NEUBERGER BERMAN EQUITY ASSETS, 485BPOS, 1999-12-01

NEUBERGER BERMAN EQUITY ASSETS
485BPOS, 1999-12-01

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As filed with the Securities and Exchange Commission on November 30, 1999
1933 Act Registration No. 33-82568
1940 Act Registration No. 811-8106

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ X ]

Pre-Effective Amendment No. [ ] [ ]

Post-Effective Amendment No. [17] [ X ]

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ X ]

Amendment No. [19] [ X ]

(Check appropriate box or boxes)

NEUBERGER BERMAN EQUITY ASSETS
(Exact Name of the Registrant as Specified in Charter)
605 Third Avenue, 2nd Floor
New York, New York 10158-0180
(Address of Principal Executive Offices)

Registrant's Telephone Number, including area code: (212) 476-8800

Michael M. Kassen, President
Neuberger Berman Equity Assets
605 Third Avenue, 2nd Floor
New York, New York 10158-0180

Arthur C. Delibert, Esq.
Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, N.W., 2nd Floor
Washington, D.C. 20036-1800
(Names and Addresses of agents for service)

Approximate Date of Proposed Public Offering: Continuous

It is proposed that this filing will become effective:

[ ] immediately upon filing pursuant to paragraph (b)
[ X ] on December 1, 1999 pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] on pursuant to paragraph (a)(1)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] on ________________ pursuant to paragraph (a)(2)

Neuberger Berman Equity Assets is a "master/feeder fund." This
Post-Effective Amendment No. 17 includes a signature page for the master fund,
Equity Managers Trust, and appropriate officers and trustees thereof.

<PAGE>

NEUBERGER BERMAN EQUITY ASSETS

CONTENTS OF POST-EFFECTIVE AMENDMENT NO. 17 ON FORM N-1A

This Post-Effective Amendment consists of the following papers and documents:

Cover Sheet

Contents of Post-Effective Amendment No. 17 on Form N-1A

Neuberger Berman Focus Assets

Neuberger Berman Genesis Assets

Neuberger Berman Guardian Assets

Neuberger Berman Manhattan Assets

Neuberger Berman Millennium Assets

Neuberger Berman Partners Assets

Part A - Prospectus

Part B - Statement of Additional Information

Part C - Other Information

Signature Pages

Exhibit Index

<PAGE>

<PAGE>
[PHOTO] NEUBERGER BERMAN

NEUBERGER BERMAN
EQUITY ASSETS-REGISTERED TRADEMARK-
- --------------------------------------------------------------------------------
PROSPECTUS DECEMBER 1, 1999

These securities, like the securities of all mutual
funds, have not been approved or disapproved by the
Securities and Exchange Commission and the Securities
and Exchange Commission has not determined if this
prospectus is accurate or complete. Any representation
to the contrary is a criminal offense.

Focus Assets
Genesis Assets
Guardian Assets
Manhattan Assets
Millennium Assets
Partners Assets
<PAGE>
CONTENTS
- -----------------

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

PAGE 2 ...... Focus Assets

8 ...... Genesis Assets

14 ...... Guardian Assets

20 ...... Manhattan Assets

26 ...... Millennium Assets

30 ...... Partners Assets

YOUR INVESTMENT

42 ...... Maintaining Your Account

44 ...... Share Prices

45 ...... Distributions and Taxes

47 ...... Fund Structure
</TABLE>

The "Neuberger Berman" name and logo are service
marks of Neuberger Berman, LLC. "Neuberger Berman
Management Inc." and the individual fund names in
this prospectus are either service marks or
registered trademarks of Neuberger Berman
Management Inc. -C-1999 Neuberger Berman Management
Inc.
<PAGE>
- ------------------------------------------------------------

FUND MANAGEMENT

Each series of Neuberger Berman Equity Assets is managed by Neuberger Berman
Management Inc., in conjunction with Neuberger Berman, LLC, as sub-adviser.
Together, the firms manage more than $51.3 billion in total assets (as of
September 30, 1999) and continue an asset management history that began in 1939.

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

THESE FUNDS:

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

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

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

- - USE A MASTER/FEEDER STRUCTURE IN THEIR PORTFOLIOS; SEE PAGE 47 FOR INFORMATION
ON HOW IT WORKS

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

- - ARE MUTUAL FUNDS, NOT BANK DEPOSITS, AND ARE NOT GUARANTEED OR INSURED BY THE
FDIC OR ANY OTHER GOVERNMENT AGENCY

1
<PAGE>
[PHOTO]

NEUBERGER BERMAN
FOCUS ASSETS
- --------------------------------------------------------------------------------

<TABLE>
<C> <S>
Ticker Symbol: NBFAX ABOVE: PORTFOLIO MANAGER KENT C. SIMONS
</TABLE>

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

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

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

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

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

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

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

- - autos and housing

- - consumer goods and services

- - defense and aerospace

- - energy

- - financial services

- - health care

- - heavy industry

- - machinery and equipment

- - media and entertainment

- - retailing

- - technology

- - transportation

- - utilities

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

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

When a stock no longer meets the fund's investment criteria, the manager will
consider selling it.

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

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

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

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

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

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

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

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

To the extent that the fund emphasizes a particular market capitalization, it
takes on the associated risks. Mid- and small-cap stocks tend to be more
volatile than large-cap stocks. At any given time, any one of these market
capitalizations may be out of favor with investors. If the fund emphasizes that
market capitalization, it could perform worse than certain other funds.

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

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

As a frame of reference, the table includes broad-based indices of the entire
U.S. equity market and of the portion of the market the fund focuses on. The
fund's performance figures include all of its expenses; the indices do not
include costs of investment.

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

[ICON] The charts below provide an indication of
the risks of investing in the fund. The bar chart shows how
performance has varied from year to year. The table below the chart
shows what the returns would equal if you averaged out actual performance over
various lengths of time and compares the return with that of a broad measure of
market performance. This information is based on past performance; it's not a
prediction of future results.

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

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
1989 29.78%
'90 -5.92%
'91 24.66%
'92 21.10%
'93 16.33%
'94 0.87%
'95 36.19%
'96 16.10%
'97 23.42%
'98 17.56%
BEST
QUARTER:
Q4 '98,
up
40.19%
WORST
QUARTER:
Q3 '98,
down
27.62%
Year-to-date
performance
as of
9/30/99:
down 0.76%
</TABLE>

AVERAGE ANNUAL TOTAL % RETURNS as of 12/31/98*

<TABLE>
<CAPTION>
1 Year 5 Years 10 Years
- ------------------------------------------------------------
<S> <C> <C> <C>
FOCUS ASSETS 17.56 18.27 17.37
S&P 500 Index 28.52 24.02 19.16
Russell 1000 Value Index 15.63 20.86 17.38
</TABLE>

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

The Russell 1000 Value Index is an unmanaged index of U.S. mid- and large-cap
value stocks.

* THE FUND BEGAN OPERATING IN SEPTEMBER 1996. PERFORMANCE RESULTS FROM 1989 TO
SEPTEMBER 1996 ARE ACTUALLY THOSE OF ANOTHER NEUBERGER BERMAN FUND THAT BEGAN
OPERATIONS IN 1955, AND INVESTS IN THE SAME PORTFOLIO OF SECURITIES. BECAUSE
THE OLDER FUND HAD MODERATELY LOWER EXPENSES, ITS PERFORMANCE TYPICALLY SHOULD
BE SLIGHTLY BETTER THAN FOCUS ASSETS WOULD HAVE HAD. THAT OLDER FUND IS NOT
OFFERED IN THIS PROSPECTUS.

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

MANAGEMENT

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

NEUBERGER BERMAN MANAGEMENT is the fund's investment manager, administrator, and
distributor. It engages Neuberger Berman, LLC as sub-adviser to provide
management and related services. For the 12 months ended 8/31/99, the
management/administration fees paid to Neuberger Berman Management were 0.89% of
average net assets.

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

FEE TABLE

SHAREHOLDER FEES None
- -------------------------------------------------------

ANNUAL OPERATING EXPENSES (% of average net assets)*

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

<TABLE>
<S> <C> <C>
Management fees 0.89
PLUS: Distribution (12b-1) fees 0.25
Other expenses 5.94
.......
EQUALS: Total annual operating expenses 7.08
MINUS: Expense reimbursement** 5.58
.......
EQUALS: Net expenses 1.50
</TABLE>

* THE TABLE INCLUDES COSTS PAID BY THE FUND AND ITS SHARE OF MASTER PORTFOLIO
COSTS. FOR MORE INFORMATION ON MASTER/FEEDER FUNDS, SEE "FUND STRUCTURE" ON
PAGE 47.

** NEUBERGER BERMAN MANAGEMENT HAS CONTRACTUALLY AGREED TO REIMBURSE CERTAIN
EXPENSES OF THE FUND THROUGH 12/31/09, SO THAT THE TOTAL ANNUAL OPERATING
EXPENSES OF THE FUND ARE LIMITED TO 1.50% OF AVERAGE NET ASSETS. THIS
ARRANGEMENT DOES NOT COVER INTEREST, TAXES, BROKERAGE COMMISSIONS, AND
EXTRAORDINARY EXPENSES.

EXPENSE EXAMPLE

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

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
- ----------------------------------------------------------------
<S> <C> <C> <C> <C>
Expenses $153 $474 $818 $1791
</TABLE>

6 Neuberger Berman
<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
Year Ended August 31, 1997(1) 1998 1999
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PER-SHARE DATA ($)
Data apply to a single share throughout each year indicated. You can see what the fund earned (or lost), what it distributed
to investors, and how its share price changed.
Share price (NAV) at beginning of year 10.00 14.34 11.31
PLUS: Income from investment operations
Net investment loss (0.05) (0.03) (0.08)
Net gains/losses -- realized and unrealized 4.39 (2.42) 4.96
Subtotal: income from investment operations 4.34 (2.45) 4.88
MINUS: Distributions to shareholders
Capital gain distributions -- 0.58 0.01
Subtotal: distributions to shareholders -- 0.58 0.01
.....................................................
EQUALS: Share price (NAV) at end of year 14.34 11.31 16.18
- ------------------------------------------------------------------------------------------------------------------------------
RATIOS (% of average net assets)
The ratios show the fund's expenses and net investment loss -- as they actually are as well as how they would have been if
certain expense reimbursement and offset arrangements had not been in effect.
Net expenses -- actual 1.50(2) 1.50 1.50
Gross expenses(3) 76.74(2) 28.01 7.08
Expenses(4) 1.50(2) 1.50 1.50
Net investment loss -- actual (0.43)(2) (0.36) (0.58)
- ------------------------------------------------------------------------------------------------------------------------------
OTHER DATA
Total return shows how an investment in the fund would have performed over each year, assuming all distributions were
reinvested. The turnover rate reflects how actively the fund bought and sold securities.
Total return(6) (%) 43.40(5) (17.73) 43.15
Net assets at end of year (in millions of dollars) 0.1 0.5 1.9
Portfolio turnover rate (%) 63 64 57
</TABLE>

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

(1) PERIOD FROM 9/4/96 (BEGINNING OF OPERATIONS) TO 8/31/97.

(2) ANNUALIZED.

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

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

(5) NOT ANNUALIZED.

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

Focus Assets 7
<PAGE>
[PHOTO]

NEUBERGER BERMAN
GENESIS ASSETS
- --------------------------------------------------------------------------------

<TABLE>
<C> <S>
Ticker Symbol: NBGAX ABOVE: PORTFOLIO MANAGERS ROBERT W. D'ALELIO AND JUDITH M.
VALE
</TABLE>

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

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

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

VALUE INVESTING

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

[ICON]
THE FUND SEEKS GROWTH OF CAPITAL.

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

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

- - above-average returns

- - an established market niche

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

- - the ability to finance their own growth

- - sound future business prospects

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

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

When a stock no longer meets the fund's investment criteria, the managers will
consider selling it.

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

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

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

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

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

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

- - underperform other types of stocks or be difficult to sell when the economy is
not robust, during market downturns, or when small-cap stocks are out of favor

- - be more affected than other types of stocks by the underperformance of a
sector that the managers decided to emphasize

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

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

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

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

[ICON]

The charts below provide an indication of the risks of investing in
the fund. The bar chart shows how performance has varied from year to
year. The table below the chart shows what the returns would equal if you
averaged out actual performance over various lengths of time and compares the
return with that of a broad measure of market performance. This information is
based on past performance; it's not a prediction of future results.

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

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
1989 17.25%
'90 -16.24%
'91 41.55%
'92 15.62%
'93 13.89%
'94 -1.82%
'95 27.31%
'96 29.86%
'97 34.74%
'98 -7.21%
BEST
QUARTER:
Q1 '91,
up
25.05%
WORST
QUARTER:
Q3 '90,
down
21.81%
Year-to-date
performance
as of
9/30/99:
down 4.02%
</TABLE>

AVERAGE ANNUAL TOTAL % RETURNS as of 12/31/98*

<TABLE>
<CAPTION>
1 Year 5 Years 10 Years
- ----------------------------------------------------------------------
<S> <C> <C> <C>
GENESIS ASSETS (7.21) 15.21 14.02
Russell 2000 Index (2.55) 11.87 12.92
</TABLE>

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

* THE FUND BEGAN OPERATING IN APRIL 1997. PERFORMANCE RESULTS FROM 1989 TO APRIL
1997 ARE ACTUALLY THOSE OF ANOTHER NEUBERGER BERMAN THAT INVESTS IN THE SAME
PORTFOLIO OF SECURITIES. BECAUSE THE OLDER FUND HAD MODERATELY LOWER EXPENSES,
ITS PERFORMANCE TYPICALLY SHOULD BE SLIGHTLY BETTER THAN GENESIS ASSETS WOULD
HAVE HAD. THAT OLDER FUND IS NOT OFFERED IN THIS PROSPECTUS.

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

MANAGEMENT

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

FEE TABLE

SHAREHOLDER FEES None
- -------------------------------------------------------

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

<TABLE>
<S> <C> <C>
Management fees 1.12
PLUS: Distribution (12b-1) fees 0.25
Other expenses 0.26
....
EQUALS: Total annual operating expenses 1.63
MINUS: Expense reimbursement** 0.13
....
EQUALS: Net expenses 1.50
</TABLE>

* THE TABLE INCLUDES COSTS PAID BY THE FUND AND ITS SHARE OF MASTER PORTFOLIO
COSTS. FOR MORE INFORMATION ON MASTER/FEEDER FUNDS, SEE "FUND STRUCTURE" ON
PAGE 47.

EXPENSE EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
- ----------------------------------------------------------------
<S> <C> <C> <C> <C>
Expenses $153 $474 $818 $1791
</TABLE>

12 Neuberger Berman
<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
Year Ended August 31, 1997(1) 1998 1999
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PER-SHARE DATA ($)
Data apply to a single share throughout each year indicated. You can see what the fund earned (or lost), what it
distributed to investors, and how its share price changed.
Share price (NAV) at beginning of year 10.00 13.21 10.67
PLUS: Income from investment operations
Net investment income (loss) (0.01) 0.02 0.01
Net gains/losses -- realized and unrealized 3.22 (2.52) 1.99
Subtotal: income from investment operations 3.21 (2.50) 2.00
MINUS: Distributions to shareholders
Income dividends -- -- 0.03
Capital gain distributions -- 0.04 --
Subtotal: distributions to shareholders -- 0.04 0.03
..................................................
EQUALS: Share price (NAV) at end of year 13.21 10.67 12.64
- -------------------------------------------------------------------------------------------------------------------------
RATIOS (% of average net assets)
The ratios show the fund's expenses and net investment income (loss) -- as they actually are as well as how they would
have been if certain expense reimbursement/waiver and offset arrangements had not been in effect.
Net expenses -- actual 1.50(2) 1.50 1.50
Gross expenses(3) 25.91(2) 2.40 1.63
Expenses(4) 1.50(2) 1.50 1.50
Net investment income (loss) -- actual (0.36)(2) 0.60 0.16
- -------------------------------------------------------------------------------------------------------------------------
OTHER DATA
Total return shows how an investment in the fund would have performed over each year, assuming all distributions were
reinvested. The turnover rate reflects how actively the fund bought and sold securities.
Total return(6) (%) 32.10(5) (18.99) 18.75
Net assets at end of year (in millions of dollars) 0.7 24.5 81.8
Portfolio turnover rate (%) 18 18 33
</TABLE>

(1) PERIOD FROM 4/2/97 (BEGINNING OF OPERATIONS) TO 8/31/97.

(2) ANNUALIZED.

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

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

(5) NOT ANNUALIZED.

(6) WOULD HAVE BEEN LOWER IF NEUBERGER BERMAN MANAGEMENT HAD NOT REIMBURSED
CERTAIN EXPENSES AND/OR WAIVED A PORTION OF THE MANAGEMENT FEE.

Genesis Assets 13
<PAGE>
[PHOTO]

NEUBERGER BERMAN
GUARDIAN ASSETS
- --------------------------------------------------------------------------------

<TABLE>
<C> <S>
Ticker Symbol: NBGUX ABOVE: PORTFOLIO MANAGERS KEVIN L. RISEN AND ALLAN "RICK"
WHITE
</TABLE>

"WE LOOK FOR ESTABLISHED COMPANIES WHOSE INSTRINSIC VALUE, BY OUR MEASURE, HAS
YET TO BE DISCOVERED BY THE MAJORITY OF INVESTORS. IN MANAGING OVERALL RISK, WE
MAKE A CONSCIOUS EFFORT TO DETERMINE THE RISK/REWARD SCENARIO OF EACH INDIVIDUAL
HOLDING AS WELL AS ITS IMPACT AT THE PORTFOLIO LEVEL."

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

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

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

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

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

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

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

- - solid balance sheets

- - above-average returns

- - low valuation measures, such as price-to-earnings ratios

- - strong competitive positions

When a stock no longer meets the fund's investment criteria, the managers will
consider selling it.

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

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

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

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

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

At times, large-cap stocks may lag other types of stocks in performance, which
could cause the fund to perform worse than certain other funds over a given time
period.

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

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

As a frame of reference, the table includes broad-based indicies of the entire
U.S. equity market and of the portion of the market the fund focuses on. The
fund's performance figures include all of its expenses; the indicies do not
include costs of investment.

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

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
'1989 21.50%
'90 -4.71%
'91 34.33%
'92 19.01%
'93 14.45%
'94 0.60%
'95 32.11%
'96 17.59%
'97 17.10%
'98 1.67%
BEST
QUARTER:
Q4 '98,
up
22.98%
WORST
QUARTER:
Q3 '98,
down
26.34%
Year-to-date
performance
as of
9/30/99:
down 3.81%
</TABLE>

AVERAGE ANNUAL TOTAL % RETURNS as of 12/31/98*

<TABLE>
<CAPTION>
1 Year 5 Years 10 Years
- ------------------------------------------------------------
<S> <C> <C> <C>
GUARDIAN ASSETS 1.67 13.22 14.70
S&P 500 Index 28.52 24.02 19.16
Russell 1000 Value Index 15.63 20.86 17.38
</TABLE>

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

The Russell 1000 Value Index is an unmanaged index of U.S. mid- and large-cap
value stocks.

* THE FUND BEGAN OPERATING IN SEPTEMBER 1996. PERFORMANCE RESULTS FROM 1989 TO
SEPTEMBER 1996 ARE ACTUALLY THOSE OF ANOTHER NEUBERGER BERMAN FUND THAT BEGAN
OPERATIONS IN 1950, AND INVESTS IN THE SAME PORTFOLIO OF SECURITIES. BECAUSE
THE OLDER FUND HAD MODERATELY LOWER EXPENSES, ITS PERFORMANCE TYPICALLY SHOULD
BE SLIGHTLY BETTER THAN GUARDIAN ASSETS WOULD HAVE HAD. THAT OLDER FUND IS NOT
OFFERED IN THIS PROSPECTUS.

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

MANAGEMENT

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

NEUBERGER BERMAN MANAGEMENT is the fund's investment manager, administrator, and
distributor. It engages Neuberger Berman, LLC as sub-
adviser to provide management and related services. For the 12 months ended
8/31/99, the management/administration fees paid to Neuberger Berman
Management were 0.84% of average net assets.

FEE TABLE

SHAREHOLDER FEES None
- -------------------------------------------------------

ANNUAL OPERATING EXPENSES (% of average net assets)*

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

<TABLE>
<S> <C> <C>
Management fees 0.84
PLUS: Distribution (12b-1) fees 0.25
Other expenses 0.47
....
EQUALS: Total annual operating expenses 1.56
MINUS: Expense reimbursement** 0.06
....
EQUALS: Net expenses 1.50
</TABLE>

* THE TABLE INCLUDES COSTS PAID BY THE FUND AND ITS SHARE OF MASTER PORTFOLIO
COSTS. FOR MORE INFORMATION ON MASTER/FEEDER FUNDS, SEE "FUND STRUCTURE" ON
PAGE 47.

EXPENSE EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
- ----------------------------------------------------------------
<S> <C> <C> <C> <C>
Expenses $153 $474 $818 $1791
</TABLE>

18 Neuberger Berman
<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
Year Ended August 31, 1997(1) 1998 1999
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PER-SHARE DATA ($)
Data apply to a single share throughout each year indicated. You can see what the fund earned (or lost), what it
distributed to investors, and how its share price changed.
Share price (NAV) at beginning of year 10.00 13.88 10.81
PLUS: Income from investment operations
Net investment income (loss) 0.01 (0.02) --
Net gains/losses -- realized and unrealized 3.88 (2.92) 2.73
Subtotal: income from investment operations 3.89 (2.94) 2.73
MINUS: Distributions to shareholders
Income dividends 0.01 -- --
Capital gain distributions -- 0.13 --
Subtotal: distributions to shareholders 0.01 0.13 --
.............................................
EQUALS: Share price (NAV) at end of year 13.88 10.81 13.54
- --------------------------------------------------------------------------------------------------------------------
RATIOS (% of average net assets)
The ratios show the fund's expenses and net investment income (loss) -- as they actually are as well as how they
would have been if certain expense reimbursement and offset arrangements had not been in effect.
Net expenses -- actual 1.50(2) 1.50 1.50
Gross expenses(3) 5.65(2) 1.63 1.56
Expenses(4) 1.50(2) 1.50 1.50
Net investment income (loss) -- actual (0.12)(2) (0.16) 0.03
- --------------------------------------------------------------------------------------------------------------------
OTHER DATA
Total return shows how an investment in the fund would have performed over each year, assuming all distributions
were reinvested. The turnover rate reflects how actively the fund bought and sold securities.
Total return(6) (%) 38.92(5) (21.34) 25.25
Net assets at end of year (in millions of dollars) 9.3 17.5 24.8
Portfolio turnover rate (%) 50 60 73
</TABLE>

(1) PERIOD FROM 9/4/96 (BEGINNING OF OPERATIONS) TO 8/31/97.

(2) ANNUALIZED.

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

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

(5) NOT ANNUALIZED.

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

Guardian Assets 19
<PAGE>
[PHOTO]

NEUBERGER BERMAN
MANHATTAN ASSETS
- --------------------------------------------------------------------------------

<TABLE>
<C> <S>
Ticker Symbol: NBMBX ABOVE: PORTFOLIO MANAGERS JENNIFER K. SILVER AND BROOKE A.
COBB
</TABLE>

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

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

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

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

GROWTH INVESTING

For growth investors, the aim is to invest in companies that are already
successful but could be even more so. Often, these stocks are in emerging or
rapidly growing industries and may not yet have reached their full potential.
The growth investor looks for indications of continued success.

[ICON]

THE FUND SEEKS GROWTH OF CAPITAL.

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

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

- - above-average growth of earnings

- - earnings that have exceeded analysts' expectations

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

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

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

Manhattan Assets 21
<PAGE>
MAIN RISKS
- ------------------------------------------------------------

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

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

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

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

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

- - underperform other types of stocks or be difficult to sell when the economy is
not robust, during market downturns, or when mid-cap stocks are out of favor

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

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

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

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

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

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
1989 29.09%
'90 -8.05%
'91 30.89%
'92 17.77%
'93 10.01%
'94 -3.60%
'95 31.00%
'96 9.60%
'97 28.58%
'98 15.75%
BEST
QUARTER:
Q4 '98,
up
27.05%
WORST
QUARTER:
Q3 '98,
21.22%
Year-to-date
performance
as of
9/30/99: up
0.62%
</TABLE>

AVERAGE ANNUAL TOTAL % RETURNS as of 12/31/98*

<TABLE>
<CAPTION>
1 Year 5 Years 10 Years
- ------------------------------------------------------------
<S> <C> <C> <C>
MANHATTAN ASSETS 15.75 15.55 15.28
Russell Midcap Growth Index 17.86 17.34 17.30
S&P 500 Index 28.52 24.02 19.16
</TABLE>

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

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

* THE FUND BEGAN OPERATING IN SEPTEMBER 1996. PERFORMANCE RESULTS FROM 1989 TO
SEPTEMBER 1996 ARE ACTUALLY THOSE OF ANOTHER FUND THAT NEUBERGER BERMAN
MANAGEMENT HAS ADVISED SINCE 1979, AND THAT INVESTS IN THE SAME PORTFOLIO OF
SECURITIES. BECAUSE THE OLDER FUND HAD MODERATELY LOWER EXPENSES, ITS
PERFORMANCE TYPICALLY SHOULD BE SLIGHTLY BETTER THAN MANHATTAN ASSETS WOULD
HAVE HAD. THAT OLDER FUND IS NOT OFFERED IN THIS PROSPECTUS.

Manhattan Assets 23
<PAGE>
INVESTOR EXPENSES
- ------------------------------------------------------------

MANAGEMENT

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

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

FEE TABLE

SHAREHOLDER FEES None
- -------------------------------------------------------

ANNUAL OPERATING EXPENSES (% of average net assets)*

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

<TABLE>
<S> <C> <C>
Management fees 0.93
PLUS: Distribution (12b-1) fees 0.25
Other expenses 18.81
.......
EQUALS: Total annual operating expenses 19.99
MINUS: Expense reimbursement** 18.49
.......
EQUALS: Net expenses 1.50
</TABLE>

* THE TABLE INCLUDES COSTS PAID BY THE FUND AND ITS SHARE OF MASTER PORTFOLIO
COSTS. FOR MORE INFORMATION ON MASTER/FEEDER FUNDS, SEE "FUND STRUCTURE" ON
PAGE 47.

EXPENSE EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
- ----------------------------------------------------------------
<S> <C> <C> <C> <C>
Expenses $153 $474 $818 $1791
</TABLE>

24 Neuberger Berman
<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
Year Ended August 31, 1997(1) 1998 1999
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PER-SHARE DATA ($)
Data apply to a single share throughout each year indicated. You can see what the fund earned (or lost), what
it distributed to investors, and how its share price changed.
Share price (NAV) at beginning of year 10.00 13.75 10.76
PLUS: Income from investment operations
Net investment loss (0.08) (0.11) (0.04)
NET GAINS/LOSSES -- REALIZED AND
UNREALIZED 3.94 (1.22) 3.92
Subtotal: income from investment
operations 3.86 (1.33) 3.88
MINUS: Distributions to shareholders
Capital gain distributions 0.11 1.66 0.10
Subtotal: distributions to shareholders 0.11 1.66 0.10
.....................................................
EQUALS: Share price (NAV) at end of year 13.75 10.76 14.54
- -------------------------------------------------------------------------------------------------------------
RATIOS (% of average net assets)
The ratios show the fund's expenses and net investment loss -- as they actually are as well as how they would
have been if certain expense reimbursement and offset arrangements had not been in effect.
Net expenses -- actual 1.50(2) 1.50 1.50
Gross expenses(3) 77.83(2) 42.53 19.99
Expenses(4) 1.50(2) 1.50 1.50
Net investment loss -- actual (0.70)(2) (0.98) (1.00)
- -------------------------------------------------------------------------------------------------------------
OTHER DATA
Total return shows how an investment in the fund would have performed over each year, assuming all
distributions were reinvested. The turnover rate reflects how actively the fund bought and sold securities.
Total return(6) (%) 38.86(5) (11.29) 36.09
Net assets at end of year (in millions of dollars) 0.1 0.2 1.7
Portfolio turnover rate (%) 89 90 115
</TABLE>

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

(1) PERIOD FROM 9/4/96 (BEGINNING OF OPERATIONS) TO 8/31/97.

(2) ANNUALIZED.

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

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

(5) NOT ANNUALIZED.

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

Manhattan Assets 25
<PAGE>
[PHOTO]

NEUBERGER BERMAN
MILLENNIUM ASSETS
- --------------------------------------------------------------------------------

<TABLE>
<C> <S>
ABOVE: PORTFOLIO MANAGERS JENNIFER K. SILVER AND MICHAEL F.
MALOUF
</TABLE>

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

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

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

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

[ICON]
THE FUND SEEKS GROWTH OF CAPITAL.

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

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

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

Millennium Assets 27
<PAGE>
MAIN RISKS
- ------------------------------------------------------------

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

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

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

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

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

- - underperform other types of stocks or be difficult to sell when the economy is
not robust, during market downturns, or when small-cap stocks are out of favor

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

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

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

PERFORMANCE -- Because the fund is in its first calendar year of operations,
performance charts are not included.

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

MANAGEMENT

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

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

NEUBERGER BERMAN MANAGEMENT is the fund's investment adviser, and in turn
engages Neuberger Berman, LLC to provide management and related services. For
these services, the fund pays NB Management a fee at the annual rate of 0.85% of
the first $250 million of the average daily net assets, 0.80% of the next $250
million, 0.75% of the next $250 million, 0.70% of the next $250 million, and
0.65% of average daily net assets in excess of $1.0 billion.

FEE TABLE

SHAREHOLDER FEES None
- -------------------------------------------------------
ANNUAL OPERATING EXPENSES (% of average net assets)*

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

<TABLE>
<S> <C> <C>
Management fees 1.25
PLUS: Distribution (12b-1) fees 0.25
Other expenses** 0.57
....
EQUALS: Total annual operating expenses 2.07
MINUS: Expense reimbursement 0.32
....
EQUALS: Net expenses 1.75
</TABLE>

* NEUBERGER BERMAN MANAGEMENT HAS CONTRACTUALLY AGREED TO REIMBURSE CERTAIN
EXPENSES OF THE FUND THROUGH 12/31/02 SO THAT THE TOTAL ANNUAL OPERATING
EXPENSES OF THE FUND ARE LIMITED TO 1.75% OF AVERAGE NET ASSETS. THIS
ARRANGEMENT DOES NOT COVER INTEREST, TAXES, BROKERAGE COMMISSIONS, AND
EXTRAORDINARY EXPENSES. THE TABLE INCUDES COSTS PAID BY THE FUND AND ITS
SHARE OF MASTER PORTFOLIO COSTS. FOR MORE INFORMATION ON MASTER/FEEDER FUNDS,
SEE "FUND STRUCTURE" ON PAGE 47.

** OTHER EXPENSES ARE ESTIMATED FOR THE CURRENT FISCAL YEAR.

EXPENSE EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years
- ----------------------------------------------------------
<S> <C> <C>
Expenses** $178 $551
</TABLE>

Millennium Assets 29
<PAGE>
[PHOTO]

NEUBERGER BERMAN
PARTNERS ASSETS
- --------------------------------------------------------------------------------

<TABLE>
<C> <S>
Ticker Symbol: NBPBX ABOVE: PORTFOLIO MANAGERS ROBERT I. GENDELMAN AND S. BASU
MULLICK
</TABLE>

"OUR GOAL IS TO FIND COMPANIES THAT WE BELIEVE ARE UNDERVALUED RELATIVE TO
THEIR EARNINGS POTENTIAL, WHERE WE SEE A GAP BETWEEN THE ACTUAL PRICE OF A
STOCK AND ITS INTRINSIC VALUE. WHEN A COMPANY GROWS IN VALUE AND/OR THE
VALUATION GAP CLOSES, THE SUCCESS OF OUR STRATEGY IS REALIZED."

30
<PAGE>
GOAL & STRATEGY
- ------------------------------------------------------------

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

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

[ICON]
THE FUND SEEKS GROWTH OF CAPITAL.

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

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

- - strong fundamentals, such as a company's financial, operational, and
competitive positions

- - consistent cash flow

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

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

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

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

Partners Assets 31
<PAGE>
MAIN RISKS
- ------------------------------------------------------------

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

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

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

To the extent that the fund emphasizes mid- or large-cap stocks, it takes on the
associated risks. Mid-cap stocks tend to be more volatile than large-cap stocks,
and are usually more sensitive to economic and market factors. At any given
time, one or both groups of stocks may be out of favor with investors.

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

32 Neuberger Berman
<PAGE>
PERFORMANCE
- ------------------------------------------------------------

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

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

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
1989 22.78%
'90 -5.11%
'91 22.36%
'92 17.52%
'93 16.46%
'94 -1.89%
'95 35.21%
'96 26.27%
'97 28.44%
'98 5.59%
BEST
QUARTER:
Q4 '98,
up
16.17%
WORST
QUARTER:
Q3 '98,
down
14.87%
Year-to-date
performance
as of
9/30/99:
down 1.57%
</TABLE>

AVERAGE ANNUAL TOTAL % RETURNS as of 12/31/98*

<TABLE>
<CAPTION>
1 Year 5 Years 10 Years
- ------------------------------------------------------------
<S> <C> <C> <C>
PARTNERS ASSETS 5.59 17.83 16.05
S&P 500 Index 28.52 24.02 19.16
Russell 1000 Value Index 15.63 20.86 17.38
</TABLE>

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

The Russell 1000 Value Index is an unmanaged index of U.S. mid- and large-cap
value stocks.

* THE FUND BEGAN OPERATING IN AUGUST 1996. PERFORMANCE RESULTS FROM 1989 TO
AUGUST 1996 ARE ACTUALLY THOSE OF ANOTHER FUND THAT NEUBERGER BERMAN
MANAGEMENT HAS ADVISED SINCE 1975, AND THAT INVESTS IN THE SAME PORTFOLIO OF
SECURITIES. BECAUSE THE OLDER FUND HAD MODERATELY LOWER EXPENSES, ITS
PERFORMANCE TYPICALLY SHOULD BE SLIGHTLY BETTER THAN PARTNERS ASSETS WOULD
HAVE HAD. THAT OLDER FUND IS NOT OFFERED IN THIS PROSPECTUS.

Partners Assets 33
<PAGE>
INVESTOR EXPENSES
- ------------------------------------------------------------

MANAGEMENT

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

FEE TABLE

SHAREHOLDER FEES None
- -------------------------------------------------------

ANNUAL OPERATING EXPENSES (% of average net assets)*

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

<TABLE>
<S> <C> <C>
Management fees 0.85
PLUS: Distribution (12b-1) fees 0.25
Other expenses 0.21
....
EQUALS: Total annual operating expenses 1.31
....
</TABLE>

* NEUBERGER BERMAN MANAGEMENT HAS CONTRACTUALLY AGREED TO REIMBURSE CERTAIN
EXPENSES OF THE FUND THROUGH 12/31/09, SO THAT THE TOTAL ANNUAL OPERATING
EXPENSES OF THE FUND ARE LIMITED TO 1.50% OF AVERAGE NET ASSETS. THIS
ARRANGEMENT DOES NOT COVER INTEREST, TAXES, BROKERAGE COMMISSIONS, AND
EXTRAORDINARY EXPENSES. THE TABLE INCLUDES COSTS PAID BY THE FUND AND ITS
SHARE OF MASTER PORTFOLIO COSTS. FOR MORE INFORMATION ON MASTER/FEEDER FUNDS,
SEE "FUND STRUCTURE" ON PAGE 47.

EXPENSE EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
- ----------------------------------------------------------------
<S> <C> <C> <C> <C>
Expenses $133 $415 $718 $1579
</TABLE>

34 Neuberger Berman
<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
Year Ended August 31, 1996(1) 1997 1998 1999
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA ($)
Data apply to a single share throughout each year indicated. You can see what the fund earned (or lost), what it distributed to
investors, and how its share price changed.
Share price (NAV) at beginning of year 10.00 9.91 14.42 12.59
PLUS: Income from investment operations
Net investment income -- 0.01 0.01 0.06
Net gains/losses -- realized and unrealized (0.09) 4.56 (1.51) 3.15
Subtotal: income from investment operations (0.09) 4.57 (1.50) 3.21
MINUS: Distributions to shareholders
Income dividends -- 0.01 0.01 0.06
Capital gain distributions -- 0.05 0.32 --
Subtotal: distributions to shareholders -- 0.06 0.33 0.06
.......................................................
EQUALS: Share price (NAV) at end of year 9.91 14.42 12.59 15.74
- --------------------------------------------------------------------------------------------------------------------------------
RATIOS (% of average net assets)
The ratios show the fund's expenses and net investment income -- as they actually are as well as how they would have been if
certain expense reimbursement and offset arrangements had not been in effect.
Net expenses -- actual 1.50(2) 1.50 1.50 1.31
Gross expenses(3) 11,685.89(2) 8.74 1.56 --
Expenses(4) 1.50(2) 1.50 1.50 1.31
Net investment income -- actual 2.38(2) 0.08 0.12 0.41
- --------------------------------------------------------------------------------------------------------------------------------
OTHER DATA
Total return shows how an investment in the fund would have performed over each year, assuming all distributions were
reinvested. The turnover rate reflects how actively the fund bought and sold securities.
Total return (%) (0.90)(5)(6) 46.26(6) (10.69)(6) 25.51
Net assets at end of year (in millions of dollars) 0.1 5.8 29.3 62.4
Portfolio turnover rate (%) 96 77 109 132
</TABLE>

(1) PERIOD FROM 8/19/96 (BEGINNING OF OPERATIONS) TO 8/31/96.

(2) ANNUALIZED.

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

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

(5) NOT ANNUALIZED.

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

Partners Assets 35
<PAGE>

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36
<PAGE>

(This Page Has Been Left Blank Intentionally)
37
<PAGE>

(This Page Has Been Left Blank Intentionally)
38

<PAGE>

(This Page Has Been Left Blank Intentionally)
39
<PAGE>

(This Page Has Been Left Blank Intentionally)

<PAGE>

(This Page Has Been Left Blank Intentionally)

<PAGE>
YOUR INVESTMENT

MAINTAINING YOUR
ACCOUNT
- ------------------------------------------------------------

YOUR INVESTMENT PROVIDER
The fund shares described in this prospectus are available only through
investment providers such as banks, brokerage firms, workplace retirement
programs, and financial advisers.

The fees and policies outlined in this prospectus are set by the funds and by
Neuberger Berman Management. However, most of the information you'll need for
managing your investment will come from your investment provider. This includes
information on how to buy and sell shares, investor services, and additional
policies.

In exchange for the services it offers, your investment provider may charge
fees, which are in addition to those described in this prospectus.

To buy or sell shares of any of the funds described in this prospectus, contact
your investment provider. All investments must be made in U.S. dollars, and
investment checks must be drawn on a U.S. bank. The funds do not issue
certificates for shares.

Most investment providers allow you to take advantage of the Neuberger Berman
fund exchange program, which is designed for moving money from one Neuberger
Berman fund to another through an exchange of shares. However, this privilege
can be withdrawn from any investor that we believe is trying to "time the
market" or is otherwise making exchanges that we judge to be excessive. Frequent
exchanges can interfere with fund management and affect costs and performance
for other shareholders.

Under certain circumstances, the funds reserve the right to:

- - suspend the offering of shares

- - reject any exchange or investment order

- - change, suspend, or revoke the exchange privilege

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

- - suspend or postpone the redemption of shares on days when trading on the New
York Stock Exchange is restricted, or as otherwise permitted by the SEC

42 Neuberger Berman
<PAGE>
- ------------------------------------------------------------

BUYING SHARES BEFORE
A DISTRIBUTION

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

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

Generally, if you're investing in a tax-advantaged account, there are no tax
consequences to you.

The proceeds from the shares you sold are generally sent out the next business
day after your order is executed, and nearly always within three business days.
There are two cases in which proceeds may be delayed beyond this time:

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

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

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

DISTRIBUTION FEES -- The funds have adopted a plan under which each fund pays
0.25% of its average net assets every year to support share distribution and
shareholder servicing. These fees increase the cost of investing in the funds.
Over the long term, they could result in higher overall costs than other types
of sales charges.

Your Investment 43
<PAGE>
SHARE PRICES
- ------------------------------------------------------------

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

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

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

Because these funds do not have initial sales charges, the price you pay for
each share of a fund is the fund's net asset value per share. Similarly, because
these funds charge no fees for selling shares, they pay you the full share price
when you sell shares. Remember that your investment provider may charge fees for
its services.

The funds are open for business every day the New York Stock Exchange is open.
The Exchange is closed on all national holidays and Good Friday; fund shares
will not be priced on those days. In general, every buy or sell order you place
will go through at the next share price to be calculated after your order has
been accepted; check with your investment provider to find out by what time your
order must be received in order to be processed the same day. Each fund
calculates its share price as of the end of regular trading on the Exchange on
business days, usually 4:00 p.m. eastern time. Depending on when your investment
provider accepts orders, it's possible that the fund's share price could change
on days when you are unable to buy or sell shares.

Also, because foreign markets may be open on days when U.S. markets are closed,
the value of foreign securities owned by a fund could change on days when you
can't buy or sell fund shares. Remember, though, any purchase or sale takes
place at the next share price calculated after your order is received.

44 Neuberger Berman
<PAGE>
DISTRIBUTIONS
AND TAXES
- ------------------------------------------------------------

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

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

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

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

Consult your investment provider about whether your income and capital gain
distributions from a fund will be reinvested in that fund or paid to you in
cash.

HOW DISTRIBUTIONS ARE TAXED -- Except for tax-advantaged retirement accounts and
other tax-exempt investors, all fund distributions you receive are generally
taxable to you, regardless of whether you take them in cash or reinvest them.
Fund distributions to Roth IRAs, other individual retirement accounts and
qualified retirement plans generally are tax-free. Eventual withdrawals from a
Roth IRA of those amounts also may be tax-free, while withdrawals from other
retirement accounts and plans generally are subject to tax.

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

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

Your Investment 45
<PAGE>
DISTRIBUTIONS
AND TAXES CONTINUED
- -------------------------------------------------------------------

EURO AND YEAR 2000
ISSUES

Like other mutual funds, the funds could be affected by problems relating to the
conversion of European currencies into the Euro, which extends from 1/1/99 to
7/1/02, and the ability of computer systems to recognize the year 2000.

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

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

HOW SHARE TRANSACTIONS ARE TAXED -- When you sell or exchange fund shares, you
generally realize a taxable gain or loss. The exception, once again, is
tax-advantaged retirement accounts.

UNCASHED CHECKS -- When you receive a check, you may want to deposit or cash it
right away, as you will not receive interest on uncashed checks.

46 Neuberger Berman
<PAGE>
FUND STRUCTURE
- ------------------------------------------------------------

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

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

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

Your Investment 47
<PAGE>
- -------------------------------------------------------------------

NOTES

48
<PAGE>
49
<PAGE>
- ------------------------------------------------------------

OBTAINING INFORMATION
You can obtain a shareholder report, SAI, and other information from your
investment provider, or from:

NEUBERGER BERMAN
MANAGEMENT INC.
605 Third Avenue 2nd floor
New York, NY 10158-0180
800.877.9700
212.476.8800

Broker/Dealer and
Institutional Services:
800.366.6264

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

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

Web site:
www.sec.gov

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

NEUBERGER BERMAN EQUITY ASSETS

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

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

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

- - fund performance data and financial statements

- - complete portfolio holdings

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

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

- - investment limitations and additional policies

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

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

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

[LOGO]

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

[RECYCLE LOGO] NMLRR0591299 SEC file number: 811-8106

<PAGE>

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

NEUBERGER BERMAN EQUITY ASSETS AND PORTFOLIOS

STATEMENT OF ADDITIONAL INFORMATION

DATED DECEMBER 1, 1999

Neuberger Berman MANHATTAN Assets (and Neuberger Berman GENESIS Assets (and
Neuberger Berman Manhattan Portfolio) Neuberger Berman Genesis Portfolio)

Neuberger Berman FOCUS Assets (and Neuberger Berman GUARDIAN Assets (and
Neuberger Berman Focus Portfolio) Neuberger Berman Guardian Portfolio)

Neuberger Berman MILLENNIUM Assets (and Neuberger Berman PARTNERS Assets (and
Neuberger Berman Millennium Portfolio) Neuberger Berman Partners Portfolio

Neuberger Berman SOCIALLY RESPONSIVE Assets
(and Neuberger Berman Socially Responsive Portfolio)

No-Load Mutual Funds
605 Third Avenue, 2nd Floor, New York, NY 10158-0180
Toll-Free 800-366-6264

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

Neuberger Berman MANHATTAN Assets, Neuberger Berman GENESIS Assets,
Neuberger Berman FOCUS Assets, Neuberger Berman GUARDIAN Assets, Neuberger
Berman MILLENNIUM Assets, Neuberger Berman PARTNERS Assets, and Neuberger Berman
SOCIALLY RESPONSIVE Assets (each a "Fund") are mutual funds that offer shares
pursuant to a Prospectus dated December 1, 1999. The Funds invest all of their
net investable assets in Neuberger Berman MANHATTAN Portfolio, Neuberger Berman
GENESIS Portfolio, Neuberger Berman FOCUS Portfolio, Neuberger Berman GUARDIAN
Portfolio, Neuberger Berman MILLENNIUM Portfolio, Neuberger Berman PARTNERS
Portfolio, and Neuberger Berman SOCIALLY RESPONSIVE Portfolio (each a
"Portfolio"), respectively.

AN INVESTOR CAN BUY, OWN, AND SELL FUND SHARES ONLY THROUGH AN
ACCOUNT WITH AN ADMINISTRATOR, BROKER-DEALER, OR OTHER INSTITUTION THAT PROVIDES
ACCOUNTING, RECORDKEEPING, AND OTHER SERVICES TO INVESTORS AND THAT HAS AN
ADMINISTRATIVE SERVICES AGREEMENT WITH NEUBERGER BERMAN MANAGEMENT INC. ("NB
MANAGEMENT") AND/OR AN AGREEMENT WITH NB MANAGEMENT TO MAKE FUND SHARES
AVAILABLE TO ITS CLIENTS (EACH AN "INSTITUTION").

The Funds' Prospectus provides basic information that an investor
should know before investing. You can get a free copy of the Prospectus from NB
Management, Institutional Services, 605 Third Avenue, 2nd Floor, New York, NY
10158-0180, or by calling 800-366-6264.

<PAGE>

This Statement of Additional Information ("SAI") is not a prospectus
and should be read in conjunction with the Prospectus.

No person has been authorized to give any information or to make any
representations not contained in the Prospectus or in this SAI in connection
with the offering made by the Prospectus, and, if given or made, such
information or representations must not be relied upon as having been authorized
by a Fund or its distributor. The Prospectus and this SAI do not constitute an
offering by a Fund or its distributor in any jurisdiction in which such offering
may not lawfully be made.

The "Neuberger Berman" name and logo are service marks of Neuberger
Berman, LLC. "Neuberger Berman Management Inc." and the fund and portfolio names
in this SAI are either service marks or registered trademarks of Neuberger
Berman Management Inc. (COPYRIGHT)1999 Neuberger Berman Management Inc.

<PAGE>

TABLE OF CONTENTS

Page
----

INVESTMENT INFORMATION.......................................................1
Investment Policies and Limitations....................................1

Investment Insight.....................................................5
Neuberger Berman MANHATTAN Portfolio..............................5
Investment Program................................................5
Neuberger Berman GENESIS Portfolio................................6
Investment Program................................................6
Neuberger Berman FOCUS Portfolio..................................8
Neuberger Berman SOCIALLY RESPONSIVE Portfolio...................14
Additional Investment Information.....................................16
Neuberger Berman FOCUS Portfolio - Description of Economic Sectors....32
Neuberger Berman SOCIALLY RESPONSIVE Portfolio -
Description of Social Policy.....................................34

PERFORMANCE INFORMATION.....................................................37
Total Return Computations.............................................37
Comparative Information...............................................38
Other Performance Information.........................................39
CERTAIN RISK CONSIDERATIONS...........................................40

TRUSTEES AND OFFICERS.......................................................40

INVESTMENT MANAGEMENT AND ADMINISTRATION SERVICES...........................46
Investment Manager and Administrator..................................46
Sub-Adviser...........................................................50
Investment Companies Managed..........................................51
Management and Control of NB Management...............................53

DISTRIBUTION ARRANGEMENTS...................................................53
Distributor...........................................................53
Rule 12b-1 Plan.......................................................54
Share Prices and Net Asset Value......................................55

ADDITIONAL EXCHANGE INFORMATION.............................................56

ADDITIONAL REDEMPTION INFORMATION...........................................56
Suspension of Redemptions.............................................56

i
<PAGE>

Redemptions in Kind...................................................57

DIVIDENDS AND OTHER DISTRIBUTIONS...........................................57

ADDITIONAL TAX INFORMATION..................................................58
Taxation of the Funds.................................................58
Taxation of the Portfolios............................................59
Taxation of the Funds'Shareholders....................................61

PORTFOLIO TRANSACTIONS......................................................61
Portfolio Turnover....................................................68

REPORTS TO SHAREHOLDERS.....................................................68

ORGANIZATION, CAPITALIZATION AND OTHER MATTERS..............................68

CUSTODIAN AND TRANSFER AGENT................................................71

LEGAL COUNSEL...............................................................71

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES.........................72

REGISTRATION STATEMENT......................................................74

FINANCIAL STATEMENTS........................................................74

Appendix A...................................................................1
RATINGS OF CORPORATE BONDS AND COMMERCIAL PAPER........................1

ii
<PAGE>

INVESTMENT INFORMATION

Each Fund is a separate series of Neuberger Berman Equity Assets
("Trust"), a Delaware business trust that is registered with the Securities and
Exchange Commission ("SEC") as a diversified, open-end management investment
company. Each Fund seeks its investment objective by investing all of its net
investable assets in a Portfolio of Equity Managers Trust ("Managers Trust")
that has an investment objective identical to, and a name similar to, that of
the Fund. Each Portfolio, in turn, invests in securities in accordance with an
investment objective, policies, and limitations identical to those of its
corresponding Fund. (The Trust and Managers Trust, which is an open-end
management investment company managed by NB Management, are together referred to
below as the "Trusts.") The following information supplements the discussion in
the Prospectus of the investment objective, policies, and limitations of each
Fund and Portfolio. The investment objective and, unless otherwise specified,
the investment policies and limitations of each Fund and Portfolio are not
fundamental. Any investment objective, policy or limitation that is not
fundamental may be changed by the trustees of the Trust ("Fund Trustees") or of
Managers Trust ("Portfolio Trustees") without shareholder approval. The
fundamental investment policies and limitations of a Fund or a Portfolio may not
be changed without the approval of the lesser of:

(1) 67% of the total units of beneficial interest ("shares") of the
Fund or Portfolio represented at a meeting at which more than 50% of the
outstanding Fund or Portfolio shares are represented, or

(2) a majority of the outstanding shares of the Fund or Portfolio.

These percentages are required by the Investment Company Act of 1940
("1940 Act") and are referred to in this SAI as a "1940 Act majority vote."
Whenever a Fund is called upon to vote on a change in a fundamental investment
policy or limitation of its corresponding Portfolio, the Fund casts its votes in
proportion to the votes of its shareholders at a meeting thereof called for that
purpose.

Investment Policies and Limitations
- -----------------------------------

Each Fund (except for Neuberger Berman SOCIALLY RESPONSIVE and
MILLENNIUM Assets) has the following fundamental investment policy, to enable it
to invest in its corresponding Portfolio:

Notwithstanding any other investment policy of the Fund,
the Fund may invest all of its investable assets (cash, securities,
and receivables relating to securities) in an open-end management
investment company having substantially the same investment
objective, policies, and limitations as the Fund.

Neuberger Berman SOCIALLY RESPONSIVE and MILLENNIUM Assets have the
following fundamental investment policy, to enable each Fund to invest in its
corresponding Portfolio:

Notwithstanding any other investment policy of the Fund,
the Fund may invest all of its net investable assets (cash,
securities, and receivables relating to securities) in an open-end

<PAGE>

management investment company having substantially the same
investment objective, policies, and limitations as the Fund.

All other fundamental investment policies and limitations and the
non-fundamental investment policies and limitations of each Fund are identical
to those of its corresponding Portfolio. Therefore, although the following
discusses the investment policies and limitations of the Portfolios, it applies
equally to their corresponding Funds.

Except for the limitation on borrowing, any investment policy or
limitation that involves a maximum percentage of securities or assets will not
be considered to be violated unless the percentage limitation is exceeded
immediately after, and because of, a transaction by a Portfolio.

The following investment policies and limitations are fundamental and
apply to all Portfolios:

1. BORROWING. No Portfolio may borrow money, except that a
Portfolio may (i) borrow money from banks for temporary or emergency purposes
and not for leveraging or investment and (ii) enter into reverse repurchase
agreements for any purpose; provided that (i) and (ii) in combination do not
exceed 33-1/3% of the value of its total assets (including the amount borrowed)
less liabilities (other than borrowings). If at any time borrowings exceed
33-1/3% of the value of a Portfolio's total assets, that Portfolio will reduce
its borrowings within three days (excluding Sundays and holidays) to the extent
necessary to comply with the 33-1/3% limitation.

2. COMMODITIES. No Portfolio may purchase physical commodities or
contracts thereon, unless acquired as a result of the ownership of securities or
instruments, but this restriction shall not prohibit a Portfolio from purchasing
futures contracts or options (including options on futures contracts, but
excluding options or futures contracts on physical commodities) or from
investing in securities of any kind.

3. DIVERSIFICATION. No Portfolio may, with respect to 75% of the
value of its total assets, purchase the securities of any issuer (other than
securities issued or guaranteed by the U.S. Government or any of its agencies or
instrumentalities) if, as a result, (i) more than 5% of the value of the
Portfolio's total assets would be invested in the securities of that issuer or
(ii) the Portfolio would hold more than 10% of the outstanding voting securities
of that issuer.

4. INDUSTRY CONCENTRATION. No Portfolio may purchase any security
if, as a result, 25% or more of its total assets (taken at current value) would
be invested in the securities of issuers having their principal business
activities in the same industry. This limitation does not apply to securities
issued or guaranteed by the U.S. Government or its agencies or
instrumentalities.

5. LENDING. No Portfolio may lend any security or make any other
loan if, as a result, more than 33-1/3% of its total assets (taken at current
value) would be lent to other parties, except, in accordance with its investment
objective, policies, and limitations, (i) through the purchase of a portion of

2
<PAGE>

an issue of debt securities or (ii) by engaging in repurchase agreements.

6. REAL ESTATE. No Portfolio may purchase real estate unless
acquired as a result of the ownership of securities or instruments, but this
restriction shall not prohibit a Portfolio from purchasing securities issued by
entities or investment vehicles that own or deal in real estate or interests
therein or instruments secured by real estate or interests therein.

7. SENIOR SECURITIES. No Portfolio may issue senior securities,
except as permitted under the 1940 Act.

8. UNDERWRITING. No Portfolio may underwrite securities of other
issuers, except to the extent that a Portfolio, in disposing of portfolio
securities, may be deemed to be an underwriter within the meaning of the
Securities Act of 1933 ("1933 Act").

For purposes of the limitation on commodities, the Portfolios do not
consider foreign currencies or forward contracts to be physical commodities.

The following investment policies and limitations are non-fundamental
and apply to all Portfolios unless otherwise indicated:

1. BORROWING. No Portfolio may purchase securities if outstanding
borrowings, including any reverse repurchase agreements, exceed 5% of its total
assets.

2. LENDING. Except for the purchase of debt securities and engaging
in repurchase agreements, no Portfolio may make any loans other than securities
loans.

3. MARGIN TRANSACTIONS. No Portfolio may purchase securities on
margin from brokers or other lenders, except that a Portfolio may obtain such
short-term credits as are necessary for the clearance of securities
transactions. Margin payments in connection with transactions in futures
contracts and options on futures contracts shall not constitute the purchase of
securities on margin and shall not be deemed to violate the foregoing
limitation.

4. FOREIGN SECURITIES (ALL PORTFOLIOS EXCEPT NEUBERGER BERMAN
MILLENNIUM PORTFOLIO). No Portfolio may invest more than 10% of the value of its
total assets in securities of foreign issuers, provided that this limitation
shall not apply to foreign securities denominated in U.S. dollars, including
American Depositary Receipts ("ADRs").

FOREIGN SECURITIES (NEUBERGER BERMAN MILLENNIUM PORTFOLIO). The
Portfolio may invest more than 20% of the value of its total assets in
securities of foreign issuers, provided that this limitation shall not apply to
foreign securities denominated in U.S. dollars, including American Depositary
Receipts ("ADRs").

5. ILLIQUID SECURITIES. No Portfolio may purchase any security if,
as a result, more than 15% of its net assets would be invested in illiquid
securities. Illiquid securities include securities that cannot be sold within
seven days in the ordinary course of business for approximately the amount at

3
<PAGE>

which the Portfolio has valued the securities, such as repurchase agreements
maturing in more than seven days.

6. PLEDGING (NEUBERGER BERMAN GENESIS AND NEUBERGER BERMAN GUARDIAN
PORTFOLIOS). Neither of these Portfolios may pledge or hypothecate any of its
assets, except that (i) Neuberger Berman GENESIS Portfolio may pledge or
hypothecate up to 15% of its total assets to collateralize a borrowing permitted
under fundamental policy 1 above or a letter of credit issued for a purpose set
forth in that policy and (ii) each Portfolio may pledge or hypothecate up to 5%
of its total assets in connection with its entry into any agreement or
arrangement pursuant to which a bank furnishes a letter of credit to
collateralize a capital commitment made by the Portfolio to a mutual insurance
company of which the Portfolio is a member. The other Portfolios are not subject
to any restrictions on their ability to pledge or hypothecate assets and may do
so in connection with permitted borrowings.

7. SECTOR CONCENTRATION (NEUBERGER BERMAN FOCUS PORTFOLIO). This
Portfolio may not invest more than 50% of its total assets in any one economic
sector.

8. SOCIAL POLICY (NEUBERGER BERMAN SOCIALLY RESPONSIVE PORTFOLIO).
The Portfolio may not purchase securities of issuers who derive more than 5% of
their total revenue from alcohol, tobacco, gambling or weapons, or that are
involved in nuclear power.

Although the Portfolios do not have policies limiting their
investment in warrants, no Portfolio currently intends to invest in warrants
unless acquired in units or attached to securities.

TEMPORARY DEFENSIVE POSITION. For temporary defensive purposes, each
Portfolio (except Neuberger Berman SOCIALLY RESPONSIVE Portfolio) may invest up
to 100% of its total assets in cash and cash equivalents, U.S. Government and
Agency Securities, commercial paper and certain other money market instruments
as well as repurchase agreements collateralized by the
forgoing.

Any part of Neuberger Berman SOCIALLY RESPONSIVE Portfolio's assets
may be retained temporarily in investment grade fixed income securities of
non-governmental issuers, U.S. Government and Agency Securities, repurchase
agreements, money market instruments, commercial paper, and cash and cash
equivalents when NB Management believes that significant adverse market,
economic political, or other circumstances require prompt action to avoid
losses. In addition, the feeder funds that invest in Neuberger Berman SOCIALLY
RESPONSIVE Portfolio deal with large institutional investors, and the Portfolio
may hold such instruments pending investment or payout when the Portfolio has
received a large influx of cash due to sales of Neuberger Berman SOCIALLY
RESPONSIVE Fund shares, or shares of another fund which invests in the
Portfolio, or when it anticipates a substantial redemption. Generally, the
foregoing temporary investments for Neuberger Berman SOCIALLY RESPONSIVE
Portfolio are selected with a concern for the social impact of each investment.

4
<PAGE>

Investment Insight
- ------------------

Neuberger Berman's commitment to its asset management approach is
reflected in the more than $125 million the organization's employees and their
families have invested in the Neuberger Berman mutual funds.

Neuberger Berman MANHATTAN Portfolio
------------------------------------

Investment Program
------------------

Invests in common stocks of mid-capitalization companies that are in new
or rapidly evolving industries. Seeks growth of capital by investing in
companies with financial strength, above-average growth of earnings, earnings
that have exceeded analysts' expectations, a strong position relative to
competitors and a stock price that is reasonable in light of its growth rate.

MID-CAP GROWTH STOCK INVESTMENTS

The portfolio co-managers consider themselves growth stock investors in
the purest sense of the term. By that, they mean they want to own the stocks of
companies that are growing earnings faster than the average American business
and, ideally, faster than the competitors in their respective industries. Their
exhaustive research efforts are focused on the mid-cap universe and,
specifically, stocks that are in new or rapidly evolving industries. The kind of
fast-growth companies the portfolio co-managers favor generally do not trade at
below market average price-to-earnings ratios. However, they do look for
companies trading at reasonable levels compared to their growth rates.

AN INTENSIVE RESEARCH EFFORT

The portfolio co-managers love stocks with positive earnings surprises.
Their extensive research has revealed that the stocks of companies that have
consistently beaten Wall Street earnings estimates have also tended to offer
greater potential for long-term capital appreciation. To find these companies
they scour the mid-cap growth stock universe to isolate stocks whose most recent
earnings have beaten consensus expectations. Then, the real work begins, where
through diligent fundamental research they strive to identify those companies
most likely to record a string of positive earnings surprises. Their ultimate
goal is to invest today in the fast growing mid-sized companies that they
believe are poised to become tomorrow's Fortune 500.

A DISCIPLINED SELL PROCESS

"We are dispassionate sellers," says one portfolio co-manager. "If a stock
does not live up to our earnings expectations or if we believe its valuation has
become excessive, we will sell and direct the assets to another opportunity we
find more attractive." A stock will also be sold when it reaches its target
price. They prefer to broadly diversify the portfolio's assets among many
different companies and industries rather than heavily concentrating its
holdings in just a few of the fastest growing industry sectors. This broad
diversification helps to manage the overall risk inherent in a portfolio of
equity securities.

5
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[GRAPHIC OMITTED]

MANHATTAN INVESTORS CAN EXPECT:

o Mid-cap growth stock investments
o An intensive research effort
o A disciplined sell process

INVESTMENT INSIGHT

Without question, the portfolio co-managers are growth stock investors.
They look for companies believed capable of delivering positive earnings
surprises, particularly those with the potential to do so consistently. Ideally,
they seek to identify companies that will someday rank among the Fortune 500.

Neuberger Berman GENESIS Portfolio
----------------------------------

Investment Program
------------------

Invests mainly in common stocks of small-capitalization companies. Seeks
undervalued companies whose current product lines and balance sheets are strong.
The Portfolio regards companies with market capitalizations of up to $1.5
billion at the time of investment as small-cap companies.

A SMALL-CAP VALUE BIAS

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<PAGE>

The portfolio co-managers employ a value bias in their stock selection
process. They comb the universe of small-cap stocks specifically looking for
those they consider cheap compared to the market as a whole. Depending on
current market conditions, they sometimes find stocks that are cheap on an
absolute basis as well. They primarily choose from a universe of small-cap
companies whose total market valuation is less than $1.5 billion at the time of
initial investment. The characteristics they look for may include above average
returns, established market niches, high barriers to entry, strong capital
bases, and sound future business prospects.

A PHILOSOPHY THAT CONTRADICTS POPULAR INVESTMENT TRENDS

The portfolio co-managers focus on strong companies in industry niches
that are often overlooked by investors because they lack an exciting new product
or innovation. They aren't interested in buying experimental or cutting-edge
technology names that often trade on high future expectations but have no
established record of earnings. The rationale behind their approach is that
companies in what may be considered "unexciting" industries to some, such as
utilities and oil services, are a safer point of entry into the small-cap
universe because, as they put it, "if there's not a lot of expectation built
into a company, then it tends not to disappoint."

SMALL COMPANIES, POTENTIALLY BIG OPPORTUNITIES

The portfolio co-managers favor the small-cap arena because they think it
abounds with opportunities for the long-term investor, specifically small-caps'
potential ability to grow earnings dramatically over time. According to one
portfolio co-manager, "Unlike large-cap stocks, small-cap companies are starting
from a very low base and therefore may have the ability to grow dramatically."

INVESTMENT PROCESS

(Qualitative Analysis

(Meetings with Company Executives One-on-One

o 300 Face-to-Face Meetings per Year

o Heavy Phone Contact

(Quantitative Characteristics

o Low Price-to-Earnings Ratio

o Low Price-to-Cash Flow Ratio

GENESIS INVESTORS CAN EXPECT:

o A small-cap value bias
o A philosophy that contradicts popular investment trends
o Small companies, potentially big opportunities

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<PAGE>

INVESTMENT INSIGHT

The portfolio co-managers seek out small companies that are not well known
and often found in unglamorous industries. Future growth is one area they focus
on, but equally important to them is evidence of solid performance and a proven
management team. As value investors, they look for stocks that are selling at
attractive prices.

THE RISKS INVOLVED IN SEEKING CAPITAL APPRECIATION FROM INVESTMENTS
PRIMARILY IN COMPANIES WITH SMALL MARKET CAPITALIZATION ARE SET FORTH IN THE
PROSPECTUS.

Neuberger Berman FOCUS Portfolio
--------------------------------

Investment Program
------------------

Seeks long-term growth of capital. Invests principally in common stocks
selected from 13 multi-industry sectors of the economy. To maximize potential
return, the Portfolio normally makes at least 90% or more of its investments in
not more than six sectors it identifies as undervalued.

EMPHASIS ON QUALITY, UNDERVALUED COMPANIES OF ALL MARKET CAPITALIZATIONS

The portfolio manager selects companies with solid fundamentals that he
considers undervalued by the marketplace. Specifically, he looks for industry
leaders with above-average earnings, established market niches, and sound future
business prospects. He believes these types of organizations come in all sizes,
therefore he does not limit his selections to any particular capitalization
range.

A CONCENTRATED PORTFOLIO

In addition to his value bias, the portfolio manager concentrates his
efforts on six out of 13 possible economic sectors. Although the portfolio is
built one stock at a time, he has found that the conditions leading to an
individual stock being undervalued similarly affect other companies in the same
industries or sectors. Thus, an emphasis on relatively few sectors is a natural
outgrowth of the fund's stock selection process. The portfolio manager won't
dedicate more than 50% of assets to any one sector and no more than 25% of
assets to any one industry.

BOTTOM-UP, VALUE-ORIENTED STOCK SELECTION PROCESS

The portfolio manager's bottom-up approach focuses on stocks that are
currently out of favor, due to temporary setbacks. He also likes stocks that
have been largely ignored by Wall Street, but that he believes still offer good
long-term growth potential. He prefers to buy companies that are industry
leaders, not those that he believes are undervalued for good reasons such as
poor management or limited growth prospects. Ideal investment candidates are
financially sound companies that have little or no debt and exhibit high returns
on equity.

8
<PAGE>

THOROUGH RESEARCH EFFORT

He believes it's the management teams that drive companies and how they
react to changes in their respective industries. As he explains, "The only way
to come to those conclusions is to meet with the people behind the stocks we
like." Furthermore, he does not rely on a company's initial merits after its
stock has been purchased. Instead, he prefers to revisit its fundamentals
regularly and then, as a reality check, look back at the company's performance
to see if it's consistently delivering.

INVESTMENT PROCESS

(Qualitative Analysis

o Meeting with Company Executives One-on-One

(Monitor Exposure to Economic Conditions

o Interest Rate Changes

(Sector Analysis

(Stock Universe

o Quantitative Analysis

FOCUS INVESTORS CAN EXPECT:

o Emphasis on quality, undervalued companies of all market capitalizations
o A concentrated portfolio
o Bottom-up, value-oriented stock selection process
o Thorough research efforts

INVESTMENT INSIGHT

The investment approach for the Focus Fund involves looking for companies
that have low price-to-earnings ratios, solid balance sheets and strong
management. The portfolio manager often finds that these companies are
concentrated in certain sectors of the economy, which prompts him to look
further within these sectors for other companies that meet his criteria.

Neuberger Berman GUARDIAN Portfolio
-----------------------------------

Investment Program
------------------

Seeks long term growth of capital and, secondarily, current income. Invests
primarily in stocks of long-established companies considered to be undervalued
in comparison to stocks of similar companies. Using a value-oriented investment
approach in selecting securities, the Portfolio looks for such

9
<PAGE>

factors as low price-to-earnings ratios, strong balance sheets, solid
management, and consistent earnings.

DISCIPLINED, LARGE-CAP VALUE ORIENTATION

As part of its stock selection process, the portfolio pursues a
disciplined, value-driven investment style, which is Neuberger Berman's historic
strength. Specifically, the portfolio co-managers seek large-capitalization
companies whose stock prices are substantially undervalued. Characteristics of
these firms may include: solid balance sheets, above-average returns, low
valuations, and consistent earnings.

BOTTOM-UP APPROACH TO STOCK SELECTION

According to one of the portfolio co-managers, "Cheap stocks are plentiful,
but true investment bargains are a rare find." To uncover them, the portfolio
co-managers scour a universe of stocks consisting of the bottom 20% of the
market in terms of valuation. Those deemed by the managers as inexpensive and
poised for a turnaround are placed under consideration. They look for
financially sound, well-managed companies that are undervalued relative to their
earnings potential and the market as a whole.

A BROAD VIEW OF RISK MANAGEMENT

Managing risk involves carefully monitoring the way the stocks in the
portfolio react to one another as well as to outside factors. Companies that are
in completely different sectors may in fact react similarly to certain economic,
market or international events. In their efforts to consider these
relationships, the portfolio co-managers use quantitative analysis to evaluate
these factors and their impact on the overall portfolio. It is a process they
believe is a crucial component in controlling risk and one that evolves over
time as new holdings are introduced to the portfolio.

A STRONG SELL DISCIPLINE

The portfolio co-managers will generally make an initial investment in a
stock of between 1-4% of total net assets. A higher weighting indicates that
they believe their research gives them an "edge" over Wall Street analysts, or
they believe the stock has an uncovered value that others may have overlooked.
Once a stock grows beyond the high side of that range, gains are harvested and
the holding is reduced to about 3% of total net assets.

INVESTMENT PROCESS

(Portfolio Risk Management

o Monitor Portfolio's Exposure

(Selection Criteria

o Improving Financials

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<PAGE>

o Superior Management

o Discount Valuations to the Market

(Stock Universe

o Large-Cap Value

GUARDIAN INVESTORS CAN EXPECT:

o Disciplined, large-cap value orientation
o Bottom-up approach to stock selection
o Broad view of risk management
o Strong sell discipline

INVESTMENT INSIGHT

The portfolio co-managers look for established companies whose intrinsic
value, by their measure, is undiscovered among the majority of investors. In
managing overall risk, a conscious effort is made to determine the risk/reward
scenario of each individual holding as well as its impact at the portfolio
level.

Neuberger Berman MILLENNIUM Portfolio
-------------------------------------

Investment Program
------------------

Invests primarily in equity securities of small-sized domestic companies
(up to $1.5 billion in market capitalization at time of investment). Seeks
growth of capital and looks for new companies that are in the developmental
stage as well as older companies that appear poised to grow because of new
products, markets or management.

DISCIPLINED STOCK SELECTION PROCESS

The portfolio co-managers employ a three-tiered disciplined investment
process. It begins with a search for fast growing, small companies that exhibit
sustainable earnings growth of at least 15%. Next, they assess a company's
financial and managerial wherewithal to capitalize on opportunities and grow its
business, despite occasional setbacks. Finally, the managers determine whether
or not a stock's price is reasonable. Their analysis attempts to avoid companies
considered overvalued relative to their earnings growth rate.

LONG-TERM GROWTH POTENTIAL OF SMALL-CAP STOCKS

Simply put, a small company might become a mid-sized one rapidly with the
launch of a single blockbuster product. And, since the potential growth of a
small company is often uninhibited by several layers of management, it might be
able to bring new products or services to the market quickly. What adds to the
attractiveness of small-cap stocks is the fact that they're generally less

11
<PAGE>

researched than large-caps, which presents the managers with more opportunities
to find good companies that are not yet recognized by many investors.
Small-caps, however, are more risky than other securities due to their
volatility and greater sensitivity to market trends, company news and industry
developments.

RISK MANAGEMENT

"We abide by three rules for managing risk: pay only reasonable prices,
remain emotionally detached, and stay diversified", says one of the portfolio
co-managers about their risk-management strategy. First, the Fund focuses on
rapidly growing companies that are selling at reasonable prices relative to
their growth prospects. This is done in an effort to avoid those stocks whose
valuations are out of line with their growth rates because we believe they are
often the most susceptible to steep declines caused by fundamental
disappointments or during a market downturn. Second, our portfolio co-managers
remain emotionally detached from their stock picks. When deteriorating
fundamentals are discovered in a company, the portfolio co-managers take quick
and decisive action to eliminate it from the portfolio. And third, to limit
downside risk, the portfolio co-managers expect to invest in a diversified
portfolio across an array of sectors and industries. No single stock represents
more than 5% of total assets, measured at the time of investment.

INVESTMENT PROCESS

SCREENS

(3 Price Is this stock price reasonable?

(2 Utility Can the company go the distance?

Financial Strength

Management Depth and Talent

(1 Growth Are earnings growing rapidly? 15%+ Annual Growth Rates

Positive Earnings Surprises

MILLENNIUM INVESTORS CAN EXPECT:

o Disciplined stock selection process
o Long-term growth potential of small-cap stocks
o Risk management

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<PAGE>

INVESTMENT INSIGHT

The portfolio co-managers of the Millennium Fund make it their business to
track down promising small-cap companies wherever they may exist. As a result,
this fund enables investors who can accept the risks of small-cap stocks to
pursue the potential for long-term growth that small-caps may provide.

Neuberger Berman PARTNERS Portfolio
-----------------------------------

Investment Program
------------------

Invests principally in common stocks of established companies, using the
value-oriented investment approach. Seeks growth of capital through an
investment approach that is designed to increase capital with reasonable risk.
Seeks securities believed to be undervalued based on strong fundamentals such as
a low price-to-earnings ratio, consistent cash flow, and a company's sound track
record through all phases of the market cycle.

UNDISCOVERED VALUES IN THE MID- TO LARGE-CAP ARENA

The Partners' portfolio co-managers comb the universe of mid- and large-cap
stocks in search of those that have yet to be "discovered" by the majority of
investors. They generally shy away from big, well-known companies because they
believe it is harder to gain a competitive edge in a stock that is covered by
many analysts. The managers prefer to focus their efforts outside of the Fortune
100, where they think many investment bargains abound.

STRONG COMPANIES AT REASONABLE PRICES

Like many of their value-oriented peers, the co-managers try to buy quality
stocks for substantially less than their estimated market values. However, they
differ in their approach by applying another layer of analysis to their value
strategy. For example, in addition to searching for stocks trading at below
market price-to-earnings ratios, they also focus on companies with strong
fundamentals, consistent cash flows, sound track records through all phases of
the market cycle and those selling at the low end of their trading ranges. They
are not interested in buying cheap stocks if they don't meet these other
measures of value as well.

SOLID RESEARCH

The portfolio co-managers believe that through "exhaustive research
efforts, good companies selling for less than their true worth can be
identified." To do this the portfolio co-managers spend a lot of time
interviewing senior company managers. Their philosophy is that when they sit
across the table from a CEO or CFO and question him or her about the company,
they get to know it quite well. They find that there's simply no substitute for
that kind of firsthand knowledge. In addition, the portfolio co-managers
carefully examine a company's financial statements and contact its suppliers and
competitors. While this type of analysis requires a lot of extra legwork, they
believe it's worth the effort.

13
<PAGE>

INVESTMENT PROCESS

(Executive Management Team Evaluation

o Proven Track Record

o Strategic Plan

o Inside Ownership

(Value Stock Universe

o Qualitative Evaluation: Catalyst for Change

(Stock Universe

o Quantitative Analysis

PARTNERS INVESTORS CAN EXPECT:

o Undiscovered values in the mid- to large-cap arena
o Strong companies at reasonable prices
o Solid research

INVESTMENT INSIGHT

The portfolio co-managers seek companies they believe are undervalued
relative to their earnings potential--where there is a gap between the actual
price of a stock and its intrinsic value in the marketplace. When a company
grows in value or the valuation gap closes, the success of their strategy is
realized.

Neuberger Berman SOCIALLY RESPONSIVE Portfolio
----------------------------------------------

Investment Program
------------------

Seeks long-term capital appreciation through investments primarily in
securities of companies that meet both financial criteria and social policy. The
portfolio co-managers initially screen companies using a value investing
criteria, then look for companies that show leadership in major areas of social
impact such as the environment, workplace diversity and employment.

FINANCIALLY SOUND COMPANIES WITH A SOCIAL CONSCIENCE

The portfolio co-managers look for the stocks of mid- to large-cap
companies that first meet their stringent financial criteria. Their social
screens are then applied to these stocks. The ones considered worthy from a
financial standpoint are then evaluated using a proprietary database that
develops and monitors information on companies in various categories of social
criteria. Ideal investment candidates are companies that show leadership in the
areas of the environment, workplace diversity and employment. Other

14
<PAGE>

considerations are based on companies' records in other areas of concern,
including public health, type of products, and corporate citizenship.

A TRADITIONAL VALUE APPROACH

The portfolio co-managers' initial financial screens select companies using
a traditional value approach. They look for undervalued companies with solid
balance sheets, strong management, consistent cash flows, and other
value-related factors, such as low price-to-earnings and low price-to-book
ratios. Their value approach examines these companies, searching for those that
may rise in price before other investors realize their worth. They strongly
believe in helping investors put their money to work, while supporting companies
that follow principles of good corporate citizenship.

AN EVER-EVOLVING JOURNEY ON THE PATH TO GOOD CORPORATE CITIZENSHIP

The portfolio co-managers believe that most socially responsive investors
are not utopians. They do not expect instant perfection, but rather look for
signs that a company is evolving and moving toward a corporate commitment to
excellence. As they put it, "Good corporate citizenship is one of those things
that is a journey, not a destination. We've been working in this field for some
time, and know that the social records of most companies are written in shades
of gray. We are pleased to see that more and more companies are coming to
realize that change is a positive force for them."

INVESTMENT PROCESS

(Social Policy

(Quantitative Financial Criteria

o Low Price-to-Earnings Ratio (relative & absolute)

o Strong Balance Sheet

o Free Cash Flow

o Risk Management

(Stock Universe

Focus Screens

SOCIALLY RESPONSIVE INVESTORS CAN EXPECT:
o Financially sound companies with a social conscience
o A traditional value approach
o An ever-evolving journey on the path to good corporate citizenship

15
<PAGE>

INVESTMENT INSIGHT

The portfolio co-managers believe that sound practices in areas like
employment and the environment can have a positive impact on a company's bottom
line. They look for companies that meet value-investing criteria and also show a
commitment to uphold or improve their standards of corporate citizenship.

* * * * *

Each Portfolio invests in a wide array of stocks, and no single stock makes
up more than a small fraction of any Portfolio's total assets. Of course, each
Portfolio's holdings are subject to change.

Additional Investment Information
- ---------------------------------

Some or all of the Portfolios, as indicated below, may make the
following investments, among others; some of which are part of the Portfolios'
principal investment strategies and some of which are not. The principal risks
of each Portfolio's principal strategies are discussed in the Prospectus. They
may not buy all of the types of securities or use all of the investment
techniques that are described.

ILLIQUID SECURITIES (ALL PORTFOLIOS). Illiquid securities are
securities that cannot be expected to be sold within seven days at approximately
the price at which they are valued. These may include unregistered or other
restricted securities and repurchase agreements maturing in greater than seven
days. Illiquid securities may also include commercial paper under section 4(2)
of the Securities Act of 1933, as amended, and Rule 144A securities (restricted
securities that may be traded freely among qualified institutional buyers
pursuant to an exemption from the registration requirements of the securities
laws); these securities are considered illiquid unless NB Management, acting
pursuant to guidelines established by the trustees of Managers Trust, determines
they are liquid. Generally, foreign securities freely tradable in their
principal market are not considered restricted or illiquid. Illiquid securities
may be difficult for a Portfolio to value or dispose of due to the absence of an
active trading market. The sale of some illiquid securities by the Portfolios
may be subject to legal restrictions which could be costly to the Portfolios.

POLICIES AND LIMITATIONS. Each Portfolio may invest up to 15% of its
net assets in illiquid securities.

REPURCHASE AGREEMENTS (ALL PORTFOLIOS). In a repurchase agreement, a
Portfolio purchases securities from a bank that is a member of the Federal
Reserve System or from a securities dealer that agrees to repurchase the
securities from the Portfolio at a higher price on a designated future date.
Repurchase agreements generally are for a short period of time, usually less
than a week. Costs, delays, or losses could result if the selling party to a
repurchase becomes bankrupt or otherwise defaults. NB Management monitors the
creditworthiness of sellers.

POLICIES AND LIMITATIONS. Repurchase agreements with a maturity of
more than seven days are considered to be illiquid securities. No Portfolio may
enter into a repurchase agreement with a maturity of more than seven days if, as

16
<PAGE>

a result, more than 15% of the value of its net assets would then be invested in
such repurchase agreements and other illiquid securities. A Portfolio may enter
into a repurchase agreement only if (1) the underlying securities are of a type
that the Portfolio's investment policies and limitations would allow it to
purchase directly, (2) the market value of the underlying securities, including
accrued interest, at all times equals or exceeds the repurchase price, and (3)
payment for the underlying securities is made only upon satisfactory evidence
that the securities are being held for the Portfolio's account by its custodian
or a bank acting as the Portfolio's agent.

SECURITIES LOANS (ALL PORTFOLIOS). Each Portfolio may lend securities
to banks, brokerage firms, and other institutional investors judged
credit-worthy by NB Management, provided that cash or equivalent collateral,
equal to at least 100% of the market value of the loaned securities, is
continuously maintained by the borrower with the Portfolio. The Portfolio may
invest the cash collateral and earn income, or it may receive an agreed upon
amount of interest income from a borrower who has delivered equivalent
collateral. During the time securities are on loan, the borrower will pay the
Portfolio an amount equivalent to any dividends or interest paid on such
securities. These loans are subject to termination at the option of the
Portfolio or the borrower. The Portfolio may pay reasonable administrative and
custodial fees in connection with a loan and may pay a negotiated portion of the
interest earned on the cash or equivalent collateral to the borrower or placing
broker. The Portfolio does not have the right to vote securities on loan, but
would terminate the loan and regain the right to vote if that were considered
important with respect to the investment. NB Management believes the risk of
loss on these transactions is slight because if a borrower were to default for
any reason, the collateral should satisfy the obligation. However, as with other
extensions of secured credit, loans of portfolio securities involve some risk of
loss of rights in the collateral should the borrower fail financially.

POLICIES AND LIMITATIONS. Each Portfolio may lend portfolio
securities with a value not exceeding 33-1/3% of its total assets to banks,
brokerage firms, or other institutional investors judged creditworthy by NB
Management. Borrowers are required continuously to secure their obligations to
return securities on loan from a Portfolio by depositing collateral in a form
determined to be satisfactory by the Portfolio Trustees. The collateral, which
must be marked to market daily, must be equal to at least 100% of the market
value of the loaned securities, which will also be marked to market daily.
Securities lending by Neuberger Berman SOCIALLY RESPONSIVE Portfolio is not
subject to the Social Policy.

RESTRICTED SECURITIES AND RULE 144A SECURITIES (ALL PORTFOLIOS). Each
Portfolio may invest in restricted securities, which are securities that may not
be sold to the public without an effective registration statement under the 1933
Act. Before they are registered, such securities may be sold only in a privately
negotiated transaction or pursuant to an exemption from registration. In
recognition of the increased size and liquidity of the institutional market for
unregistered securities and the importance of institutional investors in the
formation of capital, the SEC has adopted Rule 144A under the 1933 Act. Rule
144A is designed to facilitate efficient trading among institutional investors
by permitting the sale of certain unregistered securities to qualified
institutional buyers. To the extent privately placed securities held by a
Portfolio qualify under Rule 144A and an institutional market develops for those
securities, the Portfolio likely will be able to dispose of the securities
without registering them under the 1933 Act. To the extent that institutional
buyers become, for a time, uninterested in purchasing these securities,

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investing in Rule 144A securities could increase the level of a Portfolio's
illiquidity. NB Management, acting under guidelines established by the Portfolio
Trustees, may determine that certain securities qualified for trading under Rule
144A are liquid. Regulation S under the 1933 Act permits the sale abroad of
securities that are not registered for sale in the United States.

Where registration is required, a Portfolio may be obligated to pay
all or part of the registration expenses, and a considerable period may elapse
between the decision to sell and the time the Portfolio may be permitted to sell
a security under an effective registration statement. If, during such a period,
adverse market conditions were to develop, the Portfolio might obtain a less
favorable price than prevailed when it decided to sell. Restricted securities
for which no market exists are priced by a method that the Portfolio Trustees
believe accurately reflects fair value.

POLICIES AND LIMITATIONS. To the extent restricted securities,
including Rule 144A securities, are illiquid, purchases thereof will be subject
to each Portfolio's 15% limit on investments in illiquid securities.

REVERSE REPURCHASE AGREEMENTS (ALL PORTFOLIOS). In a reverse
repurchase agreement, a Portfolio sells portfolio securities subject to its
agreement to repurchase the securities at a later date for a fixed price
reflecting a market rate of interest. There is a risk that the counter-party to
a reverse repurchase agreement will be unable or unwilling to complete the
transaction as scheduled, which may result in losses to the Portfolio.

POLICIES AND LIMITATIONS. Reverse repurchase agreements are
considered borrowings for purposes of each Portfolio's investment policies and
limitations concerning borrowings. While a reverse repurchase agreement is
outstanding, a Portfolio will deposit in a segregated account with its custodian
cash or appropriate liquid securities, marked to market daily, in an amount at
least equal to the Portfolio's obligations under the agreement.

FOREIGN SECURITIES (All Portfolios). Each Portfolio may invest in
U.S. dollar-denominated securities of foreign issuers and foreign branches of
U.S. banks, including negotiable certificates of deposit ("CDs"), bankers'
acceptances and commercial paper. Foreign issuers are issuers organized and
doing business principally outside the U.S. and include banks, non-U.S.
governments, and quasi-governmental organizations. While investments in foreign
securities are intended to reduce risk by providing further diversification,
such investments involve sovereign and other risks, in addition to the credit
and market risks normally associated with domestic securities. These additional
risks include the possibility of adverse political and economic developments
(including political instability, nationalization, expropriation, or
confiscatory taxation) and the potentially adverse effects of unavailability of
public information regarding issuers, less governmental supervision and
regulation of financial markets, reduced liquidity of certain financial markets,
and the lack of uniform accounting, auditing, and financial reporting standards
or the application of standards that are different or less stringent than those
applied in the United States.

Each Portfolio also may invest in equity, debt, or other
income-producing securities that are denominated in or indexed to foreign
currencies, including (1) common and preferred stocks, (2) CDs, commercial
paper, fixed time deposits, and bankers' acceptances issued by foreign banks,

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(3) obligations of other corporations, and (4) obligations of foreign
governments and their subdivisions, agencies, and instrumentalities,
international agencies, and supranational entities. Investing in foreign
currency denominated securities involves the special risks associated with
investing in non-U.S. issuers, as described in the preceding paragraph, and the
additional risks of (1) adverse changes in foreign exchange rates, and (2)
adverse changes in investment or exchange control regulations (which could
prevent cash from being brought back to the United States). Additionally,
dividends and interest payable on foreign securities (and gains realized on the
disposition thereof) may be subject to foreign taxes, including taxes withheld
from those payments. Commissions on foreign securities exchanges are often at
fixed rates and are generally higher than negotiated commissions on U.S.
exchanges, although the Portfolios endeavor to achieve the most favorable net
results on portfolio transactions.

Foreign securities often trade with less frequency and in less volume
than domestic securities and therefore may exhibit greater price volatility.
Additional costs associated with an investment in foreign securities may include
higher custodial fees than apply to domestic custody arrangements and
transaction costs of foreign currency conversions.

Foreign markets also have different clearance and settlement
procedures. In certain markets, there have been times when settlements have been
unable to keep pace with the volume of securities transactions, making it
difficult to conduct such transactions. Delays in settlement could result in
temporary periods when a portion of the assets of a Portfolio are uninvested and
no return is earned thereon. The inability of a Portfolio to make intended
security purchases due to settlement problems could cause the Portfolio to miss
attractive investment opportunities. Inability to dispose of portfolio
securities due to settlement problems could result in losses to a Portfolio due
to subsequent declines in value of the securities or, if the Portfolio has
entered into a contract to sell the securities, could result in possible
liability to the purchaser.

Interest rates prevailing in other countries may affect the prices of
foreign securities and exchange rates for foreign currencies. Local factors,
including the strength of the local economy, the demand for borrowing, the
government's fiscal and monetary policies, and the international balance of
payments, often affect interest rates in other countries. Individual foreign
economies may differ favorably or unfavorably from the U.S. economy in such
respects as growth of gross national product, rate of inflation, capital
reinvestment, resource self-sufficiency, and balance of payments position.

The Portfolios may invest in ADRs, EDRs, GDRs, and IDRs. ADRs
(sponsored or unsponsored) are receipts typically issued by a U.S. bank or
trust company evidencing its ownership of the underlying foreign securities.
Most ADRs are denominated in U.S. dollars and are traded on a U.S. stock
exchange. Issuers of the securities underlying sponsored ADRs, but not
unsponsored ADRs, are contractually obligated to disclose material
information in the United States. Therefore, the market value of unsponsored
ADRs may not reflect the effect of such information. EDRs and IDRs are
receipts typically issued by a European bank or trust company evidencing its
ownership of the underlying foreign securities. GDRs are receipts issued by
either a U.S. or non-U.S. banking institution evidencing its ownership of the
underlying foreign securities and are often denominated in U.S. dollars.

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POLICIES AND LIMITATIONS. In order to limit the risks inherent in
investing in foreign currency denominated securities, a Portfolio (except
Neuberger Berman MILLENNIUM Portfolio) may not purchase any such security if, as
a result, more than 10% of its total assets (taken at market value) would be
invested in foreign currency denominated securities. Neuberger Berman MILLENNIUM
Portfolio may not purchase foreign currency denominated securities if, as a
result, more than 20% of its total assets (taken at market value) would be
invested in such securities. Within those limitations, however, no Portfolio is
restricted in the amount it may invest in securities denominated in any one
foreign currency.

Investments in securities of foreign issuers are subject to each
Portfolio's quality standards. Each Portfolio may invest only in securities of
issuers in countries whose governments are considered stable by NB Management.

FUTURES, OPTIONS ON FUTURES, OPTIONS ON SECURITIES AND INDICES,
FORWARD CONTRACTS, AND OPTIONS ON FOREIGN
CURRENCIES (COLLECTIVELY, "FINANCIAL INSTRUMENTS")

FUTURES CONTRACTS AND OPTIONS THEREON For purposes of managing cash
flow, each Portfolio may purchase and sell stock index futures contracts, and
may purchase and sell options thereon, to increase its exposure to the
performance of a recognized securities index, such as the S&P 500 Index.

Each of Neuberger Berman MILLENNIUM and SOCIALLY RESPONSIVE
Portfolios may purchase and sell interest rate futures contracts, stock and bond
index futures contracts, and foreign currency futures contracts and may purchase
and sell options thereon in an attempt to hedge against changes in the prices of
securities or, in the case of foreign currency futures and options thereon, to
hedge against changes in prevailing currency exchange rates. Because the futures
markets may be more liquid than the cash markets, the use of futures contracts
permits the Portfolio to enhance portfolio liquidity and maintain a defensive
position without having to sell portfolio securities. Each of Neuberger Berman
MILLENNIUM and SOCIALLY RESPONSIVE Portfolios views investment in (i) interest
rate and securities index futures and options thereon as a maturity management
device and/or a device to reduce risk or preserve total return in an adverse
environment for the hedged securities, and (ii) foreign currency futures and
options thereon as a means of establishing more definitely the effective return
on, or the purchase price of, securities denominated in foreign currencies that
are held or intended to be acquired by the Portfolio.

A "sale" of a futures contract (or a "short" futures position)
entails the assumption of a contractual obligation to deliver the securities or
currency underlying the contract at a specified price at a specified future
time. A "purchase" of a futures contract (or a "long" futures position) entails
the assumption of a contractual obligation to acquire the securities or currency
underlying the contract at a specified price at a specified future time. Certain
futures, including stock and bond index futures, are settled on a net cash
payment basis rather than by the sale and delivery of the securities underlying
the futures.

U.S. futures contracts (except certain currency futures) are traded
on exchanges that have been designated as "contract markets" by the CFTC;
futures transactions must be executed through a futures commission merchant that

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is a member of the relevant contract market. The exchange's affiliated clearing
organization guarantees performance of the contracts between the clearing
members of the exchange.

Although futures contracts by their terms may require the actual
delivery or acquisition of the underlying securities or currency, in most cases
the contractual obligation is extinguished by being offset before the expiration
of the contract. A futures position is offset by buying (to offset an earlier
sale) or selling (to offset an earlier purchase) an identical futures contract
calling for delivery in the same month. This may result in a profit or loss.
While futures contracts entered into by a Portfolio will usually be liquidated
in this manner, the Portfolio may instead make or take delivery of underlying
securities whenever it appears economically advantageous for it to do so.

"Margin" with respect to a futures contract is the amount of assets
that must be deposited by a Portfolio with, or for the benefit of, a futures
commission merchant in order to initiate and maintain the Portfolio's futures
positions. The margin deposit made by the Portfolio when it enters into a
futures contract ("initial margin") is intended to assure its performance of the
contract. If the price of the futures contract changes - increases in the case
of a short (sale) position or decreases in the case of a long (purchase)
position -- so that the unrealized loss on the contract causes the margin
deposit not to satisfy margin requirements, the Portfolio will be required to
make an additional margin deposit ("variation margin"). However, if favorable
price changes in the futures contract cause the margin deposit to exceed the
required margin, the excess will be paid to the Portfolio. In computing their
NAVs, the Portfolios mark to market the value of their open futures positions.
Each Portfolio also must make margin deposits with respect to options on futures
that it has written (but not with respect to options on futures that it has
purchased). If the futures commission merchant holding the margin deposit goes
bankrupt, the Portfolio could suffer a delay in recovering its funds and could
ultimately suffer a loss.

An option on a futures contract gives the purchaser the right, in
return for the premium paid, to assume a position in the contract (a long
position if the option is a call and a short position if the option is a put) at
a specified exercise price at any time during the option exercise period. The
writer of the option is required upon exercise to assume a short futures
position (if the option is a call) or a long futures position (if the option is
a put). Upon exercise of the option, the accumulated cash balance in the
writer's futures margin account is delivered to the holder of the option. That
balance represents the amount by which the market price of the futures contract
at exercise exceeds, in the case of a call, or is less than, in the case of a
put, the exercise price of the option. Options on futures have characteristics
and risks similar to those of securities options, as discussed herein.

Although each Portfolio believes that the use of futures contracts
will benefit it, if NB Management's judgment about the general direction of the
markets or about interest rate or currency exchange rate trends is incorrect,
the Portfolio's overall return would be lower than if it had not entered into
any such contracts. The prices of futures contracts are volatile and are
influenced by, among other things, actual and anticipated changes in interest or
currency exchange rates, which in turn are affected by fiscal and monetary
policies and by national and international political and economic events. At
best, the correlation between changes in prices of futures contracts and of

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securities being hedged can be only approximate due to differences between the
futures and securities markets or differences between the securities or
currencies underlying a Portfolio's futures position and the securities held by
or to be purchased for the Portfolio. The currency futures market may be
dominated by short-term traders seeking to profit from changes in exchange
rates. This would reduce the value of such contracts used for hedging purposes
over a short-term period. Such distortions are generally minor and would
diminish as the contract approaches maturity.

Because of the low margin deposits required, futures trading involves
an extremely high degree of leverage; as a result, a relatively small price
movement in a futures contract may result in immediate and substantial loss, or
gain, to the investor. Losses that may arise from certain futures transactions
are potentially unlimited.

Most U.S. futures exchanges limit the amount of fluctuation in the
price of a futures contract or option thereon during a single trading day; once
the daily limit has been reached, no trades may be made on that day at a price
beyond that limit. The daily limit governs only price movements during a
particular trading day, however; it thus does not limit potential losses. In
fact, it may increase the risk of loss, because prices can move to the daily
limit for several consecutive trading days with little or no trading, thereby
preventing liquidation of unfavorable futures and options positions and
subjecting traders to substantial losses. If this were to happen with respect to
a position held by a Portfolio, it could (depending on the size of the position)
have an adverse impact on the NAV of the Portfolio.

POLICIES AND LIMITATIONS. For purposes of managing cash flow, each
Portfolio may purchase and sell stock index futures contracts, and may purchase
and sell options thereon, to increase its exposure to the performance of a
recognized securities index, such as the S&P 500.

Neuberger Berman MILLENNIUM and SOCIALLY RESPONSIVE Portfolios each
may purchase and sell futures contracts and may purchase and sell options
thereon in an attempt to hedge against changes in the prices of securities or,
in the case of foreign currency futures and options thereon, to hedge against
prevailing currency exchange rates. The Portfolios do not engage in futures and
options on futures for speculation. The use of futures and options on futures by
Neuberger Berman SOCIALLY RESPONSIVE Portfolio is not subject to the Social
Policy.

CALL OPTIONS ON SECURITIES (ALL PORTFOLIOS). Neuberger Berman
MILLENNIUM and SOCIALLY RESPONSIVE Portfolios each may write covered call
options and may purchase call options on securities. Each of the other
Portfolios may write covered call options and may purchase call options in
related closing transactions. The purpose of writing call options is to hedge
(i.e., to reduce, at least in part, the effect of price fluctuations of
securities held by the Portfolio on the Portfolio's and its corresponding Fund's
net asset values ("NAVs") or to earn premium income. Portfolio securities on
which call options may be written and purchased by a Portfolio are purchased
solely on the basis of investment considerations consistent with the Portfolio's
investment objective.

When a Portfolio writes a call option, it is obligated to sell a
security to a purchaser at a specified price at any time until a certain date if
the purchaser decides to exercise the option. The Portfolio receives a premium

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for writing the call option. So long as the obligation of the call option
continues, the Portfolio may be assigned an exercise notice, requiring it to
deliver the underlying security against payment of the exercise price. The
Portfolio may be obligated to deliver securities underlying an option at less
than the market price.

The writing of covered call options is a conservative investment
technique that is believed to involve relatively little risk but is capable of
enhancing the Portfolios' total return. When writing a covered call option, a
Portfolio, in return for the premium, gives up the opportunity for profit from a
price increase in the underlying security above the exercise price, but
conversely retains the risk of loss should the price of the security decline.

If a call option that a Portfolio has written expires unexercised,
the Portfolio will realize a gain in the amount of the premium; however, that
gain may be offset by a decline in the market value of the underlying security
during the option period. If the call option is exercised, the Portfolio will
realize a gain or loss from the sale of the underlying security.

When a Portfolio purchases a call option, it pays a premium for the
right to purchase a security from the writer at a specified price until a
specified date.

POLICIES AND LIMITATIONS. Each Portfolio may write covered call
options and may purchase call options in related closing transactions. Each
Portfolio writes only "covered" call options on securities it owns (in contrast
to the writing of "naked" or uncovered call options, which the Portfolios will
not do).

A Portfolio would purchase a call option to offset a previously
written call option. Each of Neuberger Berman MILLENNIUM and SOCIALLY RESPONSIVE
Portfolios also may purchase a call option to protect against an increase in the
price of securities it intends to purchase. The use of call options on
securities by Neuberger Berman SOCIALLY RESPONSIVE Portfolio is not subject to
the Social Policy.

PUT OPTIONS ON SECURITIES (NEUBERGER BERMAN MILLENNIUM AND SOCIALLY
RESPONSIVE PORTFOLIOS). These Portfolios may write and purchase put options
on securities.

Each of Neuberger Berman MILLENNIUM and SOCIALLY RESPONSIVE
Portfolios will receive a premium for writing a put option, which obligates the
Portfolio to acquire a security at a certain price at any time until a certain
date if the purchaser decides to exercise the option. The Portfolio may be
obligated to purchase the underlying security at more than its current value.

When Neuberger Berman MILLENNIUM or SOCIALLY RESPONSIVE Portfolio
purchases a put option, it pays a premium to the writer for the right to sell a
security to the writer for a specified amount at any time until a certain date.
The Portfolio would purchase a put option in order to protect itself against a
decline in the market value of a security it owns.

Portfolio securities on which put options may be written and
purchased by Neuberger Berman MILLENNIUM or SOCIALLY RESPONSIVE Portfolio are
purchased solely on the basis of investment considerations consistent with the
Portfolio's investment objective. When writing a put option, the Portfolio, in
return for the premium, takes the risk that it must purchase the underlying

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security at a price that may be higher than the current market price of the
security. If a put option that the Portfolio has written expires unexercised,
the Portfolio will realize a gain in the amount of the premium.

POLICIES AND LIMITATIONS. Each of Neuberger Berman MILLENNIUM and
SOCIALLY RESPONSIVE Portfolios generally writes and purchases put options on
securities for hedging purposes (I.E., to reduce, at least in part, the effect
of price fluctuations of securities held by the Portfolio on the Portfolio's and
its corresponding Fund's NAVs). The use of put options on securities by
Neuberger Berman SOCIALLY RESPONSIVE Portfolio is not subject to the Social
Policy.

GENERAL INFORMATION ABOUT SECURITIES OPTIONS. The exercise price of
an option may be below, equal to, or above the market value of the underlying
security at the time the option is written. Options normally have expiration
dates between three and nine months from the date written. American-style
options are exercisable at any time prior to their expiration date. The
obligation under any option written by a Portfolio terminates upon expiration of
the option or, at an earlier time, when the Portfolio offsets the option by
entering into a "closing purchase transaction" to purchase an option of the same
series. If an option is purchased by a Portfolio and is never exercised or
closed out, the Portfolio will lose the entire amount of the premium paid.

Options are traded both on U.S. national securities exchanges and in
the over-the-counter ("OTC") market. Exchange-traded options in the United
States are issued by a clearing organization affiliated with the exchange on
which the option is listed; the clearing organization in effect guarantees
completion of every exchange-traded option. In contrast, OTC options are
contracts between a Portfolio and a counter-party, with no clearing organization
guarantee. Thus, when a Portfolio writes an OTC option, it generally will be
able to "close out" the option prior to its expiration only by entering into a
closing purchase transaction with the dealer to whom the Portfolio originally
sold the option. There can be no assurance that the Portfolio would be able to
liquidate an OTC option at any time prior to expiration. Unless a Portfolio is
able to effect a closing purchase transaction in a covered OTC call option it
has written, it will not be able to liquidate securities used as cover until the
option expires or is exercised or until different cover is substituted. In the
event of the counter-party's insolvency, a Portfolio may be unable to liquidate
its options position and the associated cover. NB Management monitors the
creditworthiness of dealers with which a Portfolio may engage in OTC options
transactions.

The premium received (or paid) by a Portfolio when it writes (or
purchases) an option is the amount at which the option is currently traded on
the applicable market. The premium may reflect, among other things, the current
market price of the underlying security, the relationship of the exercise price
to the market price, the historical price volatility of the underlying security,
the length of the option period, the general supply of and demand for credit,
and the interest rate environment. The premium received by a Portfolio for
writing an option is recorded as a liability on the Portfolio's statement of
assets and liabilities. This liability is adjusted daily to the option's current
market value.

Closing transactions are effected in order to realize a profit (or
minimize a loss) on an outstanding option, to prevent an underlying security
from being called, or to permit the sale or the put of the underlying security.
Furthermore, effecting a closing transaction permits Neuberger Berman MILLENNIUM

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and SOCIALLY RESPONSIVE Portfolios to write another call option on the
underlying security with a different exercise price or expiration date, or both.
There is, of course, no assurance that a Portfolio will be able to effect
closing transactions at favorable prices. If a Portfolio cannot enter into such
a transaction, it may be required to hold a security that it might otherwise
have sold, in which case it would continue to be at market risk on the security.

A Portfolio will realize a profit or loss from a closing purchase
transaction if the cost of the transaction is less or more than the premium
received from writing the call option. Because increases in the market price of
a call option generally reflect increases in the market price of the underlying
security, any loss resulting from the repurchase of a call option is likely to
be offset, in whole or in part, by appreciation of the underlying security owned
by the Portfolio; however, the Portfolio could be in a less advantageous
position than if it had not written the call option.

A Portfolio pays brokerage commissions or spreads in connection with
purchasing or writing options, including those used to close out existing
positions. From time to time, each of Neuberger Berman MILLENNIUM and SOCIALLY
RESPONSIVE Portfolios may purchase an underlying security for delivery in
accordance with an exercise notice of a call option assigned to it, rather than
delivering the security from its portfolio. In those cases, additional brokerage
commissions are incurred.

The hours of trading for options may not conform to the hours during
which the underlying securities are traded. To the extent that the options
markets close before the markets for the underlying securities, significant
price and rate movements can take place in the underlying markets that cannot be
reflected in the options markets.

POLICIES AND LIMITATIONS. Each Portfolio may use American-style
options.

The assets used as cover (or held in a segregated account) for OTC
options written by a Portfolio will be considered illiquid unless the OTC
options are sold to qualified dealers who agree that the Portfolio may
repurchase any OTC option it writes at a maximum price to be calculated by a
formula set forth in the option agreement. The cover for an OTC call option
written subject to this procedure will be considered illiquid only to the extent
that the maximum repurchase price under the formula exceeds the intrinsic value
of the option.

The use of put and call options by Neuberger Berman SOCIALLY
RESPONSIVE Portfolio is not subject to the Social Policy.

PUT AND CALL OPTIONS ON SECURITIES INDICES (ALL PORTFOLIOS). For
purposes of managing cash flow, each Portfolio may purchase put and call options
on securities indices to increase the Portfolio's exposure to the performance of
a recognized securities index, such as the S&P 500 Index.

Unlike a securities option, which gives the holder the right to
purchase or sell a specified security at a specified price, an option on a
securities index gives the holder the right to receive a cash "exercise
settlement amount" equal to (1) the difference between the exercise price of the

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option and the value of the underlying securities index on the exercise date (2)
multiplied by a fixed "index multiplier." A securities index fluctuates with
changes in the market values of the securities included in the index. Options on
stock indices are currently traded on the Chicago Board Options Exchange, the
New York Stock Exchange ("NYSE"), the American Stock Exchange, and other U.S.
and foreign exchanges.

The effectiveness of hedging through the purchase of securities index
options will depend upon the extent to which price movements in the securities
being hedged correlate with price movements in the selected securities index.
Perfect correlation is not possible because the securities held or to be
acquired by the Portfolio will not exactly match the composition of the
securities indices on which options are available.

Securities index options have characteristics and risks similar to
those of securities options, as discussed herein.

POLICIES AND LIMITATIONS. For purposes of managing cash flow, each
Portfolio may purchase put and call options on securities indices to increase
the Portfolio's exposure to the performance of a recognized securities index,
such as the S&P 500 Index. All securities index options purchased by a Portfolio
will be listed and traded on an exchange.

FOREIGN CURRENCY TRANSACTIONS (ALL PORTFOLIOS). Each Portfolio may
enter into contracts for the purchase or sale of a specific currency at a future
date (usually less than one year from the date of the contract) at a fixed price
("forward contracts"). The Portfolios also may engage in foreign currency
exchange transactions on a spot (i.e., cash) basis at the spot rate prevailing
in the foreign currency exchange market.

The Portfolios enter into forward contracts in an attempt to hedge
against changes in prevailing currency exchange rates. The Portfolios do not
engage in transactions in forward contracts for speculation; they view
investments in forward contracts as a means of establishing more definitely the
effective return on, or the purchase price of, securities denominated in foreign
currencies. Forward contract transactions include forward sales or purchases of
foreign currencies for the purpose of protecting the U.S. dollar value of
securities held or to be acquired by a Portfolio or protecting the U.S. dollar
equivalent of dividends, interest, or other payments on those securities.

Forward contracts are traded in the interbank market directly between
dealers (usually large commercial banks) and their customers. A forward contract
generally has no deposit requirement, and no commissions are charged at any
stage for trades; foreign exchange dealers realize a profit based on the
difference (the spread) between the prices at which they are buying and selling
various currencies.

At the consummation of a forward contract to sell currency, a
Portfolio may either make delivery of the foreign currency or terminate its
contractual obligation to deliver by purchasing an offsetting contract. If the
Portfolio chooses to make delivery of the foreign currency, it may be required
to obtain such currency through the sale of portfolio securities denominated in
such currency or through conversion of other assets of the Portfolio into such
currency. If the Portfolio engages in an offsetting transaction, it will incur a
gain or a loss to the extent that there has been a change in forward contract

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prices. Closing purchase transactions with respect to forward contracts are
usually made with the currency dealer who is a party to the original forward
contract.

NB Management believes that the use of foreign currency hedging
techniques, including "proxy-hedges," can provide significant protection of NAV
in the event of a general rise in the U.S. dollar against foreign currencies.
For example, the return available from securities denominated in a particular
foreign currency would diminish if the value of the U.S. dollar increased
against that currency. Such a decline could be partially or completely offset by
an increase in value of a hedge involving a forward contract to sell that
foreign currency or a proxy-hedge involving a forward contract to sell a
different foreign currency whose behavior is expected to resemble the currency
in which the securities being hedged are denominated but which is available on
more advantageous terms.

However, a hedge or proxy-hedge cannot protect against exchange rate
risks perfectly, and, if NB Management is incorrect in its judgment of future
exchange rate relationships, a Portfolio could be in a less advantageous
position than if such a hedge had not been established. If a Portfolio uses
proxy-hedging, it may experience losses on both the currency in which it has
invested and the currency used for hedging if the two currencies do not vary
with the expected degree of correlation. Using forward contracts to protect the
value of a Portfolio's securities against a decline in the value of a currency
does not eliminate fluctuations in the prices of underlying securities. Because
forward contracts are not traded on an exchange, the assets used to cover such
contracts may be illiquid. A Portfolio may experience delays in the settlement
of its foreign currency transactions.

POLICIES AND LIMITATIONS. The Portfolios may enter into forward
contracts for the purpose of hedging and not for speculation. The use of forward
contracts by Neuberger Berman SOCIALLY RESPONSIVE Portfolio is not subject to
the Social Policy.

OPTIONS ON FOREIGN CURRENCIES (ALL PORTFOLIOS). Each Portfolio may
write and purchase covered call and put options on foreign currencies.

Currency options have characteristics and risks similar to those of
securities options, as discussed herein. Certain options on foreign currencies
are traded on the OTC market and involve liquidity and credit risks that may not
be present in the case of exchange-traded currency options.

POLICIES AND LIMITATIONS. A Portfolio would use options on foreign
currencies to protect against declines in the U.S. dollar value of portfolio
securities or increases in the U.S. dollar cost of securities to be acquired or
to protect the U.S. dollar equivalent of dividends, interest, or other payments
on those securities. The use of call options on currencies by Neuberger Berman
SOCIALLY RESPONSIVE Portfolio is not subject to the Social Policy.

REGULATORY LIMITATIONS ON USING FINANCIAL INSTRUMENTS. To the extent
a Portfolio writes options on foreign currencies that are traded on an exchange
regulated by the Commodity Futures Trading Commission ("CFTC") other than for
BONA FIDE hedging purposes (as defined by the CFTC), the aggregate initial

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<PAGE>

margin and premiums on those positions (excluding the amount by which options
are "in-the-money") may not exceed 5% of the Portfolio's net assets.

COVER FOR FINANCIAL INSTRUMENTS. Securities held in a segregated
account cannot be sold while the options or forward strategy covered by those
securities is outstanding, unless they are replaced with other suitable assets.
As a result, segregation of a large percentage of a Portfolio's assets could
impede portfolio management or the Portfolio's ability to meet current
obligations. A Portfolio may be unable to promptly dispose of assets which
cover, or are segregated with respect to, an illiquid options or forward
position; this inability may result in a loss to the Portfolio.

POLICIES AND LIMITATIONS. Each Portfolio will comply with SEC
guidelines regarding "cover" for Financial Instruments and, if the guidelines so
require, set aside in a segregated account with its custodian the prescribed
amount of cash or appropriate liquid securities.

GENERAL RISKS OF FINANCIAL INSTRUMENTS. The primary risks in using
Financial Instruments are (1) imperfect correlation or no correlation between
changes in market value of the securities or currencies held or to be acquired
by a Portfolio and the prices of Financial Instruments; (2) possible lack of a
liquid secondary market for Financial Instruments and the resulting inability to
close out Financial Instruments when desired; (3) the fact that the skills
needed to use Financial Instruments are different from those needed to select a
Portfolio's securities; (4) the fact that, although use of Financial Instruments
for hedging purposes can reduce the risk of loss, they also can reduce the
opportunity for gain, or even result in losses, by offsetting favorable price
movements in hedged investments; and (5) the possible inability of a Portfolio
to purchase or sell a portfolio security at a time that would otherwise be
favorable for it to do so, or the possible need for a Portfolio to sell a
portfolio security at a disadvantageous time, due to its need to maintain cover
or to segregate securities in connection with its use of Financial Instruments.
There can be no assurance that a Portfolio's use of Financial Instruments will
be successful.

Each Portfolio's use of Financial Instruments may be limited by the
provisions of the Internal Revenue Code of 1986, as amended ("Code"), with which
it must comply if its corresponding Fund is to continue to qualify as a
regulated investment company ("RIC"). See "Additional Tax Information."

POLICIES AND LIMITATIONS. NB Management intends to reduce the risk of
imperfect correlation by investing only in Financial Instruments whose behavior
is expected to resemble or offset that of a Portfolio's underlying securities or
currency. NB Management intends to reduce the risk that a Portfolio will be
unable to close out Financial Instruments by entering into such transactions
only if NB Management believes there will be an active and liquid secondary
market.

FIXED INCOME SECURITIES (ALL PORTFOLIOS). While the emphasis of the
Portfolios' investment programs is on common stocks and other equity securities,
the Portfolios may also invest in money market instruments, U.S. Government and
Agency Securities, and other fixed income securities. Each Portfolio may invest
in investment grade corporate bonds and debentures. Neuberger Berman PARTNERS
Portfolio may invest in corporate debt securities rated below investment grade.

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<PAGE>

U.S. Government Securities are obligations of the U.S. Treasury
backed by the full faith credit of the United States. U.S. Government Agency
Securities are issued or guaranteed by U.S. Government agencies or by
instrumentalities of the U.S. Government, such as the Government National
Mortgage Association, Fannie Mae (also known as Federal National Mortgage
Association), Freddie Mac (also known as Federal Home Loan Mortgage
Corporation), Student Loan Marketing Association (commonly known as "Sallie
Mae"), and the Tennessee Valley Authority. Some U.S. Government Agency
Securities are supported by the full faith and credit of the United States,
while others may be supported by the issuer's ability to borrow from the U.S.
Treasury, subject to the Treasury's discretion in certain cases, or only by the
credit of the issuer. U.S. Government Agency Securities include U.S. Government
Agency mortgage-backed securities. The market prices of U.S. Government and
Agency Securities are not guaranteed by the Government.

"Investment grade" debt securities are those receiving one of the
four highest ratings from Moody's Investors Service, Inc. ("Moody's"), Standard
& Poor's ("S&P"), or another nationally recognized statistical rating
organization ("NRSRO") or, if unrated by any NRSRO, deemed by NB Management to
be comparable to such rated securities ("Comparable Unrated Securities").
Securities rated by Moody's in its fourth highest rating category (Baa) or
Comparable Unrated Securities may be deemed to have speculative characteristics.

The ratings of an NRSRO represent its opinion as to the quality of
securities it undertakes to rate. Ratings are not absolute standards of quality;
consequently, securities with the same maturity, coupon, and rating may have
different yields. Although the Portfolios may rely on the ratings of any NRSRO,
the Portfolios primarily refer to ratings assigned by S&P and Moody's, which are
described in Appendix A to this SAI.

Fixed income securities are subject to the risk of an issuer's
inability to meet principal and interest payments on its obligations ("credit
risk") and are subject to price volatility due to such factors as interest rate
sensitivity, market perception of the creditworthiness of the issuer, and market
liquidity ("market risk"). The value of the fixed income securities in which a
Portfolio may invest is likely to decline in times of rising market interest
rates. Conversely, when rates fall, the value of a Portfolio's fixed income
investments is likely to rise. Foreign debt securities are subject to risks
similar to those of other foreign securities.

Lower-rated securities are more likely to react to developments
affecting market and credit risk than are more highly rated securities, which
react primarily to movements in the general level of interest rates. Debt
securities in the lowest rating categories may involve a substantial risk of
default or may be in default. Changes in economic conditions or developments
regarding the individual issuer are more likely to cause price volatility and
weaken the capacity of the issuer of such securities to make principal and
interest payments than is the case for higher-grade debt securities. An economic
downturn affecting the issuer may result in an increased incidence of default.
The market for lower-rated securities may be thinner and less active than for
higher-rated securities. Pricing of thinly traded securities requires greater
judgment than pricing of securities for which market transactions are regularly
reported. NB Management will invest in lower-rated securities only when it
concludes that the anticipated return on such an investment to Neuberger Berman
PARTNERS Portfolio warrants exposure to the additional level of risk.

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<PAGE>

POLICIES AND LIMITATIONS. Each Portfolio normally may invest up to
35% of its total assets in debt securities. Neuberger Berman PARTNERS Portfolio
may invest up to 15% of its net assets in corporate debt securities rated below
investment grade or Comparable Unrated Securities.

Subsequent to its purchase by a Portfolio, an issue of debt
securities may cease to be rated or its rating may be reduced, so that the
securities would no longer be eligible for purchase by that Portfolio. In such a
case, Neuberger Berman MILLENNIUM and SOCIALLY RESPONSIVE Portfolios will engage
in an orderly disposition of the downgraded securities. Each other Portfolio
will engage in an orderly disposition of the downgraded securities to the extent
necessary to ensure that the Portfolio's holdings of securities rated below
investment grade and Comparable Unrated Securities will not exceed 5% of its net
assets (15% in the case of Neuberger Berman PARTNERS Portfolio).

COMMERCIAL PAPER (ALL PORTFOLIOS). Commercial paper is a
short-term debt security issued by a corporation or bank, usually for
purposes such as financing current operations.

Each Portfolio may invest in commercial paper that cannot be resold
to the public without an effective registration statement under the 1933 Act.
While restricted commercial paper normally is deemed illiquid, NB Management may
in certain cases determine that such paper is liquid, pursuant to guidelines
established by the Portfolio Trustees.

POLICIES AND LIMITATIONS. The Portfolios may invest in commercial
paper only if it has received the highest rating from S&P (A-1) or Moody's (P-1)
or is deemed by NB Management to be of comparable quality.

ZERO COUPON SECURITIES (NEUBERGER BERMAN PARTNERS, MILLENNIUM AND
SOCIALLY RESPONSIVE PORTFOLIOS). These Portfolios may invest in zero coupon
securities, which are debt obligations that do not entitle the holder to any
periodic payment of interest prior to maturity or that specify a future date
when the securities begin to pay current interest. Zero coupon securities are
issued and traded at a discount from their face amount or par value. This
discount varies depending on prevailing interest rates, the time remaining until
cash payments begin, the liquidity of the security, and the perceived credit
quality of the issuer.

The discount on zero coupon securities ("original issue discount")
must be taken into income ratably by each such Portfolio prior to the receipt of
any actual payments. Because the corresponding fund must distribute
substantially all of its net income (including its share of the Portfolio's
accrued original issue discount) to its shareholders each year for income and
excise tax purposes, each such Portfolio may have to dispose of portfolio
securities under disadvantageous circumstances to generate cash, or may be
required to borrow, to satisfy that Fund's distribution requirements. See
"Additional Tax Information."

The market prices of zero coupon securities generally are more
volatile than the prices of securities that pay interest periodically. Zero
coupon securities are likely to respond to changes in interest rates to a
greater degree than other types of debt securities having a similar maturity and
credit quality.

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CONVERTIBLE SECURITIES (ALL PORTFOLIOS). Each Portfolio may invest in
convertible securities. A convertible security is a bond, debenture, note,
preferred stock, or other security that may be converted into or exchanged for a
prescribed amount of common stock of the same or different issuer within a
particular period of time at a specified price or formula. Convertible
securities generally have features of both common stocks and debt securities. A
convertible security entitles the holder to receive the interest paid or accrued
on debt or the dividend paid on preferred stock until the convertible security
matures or is redeemed, converted or exchanged. Before conversion, such
securities ordinarily provide a stream of income with generally higher yields
than common stocks of the same or similar issuers, but lower than the yield on
non-convertible debt. Convertible securities are usually subordinated to
comparable-tier non-convertible securities but rank senior to common stock in a
corporation's capital structure. The value of a convertible security is a
function of (1) its yield in comparison to the yields of other securities of
comparable maturity and quality that do not have a conversion privilege and (2)
its worth if converted into the underlying common stock.

The price of a convertible security often reflects variations in the
price of the underlying common stock in a way that non-convertible debt may not.
Convertible securities are typically issued by smaller capitalization companies
whose stock prices may be volatile. A convertible security may be subject to
redemption at the option of the issuer at a price established in the security's
governing instrument. If a convertible security held by a Portfolio is called
for redemption, the Portfolio will be required to convert it into the underlying
common stock, sell it to a third party or permit the issuer to redeem the
security. Any of these actions could have an adverse effect on the Portfolio's
and its corresponding Fund's ability to achieve their investment objectives.

POLICIES AND LIMITATIONS. Neuberger Berman SOCIALLY RESPONSIVE
Portfolio may invest up to 20% of its net assets in convertible securities. The
Portfolio does not intend to purchase any convertible securities that are not
investment grade. Convertible debt securities are subject to each Portfolio's
investment policies and limitations concerning fixed income securities.

PREFERRED STOCK (ALL PORTFOLIOS). Each Portfolio may invest in
preferred stock. Unlike interest payments on debt securities, dividends on
preferred stock are generally payable at the discretion of the issuer's board of
directors. Preferred shareholders may have certain rights if dividends are not
paid but generally have no legal recourse against the issuer. Shareholders may
suffer a loss of value if dividends are not paid. The market prices of preferred
stocks are generally more sensitive to changes in the issuer's creditworthiness
than are the prices of debt securities.

OTHER INVESTMENT COMPANIES. For purposes of managing cash flow, each
Portfolio at times may invest in instruments structured as investment companies
to gain exposure to the performance of a recognized securities index, such as
the S&P 500.

As a shareholder in an investment company, a Portfolio would bear its
pro rata share of that investment company's expenses. Investment in other funds
may involve the payment of substantial premiums above the value of such issuer's
portfolio securities. The Portfolios do not intend to invest in such funds
unless, in the judgment of NB Management, the potential benefits of such
investment justify the payment of any applicable premium or sales charge.

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<PAGE>

POLICIES AND LIMITATIONS. Each Portfolio's investment in such
securities is limited to (i) 3% of the total voting stock of any one investment
company, (ii) 5% of the Portfolio's total assets with respect to any one
investment company and (iii) 10% of the Portfolio's total assets in the
aggregate.

Neuberger Berman FOCUS Portfolio - Description of Economic Sectors.
- ------------------------------------------------------------------

Neuberger Berman FOCUS Portfolio seeks to achieve its investment
objective by investing principally in common stocks in the following thirteen
multi-industry economic sectors, normally making at least 90% of its investments
in not more than six such sectors:

(1) AUTOS AND HOUSING SECTOR: Companies engaged in design, production, or
sale of automobiles, automobile parts, mobile homes, or related products
("automobile industries") or design, construction, renovation, or refurbishing
of residential dwellings. The value of securities of companies in the automobile
industries is affected by, among other things, foreign competition, the level of
consumer confidence and consumer debt, and installment loan rates. The housing
construction industry may be affected by the level of consumer confidence and
consumer debt, mortgage rates, tax laws, and the inflation outlook.

(2) CONSUMER GOODS AND SERVICES SECTOR: Companies engaged in providing
consumer goods or services, including design, processing, production, sale, or
storage of packaged, canned, bottled, or frozen foods and beverages and design,
production, or sale of home furnishings, appliances, clothing, accessories,
cosmetics, or perfumes. Certain of these companies are subject to government
regulation affecting the use of various food additives and production methods,
which could affect profitability. Also, the success of food- and fashion-related
products may be strongly affected by fads, marketing campaigns, health concerns,
and other factors affecting supply and demand.

(3) DEFENSE AND AEROSPACE SECTOR: Companies engaged in research,
manufacture, or sale of products or services related to the defense or aerospace
industries, including air transport; data processing or computer-related
services; communications systems; military weapons or transportation; general
aviation equipment, missiles, space launch vehicles, or spacecraft; machinery
for guidance, propulsion, or control of flight vehicles; and airborne or
ground-based equipment essential to the test, operation, or maintenance of
flight vehicles. Because these companies rely largely on U.S. (and foreign)
governmental demand for their products and services, their financial conditions
are heavily influenced by defense spending policies.

(4) ENERGY SECTOR: Companies involved in the production, transmission, or
marketing of energy from oil, gas, or coal, as well as nuclear, geothermal, oil
shale, or solar sources of energy (but excluding public utility companies). Also
included are companies that provide component products or services for those
activities. The value of these companies' securities varies based on the price
and supply of energy fuels and may be affected by international politics, energy
conservation, the success of exploration projects, environmental considerations,
and the tax and other regulatory policies of various governments.

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<PAGE>

(5) FINANCIAL SERVICES SECTOR: Companies providing financial services to
consumers or industry, including commercial banks and savings and loan
associations, consumer and industrial finance companies, securities brokerage
companies, leasing companies, and insurance companies. These companies are
subject to extensive governmental regulations. Their profitability may fluctuate
significantly as a result of volatile interest rates, concerns about particular
banks and savings institutions, and general economic conditions.

(6) HEALTH CARE SECTOR: Companies engaged in design, manufacture, or sale
of products or services used in connection with the provision of health care,
including pharmaceutical companies; firms that design, manufacture, sell, or
supply medical, dental, or optical products, hardware, or services; companies
involved in biotechnology, medical diagnostic, or biochemical research and
development; and companies that operate health care facilities. Many of these
companies are subject to government regulation and potential health care
reforms, which could affect the price and availability of their products and
services. Also, products and services of these companies could quickly become
obsolete.

(7) HEAVY INDUSTRY SECTOR: Companies engaged in research, development,
manufacture, or marketing of products, processes, or services related to the
agriculture, chemicals, containers, forest products, non-ferrous metals, steel,
or pollution control industries, including synthetic and natural materials (for
example, chemicals, plastics, fertilizers, gases, fibers, flavorings, or
fragrances), paper, wood products, steel, and cement. Certain of these companies
are subject to state and federal regulation, which could require alteration or
cessation of production of a product, payment of fines, or cleaning of a
disposal site. Furthermore, because some of the materials and processes used by
these companies involve hazardous components, there are additional risks
associated with their production, handling, and disposal. The risk of product
obsolescence also is present.

(8) MACHINERY AND EQUIPMENT SECTOR: Companies engaged in the research,
development, or manufacture of products, processes, or services relating to
electrical equipment, machinery, pollution control, or construction services,
including transformers, motors, turbines, hand tools, earth-moving equipment,
and waste disposal services. The profitability of most of these companies may
fluctuate significantly in response to capital spending and general economic
conditions. As is the case for the heavy industry sector, there are risks
associated with the production, handling, and disposal of materials and
processes that involve hazardous components and the risk of product
obsolescence.

(9) MEDIA AND ENTERTAINMENT SECTOR: Companies engaged in design,
production, or distribution of goods or services for the media industries
(including television or radio broadcasting or manufacturing, publishing,
recordings and musical instruments, motion pictures, and photography) and the
entertainment industries (including sports arenas, amusement and theme parks,
gaming casinos, sporting goods, camping and recreational equipment, toys and
games, travel-related services, hotels and motels, and fast food and other
restaurants). Many products produced by companies in this sector --for example,
video and electronic games --may become obsolete quickly. Additionally,
companies engaged in television and radio broadcast are subject to government
regulation.

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<PAGE>

(10) RETAILING SECTOR: Companies engaged in retail distribution of home
furnishings, food products, clothing, pharmaceuticals, leisure products, or
other consumer goods, including department stores, supermarkets, and retail
chains specializing in particular items such as shoes, toys, or pharmaceuticals.
The value of these companies' securities fluctuates based on consumer spending
patterns, which depend on inflation and interest rates, the level of consumer
debt, and seasonal shopping habits. The success or failure of a company in this
highly competitive sector depends on its ability to predict rapidly changing
consumer tastes.

(11) TECHNOLOGY SECTOR: Companies that are expected to have or develop
products, processes, or services that will provide, or will benefit
significantly from, technological advances and improvements or future automation
trends, including semiconductors, computers and peripheral equipment, scientific
instruments, computer software, telecommunications equipment, and electronic
components, instruments, and systems. These companies are sensitive to foreign
competition and import tariffs. Also, many of their products may become obsolete
quickly.

(12) TRANSPORTATION SECTOR: Companies involved in providing transportation
of people and products, including airlines, railroads, and trucking firms.
Revenues of these companies are affected by fluctuations in fuel prices and
government regulation of fares.

(13) UTILITIES SECTOR: Companies in the public utilities industry and
companies that derive a substantial majority of their revenues through supplying
public utilities (including companies engaged in the manufacture, production,
generation, transmission, or sale of gas and electric energy) and that provide
telephone, telegraph, satellite, microwave, and other communication facilities
to the public. The gas and electric public utilities industries are subject to
various uncertainties, including the outcome of political issues concerning the
environment, prices of fuel for electric generation, availability of natural
gas, and risks associated with the construction and operation of nuclear power
facilities.

Neuberger Berman SOCIALLY RESPONSIVE Portfolio - Description of Social Policy
- -----------------------------------------------------------------------------

BACKGROUND INFORMATION ON SOCIALLY RESPONSIVE INVESTING

In an era when many people are concerned about the relationship
between business and society, socially responsive investing ("SRI") is a
mechanism for assuring that investors' social values are reflected in their
investment decisions. As such, SRI is a direct descendent of the successful
effort begun in the early 1970's to encourage companies to divest their South
African operations and subscribe to the Sullivan Principles. Today, a growing
number of individuals and institutions are applying similar strategies to a
broad range of problems.

Although there are many strategies available to the socially
responsive investor, including proxy activism, below-market loans to community
projects, and venture capital, the SRI strategies used by the Portfolio
generally fall into two categories:

AVOIDANCE INVESTING. Most socially responsive investors seek to avoid
holding securities of companies whose products or policies are seen as being at
odds with the social good. The most common exclusions historically have involved

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<PAGE>

tobacco companies and weapons manufacturers.

LEADERSHIP INVESTING. A growing number of investors actively look for
companies with progressive programs that are exemplary or companies which make
it their business to try to solve some of the problems of today's society.

The marriage of social and financial objectives would not have
surprised Adam Smith, who was, first and foremost, a moral philosopher. THE
WEALTH OF NATIONS is firmly rooted in the Enlightenment conviction that the
purpose of capital is the social good and the related belief that idle capital
is both wasteful and unethical. But, what very likely would have surprised Smith
is the sheer complexity of the social issues we face today and the diversity of
our attitudes toward the social good. War and peace, race and gender, the
distribution of wealth, and the conservation of natural resources -- the social
agenda is long and compelling. It is also something about which reasonable
people differ. What should society's priorities be? What can and should be done
about them? And what is the role of business in addressing them? Since
corporations are on the front lines of so many key issues in today's world, a
growing number of investors feel that a corporation's role cannot be ignored.
This is true of some of the most important issues of the day such as equal
opportunity and the environment.

THE SOCIALLY RESPONSIVE DATABASE

Neuberger Berman, LLC ("Neuberger Berman"), the Portfolio's
sub-adviser, maintains a database of information about the social impact of the
companies it follows. NB Management uses the database to evaluate social issues
after it deems a stock acceptable from a financial standpoint for acquisition by
the Portfolio. The aim of the database is to be as comprehensive as possible,
given that much of the information concerning corporate responsibility comes
from subjective sources. Information for the database is gathered by Neuberger
Berman in many categories and then analyzed by NB Management in the following
six categories of corporate responsibility:

WORKPLACE DIVERSITY AND EMPLOYMENT. NB Management looks for companies
that show leadership in areas such as employee training and promotion policies
and benefits, such as flextime, generous profit sharing, and parental leave. NB
Management looks for active programs to promote women and minorities and takes
into account their representation among the officers of an issuer and members of
its board of directors. As a basis for exclusion, NB Management looks for Equal
Employment Opportunity Act infractions and Occupational Safety and Health Act
violations; examines each case in terms of severity, frequency, and time elapsed
since the incident; and considers actions taken by the company since the
violation. NB Management also monitors companies' progress and attitudes toward
these issues.

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<PAGE>

ENVIRONMENT. A company's impact on the environment depends largely on
the industry. Therefore, NB Management examines a company's environmental record
vis-a-vis those of its peers in the industry. All companies operating in an
industry with inherently high environmental risks are likely to have had
problems in such areas as toxic chemical emissions, federal and state fines, and
Superfund sites. For these companies, NB Management examines their problems in
terms of severity, frequency, and elapsed time. NB Management then balances the
record against whatever leadership the company may have demonstrated in terms of
environmental policies, procedures, and practices. NB Management defines an
environmental leadership company as one that puts into place strong affirmative
programs to minimize emissions, promote safety, reduce waste at the source,
insure energy conservation, protect natural resources, and incorporate recycling
into its processes and products. NB Management looks for the commitment and
active involvement of senior management in all these areas. Several major
manufacturers which still produce substantial amounts of pollution are among the
leaders in developing outstanding waste source reduction and remediation
programs.

PRODUCT. NB Management considers company announcements, press
reports, and public interest publications relating to the health, safety,
quality, labeling, advertising, and promotion of both consumer and industrial
products. NB Management takes note of companies with a strong commitment to
quality and with marketing practices which are ethical and consumer-friendly. NB
Management pays particular attention to companies whose products and services
promote progressive solutions to social problems.

PUBLIC HEALTH. NB Management measures the participation of companies
in such industries and markets as alcohol, tobacco, gambling and nuclear power.
NB Management also considers the impact of products and marketing activities
related to those products on nutritional and other health concerns, both
domestically and in foreign markets.

WEAPONS. NB Management keeps track of domestic military sales and,
whenever possible, foreign military sales and categorizes them as nuclear
weapons related, other weapons related, and non-weapon military supplies, such
as micro-chip manufacturers and companies that make uniforms for military
personnel.

CORPORATE CITIZENSHIP. NB Management gathers information about a
company's participation in community affairs, its policies with respect to
charitable contributions, and its support of education and the arts. NB
Management looks for companies with a focus, dealing with issues not just by
making financial contributions, but also by asking the questions: What can we do
to help? What do we have to offer? Volunteerism, high-school mentoring programs,
scholarships and grants, and in-kind donations to specific groups are just a few
ways that companies have responded to these questions.

IMPLEMENTATION OF SOCIAL POLICY

Companies deemed acceptable by NB Management from a financial
standpoint are analyzed using Neuberger Berman's database. The companies are
then evaluated by the portfolio manager to determine if the companies' policies,
practices, products, and services withstand scrutiny in the following major
areas of concern: the environment and workplace diversity and employment.

36
<PAGE>

Companies are then further evaluated to determine their track record in issues
and areas of concern such as public health, weapons, product, and corporate
citizenship.

The issues and areas of concern that are tracked lend themselves to
objective analysis in varying degrees. Few, however, can be resolved entirely on
the basis of scientifically demonstrable facts. Moreover, a substantial amount
of important information comes from sources that do not purport to be
disinterested. Thus, the quality and usefulness of the information in the
database depend on Neuberger Berman's ability to tap a wide variety of sources
and on the experience and judgment of the people at NB Management who interpret
the information.

In applying the information in the database to stock selection for
the Portfolio, NB Management considers several factors. NB Management examines
the severity and frequency of various infractions, as well as the time elapsed
since their occurrence. NB Management also takes into account any remedial
action which has been taken by the company relating to these infractions. NB
Management notes any quality innovations made by the company in its effort to
create positive change and looks at the company's overall approach to social
issues.

PERFORMANCE INFORMATION

Each Fund's performance figures are based on historical results and
are not intended to indicate future performance. The share price and total
return of each Fund will vary, and an investment in a Fund, when redeemed, may
be worth more or less than an investor's original cost.

Total Return Computations
- -------------------------

Each Fund may advertise certain total return information. An average
annual compounded rate of return ("T") may be computed by using the redeemable
value at the end of a specified period ("ERV") of a hypothetical initial
investment of $1,000 ("P") over a period of time ("n") according to the formula:

n
P(1+T) = ERV

Average annual total return smoothes out year-to-year variations in
performance and, in that respect, differs from actual year-to-year results.

The Funds commenced operations in August or September 1996, except
for Neuberger Berman GENESIS Assets, which commenced operations in April 1997,
and Neuberger Berman MILLENNIUM Assets, which commenced operations on December
1, 1999. However, six mutual funds that are series of Neuberger Berman Equity
Funds ("Equity Funds"), each of which has a name similar to a Fund and the same
investment objective, policies, and limitations as that Fund ("Sister Fund"),
also invest in the six Portfolios described herein. Each Sister Fund had a
predecessor. The following total return data is for each Fund since its
inception and, for periods prior to each Fund's inception, its Sister Fund

37
<PAGE>

(which, as used herein, includes data for that Sister Fund's predecessor). The
Sister Funds have a different fee structure than the Funds and do not pay 12b-1
fees. Had the higher fees of the Funds been reflected, the total returns shown
below would have been lower.

Average Annual Total Returns
Periods Ended 8/31/1999

One Year Five Years Ten Years Period from Inception
-------- ---------- --------- ---------------------

MANHATTAN +36.09% +15.31% +12.04% +16.70%
GENESIS +18.75% +15.07% +11.35% +13.05%
FOCUS +43.15% +17.39% +14.69% +12.23%
GUARDIAN +25.25% +12.28% +12.16% +12.80%
PARTNERS +25.51% +17.81% +13.86% +17.54%
SOCIALLY +36.80% +19.16% N/A +17.55%
RESPONSIVE

Prior to January 5, 1989, the investment policies of Neuberger Berman
FOCUS Assets' Sister Fund required that at least 80% of its investments normally
be in energy-related investments; prior to November 1, 1991, those investment
policies required that at least 25% of its investments normally be in the energy
sector. Neuberger Berman FOCUS Assets may include information reflecting the
Sister Fund's performance and expenses for periods before November 1, 1991, in
its advertisements, sales literature, financial statements, and other documents
filed with the SEC and/or provided to current and prospective shareholders.
Investors should be aware that such information may not necessarily reflect the
level of performance and expenses that would have been experienced had the
Fund's current investment policies been in effect.

NB Management may from time to time waive a portion of its fees due
from any Fund or Portfolio or reimburse a Fund or Portfolio for a portion of its
expenses. Such action has the effect of increasing total return. Actual
reimbursements and waivers are described in the Prospectus and in "Investment
Management and Administration Services" below.

Comparative Information
- -----------------------

From time to time each Fund's performance may be compared with:

(1) data (that may be expressed as rankings or ratings) published by
independent services or publications (including newspapers, newsletters,
and financial periodicals) that monitor the performance of mutual funds,
such as Lipper Analytical Services, Inc., C.D.A. Investment Technologies,
Inc., Wiesenberger Investment Companies Service, Investment Company Data
Inc., Morningstar, Inc., Micropal Incorporated, and quarterly mutual fund
rankings by Money, Fortune, Forbes, Business Week, Personal Investor, and
U.S. News & World Report magazines, The Wall Street Journal, The New York

38
<PAGE>

Times, Kiplinger's Personal Finance, and Barron's Newspaper, or

(2) recognized stock and other indices, such as the S&P 500 Composite
Stock Price Index ("S&P 500 Index"), S&P Small Cap 600 Index ("S&P 600
Index"), S&P Mid Cap 400 Index ("S&P 400 Index"), Russell 2000 Stock
Index, Russell Midcap Growth Index, Dow Jones Industrial Average ("DJIA"),
Wilshire 1750 Index, Nasdaq Composite Index, Montgomery Securities Growth
Stock Index, Value Line Index, U.S. Department of Labor Consumer Price
Index ("Consumer Price Index"), College Board Annual Survey of Colleges,
Kanon Bloch's Family Performance Index, the Barra Growth Index, the Barra
Value Index, and various other domestic, international, and global
indices. The S&P 500 Index is a broad index of common stock prices, while
the DJIA represents a narrower segment of industrial companies. The S&P
600 Index includes stocks that range in market value from $35 million to
$6.1 billion, with an average of $572 million. The S&P 400 Index measures
mid-sized companies that have an average market capitalization of $2.1
billion. Each assumes reinvestment of distributions and is calculated
without regard to tax consequences or the costs of investing. Each
Portfolio may invest in different types of securities from those included
in some of the above indices.

Neuberger Berman SOCIALLY RESPONSIVE Fund's performance may also be
compared to various socially responsive indices. These include The Domini Social
Index and the indices developed by the quantitative department of Prudential
Securities, such as that department's Large and Mid-Cap portfolio indices for
various breakdowns ("Sin" Stock Free, Cigarette-Stock Free, S&P Composite,
etc.).

Evaluations of the Funds' performance, their total returns, and
comparisons may be used in advertisements and in information furnished to
current and prospective shareholders (collectively, "Advertisements"). The Funds
may also be compared to individual asset classes such as common stocks,
small-cap stocks, or Treasury bonds, based on information supplied by Ibbotson
and Sinquefield.

Other Performance Information
- -----------------------------

From time to time, information about a Portfolio's portfolio
allocation and holdings as of a particular date may be included in
Advertisements for the corresponding Fund. This information may include the
Portfolio's portfolio diversification by asset type, or in the case of Neuberger
Berman SOCIALLY RESPONSIVE Portfolio, by the social characteristics of companies
owned. Information used in Advertisements may include statements or
illustrations relating to the appropriateness of types of securities and/or
mutual funds that may be employed to meet specific financial goals, such as (1)
funding retirement, (2) paying for children's education, and (3) financially
supporting aging parents.

NB Management believes that many of its common stock funds may be
attractive investment vehicles for conservative investors who are interested in
long-term appreciation from stock investments, but who have a moderate tolerance
for risk. Such investors may include, for example, individuals (1) planning for

39
<PAGE>

or facing retirement, (2) receiving or expecting to receive lump-sum
distributions from individual retirement accounts ("IRAs"), self-employed
individual retirement plans ("Keogh plans", or other retirement plans, (3)
anticipating rollovers of CDs or IRAs, Keogh plans, or other retirement plans,
and (4) receiving a significant amount of money as a result of inheritance, sale
of a business, or termination of employment.

Investors who may find Neuberger Berman PARTNERS Assets, Neuberger
Berman GUARDIAN Assets or Neuberger Berman FOCUS Assets to be an attractive
investment vehicle also include parents saving to meet college costs for their
children. For instance, the cost of a college education is rapidly approaching
the cost of the average family home. Estimates of total four-year costs
(including tuition, room and board, books and other expenses) for students
starting college in various years may be included in Advertisements, based on
the College Board Annual Survey of Colleges.

Information relating to inflation and its effects on the dollar also
may be included in Advertisements. For example, after ten years, the purchasing
power of $25,000 would shrink to $16,621, $14,968, $13,465, and $12,100,
respectively, if the annual rates of inflation during that period were 4%, 5%,
6%, and 7%, respectively. (To calculate the purchasing power, the value at the
end of each year is reduced by the inflation rate for the ten-year period.)

Information regarding the effects of investing at market highs and/or
lows, and investing early versus late for retirement plans also may be included
in Advertisements, if appropriate.

CERTAIN RISK CONSIDERATIONS

Although each Portfolio seeks to reduce risk by investing in a
diversified portfolio of securities, diversification does not eliminate all
risk. There can, of course, be no assurance that any Portfolio will achieve its
investment objective.

TRUSTEES AND OFFICERS

The following table sets forth information concerning the trustees
and officers of the Trusts, including their addresses and principal business
experience during the past five years. Some persons named as trustees and
officers also serve in similar capacities for other funds and their
corresponding portfolios administered or managed by NB Management and Neuberger
Berman, LLC ("Neuberger Berman").

40
<PAGE>

Name, Age, and Positions Held
Address(1) With the Trusts Principal Occupation(s)(2)
- -------------- --------------- --------------------------

Claudia A. Brandon (42) Secretary of each Director, Corporate Secretarial,
Trust of Neuberger Berman; formerly
Vice President of NB Management;
Secretary of nine other mutual
funds for which NB Management
acts as investment manager or
administrator.

Faith Colish (64) Trustee of each Attorney at Law, Faith Colish,
63 Wall Street Trust A Professional Corporation.
24th Floor
New York, NY 10005

Stacy Cooper-Shugrue (36) Assistant Secretary Assistant Director, Corporate
of each Trust Secretarial, of Neuberger
Berman; formerly Assistant Vice
President of NB Management since
1993; Assistant Secretary of
nine other mutual funds for
which NB Management acts as
investment manager or
administrator.

Barbara DiGiorgio (40) Assistant Treasurer Assistant Treasurer since 1996
of each Trust of nine other mutual funds for
which NB Management acts as
investment manager or
administrator.

Michael M. Kassen (46)* President and Executive Vice President, Chief
Trustee of each Investment Officer and Director
Trust of Neuberger Berman;
President Trustee of six other
mutual funds for which NB
Management acts as investment
manager or administrator.

Howard A. Mileaf (62) Trustee of each Vice President and Special
WHX Corporation Trust Counsel to WHX Corporation
110 East 59th Street (holding company) since 1992;
30th Floor Director of Kevlin Corporation
New York, NY 10022 (manufacturer of microwave
and other products).

41
<PAGE>

Name, Age, and Positions Held
Address(1) With the Trusts Principal Occupation(s)(2)
- -------------- --------------- --------------------------

Edward I. O'Brien* (71) Trustee of each Until 1993, President of the
12 Woods Lane Trust Securities Industry Association
Scarsdale, NY 10583 ("SIA") (securities industry's
representative in government
relations and regulatory matters
at the federal and state
levels); until November 1993,
employee of the SIA; Director of
Legg Mason, Inc.

John T. Patterson, Jr. Trustee of each Retired. Formerly, President of
(71) Trust SOBRO (South Bronx Overall
7082 Siena Court Economic Development
Boca Raton, FL 33433 Corporation).

C. Carl Randolph (61) Assistant Secretary Senior Vice President, General
of each Trust Counsel and Secretary of
Neuberger Berman since 1992;
Assistant Secretary of nine
other mutual funds for which NB
Management acts as investment
manager or administrator.

John P. Rosenthal (66) Trustee of each Senior Vice President of
Burnham Securities Inc. Trust Burnham Securities Inc. (a
Burnham Asset Management registered broker-dealer) since
Corp. 1991; Director, Cancer Treatment
1325 Avenue of the Holdings, Inc.
Americas
17th Floor
New York, NY 10019

Cornelius T. Ryan (67) Trustee of each General Partner of Oxford
Oxford Bioscience Trust Partners and Oxford Bioscience
Partners Partners (venture capital
315 Post Road West partnerships) and President of
Westport, CT 06880 Oxford Venture Corporation;
Director of Capital Cash
Management Trust (money market
fund) and Prime Cash Fund.

42
<PAGE>

Name, Age, and Positions Held
Address(1) With the Trusts Principal Occupation(s)(2)
- -------------- --------------- --------------------------

Richard Russell (52) Treasurer and Vice President of NB Management
Principal since 1993; prior thereto,
Accounting Officer Assistant Vice President of NB
of each Trust Management; Treasurer and
Principal Accounting Officer of
nine other mutual funds for
which NB Management acts as
investment manager or
administrator.

Gustave H. Shubert (69) Trustee of each Senior Fellow/Corporate Advisor
13838 Sunset Boulevard Trust and Advisory Trustee of Rand
Pacific Palisades, CA (a non-profit public interest
90272 research institution) since
1989; Honorary Member of the
Board of Overseers of the
Institute for Civil Justice, the
Policy Advisory Committee of the
Clinical Scholars Program at the
University of California, the
American Association for the
Advancement of Science, the
Counsel on Foreign Relations,
and the Institute for Strategic
Studies (London); advisor to the
Program Evaluation and
Methodology Division of the U.S.
General Accounting Office;
formerly Senior Vice President
and Trustee of Rand.

Daniel J. Sullivan (70) Vice President of Senior Vice President of NB
each Trust Management since 1992; Vice
President of nine other mutual
funds for which NB Management
acts as investment manager
or administrator.

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<PAGE>

Name, Age, and Positions Held
Address(1) With the Trusts Principal Occupation(s)(2)
- -------------- --------------- --------------------------

Peter E. Sundman* (40) Chairman of the Executive Vice President and
Board, Chief Director of Neuberger Berman;
Executive Officer, President of NB Management;
and Trustee of each Chairman of the Board, Chief
Executive Officer and Trustee of
nine other mutual funds for
which NB Management acts as
investment manager or
administrator.

Michael J. Weiner (51) Vice President and Senior Vice President of NB
Principal Financial Management since 1992; Principal
Officer of each of Neuberger Berman since 1998;
Trust Treasurer of NB Management from
1992 to 1996; Vice President and
Principal Financial Officer of
nine other mutual funds for
which NB Management acts as
investment manager or
administrator.

Celeste Wischerth (38) Assistant Treasurer Employee of NB Management;
of each Trust Assistant Treasurer since 1996
of nine other mutual funds for
which NB Management acts as
investment manager or
administrator.

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

(1) Unless otherwise indicated, the business address of each listed person is
605 Third Avenue, New York, New York 10158.

(2) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.

* Indicates a trustee who is an "interested person" of each Trust within the
meaning of the 1940 Act. Mr. Sundman and Mr. Kassen are interested persons by
virtue of the fact that they are officers and/or directors of NB Management and
Managing Directors of Neuberger Berman. Mr. O'Brien is an interested person by
virtue of the fact that he is a director of Legg Mason, Inc., a wholly owned
subsidiary of which, from time to time, serves as a broker or dealer to the
Portfolios and other funds for which NB Management serves as investment manager.

44
<PAGE>

The Trust's Trust Instrument and Managers Trust's Declaration of
Trust provide that each such Trust will indemnify its trustees and officers
against liabilities and expenses reasonably incurred in connection with
litigation in which they may be involved because of their offices with the
Trust, unless it is adjudicated that they (a) engaged in bad faith, willful
misfeasance, gross negligence, or reckless disregard of the duties involved in
the conduct of their offices, or (b) did not act in good faith in the reasonable
belief that their action was in the best interest of the Trust. In the case of
settlement, such indemnification will not be provided unless it has been
determined (by a court or other body approving the settlement or other
disposition, by a majority of disinterested trustees based upon a review of
readily available facts, or in a written opinion of independent counsel) that
such officers or trustees have not engaged in willful misfeasance, bad faith,
gross negligence, or reckless disregard of their duties.

The following table sets forth information concerning the
compensation of the trustees of the Trust. None of the Neuberger Berman
Funds(REGISTERED) has any retirement plan for its trustees.

TABLE OF COMPENSATION
FOR FISCAL YEAR ENDED 8/31/99
-----------------------------

Aggregate Total Compensation from Investment
Name and Position with Compensation Companies in the Neuberger Berman
the Trust from the Trust Fund Complex Paid to Trustees
- ---------------------- -------------- ----------------------------------

Faith Colish $339 $96,500
Trustee (5 other investment
companies)

Stanley Egener $ 0 $ 0
Chairman of the Board, (9 other investment
Chief Executive Officer, companies)
and Trustee

Howard A. Mileaf $346 $64,250
Trustee (4 other investment
companies)

Edward I. O'Brien $359 $61,750
Trustee (3 other investment
companies)

John T. Patterson, Jr. $364 $66,500
Trustee (4 other investment
companies)

John P. Rosenthal $349 $64,250
Trustee (4 other investment
companies)

Cornelius T. Ryan $318 $52,750
Trustee (3 other investment
companies)

Gustave H. Shubert $344 $59,500
Trustee (3 other investment
companies)

45
<PAGE>

Lawrence Zicklin $ 0 $ 0
President and Trustee (5 other investment
companies)

At November 22, 1999, the trustees and officers of the Trusts, as a
group, owned beneficially or of record less than 1% of the outstanding shares of
each Fund.

INVESTMENT MANAGEMENT AND ADMINISTRATION SERVICES

Investment Manager and Administrator
- ------------------------------------

Because all of the Funds' net investable assets are invested in their
corresponding Portfolios, the Funds do not need an investment manager. NB
Management serves as the Portfolios' investment manager pursuant to a management
agreement with Managers Trust, dated as of August 2, 1993 ("EMT Management
Agreement").

The Management Agreement was approved for each Portfolio (except
Neuberger Berman MILLENNIUM and SOCIALLY RESPONSIVE Portfolios) by the Portfolio
Trustees, including a majority of the Portfolio Trustees who were not
"interested persons" of NB Management or Managers Trust ("Independent Portfolio
Trustees"), on July 15, 1993, and for Neuberger Berman MILLENIUM and SOCIALLY
RESPONSIVE Portfolios on July 29, 1998 and October 20, 1993, respectively. The
Management Agreement was approved by the holders of the interests in all the
Portfolios (except Neuberger Berman MILLENNIUM and SOCIALLY RESPONSIVE
Portfolios) on August 2, 1993, and by the holders of the interests in Neuberger
Berman MILLENNIUM and SOCIALLY RESPONSIVE Portfolios on October 19, 1998 and
March 9, 1994, respectively.

The Management Agreement provides, in substance, that NB Management
will make and implement investment decisions for the Portfolios in its
discretion and will continuously develop an investment program for the
Portfolios' assets. The Management Agreement permits NB Management to effect
securities transactions on behalf of each Portfolio through associated persons
of NB Management. The Management Agreement also specifically permits NB
Management to compensate, through higher commissions, brokers and dealers who
provide investment research and analysis to the Portfolios, although NB
Management has no current plans to pay a material amount of such compensation.

NB Management provides to each Portfolio, without separate cost,
office space, equipment, and facilities and the personnel necessary to perform
executive, administrative, and clerical functions. NB Management pays all

46
<PAGE>

salaries, expenses, and fees of the officers, trustees, and employees of
Managers Trust who are officers, directors, or employees of NB Management. One
director of NB Management (who is also an officer and/or director of Neuberger
Berman), serves as an officer of NB Management, and presently serves as a
trustee and officer of the Trusts. See "Trustees and Officers." Each Portfolio
pays NB Management a management fee based on the Portfolio's average daily net
assets, as described below.

NB Management provides facilities, services and personnel to each
Fund pursuant to an administration agreement with the Trust, dated November 1,
1994, as amended August 2, 1996 and January 1, 1999 ("Administration
Agreement"). For such administrative services, each Fund pays NB Management a
fee based on the Fund's average daily net assets, as described below.

NB Management enters into administrative services agreements with
Institutions, pursuant to which it compensates Institutions for accounting,
recordkeeping and other services that they provide in connection with
investments in the Funds.

Institutions may be subject to federal or state laws that limit their
ability to provide certain administrative or distribution related services. For
example, the Glass-Steagall Act is generally interpreted to prohibit most banks
from underwriting mutual fund shares. NB Management intends to contract with
Institutions for only those services they may legally provide. If, due to a
change in the laws governing Institutions or in the interpretation of any such
law, an Institution is prohibited from performing some or all of the
above-described services, NB Management may be required to find alternative
means of providing those services. Any such change is not expected to impact the
Funds or their shareholders adversely.

Management and Administration Fees
----------------------------------

NB Management provides investment management services to each Portfolio
that include, among other things, making and implementing investment decisions
and providing facilities and personnel necessary to operate the Portfolio. For
investment management services, each Portfolio (except Neuberger Berman GENESIS
and MILLENNIUM Portfolios) pays NB Management a fee at the annual rate of 0.55%
of the first $250 million of that Portfolio's average daily net assets, 0.525%
of the next $250 million, 0.50% of the next $250 million, 0.475% of the next
$250 million, 0.45% of the next $500 million, and 0.425% of average daily net
assets in excess of $1.5 billion. Neuberger Berman GENESIS and MILLENNIUM
Portfolio each pay NB Management a fee for investment management services at the
annual rate of 0.85% of the first $250 million of the Portfolio's average daily
net assets, 0.80% of the next $250 million, 0.75% of the next $250 million,
0.70% of the next $250 million, and 0.65% of average daily net assets in excess
of $1 billion.

NB Management provides administrative services to each Fund that include
furnishing facilities and personnel for the Fund and performing accounting,
recordkeeping, and other services. For such administrative services, each Fund
pays NB Management a fee at the annual rate of 0.40% of that Fund's average
daily net assets, plus certain out-of-pocket expenses for technology used for
shareholder servicing and shareholder communications subject to the prior
approval of an annual budget by the Trust' s Board of Trustees, including a
majority of those Trustees who are not interested persons of the Trust or of NB

47
<PAGE>

Management, and periodic reports to the Board of Trustees on actual expenses.
With a Fund's consent, NB Management may subcontract to Institutions some of its
responsibilities to that Fund under the administration agreement and may
compensate each Institution that provides such services (a portion of this
payment may be derived from the Rule 12b-1 fee paid to NB Management by the
Fund; see "Rule 12b-1 Plan' below).

During the fiscal years ended August 31, 1999, 1998 and 1997, each Fund
accrued management and administration fees as follows:

Management and Administration Fees
Accrued for Fiscal Years
Ended August 31

1999 1998 1997
---- ---- ----

MANHATTAN $4,849 $1,954 $1,108 *

GENESIS $643,622 $89,788 $1,123 **

FOCUS $13,659 $2,762 $1,083 *

GUARDIAN $201,255 $141,953 $20,291 *

PARTNERS $516,328 $170,854 $11,490 *

SOCIALLY RESPONSIVE $237*** N/A N/A

*/Period from September 4, 1996 (commencement of operations) to August 31, 1997.

**/Period from April 2, 1997 (commencement of operations) to August 31, 1997.

***/Period from June 9, 1999 (commencement of operations) to August 31, 1999.

Waivers and Reimbursements
- --------------------------

From May 1, 1995 to December 14, 1997, NB Management voluntarily
waived a portion of the management fee born by Neuberger Berman GENESIS
Portfolio to reduce the fee by 0.10% per annum of the average daily net assets
of that Portfolio.

Portion of Management Fee Waived

For Period Ended Fiscal Year Ended
December 14, 1997 August 31, 1997
----------------- ---------------
GENESIS Portfolio $165 $94

48
<PAGE>

Until December 31, 2009, NB Management has agreed to reimburse each
Fund (except Neuberger Berman MILLENNIUM and SOCIALLY RESPONSIVE Assets) for its
total operating expenses which exceed 1.50% per annum of the Fund's average net
assets (excluding interest, taxes, brokerage commissions and extraordinary
expenses).

NB Management has contractually undertaken to reimburse certain
expenses of Neuberger Berman SOCIALLY RESPONSIVE Assets through December 31,
2002 so that the total annual operating expenses of the Fund are limited to
1.50% of average net assets (excluding interest, taxes, brokerage commissions
and extraordinary expenses). The table below shows the amounts reimbursed by NB
Management pursuant to these arrangements:

Amount of Total Operating Expenses
Reimbursed by NB Management
for Fiscal Years Ended August 31

Fund 1999 1998 1997
- ---- ---- ---- ----

MANHATTAN $96,084 $85,971 $90,551 *

GENESIS $73,117 $72,484 $22,622 **

FOCUS $85,679 $82,521 $90,760 *

GUARDIAN $13,221 $21,582 $99,842 *

PARTNERS $0 $10,825 $96,351 *

SOCIALLY $127,061*** N/A N/A
RESPONSIVE

*/Period from September 4, 1996 (commencement of operations) to August 31,
1997.

**/Period from April 2, 1997 (commencement of operations) to August 31, 1997.

***/Period from June 9, 1999 (commencement of operations) to August 31, 1999.

NB Management has contractually agreed to reimburse certain expenses
of Neuberger Berman MILLENNIUM Assets through December 31, 2002 so that the
total annual operating expenses of the Fund are limited to 1.75% of average net
assets (excluding interest, taxes, brokerage commissions, and extraordinary
expenses).

49
<PAGE>

The Management Agreement continues until August 2, 2000. The
Management Agreement is renewable thereafter from year to year with respect to
each Portfolio, so long as its continuance is approved at least annually (1) by
the vote of a majority of the Portfolio Trustees who are not "interested
persons" of NB Management or Managers Trust ("Independent Portfolio Trustees"),
cast in person at a meeting called for the purpose of voting on such approval,
and (2) by the vote of a majority of the Portfolio Trustees or by a 1940 Act
majority vote of the outstanding interests in that Portfolio. The Administration
Agreement continues until August 2, 1999. The Administration Agreement is
renewable from year to year with respect to a Fund, so long as its continuance
is approved at least annually (1) by the vote of a majority of the Fund Trustees
who are not "interested persons" of NB Management or the Trust ("Independent
Fund Trustees"), cast in person at a meeting called for the purpose of voting on
such approval, and (2) by the vote of a majority of the Fund Trustees or by a
1940 Act majority vote of the outstanding shares in that Fund.

The Management Agreement is terminable, without penalty, with respect
to a Portfolio on 60 days' written notice either by Managers Trust or by NB
Management. The Administration Agreement is terminable, without penalty, with
respect to a Fund on 60 days' written notice either by NB Management or by the
Trust. Each Agreement terminates automatically if it is assigned.

Sub-Adviser
- -----------

NB Management retains Neuberger Berman, 605 Third Avenue, New York,
NY 10158-3698, as sub-adviser with respect to each Portfolio pursuant to a
sub-advisory agreement dated August 2, 1993 ("Sub-Advisory Agreement"). The
Sub-Advisory Agreement was approved by the holders of the interests in the
Portfolios (except Neuberger Berman MILLENNIUM and SOCIALLY RESPONSIVE and
Portfolios) on August 2, 1993. It was approved by the holders of the interests
in Neuberger Berman MILLENNIUM Portfolio on October 19, 1998, and by the holders
of the interests in Neuberger Berman SOCIALLY RESPONSIVE Portfolio on March 9,
1994.

The Sub-Advisory Agreement provides in substance that Neuberger
Berman will furnish to NB Management, upon reasonable request, the same type of
investment recommendations and research that Neuberger Berman, from time to
time, provides to its principals and employees for use in managing client
accounts. In this manner, NB Management expects to have available to it, in
addition to research from other professional sources, the capability of the
research staff of Neuberger Berman. This staff consists of numerous investment
analysts, each of whom specializes in studying one or more industries, under the
supervision of the Director of Research, who is also available for consultation
with NB Management. The Sub-Advisory Agreement provides that NB Management will
pay for the services rendered by Neuberger Berman based on the direct and
indirect costs to Neuberger Berman in connection with those services. Neuberger
Berman also serves as sub-adviser for all of the other mutual funds managed by
NB Management.

The Sub-Advisory Agreement continues until August 2, 2000 and is
renewable from year to year, subject to approval of its continuance in the same
manner as the Management Agreement. The Sub-Advisory Agreement is subject to
termination, without penalty, with respect to each Portfolio by the Portfolio

50
<PAGE>

Trustees or a 1940 Act majority vote of the outstanding interests in that
Portfolio, by NB Management, or by Neuberger Berman on not less than 30 nor more
than 60 days' prior written notice. The Sub-Advisory Agreement also terminates
automatically with respect to each Portfolio if it is assigned or if the
Management Agreement terminates with respect to that Portfolio.

Most money managers that come to the Neuberger Berman organization
have at least fifteen years experience. Neuberger Berman and NB Management
employ experienced professionals that work in a competitive environment.

Investment Companies Managed
- ----------------------------

As of September 30, 1999, the investment companies managed by NB
Management had aggregate net assets of approximately $17.8 billion. NB
Management currently serves as investment manager of the following investment
companies:

Approximate
Net Assets at
Name September 30, 1999
------------------

Neuberger Berman Cash Reserves Portfolio..........................$1,129,792,312
(investment portfolio for Neuberger Berman Cash Reserves)

Neuberger Berman Government Money Portfolio.........................$701,999,455
(investment portfolio for Neuberger Berman Government Money Fund)

Neuberger Berman High Yield Bond Portfolio...........................$25,041,449
(investment portfolio for Neuberger Berman High Yield Bond Fund)

Neuberger Berman Limited Maturity Bond Portfolio....................$274,532,907
(investment portfolio for Neuberger Berman Limited Maturity Bond Fund
and Neuberger Berman Limited Maturity Bond Trust)

Neuberger Berman Municipal Money Portfolio..........................$275,065,503
(investment portfolio for Neuberger Berman Municipal Money Fund)

Neuberger Berman Municipal Securities Portfolio......................$35,080,349
(investment portfolio for Neuberger Berman Municipal Securities Trust)

Neuberger Berman Focus Portfolio..................................$1,463,580,020
(investment portfolio for Neuberger Berman Focus Fund, Neuberger Berman
Focus Trust and Neuberger Berman Focus Assets)

Neuberger Berman Genesis Portfolio................................$1,647,532,448
(investment portfolio for Neuberger Berman Genesis Fund, Neuberger Berman
Genesis Trust, Neuberger Berman Genesis Assets and Neuberger Berman
Genesis Institutional)

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<PAGE>

Neuberger Berman Guardian Portfolio...............................$4,423,729,801
(investment portfolio for Neuberger Berman Guardian Fund, Neuberger Berman
Guardian Trust and Neuberger Berman Guardian Assets)

Neuberger Berman International Portfolio............................$117,925,499
(investment portfolio for Neuberger Berman International Fund and
Neuberger Berman International Trust)

Neuberger Berman Manhattan Portfolio................................$606,962,000
(investment portfolio for Neuberger Berman Manhattan Fund, Neuberger
Berman Manhattan Trust and Neuberger Berman Manhattan Assets)

Neuberger Berman Millennium Portfolio................................$78,666,423
(investment portfolio for Neuberger Berman Millennium Fund, Neuberger
Berman Millennium Trust and Neuberger Berman Millennium Assets)

Neuberger Berman Partners Portfolio...............................$3,553,329,259
(investment portfolio for Neuberger Berman Partners Fund, Neuberger Berman
Partners Trust and Neuberger Berman Partners Assets)

Neuberger Berman Regency Portfolio...................................$30,848,996
(investment portfolio for Neuberger Berman Regency Fund and Neuberger
Berman Regency Trust)

Neuberger Berman Socially Responsive Portfolio......................$376,629,789
(investment portfolio for Neuberger Berman Socially Responsive Fund,
Neuberger Berman Socially Responsive Trust, and Neuberger Berman Socially
Responsive Assets)

Advisers Managers Trust...........................................$2,026,088,252
(eight series)

The investment decisions concerning the Portfolios and the other
mutual funds managed by NB Management (collectively, "Other NB Funds") have been
and will continue to be made independently of one another. In terms of their
investment objectives, most of the Other NB Funds differ from the Portfolios.
Even where the investment objectives are similar, however, the methods used by
the Other NB Funds and the Portfolios to achieve their objectives may differ.
The investment results achieved by all of the mutual funds managed by NB
Management have varied from one another in the past and are likely to vary in
the future.

There may be occasions when a Portfolio and one or more of the Other
NB Funds or other accounts managed by Neuberger Berman are contemporaneously
engaged in purchasing or selling the same securities from or to third parties.
When this occurs, the transactions are averaged as to price and allocated, in
terms of amount, in accordance with a formula considered to be equitable to the
funds involved. Although in some cases this arrangement may have a detrimental
effect on the price or volume of the securities as to a Portfolio, in other
cases it is believed that a Portfolio's ability to participate in volume
transactions may produce better executions for it. In any case, it is the

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<PAGE>

judgment of the Portfolio Trustees that the desirability of the Portfolios'
having their advisory arrangements with NB Management outweighs any
disadvantages that may result from contemporaneous transactions.

The Portfolios are subject to certain limitations imposed on all
advisory clients of Neuberger Berman (including the Portfolios, the Other NB
Funds, and other managed accounts) and personnel of Neuberger Berman and its
affiliates. These include, for example, limits that may be imposed in certain
industries or by certain companies, and policies of Neuberger Berman that limit
the aggregate purchases, by all accounts under management, of the outstanding
shares of public companies.

Management and Control of NB Management
- ---------------------------------------

The directors and officers of NB Management, all of whom have
offices at the same address as NB Management, are Richard A. Cantor,
Chairman; Theodore P. Giuliano, Vice President; Michael M. Kassen, Executive
Vice President and Chief Investment Officer; Philip Ambrosio, Senior Vice
President and Chief Financial Officer; Barbara Katersky, Senior Vice
President; Daniel J. Sullivan, Senior Vice President; Peter E. Sundman,
President; Michael J. Weiner, Senior Vice President; Brooke A. Cobb, Vice
President; Robert W. D'Alelio, Vice President; Clara Del Villar, Vice
President; Robert S. Franklin, Vice President; Thomas Gengler, Vice
President; Robert I. Gendelman, Vice President; Josephine P. Mahaney, Vice
President; Michael F. Malouf, Vice President; Ellen Metzger, Secretary; S.
Basu Mullick, Vice President; Janet W. Prindle, Vice President; Kevin L.
Risen, Vice President; Benjamin E. Segal, Vice President; Jennifer K. Silver,
Vice President; Kent C. Simons, Vice President; Judith M. Vale, Vice
President; Catherine Waterworth, Vice President; Allan R. White III, Vice
President; Robert Conti, Treasurer; Ramesh Babu, Vice President; Valerie
Chang, Vice President; Robert L. Ladd, Vice President; Ingrid Saukaitis, Vice
President; Josephine Velez, Vice President. Messrs. Cantor, D'Alelio,
Gendelman, Giuliano, Kassen, Risen, Simons, Sundman, Weiner, and White and
Mmes. Prindle, Silver and Vale are employees of Neuberger Berman.

Messrs. Sundman and Kassen are trustees and officers, and Messrs.
Sullivan and Weiner are officers, of each Trust.

Neuberger Berman and NB Management are wholly owned subsidiaries of
Neuberger Berman, Inc. a publicly owned holding company owned primarily by the
employees of Neuberger Berman.

DISTRIBUTION ARRANGEMENTS

Distributor
- -----------

NB Management serves as the distributor ("Distributor") in connection
with the offering of each Fund's shares on a no-load basis to Institutions. In
connection with the sale of its shares, each Fund has authorized the Distributor
to give only the information, and to make only the statements and
representations, contained in the Prospectus and this SAI or that properly may
be included in sales literature and advertisements in accordance with the 1933
Act, the 1940 Act, and applicable rules of self-regulatory organizations. Sales

53
<PAGE>

may be made only by the Prospectus, which may be delivered personally, through
the mails, or by electronic means. The Distributor is the Funds' "principal
underwriter" within the meaning of the 1940 Act and, as such, acts as agent in
arranging for the sale of each Fund's shares to Institutions without sales
commission and bears advertising and promotion expenses incurred in the sale of
the Funds' shares.

The Trust, on behalf of each Fund, and the Distributor are parties to
a Distribution and Services Agreement dated February 12, 1996, as amended August
2, 1996 ("Distribution Agreement"). The Distribution Agreement was approved by
the Fund Trustees, including a majority of the Independent Fund Trustees and a
majority of those Independent Fund Trustees who have no direct or indirect
financial interest in the Distribution Agreement or the Trust's plan pursuant to
Rule 12b-1 under the 1940 Act ("Plan") ("Rule 12b-1 Trustees"), on October 25,
1995, and with respect to Neuberger Berman MILLENNIUM and SOCIALLY RESPONSIVE
Assets on July 29, 1998 and October 22, 1998, respectively. The Distribution
Agreement continues until August 2, 2000. The Distribution Agreement may be
renewed annually if specifically approved by (1) the vote of a majority of the
Fund Trustees or a 1940 Act majority vote of the Fund's outstanding shares and
(2) the vote of a majority of the Independent Fund Trustees and a majority of
the Rule 12b-1 Trustees, cast in person at a meeting called for the purpose of
voting on such approval. The Distribution Agreement may be terminated by either
party and will terminate automatically on its assignment, in the same manner as
the Management Agreement.

Rule 12b-1 Plan
- ---------------

The Fund Trustees adopted the Plan on October 25, 1995, as amended on
January 31, 1996 and August 2, 1996. Neuberger Berman GENESIS, MILLENNIUM and
SOCIALLY RESPONSIVE Assets were authorized to become subject to the Plan by vote
of the Fund Trustees on October 24, 1996 July 29, 1998 and October 22, 1998,
respectively. The Plan provides that each Fund will compensate NB Management for
administrative and other services provided to the Funds, its activities and
expenses related to the sale and distribution of Fund shares, and ongoing
services to investors in the Funds. Under the Plan, NB Management receives from
each Fund a fee at the annual rate of 0.25% of that Fund's average daily net
assets. NB Management may pay up to the full amount of this fee to Institutions
that make available Fund shares and/or provide services to the Funds and their
shareholders. The fee paid to an Institution is based on the level of such
services provided. Institutions may use the payments for, among other purposes,
compensating employees engaged in sales and/or shareholder servicing. The amount
of fees paid by a Fund during any year may be more or less than the cost of
distribution and other services provided to the Fund and its investors. NASD
rules limit the amount of annual distribution and service fees that may be paid
by a mutual fund and impose a ceiling on the cumulative distribution fees paid.
The Trust's plan complies with these rules.

The table below sets forth the amount of fees accrued for the funds
indicated below:

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<PAGE>

Period Ended August 31,

Fund 1999 1998 1997
- ---- ---- ---- ----

MANHATTAN $1,011 $213 $0

GENESIS $141,456 $20,147 $21

GUARDIAN $59,598 $42,298 $5,738

FOCUS $3,488 $471 $0

PARTNERS $151,403 $50,214 $3,176

SOCIALLY RESPONSIVE $47 N/A N/A

The Plan requires that NBMI provide the Fund Trustees for their
review a quarterly written report identifying the amounts expended by each Fund
and the purposes for which such expenditures were made must be provided to the
Fund Trustees for their review at least quarterly.

Prior to approving the Plan, the Fund Trustees considered various
factors relating to the implementation of the Plan and determined that there is
a reasonable likelihood that the Plan will benefit the Funds and their
shareholders. The Fund Trustees noted that the purpose of the master/feeder fund
structure is to permit access to a variety of markets. To the extent the Plan
allows the Funds to penetrate markets to which they would not otherwise have
access, the Plan may result in additional sales of Fund shares; this, in turn,
may enable the Funds to achieve economies of scale that could reduce expenses.
In addition, certain on-going shareholder services may be provided more
effectively by Institutions with which shareholders have an existing
relationship.

The Plan continues until August 2, 2000. The Plan is renewable
thereafter from year to year with respect to each Fund, so long as its
continuance is approved at least annually (1) by the vote of a majority of the
Fund Trustees and (2) by a vote of the majority of the Rule 12b-1 Trustees, cast
in person at a meeting called for the purpose of voting on such approval. The
Plan may not be amended to increase materially the amount of fees paid by any
Fund thereunder unless such amendment is approved by a 1940 Act majority vote of
the outstanding shares of the Fund and by the Fund Trustees in the manner
described above. The Plan is terminable with respect to a Fund at any time by a
vote of a majority of the Rule 12b-1 Trustees or by a 1940 Act majority vote of
the outstanding shares in the Fund.

ADDITIONAL PURCHASE INFORMATION

Share Prices and Net Asset Value
- --------------------------------

Each Fund's shares are bought or sold at a price that is the Fund's
NAV per share. The NAVs for each Fund and its corresponding Portfolio are
calculated by subtracting total liabilities from total assets (in the case of a
Portfolio, the market value of the securities the Portfolio holds plus cash and
other assets; in the case of a Fund, its percentage interest in its

55
<PAGE>

corresponding Portfolio, multiplied by the Portfolio's NAV, plus any other
assets). Each Fund's per share NAV is calculated by dividing its NAV by the
number of Fund shares outstanding and rounding the result to the nearest full
cent. Each Fund and its corresponding Portfolio calculate their NAVs as of the
close of regular trading on the NYSE, usually 4 p.m. Eastern time, on each day
the NYSE is open.

Each Portfolio values securities (including options) listed on the
NYSE, the American Stock Exchange or other national securities exchanges or
quoted on The Nasdaq Stock Market, and other securities for which market
quotations are readily available, at the last sale price on the day the
securities are being valued. If there is no reported sale of such a security on
that day, the security is valued at the mean between its closing bid and asked
prices on that day. These Portfolios value all other securities and assets,
including restricted securities, by a method that the trustees of Managers Trust
believe accurately reflects fair value.

If NB Management believes that the price of a security obtained under
a Portfolio's valuation procedures (as described above) does not represent the
amount that the Portfolio reasonably expects to receive on a current sale of the
security, the Portfolio will value the security based on a method that the
trustees of the Managers Trust believe accurately reflects fair value.

ADDITIONAL EXCHANGE INFORMATION

As more fully set forth in the section of the Prospectus entitled
"Maintaining Your Account," an Institution may exchange shares of any Fund for
shares of one or more of the other Funds, if made available through that
Institution. Any Fund may terminate or modify its exchange privilege in the
future.

Before effecting an exchange, Fund shareholders must obtain and
should review a currently effective Prospectus of the Fund into which the
exchange is to be made. An exchange is treated as a sale for federal income tax
purposes and, depending on the circumstances, a capital gain or loss may be
realized.

ADDITIONAL REDEMPTION INFORMATION

Suspension of Redemptions
- -------------------------

The right to redeem a Fund's shares may be suspended or payment of
the redemption price postponed (1) when the NYSE is closed, (2) when trading on
the NYSE is restricted, (3) when an emergency exists as a result of which it is
not reasonably practicable for its corresponding Portfolio to dispose of
securities it owns or fairly to determine the value of its net assets, or (4)
for such other period as the SEC may by order permit for the protection of the
Fund's shareholders. Applicable SEC rules and regulations shall govern whether
the conditions prescribed in (2) or (3) exist. If the right of redemption is

56
<PAGE>

suspended, shareholders may withdraw their offers of redemption, or they will
receive payment at the NAV per share in effect at the close of business on the
first day the NYSE is open ("Business Day") after termination of the suspension.

Redemptions in Kind
- -------------------

Each Fund reserves the right, under certain conditions, to honor any
request for redemption (or a combination of requests from the same shareholder
in any 90-day period) exceeding $250,000 or 1% of the net assets of the Fund,
whichever is less, by making payment in whole or in part in securities valued as
described under "Share Prices and Net Asset Value" above. If payment is made in
securities, an Institution generally will incur brokerage expenses or other
transaction costs in converting those securities into cash and will be subject
to fluctuation in the market prices of those securities until they are sold. The
Funds do not redeem in kind under normal circumstances, but would do so when the
Fund Trustees determined that it was in the best interests of a Fund's
shareholders as a whole.

DIVIDENDS AND OTHER DISTRIBUTIONS

Each Fund distributes to its shareholders substantially all of its
share of any net investment income (after deducting expenses incurred directly
by the Fund), any net realized capital gains, and any net realized gains from
foreign currency transactions earned or realized by its corresponding Portfolio.
A Portfolio's net investment income consists of all income accrued on portfolio
assets less accrued expenses, but does not include capital and foreign currency
gains and losses. Net investment income and realized gains and losses are
reflected in a Portfolio's NAV (and, hence, its corresponding Fund's NAV) until
they are distributed. Each Fund calculates its net investment income and NAV per
share as of the close of regular trading on the NYSE on each Business Day
(usually 4:00 p.m. Eastern time).

Dividends from net investment income and distributions of net
realized capital and foreign currency gains, if any, normally are paid once
annually, in December, except that Neuberger Berman GUARDIAN Assets distributes
substantially all of its share of Neuberger Berman GUARDIAN Portfolio's net
investment income (after deducting expenses incurred directly by Neuberger
Berman GUARDIAN Assets), if more than a de minimis amount, near the end of each
other calendar quarter.

Dividends and other distributions are automatically reinvested in
additional shares of the distributing Fund, unless the Institution elects to
receive them in cash ("cash election"). To the extent dividends and other
distributions are subject to federal, state, or local income taxation, they are
taxable to the shareholders whether received in cash or reinvested in Fund
shares. A cash election with respect to any Fund remains in effect until the
Institution notifies the Fund in writing to discontinue the election.

57
<PAGE>

ADDITIONAL TAX INFORMATION

Taxation of the Funds
- ---------------------

To continue to qualify for treatment as a RIC under the Code, each
Fund must distribute to its shareholders for each taxable year at least 90% of
its investment company taxable income (consisting generally of net investment
income, net short-term capital gain, and net gains from certain foreign currency
transactions) ("Distribution Requirement") and must meet several additional
requirements. With respect to each Fund, these requirements include the
following: (1) the Fund must derive at least 90% of its gross income each
taxable year from dividends, interest, payments with respect to securities
loans, and gains from the sale or other disposition of securities or foreign
currencies, or other income (including gains from Financial Instruments) derived
with respect to its business of investing in securities or those currencies
("Income Requirement"); and (2) at the close of each quarter of the Fund's
taxable year, (i) at least 50% of the value of its total assets must be
represented by cash and cash items, U.S. Government securities, securities of
other RICs, and other securities limited, in respect of any one issuer, to an
amount that does not exceed 5% of the value of the Fund's total assets and that
does not represent more than 10% of the issuer's outstanding voting securities,
and (ii) not more than 25% of the value of its total assets may be invested in
securities (other than U.S. Government securities or securities of other RICs)
of any one issuer. If a Fund failed to qualify for treatment as a RIC for any
taxable year, it would be taxed on the full amount of its taxable income for
that year without being able to deduct the distributions it makes to its
shareholders and the shareholders would treat all those distributions, including
distributions of net capital gain (the excess of net long-term capital gain over
net short-term capital loss), as dividends (that is, ordinary income) to the
extent of the Fund's earnings and profits.

Certain funds that invest in portfolios managed by NB Management,
including the Sister Funds, have received rulings from the Internal Revenue
Service ("Service") that each such fund, as an investor in its corresponding
portfolio, will be deemed to own a proportionate share of the portfolio's assets
and income for purposes of determining whether the fund satisfies all the
requirements described above to qualify as a RIC. Although these rulings may not
be relied on as precedent by the Funds, NB Management believes that the
reasoning thereof and, hence, their conclusion apply to the Funds as well.

Each Fund will be subject to a nondeductible 4% excise tax ("Excise
Tax") to the extent it fails to distribute by the end of any calendar year
substantially all of its ordinary income for that year and capital gain net
income for the one-year period ended on October 31 of that year, plus certain
other amounts.

See the next section for a discussion of the tax consequences to the
Funds of distributions to them from the Portfolios, investments by the
Portfolios in certain securities, and hedging transactions engaged in by the
Portfolios.

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<PAGE>

Taxation of the Portfolios
- --------------------------

The Portfolios (except Neuberger Berman MILLENNIUM and SOCIALLY
RESPONSIVE Portfolios) have received rulings from the Service to the effect
that, among other things, each Portfolio will be treated as a separate
partnership for federal income tax purposes and will not be a "publicly traded
partnership." Although these rulings may not be relied on as precedent by
Neuberger Berman MILLENNIUM and SOCIALLY RESPONSIVE Portfolios, NB Management
believes the reasoning thereof and, hence, their conclusion apply to that
Portfolio as well. As a result, no Portfolio is subject to federal income tax;
instead, each investor in a Portfolio, such as a Fund, is required to take into
account in determining its federal income tax liability its share of the
Portfolio's income, gains, losses, and deductions, without regard to whether it
has received any cash distributions from the Portfolio. Each Portfolio also is
not subject to Delaware or New York income or franchise tax.

Because each Fund is deemed to own a proportionate share of its
corresponding Portfolio's assets and income for purposes of determining whether
the Fund satisfies the requirements to qualify as a RIC, each Portfolio intends
to continue to conduct its operations so that its corresponding Fund will be
able to continue to satisfy all those requirements.

Distributions to a Fund from its corresponding Portfolio (whether
pursuant to a partial or complete withdrawal or otherwise) will not result in
the Fund's recognition of any gain or loss for federal income tax purposes,
except that (1) gain will be recognized to the extent any cash that is
distributed exceeds the Fund's basis for its interest in the Portfolio before
the distribution, (2) income or gain will be recognized if the distribution is
in liquidation of the Fund's entire interest in the Portfolio and includes a
disproportionate share of any unrealized receivables held by the Portfolio, (3)
loss will be recognized if a liquidation distribution consists solely of cash
and/or unrealized receivables, and (4) gain or loss may be recognized on a
distribution to a Fund that contributed property to a Portfolio (that is, all
Funds except Neuberger Berman MILLENNIUM and SOCIALLY RESPONSIVE Assets). A
Fund's basis for its interest in its corresponding Portfolio generally equals
the amount of cash the Fund invests in the Portfolio, increased by the Fund's
share of the Portfolio's net income and capital gains and decreased by (1) the
amount of cash and the basis of any property the Portfolio distributes to the
Fund and (2) the Fund's share of the Portfolio's losses.

Dividends and interest received by a Portfolio, and gains realized by
a Portfolio, may be subject to income, withholding, or other taxes imposed by
foreign countries and U.S. possessions ("foreign taxes") that would reduce the
total return on its securities. Tax treaties between certain countries and the
United States may reduce or eliminate foreign taxes, however, and many foreign
countries do not impose taxes on capital gains in respect of investments by
foreign investors.

A Portfolio may invest in the stock of "passive foreign investment
companies" ("PFICs"). A PFIC is any foreign corporation (with certain
exceptions) that, in general, meets either of the following tests: (1) at least
75% of its gross income is passive or (2) an average of at least 50% of its
assets produce, or are held for the production of, passive income. Under certain

59
<PAGE>

circumstances, if a Portfolio holds stock of a PFIC, its corresponding Fund
(indirectly through its interest in the Portfolio) will be subject to federal
income tax on its share of a portion of any "excess distribution" received by
the Portfolio on the stock or of any gain on the Portfolio's disposition of the
stock (collectively, "PFIC income"), plus interest thereon, even if the Fund
distributes its share of the PFIC income as a taxable dividend to its
shareholders. The balance of the Fund's share of the PFIC income will be
included in its investment company taxable income and, accordingly, will not be
taxable to it to the extent it distributes that income to its shareholders.

If a Portfolio invests in a PFIC and elects to treat the PFIC as a
"qualified electing fund" ("QEF"), then in lieu of its corresponding Fund's
incurring the foregoing tax and interest obligation, the Fund would be required
to include in income each year its share of the Portfolio's pro rata share of
the QEF's annual ordinary earnings and net capital gain - which the Fund most
likely would have to distribute to satisfy the Distribution Requirement and
avoid imposition of the Excise Tax - even if the Portfolio did not receive those
earnings and gain from the QEF. In most instances it will be very difficult, if
not impossible, to make this election because of certain requirements thereof.

A holder of stock in any PFIC may elect to include in ordinary income
for each taxable year the excess, if any, of the fair market value of the PFIC's
stock over the adjusted basis therein as of the end of that year. Pursuant to
the election, a deduction (as an ordinary, not capital, loss) also would be
allowed for the excess, if any, of the holder's adjusted basis in PFIC stock
over the fair market value thereof as of the taxable year-end, but only to the
extent of any net mark-to-market gains with respect to that stock included in
income for prior taxable years under the election (and under regulations
proposed in 1992 that provided a similar election with respect to the stock of
certain PFICs). The adjusted basis in each PFIC's stock subject to the election
would be adjusted to reflect the amounts of income included and deductions taken
thereunder.

The Portfolios' use of hedging strategies, such as writing (selling)
and purchasing options and entering into forward contracts, involves complex
rules that will determine for income tax purposes the amount, character, and
timing of recognition of the gains and losses the Portfolios realize in
connection therewith. Gains from the disposition of foreign currencies (except
certain gains that may be excluded by future regulations), and gains from
Financial Instruments derived by the Portfolio with respect to its business of
investing in securities or foreign currencies, will qualify as permissible
income for its corresponding Fund under the Income Requirement.

Exchange-traded futures contracts and certain forward contracts
subject to Section 1256 of the Code ("Section 1256 contracts") are required to
be marked to market (that is, treated as having been sold at market value)for
federal income tax purposes at the end of a Portfolio's taxable year. Sixty
percent of any net gain or loss recognized as a result of these "deemed sales,"
and 60% of any net realized gain or loss from any actual sales, of Section 1256
contracts are treated as long-term capital gain or loss; the remainder is
treated as short-term capital gain or loss. Section 1256 contracts also may be
marked-to-market for purposes of Excise Tax. These rules may operate to increase
the amount that a Fund must distribute to satisfy the Distribution Requirement,
which will be taxable to the shareholders as ordinary income, and to increase
the net capital gain recognized by the Fund, without in either case increasing

60
<PAGE>

the cash available to the Fund. A Portfolio may elect to exclude certain
transactions from the operation of section 1256, although doing so may have the
effect of increasing the relative proportion of net short-term capital gain
(taxable to its corresponding Fund's shareholders as ordinary income when
distributed to them) and/or increasing the amount of dividends that Fund must
distribute to meet the Distribution Requirement and avoid imposition of the
Excise Tax.

Each of Neuberger Berman PARTNERS, MILLENNIUM and SOCIALLY RESPONSIVE
Portfolios may acquire zero coupon securities or other securities issued with
original issue discount ("OID"). As a holder of those securities, the Portfolios
(and, through it, Neuberger Berman PARTNERS, MILLENNIUM and SOCIALLY RESPONSIVE
Assets) must take into income the OID that accrues on the securities during the
taxable year, even if it receives no corresponding payment on them during the
year. Because the Fund annually must distribute substantially all of its
investment company taxable income (including its share of the Portfolio's
accrued OID) to satisfy the Distribution Requirement and avoid imposition of the
Excise Tax, the Fund may be required in a particular year to distribute as a
dividend an amount that is greater than its share of the total amount of cash
the Portfolio actually receives. Those distributions will be made from such a
Fund's (or its share of the Portfolio's cash assets or, if necessary, from the
proceeds of sales of the Portfolio's securities. The Portfolio may realize
capital gains or losses from those sales, which would increase or decrease
Neuberger Berman PARTNERS, MILLENNIUM and SOCIALLY RESPONSIVE Assets' investment
company taxable income and/or net capital gain.

Taxation of the Funds' Shareholders
- -----------------------------------

If Fund shares are sold at a loss after being held for six months or
less, the loss will be treated as long-term, instead of short-term, capital loss
to the extent of any capital gain distributions received on those shares.

PORTFOLIO TRANSACTIONS

Neuberger Berman acts as principal broker for each Portfolio in the
purchase and sale of its portfolio securities (other than certain securities
traded on the OTC market). A substantial portion of the portfolio transactions
of Neuberger Berman GENESIS and MILLENNIUM Portfolios involves securities traded
on the OTC market; that Portfolio purchases and sells OTC securities in
principal transactions with dealers who are the principal market makers for such
securities.

During the fiscal year ended August 31, 1997, Neuberger Berman
MANHATTAN Portfolio paid brokerage commissions of $971,026, of which $458,679
was paid to Neuberger Berman. During the fiscal year ended August 31, 1998,
Neuberger Berman MANHATTAN Portfolio paid brokerage commissions of $1,132,309,
of which $546,227 was paid to Neuberger Berman.

During the fiscal year ended August 31, 1999, Neuberger Berman
MANHATTAN Portfolio paid brokerage commissions of $1,155,067, of which $495,351
was paid to Neuberger Berman. Transactions in which that Portfolio used
Neuberger Berman as broker comprised 45.46% of the aggregate dollar amount of
transactions involving the payment of commissions, and 42.89% of the aggregate

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<PAGE>

brokerage commissions paid by the Portfolio, during the fiscal year ended August
31, 1999. 99.63% of the $657,243 paid to other brokers by that Portfolio during
that fiscal year (representing commissions on transactions involving
approximately $398,886,704) was directed to those brokers because of research
services they provided. During the fiscal year ended August 31, 1999, that
Portfolio acquired securities of the following of its "regular brokers or
dealers" (as defined in the 1940 Act) ("Regular B/Ds"): American Express Credit
Corp., Donaldson, Lufkin, & Jenrette Securities Corp., Ford Motor Credit Co.,
General Electric Capital Corp., Goldman, Sachs & Co., Lehman Brothers Inc. and
State Street Bank & Trust Company, at that date, that Portfolio held the
securities of its Regular B/Ds with an aggregate value as follows: Ford Motor
Credit Co., $10,996,258; Lehman Brothers Inc., $5,138,500; and State Street Bank
& Trust Company $12,240,000.

During the fiscal year ended August 31, 1997, Neuberger Berman
GENESIS Portfolio paid brokerage commissions of $860,097, of which $516,040 was
paid to Neuberger Berman. During the fiscal year ended August 31, 1998,
Neuberger Berman GENESIS Portfolio paid brokerage commissions of $2,419,159, of
which $1,159,143 was paid to Neuberger Berman.

During the fiscal year ended August 31, 1999, Neuberger Berman
GENESIS Portfolio paid brokerage commissions of $2,150,168, of which $1,034,712
was paid to Neuberger Berman. Transactions in which that Portfolio used
Neuberger Berman as broker comprised 49.53% of the aggregate dollar amount of
transactions involving the payment of commissions, and 48.12% of the aggregate
brokerage commissions paid by the Portfolio, during the fiscal year ended August
31, 1999. 94.48% of the $1,053,905 paid to other brokers by that Portfolio
during that fiscal year (representing commissions on transactions involving
approximately $425,499,870) was directed to those brokers because of research
services they provided. During the fiscal year ended August 31, 1999, that
Portfolio acquired securities of the following of its Regular B/Ds: American
Express Credit Corp., Ford Motor Credit Co., General Electric Capital Corp.,
Merrill Lynch, Pierce, Fenner & Smith Inc., Morgan Stanley Dean Witter & Co.,
and State Street Bank and Trust Company, N.A.; at that date, that Portfolio held
the securities of its Regular B/Ds with an aggregate value as follows: American
Express Credit Corp., $9,997,150; General Electric Capital Corp., $9,989,831;
and State Street Bank & Trust Company,N.A., $26,740,000.

During the fiscal year ended August 31, 1997, Neuberger Berman Focus
Portfolio paid brokerage commissions of $1,825,493, of which $920,202 was paid
to Neuberger Berman. During the fiscal year ended August 31, 1998, Neuberger
Berman FOCUS Portfolio paid brokerage commissions of $2,051,007, of which
$998,930 was paid to Neuberger Berman.

During the fiscal year ended August 31, 1999, Neuberger Berman Focus
Portfolio paid brokerage commissions of $1,972,390, of which $983,860 was paid
to Neuberger Berman. Transactions in which that Portfolio used Neuberger Berman
as broker comprised 55.54% of the aggregate dollar amount of transactions
involving the payment of commissions, and 49.88% of the aggregate brokerage
commissions paid by the Portfolio, during the fiscal year ended August 31, 1999.
91.88% of the $908,219 paid to other brokers by that Portfolio during that
fiscal year (representing commissions on transactions involving approximately
$534,330,876) was directed to those brokers because of research services they
provided. During the fiscal year ended August 31, 1999, that Portfolio acquired
securities of the following of its Regular B/Ds: Ford Motor Credit Co., General

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<PAGE>

Electric Capital Corp., Merrill Lynch, Pierce, Fenner & Smith Inc., Morgan
Stanley Dean Witter & Co., and State Street Bank & Trust Company; at that date,
that Portfolio held the securities of its Regular B/Ds with an aggregate value
as follows: Morgan Stanley Dean Witter & Co., $87,957,813 and State Street Bank
& Trust Company,N.A., $22,890,000.

During the fiscal year ended August 31, 1997, Neuberger Berman
GUARDIAN Portfolio paid brokerage commissions of $8,540,335, of which $4,806,913
was paid to Neuberger Berman. During the fiscal year ended August 31, 1998,
Neuberger Berman GUARDIAN Portfolio paid brokerage commissions of $11,558,523,
of which $5,733,976 was paid to Neuberger Berman.

During the fiscal year ended August 31, 1999, Neuberger Berman
GUARDIAN Portfolio paid brokerage commissions of $10,793,418, of which
$3,975,341 was paid to Neuberger Berman. Transactions in which that Portfolio
used Neuberger Berman as broker comprised 42.88% of the aggregate dollar amount
of transactions involving the payment of commissions, and 36.83% of the
aggregate brokerage commissions paid by the Portfolio, during the fiscal year
ended August 31, 1999. 89.21% of the $6,082,366 paid to other brokers by that
Portfolio during that fiscal year (representing commissions on transactions
involving approximately $4,098,122,468) was directed to those brokers because of
research services they provided. During the fiscal year ended August 31, 1999,
that Portfolio acquired securities of the following of its Regular B/Ds:
American Express Credit Corp., Donaldson, Lufkin, & Jenrette Securities Corp.,
Ford Motor Credit Co., General Electric Capital Corp., Goldman, Sachs & Co.,
Merrill Lynch, Pierce, Fenner & Smith Inc., Morgan Stanley Dean Witter & Co.,
and State Street Bank & Trust Company; at that date, that Portfolio held the
securities of its Regular B/Ds with an aggregate value as follows: American
Express Credit Corp., $49,992,736; Ford Motor Credit Co., $49,948,667; General
Electric Capital Corp., $49,985,833; Morgan Stanley Dean Witter & Co.,
$49,728,344; and State Street Bank & Trust Company, $111,170,000.

During the fiscal year ended August 31, 1997, Neuberger Berman
PARTNERS Portfolio paid brokerage commissions of $5,413,453, of which $3,508,790
was paid to Neuberger Berman. During the fiscal year ended August 31, 1998,
Neuberger Berman PARTNERS Portfolio paid brokerage commissions of $10,028,713,
of which $6,281,978 was paid to Neuberger Berman.

During the fiscal year ended August 31, 1999, Neuberger Berman
PARTNERS Portfolio paid brokerage commissions of $14,228,430 of which $7,694,359
was paid to Neuberger Berman. Transactions in which that Portfolio used
Neuberger Berman as broker comprised 55.60% of the aggregate dollar amount of
transactions involving the payment of commissions, and 54.08% of the aggregate
brokerage commissions paid by the Portfolio, during the fiscal year ended August
31, 1999. 90.92% of the $5,940,877 paid to other brokers by that Portfolio
during that fiscal year (representing commissions on transactions involving
approximately $4,178,855,517) was directed to those brokers because of research
services they provided. During the fiscal year ended August 31, 1999, that
Portfolio acquired securities of the following of its Regular B/Ds: American
Express Credit Corp., Ford Motor Credit Co., General Electric Capital Corp.,
Goldman, Sachs & Co., Morgan Stanley Dean Witter & Co., and State Street Bank &
Trust Company; at that date, that Portfolio held the securities of its Regular
B/Ds with an aggregate value as follows: American Express Credit Corp.,
$49,948,375; Ford Motor Credit Co., $49,992,764; Morgan Stanley Dean Witter &
Co., $28,318,125; and State Street Bank & Trust Company, $63,300,000.

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During the fiscal year ended August 31, 1997, Neuberger Berman
SOCIALLY RESPONSIVE Portfolio paid brokerage commissions of $305,640, of which
$232,238 was paid to Neuberger Berman. During the fiscal year ended August 31,
1998, Neuberger Berman SOCIALLY RESPONSIVE Portfolio paid brokerage commissions
of $401,601, of which $296,353 was paid to Neuberger Berman.

During the fiscal year ended August 31, 1999, Neuberger Berman
SOCIALLY RESPONSIVE Portfolio paid brokerage commissions of $485,040, of which
$329,666 was paid to Neuberger Berman. Transactions in which that Portfolio used
Neuberger Berman as broker comprised 69.99% of the aggregate dollar amount of
transactions involving the payment of commissions, and 67.97% of the aggregate
brokerage commissions paid by the Portfolio, during the fiscal year ended August
31, 1999. 99.97% of the $155,324 paid to other brokers by that Portfolio during
that fiscal year (representing commissions on transactions involving
approximately $97,201,802) was directed to those brokers because of research
services they provided. During the fiscal year ended August 31, 1999, that
Portfolio acquired securities of the following of its Regular B/Ds: Goldman,
Sachs & Co. and State Street Bank & Trust Company; N.A.; at that date, that
Portfolio held the securities of its Regular B/Ds with an aggregate value as
follows: Goldman, Sachs & Co., $556,256; and State Street Bank & Trust Company,
$8,370,000.

During the fiscal year ended August 31, 1999, Neuberger Berman
MILLENNIUM Portfolio paid brokerage commissions of $50,656, of which $28,188 was
paid to Neuberger Berman. Transactions in which that Portfolio used Neuberger
Berman as broker comprised 52.82% of the aggregate dollar amount of transactions
involving the payment of commissions, and 55.65% of the aggregate brokerage
commissions paid by the Portfolio, during the fiscal year ended August 31, 1999.
99.14% of the $22,275 paid to other brokers by that Portfolio during that fiscal
year (representing commissions on transactions involving approximately
$9,372,700) was directed to those brokers because of research services they
provided. During the fiscal year ended August 31, 1999, that Portfolio acquired
securities of the following of its Regular B/Ds: Donaldson, Lufkin, & Jenrette
Securities Corp., Ford Motor Credit Co., General Electric Capital Corp., Merrill
Lynch, Pierce, Fenner & Smith Inc., and State Street Bank & Trust Company; at
that date, that Portfolio held the securities of its Regular B/Ds with an
aggregate value as follows: Ford Motor Credit Co., $1,499,783; and State Street
Bank & Trust Company, $2,090,000.

Insofar as portfolio transactions of Neuberger Berman PARTNERS
Portfolio result from active management of equity securities, and insofar as
portfolio transactions of Neuberger Berman MANHATTAN Portfolio result from
seeking capital appreciation by selling securities whenever sales are deemed
advisable without regard to the length of time the securities may have been
held, it may be expected that the aggregate brokerage commissions paid by those
Portfolios to brokers (including Neuberger Berman where it acts in that
capacity) may be greater than if securities were selected solely on a long-term
basis.

Portfolio securities may, from time to time, be loaned by a Portfolio
to Neuberger Berman in accordance with the terms and conditions of an order
issued by the SEC. The order exempts such transactions from provisions of the
1940 Act that would otherwise prohibit such transactions, subject to certain
conditions. In accordance with the order, securities loans made by a Portfolio
to Neuberger Berman are fully secured by cash collateral. The portion of the
income on the cash collateral which may be shared with Neuberger Berman is to be

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determined by reference to concurrent arrangements between Neuberger Berman and
non-affiliated lenders with which it engages in similar transactions. In
addition, where Neuberger Berman borrows securities from a Portfolio in order to
re-lend them to others, Neuberger Berman may be required to pay that Portfolio,
on a quarterly basis, certain of the earnings that Neuberger Berman otherwise
has derived from the re-lending of the borrowed securities. When Neuberger
Berman desires to borrow a security that a Portfolio has indicated a willingness
to lend, Neuberger Berman must borrow such security from that Portfolio, rather
than from an unaffiliated lender, unless the unaffiliated lender is willing to
lend such security on more favorable terms (as specified in the order) than that
Portfolio. If, in any month, a Portfolio's expenses exceed its income in any
securities loan transaction with Neuberger Berman, Neuberger Berman must
reimburse that Portfolio for such loss.

A committee of Independent Portfolio Trustees from time to time
reviews, among other things, information relating to securities loans by the
Portfolios. The following information reflects interest income earned by the
Portfolios from the cash collateralization of securities loans during the fiscal
years ended 1999, 1998, and 1997. As reflected below, Neuberger Berman received
a portion of the interest income from the cash collateral.

Interest Income from
Fiscal Collateralization Amount Paid to
Name of Portfolio Year End of Securities Loans Neuberger Berman
- ----------------- -------- -------------------- ----------------

- --------------------------------------------------------------------------------
Neuberger Berman
MANHATTAN Portfolio 8/31/98 $ 469,745 $ 212,611
8/31/97 $ 988,931 $ 326,403
- --------------------------------------------------------------------------------
Neuberger Berman
GENESIS Portfolio 8/31/98 $ 285,737 $ 152,375
8/31/97 $ 168,552 $ 69,948
- --------------------------------------------------------------------------------
Neuberger Berman
GUARDIAN Portfolio 8/31/98 $1,355,093 $1,035,708
8/31/97 $4,005,765 $3,523,486
- --------------------------------------------------------------------------------
Neuberger Berman
FOCUS Portfolio 8/31/98 $ 139,877 $ 101,879
8/31/97 $1,053,272 $ 898,127
- --------------------------------------------------------------------------------
Neuberger Berman
PARTNERS Portfolio 8/31/98 $ 280,193 $ 141,707
8/31/97 $ 797,133 $ 688,624
- --------------------------------------------------------------------------------
Neuberger Berman
SOCIALLY RESPONSIVE 8/31/98 $ 20,023 $ 10,803
Portfolio 8/31/97 $ 80,484 $ 51,639
- --------------------------------------------------------------------------------

In effecting securities transactions, each Portfolio generally seeks
to obtain the best price and execution of orders. Commission rates, being a
component of price, are considered along with other relevant factors. Each
Portfolio plans to continue to use Neuberger Berman as its principal broker

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where, in the judgment of NB Management, that firm is able to obtain a price and
execution at least as favorable as other qualified brokers. To the Portfolios'
knowledge, no affiliate of any Portfolio receives give-ups or reciprocal
business in connection with their securities transactions.

The use of Neuberger Berman as a broker for each Portfolio is subject
to the requirements of Section 11(a) of the Securities Exchange Act of 1934.
Section 11(a) prohibits members of national securities exchanges from retaining
compensation for executing exchange transactions for accounts which they or
their affiliates manage, except where they have the authorization of the persons
authorized to transact business for the account and comply with certain annual
reporting requirements. Managers Trust and NB Management have expressly
authorized Neuberger Berman to retain such compensation, and Neuberger Berman
has agreed to comply with the reporting requirements of Section 11(a).

Under the 1940 Act, commissions paid by a Portfolio to Neuberger
Berman in connection with a purchase or sale of securities on a securities
exchange may not exceed the usual and customary broker's commission.
Accordingly, it is each Portfolio's policy that the commissions paid to
Neuberger Berman must, in NB Management's judgment, be (1) at least as favorable
as those charged by other brokers having comparable execution capability and (2)
at least as favorable as commissions contemporaneously charged by Neuberger
Berman on comparable transactions for its most favored unaffiliated customers,
except for accounts for which Neuberger Berman acts as a clearing broker for
another brokerage firm and customers of Neuberger Berman considered by a
majority of the Independent Portfolio Trustees not to be comparable to the
Portfolio. The Portfolios do not deem it practicable and in their best interests
to solicit competitive bids for commissions on each transaction effected by
Neuberger Berman. However, consideration regularly is given to information
concerning the prevailing level of commissions charged by other brokers on
comparable transactions during comparable periods of time. The 1940 Act
generally prohibits Neuberger Berman from acting as principal in the purchase of
portfolio securities from, or the sale of portfolio securities to, a Portfolio
unless an appropriate exemption is available.

A committee of Independent Portfolio Trustees from time to time
reviews, among other things, information relating to the commissions charged by
Neuberger Berman to the Portfolios and to its other customers and information
concerning the prevailing level of commissions charged by other brokers having
comparable execution capability. In addition, the procedures pursuant to which
Neuberger Berman effects brokerage transactions for the Portfolios must be
reviewed and approved no less often than annually by a majority of the
Independent Portfolio Trustees.

To ensure that accounts of all investment clients, including a
Portfolio, are treated fairly in the event that Neuberger Berman receives
transaction instructions regarding a security for more than one investment
account at or about the same time, Neuberger Berman may combine orders placed on
behalf of clients, including advisory accounts in which affiliated persons have
an investment interest, for the purpose of negotiating brokerage commissions or
obtaining a more favorable price. Where appropriate, securities purchased or
sold may be allocated, in terms of amount, to a client according to the
proportion that the size of the order placed by that account bears to the

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aggregate size of orders contemporaneously placed by the other accounts, subject
to de minimis exceptions. All participating accounts will pay or receive the
same price.

Under policies adopted by the Board of Trustees, Neuberger Berman may
enter into agency cross-trades on behalf of a Portfolio. An agency cross-trade
is a securities transaction in which the same broker acts as agent on both sides
of the trade and the broker or an affiliate has discretion over one of the
participating accounts. In this situation, Neuberger Berman would receive
brokerage commissions from both participants in the trade. The other account
participating in an agency cross-trade with a Portfolio cannot be an account
over which Neuberger Berman exercises investment discretion. A member of the
Board of Trustees who is not affiliated with Neuberger Berman reviews
confirmations of each agency cross-trade that the Portfolios participate in.

Each Portfolio expects that it will continue to execute a portion of
its transactions through brokers other than Neuberger Berman. In selecting those
brokers, NB Management considers the quality and reliability of brokerage
services, including execution capability, performance, and financial
responsibility, and may consider research and other investment information
provided by, and sale of Fund shares effected through, those brokers.

A committee comprised of officers of NB Management and employees of
Neuberger Berman who are portfolio managers of some of the Portfolios and Other
NB Funds (collectively, "NB Funds") and some of Neuberger Berman's managed
accounts ("Managed Accounts") evaluates semi-annually the nature and quality of
the brokerage and research services provided by other brokers. Based on this
evaluation, the committee establishes a list and projected rankings of preferred
brokers for use in determining the relative amounts of commissions to be
allocated to those brokers. Ordinarily, the brokers on the list effect a large
portion of the brokerage transactions for the NB Funds and the Managed Accounts
that are not effected by Neuberger Berman. However, in any semi-annual period,
brokers not on the list may be used, and the relative amounts of brokerage
commissions paid to the brokers on the list may vary substantially from the
projected rankings. These variations reflect the following factors, among
others: (1) brokers not on the list or ranking below other brokers on the list
may be selected for particular transactions because they provide better price
and/or execution, which is the primary consideration in allocating brokerage;
(2) adjustments may be required because of periodic changes in the execution
capabilities of or research provided by particular brokers or in the execution
or research needs of the NB Funds and/or the Managed Accounts; and (3) the
aggregate amount of brokerage commissions generated by transactions for the NB
Funds and the Managed Accounts may change substantially from one semi-annual
period to the next.

The commissions paid to a broker other than Neuberger Berman may be
higher than the amount another firm might charge if NB Management determines in
good faith that the amount of those commissions is reasonable in relation to the
value of the brokerage and research services provided by the broker. NB
Management believes that those research services benefit the Portfolios by
supplementing the information otherwise available to NB Management. That
research may be used by NB Management in servicing Other NB Funds and, in some
cases, by Neuberger Berman in servicing the Managed Accounts. On the other hand,
research received by NB Management from brokers effecting portfolio transactions

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<PAGE>

on behalf of the Other NB Funds and by Neuberger Berman from brokers effecting
portfolio transactions on behalf of the Managed Accounts may be used for the
Portfolios' benefit.

Kent C. Simons; Kevin L. Risen and Allan R. White III; Judith M. Vale
and Robert W. D'Alelio; Jennifer K. Silver and Brooke A. Cobb; Michael F. Malouf
and Jennifer K. Silver; Robert I. Gendelman and S. Basu Mullick, and Janet W.
Prindle, each of whom is a Vice President of NB Management and a principal of
Neuberger Berman, are the persons primarily responsible for making decisions as
to specific action to be taken with respect to the investment portfolios of
Neuberger Berman FOCUS, Neuberger Berman GUARDIAN, Neuberger Berman GENESIS,
Neuberger Berman MANHATTAN, Neuberger Berman MILLENNIUM, Neuberger Berman
PARTNERS and Neuberger Berman SOCIALLY Responsive Portfolios, respectively. Each
of them has full authority to take action with respect to portfolio transactions
and may or may not consult with other personnel of NB Management prior to taking
such action.

Portfolio Turnover
- ------------------

A Portfolio's portfolio turnover rate is calculated by dividing (1)
the lesser of the cost of the securities purchased or proceeds from the
securities sold by the Portfolio during the fiscal year (other than securities,
including options, whose maturity or expiration date at the time of acquisition
was one year or less) by (2) the month-end average of the value of such
securities owned by the Portfolio during the fiscal year.

REPORTS TO SHAREHOLDERS

Shareholders of each Fund receive unaudited semi-annual financial
statements, as well as year-end financial statements audited by the independent
auditors or independent accountants for the Fund and its corresponding
Portfolio. Each Fund's statements show the investments owned by its
corresponding Portfolio and the market values thereof and provide other
information about the Fund and its operations, including the Fund's beneficial
interest in its corresponding Portfolio.

ORGANIZATION, CAPITALIZATION AND OTHER MATTERS

The Funds
- ---------

Each Fund is a separate ongoing series of the Trust, a Delaware
business trust organized pursuant to a Trust Instrument dated as of October 18,
1993. The Trust is registered under the Investment Company Act of 1940 as a
diversified, open-end management investment company, commonly known as a mutual
fund. The Trust has six separate series. Each Fund invests all of net investable
assets in its corresponding Portfolio, in each case receiving a beneficial
interest in that Portfolio. The trustees of the Trust may establish additional
series or classes of shares without the approval of shareholders. The assets of

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<PAGE>

each series belong only to that series, and the liabilities of each series are
borne solely by that series and no other.

Prior to November 9, 1998, the name of the Trust was "Neuberger &
Berman Equity Assets" and the term "Neuberger Berman" in each Fund's name was
"Neuberger & Berman."

Prior to January 1, 1995, the name of Neuberger and Berman FOCUS
Portfolio was Neuberger Berman Selected Sectors Portfolio.

DESCRIPTION OF SHARES. Each Fund is authorized to issue an unlimited
number of shares of beneficial interest (par value $0.001 per share). Shares of
each Fund represent equal proportionate interests in the assets of that Fund
only and have identical voting, dividend, redemption, liquidation, and other
rights. All shares issued are fully paid and non-assessable, and shareholders
have no preemptive or other rights to subscribe to any additional shares.

SHAREHOLDER MEETINGS. The trustees of the Trust do not intend to hold
annual meetings of shareholders of the Funds. The trustees will call special
meetings of shareholders of a Fund only if required under the 1940 Act or in
their discretion or upon the written request of holders of 10% or more of the
outstanding shares of that Fund entitled to vote.

CERTAIN PROVISIONS OF TRUST INSTRUMENT. Under Delaware law, the
shareholders of a Fund will not be personally liable for the obligations of any
Fund; a shareholder is entitled to the same limitation of personal liability
extended to shareholders of a corporation. To guard against the risk that
Delaware law might not be applied in other states, the Trust Instrument requires
that every written obligation of the Trust or a Fund contain a statement that
such obligation may be enforced only against the assets of the Trust or Fund and
provides for indemnification out of Trust or Fund property of any shareholder
nevertheless held personally liable for Trust or Fund obligations, respectively.

OTHER. Because Fund shares can be bought, owned and sold only through
an account with an Institution, a client of an Institution may be unable to
purchase additional shares and/or may be required to redeem shares (and possibly
incur a tax liability) if the client no longer has a relationship with the
Institution if the Institution no longer has a contract with NB Management to
perform services. Depending on the policies of the Institution involved, an
investor may be able to transfer an account from one Institution to another.

The Portfolios
- --------------

Each Portfolio (is a separate operating series of Managers Trust, a
New York common law trust organized as of December 1, 1992. Managers Trust has
seven separate Portfolios. The assets of each Portfolio belong only to that
Portfolio, and the liabilities of each Portfolio are borne solely by that
Portfolio and no other.

FUNDS' INVESTMENTS IN PORTFOLIOS. Each Fund is a "feeder fund" that
seeks to achieve its investment objective by investing all of its net investable
assets in its corresponding Portfolio, which is a "master fund." The Portfolio,

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<PAGE>

which has the same investment objective, policies, and limitations as the Fund,
in turn invests in securities; the Fund thus acquires an indirect interest in
those securities.

Each Fund's investment in its corresponding Portfolio is in the form
of a non-transferable beneficial interest. Members of the general public may not
purchase a direct interest in a Portfolio. The Sister Funds that are series of
Equity Funds and other mutual funds that are series of Neuberger Berman Equity
Trust ("Equity Trust") and Neuberger Berman Equity Series ("Equity Series")
invest all of their respective net investable assets in corresponding Portfolios
of Managers Trust. The shares of each series of Equity Funds (but not of Equity
Trust or Equity Series) are available for purchase by members of the general
public. The Trust does not sell its shares directly to members of the general
public.

Each Portfolio may also permit other investment companies and/or
other institutional investors to invest in the Portfolio. All investors will
invest in a Portfolio on the same terms and conditions as a Fund and will pay a
proportionate share of the Portfolio's expenses. Other investors in a Portfolio
(including the series of Equity Funds, Equity Trust and Equity Series) are not
required to sell their shares at the same public offering price as a Fund, could
have a different administration fee and expenses than a Fund, and (except Equity
Funds, Equity Trust and Equity Series) might charge a sales commission.
Therefore, Fund shareholders may have different returns than shareholders in
another investment company that invests exclusively in the Portfolio.
Information regarding any Fund that invests in a Portfolio is available from NB
Management by calling 800-366-6264.

The trustees of the Trust believe that investment in a Portfolio by a
series of Equity Funds, Equity Trust or Equity Series or by other potential
investors in addition to a Fund may enable the Portfolio to realize economies of
scale that could reduce its operating expenses, thereby producing higher returns
and benefiting all shareholders. However, a Fund's investment in its
corresponding Portfolio may be affected by the actions of other large investors
in the Portfolio, if any. For example, if a large investor in a Portfolio (other
than a Fund) redeemed its interest in the Portfolio, the Portfolio's remaining
investors (including the Fund) might, as a result, experience higher pro rata
operating expenses, thereby producing lower returns.

Each Fund may withdraw its entire investment from its corresponding
Portfolio at any time, if the trustees of the Trust determine that it is in the
best interests of the Fund and its shareholders to do so. A Fund might withdraw,
for example, if there were other investors in a Portfolio with power to, and who
did by a vote of all investors (including the Fund), change the investment
objective, policies, or limitations of the Portfolio in a manner not acceptable
to the trustees of the Trust. A withdrawal could result in a distribution in
kind of portfolio securities (as opposed to a cash distribution) by the
Portfolio to the Fund. That distribution could result in a less diversified
portfolio of investments for the Fund and could affect adversely the liquidity
of the Fund's investment portfolio. If the Fund decided to convert those
securities to cash, it usually would incur brokerage fees or other transaction
costs. If a Fund withdrew its investment from a Portfolio, the trustees of the
Trust would consider what actions might be taken, including the investment of
all of the Fund's net investable assets in another pooled investment entity
having substantially the same investment objective as the Fund or the retention
by the Fund of its own investment manager to manage its assets in accordance

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with its investment objective, policies, and limitations. The inability of the
Fund to find a suitable replacement could have a significant impact on
shareholders.

INVESTOR MEETINGS AND VOTING. Each Portfolio normally will not hold
meetings of investors except as required by the 1940 Act. Each investor in a
Portfolio will be entitled to vote in proportion to its relative beneficial
interest in the Portfolio. On most issues subjected to a vote of investors, a
Fund will solicit proxies from its shareholders and will vote its interest in
the Portfolio in proportion to the votes cast by the Fund's shareholders. If
there are other investors in a Portfolio, there can be no assurance that any
issue that receives a majority of the votes cast by Fund shareholders will
receive a majority of votes cast by all Portfolio investors; indeed, if other
investors hold a majority interest in a Portfolio, they could have voting
control of the Portfolio.

CERTAIN PROVISIONS. Each investor in a Portfolio, including a
Fund, will be liable for all obligations of the Portfolio. However, the risk of
an investor in a Portfolio incurring financial loss beyond the amount of its
investment on account of such liability would be limited to circumstances in
which the Portfolio had inadequate insurance and was unable to meet its
obligations out of its assets. Upon liquidation of a Portfolio, investors would
be entitled to share pro rata in the net assets of the Portfolio available for
distribution to investors.

CUSTODIAN AND TRANSFER AGENT

Each Fund and Portfolio has selected State Street Bank & Trust
Company ("State Street"), 225 Franklin Street, Boston, MA 02110, as custodian
for its securities and cash. State Street also serves as each Fund's transfer
agent, administering purchases, redemptions, and transfers of Fund shares with
respect to Institutions and the payment of dividends and other distributions to
Institutions. All correspondence should be mailed to Neuberger Berman Funds,
Institutional Services, 605 Third Avenue, 2nd Floor, New York, NY 10158-0180. In
addition, State Street serves as transfer agent for each Portfolio.

INDEPENDENT AUDITORS/ACCOUNTANTS

Each Fund and Portfolio (other than Neuberger Berman MANHATTAN,
MILLENNIUM and SOCIALLY RESPONSIVE Assets and Portfolios) has selected Ernst &
Young LLP, 200 Clarendon Street, Boston, MA 02116, as the independent auditors
who will audit its financial statements. Neuberger Berman MANHATTAN, MILLENNIUM
and SOCIALLY RESPONSIVE Assets and Portfolios have selected
PricewaterhouseCoopers LLP, 160 Federal Street, Boston, MA 02109, as the
independent accountants who will audit their financial statements.

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<PAGE>

LEGAL COUNSEL

Each Fund and Portfolio has selected Kirkpatrick & Lockhart LLP, 1800
Massachusetts Avenue, N.W., 2nd Floor, Washington, D.C. 20036-1800, as its legal
counsel.

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

The following table sets forth the name, address, and percentage of
ownership of each person who was known by each Fund to own beneficially or of
record 5% or more of that Fund's outstanding shares at October 30, 1999.

Percentage of
Ownership at
Name and Address October 30, 1999
---------------- ----------------

Neuberger Berman Neuberger Berman 8.02%
MANHATTAN Assets Management Inc.
605 Third Avenue
2nd Floor
New York, NY 10158-0180

BHC Securities, Inc. 56.92%
FAO 58900009
Mutual Funds
One Commerce Square
20005 Market Street
Suite 1200
Philadelphia, PA 19103-7084

BHC Securities, Inc. 29.32%
FAO 58900014
Mutual Funds
One Commerce Square
20005 Market Street
Suite 1200
Philadelphia, PA 19103-7084

Neuberger Berman Key Trust Co. 22.31%
GENESIS Assets FBO Prism
4900 Tiedeman Rd.
Brooklyn, OH 44144-2338

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Percentage of
Ownership at
Name and Address October 30, 1999
---------------- ----------------

Donaldson, Lufkin & Jenrette 51.42%
Securities Corporation
Pershing Corporation
Mutual Fund Balancing
P.O. Box 2052
Jersey City, NJ 07303-2052

Neuberger Berman Smith Barney Corp. Trust Co., 44.64%
FOCUS Assets Trustee
Smith Barney 401K
Advisor Group Trust
Two Tower Center
P.O. Box 1063
E. Brunswick, NJ 08816-1063

Key Trust 48.70%
FBO Prism
4900 Tiedeman Rd.
Brooklyn, OH 44144-2338

Neuberger Berman Travelers Insurance Co. 97.23%
GUARDIAN Assets 5MS - One Tower Square
Hartford, CT 06183-0002

Neuberger Berman Travelers Insurance Co. 47.43%
PARTNERS Assets 5MS - One Tower Square
Hartford, CT 06183-0001

Key Trust Co. 25.97%
FBO Prism
4900 Tiedeman Rd.
Brooklyn, OH 44144-2238

Brown Brothers & Harriman 17.18%
40 Water Street
Boston, MA 02109-3661

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Percentage of
Ownership at
Name and Address October 30, 1999
---------------- ----------------

Neuberger Berman Neuberger & Berman Management 86.88%
SOCIALLY RESPONSIVE Inc.
Assets Attn: Emad Hanna
605 Third Avenue, 37th Floor
New York, NY 10158-0180

Fidelity Investments 12.08%
Institutional Operations Co.
Inc.
(FIIOC) as Agent for PEET's
Tea Coffee Inc.
Savings Retirement Plan #09771
100 Magellan Way
Covington, KY 41015-1999

REGISTRATION STATEMENT

This SAI and the Prospectus do not contain all the information
included in the Trust's registration statement filed with the SEC under the 1933
Act with respect to the securities offered by the Prospectus. The registration
statement, including the exhibits filed therewith, may be examined at the SEC's
offices in Washington, D.C.

Statements contained in this SAI and in the Prospectus as to the
contents of any contract or other document referred to are not necessarily
complete. In each instance where reference is made to the copy of any contract
or other document filed as an exhibit to the registration statement, each such
statement is qualified in all respects by such reference.

FINANCIAL STATEMENTS

The following financial statements and related documents are
incorporated herein by reference from the Annual Report to Shareholders of
Neuberger Berman Equity Assets for the fiscal year ended August 31, 1999:

The audited financial statements of the Funds and Portfolios and
notes thereto for the fiscal year ended August 31, 1998, and the
reports of Ernst & Young LLP, independent auditors, with respect
to such audited financial statements of Neuberger Berman FOCUS
Assets and Portfolio, Neuberger Berman GENESIS Assets and
Portfolio and Neuberger Berman GUARDIAN Assets and Portfolio,
and Neuberger Berman PARTNERS Assets and Portfolio, and the
report of PricewaterhouseCoopers LLP, independent accountants,
with respect to such audited financial statements of Neuberger
Berman MANHATTAN Assets and Portfolio, Neuberger Berman

74
<PAGE>

MILLENNIUM Assets and Portfolio, Neuberger Berman SOCIALLY
RESPONSIVE Assets and Portfolio.

75
<PAGE>

Appendix A

RATINGS OF CORPORATE BONDS AND COMMERCIAL PAPER

S&P CORPORATE BOND RATINGS:
--------------------------

AAA - Bonds rated AAA have the highest rating assigned by S&P.
Capacity to pay interest and repay principal is extremely strong.

AA - Bonds rated AA have a very strong capacity to pay interest and
repay principal and differ from the higher rated issues only in small degree.

A - Bonds rated A have a strong capacity to pay interest and repay
principal, although they are somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than bonds in higher rated
categories.

BBB - Bonds rated BBB are regarded as having an adequate capacity to
pay principal and interest. Whereas they normally exhibit adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay principal and interest for bonds in
this category than for bonds in higher rated categories.

BB, B, CCC, CC, C - Bonds rated BB, B, CCC, CC, and C are regarded,
on balance, as predominantly speculative with respect to capacity to pay
interest and repay principal in accordance with the terms of the obligation. BB
indicates the lowest degree of speculation and C the highest degree of
speculation. While such bonds will likely have some quality and protective
characteristics, these are outweighed by large uncertainties or major risk
exposures to adverse conditions.

CI - The rating CI is reserved for income bonds on which no interest
is being paid.

D - Bonds rated D are in default, and payment of interest and/or
repayment of principal is in arrears.

PLUS (+) or MINUS (-) - The ratings above may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.

MOODY'S CORPORATE BOND RATINGS:

Aaa - Bonds rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to as
"gilt edge." Interest payments are protected by a large or an exceptionally
stable margin, and principal is secure. Although the various protective elements
are likely to change, the changes that can be visualized are most unlikely to
impair the fundamentally strong position of the issuer.

A-1
<PAGE>

Aa - Bonds rated Aa are judged to be of high quality by all
standards. Together with the Aaa group, they comprise what are generally known
as "high-grade bonds." They are rated lower than the best bonds because margins
of protection may not be as large as in Aaa-rated securities, fluctuation of
protective elements may be of greater amplitude, or there may be other elements
present that make the long-term risks appear somewhat larger than in Aaa-rated
securities.

A - Bonds rated A possess many favorable investment attributes and
are to be considered as upper-medium grade obligations. Factors giving security
to principal and interest are considered adequate, but elements may be present
that suggest a susceptibility to impairment sometime in the future.

Baa - Bonds which are rated Baa are considered as medium-grade
obligations, i.e., they are neither highly protected nor poorly secured.
Interest payments and principal security appear adequate for the present, but
certain protective elements may be lacking or may be characteristically
unreliable over any great length of time. These bonds lack outstanding
investment characteristics and in fact have speculative characteristics as well.

Ba - Bonds rated Ba are judged to have speculative elements; their
future cannot be considered as well assured. Often the protection of interest
and principal payments may be very moderate and thereby not well safeguarded
during both good and bad times over the future. Uncertainty of position
characterizes bonds in this class.

B - Bonds rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.

Caa - Bonds rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal or
interest.

Ca - Bonds rated Ca represent obligations that are speculative in a
high degree. Such issues are often in default or have other marked shortcomings.

C - Bonds rated C are the lowest rated class of bonds, and issues so
rated can be regarded as having extremely poor prospects of ever attaining any
real investment standing.

MODIFIERS--Moody's may apply numerical modifiers 1, 2, and 3 in each generic
rating classification described above. The modifier 1 indicates that the
security ranks in the higher end of its generic rating category; the modifier 2
indicates a mid-range ranking; and the modifier 3 indicates that the issuer
ranks in the lower end of its generic rating.

A-2
<PAGE>

S&P COMMERCIAL PAPER RATINGS:

A-1 - This highest category indicates that the degree of safety
regarding timely payment is strong. Those issues determined to possess extremely
strong safety characteristics are denoted with a plus sign (+).

MOODY'S COMMERCIAL PAPER RATINGS

Issuers rated PRIME-1 (or related supporting institutions), also
known as P-1, have a superior capacity for repayment of short-term promissory
obligations. PRIME-1 repayment capacity will normally be evidenced by the
following characteristics:

- Leading market positions in well-established industries.
- High rates of return on funds employed.
- Conservative capitalization structures with moderate reliance
on debt and ample asset protection.
- Broad margins in earnings coverage of fixed financial charges
and high internal cash generation.
- Well-established access to a range of financial markets and
assured sources of alternate liquidity.

A-3
<PAGE>

NEUBERGER BERMAN EQUITY ASSETS
POST-EFFECTIVE AMENDMENT NO. 17 ON FORM N-1A

PART C

OTHER INFORMATION

ITEM 23. EXHIBITS
- -------- --------

EXHIBIT DESCRIPTION
NUMBER -----------
------

(a) (1) Certificate of Trust. Incorporated by Reference
to Post-Effective Amendment No. 1 to
Registrant's Registration Statement, File Nos.
33-82568 and 811-8106.

(2) Restated Certificate of Trust. Incorporated by
Reference to Post-Effective Amendment No. 13 to
Registrant's Registration Statement, File Nos.
33-82568 and 811-8106.

(3) Trust Instrument of Neuberger Berman Equity
Assets. Incorporated by Reference to
Post-Effective Amendment No. 1 to Registrant's
Registration Statement, File Nos. 33-82568 and
811-8106.

(4) Schedule A - Current Series of Neuberger Berman
Equity Assets. Incorporated by Reference to
Post-Effective Amendment No. 16 to Registrant's
Registration Statement, File Nos. 33-82568 and
811-8106.

(b) By-Laws of Neuberger Berman Equity Assets.
Incorporated by Reference to Post-Effective
Amendment No. 1 to Registrant's Registration
Statement, File Nos. 33-82568 and 811-8106.

(c) (1) Trust Instrument of Neuberger Berman Equity
Assets, Articles IV, V, and VI. Incorporated by
Reference to Post-Effective Amendment No. 1 to
Registrant's Registration Statement, File Nos.
33-82568 and 811-8106.

(2) By-Laws of Neuberger Berman Equity Assets,
Articles V, VI, and VIII. Incorporated by
Reference to Post-Effective Amendment No. 1 to
Registrant's Registration Statement, File Nos.
33-82568 and 811-8106.

(d) (1) (i) Management Agreement Between Equity
Managers Trust and Neuberger Berman
Management Inc. Incorporated by
Reference to Post-Effective Amendment
No. 70 to Registration Statement of
Neuberger Berman Equity Funds, File Nos.
2-11357 and 811-582.

(ii) Schedule A - Series of Neuberger Berman
Equity Managers Trust Currently Subject
to the Management Agreement.
Incorporated by Reference to
Post-Effective Amendment No. 11 to
Registrant's Registration Statement,
File Nos. 33-82568 and 811-8106.

<PAGE>

EXHIBIT DESCRIPTION
NUMBER -----------
------

(iii) Schedule B - Schedule of Compensation
Under the Management Agreement.
Incorporated by Reference to
Post-Effective Amendment No. 11 to
Registrant's Registration Statement,
File Nos. 33-82568 and 811-8106.

(2) (i) Sub-Advisory Agreement Between Neuberger
Berman Management Inc. and Neuberger
Berman with Respect to Equity Managers
Trust. Incorporated by Reference to
Post-Effective Amendment No. 70 to
Registration Statement of Neuberger
Berman Equity Funds, File Nos. 2-11357
and 811-582.

(ii) Schedule A - Series of Equity Managers
Trust Currently Subject to the
Sub-Advisory Agreement. Incorporated by
Reference to Post-Effective Amendment
No. 11 to Registrant's Registration
Statement, File Nos. 33-82568 and
811-8106.

(iii) Substitution Agreement Among Neuberger
Berman Management Inc., Equity Managers
Trust, Neuberger Berman, L.P., and
Neuberger Berman, LLC. Incorporated by
Reference to Amendment No. 7 to
Registration Statement of Equity
Managers Trust, File No. 811-7910.

(e) (1) (i) Distribution and Services Agreement
Between Neuberger Berman Equity Assets
and Neuberger Berman Management Inc.
Incorporated by Reference to
Post-Effective Amendment No. 9 to
Registrant's Registration Statement,
File Nos. 33-82568 and 811-08106.

(ii) Schedule A - Series of Neuberger Berman
Equity Assets Currently Subject to
Distribution and Services Agreement.
Incorporated by Reference to
Post-Effective Amendment No. 16 to
Registrant's Registration Statement,
File Nos. 33-82568 and 811-8106.

(f) Bonus, Profit Sharing or Pension Plans. None.

(g) (1) Custodian Contract Between Neuberger Berman
Equity Assets and State Street Bank and Trust
Company. Incorporated by Reference to
Post-Effective Amendment No. 3 to
Registrant's Registration Statement, File
Nos. 33-82568 and 811-8106.

(2) Schedule of Compensation under the Custodian
Contract. Incorporated by Reference to
Post-Effective Amendment No. 4 to
Registrant's Registration Statement, File
Nos. 33-82568 and 811-8106.

(h) (1) (i) Transfer Agency Agreement Between
Neuberger Berman Equity Assets and State
Street Bank and Trust Company.
Incorporated by Reference to
Post-Effective Amendment No. 3 to
Registrant's Registration Statement,
File Nos. 33-82568 and 811-8106.

2
<PAGE>

EXHIBIT DESCRIPTION
NUMBER -----------
------

(ii) First Amendment to the Transfer Agency
Agreement Between Neuberger Berman
Equity Assets and State Street Bank and
Trust Company. Incorporated by Reference
to Post-Effective Amendment No. 9 to
Registrant's Registration Statement,
File Nos. 33-82568 and 811-8106.

(iii) Schedule of Compensation under the
Transfer Agency Agreement. Incorporated
by Reference to Post-Effective Amendment
No. 4 to Registrant's Registration
Statement, File Nos. 33-82568 and
811-8106.

(2) (i) Administration Agreement Between
Neuberger Berman Equity Assets and
Neuberger Berman Management Inc.
Incorporated by Reference to
Post-Effective Amendment No. 9 to
Registrant's Registration Statement,
File Nos. 33-82568 and 811-8106.

(ii) Schedule A - Series of Neuberger Berman
Equity Assets Currently Subject to the
Administration Agreement. Incorporated
by Reference to Post-Effective Amendment
No. 16 to Registrant's Registration
Statement, File Nos. 33-82568 and
811-8106.

(iii) Schedule B - Schedule of Compensation
Under the Administration Agreement.
Incorporated by Reference to
Post-Effective Amendment No. 16 to
Registrant's Registration Statement,
File Nos. 33-82568 and 811-8106.

(i) (a) Opinion and Consent of Kirkpatrick &
Lockhart LLP on Securities Matters with
Respect to Neuberger Berman Focus
Assets, Neuberger Berman Guardian
Assets, Neuberger Berman Manhattan
Assets, and Neuberger Berman Partners
Assets. Incorporated by Reference to
Post- Effective Amendment No. 3 to
Registrant's Registration Statement,
File Nos. 33-82568 and 811-8106.

(b) Opinion and Consent of Kirkpatrick &
Lockhart LLP on Securities Matters with
Respect to Neuberger Berman Genesis
Assets. Incorporated by Reference to
Post-Effective Amendment No. 9 to
Registrant's Registration Statement,
File Nos. 33-82568 and 811-8106.

(c) Opinion and Consent of Kirkpatrick &
Lockhart LLP on Securities Matters with
Respect to Neuberger Berman Socially
Responsive Assets. Incorporated by
Reference to Post-Effective Amendment
No. 1 to the Registration Statement of
Neuberger Berman Equity Series, File
Nos. 333-66137 and 811-09011.

(d) Consent to use Previously Filed Opinions
of Kirkpatrick & Lockhart LLP on
Securities Matters. Filed herewith.

(j) Consent of Independent Auditors. Filed
herewith.

(k) Financial Statements Omitted from Prospectus.
None.

3
<PAGE>

EXHIBIT DESCRIPTION
NUMBER -----------
------

(l) Letter of Investment Intent. None.

(m) (a) Plan Pursuant to Rule 12b-1. Incorporated by
Reference to Post-Effective Amendment No. 9
to Registrant's Registration Statement, File
Nos. 33-82568 and 811-8106.

(b) Schedule A - Series of Neuberger Berman
Equity Assets Currently Subject to Plan
Pursuant to Rule 12b-1. Incorporated by
Reference to Post-Effective Amendment No. 16
to Registrant's Registration Statement, File
Nos. 33-82568 and 811-8106.

(n) Financial Data Schedule. Not Applicable.

(o) Plan Pursuant to Rule 18f-3. None.

ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT.
- -------- --------------------------------------------------------------

No person is controlled by or under common control with the
Registrant.

ITEM 25. INDEMNIFICATION.
- -------- ----------------

A Delaware business trust may provide in its governing
instrument for indemnification of its officers and trustees from and against any
and all claims and demands whatsoever. Article IX, Section 2 of the Trust
Instrument provides that the Registrant shall indemnify any present or former
trustee, officer, employee or agent of the Registrant ("Covered Person") to the
fullest extent permitted by law against liability and all expenses reasonably
incurred or paid by him or her in connection with any claim, action, suit or
proceeding ("Action") in which he or she becomes involved as a party or
otherwise by virtue of his or her being or having been a Covered Person and
against amounts paid or incurred by him or her in settlement thereof.
Indemnification will not be provided to a person adjudged by a court or other
body to be liable to the Registrant or its shareholders by reason of "willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his or her office" ("Disabling Conduct"), or not to
have acted in good faith in the reasonable belief that his or her action was in
the best interest of the Registrant. In the event of a settlement, no
indemnification may be provided unless there has been a determination that the
officer or trustee did not engage in Disabling Conduct (i) by the court or other
body approving the settlement; (ii) by at least a majority of those trustees who
are neither interested persons, as that term is defined in the Investment
Company Act of 1940 ("1940 Act"), of the Registrant ("Independent Trustees"),
nor are parties to the matter based upon a review of readily available facts; or
(iii) by written opinion of independent legal counsel based upon a review of
readily available facts.

Pursuant to Article IX, Section 3 of the Trust Instrument, if
any present or former shareholder of any series ("Series") of the Registrant
shall be held personally liable solely by reason of his or her being or having
been a shareholder and not because of his or her acts or omissions or for some
other reason, the present or former shareholder (or his or her heirs, executors,
administrators or other legal representatives or in the case of any entity, its
general successor) shall be entitled out of the assets belonging to the
applicable Series to be held harmless from and indemnified against all loss and
expense arising from such liability. The Registrant, on behalf of the affected
Series, shall, upon request by such shareholder, assume the defense of any claim
made against such shareholder for any act or obligation of the Series and
satisfy any judgment thereon from the assets of the Series.

Section 9 of the Management Agreement between Equity Managers
Trust ("Managers Trust") and Neuberger Berman Management Inc. ("NB Management")
provides that neither NB Management nor any director, officer or employee of NB
Management performing services for the series of Managers Trust at the direction

4
<PAGE>

or request of NB Management in connection with NB Management's discharge of its
obligations under the Agreement shall be liable for any error of judgment or
mistake of law or for any loss suffered by a series in connection with any
matter to which the Agreement relates; provided, that nothing in the Agreement
shall be construed (i) to protect NB Management against any liability to
Managers Trust or any series thereof or its interest holders to which NB
Management would otherwise be subject by reason of willful misfeasance, bad
faith, or gross negligence in the performance of NB Management's duties, or by
reason of NB Management's reckless disregard of its obligations and duties under
the Agreement, or (ii) to protect any director, officer or employee of NB
Management who is or was a trustee or officer of Managers Trust against any
liability to Managers Trust or any series thereof or its interest holders to
which such person would otherwise be subject by reason of willful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in the
conduct of such person's office with Managers Trust.

Section 1 of the Sub-Advisory Agreement between NB Management
and Neuberger Berman, LLC ("Neuberger Berman") with respect to Managers Trust
provides that in the absence of willful misfeasance, bad faith or gross
negligence in the performance of its duties, or of reckless disregard of its
duties and obligations under the Agreement, Neuberger Berman will not be subject
to liability for any act or omission or any loss suffered by any series of
Managers Trust or its interest holders in connection with the matters to which
the Agreement relates.

Section 8 of the Administration Agreement between the
Registrant and NB Management provides that NB Management shall look only to the
assets of each Series for performance of the Agreement by the Registrant on
behalf of such Series, and neither the Shareholders of the Registrant, its
Trustees nor any of the Registrant's officers, employees or agents, whether
past, present or future shall be personally liable therefor. Section 9 of the
Agreement provides that each Series shall indemnify NB Management and hold it
harmless from and against any and all losses, damages and expenses, including
reasonable attorneys' fees and expenses, incurred by NB Management that result
from: (i) any claim, action, suit or proceeding in connection with NB
Management's entry into or performance of the Agreement with respect to such
Series; or (ii) any action taken or omission to act committed by NB Management
in the performance of its obligations under the Agreement with respect to such
Series; or (iii) any action of NB Management upon instructions believed in good
faith by it to have been executed by a duly authorized officer or representative
of the Registrant with respect to such Series; provided, that NB Management
shall not be entitled to such indemnification in respect of actions or omissions
constituting negligence or misconduct on the part of NB Management, or its
employees, agents or contractors. Section 10 of the Agreement provides that NB
Management shall indemnify each Series and hold it harmless from and against any
and all losses, damages and expenses, including reasonable attorneys' fees and
expenses, incurred by such Series which result from: (i) NB Management's failure
to comply with the terms of the Agreement with respect to such Series; or (ii)
NB Management's lack of good faith in performing its obligations under the
Agreement with respect to such Series; or (iii) the negligence or misconduct of
NB Management, or its employees, agents or contractors in connection with the
Agreement with respect to such Series. A Series shall not be entitled to such
indemnification in respect of actions or omissions constituting negligence or
misconduct on the part of that Series or its employees, agents or contractors
other than NB Management, unless such negligence or misconduct results from or
is accompanied by negligence or misconduct on the part of NB Management, any
affiliated person of NB Management, or any affiliated person of an affiliated
person of NB Management.

Section 11 of the Distribution Agreement between the
Registrant and NB Management provides that NB Management shall look only to the
assets of a Series for the Registrant's performance of the Agreement by the
Registrant on behalf of such Series, and neither the Shareholders, the Trustees
nor any of the Registrant's officers, employees or agents, whether past, present
or future, shall be personally liable therefor.

Insofar as indemnification for liabilities arising under the
Securities Act of 1933 ("1933 Act") may be permitted to trustees, officers and
controlling persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission, such indemnification is against public policy as
expressed in the 1933 Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a trustee, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such trustee, officer or controlling person, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction

5
<PAGE>

the question whether such indemnification by it is against public policy as
expressed in the 1933 Act and will be governed by the final adjudication of such
issue.

ITEM 26. BUSINESS AND OTHER CONNECTIONS OF ADVISER AND SUB-ADVISER.
- -------- ----------------------------------------------------------

There is set forth below information as to any other business,
profession, vocation or employment of a substantial nature in which each
director or officer of NB Management and each principal of Neuberger Berman is,
or at any time during the past two years has been, engaged for his or her own
account or in the capacity of director, officer, employee, partner or trustee.

6
<PAGE>

NAME BUSINESS AND OTHER CONNECTIONS
- ---- ------------------------------

Philip Ambrosio Senior Vice President and Chief Financial
Senior Vice President and Chief Officer, Neuberger Berman Inc.
Financial Officer, Neuberger Berman

Brooke A. Cobb Chief Investment Officer, Bainco
Vice President, International Investors. Senior Vice
NB Management President and Senior Portfolio Manager,
Putnam Investments.(1)

Barbara DiGiorgio, Assistant Treasurer, Neuberger Berman
Assistant Vice President, Advisers Management Trust; Assistant
NB Management Treasurer, Advisers Managers Trust;
Assistant Treasurer, NeubergerBerman
Income Funds; Assistant Treasurer,
Neuberger Berman Income Trust; Assistant
Treasurer, Neuberger Berman Equity Funds;
Assistant Treasurer, Neuberger Berman
Equity Trust; Assistant Treasurer, Income
Managers Trust; Assistant Treasurer,
Equity Managers Trust; Assistant
Treasurer, Global Managers Trust;
Assistant Treasurer, Neuberger Berman
Equity Assets; Assistant Treasurer,
Neuberger Berman Equity Series. Theodore
P. Giuliano President and Trustee,
Neuberger Berman Income Vice President and
Funds; President and Trustee, Neuberger
Berman Director, NB Management; Income
Trust; President and Trustee, Income
Managing Director, Neuberger Berman
Managers Trust.

Michael M. Kassen Executive Vice President, Chief Investment
Executive Vice President, Officer and Director, Neuberger Berman
Neuberger Berman Inc.

Jeffrey B. Lane President, Chief Executive Officer and
President and Chief Executive Director of Neuberger Berman, Inc.
Officer, Neuberger Berman

Michael F. Malouf Portfolio Manager, Dresdner RCM Global
Vice President Investors.(2)
NB Management

Robert Matza Executive Vice President, Chief
Executive Vice President and Chief Administrative Officer and Director,
Administrative Officer, Neuberger Neuberger Berman, Inc.
Berman

- ---------------
(1) Until 1997.
(2) Until 1998.

7
<PAGE>

NAME BUSINESS AND OTHER CONNECTIONS
- ---- ------------------------------

S. Basu Mullick Portfolio Manager, Ark Asset
Vice President, Management.(3)
NB Management

C. Carl Randolph Secretary and General Counsel, Neuberger
Senior Vice President, General Berman, Inc. Assistant Secretary,
Counsel and Secretary, Neuberger Berman Advisers Management
Neuberger Berman Trust; Assistant Secretary, Advisers
Managers Trust; Assistant Secretary,
Neuberger Berman Income Funds; Assistant
Secretary, Neuberger Berman Income Trust;
Assistant Secretary, Neuberger Berman
Equity Funds; Assistant Secretary,
Neuberger Berman Equity Trust; Assistant
Secretary, Income Managers Trust;
Assistant Secretary, Equity Managers
Trust; Assistant Secretary, Global
Managers Trust; Assistant Secretary,
Neuberger Berman Equity Assets; Assistant
Secretary, Neuberger Berman Equity Series.

Richard Russell Treasurer, Neuberger Berman Advisers
Vice President, Management Trust; Treasurer, Advisers
NB Management Managers Trust; Treasurer, Neuberger
Berman Income Funds; Treasurer, Neuberger
Berman Income Trust; Treasurer, Neuberger
Berman Equity Funds; Treasurer, Neuberger
Berman Equity Trust; Treasurer, Income
Managers Trust; Treasurer, Equity Managers
Trust; Treasurer, Global Managers Trust;
Treasurer, Neuberger Berman Equity Assets;
Treasurer, Neuberger Berman Equity Series.

Ingrid Saukaitis Project Director, Council on Economic
Vice President, NB Management Priorities.(4)

Heidi L. Schneider Executive Vice President and Director,
Executive Vice President, Neuberger Neuberger Berman, Inc.
Berman

Benjamin E. Segal Assistant Portfolio Manager, GT Global
Vice President, NB Management, Investment Management*/; Consultant, Bain
Managing Director, Neuberger Berman & Company, Inc.**/

- ---------------
(3) Until 1998.
(4) Until 1997.
*/ Until 1997.
**/ Until 1997.

8
<PAGE>

NAME BUSINESS AND OTHER CONNECTIONS
- ---- ------------------------------

Jennifer K. Silver Portfolio Manager and Director, Putnum
Vice President, NB Management, Investments.(5)
Managing Director, Neuberger Berman

Daniel J. Sullivan Vice President, Neuberger Berman Advisers
Senior Vice President, Management Trust; Vice President, Advisers
NB Management Managers Trust; Vice President, Neuberger
Berman Income Funds; Vice President,
Neuberger Berman Income Trust; Vice
President, Neuberger Berman Equity Funds;
Vice President, Neuberger Berman Equity
Trust; Vice President, Income Managers
Trust; Vice President, Equity Managers
Trust; Vice President, Global Managers
Trust; Vice President, Neuberger Berman
Equity Assets; Vice President, Neuberger
Berman Equity Series. Peter E. Sundman
Executive Vice President and Director,
Neuberger President, NB Management;
Executive Berman Inc. Vice President,
Neuberger Berman

Michael J. Weiner Vice President, Neuberger Berman Advisers
Senior Vice President, Management Trust; Vice President, Advisers
NB Management; Senior Vice Managers Trust; Vice President, Neuberger
President, Neuberger Berman Berman Income Funds; Vice President,
Neuberger Berman Income Trust; Vice
President, Neuberger Berman Equity Funds;
Vice President, Neuberger Berman Equity
Trust; Vice President, Income Managers
Trust; Vice President, Equity Managers
Trust; Vice President, Global Managers
Trust; Vice President, Neuberger Berman
Equity Assets; Vice President, Neuberger
Berman Equity Series.

- ---------------
(5) Until 1997.

9
<PAGE>

NAME BUSINESS AND OTHER CONNECTIONS
- ---- ------------------------------

Allan R. White, III Portfolio Manager, Salomon Asset
Vice President, NB Management.(6)
Management; Managing Director,
Neuberger Berman

Celeste Wischerth, Assistant Treasurer, Neuberger Berman
NB Management Advisers Management Trust; Assistant
Treasurer, Advisers Managers Trust;
Assistant Treasurer, Neuberger Berman
Income Funds; Assistant Treasurer,
Neuberger Berman Income Trust; Assistant
Treasurer, Neuberger Berman Equity Funds;
Assistant Treasurer, Neuberger Berman
Equity Trust; Assistant Treasurer, Income
Managers Trust; Assistant Treasurer,
Equity Managers Trust; Assistant
Treasurer, Global Managers Trust;
Assistant Treasurer, Neuberger Berman
Equity Assets; Assistant Treasurer,
Neuberger Berman Equity Series.

The principal address of NB Management, Neuberger Berman, and of each
of the investment companies named above, is 605 Third Avenue, New York, New York
10158.
The principal address of NB Management, Neuberger Berman, and of each
of the investment companies named above, is 605 Third Avenue, New York, New York
10158.

ITEM 27. PRINCIPAL UNDERWRITERS.
- -------- -----------------------

(a) NB Management, the principal underwriter distributing securities of
the Registrant, is also the principal underwriter and distributor for each of
the following investment companies:

Neuberger Berman Advisers Management Trust
Neuberger Berman Equity Funds
Neuberger Berman Equity Series
Neuberger Berman Equity Trust
Neuberger Berman Income Funds
Neuberger Berman Income Trust

NB Management is also the investment manager to the master
funds in which the above-named investment companies invest.

(b) Set forth below is information concerning the directors and
officers of the Registrant's principal underwriter. The principal business
address of each of the persons listed is 605 Third Avenue, New York, New York
10158-0180, which is also the address of the Registrant's principal underwriter.

- ---------------
(6) Until 1998.

10
<PAGE>

POSITIONS AND OFFICES POSITIONS AND OFFICES
NAME WITH UNDERWRITER WITH REGISTRANT
---- --------------------- ---------------------
Ramesh Babu Vice President None
Richard A. Cantor Chairman of the Board None
Valerie Chang Vice President None
Brooke A. Cobb Vice President None
Robert Conti Treasurer None
Robert W. D'Alelio Vice President None
Clara Del Villar Vice President None
Barbara DiGiorgio Assistant Vice President Assistant Treasurer
Robert S. Franklin Vice President None
Robert I. Gendelman Vice President None
Theodore P. Giuliano Vice President and Director None
Michael M. Kassen Vice President and Director None
Robert L. Ladd Vice President None
Josephine Mahaney Vice President None
Michael F. Malouf Vice President None
Ellen Metzger Secretary None
S. Basu Mullick Vice President None
Janet W. Prindle Vice President None
Kevin L. Risen Vice President None
Ingrid Saukaitis Vice President None
Benjamin Segal Vice President None
Jennifer K. Silver Vice President None
Kent C. Simons Vice President None
Daniel J. Sullivan Senior Vice President Vice President
Peter E. Sundman President None
Judith M. Vale Vice President None
Josephine Velez Vice President None
Catherine Waterworth Vice President None
Michael J. Weiner Senior Vice President Vice President and
Principal Financial
Officer
Allan R. White, III Vice President None

(c) No commissions or other compensation were received directly or
indirectly from the Registrant by any principal underwriter who was not an
affiliated person of the Registrant.

11
<PAGE>

ITEM 28. LOCATION OF ACCOUNTS AND RECORDS.
- -------- ---------------------------------

All accounts, books and other documents required to be
maintained by Section 31(a) of the 1940 Act, as amended, and the rules
promulgated thereunder with respect to the Registrant are maintained at the
offices of State Street Bank and Trust Company, 225 Franklin Street, Boston,
Massachusetts 02110, except for the Registrant's Trust Instrument and By-Laws,
minutes of meetings of the Registrant's Trustees and shareholders and the
Registrant's policies and contracts, which are maintained at the offices of the
Registrant, 605 Third Avenue, New York, New York 10158.

All accounts, books and other documents required to be
maintained by Section 31(a) of the 1940 Act, as amended, and the rules
promulgated thereunder with respect to Equity Managers Trust are maintained at
the offices of State Street Bank and Trust Company, 225 Franklin Street, Boston,
Massachusetts 02110, except for the Equity Managers Trust's Declaration of Trust
and By-laws, minutes of meetings of Equity Managers Trust's Trustees and
interest holders and Equity Managers Trust's policies and contracts, which are
maintained at the offices of the Equity Managers Trust, 605 Third Avenue, New
York, New York 10158.

ITEM 29. MANAGEMENT SERVICES
- -------- -------------------

Other than as set forth in Parts A and B of this
Post-Effective Amendment, the Registrant is not a party to any
management-related service contract.

ITEM 30. UNDERTAKINGS
- -------- ------------

None.

12
<PAGE>

SIGNATURES
----------

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant, NEUBERGER BERMAN EQUITY ASSETS
certifies that it meets all of the requirements for effectiveness of this
Post-Effective Amendment No. 17 to its Registration Statement pursuant to Rule
485(b) under the Securities Act of 1933 and has duly caused this Post-Effective
Amendment to its Registration Statement to be signed on its behalf by the
undersigned, thereto duly authorized, in the City and State of New York on the
30th day of November, 1999.

NEUBERGER BERMAN EQUITY ASSETS

By: /s/ Michael M. Kassen
---------------------
Michael M. Kassen
President

Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment No. 17 has been signed below by the following persons
in the capacities and on the date indicated.

Signature Title Date
- --------- ----- ----

/s/ Peter E. Sundman Chairman of the Board 11/30/99
- -------------------------- and Trustee (Chief
Peter E. Sundman Executive Officer)

/s/ Michael M. Kassen President and Trustee 11/30/99
- --------------------------
Michael M. Kassen

/s/ Michael J. Weiner Vice President 11/30/99
- -------------------------- (Principal Financial
Michael J. Weiner Officer)

/s/ Richard Russell Treasurer (Principal 11/30/99
- -------------------------- Accounting Officer)
Richard Russell

(signatures continued on next page)

<PAGE>

Signature Title Date
- --------- ----- ----

/s/ Faith Colish Trustee 11/30/99
- --------------------------
Faith Colish

/s/ Howard A. Mileaf Trustee 11/30/99
- --------------------------
Howard A. Mileaf

/s/ Edward I. O'Brien Trustee 11/30/99
- --------------------------
Edward I. O'Brien

/s/ John T. Patterson, Jr. Trustee 11/30/99
- --------------------------
John T. Patterson, Jr.

/s/ John P. Rosenthal Trustee 11/30/99
- --------------------------
John P. Rosenthal

/s/ Cornelius T. Ryan Trustee 11/30/99
- --------------------------
Cornelius T. Ryan

/s/ Gustave H. Shubert Trustee 11/30/99
- --------------------------
Gustave H. Shubert

<PAGE>

SIGNATURES
----------

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, EQUITY MANAGERS TRUST certifies that it meets
all of the requirements for effectiveness of Post-Effective Amendment No. 17 to
the Registration Statement pursuant to Rule 485(b) under the Securities Act of
1933 and has duly caused this Post-Effective Amendment to the Registration
Statement to be signed on its behalf by the undersigned, thereto duly
authorized, in the City and State of New York on the 30th day of November, 1999.

EQUITY MANAGERS TRUST

By: /s/ Michael M. Kassen
---------------------
Michael M. Kassen
President

Pursuant to the requirements of the Securities Act of 1933, the
Post-Effective Amendment No. 17 has been signed below by the following persons
in the capacities and on the date indicated.

Signature Title Date
- --------- ----- ----

/s/ Peter E. Sundman Chairman of the Board 11/30/99
- -------------------------- and Trustee (Chief
Peter E. Sundman Executive Officer)

/s/ Michael M. Kassen President and Trustee 11/30/99
- --------------------------
Michael M. Kassen

/s/ Michael J. Weiner Vice President
- -------------------------- (Principal Financial 11/30/99
Michael J. Weiner Officer)

/s/ Richard Russell Treasurer (Principal 11/30/99
- -------------------------- Accounting Officer)
Richard Russell

(signatures continued on next page)

<PAGE>

Signature Title Date
- --------- ----- ----

/s/ Faith Colish Trustee 11/30/99
- --------------------------
Faith Colish

/s/ Howard A. Mileaf Trustee 11/30/99
- --------------------------
Howard A. Mileaf

/s/ Edward I. O'Brien Trustee 11/30/99
- --------------------------
Edward I. O'Brien

/s/ John T. Patterson, Jr. Trustee 11/30/99
- --------------------------
John T. Patterson, Jr.

/s/ John P. Rosenthal Trustee 11/30/99
- --------------------------
John P. Rosenthal

/s/ Cornelius T. Ryan Trustee 11/30/99
- --------------------------
Cornelius T. Ryan

/s/ Gustave H. Shubert Trustee 11/30/99
- ---------------------
Gustave H. Shubert

<PAGE>
NEUBERGER BERMAN EQUITY ASSETS

POST-EFFECTIVE AMENDMENT NO. 17 ON FORM N-1A

INDEX TO EXHIBITS

EXHIBIT
NUMBER DESCRIPTION
------ -----------

(a) (1) Certificate of Trust. Incorporated by Reference
to Post-Effective Amendment No. 1 to
Registrant's Registration Statement, File Nos.
33-82568 and 811-8106.

(2) Restated Certificate of Trust. Incorporated by
Reference to Post-Effective Amendment No. 13 to
Registrant's Registration Statement, File Nos.
33-82568 and 811-8106.

(3) Trust Instrument of Neuberger Berman Equity
Assets. Incorporated by Reference to
Post-Effective Amendment No. 1 to Registrant's
Registration Statement, File Nos. 33-82568 and
811-8106.

(b) By-Laws of Neuberger Berman Equity Assets.
Incorporated by Reference to Post-Effective
Amendment No. 1 to Registrant's Registration
Statement, File Nos. 33-82568 and 811-8106.

<PAGE>

EXHIBIT
NUMBER DESCRIPTION
------ -----------

(e) (1) (i) Distribution Agreement Between Neuberger
Berman Equity Assets and Neuberger
Berman Management Inc. with Respect to
Neuberger Berman Socially Responsive
Trust. Incorporated by Reference to
Post-Effective Amendment No. 9 to
Registrant's Registration Statement,
File Nos. 33-82568 and 811-8106.

(ii) Schedule A - Series of Neuberger Berman
Equity Assets Currently Subject to the
Distribution Agreement. Incorporated by
Reference to Post-Effective Amendment
No. 16 to Registrant's Registration
Statement, File Nos. 33-82568 and
811-8106.

(2) (i) Distribution and Services Agreement
Between Neuberger Berman Equity Assets
and Neuberger Berman Management Inc.
With Respect to Other Series.
Incorporated by Reference to
Post-Effective Amendment No. 9 to
Registrant's Registration Statement,
File Nos. 33-82568 and 811-8106.

(f) Bonus, Profit Sharing or Pension Plans. None.

(g) (1) Custodian Contract Between Neuberger Berman
Equity Assets and State Street Bank and Trust
Company. Incorporated by Reference to
Post-Effective Amendment No. 3 to Registrant's
Registration Statement, File Nos. 33-82568 and
811-8106.

(2) Schedule of Compensation under the Custodian
Contract. Incorporated by Reference to
Post-Effective Amendment No. 4 to Registrant's
Registration Statement, File Nos. 33-82568 and
811-8106.

<PAGE>

EXHIBIT
NUMBER DESCRIPTION
------ -----------

<PAGE>

EXHIBIT
NUMBER DESCRIPTION
------ -----------

(d) Consent to use Previously Filed Opinions
of Kirkpatrick & Lockhart LLP on
Securities Matters. Filed herewith.

(j) Consent of Independent Auditors. Filed herewith.

(k) Financial Statements Omitted from Prospectus.
None.

(l) Letter of Investment Intent. None.

(m) (a) Plan Pursuant to Rule 12b-1. Incorporated by
Reference to Post-Effective Amendment No. 9 to
Registrant's Registration Statement, File Nos.
33-82568 and 811-8106.

(b) Schedule A - Series of Neuberger Berman Equity
Assets Currently Subject to Plan Pursuant to
Rule 12b-1. Incorporated by Reference to
Post-Effective Amendment No. 16 to Registrant's
Registration Statement, File Nos. 33-82568 and
811-8106.

(n) Financial Data Schedule. Not Applicable.

(o) Plan Pursuant to Rule 18f-3. None.

Consent Authorizing Use of Previously-filed Legal Opinion
for Neuberger Berman Equity Assets ("Registrant")

In connection with Post-Effective Amendment Nos. 16 and 17 to Registrant's
Registration Statement on Form N-1A (File Nos. 33-82568 and 811-8106) to be
filed with the Securities and Exchange Commission on or about November 30, 1999,
we hereby consent to the continued use of the Opinion and Consent of Kirkpatrick
& Lockhart LLP on Securities Matters with respect to Neuberger Berman Equity
Assets and its series Neuberger Berman Focus Assets, Neuberger Berman Guardian
Assets, Neuberger Berman Manhattan Assets, and Neuberger Berman Partners Assets,
previously filed in Post-Effective Amendment No. 3 to Registrant's Registration
Statement on Form N-1A (File Nos. 33-82568 and 811-8106); the Opinion and
Consent of Kirkpatrick & Lockhart LLP on Securities Matters with respect to
Neuberger Berman Genesis Assets previously filed in Post-Effective Amendment No.
9 to Registrant's Registration Statement on Form N-1A (File Nos. 33-82568 and
811-8106); and the Opinion and Consent of Kirkpatrick & Lockhart LLP on
Securities Matters with respect to Neuberger Berman Socially Responsive Assets
previously filed in Post-Effective Amendment No. 1 the Registration Statement of
Neuberger Berman Equity Series on Form N-1A (File Nos. 333-66137 and 811-09011).
We further consent to the filing of this consent in connection with
Post-Effective Amendment Nos. 16 and 17 to Registrant's Registration Statement.
We also consent to the reference to our firm in the Statement of Additional
Information filed as part of the Registration Statement.

Sincerely,

/s/ KIRKPATRICK & LOCKHART LLP

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference into the Prospectus and
Statement of Additional Information constituting the Post-Effective Amendment
No. 16 and 17 to the Registration Statement on Form N-1A (the "Registration
Statement") of Neuberger Berman Equity Assets (the "Assets") on the financial
statements and financial highlights appearing in the August 31, 1999 Annual
Report to the Shareholders. We further consent to the references to our Firm
under the heading "Financial Highlights" in the Prospectus and "Experts" in the
Statement of Additional Information.

/s/ PricewaterhouseCoopers LLP
- ------------------------------
PricewaterhouseCoopers LLP
Boston, Massachusetts
November 24, 1999

<PAGE>

CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS

We consent to the references to our firm under the captions "Financial
Highlights" in the Prospectus and "Reports to Shareholders", "Independent
Auditors/Accountants" and "Financial Statements" in the Statement of Additional
Information in Post-Effective Amendment Number 17 to the Registration Statement
(Form N-1A, No. 33-82568) of Neuberger Berman Equity Assets, and to the
incorporation by reference of our reports dated October 1, 1999 on Neuberger
Berman Focus Assets, Neuberger Berman Genesis Assets, Neuberger Berman Guardian
Assets, and Neuberger Berman Partners Assets, four of the series comprising
Neuberger Berman Equity Assets, and on Neuberger Berman Focus Portfolio,
Neuberger Berman Genesis Portfolio, Neuberger Berman Guardian Portfolio, and
Neuberger Berman Partners Portfolio, four of the series comprising Equity
Managers Trust, included in the 1999 Annual Report to Shareholders of Neuberger
Berman Equity Assets.

/s/ ERNST & YOUNG LLP

Boston, Massachusetts
November 26, 1999