SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant x
Filed by a Party other than the Registrant o
Check the appropriate box:
x Preliminary Proxy Statement
o Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
o Definitive Proxy Statement
o Definitive Additional Materials
o Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Neuberger Berman Equity Assets
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
x No fee required.
o Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
o Fee paid previously with preliminary materials.
o Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
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NEUBERGER BERMAN SOCIALLY RESPONSIVE TRUST
(A SERIES OF NEUBERGER BERMAN EQUITY ASSETS)
Dear Shareholder:
The attached Proxy Statement discusses three Proposals (the "Proposals") to
be voted upon by the holders of Neuberger Berman Socially Responsive Trust
("Fund"). As a shareholder of the Fund, you are asked to review the Proxy
Statement and to cast your vote on the Proposals. The Board of Trustees of
Equity Assets recommends that shareholders approve the Proposals.
Proposal 1 seeks your approval to convert the Fund, currently a series of
Neuberger Berman Equity Assets ("Equity Assets"), to a series of Neuberger
Berman Equity Trust ("Equity Trust"). The conversion of the Fund to a series of
Equity Trust is part of a proposed realignment of several Neuberger Berman funds
and is intended to avoid confusion and difficulty in the administration of these
funds. The attached proxy materials provide more information about the proposed
conversion.
Proposal 2 seeks approval of a plan of distribution to authorize the Fund
to spend 0.10% of average daily net assets each year for distribution and/or
shareholder servicing expenses. Proposal 3 seeks shareholder ratification of the
Fund's independent accountants. These Proposals are discussed in greater detail
in the attached proxy materials. THE BOARD OF TRUSTEES OF EQUITY ASSETS
UNANIMOUSLY RECOMMENDS A VOTE FOR EACH PROPOSAL.
YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWN. Voting your
shares early will permit the Fund 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 return envelope. As an
alternative to using the paper proxy card to vote, you may vote by telephone,
through the Internet or in person. However, any proposal submitted to a vote at
the meeting by anyone other than the officers or Trustees of Equity Assets may
be voted only in person or by written proxy.
Very truly yours,
-----------------
Lawrence Zicklin
PRESIDENT,
NEUBERGER BERMAN EQUITY ASSETS
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NEUBERGER BERMAN SOCIALLY RESPONSIVE TRUST
(A SERIES OF NEUBERGER BERMAN EQUITY ASSETS)
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NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON OCTOBER 15, 1999
------------------------
A special meeting of the shareholders of Neuberger Berman Socially
Responsive Trust (the "Fund"), a series of Neuberger Berman Equity Assets
("Equity Assets") will be held at 605 Third Avenue, 41st Floor, New York, New
York 10158-0180 on October 15, 1999 at 10:00 a.m. Eastern time. The special
meeting is being held for the following purposes:
1. To approve an Agreement and Plan of Realignment and Termination
providing for the conversion of the Fund from a series of Equity
Assets to a separate series of Neuberger Berman Equity Trust;
2. To approve a plan of distribution to authorize the Fund to spend
annually 0.10% of average daily net assets to pay for distribution
and/or shareholder servicing expenses;
3. To ratify the selection of PricewaterhouseCoopers LLP as the
independent accountants of the Fund; and
4. To consider and vote upon such other matters as may properly come
before the meeting or any adjournments thereof.
Proposals 1 - 3 are discussed in greater detail in the attached Proxy
Statement. You are entitled to vote at the meeting and any adjournment thereof
if you owned shares of the Fund at the close of business on August 2, 1999. IF
YOU ATTEND THE MEETING, YOU MAY VOTE YOUR SHARES IN PERSON. IF YOU DO NOT EXPECT
TO ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY
CARD IN THE ENCLOSED POSTAGE-PAID ENVELOPE. YOU MAY ALSO VOTE BY TELEPHONE OR
THROUGH THE INTERNET. HOWEVER, ANY PROPOSAL SUBMITTED AT THE MEETING BY ANYONE
OTHER THAN THE OFFICERS OR TRUSTEES OF EQUITY ASSETS MAY BE VOTED ONLY IN PERSON
OR BY WRITTEN PROXY.
<PAGE>
By order of the Board of Trustees,
Claudia A. Brandon
SECRETARY,
NEUBERGER BERMAN EQUITY ASSETS
August 16, 1999
New York, New York
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YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWN
Please indicate your voting instructions on the enclosed proxy card, sign and
date the card, and return it in the envelope provided. IF YOU SIGN, DATE AND
RETURN THE PROXY CARD BUT GIVE NO VOTING INSTRUCTIONS, YOUR SHARES WILL BE VOTED
"FOR" THE PROPOSALS DESCRIBED ABOVE. In order to avoid the additional expense of
further solicitation, we ask your cooperation in mailing your proxy card(s)
promptly. As an alternative to using the paper proxy card(s) to vote, you may
vote by telephone, through the Internet or in person. To vote by telephone,
please call the toll-free number listed on the enclosed proxy card(s). Shares
that are registered in your name, as well as shares held in "street name"
through a broker may be voted via the Internet or by telephone. To vote in this
manner, you will need the 12-digit "control" number(s) that appear on your proxy
card(s). To vote via the Internet, please access http:www.proxyvote.com on the
World Wide Web. If we do not receive your completed proxy card(s) after several
weeks, you may be contacted by Neuberger Berman Management Inc., the Fund's
investment manager. You may also call ADP Investor Communication Services
directly at [1-800-690-6903], and vote by phone. However, any proposal submitted
for a vote at the meeting by anyone other than the officers or Trustees of
Equity Assets may be voted only in person or by written proxy.
Unless proxy card(s) submitted by corporations and partnerships are signed by
the appropriate persons as indicated in the voting instructions on the proxy
card, they will not be voted.
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NEUBERGER BERMAN SOCIALLY RESPONSIVE TRUST
(A SERIES OF NEUBERGER BERMAN EQUITY ASSETS)
605 THIRD AVENUE
NEW YORK, NEW YORK 10158-0180
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PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS
OCTOBER 15, 1999
------------------------
VOTING INFORMATION
The Board of Trustees of Neuberger Berman Equity Assets ("Equity Assets")
is soliciting the accompanying proxy for use at a Special Meeting of
shareholders of Neuberger Berman Socially Responsive Trust ("Fund"), to be held
on October 15, 1999 at 10:00 a.m. Eastern time, at the offices of Neuberger
Berman Equity Assets, 605 Third Avenue, 41st Floor, New York, New York
10158-0180, and at any adjournments thereof (the "Meeting"). This Proxy
Statement is first being mailed on or about August 16, 1999. A Notice of Special
Meeting of Shareholders and a proxy card accompany this statement.
One-third of the Fund's shares outstanding and entitled to vote on August
2, 1999 ("Record Date"), represented in person or by proxy, shall be a quorum
and must be present for the transaction of business at the Meeting. If a quorum
is not present at the Meeting or a quorum is present but sufficient votes to
approve one or more proposals set forth in this proxy statement ("Proposals")
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 can be made by the affirmative vote of those
shares represented 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 or all of the Proposals in this Proxy Statement prior to such adjournment if
sufficient votes have been received for approval and it is otherwise
appropriate.
The individuals named as proxies on the enclosed proxy card will vote in
accordance with your directions as indicated on that proxy card, if it is
received properly executed by you or your duly appointed agent or
attorney-in-fact. If you sign, date and return the proxy card, but give no
voting instructions, your shares will be voted will be voted FOR Proposals 1-3
described in the accompanying Notice of Special Meeting of Shareholders. Proxies
that reflect abstentions and "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
<PAGE>
have discretionary voting power on a particular matter) will be counted as
shares that are present and entitled to vote for purposes of determining the
presence of a quorum. With respect to each Proposal, abstentions and broker
non-votes have the effect of a negative vote on the Proposal. Abstentions and
broker non-votes will not be counted, however, as votes cast for purposes of
determining whether sufficient votes have been received to approve a Proposal.
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 Equity
Assets 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 Equity Assets 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 Neuberger Berman Management Inc. ("NBMI"), affiliates of NBMI or
other representatives of the Fund. NBMI serves as principal underwriter and
administrator of the Fund. NBMI and its affiliates will not receive any
compensation from the Fund for proxy solicitation activities. Proxy
solicitations may also be made by ADP Investor Communication Services,
professional proxy solicitors, which will be paid fees and expenses of up to
approximately $______ for soliciting services. If votes are recorded by
telephone, ADP Investor Communication Services 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. [The Board will
allocate the overall cost between the two Proposals. The cost of solicitation
and the expenses incurred in connection with preparing Proposal 1 of this Proxy
Statement will be allocated between the Fund and NBMI. The cost of solicitation
and the expenses incurred in connection with preparing Proposals 2 and 3 will by
paid by the Funds.] PLEASE NOTE THAT WHILE PROXIES MAY BE VOTED BY TELEPHONE OR
THROUGH THE INTERNET FOR PROPOSALS 1-3, ANY PROPOSAL SUBMITTED TO A VOTE AT THE
MEETING BY ANYONE OTHER THAN THE OFFICERS OR TRUSTEES OF EQUITY ASSETS MUST BE
VOTED IN PERSON OR BY WRITTEN PROXY.
As of August 2, 1999, the following number of shares of the Fund were
outstanding, and the shares of the Fund over which NBMI or its affiliates,
including Neuberger Berman, LLC, exercised voting control were as follows:
NUMBER OF SHARES SHARES FOR WHICH NBMI AND ITS
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OUTSTANDING AFFILIATES EXERCISE VOTING CONTROL*
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________________ __________ shares or __% of the
outstanding shares
* Certain of these shares are held by NBMI and its affiliates in various
fiduciary capacities. For those shares over which NBMI and affiliated entities
have voting control, an independent fiduciary has been retained to vote the
shares in the best interest of the beneficial owners of those shares.
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<PAGE>
In addition, to the knowledge of Equity Assets, as of August 2, 1999, the
following are all of the beneficial owners of more than five percent of the
Fund:
NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT OF THE FUND
BENEFICIAL OWNER BENEFICIAL OWNERSHIP* OWNED
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[Reflect amounts as to which the beneficial owner has sole voting power, shared
voting power, sole investment power, or shared investment power]
*At August 2, 1999, the Trustees and officers of Equity Assets as a group
beneficially owned less than 1% of the shares of the Fund. Certain Trustees and
officers of Equity Assets are employees and shareholders of NBMI, which will
benefit if the Distribution and Shareholder Services Plan is approved.
COPIES OF THE FUND'S MOST RECENT ANNUAL AND SEMI-ANNUAL REPORTS, INCLUDING
FINANCIAL STATEMENTS, HAVE PREVIOUSLY BEEN DELIVERED TO SHAREHOLDERS.
SHAREHOLDERS OF THE FUND MAY REQUEST COPIES OF THE FUND'S ANNUAL REPORT FOR THE
FISCAL YEAR ENDED AUGUST 31, 1998, INCLUDING AUDITED FINANCIAL STATEMENTS, AND
THE FUND'S SEMI-ANNUAL REPORT FOR THE PERIOD ENDED FEBRUARY 28, 1999, 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.
REQUIRED VOTE. Approval of the Agreement and Plan of Realignment and
Termination (Proposal 1) and approval of the Distribution and Shareholder
Services Plan (Proposal 2) each requires the affirmative vote of a "majority of
the outstanding voting securities" of the Fund, as defined in the Investment
Company Act of 1940, as amended ("1940 Act"). This means that Proposal 1 and
Proposal 2 each must be approved by the lesser of (i) 67% of the Fund's shares
present at a Meeting of shareholders if the owners of more than 50% of the
Fund's shares then outstanding are present in person or by proxy or (ii) more
than 50% of the Fund's outstanding shares. Ratification of the independent
accountants of the Fund (Proposal 3) requires the affirmative vote of a majority
of the shares of the Fund present and voting at the Meeting, provided a quorum
is present. Each outstanding full share of the Fund is entitled to one vote, and
each outstanding fractional share thereof is entitled to a proportionate
fractional share of one vote.
In order that your shares may be represented at the Meeting, you are
requested to:
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<PAGE>
- indicate your instructions on the proxy card;
- date and sign the proxy card;
- mail the proxy card promptly in the enclosed envelope, which requires
no postage if mailed in the United States; and
- allow sufficient time for the proxy card to be received on or before
[5:00] p.m. on ____________, 1999.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903
TOLL-FREE OR VISIT HTTP://WWW.PROXYVOTE.COM ON THE WORLD WIDE WEB.
The principal office of Neuberger Berman Equity Assets is located at 605
Third Avenue, New York, New York 10158-0180.
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GENERAL OVERVIEW OF THE PROPOSALS
The following is a brief overview regarding the matters being presented for
your approval at the Meeting:
Proposal 1 seeks your approval to convert the Fund, currently a series of
Neuberger Berman Equity Assets ("Equity Assets"), to a series of Neuberger
Berman Equity Trust ("Equity Trust"). The conversion of the Fund to a series of
Equity Trust is part of a proposed realignment of several Neuberger Berman funds
that invest in Neuberger Berman Socially Responsive Portfolio (collectively, the
"Socially Responsive Series"). Each respective Socially Responsive Series is
made available to different types of investors via different intermediaries. The
purpose of these conversions is to avoid confusion and difficulty in the
administration of the Socially Responsive Series.
Proposal 2 seeks your approval to adopt a distribution and shareholder
services plan (the "Distribution and Shareholder Services Plan"). The
Distribution and Shareholder Services Plan would allow the Fund to spend
annually 0.10% of its average daily net assets to compensate NBMI, the Fund's
principal underwriter, for shareholder servicing activities and/or expenses
primarily intended to result in the sale of shares of the Fund. Shares of the
Fund are not currently covered by any distribution plan, and the 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 the Fund by 0.10% of average daily net
assets.
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<PAGE>
NBMI believes that the Distribution and Shareholder Services Plan is
appropriate if investors are to continue receiving a high level of shareholder
services, and if NBMI is to continue its successful relationship with many of
the pension administrators and fund supermarket sponsors who make the Fund
available to investors.
Proposal 3 asks the Fund's shareholders to ratify the selection of
PricewaterhouseCoopers LLP to serve as the Fund's independent accountants.
PROPOSAL 1 - APPROVAL OF AN AGREEMENT AND PLAN OF REALIGNMENT AND
TERMINATION ("REALIGNMENT PLAN") PROVIDING FOR THE REALIGNMENT OF THE FUND
FROM A SERIES OF EQUITY ASSETS TO A SERIES OF NEUBERGER BERMAN EQUITY TRUST
("EQUITY TRUST")
The Fund is presently organized as a series of Equity Assets. The Board of
Equity Assets has approved the Realignment Plan in the form attached to this
Proxy Statement as Appendix A. The Realignment Plan provides for the conversion
of the Fund from a series of Equity Assets, a Delaware business trust, to a
newly established series (the "New Series") of Equity Trust, also a Delaware
business trust (the "Realignment"). FROM AN INVESTOR'S PERSPECTIVE, THE PROPOSED
CHANGE WILL HAVE NO MATERIAL EFFECT ON THE SHAREHOLDERS, OFFICERS, OPERATIONS OR
MANAGEMENT OF THE FUND. The Realignment will make administration of the Fund
easier.
The Fund invests all of its net investable assets in Neuberger Berman
Socially Responsive Portfolio (the "Portfolio"), a series of Equity Managers
Trust, a New York common law trust organized as an open-end management
investment company. The Portfolio invests in securities in accordance with an
investment objective, policies, and limitations identical to those of the Fund.
NBMI serves as the investment manager and Neuberger Berman, LLC ("Neuberger
Berman") serves as sub-adviser to the Portfolio.
The New Series, which has not yet commenced business operations and will be
established for the purpose of effecting the Realignment, will carry on the
business of the Fund following the Realignment and will have investment
objectives, policies, and limitations identical to those of the Fund. Since both
Equity Assets and Equity Trust are Delaware business trusts organized under
nearly identical Trust Instruments, the rights of the security holders of the
Fund under state law and its governing documents remain unchanged after the
Realignment. Shareholder voting rights under both Equity Assets and Equity Trust
are currently based on the number of shares owned. The same individuals serve as
trustees of both Equity Assets and Equity Trust.
NBMI will be responsible for providing the New Series with various
administrative services, subject to the supervision of the Board of Trustees of
Equity Trust (the "Equity Trust Board"), under an Administration Agreement
substantially identical to the contract in effect between NBMI and Equity Assets
immediately prior to the Realignment. Following the Realignment, NBMI will act
as distributor for the New Series without charge under a Distribution Agreement
substantially identical to the contract in effect between NBMI and Equity Assets
immediately prior to the Realignment. NBMI will continue to act as investment
manager to the Portfolio pursuant to the existing agreement between NBMI and the
Portfolio.
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<PAGE>
The proposal to present the Realignment Plan was approved by the Board,
including a majority of its trustees who are not "interested persons," as that
term is defined in the 1940 Act ("Independent Trustees"), on July 29, 1999. The
Board recommends that the Plan trustees vote FOR the approval of the Realignment
Plan. Such a vote encompasses approval of both (i) the conversion of the Fund to
a series of Equity Trust; and (ii) a temporary waiver of certain investment
limitations of the Fund to permit the Realignment (see "Temporary Waiver of
Investment Restrictions" below). If the Fund shareholders do not approve the
Realignment Plan set forth herein, the Fund will continue to operate as a series
of Equity Assets.
REASONS FOR THE PROPOSED REALIGNMENT
The Board unanimously recommends conversion of the Fund to a series of
Equity Trust. Moving the Fund from Equity Assets to Equity Trust will increase
the efficiency of Fund administration. [For example, the Realignment will
consolidate and streamline the production and mailing of certain financial
reports and legal documents, reducing expense to the Fund.] [PLEASE CONFIRM]
FROM AN INVESTOR'S PERSPECTIVE, THE PROPOSED CHANGE WILL HAVE NO MATERIAL EFFECT
ON THE SHAREHOLDERS, OFFICERS, OPERATION OR MANAGEMENT OF THE FUND.
Most mutual funds today are organized as "series" within a larger trust or
corporation. Each series is operated in most respects as a separate mutual fund,
with its own investment policies, portfolio managers, and shareholders. The
Fund, for example, is part of a trust called Neuberger Berman Equity Assets.
Also involved in the proposed Realignment, besides the Fund, are two other
mutual funds that are series of different trusts, Neuberger Berman Socially
Responsive Assets and Neuberger Berman NYCDC Socially Responsive Trust
(collectively, with the Fund, the "Socially Responsive Series").
NBMI has established a number of trusts. Shares of the series of these
trusts are made available to different types of investors through different
programs. All of the series of a particular trust, except the Socially
Responsive Series, are organized and operated in a way that serves a particular
type of investment program. For historical reasons, which are no longer
significant, the Socially Responsive Series were placed in different trusts. The
Fund, for example, was placed in Equity Assets, and is available through a
variety of pension plans, brokers and mutual fund "supermarkets." The Fund
should be placed in the trust, i.e., Equity Trust, whose series sell their
shares through the same intermediaries as the Fund. As the number of Socially
Responsive Series has grown, this misalignment has become administratively
cumbersome, resulting in extra Securities and Exchange Commission filings,
additional legal costs, and added potential for costly errors.
For these reasons, both NBMI and the Boards of Trustees of the trusts
believe it is desirable to realign the Socially Responsive Series in the proper
trusts.
The realignment of the Socially Responsive Series can take place only if
all Socially Responsive Series take part. Thus, even if the Plan trustees
approve the Fund's conversion to a series of Equity Trust, the Realignment will
only occur if the other two Socially Responsive Series approve a similar
realignment.
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<PAGE>
SUMMARY OF THE REALIGNMENT PLAN
The following discussion summarizes the important terms of the Realignment
Plan. This summary is qualified in its entirety by reference to the Realignment
Plan itself, which is attached as Appendix A to this Proxy Statement.
If this Proposal is approved by Fund shareholders, Equity Assets will
create the New Series. On November __, 1999 or such later date to which Equity
Assets and Equity Trust agree (the "Closing Date"), the Fund will transfer all
of its assets to the New Series in exchange solely for shares of the New Series
("New Series Shares") equal to the number of the Fund shares outstanding on the
Closing Date ("Fund Shares") and the assumption by the New Series of all of the
liabilities of the Fund. Immediately thereafter, the Fund will constructively
distribute to each investor one New Series Share for each Fund Share held by the
shareholder on the Closing Date in liquidation of the Fund Shares. As soon as is
practicable after this distribution of New Series Shares, the Fund will be
terminated as a series of Equity Assets. UPON COMPLETION OF THE REALIGNMENT,
EACH FUND INVESTOR WILL OWN FULL AND FRACTIONAL NEW SERIES SHARES EQUAL IN
NUMBER, DENOMINATION AND AGGREGATE NET ASSET VALUE TO THE FUND SHARES THE
INVESTOR HELD IMMEDIATELY BEFORE THE REALIGNMENT.
The Realignment Plan obligates Equity Trust, on behalf of the New Series,
to enter into (i) an Administration Agreement with respect to the New Series
(the "New Administration Agreement") and (ii) a Distribution Agreement (the "New
Distribution Agreement") with respect to the New Series (collectively, the "New
Agreements"). Each New Agreement will be virtually identical to the
corresponding contract in effect with respect to Equity Assets prior to the
Closing Date. The Administration Agreement must be approved by the Equity Trust
Board, including a majority of its Independent Trustees. Under the 1940 Act, the
Distribution Agreement must be approved by a majority of the Independent
Trustees of Equity Trust cast in person at a meeting called for the purpose of
voting on such approval, or by a majority of the outstanding voting securities.
The New Agreements will take effect on the Closing Date, and each will
continue in effect until [August 2, 2000]. Thereafter, the New Administration
Agreement will continue in effect only if its continuance is approved at least
annually by the vote or written consent of the Equity Trust Board, including a
majority of its Independent Trustees. The New Distribution Agreement will
continue in effect only if approved annually (i) by the vote of a majority of
Equity Trust's Independent Trustees cast in person at a meeting called for the
purpose of voting on such approval or (ii) by the vote of a majority of trustees
or a majority of the outstanding voting shares of the New Series, and may be
terminated at any time without penalty by a vote of a majority of Equity Trust's
Independent Trustees or a majority of the outstanding voting shares of the New
Series.
The obligations of Equity Assets and Equity Trust under the Realignment
Plan are subject to various conditions as stated therein. Notwithstanding the
approval of the Realignment Plan by Fund shareholders, it may be terminated or
amended at any time prior to the Realignment by action of either the Equity
Assets or Equity Trust Board (so long as the amendment, if made after approval
of the Realignment Plan, does not materially adversely affect the Fund's
shareholders' interests) and may be terminated prior thereto by either Equity
Assets or Equity Trust if (i) there is a material breach by the other party of
any representation, warranty, or agreement contained in the Realignment Plan to
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<PAGE>
be performed at or prior to the Closing Date or (ii) it reasonably appears that
the other party will not or cannot meet a condition of the Realignment Plan.
Either Equity Assets or Equity Trust may at any time waive compliance with any
of the covenants and conditions contained in the Realignment Plan, provided that
the waiver does not materially adversely affect the interests of Fund
shareholders.
CONTINUATION OF FUND SHAREHOLDER ACCOUNTS
Equity Trust's transfer agent will establish accounts for the New Series
shareholders containing the appropriate number of New Series Shares to be
received by each holder of Fund Shares under the Realignment Plan. Such accounts
will be identical in all material respects to the accounts currently maintained
by the Fund's transfer agent for the Fund's shareholders.
EXPENSES
The expenses of the Realignment, estimated at $________ in the aggregate,
will be borne by NBMI.
TEMPORARY WAIVER OF INVESTMENT RESTRICTIONS
Certain fundamental investment restrictions of the Fund, which prohibit it
from acquiring more than a stated percentage of ownership of another company
(other than its investment in the Portfolio), might be construed as restricting
its ability to carry out the Realignment. "Fundamental" investment restrictions
can be changed only with shareholder approval. By approving the Realignment
Plan, Fund shareholders will be agreeing to waive, only for the purpose of the
Realignment, those fundamental investment restrictions that could prohibit or
otherwise impede the transaction.
TAX CONSEQUENCES OF THE REALIGNMENT
Both Equity Assets and Equity Trust will receive an opinion from their
counsel, Kirkpatrick & Lockhart LLP, that the Realignment will constitute a
tax-free reorganization within the meaning of section 368(a)(1)(F) of the
Internal Revenue Code of 1986, as amended. Accordingly, neither the Fund, the
New Series nor the Fund's shareholders will recognize gain or loss for federal
income tax purposes upon (i) the transfer of the Fund's assets in exchange
solely for New Series Shares and the assumption by the New Series of the Fund's
liabilities or (ii) the distribution of the New Series Shares to the Fund's
shareholders in liquidation of their Fund Shares. The opinion will further
provide, among other things, that (1) a Fund shareholder's aggregate basis for
federal income tax purposes of the New Series Shares to be received by the
shareholder in the Realignment will be the same as the aggregate basis of Fund
Shares to be constructively surrendered in exchange for those New Series Shares
and (2) a Fund shareholder's holding period for the New Series Shares will
include the shareholder's holding period for the Fund Shares, provided that
those Fund Shares were held as capital assets at the time of Realignment.
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<PAGE>
CONCLUSION
The Board has concluded that the proposed Realignment Plan is in the best
interests of the Fund's shareholders. A vote in favor of the Realignment Plan
encompasses (i) approval of the conversion of the Fund to the New Series, and
(ii) approval of the temporary waiver of certain investment limitations of the
Fund to permit the Realignment (see "Temporary Waiver of Investment
Restrictions" above). If approved, the Realignment Plan will take effect on the
Closing Date. If the Realignment Plan is not approved, the Fund will continue to
operate as a series of Equity Assets.
THE BOARD UNANIMOUSLY RECOMMENDS THAT FUND SHAREHOLDERS
VOTE "FOR" PROPOSAL 1.
-----------------------------------------------------------
PROPOSAL 2 - APPROVAL OF THE DISTRIBUTION AND SHAREHOLDER SERVICES PLAN
The Board of Trustees has approved, and recommends that shareholders of the
Fund approve, the Distribution and Shareholder Services Plan. The Distribution
and Shareholder Services Plan would authorize the Fund to pay a fee at an annual
rate of 0.10% of its average daily net assets, to be calculated daily and paid
monthly, for ongoing services to investors in the Fund and/or activities and
expenses related to the distribution of Fund shares. While the Fund pays this
fee to NBMI, NBMI expects to pay most or all of it to pension administrators,
broker-dealers and other financial institutions that make Fund shares available
to investors and/or provide services to the Fund and its shareholders. The fee
paid to a financial institution may be based on the level of such services
provided. In the event that NBMI does not have to pay the entire amount to
institutions, NBMI would use any remaining portion of the fee for distribution
and/or shareholder servicing activities.
The Fund 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 the expenses incurred by it for servicing
or distributing the Fund's shares exceed the fee payable under the Distribution
and Shareholder Services Plan.
The Distribution and Shareholder Services Plan would permit the payment of
compensation for shareholder servicing activities, including but not limited to
the following: (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 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 communication expenses. (See Section 3.B. of the proposed
Plan.)
The Distribution and Shareholder Services Plan would also permit payment of
compensation for distribution-related activities, including but not limited to
compensation for (a) the distribution of shares; (b) overhead and telephone and
communications expenses; (c) the printing of prospectuses, statements of
additional information, and reports for other than existing shareholders; and
- 9 -
<PAGE>
(d) the preparation and distribution of sales literature and advertising
materials. (See Section 3.A. of the proposed Plan.)
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 Board of Trustees of Equity Assets for their review at
least quarterly. In addition, the Plan provides that it may not be amended to
increase materially the costs that the Fund may bear pursuant to it without
approval of the Fund's shareholders, and that other material amendments to the
Plan must be approved by the vote of a majority of the Trustees, 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"), cast in person at a meeting called for the purpose of considering
such amendments. The Distribution and Shareholder Services Plan is subject to
annual approval by the entire Board of Trustees and by the Independent Trustees,
by vote cast in person at a meeting called for the purpose of voting on the
Plan. The Distribution and Shareholder Services Plan is terminable 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 the Rule, the selection and nomination of the Trustees who are
not interested persons of Equity Assets is committed to the discretion of the
then current Trustees who are not interested persons of Equity Assets.
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 the 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, which is attached as
Appendix B to this Proxy Statement. If approved by shareholders, the
Distribution and Shareholder Services Plan will become effective on November 1,
1999 and will remain in effect for one year thereafter, subject to continuation
by the Board of Trustees.
If shareholders of the Fund approve both the Realignment Plan described in
Proposal 1 and the Distribution and Shareholder Services Plan, New Series will
issue one share to NBMI prior to Closing Date; NBMI, as initial sole shareholder
of New Series, will vote to approve the new 12b-1 plan, and then redeem its
share of New Series prior to the Closing Date.
At a meeting held on April 28, 1999, the Trustees of Equity Assets,
including all of the Independent Trustees, approved the Distribution and
Shareholder Services Plan with respect to the Fund's shares.
IMPACT OF THE PROPOSAL. The overall fees and expenses that a Fund
shareholder would bear would be increased under the Proposal. If the Proposal is
approved, the Fund's shares would incur distribution fees of .10% of average
- 10 -
<PAGE>
daily net assets, in addition to the fees and expenses currently applicable. The
following tables compare the management fees, distribution fees, other expenses,
and total fund operating expenses that shareholders of the Fund would bear under
the existing structure with the fees and expenses such shareholders would bear
if they approve the Distribution and Shareholder Services Plan.
As explained in the notes accompanying the tables, the Fund has an
arrangement with NBMI 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, the Fund's total annual operating expenses will be
limited to no more than 0.20% above those of its Sister Fund. This expense
limitation arrangement can be terminated upon 60 days' notice to the Fund.
- 11 -
<PAGE>
NEUBERGER BERMAN SOCIALLY RESPONSIVE TRUST
<TABLE>
<CAPTION>
CURRENT PROPOSED
- ------- --------
FEE TABLE FEE TABLE
<S> <C> <C> <C>
Shareholder fees None Shareholder fees None
Annual operating expenses (% of Annual operating expenses (% of
average net assets)* average net assets)*
These are deducted from fund These are deducted from fund
assets, so you pay them assets, so you pay them
indirectly. indirectly.
Management fees 0.95 Management fees 0.95
Plus: Distribution (12b-1) fees None PLUS: DISTRIBUTION (12B-1) FEES 0.10
Other expenses 1.10 Other expenses 1.10
------- ------
Equals: Total annual 2.05 EQUALS: TOTAL ANNUAL 2.15
operating expenses OPERATING EXPENSES
<FN>
* Neuberger Berman Management * Neuberger Berman Management
reimburses certain expenses of the reimburses certain expenses of
fund so that its total annual the fund so that its total annual
operating expenses are not more than operating expenses are not more
0.10% above those of another than 0.20% above those of another
Neuberger Berman fund that invests Neuberger Berman fund that
in the same portfolio of invests in the same portfolio of
securities. This arrangement does securities. This arrangement
not cover interest, taxes, brokerage does not cover interest, taxes,
commissions, and extraordinary brokerage commissions, and
expenses. Under this arrangement, extraordinary expenses. Under
which Neuberger Berman Management this arrangement, which Neuberger
can terminate upon sixty days' Berman Management can terminate
notice to the fund, total annual upon sixty days' notice to the
operating expenses of the fund last fund, total annual operating
year were limited to 1.20% of the expenses of the fund last year
fund's average net assets. Actual would have been limited to 1.30%
expenses this year may be higher or of the fund's average net
lower. The table includes costs assets. Actual expenses this
paid by the fund and its share of year may be higher or lower. The
master portfolio costs. table includes costs paid by the
fund and its share of master
portfolio costs.
</FN>
</TABLE>
<TABLE>
<CAPTION>
EXPENSE EXAMPLE EXPENSE EXAMPLE
<S> <C>
This example assumes that you invested This example assumes that you
$10,000 for the periods shown, that you invested $10,000 for the periods
earned a hypothetical 5% total return shown, that you earned a
each year, and that the fund's expenses hypothetical 5% total return each
were those in the table above. Your year, and that the fund's expenses
costs would be the same whether you sold were those in the table above.
your shares or continued to hold them at Your costs would be the same
the end of each period. Actual whether you sold your shares or
performance and expenses may be higher continued to hold them at the end
or lower. of each period. Actual performance
and expenses may be higher or lower.
1 3 5 10 1 3 5 10
Year Years Years Years Year Years Years Years
Expenses** $208 $643 $1103 $2379 Expenses** $218 $673 $1154 $2483
<FN>
** Under the fund's expense ** Under the fund's expense
reimbursement arrangement described reimbursement arrangement
in the footnote above, your costs for described in the footnote above,
the one-, three-, five- and ten-year your costs for the one-, three-,
periods would be $122, $381, $660, and five- and ten-year periods would
$1455, respectively. be $132, $412, $713, and $1568,
respectively.
</FN>
</TABLE>
- 12 -
<PAGE>
REASONS FOR THE PROPOSAL. NBMI has recommended Proposal 2 to the Board of
Trustees in light of the expenses associated with providing shareholder
servicing and distribution services to the Fund. NBMI believes that the
distribution and shareholder servicing fee proposed for the Fund is appropriate
to defray a portion of the costs associated with shareholder servicing
activities and to support the marketing of the Fund.
NBMI believes that the compensation practices that prevail among the
entities that make the Fund available to investors justify adopting the
Distribution and Shareholder Services Plan. The Fund relies almost 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 Fund 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 Fund faces increasing costs and must pay
higher 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 Fund's 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
Fund's 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 Fund's 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 Fund available to their clients and maintaining the clients'
assets in the Fund. 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 Fund maintain an effective program to make its shares
available to investors, which is necessary for the Fund to maintain a sufficient
size to spread its fixed costs over a substantial asset base.
Even with the proposed new fee of 0.10% of average daily net assets, total
fund operating expenses for the Fund will remain at or below the mean total
operating expense ratio of comparable funds as represented by its peer group.
- 13 -
<PAGE>
CONSIDERATION AND APPROVAL BY THE BOARD OF TRUSTEES. Before approving the
Distribution and Shareholder Services Plan, the Fund's Trustees were provided
with detailed information relating to it. They considered carefully the factors
described above and consulted with independent counsel.
The Trustees 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 relationship to the overall cost structure of the Fund.
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 Fund's largest holders, the Trustees believe the Fund must meet
the demand for higher fees to maintain its 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 Fund needs 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 Fund's shares available, resulting in
greater growth of the Fund or maintenance of Fund assets at higher levels than
might otherwise be the case. The Trustees recognized that if the Fund
experiences growth as a result of increased shareholder subscriptions (sales of
new shares), it will have greater access to cash for new purchases of
securities, thereby making the Fund easier to manage and maintaining its
viability. The Trustees also recognized that an increase in the Fund's asset
size may result in certain economies of scale. These economies of scale would be
shared by investors in the Fund, both because fixed expenses would be spread
over a larger asset base and because the management fees that the Fund pays
through the Portfolio 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 the 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. In addition, the Fund's total operating expense ratio, taking into
account the proposed distribution fee, will remain in line with the average of
other comparable funds.
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 Fund to NBMI, because such fees are calculated as a
- 14 -
<PAGE>
percentage of the Fund's assets and thus will increase if net assets increase.
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 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 implementation of the
Distribution and Shareholder Services Plan would be in the best interests of the
Fund and its shareholders and would have a reasonable likelihood of benefiting
the 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 the Fund's shareholders vote FOR the Proposal.
THE BOARD UNANIMOUSLY RECOMMENDS THAT FUND SHAREHOLDERS
VOTE "FOR" PROPOSAL 2.
-----------------------------------------------------------
PROPOSAL 3 - RATIFICATION OR REJECTION OF THE SELECTION OF THE INDEPENDENT
ACCOUNTANTS
The Board, including all of the Independent Trustees, has selected
PricewaterhouseCoopers LLP to continue to serve as independent accountants of
the Fund. PricewaterhouseCoopers LLP has no direct financial interest or
material indirect financial interest in the Fund. Representatives of
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 presence.
The independent accountants examine annual financial statements for the
Fund and provide other audit and tax-related services. In recommending the
selection of PricewaterhouseCoopers LLP, the Board reviewed the nature and scope
of the services to be provided (including non-audit services) and whether the
performance of such services would affect the accountants' independence.
THE BOARD UNANIMOUSLY RECOMMENDS THAT FUND SHAREHOLDERS
VOTE "FOR" PROPOSAL 3.
-----------------------------------------------------------
- 15 -
<PAGE>
OTHER INFORMATION
INFORMATION ABOUT NBMI. NBMI, located at 605 Third Avenue, New York, New
York 10158-0180, serves as the Fund's principal underwriter and administrator
and as investment manager to the Portfolio. NBMI manages the Portfolio in
conjunction with Neuberger Berman, LLC, as sub-adviser. Together, the firms
manage more than $57 billion in total assets (as of June 30, 1999) 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
will vote on those matters in accordance with their judgment.
SHAREHOLDER PROPOSALS. Equity Assets does 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 Equity Assets at 605 Third Avenue, New York, New York
10158-0180, such that they will be received by Equity Assets at a reasonable
period of time prior to any such meeting.
NOTICE TO BANKS, BROKER-DEALERS AND VOTING TRUSTEES AND THEIR NOMINEES.
Please advise Equity Assets at 605 Third Avenue, New York, New York 10158-0180,
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.
August 16, 1999
IT IS IMPORTANT THAT THE PROXIES BE RETURNED PROMPTLY. SHAREHOLDERS WHO DO
NOT EXPECT TO ATTEND THE MEETING ARE THEREFORE URGED TO COMPLETE, DATE, SIGN AND
RETURN THE ENCLOSED CARD AS SOON AS POSSIBLE IN THE ENCLOSED ENVELOPE. NO
POSTAGE IS NECESSARY IF IT IS MAILED IN THE UNITED STATES. TO VOTE BY TOUCH-TONE
PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLL-FREE OR VISIT
HTTP://WWW.PROXYVOTE.COM ON THE WORLD WIDE WEB.
- 16 -
<PAGE>
APPENDIX A
----------
AGREEMENT AND PLAN OF REALIGNMENT AND TERMINATION
This AGREEMENT AND PLAN OF REALIGNMENT AND TERMINATION ("Agreement") is
made as of _______ __, 1999, between Neuberger Berman Equity Assets, a Delaware
business trust ("Equity Assets"), on behalf of Neuberger Berman Socially
Responsive Trust, a segregated portfolio of assets ("series") thereof ("Old
Fund"), and Neuberger Berman Equity Trust, a Delaware business trust ("Equity
Trust"), on behalf of its Neuberger Berman Socially Responsive Trust series
("New Fund"). (Old Fund and New Fund are sometimes referred to herein
individually as a "Fund" and collectively as the "Funds"; and Equity Assets and
Equity Trust are sometimes referred to herein individually as an "Investment
Company.") All agreements, representations, actions, and obligations described
herein made or to be taken or undertaken by either Fund are made and shall be
taken or undertaken by Equity Assets on behalf of Old Fund and by Equity Trust
on behalf of New Fund.
Old Fund intends to change its form and identity -- by converting from a
series of one Delaware business trust to a series of another Delaware business
trust -- through a reorganization within the meaning of section 368(a)(1)(F) of
the Internal Revenue Code of 1986, as amended ("Code"). Old Fund desires to
accomplish such conversion by transferring all its assets to New Fund (which is
being established solely for the purpose of acquiring such assets and continuing
Old Fund's business) in exchange solely for voting shares of beneficial interest
in New Fund ("New Fund Shares") and New Fund's assumption of Old Fund's
liabilities, followed by the constructive distribution of the New Fund Shares
PRO RATA to the holders of shares of beneficial interest in Old Fund ("Old Fund
Shares") in exchange therefor, all on the terms and conditions set forth in this
Agreement (which is intended to be, and is adopted as, a "plan of
reorganization" within the meaning of the regulations under section 368 of the
Code ("Regulations")). All such transactions are referred to herein as the
"Reorganization."
In consideration of the mutual promises herein contained, the parties agree
as follows:
1. PLAN OF REALIGNMENT AND TERMINATION
1.1. Old Fund agrees to assign, sell, convey, transfer, and deliver all
of its assets described in paragraph 1.2 ("Assets") to New Fund. New Fund agrees
in exchange therefor --
(a) to issue and deliver to Old Fund the number of full and
fractional (rounded to the third decimal place) New Fund Shares equal to
the number of full and fractional Old Fund Shares then outstanding, and
(b) to assume all of Old Fund's liabilities described in
paragraph 1.3 ("Liabilities"). Such transactions shall take place at the
Closing (as defined in paragraph 2.1).
1.2. The Assets shall include, without limitation, 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 Old Fund's books, and other property owned by Old Fund at the
Effective Time (as defined in paragraph 2.1).
1.3. The Liabilities shall include all of Old Fund's liabilities, debts,
obligations, and duties of whatever kind or nature, whether absolute, accrued,
contingent, or otherwise, whether or not determinable at the Effective Time, and
whether or not specifically referred to in this Agreement.
<PAGE>
1.4. At the Effective Time (or as soon thereafter as is reasonably
practicable), Old Fund shall distribute the New Fund Shares it received pursuant
to paragraph 1.1 to its shareholders of record, determined as of the Effective
Time (each a "Shareholder" and collectively "Shareholders"), in constructive
exchange for their Old Fund Shares. Such distribution shall be accomplished by
Equity Trust's transfer agent's opening accounts on New Fund's share transfer
books in the Shareholders' names and transferring such New 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) New Fund Shares due
that Shareholder. All outstanding Old Fund Shares, including those represented
by certificates, shall simultaneously be canceled on Old Fund's share transfer
books. New Fund shall not issue certificates representing the New Fund Shares in
connection with the Reorganization.
1.5. As soon as reasonably practicable after distribution of the New
Fund Shares pursuant to paragraph 1.4, but in all events within six months after
the Effective Time, Old Fund shall be terminated as a series of Equity Assets
and any further actions shall be taken in connection therewith as required by
applicable law.
1.6. Any reporting responsibility of Old Fund to a public authority is
and shall remain its responsibility up to and including the date on which it is
terminated.
1.7. Any transfer taxes payable on issuance of New Fund Shares in a name
other than that of the registered holder on Old Fund's books of the Old Fund
Shares constructively exchanged therefor shall be paid by the person to whom
such New Fund Shares are to be issued, as a condition of such transfer.
2. CLOSING AND EFFECTIVE TIME
2.1. The Reorganization, together with related acts necessary to
consummate the same ("Closing"), shall occur at the Funds' principal office on
[_______ __, 1999], or at such other place and/or on such other date as to which
the parties 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 parties may agree ("Effective Time").
2.2. 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 Old Fund to New Fund,
as reflected on New Fund's books immediately following the Closing, does or will
conform to such information on Old Fund's books immediately before the Closing.
Equity Assets' custodian shall deliver at the Closing a certificate of an
authorized officer stating that (a) the Assets held by the custodian will be
transferred to New 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.
2.3. Equity Trust's transfer agent shall deliver at the Closing a
certificate as to the opening on New Fund's share transfer books of accounts in
the Shareholders' names. Equity Trust shall issue and deliver a confirmation to
Equity Assets evidencing the New Fund Shares to be credited to Old Fund at the
Effective Time or provide evidence satisfactory to Equity Assets that such New
Fund Shares have been credited to Old Fund's account on such books. At the
Closing, each party shall deliver to the other such bills of sale, checks,
assignments, stock certificates, receipts, or other documents as the other party
or its counsel may reasonably request.
2.4. Each Investment Company shall deliver to the other at the Closing a
certificate executed in its name by its President or a Vice President in form
- 2 -
<PAGE>
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.
3. REPRESENTATIONS AND WARRANTIES
3.1. Old Fund represents and warrants as follows:
3.1.1. Equity Assets is a business trust duly organized, validly
existing, and in good standing under the laws of the State of Delaware; and
a copy of its Certificate of Trust has been duly filed in the office of the
Secretary of State thereof;
3.1.2. Equity Assets is duly registered as an open-end management
investment company under the Investment Company Act of 1940, as amended
("1940 Act"), and such registration will be in full force and effect at the
Effective Time;
3.1.3. Old Fund is a duly established and designated series of Equity
Assets;
3.1.4. At the Closing, Old Fund 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 upon
delivery and payment for the Assets, New Fund will acquire good and
marketable title thereto;
3.1.5. New Fund Shares are not being acquired for the purpose of making
any distribution thereof, other than in accordance with the terms hereof;
3.1.6. Old Fund 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
such qualification for its current taxable year (and the Assets will be
invested at all times through the Effective Time in a manner that ensures
compliance with the foregoing); and it has no earnings and profits
accumulated in any taxable year in which the provisions of Subchapter M did
not apply to it;
3.1.7. The Liabilities were incurred by Old Fund in the ordinary
course of its business and are associated with the Assets;
3.1.8. Old Fund is not under the jurisdiction of a court in a
proceeding under Title 11 of the United States Code or similar case within
the meaning of section 368(a)(3)(A) of the Code;
3.1.9. Not more than 25% of the value of Old Fund's total assets
(excluding cash, cash items, and U.S. government securities) is invested in
the stock and securities of any one issuer, and not more than 50% of the
value of such assets is invested in the stock and securities of five or
fewer issuers;
3.1.10. As of the Effective Time, Old Fund will not have outstanding
any warrants, options, convertible securities, or any other type of rights
pursuant to which any person could acquire Old Fund Shares; and
3.1.11. As of the Effective Time, the performance of this Agreement
shall have been duly authorized by all necessary action by Old Fund's
shareholders. 3.2.New Fund represents and warrants as follows:
3.2.1. Equity Trust is a business trust duly organized, validly
existing, and in good standing under the laws of the State of Delaware; and
a copy of its Certificate of Trust has been duly filed in the office of the
Secretary of State thereof;
3.2.2. Equity Trust is duly registered as an open-end management
- 3 -
<PAGE>
investment company under the 1940 Act, and such registration will be in
full force and effect at the Effective Time;
3.2.3. Before the Effective Time, New Fund will be a duly established
and designated series of Equity Trust;
3.2.4. New Fund has not commenced operations and will not do so until
after the Closing;
3.2.5. Before the Effective Time, there will be no issued and
outstanding shares in New Fund or any other securities issued by New Fund,
except as provided in paragraph 4.4;
3.2.6. No consideration other than New Fund Shares (and New Fund's
assumption of the Liabilities) will be issued in exchange for the Assets in
the Reorganization;
3.2.7. The New Fund Shares to be issued and delivered to Old Fund
hereunder will have been duly authorized at the Effective Time and, when
issued and delivered as provided herein, will be duly and validly issued
and outstanding shares of New Fund, fully paid and non-assessable;
3.2.8. New Fund will be a "fund" as defined in section 851(g)(2) of the
Code and will meet all the requirements to qualify for treatment as a RIC
for its taxable year in which the Reorganization occurs;
3.2.9. New Fund has no plan or intention to issue additional New 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 New Fund have any plan or intention to redeem or
otherwise reacquire any New 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 net asset value in
the ordinary course of that business;
3.2.10. Following the Reorganization, New Fund (a) will continue Old
Fund's "historic business" (within the meaning of section 1.368-1(d)(2) of
the Regulations), (b) use a significant portion of Old Fund's historic
business assets (within the meaning of section 1.368-1(d)(3) of the
Regulations) in a business, (c) 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, and (d) expects to retain substantially all the Assets in
the same form as it receives them in the Reorganization, unless and until
subsequent investment circumstances suggest the desirability of change or
it becomes necessary to make dispositions thereof to maintain such status;
3.2.11. There is no plan or intention for New 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; and
3.2.12. Immediately after the Reorganization, (a) not more than 25% of
the value of New Fund's total assets (excluding cash, cash items, and U.S.
government securities) will be invested in the stock and securities of any
one issuer and (b) not more than 50% of the value of such assets will be
invested in the stock and securities of five or fewer issuers.
3.3. Each Fund represents and warrants as follows:
3.3.1. The fair market value of the New Fund Shares received by each
Shareholder will be approximately equal to the fair market value of the Old
Fund Shares constructively surrendered in exchange therefor;
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<PAGE>
3.3.2. Its management --
(a) is unaware of any plan or intention of Shareholders to redeem,
sell, or otherwise dispose of (i) any portion of their Old Fund 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 New Fund Shares to be received by them in the
Reorganization to any person related (as so defined) to New Fund and
(b) anticipates that (i) dispositions of those New Fund Shares at
the time of or soon after the Reorganization will not exceed the usual
rate and frequency of dispositions of shares of Old Fund as a series of
an open-end investment company, (ii) 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 (iii) there will not
be extraordinary redemptions of New Fund Shares immediately following
the Reorganization;
3.3.3. The Shareholders will pay their own expenses, if any, incurred
in connection with the Reorganization;
3.3.4. Immediately following consummation of the Reorganization, the
Shareholders will own all the New Fund Shares and will own such shares
solely by reason of their ownership of Old Fund Shares immediately before
the Reorganization;
3.3.5. Immediately following consummation of the Reorganization, New
Fund will hold the same assets -- except for assets distributed to
shareholders in the course of its business as a RIC and assets used to pay
expenses incurred in connection with the Reorganization -- and be subject
to the same liabilities that Old Fund held or was subject to immediately
prior to the Reorganization, plus any liabilities for expenses of the
parties incurred in connection with the Reorganization. Such excepted
assets, together with the amount of all redemptions and distributions
(other than regular, normal dividends) made by Old Fund immediately
preceding the Reorganization, will, in the aggregate, constitute less than
1% of its net assets;
3.3.6. There is no intercompany indebtedness between the Funds that
was issued or acquired, or will be settled, at a discount; and
3.3.7. 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) ("Reorganization Expenses").
4. CONDITIONS PRECEDENT
Each Fund's obligations hereunder shall be subject to (a) performance by
the other Fund 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 further conditions that, at or before
the Effective Time:
4.1. This Agreement and the transactions contemplated hereby shall have
been duly adopted and approved by each Investment Company's board of trustees
(each, a "board") and shall have been approved by Old Fund's shareholders in
accordance with applicable law;
4.2. All necessary filings shall have been made with the Securities and
Exchange Commission ("SEC") and state securities authorities, and no order or
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<PAGE>
directive shall have been received that any other or further action is required
to permit the parties to carry out the transactions contemplated hereby. 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 the assets or properties of either Fund, provided that either
Investment Company may for itself waive any of such conditions;
4.3. Each Investment Company shall have received an opinion of Kirkpatrick
& Lockhart LLP, addressed to and in form and substance satisfactory to it, as to
the federal income tax consequences mentioned below ("Tax Opinion"). In
rendering the Tax Opinion, such counsel may rely as to factual matters,
exclusively and without independent verification, on the representations made in
this Agreement (or in separate letters addressed to such counsel) and the
certificates delivered pursuant to paragraph 2.4. 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:
4.3.1. New Fund's acquisition of the Assets in exchange solely for New
Fund Shares and New Fund's assumption of the Liabilities, followed by Old
Fund's distribution of those shares PRO RATA to the Shareholders
constructively in exchange for the Shareholders' Old Fund Shares, will
qualify as a reorganization within the meaning of section 368(a)(1)(F) of
the Code, and each Fund will be "a party to a reorganization" within the
meaning of section 368(b) of the Code;
4.3.2. Old Fund will recognize no gain or loss on the transfer of the
Assets to New Fund in exchange solely for New Fund Shares and New Fund's
assumption of the Liabilities or on the subsequent distribution of those
shares to the Shareholders in constructive exchange for their Old Fund
Shares;
4.3.3. New Fund will recognize no gain or loss on its receipt of the
Assets in exchange solely for New Fund Shares and its assumption of the
Liabilities;
4.3.4. New Fund's basis for the Assets will be the same as the basis
therefor in Old Fund's hands immediately before the Reorganization, and New
Fund's holding period for the Assets will include Old Fund's holding period
therefor;
4.3.5. A Shareholder will recognize no gain or loss on the constructive
exchange of all its Old Fund Shares solely for New Fund Shares pursuant to
the Reorganization;
4.3.6. A Shareholder's aggregate basis for the New Fund Shares to be
received by it in the Reorganization will be the same as the aggregate
basis for its Old Fund Shares to be constructively surrendered in exchange
for those New Fund Shares, and its holding period for those New Fund Shares
will include its holding period for those Old Fund Shares, provided they
are held as capital assets by the Shareholder at the Effective Time; and
4.3.7. For purposes of section 381 of the Code, New Fund will be
treated as if there had been no Reorganization. Accordingly, the
Reorganization will not result in the termination of Old Fund's taxable
year, Old Fund's tax attributes enumerated in section 381(c) of the Code
will be taken into account by New Fund as if there had been no
Reorganization, and the part of Old Fund's taxable year before the
Reorganization will be included in New Fund's taxable year after the
Reorganization.
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<PAGE>
Notwithstanding subparagraphs 4.3.2 and 4.3.4, 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 on the termination or
transfer thereof under a mark-to-market system of accounting;
4.4. Equity Trust (on behalf of and with respect to New Fund) shall have
entered into any agreements necessary for New Fund's operation as a series of an
open-end investment company. Each such agreement shall have been approved by
Equity Trust's trustees and, to the extent required by law, by such of those
trustees who are not "interested persons" (as defined in the 1940 Act) thereof.
Prior to the Closing Date, the New Fund will issue one share to NBMI against
payment of $10.00. The New 12b-1 Plan shall have been approved by NBMI as the
sole initial sole shareholder of the New Fund; subsequent to said vote and
before the Closing Date, NBMI shall redeem its share of the New Fund, and
4.5. The Agreement and Plan of Realignment and Termination of even date
herewith (substantially similar to this Agreement) ("Similar Agreement")
providing for the conversion of Neuberger Berman NYCDC Socially Responsive Trust
from a series of Equity Trust to a series of Neuberger Berman Equity Series, a
Delaware business trust registered as an open-end management investment company
under the 1940 Act ("Equity Series"), and the Similar Agreement providing for
the conversion of Neuberger Berman Socially Responsive Assets from a series of
Equity Series to a series of Equity Assets, and the transactions contemplated
thereby, shall have been duly adopted and approved by the respective investment
companies' boards of trustees and shall have been approved by the respective
converting funds' shareholders in accordance with applicable law.
At any time before the Closing, either Investment Company may waive any of
the foregoing conditions (except those set forth in paragraphs 4.1 and 4,5) if,
in the judgment of its board, such waiver will not have a material adverse
effect on its Fund's shareholders' interests.
5. BROKERAGE FEES AND EXPENSES
5.1. 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.
5.2. Except as otherwise provided herein, [50% of the Reorganization
Expenses shall be borne by Neuberger Berman Management Incorporated and the
balance shall be borne by the Funds in a mutually agreed manner].
6. 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.
7. TERMINATION
This Agreement may be terminated at any time at or before the Effective
Time, whether before or after approval by Old Fund's shareholders:
7.1. 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, 1999?]; or
7.2. By the parties' mutual agreement.
In the event of termination under paragraphs 7.1(c) or 7.2, 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.
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<PAGE>
8. AMENDMENT
This Agreement may be amended, modified, or supplemented at any time,
notwithstanding approval thereof by Old Fund's shareholders, in any manner
mutually agreed upon by the parties; provided that following such approval, no
such amendment shall have a material adverse effect on the Shareholders'
interests.
9. MISCELLANEOUS
9.1. 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 such laws and the federal securities laws, the latter shall
govern.
9.2. Nothing expressed or implied herein is intended or shall be construed
to confer upon 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.
9.3. 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 hereto. 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.
9.4. The execution and delivery of this Agreement have been authorized by
each Investment Company's trustees, and this Agreement has been executed and
delivered by their respective authorized officers acting as such; neither such
authorization by such trustees nor such execution and delivery by such officers
shall be deemed to have been made by any of them individually or to impose any
liability on any of them or any shareholder of either Investment Company
personally, but shall bind only the assets and property of the respective Funds,
as provided in each Investment Company's Declaration of Trust.
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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 ASSETS,
on behalf of its series,
Neuberger Berman Socially Responsive Trust
____________________ By: ____________________
Secretary President
ATTEST: NEUBERGER BERMAN EQUITY TRUST,
on behalf of its series,
Neuberger Berman Socially Responsive Trust
____________________ By: ____________________
Secretary President
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<PAGE>
APPENDIX B
----------
NEUBERGER BERMAN EQUITY TRUST
DISTRIBUTION AND SHAREHOLDER SERVICES PLAN
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 Distribution and Shareholder
Services ("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
<PAGE>
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.
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 __________ 1999 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.
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<PAGE>
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.
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<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:
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<PAGE>
NEUBERGER BERMAN EQUITY TRUST
DISTRIBUTION AND SHAREHOLDER SERVICES PLAN
SCHEDULE A
The series of Neuberger Berman Equity Trust subject to the Distribution and
Shareholder Services Plan, and the applicable fee rates, are:
Fee (as a Percentage of
Series Average Daily Net Assets)
Neuberger Berman Focus Trust 0.10%
Neuberger Berman Genesis Trust 0.10%
Neuberger Berman Guardian Trust 0.10%
Neuberger Berman International Trust 0.10%
Neuberger Berman Manhattan Trust 0.10%
Neuberger Berman Millennium Trust 0.10%
Neuberger Berman Partners Trust 0.10%
NEUBERGER BERMAN SOCIALLY RESPONSIVE TRUST 0.10%
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<PAGE>
[Name and Address]
NEUBERGER BERMAN SOCIALLY RESPONSIVE TRUST
NEUBERGER BERMAN EQUITY ASSETS
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
OCTOBER 15, 1999
This proxy is being solicited on behalf of the Board of Trustees of
Neuberger Berman Equity Assets ("Company") and relates to the proposals with
respect to the Company, on behalf of Neuberger Berman Socially Responsive Trust,
a series of the Company ("Fund"). The undersigned appoints as proxies Lawrence
Zicklin, Michael J. Weiner and Claudia A. Brandon and each of them (with power
of substitution), to vote all the undersigned's shares of beneficial interest in
the Fund at the Special Meeting of Shareholders to be held at 10:00 a.m.,
Eastern time, on October 15, 1999, at the offices of the Company, 605 Third
Avenue, 2nd Floor, New York, NY 10158-0180, 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 relating to the Fund with 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 BELOW AND RETURN IT
PROMPTLY IN THE ENCLOSED ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL [1-800-690-6903]
TOLL-FREE OR VISIT WWW.PROXYVOTE.COM.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
[X] KEEP THIS PORTION FOR YOUR RECORDS
<PAGE>
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
NEUBERGER BERMAN SOCIALLY RESPONSIVE TRUST
NEUBERGER BERMAN EQUITY ASSETS
VOTE ON PROPOSALS FOR AGAINST ABSTAIN
1. Approval of an Agreement and Plan ___ ___ ___
of Realignment and Termination
providing for the conversion of the
Fund from a series of the Company
to a separate series of Neuberger
Berman Equity Trust.
2. Approval of a Distribution and ___ ___ ___
Shareholder Services Plan to
authorize the Fund to spend
annually 0.10% of average daily net
assets to pay for distribution
and/or shareholder servicing
expenses.
3. Ratification of the selection of ___ ___ ___
PricewaterhouseCoopers LLP as the
Fund's Independent Accountants.
4. To consider and vote upon such ___ ___ ___
other matters as may properly come
before the meeting or any
adjournments thereof.
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 BELOW AND RETURN IT
PROMPTLY IN THE ENCLOSED ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE, PLEASE CALL [1-800-690-6903] TOLL-FREE. TO VOTE BY
INTERNET, VISIT OUR WEBSITE AT WWW.PROXYVOTE.COM.
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.
- ---------------------------------------------------- ---------------------------
Signature (owner, trustee, custodian, etc.) Date
- ---------------------------------------------------- ---------------------------
Signature (owner, trustee, custodian, etc.) Date
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