaa AAA 1,564
4,139 Nissan Auto Receivables
Grantor Trust, Automobile Loan
Pass-Through Certificates,
Ser. 1994-A, Class A, 6.45%,
due 9/15/99 Aaa AAA 4,157
</TABLE>
23
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Limited Maturity Bond Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE(1)
(000'S OMITTED) MOODY'S S&P (000'S OMITTED)
- --------------- ---------- --------- ---------------
<C> <S> <C> <C> <C>
$ 5,020 Chase Manhattan Grantor Trust,
Automobile Loan Pass-Through
Certificates, Ser. 1995-B,
5.90%, due 11/15/01 Aaa AAA $ 5,007
2,379 Case Equipment Loan Trust,
Ser. 1995-A, 7.30%, due
3/15/02 Aaa AAA 2,416
6,500 Ford Credit Auto Loan Master
Trust, Auto Loan Certificates,
Ser. 1996-1, 5.50%, due
2/15/03 Aaa AAA 6,150
7,000 NationsBank Credit Card Master
Trust, Ser. 1995-1, Class A,
6.45%, due 4/15/03 Aaa AAA 6,986
6,000 ADVANTA Credit Card Master
Trust II, Ser. 1995-F, Class
A-1, 6.05%, due 8/1/03 Aaa AAA 5,837
5,000 Standard Credit Card Master
Trust I, Credit Card
Participation Certificates,
Ser. 1994-4, Class A, 8.25%,
due 11/7/03 Aaa AAA 5,345
---------------
TOTAL ASSET-BACKED SECURITIES
(COST $40,278) 39,606
---------------
BANKS & FINANCIAL INSTITUTIONS
(27.5%)
5,000 Union Bank of Finland Ltd.,
Global Notes, 5.25%, due
6/15/96 A2 BBB 4,994
5,000 State Bank of New South Wales,
Eurodollar Notes, 8.50%, due
7/1/96 Aa2 AA 5,022
10,000 Society National Bank, Bank
Notes, 6.875%, due 10/15/96 Aa3 A 10,025
5,000 BankAmerica Corp., Medium-Term
Notes, 6.875%, due 11/20/97 A1 A+ 5,030
10,000 Chase Manhattan Corp., Senior
Notes, 6.625%, due 1/15/98 A1 A 10,037
6,400 Alco Capital Resource, Inc.,
Medium-Term Notes, Ser. B,
5.46%, due 2/22/99 Baa1 A 6,203
5,890 Sovereign Bancorp Inc.,
Subordinated Debentures,
6.75%, due 9/1/00 BB+ 5,710
8,000 First USA Bank, Medium-Term
Deposit Notes, 6.375%, due
10/23/00 Baa2 BBB- 7,787
</TABLE>
24
<PAGE>
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Limited Maturity Bond Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE(1)
(000'S OMITTED) MOODY'S S&P (000'S OMITTED)
- --------------- ---------- --------- ---------------
<C> <S> <C> <C> <C>
$ 6,310 NationsBank, Senior
Medium-Term Notes, Ser. D,
5.85%, due 1/17/01 A2 A $ 6,053
6,600 Capital One Bank, Bank Notes,
5.95%, due 2/15/01 Baa3 BBB- 6,292
4,000 Bear Stearns Co. Inc., Senior
Notes, 5.75%, due 2/15/01 A2 A 3,806
6,230 Citicorp, Senior Notes,
5.625%, due 2/15/01 A1 A+ 5,926
3,000 Chase Manhattan Corp., Senior
Medium-Term Notes, Ser. B,
6.43%, due 3/29/01 A1 A 2,945
5,150 Goldman Sachs Group, L.P.,
Global Notes, 6.75%, due
2/15/06 A1 A+ 4,878(4)
---------------
TOTAL BANKS & FINANCIAL
INSTITUTIONS (COST $87,211) 84,708
---------------
CORPORATE DEBT SECURITIES
(34.3%)
8,000 Discover Credit Corp.,
Medium-Term Notes, 7.97%, due
5/7/97 A2 BBB 8,185
5,185 Borden Inc., Zero-Coupon,
Yielding 6.76%, due 5/22/97 Ba1 BB+ 4,811(4)
9,000 P.H. Glatfelter Co., Corporate
Notes, 5.875%, due 3/1/98 Baa2 BBB+ 8,839
3,000 Ford Motor Credit Co.,
Medium-Term Notes, 9.10%, due
5/4/98 A1 A+ 3,151
5,000 Xerox Credit Corp.,
Medium-Term Notes, 6.84%, due
6/1/00 A2 A 4,930
2,000 Ford Motor Credit Co.,
Medium-Term Notes, 6.84%, due
8/16/00 A1 A+ 2,000
1,770 Premark International, Inc.,
Notes, 10.50%, due 9/15/00 Baa2 BBB+ 1,990
2,510 Chesapeake Corp., Notes,
10.375%, due 10/1/00 Baa3 BBB 2,825
1,750 Sears Roebuck Acceptance
Corp., Medium-Term Notes, Ser.
I, 6.42%, due 10/10/00 A2 BBB 1,714
5,000 Sears Roebuck Acceptance
Corp., Medium-Term Notes, Ser.
I, 6.40%, due 10/11/00 A2 BBB 4,891
5,200 General Motors Acceptance
Corp., Medium-Term Notes,
8.125%, due 3/1/01 A3 A- 5,464
</TABLE>
25
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Limited Maturity Bond Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE(1)
(000'S OMITTED) MOODY'S S&P (000'S OMITTED)
- --------------- ---------- --------- ---------------
<C> <S> <C> <C> <C>
$ 4,500 Loewen Group International,
Inc., Senior Guaranteed Notes,
Ser. 1, 7.50%, due 4/15/01 Ba1(5) BB+(5) $ 4,427(4)
5,000 Rhone Poulenc S.A., Yankee
Bonds, 7.75%, due 1/15/02 Baa2 BBB 5,125
2,835 Black & Decker Corp.,
Medium-Term Notes, Ser. A,
8.90%, due 1/21/02 Baa3 BBB- 3,071
2,000 Marathon Oil, Notes, 7.00%,
due 6/1/02 Baa3 BB+ 1,972
2,000 Federated Department Stores,
Inc., Senior Notes, 8.125%,
due 10/15/02 Ba1 BB- 1,943
4,700 Viacom, Senior Notes, 6.75%,
due 1/15/03 Ba2(6) BB+(6) 4,483
1,000 Safeway Inc., Medium-Term
Notes, 8.57%, due 4/1/03 Ba1 BBB- 1,036
3,290 ADT Operations, Inc.,
Guaranteed Senior Subordinated
Notes, 9.25%, due 8/1/03 Ba3 BB+ 3,407
4,450 Tenet Healthcare Corp., Senior
Notes, 8.625%, due 12/1/03 Ba1 BB 4,539
5,950 BHP Copper Inc., Senior
Subordinated Notes, 8.70%, due
5/15/05 A2 A 6,500
4,015 Northrop Grumman, Senior
Notes, 7.00%, due 3/1/06 Baa3 BBB- 3,858(4)
5,575 Time Warner Inc., Notes,
8.11%, due 8/15/06 Ba1 BBB- 5,606
7,290 Tenneco Inc., Debentures,
10.00%, due 3/15/08 Baa2 BBB- 8,616
2,000 Riverwood International Corp.,
Senior Subordinated Notes,
10.875%, due 4/1/08 B3 B 1,993
---------------
TOTAL CORPORATE DEBT
SECURITIES (COST $108,322) 105,376
---------------
TOTAL INVESTMENTS (101.8%)
(COST $318,456) 312,865(3)
Liabilities, less cash,
receivables and other assets
[(1.8%)] (5,675)
---------------
TOTAL NET ASSETS (100.0%) $ 307,190
---------------
</TABLE>
26
<PAGE>
NOTES TO SCHEDULE OF INVESTMENTS
April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Managers Trust
1)Investment securities of the Portfolio are valued daily by obtaining bid price
quotations from independent pricing services on selected securities available
in each service's data base. For all other securities requiring daily
quotations, bid prices are obtained from principal market makers in those
securities or, if quotations are not available, by a method that the trustees
of Income Managers Trust believe accurately reflects fair value. Short-term
investments with less than sixty days until maturity at the time of purchase
may be valued at cost which, when combined with interest earned, approximates
market value.
2)At cost, which approximates market value.
3)At April 30, 1996, selected Portfolio information on a Federal income tax
basis was as follows:
<TABLE>
<CAPTION>
GROSS GROSS
UNREALIZED UNREALIZED NET UNREALIZED
NEUBERGER&BERMAN COST APPRECIATION DEPRECIATION DEPRECIATION
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ULTRA SHORT BOND PORTFOLIO $ 104,496,000 $ 49,000 $ 514,000 $ 465,000
LIMITED MATURITY BOND PORTFOLIO 318,456,000 776,000 6,367,000 5,591,000
</TABLE>
4)Security exempt from registration under the Securities Act of 1933. These
securities may be resold in transactions exempt from registration, normally
to qualified institutional buyers under Rule 144A. At April 30, 1996, these
securities amounted to $17,974,429 or 5.9% of net assets.
5)Rated BBB- by Duff & Phelps, Inc.
6)Rated BBB- by Fitch Investors Services, Inc.
SEE NOTES TO FINANCIAL STATEMENTS
27
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
LIMITED
ULTRA SHORT MATURITY
BOND BOND
(000'S OMITTED) PORTFOLIO PORTFOLIO
-------------------------------
<S> <C> <C>
ASSETS
Investments in securities, at market value*
(Note A) -- see Schedule of Investments $104,031 $312,865
Cash 2 5
Deferred organization costs (Note A) 4 11
Interest receivable 766 3,940
Prepaid expenses and other assets 3 14
Receivable for securities sold 23 58
Receivable for variation margin (Note A) -- 116
-------------------------------
104,829 317,009
-------------------------------
LIABILITIES
Payable for securities purchased 3,000 9,720
Payable to investment manager (Note B) 22 67
Accrued expenses 24 32
-------------------------------
3,046 9,819
-------------------------------
NET ASSETS Applicable to Investors'
Beneficial Interests $101,783 $307,190
-------------------------------
NET ASSETS consist of:
Paid-in capital $102,248 $312,344
Net unrealized depreciation in value of
investments and financial futures
contracts (465) (5,154)
-------------------------------
NET ASSETS $101,783 $307,190
-------------------------------
*Cost of investments $104,496 $318,456
-------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
28
<PAGE>
STATEMENTS OF OPERATIONS
For the Six Months Ended April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
LIMITED
ULTRA SHORT MATURITY
BOND BOND
(000'S OMITTED) PORTFOLIO PORTFOLIO
-------------------------
<S> <C> <C>
INVESTMENT INCOME
Interest income $3,184 $10,378
-------------------------
Expenses:
Investment management fee (Note B) 129 391
Accounting fees 5 5
Amortization of deferred organization and
initial offering expenses (Note A) 1 3
Auditing fees 11 12
Custodian fees (Note B) 40 65
Insurance expense 1 4
Legal fees 9 9
Trustees' fees and expenses 6 13
-------------------------
Total expenses 202 502
-------------------------
Net investment income 2,982 9,876
-------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS, FINANCIAL FUTURES CONTRACTS, AND
FOREIGN CURRENCY TRANSACTIONS
Net realized gain (loss) on investments sold (177) 1,554
Net realized loss on foreign currency
transactions (Note A) -- (100)
Change in net unrealized appreciation
(depreciation) of investments and
translation of assets and liabilities in
foreign currencies (652) (6,319)
Net unrealized appreciation of financial
futures contracts (Note A) -- 437
-------------------------
Net loss on investments, financial
futures contracts, and foreign
currency transactions (829) (4,428)
-------------------------
Net increase in net assets resulting from
operations $2,153 $ 5,448
-------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
29
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
- ----------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
ULTRA SHORT LIMITED MATURITY
BOND PORTFOLIO BOND PORTFOLIO
Six Months Six Months
Ended Year Ended Year
April 30, Ended April 30, Ended
1996 October 31, 1996 October 31,
(000'S OMITTED) (UNAUDITED) 1995 (UNAUDITED) 1995
---------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 2,982 $ 5,200 $ 9,876 $ 20,164
Net realized gain (loss) on
investments sold, financial
futures contracts, and foreign
currency transactions (177) (331) 1,454 (3,625)
Change in net unrealized
appreciation (depreciation) of
investments, financial futures
contracts, and translation of
assets and liabilities in foreign
currencies (652) 842 (5,882) 9,092
---------------------------------------------------------
Net increase in net assets resulting
from operations 2,153 5,711 5,448 25,631
---------------------------------------------------------
TRANSACTIONS IN INVESTORS' BENEFICIAL
INTERESTS:
Additions 14,587 37,400 27,776 42,386
Reductions (17,023) (43,021) (45,680) (64,495)
---------------------------------------------------------
Net decrease in net assets resulting
from transactions in investors'
beneficial interests (2,436) (5,621) (17,904) (22,109)
---------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (283) 90 (12,456) 3,522
NET ASSETS:
Beginning of period 102,066 101,976 319,646 316,124
---------------------------------------------------------
End of period $101,783 $102,066 $307,190 $319,646
---------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
30
<PAGE>
NOTES TO FINANCIAL STATEMENTS
April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Managers Trust
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
1) GENERAL: Neuberger&Berman Ultra Short Bond Portfolio ("Ultra Short") and
Neuberger&Berman Limited Maturity Bond Portfolio ("Limited Maturity")
(collectively, the "Portfolios") are separate operating series of Income
Managers Trust ("Managers Trust"), a New York common law trust organized as
of December 1, 1992. Managers Trust is registered as an open-end management
investment company under the Investment Company Act of 1940, as amended.
Other regulated investment companies sponsored by Neuberger&Berman Management
Incorporated ("Management"), whose financial statements are not presented
herein, also invest in these and other Portfolios of Managers Trust.
The assets of each series belong only to that series, and the liabilities
of each series are borne solely by that series and no other.
2) PORTFOLIO VALUATION: Investment securities are valued as indicated in the
notes following the Portfolios' schedule of investments.
3) FOREIGN CURRENCY TRANSLATION: The accounting records of the Portfolios are
maintained in U.S. dollars. Foreign currency amounts are translated into U.S.
dollars at the current rate of exchange of such currency against the U.S.
dollar to determine the value of investments, other assets and liabilities.
Purchase and sale prices of securities, and income and expenses are
translated into U.S. dollars at the prevailing rate of exchange on the
respective dates of such transactions.
4) FORWARD FOREIGN CURRENCY CONTRACTS: Limited Maturity may enter into
forward foreign currency contracts ("contracts") in connection with planned
purchases or sales of securities, to hedge the U.S. dollar value of portfolio
securities denominated in a foreign currency, or to increase or decrease its
exposure to a currency other than U.S. dollars. The gain or loss arising from
the difference between the original contract price and the closing price of
such contract is included in net realized gains or losses on foreign currency
transactions. Fluctuations in the value of forward foreign currency contracts
are recorded for financial reporting purposes as unrealized gains or losses
by the Portfolio. The Portfolio has no specific limitation on the percentage
of assets which may be committed to these types of contracts. The Portfolio
could be exposed to risks if a counterparty to the contracts were unable to
meet the terms of its contracts or if the value of the foreign currency
changes unfavorably. The U.S. dollar value of foreign currency underlying all
contractual commitments held by the Portfolio is determined using forward
foreign currency exchange rates supplied by an independent pricing service.
31
<PAGE>
5) FINANCIAL FUTURES CONTRACTS: Each Portfolio may buy and sell financial
futures contracts to hedge against the effects of fluctuations in interest
rates. At the time a Portfolio enters into a financial futures contract, it
is required to deposit with its custodian a specified amount of cash or U.S.
Government securities, known as "initial margin," ranging upward from 1.1% of
the value of the financial futures contract being traded. Each day, the
futures contract is valued at the official settlement price of the board of
trade or U.S. commodity exchange on which such futures contract is traded.
Subsequent payments, known as "variation margin," to and from the broker are
made on a daily basis as the market price of the financial futures contract
fluctuates. Daily variation margin adjustments, arising from this "mark to
market," are recorded by the Portfolio as unrealized gains or losses.
Although some financial futures contracts by their terms call for actual
delivery or acceptance of financial instruments, in most cases the contracts
are closed out prior to delivery by offsetting purchases or sales of matching
financial futures contracts. When the contracts are closed, the Portfolio
recognizes a gain or loss. Risks of entering into futures contracts include
the possibility that there may be an illiquid market and/or that a change in
the value of the contract may not correlate with changes in the value of the
underlying securities.
For Federal income tax purposes, the futures transactions undertaken by a
Portfolio may cause a Portfolio to recognize gains or losses from marking to
market even though its positions have not been sold or terminated, may affect
the character of the gains or losses recognized as long-term or short-term,
and may affect the timing of some capital gains and losses realized by the
Portfolio. Also, the Portfolio's losses on its transactions involving futures
contracts may be deferred rather than being taken into account currently in
calculating the Portfolio's taxable income. At April 30, 1996, open positions
in financial futures contracts for Limited Maturity were as follows:
<TABLE>
<CAPTION>
UNREALIZED
EXPIRATION OPEN CONTRACTS POSITION APPRECIATION
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C>
June, 1996 41 U.S. Treasury Notes, 5 year Short $ 45,484
June, 1996 283 U.S. Treasury Notes, 10 year Short 391,938
</TABLE>
32
<PAGE>
At April 30, 1996, Limited Maturity had the following securities deposited in
a segregated account to cover margin requirements on open financial futures
contracts:
<TABLE>
<CAPTION>
PAR VALUE SECURITY
- ----------------------------------------------------------------
<C> <S>
Federal Home Loan Mortgage Corp., Discount Notes,
$ 495,000 5.17%, due 7/5/96
4,555,000 Capital One Bank, Bank Notes, 5.95%, due 2/15/01
Federated Department Stores, Inc., Senior Notes,
2,000,000 8.125%, due 10/15/02
BHP Copper Inc., Senior Subordinated Notes, 8.70%,
5,950,000 due 5/15/05
Goldman Sachs Group, L.P., Global Notes, 6.75%,
5,150,000 due 2/15/06
4,015,000 Northrop Grumman, Senior Notes, 7.00%, due 3/1/06
4,000,000 Time Warner Inc., Notes, 8.11%, due 8/15/06
5,000,000 Tenneco Inc., Debentures, 10.00%, due 3/15/08
</TABLE>
6) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on a trade date basis. Interest income, including accretion of
discount (adjusted for original issue discount, where applicable), is
recorded on the accrual basis. Realized gains and losses from securities
transactions are recorded on the basis of identified cost.
7) FEDERAL INCOME TAXES: Managers Trust intends to comply with the
requirements of the Internal Revenue Code of 1986, as amended. Each Portfolio
of Managers Trust also intends to conduct its operations so that each of its
investors will be able to qualify as a regulated investment company. Each
Portfolio will be treated as a partnership for Federal income tax purposes
and is therefore not subject to Federal income tax.
8) ORGANIZATION EXPENSES: Expenses incurred by each Portfolio in connection
with its organization are being amortized by each Portfolio on a
straight-line basis over a five-year period. At April 30, 1996, the
unamortized balance of such expenses amounted to $4,161 and $11,495 for Ultra
Short and Limited Maturity, respectively.
9) EXPENSE ALLOCATION: The Portfolios bear all costs of operations. Expenses
incurred by Managers Trust with respect to both Portfolios are allocated in
proportion to the net assets of the Portfolios, except where a more
appropriate allocation of expenses to each Portfolio can otherwise be made
fairly. Expenses directly attributable to a Portfolio are charged to that
Portfolio.
NOTE B -- MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES:
Each Portfolio retains Management as its investment manager under a
Management Agreement dated as of July 2, 1993. For such investment management
services, each Portfolio pays Management a fee at the annual rate of .25% of the
first $500 million of that Portfolio's average daily net assets, .225% of the
next $500 million, .20% of the next $500 million, .175% of the next $500
million, and .15% of average daily net assets in excess of $2 billion.
33
<PAGE>
All of the capital stock of Management is owned by individuals who are also
general partners of Neuberger&Berman, L.P. ("Neuberger"), a member firm of The
New York Stock Exchange and the sub-adviser to each Portfolio. Neuberger is
retained by Management to furnish it with investment recommendations and
research information without cost to each Portfolio. Several individuals who are
officers and/ or trustees of Managers Trust are also partners of Neuberger
and/or officers and/or directors of Management.
Each Portfolio has an expense offset arrangement included in its custodian
contract. The impact of this arrangement on each Portfolio's custodian expense,
reflected in the Statement of Operations, is less than .01% of the Portfolio's
average daily net assets.
NOTE C -- SECURITIES TRANSACTIONS:
During the six months ended April 30, 1996, there were purchase and sale
transactions (excluding short-term securities, financial futures contracts, and
forward foreign currency contracts) as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
- -------------------------------------------------------------------------------
<S> <C> <C>
ULTRA SHORT $40,862,657 $49,615,103
LIMITED MATURITY 246,450,856 247,512,913
</TABLE>
During the six months ended April 30, 1996, Limited Maturity entered into
various contracts to deliver currencies at specified future dates. There were no
open positions in these contracts at April 30, 1996.
NOTE D -- UNAUDITED FINANCIAL INFORMATION:
The financial information included in this interim report is taken from the
records of each Portfolio without audit by independent auditors. Annual reports
contain audited financial statements.
34
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
ULTRA SHORT LIMITED MATURITY
BOND PORTFOLIO BOND PORTFOLIO
Period Period
from from
July 2, July 2,
1993 1993
(Commencement (Commencement
Six Months of Six Months of
Ended Operations) Ended Operations)
April 30, Year Ended October to October April 30, Year Ended October to October
1996 31, 31, 1996 31, 31,
(UNAUDITED) 1995 1994 1993 (UNAUDITED) 1995 1994 1993
------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RATIOS TO AVERAGE NET ASSETS:
Expenses .39%(1) .40% .38% .40%(1) .32%(1) .33% .34% .33%(1)
------------------------------------------------------------------------------------------------
Net Investment Income 5.78%(1) 5.67% 3.98% 4.00%(1) 6.23%(1) 6.55% 5.86% 5.53%(1)
------------------------------------------------------------------------------------------------
Portfolio Turnover Rate 56% 148% 94% 46% 87% 88% 102% 71%
------------------------------------------------------------------------------------------------
Net Assets, End of Period (in
millions) $101.8 $102.1 $102.0 $104.3 $307.2 $319.6 $316.1 $357.9
------------------------------------------------------------------------------------------------
</TABLE>
1) Annualized
35
<PAGE>
DIRECTORY
INVESTMENT MANAGER, ADMINISTRATOR
AND DISTRIBUTOR
Neuberger&Berman Management Incorporated
605 Third Avenue 2nd Floor
New York, NY 10158-0180
800-877-9700
Institutional Services 800-366-6264
SUB-ADVISER
Neuberger&Berman, L.P.
605 Third Avenue
New York, NY 10158-3698
CUSTODIAN AND SHAREHOLDER
SERVICING AGENT
State Street Bank and Trust Company
225 Franklin Street
Boston, MA 02110
ADDRESS CORRESPONDENCE TO:
Neuberger&Berman Funds
Institutional Services
605 Third Avenue 2nd Floor
New York, NY 10158-0180
LEGAL COUNSEL
Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, NW
2nd Floor
Washington, DC 20036-1800
Neuberger&Berman Management Inc., Neuberger&Berman Ultra Short Bond Trust and
Neuberger&Berman Limited Maturity Bond Trust are registered servicemarks of
Neuberger&Berman Management Inc.
- -C- 1996 Neuberger&Berman Management Inc.
36
<PAGE>
OFFICERS AND TRUSTEES
Stanley Egener
CHAIRMAN OF THE BOARD AND TRUSTEE
Theresa A. Havell
PRESIDENT AND TRUSTEE
John Cannon
TRUSTEE
Charles DeCarlo
TRUSTEE
Barry Hirsch
TRUSTEE
Robert A. Kavesh
TRUSTEE
Harold R. Logan
TRUSTEE
William E. Rulon
TRUSTEE
Candace L. Straight
TRUSTEE
Daniel J. Sullivan
VICE PRESIDENT
Michael J. Weiner
VICE PRESIDENT
Richard Russell
TREASURER
Claudia A. Brandon
SECRETARY
Barbara DiGiorgio
ASSISTANT TREASURER
Celeste Wischerth
ASSISTANT TREASURER
Stacy Cooper-Shugrue
ASSISTANT SECRETARY
C. Carl Randolph
ASSISTANT SECRETARY
37
<PAGE>
(This page has been left blank intentionally.)
38
<PAGE>
NEUBERGER&BERMAN MANAGEMENT INC. -Registered Trademark-
605 THIRD AVENUE 2ND FLOOR
NEW YORK, NY 10158-0180
SHAREHOLDER SERVICES
800.877.9700
INSTITUTIONAL SERVICES
800.366.6264
Statistics and projections in this report are derived from sources
deemed to be reliable but cannot be regarded as a representation of
future results of the Funds. This report is prepared for the general
information of shareholders and is not an offer of shares of the Funds.
Shares are sold only through the currently effective prospectus, which
must precede or accompany this report.
[LOGO] PRINTED ON RECYCLED PAPER
WITH SOY BASED INKS NBITSAR00496
<PAGE>
