Neuberger Berman
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Annual Report
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Contents | |||
PRESIDENT’S LETTER | 1 | ||
PORTFOLIO COMMENTARY | 2 | ||
SCHEDULE OF INVESTMENTS | 7 | ||
FINANCIAL STATEMENTS | 10 | ||
FINANCIAL HIGHLIGHTS/PER SHARE DATA | 19 | ||
Report of Independent Registered Public Accounting Firm | 21 | ||
Distribution Reinvestment Plan | 22 | ||
Directory | 25 | ||
Directors and Officers | 26 | ||
Proxy Voting Policies and Procedures | 34 | ||
Quarterly Portfolio Schedule | 34 | ||
Report of Votes of Stockholders | 35 | ||
Board Consideration of the Management and | |||
Sub-Advisory Agreements | 36 |
Dear Stockholder,
I am pleased to present the annual report for Neuberger Berman MLP Income Fund Inc., covering the 12 months ended November 30, 2014. The report includes portfolio commentary, a listing of the Fund’s investments, and its audited financial statements for the reporting period.
The Fund seeks to provide total return with an emphasis on cash distributions. To pursue this objective, we have assembled a portfolio that consists primarily of Master Limited Partnerships (MLPs) and select companies that have economic characteristics substantially similar to MLPs. The portfolio management team currently emphasizes mid-stream natural resources companies.
In an effort to enhance overall income generating capability, the Fund uses leverage in the form of a $500 million leverage financing facility. As of the fiscal year end, $410 million of the $500 million leverage financing facility had been utilized. Fund investors need to be aware of the impacts that leverage can produce. Leverage can magnify both gains and losses. The use of leverage can also increase income generation and cash flow.
Thank you for your confidence in the Fund. We will continue to do our best to earn your trust in the years to come.
Sincerely,
Robert Conti
President and CEO
Neuberger Berman MLP Income Fund Inc.
1
Neuberger Berman MLP Income Fund Inc. generated an 11.89% return on a net asset value (NAV) basis for the 12 months ended November 30, 2014, but underperformed its benchmark, the Alerian MLP Index, which posted a 12.87% return for the same period. (Fund performance on a market price basis is provided in the table immediately following this letter.)
We manage a concentrated portfolio focused primarily on midstream companies that facilitate the processing, transportation and storage of natural gas, natural gas liquids and crude oil. These companies have businesses that have historically generated stable cash flow with little direct commodity price exposure. Within our portfolio strategy, we overweight positions in natural gas focused MLPs and maintain a large weighting in publicly traded general partnerships. Our portfolio has an overlap with the Alerian MLP Index, which includes a broader category of energy MLPs but excludes general partnerships.
Our investment thesis centers around the U.S. “shale revolution” and the expectation that the substantial oil and gas resource base contained in this country could require billions of dollars of infrastructure investment over the next several decades to facilitate its development. MLPs are building this required infrastructure based on multi-year customer commitments that would provide attractive rates of return on the MLPs’ capital investment. We believe that the cash flow generated from these projects coupled with the current low cost of capital environment could support long-term distribution growth for our portfolio companies.
Our portfolio consists mostly of companies that own and operate natural gas pipelines, processing and storage facilities, as well as export facilities. We believe these companies are positioned to benefit from what we see as a very favorable long-term outlook for natural gas given its abundant domestic supply, relatively low cost and clean burning characteristics. We also think that demand for natural gas will continue to grow for power, industrial and residential uses. In addition, toward the end of 2015 or in early 2016, the first of several major U.S. projects to export liquefied natural gas are anticipated to go into service.
Commodity price volatility can impact our portfolio’s performance periodically, although the long-term correlation has been relatively low. The dramatic drop in crude prices of more than 40% from the summer peak of $110 per barrel has indeed put pressure on energy stocks and our MLP portfolio has not been immune. However, we are confident in the stability of the cash flow stream of our portfolio companies and their growth outlook, which is tied to the development of the U.S. oil and natural gas shale resource base. Importantly, we think the U.S. is well positioned as a low cost producer to continue to grow its oil and natural gas production notwithstanding short-term swings in commodity prices. Under this thesis, the requirement for additional infrastructure to support this production growth should continue albeit at perhaps a slower pace the longer crude prices remain depressed.
The use of leverage had a positive impact on Fund performance during the 12-month period.
We will remain disciplined in our investment approach, selecting midstream companies that in our view have top-tier management teams, high-quality assets and strong balance sheets. These companies generally generate stable cash flows and appear well positioned to participate in the U.S. shale revolution via their infrastructure investments.
Sincerely,
Douglas Rachlin
Lead Portfolio Manager
Yves C. Siegel
Portfolio Manager
2
The opinions expressed are those of the Fund’s portfolio managers. The opinions are as of the date of this report and are subject to change without notice.
The value of securities owned by the Fund as well as the market value of Fund shares of common stock may decline in response to certain events, including those directly involving the issuers whose securities are owned by the Fund; conditions affecting the general economy; overall market changes; local, regional, national or global political, social or economic instability; regulatory or legislative developments; price, currency and interest rate fluctuations, including those resulting from changes in central bank policies; and changes in investor sentiment.
3
TICKER SYMBOL | ||
MLP Income Fund Inc. | NML | |
PORTFOLIO BY TYPE OF SECURITY | ||
(as a % of Total Investments) | ||
Master Limited Partnerships and | ||
Related Companies | 99.8 | % |
Short-Term Investments | 0.2 | |
Total | 100.0 | % |
PERFORMANCE HIGHLIGHTS | ||||||||||||
Average Annual Total Return | ||||||||||||
Inception | Ended 11/30/2014 | |||||||||||
Date* | 1 Year | Life of Fund | ||||||||||
At NAV1 | 03/25/2013 | 11.89% | 11.42 | % | ||||||||
At Market Price2 | 03/25/2013 | 11.39% | 3.08 | % | ||||||||
Index | ||||||||||||
Alerian MLP Index3 | 12.87% | 11.65 | % |
* Date of initial public offering. The Fund commenced operations on March 28, 2013.
Closed-end funds, unlike open-end funds, are not continually offered. Generally, there is an initial public offering and, once issued, shares of common stock of closed-end funds are sold in the open market through a stock exchange.
The performance data quoted represent past performance and do not indicate future results. Current performance may be lower or higher than the performance data quoted. For more current performance data, please visit www.nb.com/performance.
The results shown in the table reflect the reinvestment of income dividends and other distributions, if any. The results do not reflect the effect of taxes a stockholder would pay on Fund distributions or on the sale of Fund shares of common stock.
The investment return and market price will fluctuate and shares of common stock may trade at prices below NAV. Fund shares of common stock, when sold, may be worth more or less than their original cost.
4
1 | Returns based on the NAV of the Fund. | |
2 | Returns based on the market price of Fund shares of common stock on the NYSE MKT. | |
3 | Please see “Description of Index” on page 6 for a description of the index. |
For more complete information on Neuberger Berman MLP Income Fund Inc., call Neuberger Berman Management LLC ( Management) at (800) 877-9700, or visit our website at www.nb.com.
5
Alerian MLP Index: | The Alerian MLP Index is a float-adjusted, capitalization-weighted index that is a composite of 50 prominent energy Master Limited Partnerships (MLPs), which captures approximately 75% of available market capitalization. It is the leading gauge of large- and mid-cap energy MLPs. Effective June 2013, general partner (G.P.) units were no longer included in the index. |
Please note that the index does not take into account any fees and expenses or any tax consequences of investing in the individual securities that it tracks and that individuals cannot invest directly in any index. Data about the performance of this index are prepared or obtained by Management and include reinvestment of all income dividends and other distributions, if any. The Fund may invest in securities not included in the above described index and generally does not invest in all securities included in the index.
6
NUMBER OF SHARES | VALUE† | ||||
Master Limited Partnerships and Related Companies (145.0%) | |||||
Coal & Consumable Fuels (9.0%) | |||||
1,315,822 | Alliance Holdings GP, L.P. | $ | 88,199,549 | µ | |
360,000 | Alliance Resource Partners, L.P. | 16,581,600 | µ | ||
104,781,149 | |||||
Leisure Facilities (8.8%) | |||||
2,164,700 | Cedar Fair L.P. | 103,321,131 | µ | ||
Oil & Gas Storage & Transportation (115.9%) | |||||
693,352 | American Midstream Partners LP | 15,475,617 | |||
5,720,987 | Crestwood Equity Partners LP | 51,488,883 | µ | ||
4,202,555 | Crestwood Midstream Partners LP | 84,387,304 | µ | ||
280,000 | Enable Midstream Partners, LP | 5,633,600 | µ | ||
2,000,000 | Enbridge Energy Partners, L.P. | 75,000,000 | µ | ||
3,650,000 | Energy Transfer Equity, L.P. | 216,773,500 | µ | ||
779,700 | Energy Transfer Partners, L.P. | 50,813,049 | µ | ||
880,000 | Enterprise Products Partners L.P. | 32,859,200 | µ | ||
276,000 | JP Energy Partners LP | 4,029,600 | µ | ||
360,000 | Midcoast Energy Partners, L.P. | 5,544,000 | µ | ||
1,900,000 | NGL Energy Partners LP | 66,310,000 | |||
613,741 | NuStar Energy L.P. | 34,369,496 | µ | ||
1,060,636 | NuStar GP Holdings, LLC | 36,443,453 | µ | ||
1,750,000 | Oneok Inc. | 94,780,000 | µ | ||
9,460,000 | Regency Energy Partners LP | 269,515,400 | µ | ||
1,860,068 | Southcross Energy Partners, L.P. | 32,439,586 | §µ | ||
700,000 | Spectra Energy Corp | 26,516,000 | µ | ||
500,000 | Spectra Energy Partners, LP | 26,985,000 | µ | ||
215,000 | Summit Midstream Partners, LP | 9,761,000 | µ | ||
900,000 | Teekay LNG Partners L.P. | 32,418,000 | µ | ||
2,017,703 | Teekay Offshore Partners L.P. | 51,875,144 | µ | ||
316,000 | Western Gas Partners, LP | 22,413,880 | |||
1,560,000 | Williams Companies, Inc. | 80,730,000 | µ | ||
546,400 | Williams Partners L.P. | 28,270,736 | µ | ||
1,354,832,448 | |||||
Propane (11.3%) | |||||
785,575 | AmeriGas Partners, L.P. | 36,285,709 | µ | ||
2,130,000 | Suburban Propane Partners, L.P. | 95,850,000 | µ | ||
132,135,709 | |||||
Total Master Limited Partnerships and Related Companies (Cost $1,340,393,553) | 1,695,070,437 | ||||
Short-Term Investments (0.3%) | |||||
3,484,955 | Invesco STIT Treasury Portfolio Money Market Fund Institutional Class (Cost $3,484,955) | 3,484,955 | |||
Total Investments (145.3%) (Cost $1,343,878,508) | 1,698,555,392 | ## | |||
Liabilities, less cash, receivables and other assets [(45.3%)] | (529,776,825 | ) | |||
Total Net Assets Applicable to Common Stockholders (100.0%) | $ | 1,168,778,567 |
See Notes to Schedule of Investments | 7 |
† |
In accordance with Accounting Standards Codification (“ASC”) 820 “Fair Value Measurement” (“ASC 820”), all investments held by Neuberger Berman MLP Income Fund Inc. (the “Fund”) are carried at the value that Neuberger Berman Management LLC (“Management”) believes the Fund would receive upon selling an investment in an orderly transaction to an independent buyer in the principal or most advantageous market for the investment under current market conditions. Various inputs, including the volume and level of activity for the asset or liability in the market, are considered in valuing the Fund’s investments, some of which are discussed below. Significant management judgment may be necessary to value investments in accordance with ASC 820. ASC 820 established a three-tier hierarchy of inputs to create a classification of value measurements for disclosure purposes. The three-tier hierarchy of inputs is summarized in the three broad Levels listed below. |
●Level 1 – quoted prices in active markets for identical investments
●Level 2 – other observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, amortized cost, etc.)
●Level 3 – unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)
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The inputs or methodology used for valuing an investment are not necessarily an indication of the risk associated with investing in those securities. The value of the Fund’s investments in equity securities (including master limited partnerships) and written option contracts, for which market quotations are readily available, is generally determined by Management by obtaining valuations from an independent pricing service based on the latest sale price quoted on a principal exchange or market for that security (Level 1 inputs). Securities traded primarily on the NASDAQ Stock Market are normally valued at the NASDAQ Official Closing Price (“NOCP”) provided by NASDAQ each business day. The NOCP is the most recently reported price as of 4:00:02 p.m., Eastern time, unless that price is outside the range of the “inside” bid and asked prices (i.e., the bid and asked prices that dealers quote to each other when trading for their own accounts); in that case, NASDAQ will adjust the price to equal the inside bid or asked price, whichever is closer. Because of delays in reporting trades, the NOCP may not be based on the price of the last trade to occur before the market closes. If there is no reported sale of a security on a particular day, the independent pricing service may value the security based on reported market quotations. The value of the Fund’s investments in certain preferred stock is determined by Management by obtaining valuations from independent pricing services that are based on market information which may include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, benchmark securities, bids, offers and reference data, such as market research publications, when available (generally Level 2 inputs). The value of the Fund’s investments in equity securities of publicly traded companies acquired in a direct placement transaction may be subject to restrictions on resale that can affect the security’s liquidity and fair value. Such securities that are convertible or otherwise will become freely tradable will typically be valued based on the market value of the freely tradable security less an applicable discount. Inputs used generally include the duration of the restriction period and the discount on purchase date. Management has developed a process to periodically review information provided by independent pricing services for all types of securities. Investments in investment companies are valued using the respective fund’s daily calculated net asset value per share (Level 2 inputs). |
See Notes to Financial Statements | 8 |
If a valuation is not available from an independent pricing service, or if Management has reason to believe that the valuation received does not represent the amount the Fund might reasonably expect to receive on a current sale in an orderly transaction, Management seeks to obtain quotations from brokers or dealers (generally considered Level 2 or Level 3 inputs depending on the number of quotes available). If such quotations are not readily available, the security is valued using methods the Fund’s Board of Directors (the “Board”) has approved in the good-faith belief that the resulting valuation will reflect the fair value of the security. Numerous factors may be considered when determining the fair value of a security based on Level 2 or Level 3 inputs, including available analyst, media or other reports, trading in futures or American Depositary Receipts (“ADRs”) and whether the issuer of the security being fair valued has other securities outstanding.
Fair value prices are necessarily estimates, and there is no assurance that such a price will be at or close to the price at which the security is next quoted or next trades.
The following is a summary, categorized by Level, of inputs used to value the Fund’s investments as of November 30, 2014:
Asset Valuation Inputs | |||||||||||
Investments: | Level 1 | Level 2 | Level 3 | Total | |||||||
Master Limited Partnerships and | |||||||||||
Related Companies | |||||||||||
Coal & Consumable Fuels | $ | 104,781,149 | $ | — | $— | $ | 104,781,149 | ||||
Leisure Facilities | 103,321,131 | — | — | 103,321,131 | |||||||
Oil & Gas Storage & Transportation | 1,354,832,448 | — | — | 1,354,832,448 | |||||||
Propane | 132,135,709 | — | — | 132,135,709 | |||||||
Total Master Limited Partnerships and | |||||||||||
Related Companies | 1,695,070,437 | — | — | 1,695,070,437 | |||||||
Short-Term Investments | — | 3,484,955 | — | 3,484,955 | |||||||
Total Investments | $ | 1,695,070,437 | $ | 3,484,955 | $— | $ | 1,698,555,392 |
As of the year ended November 30, 2014, certain securities were transferred from one level (as of November 30, 2013) to another. Based on beginning of period market values as of November 30, 2013, approximately $64,840,000 was transferred from Level 2 to Level 1 as a result of a restricted security registering shares under the Securities Act of 1933, as amended, and $14,296,075 was transferred from Level 2 to Level 1 as a result of preferred stock converting to common stock. As of the year ended November 30, 2014, the Fund had no transfers between Levels 2 and 3, based on beginning of period market values as of November 30, 2013. |
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## |
At November 30, 2014, the cost of investments for U.S. federal income tax purposes was $1,267,080,144. Gross unrealized appreciation of investments was $431,475,248 and gross unrealized depreciation of investments was $0 resulting in net unrealized appreciation of $431,475,248 based on cost for U.S. federal income tax purposes. |
§ |
Affiliated issuer (see Note E of Notes to Financial Statements). |
µ |
All or a portion of this security is pledged in connection with the Fund’s loans payable. |
See Notes to Financial Statements | 9 |
Neuberger Berman | |||
MLP INCOME | |||
FUND INC. | |||
November 30, 2014 | |||
Assets | |||
Investments in securities, at value* (Notes A & E)—see Schedule of Investments: | |||
Unaffiliated issuers | $1,666,115,806 | ||
Affiliated issuers | 32,439,586 | ||
1,698,555,392 | |||
Cash | 8,370,926 | ||
Dividends and interest receivable | 259,066 | ||
Prepaid expenses and other assets | 22,560 | ||
Total Assets | 1,707,207,944 | ||
Liabilities | |||
Loans payable (Note A) | 410,000,000 | ||
Deferred tax liability (Note A) | 117,348,831 | ||
Payable for investments purchased | 9,016,320 | ||
Distributions payable—common stock | 245,667 | ||
Payable to investment manager (Note B) | 992,910 | ||
Payable to administrator (Note B) | 330,970 | ||
Payable to directors | 4,392 | ||
Interest payable (Note A) | 93,555 | ||
Accrued expenses and other payables | 396,732 | ||
Total Liabilities | 538,429,377 | ||
Net Assets applicable to Common Stockholders | $1,168,778,567 | ||
Net Assets applicable to Common Stockholders consist of: | |||
Paid-in capital—common stock | 964,967,796 | ||
Accumulated net investment income (loss), net of income taxes | 15,179,044 | ||
Accumulated net realized gains (losses) on investments, net of income taxes | (5,028,128 | ) | |
Net unrealized appreciation (depreciation) in value of investments, net of income taxes | 193,659,855 | ||
Net Assets applicable to Common Stockholders | $1,168,778,567 | ||
Shares of Common Stock Outstanding ($.0001 par value; 1,000,000,000 shares authorized) | 56,523,532 | ||
Net Asset Value Per Share of Common Stock Outstanding | $20.68 | ||
* Cost of Investments | |||
Unaffiliated issuers | $1,312,885,735 | ||
Affiliated issuer | 30,992,773 | ||
Total cost of investments | $1,343,878,508 |
See Notes to Financial Statements | 10 |
Neuberger Berman | |||
MLP INCOME | |||
FUND INC. | |||
For the | |||
Year Ended | |||
November 30, 2014 | |||
Investment Income: | |||
Income (Note A): | |||
Dividend income from master limited partnerships and related companies | |||
(includes $2,888,138 from affiliated issuers (Note E)) | $95,033,451 | ||
Return of capital on dividends | (88,283,192 | ) | |
Net dividend income from master limited partnerships and related companies | 6,750,259 | ||
Interest income—unaffiliated issuers | 1,326 | ||
Total income | $6,751,585 | ||
Expenses: | |||
Investment management fees (Note B) | 12,000,458 | ||
Administration fees (Note B) | 4,000,153 | ||
Audit fees | 100,963 | ||
Custodian fees | 485,304 | ||
Insurance expense | 44,648 | ||
Legal fees | 223,945 | ||
Stock exchange listing fees | 24,097 | ||
Stockholder reports | 124,645 | ||
Stock transfer agent fees | 20,561 | ||
Interest expense (Note A) | 3,976,189 | ||
Directors’ fees and expenses | 31,799 | ||
Miscellaneous | 30,736 | ||
Total expenses | 21,063,498 | ||
Net investment income (loss), before income taxes | (14,311,913 | ) | |
Deferred tax benefit | 32,772,696 | ||
Net investment income (loss) | $18,460,783 | ||
Realized and Unrealized Gain (Loss) on Investments (Note A): | |||
Net realized gain (loss) on: | |||
Sales of investment securities of unaffiliated issuers | (13,518,472 | ) | |
Option contracts written | 122,667 | ||
Deferred tax benefit | $7,820,582 | ||
Change in net unrealized appreciation (depreciation) in value of: | |||
Unaffiliated investment securities | 222,853,056 | ||
Affiliated investment securities | 2,899,272 | ||
Deferred tax expense | (112,602,914 | ) | |
Net gain (loss) on investments | 107,574,191 | ||
Net increase (decrease) in net assets applicable to Common Stockholders resulting from operations | $126,034,974 |
See Notes to Financial Statements | 11 |
Neuberger Berman | ||||||
MLP INCOME FUND INC. | ||||||
Period from | ||||||
March 28, 2013* | ||||||
Year Ended | through | |||||
November 30, 2014 | November 30, 2013 | |||||
Increase (Decrease) in Net Assets Applicable to Common Stockholders: | ||||||
From Operations (Note A): | ||||||
Net investment income (loss) | $18,460,783 | $(3,281,739 | ) | |||
Net realized gain (loss) on investments | (5,575,223 | ) | 547,095 | |||
Change in net unrealized appreciation (depreciation) of investments | 113,149,414 | 80,510,441 | ||||
Net increase (decrease) in net assets applicable to common stockholders | ||||||
resulting from operations | 126,034,974 | 77,775,797 | ||||
Distributions to Common Stockholders From (Note A): | ||||||
Tax return of capital | (71,219,650 | ) | (41,539,776 | ) | ||
From Capital Share Transactions (Note D): | ||||||
Net proceeds from initial capitalization | — | 100,000 | ||||
Net proceeds from issuance of common stock | — | 1,077,352,150 | ||||
Proceeds from reinvestment of dividends and distributions | — | 275,072 | ||||
Total net proceeds from capital share transactions | — | 1,077,727,222 | ||||
Net Increase (Decrease) in Net Assets Applicable to Common Stockholders | 54,815,324 | 1,113,963,243 | ||||
Net Assets Applicable to Common Stockholders: | ||||||
Beginning of period | 1,113,963,243 | — | ||||
End of period | $1,168,778,567 | $1,113,963,243 | ||||
Accumulated net investment income (loss) at end of period | $15,179,044 | $(3,281,739 | ) | |||
Distributions in excess of net investment income at end of period | $(71,219,650 | ) | $(41,539,776 | ) | ||
* Commencement of operations. |
See Notes to Financial Statements | 12 |
Neuberger Berman | |||
MLP INCOME | |||
FUND INC. | |||
For The Year Ended | |||
November 30, 2014 | |||
Increase (decrease) in cash: | |||
Cash flows from operating activities: | |||
Net increase in net assets applicable to Common Stockholders | |||
resulting from operations | $126,034,974 | ||
Adjustments to reconcile net increase in net assets applicable to | |||
Common Stockholders resulting from operations to net | |||
cash used in operating activities: | |||
Changes in assets and liabilities: | |||
Purchase of investment securities | (183,522,869 | ) | |
Proceeds from disposition of investment securities | 163,328,103 | ||
Proceeds from call options written | 122,667 | ||
Purchase/sale of short-term investment securities, net | 9,314,954 | ||
Decrease in dividends and interest receivable | 2,170,350 | ||
Increase in prepaid expenses and other assets | (6,187 | ) | |
Increase in payable for securities purchased | 9,016,320 | ||
Increase in payable to investment manager | 62,883 | ||
Increase in payable to administrator | 20,961 | ||
Decrease in payable to Directors | (886 | ) | |
Increase in interest payable | 69,858 | ||
Decrease in offering costs payable | (5,000 | ) | |
Increase in accrued expenses and other payables | 39,972 | ||
Return of capital on dividends | 88,283,192 | ||
Deferred tax expense | 72,009,636 | ||
Unrealized appreciation on securities | (225,752,328 | ) | |
Net realized loss from investments | 13,395,805 | ||
Net cash provided by operating activities | $74,582,405 | ||
Cash flows from financing activities: | |||
Cash distributions paid on Common Stock | (71,211,479 | ) | |
Cash receipts from loans | 10,000,000 | ||
Cash disbursement from loans | (5,000,000 | ) | |
Net cash used in financing activities | (66,211,479 | ) | |
Net increase (decrease) in cash | 8,370,926 | ||
Cash: | |||
Beginning balance | 0 | ||
Ending balance | $8,370,926 | ||
Supplemental disclosure | |||
Cash paid for interest | $3,906,331 |
See Notes to Financial Statements | 13 |
1 | General:The Fund was organized as a Maryland corporation on November 16, 2012 as a non-diversified, closed-end management investment company under the Investment Company Act of 1940, as amended (the “1940 Act”). The Fund commenced operations on March 28, 2013. The Board may classify or re-classify any unissued shares of capital stock into one or more classes of preferred stock without the approval of stockholders. |
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 “Financial Services – Investment Companies.” | |
The preparation of financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”) requires Management to make estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. | |
2 | Portfolio valuation:Investment securities are valued as indicated in the notes following the Schedule of Investments. |
3 | Securities transactions and investment income:Securities transactions are recorded on trade date for financial reporting purposes. Dividend and distribution income is recorded on the ex-date. Distributions received from the Fund’s investments in master limited partnerships or limited liability companies that have economic characteristics substantially similar to master limited partnerships (collectively, “MLPs”) generally are comprised of ordinary income and return of capital from the MLPs. The Fund allocates distributions between income and return of capital based on estimates made at the time such distributions are received. Such estimates are based on information provided by each MLP and other industry sources. These estimates may subsequently be revised based on actual allocations received from MLPs after their tax reporting periods are concluded, as the actual character of these distributions is not known until after the fiscal year end of the Fund. For the year ended November 30, 2014, the Fund estimated the allocation of investment income and return of capital for the distributions received from MLPs within the Statement of Operations. For this year, the Fund has estimated approximately 0.3% as income and approximately 99.7% as return of capital. |
Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income, including accretion of original issue discount, where applicable, and accretion of discount on short-term investments, if any, is recorded on the accrual basis. Realized gains and losses from securities transactions are recorded on the basis of identified cost and stated separately in the Statement of Operations. | |
4 | Income tax information:The Fund, as a corporation, is obligated to pay federal and state income tax on its taxable income. Currently, the highest regular marginal federal income tax rate for a corporation is 35%. The Fund may be subject to a 20% federal alternative minimum tax (“AMT”) on its federal alternative minimum taxable income to the extent that its AMT exceeds its regular federal income tax. |
The Fund invests its assets primarily in MLPs, which generally are treated as partnerships for federal income tax purposes. As a limited partner in the MLPs, the Fund reports its allocable share of the MLP’s taxable income or loss in computing its own taxable income or loss. The Fund’s income tax expense or benefit is included in the Statement of Operations based on the component of income or gains (losses) to which such expense or benefit relates. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is recognized if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred income tax asset will not be realized. |
14
Deferred tax assets: | ||
Net operating loss carryforwards | $35,847,620 | |
Capital loss carryforwards | 7,820,582 | |
Unrealized losses on investment securities | 17,691,554 | |
61,359,756 | ||
Deferred tax liabilities: | ||
Unrealized gains on investment securities | 178,708,587 | |
Total net deferred tax liability | $117,348,831 |
At November 30, 2014, a valuation allowance on deferred tax assets was not deemed necessary because Management believes it is more likely than not that the Fund will be able to recognize its deferred tax assets through future taxable income. The impact of any adjustments to the Fund’s estimates of future taxable income will be made in the same period that such determination is made. The Fund recognizes the tax benefits of uncertain tax positions only when the position is “more likely than not” to be sustained upon examination by the tax authorities based on the technical merits of the tax position. The Fund’s policy is to record interest and penalties on uncertain tax positions as part of tax expense. As of November 30, 2014, the Fund had no uncertain tax positions.
Total income tax expense differs from the amount computed by applying the federal statutory income tax rate of 35% to net investment loss and net realized and unrealized gains on investments for the year ended November 30, 2014, as follows:
Application of statutory income tax rate | $69,658,902 | |||
State income taxes, net of federal tax benefit | 4,441,866 | |||
Tax benefit on permanent items | (1,730,889 | ) | ||
Tax benefit due to change in effective state rates | (85,276 | ) | ||
Return to provision adjustments | (274,967 | ) | ||
Total income tax expense | $72,009,636 |
Total income taxes are computed by applying the federal statutory rate plus a blended state income tax rate.
Net operating loss carryforwards and capital loss carryforwards are available to offset future taxable income. The Fund has the following net operating loss carryforwards and capital loss carryforwards amounts:
Net Operating Loss | ||||
Fiscal Period Ended | Carryforwards | Expiration | ||
November 30, 2013 | $8,980,929 | November 30, 2033 | ||
November 30, 2014 | 87,279,023 | May 31, 2034 | ||
$96,259,952 | ||||
Capital Loss | ||||
Fiscal Period Ended | Carryforwards | Expiration | ||
November 30, 2014 | $21,003,704 | May 31, 2019 |
5 | Distributions to common stockholders: It is the policy of the Fund to declare quarterly and pay monthly distributions to common stockholders. The Fund has adopted a policy to pay common stockholders a stable monthly distribution. The Fund currently intends to pay distributions out of its distributable cash flow, which generally consists of cash and paid-in-kind distributions from MLPs or their affiliates, dividends from common stocks, interest from debt instruments and income from other investments held by the Fund less current or accrued operating expenses of the Fund, including taxes on Fund taxable income and leverage costs. Distributions to common stockholders relating to in-kind dividends or distributions received by the Fund on its investments will be paid in cash or additional shares of |
15
6 | Expense allocation: Certain expenses are applicable to multiple funds within the complex of related investment companies. Expenses directly attributable to the Fund are charged to the Fund. Expenses borne by the complex of related investment companies, which includes open-end and closed-end investment companies for which Management serves as investment manager, that are not directly attributable to a particular investment company (e.g., the Fund) are allocated among the Fund and the other investment companies or series thereof in the complex on the basis of relative net assets, except where a more appropriate allocation of expenses to each of the investment companies or series thereof in the complex can otherwise be made fairly. |
7 | Financial leverage: In July 2013, the Fund entered into a $500 million secured, committed, margin facility (the “Facility”) with Merrill Lynch Professional Clearing Corp that has a 270-day rolling term that resets daily. Under the Facility, interest is charged on LIBOR Loans at an adjusted LIBOR rate and is payable on the last day of each interest period. For the year ended November 30, 2014, the interest rate on the Facility ranged from 0.95% to 0.97%. Under the terms of the Facility, the Fund is required to satisfy certain collateral requirements and maintain a certain level of net assets. At November 30, 2014, the principal balance outstanding under the Facility was $410 million. |
8 | Concentration of risk: Under normal market conditions, the Fund will concentrate in MLPs, many of which operate in the natural resources industry. The natural resources industry includes companies involved in: exploration and production, refining and marketing, coal and metals mining, oilfield service, drilling, integrated natural gas midstream services, transportation and storage, shipping, electricity generation, distribution, development, gathering, processing and renewable resources. The focus of the Fund’s portfolio on a specific group of largely interrelated sectors may present more risks than if its portfolio were broadly diversified over numerous industries and sectors of the economy. A downturn in the natural resources industry would have a larger impact on the Fund than on an investment company that does not concentrate in such industry. |
9 | Derivative instruments: During the year ended November 30, 2014, the Fund’s use of derivatives, as described below, was limited to written call option transactions. The Fund has adopted the provisions of ASC 815 “Derivatives and Hedging” (“ASC 815”). The disclosure requirements of ASC 815 distinguish between derivatives that qualify for hedge accounting and those that do not. Because investment companies value their derivatives at |
16
Written option contracts: Premiums received by the Fund upon writing a covered call option are recorded in the liability section of the Fund’s Statement of Assets and Liabilities and are subsequently adjusted to the current market value. When an option is exercised, closed, or expired, the Fund realizes a gain or loss and the liability is eliminated.
When writing a covered call option, the Fund, 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 covered call option that the Fund has written expires unexercised, the Fund will realize a gain in the amount of the premium. All securities covering outstanding written options are held in escrow by the custodian bank.
Written option transactions were used in an attempt to generate incremental income for the Fund for the year ended November 30, 2014. Written option transactions for the Fund for the year ended November 30, 2014 were:
Number of | Premium | ||||
Contracts | Received | ||||
Outstanding at 11/30/2013 | — | $— | |||
Options written | 17,484 | 1,060,174 | |||
Options expired | (2,400 | ) | (122,667 | ) | |
Options exercised | (15,084 | ) | (937,507 | ) | |
Options closed | — | — | |||
Outstanding at 11/30/2014 | — | $— |
The impact of the use of these derivative instruments on the Statement of Operations during the year ended November 30, 2014 was as follows:
Realized Gain (Loss) | Equity | Statement of | ||
Risk | Operations Location | |||
Option contracts written | $122,667 |
Net realized gain (loss) on:
|
||
Total Realized Gain (Loss) | $122,667 | option contracts written |
For the year ended November 30, 2014, the Fund had an average market value of $292,038 in written options.
10 | Indemnifications: Like many other companies, the Fund’s organizational documents provide that its officers (“Officers”) and directors (“Directors”) are indemnified against certain liabilities arising out of the performance of their duties to the Fund. In addition, both in some of its principal service contracts and in the normal course of its business, the Fund enters into contracts that provide indemnifications to other parties for certain types of losses or liabilities. The Fund’s maximum exposure under these arrangements is unknown as this could involve future claims against the Fund. |
The Fund retains Management as its investment manager under a Management Agreement. For such investment management services, the Fund pays Management a fee at the annual rate of 0.75% of its average weekly Managed Assets. Managed Assets equal the total assets of the Fund, less liabilities other than the aggregate indebtedness entered into for purposes of leverage.
The Fund retains Management as its administrator under an Administration Agreement. The Fund pays Management an administration fee at the annual rate of 0.25% of its average weekly Managed Assets under this agreement. Additionally, Management retains US Bancorp Fund Services, LLC (“USBFS”) as its sub-administrator under a Sub-Administration Agreement. Management pays USBFS a fee for all services received under the Sub-Administration Agreement.
17
During the year ended November 30, 2014, there were purchase and sale transactions of long-term securities (excluding written option contracts) of $184,032,906 and $163,328,103, respectively.
During the year ended November 30, 2014, no brokerage commissions on securities transactions were paid to affiliated brokers.
At November 30, 2014, the shares of common stock outstanding and the shares of common stock of the Fund owned by Neuberger were as follows:
Common Stock | Common Stock | |
Outstanding | Owned by Neuberger | |
56,523,532 | 5,707 |
Transactions in shares of common stock for the year ended November 30, 2014 and the period ended November 30, 2013 were as follows:
For the | For the | ||||
Year Ended | Period Ended | ||||
November 30, 2014 | November 30, 2013 | ||||
Initial Capitalization | — | 5,236 | |||
Initial Public Offerings | — | 56,503,828 | |||
Issued through Dividend Reinvestment | — | 14,468 | |||
Net Increase in Common Stock Outstanding | — | 56,523,532 |
Balance | Net Realized | ||||||||||||||||||
of | Distributions | Gain (Loss) | |||||||||||||||||
Shares | Gross | Balance of | from | from | |||||||||||||||
Held | Purchases | Gross | Shares Held | Value | Investments | Investments | |||||||||||||
November 30, | and | Sales and | November 30, | November 30, | in Affiliated | in Affiliated | |||||||||||||
2013 | Additions | Reductions | 2014 | 2014 | Issuers | Issuers | |||||||||||||
Southcross Energy | |||||||||||||||||||
Partners, L.P. | 760,000 | 1,100,068 | — | 1,860,068 | $32,439,586 | $1,942,954 | $— | ||||||||||||
Southcross Energy | |||||||||||||||||||
Partners, L.P. | |||||||||||||||||||
Series A, Preferred | 774,016 | 27,327 | (801,343 | ) | — | — | 945,184 | — | |||||||||||
Total | $32,439,586 | $2,888,138 | $— |
(1) Affiliated issuers, as defined in the 1940 Act.
18
MLP Income Fund Inc.
The following table includes selected data for a share of common stock outstanding throughout each period and other performance information derived from the Financial Statements. Per share amounts that round to less than $0.01 or $(0.01) per share are presented as $0.00 or $(0.00), respectively. Ratios that round to less than 0.00% or (0.00%) per share are presented as 0.00% or (0.00%), respectively. A “-” indicates that the line item was not applicable in the corresponding period.
Period from | |||||||||||
March 28, 2013* | |||||||||||
Year Ended | through | ||||||||||
November 30, 2014 | November 30, 2013 | ||||||||||
Common Stock Net Asset Value, Beginning of Period | $19.71 | $19.10 | |||||||||
Income From Investment Operations Applicable to Common Stockholders: | |||||||||||
Net Investment Income (Loss)¢ | 0.33 | (0.06 | ) | ||||||||
Net Gains or Losses on Securities (both realized and unrealized) | 1.90 | 1.45 | |||||||||
Total From Investment Operations Applicable to Common Stockholders | 2.23 | 1.39 | |||||||||
Less Distributions to Common Stockholders From: | |||||||||||
Net Investment Income | — | — | |||||||||
Tax Return of Capital | (1.26 | ) | (0.74 | ) | |||||||
Total Distributions to Common Stockholders | (1.26 | ) | (0.74 | ) | |||||||
Less Capital Charges: | |||||||||||
Issuance of Common Stock | — | (0.04 | ) | ||||||||
Common Stock Net Asset Value, End of Period | $20.68 | $19.71 | |||||||||
Common Stock Market Value, End of Period | $18.99 | $18.18 | |||||||||
Total Return, Common Stock Net Asset Value† | 11.89 | % | 7.27 | %@@ | |||||||
Total Return, Common Stock Market Value† | 11.39 | % | (5.51 | )%@@ | |||||||
Supplemental Data/Ratios | |||||||||||
Net Assets Applicable to Common Stockholders, End of Period (in millions) | $1,168.8 | $1,114.0 | |||||||||
Ratios are Calculated Using Average Net Assets | |||||||||||
Applicable to Common Stockholders | |||||||||||
Ratio of Expenses Including Deferred Income Tax Expense# | 7.81 | % | 5.65 | %@ | |||||||
Ratio of Expenses Excluding Deferred Income Tax Expense | 1.77 | % | 1.43 | %@ | |||||||
Ratio of Net Investment Income (Loss) Including Deferred Income Tax Expense# | (7.24 | )% | (5.09 | )%@ | |||||||
Ratio of Net Investment Income (Loss) Excluding Deferred Income Tax Expense | (1.20 | )% | (0.87 | )%@ | |||||||
Portfolio Turnover Rate | 10 | % | 0 | %@@ | |||||||
Loans Payable (in millions) | $410 | $405 | |||||||||
Asset Coverage Per $1,000 of Loans PayableØ | $3,851 | $3,751 |
See Notes to Financial Highlights | 19 |
* | Commencement of operations. |
† | Total return based on per share NAV reflects the effects of changes in NAV on the performance of the Fund during each fiscal period. Total return based on per share market value assumes the purchase of shares at the market price on the first day and sale of shares at the market price on the last day of the period indicated. Dividends and distributions, if any, are assumed to be reinvested at prices obtained under the Fund’s distribution reinvestment plan. Results represent past performance and do not indicate future results. Current returns may be lower or higher than the performance data quoted. Investment returns may fluctuate and shares when sold may be worth more or less than original cost. |
# | For the year ended November 30, 2014, and the period from March 28, 2013 through November 30, 2013, the Fund accrued $72,009,636 and $45,339,195, respectively, for net deferred income tax expense, which is included in these ratios on a non-annualized basis. |
¢ | Calculated based on the average number of shares outstanding during each fiscal period. |
@ | Annualized. |
@@ | Not annualized. |
Ø | Calculated by subtracting the Fund’s total liabilities (excluding loans payable and accumulated unpaid interest on loans payable) from the Fund’s total assets and dividing by the outstanding loans payable balance. |
20
To the Board of Directors and Stockholders of
Neuberger Berman MLP Income Fund Inc.
We have audited the accompanying statement of assets and liabilities of Neuberger Berman MLP Income Fund Inc., (the “Fund”), including the schedule of investments, as of November 30, 2014, and the related statements of operations and cash flows for the year then ended, the statements of changes in net assets and the financial highlights for the each of the periods indicated therein. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of November 30, 2014 by correspondence with the custodian and others or by other appropriate auditing procedures where replies from others were not received. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Neuberger Berman MLP Income Fund Inc. at November 30, 2014, the results of its operations and cash flows for the year then ended, the changes in its net assets and the financial highlights for each of the periods indicated therein, in conformity with U.S. generally accepted accounting principles.
Boston, Massachusetts
January 20, 2015
21
Computershare, Inc. (the “Plan Agent”) will act as Plan Agent for stockholders who have not elected in writing to receive dividends and other distributions in cash (each a “Participant”), will open an account for each Participant under the Distribution Reinvestment Plan (“Plan”) in the same name as its then-current shares of the Fund’s common stock (“Shares”) are registered, and will put the Plan into effect for each Participant as of the first record date for a dividend or other distribution after the account is opened.
Whenever the Fund declares a dividend or distribution with respect to the Shares, each Participant will receive such dividends and other distributions in additional Shares, including fractional Shares acquired by the Plan Agent and credited to each Participant’s account. If on the payment date for a cash dividend or distribution, the net asset value is equal to or less than the market price per Share plus estimated brokerage commissions, the Plan Agent shall automatically receive such Shares, including fractions, for each Participant’s account. Except in the circumstances described in the next paragraph, the number of additional Shares to be credited to each Participant’s account shall be determined by dividing the dollar amount of the dividend or distribution payable on its Shares by the greater of the net asset value per Share determined as of the date of purchase or 95% of the then-current market price per Share on the payment date.
Should the net asset value per Share exceed the market price per Share plus estimated brokerage commissions on the payment date for a cash dividend or distribution, the Fund may, but is not required to, issue new Shares. If the Fund does not issue new Shares, and the net asset value per Share exceeds the market price per Share plus estimated brokerage commissions on the payment date for a cash dividend or distribution, then the Plan Agent, or a broker-dealer selected by the Plan Agent, shall endeavor, for a purchase period lasting until the last business day before the next date on which the Shares trade on an “ex-distribution” basis, but in no event, except as provided below, more than 30 days after the payment date, to apply the amount of such dividend or distribution on each Participant’s Shares (less their pro rata share of brokerage commissions incurred with respect to the Plan Agent’s open-market purchases in connection with the reinvestment of such dividend or distribution) to purchase Shares on the open market for each Participant’s account. No such purchases may be made more than 30 days after the payment date for such dividend or distribution except where temporary curtailment or suspension of purchase is necessary to comply with applicable provisions of federal securities laws. If, at the close of business on any day during the purchase period the net asset value per Share equals or is less than the market price per Share plus estimated brokerage commissions, the Plan Agent will not make any further open-market purchases in connection with the reinvestment of such dividend or distribution. If the Plan Agent is unable to invest the full dividend or distribution amount through open-market purchases during the purchase period, the Plan Agent shall request that, with respect to the uninvested portion of such dividend or distribution amount, the Fund issue new Shares at the close of business on the earlier of the last day of the purchase period or the first day during the purchase period on which the net asset value per Share equals or is less than the market price per Share, plus estimated brokerage commissions, such Shares to be issued in accordance with the terms specified in the third paragraph hereof. These newly issued Shares will be valued at the then-current market price per Share at the time such Shares are to be issued.
For purposes of making the reinvestment purchase comparison under the Plan, (a) the market price of the Shares on a particular date shall be the last sales price on the New York Stock Exchange (or if the Shares are not listed on the New York Stock Exchange, such other exchange on which the Shares are principally traded) on that date, or, if there is no sale on such Exchange (or if not so listed, in the over-the-counter market) on that date, then the mean between the closing bid and asked quotations for such Shares on such Exchange on such date and (b) the net asset value per Share on a particular date shall be the net asset value per Share most recently calculated by or on behalf of the Fund. All dividends, distributions and other payments (whether made in cash or Shares) shall be made net of any applicable withholding tax.
22
The Plan Agent may hold each Participant’s Shares acquired pursuant to the Plan together with the Shares of other stockholders of the Fund acquired pursuant to the Plan in noncertificated form in the Plan Agent’s name or that of the Plan Agent’s nominee. The Plan Agent will forward to each Participant any proxy solicitation material and will vote any Shares so held for each Participant only in accordance with the instructions set forth on proxies returned by the Participant to the Fund.
The Plan Agent will confirm to each Participant each acquisition made for its account as soon as practicable but not later than 60 days after the date thereof. Although each Participant may from time to time have an undivided fractional interest (computed to three decimal places) in a Share, no certificates for a fractional Share will be issued. However, dividends and distributions on fractional Shares will be credited to each Participant’s account. In the event of termination of a Participant’s account under the Plan, the Plan Agent will adjust for any such undivided fractional interest in cash at the market value of the Shares at the time of termination, less the pro rata expense of any sale required to make such an adjustment.
Any Share dividends or split Shares distributed by the Fund on Shares held by the Plan Agent for Participants will be credited to their accounts. In the event that the Fund makes available to its stockholders rights to purchase additional Shares or other securities, the Shares held for each Participant under the Plan will be added to other Shares held by the Participant in calculating the number of rights to be issued to each Participant.
The Plan Agent’s service fee for handling capital gains and other distributions or income dividends will be paid by the Fund. Participants will be charged their pro rata share of brokerage commissions on all open-market purchases.
Each Participant may terminate its account under the Plan by notifying the Plan Agent in writing. Such termination will be effective immediately if the Participant’s notice is received by the Plan Agent not less than ten days prior to any dividend or distribution record date, otherwise such termination will be effective the first trading day after the payment date for such dividend or distribution with respect to any subsequent dividend or distribution. The Plan may be terminated by the Plan Agent or the Fund upon notice in writing mailed to each Participant at least 30 days prior to any record date for the payment of any dividend or distribution by the Fund.
These terms and conditions may be amended or supplemented by the Plan Agent or the Fund at any time or times but, except when necessary or appropriate to comply with applicable law or the rules or policies of the Securities and Exchange Commission or any other regulatory authority, only by mailing to each Participant appropriate written notice at least 30 days prior to the effective date thereof. The amendment or supplement shall be deemed to be accepted by each Participant unless, prior to the effective date thereof, the Plan Agent receives written notice of the termination of its account under the Plan. Any such amendment may include an appointment by the Plan Agent in its place and stead of a successor Plan Agent under these terms and conditions, with full power and authority to perform all or any of the acts to be performed by the Plan Agent under these terms and conditions. Upon any such appointment of any Plan Agent for the purpose of receiving dividends and other distributions, the Fund will be authorized to pay to such successor Plan Agent, for each Participant’s account, all dividends and other distributions payable on Shares held in its name or under the Plan for retention or application by such successor Plan Agent as provided in these terms and conditions.
23
Reinvested dividends and distributions are taxed in the same manner as cash dividends and distributions — i.e., reinvestment in additional Shares does not relieve stockholders of, or defer the need to pay, any income tax that may be payable (or that is required to be withheld) on Fund dividends and distributions. Participants should contact their tax professionals for information on how the Plan impacts their personal tax situation. For additional information about the Plan, please contact the Plan Agent at 1-866-227-2136 or P.O. Box 30170, College Station, TX 77842-3170.
24
Investment Manager and Administrator Sub-Adviser Custodian |
Stock Transfer Agent Plan Agent Overnight correspondence should be sent to: Legal Counsel Independent Registered Public Accounting Firm |
25
The following tables set forth information concerning the Directors and Officers of the Fund. All persons named as Directors and Officers also serve in similar capacities for other funds administered or managed by Management and Neuberger. The Fund’s Statement of Additional Information includes additional information about the Directors as of the time of the Fund’s most recent public offering and is available upon request, without charge, by calling (800) 877-9700.
Name, (Year of Birth), | Position(s) | Principal Occupation(s)(3) | Number of | Other Directorships Held | ||||
and Address(1) | and Length of | Funds in | Outside Fund Complex | |||||
Time Served(2) | Fund Complex | by Director(3) | ||||||
Overseen by | ||||||||
Director | ||||||||
CLASS I |
||||||||
Independent Directors |
||||||||
Michael M. Knetter (1960) |
Director since |
President and Chief Executive Officer, University of Wisconsin Foundation, since October 2010; formerly, Dean, School of Business, University of Wisconsin - Madison; formerly, Professor of International Economics and Associate Dean, Amos Tuck School of Business - Dartmouth College, 1998 to 2002. |
59 |
Board Member, American Family Insurance (a mutual company, not publicly traded), since March 2009; formerly, Trustee, Northwestern Mutual Series Fund, Inc., 2007 to 2011; formerly, Director, Wausau Paper, 2005 to 2011; formerly, Director, Great Wolf Resorts, 2004 to 2009. |
||||
Peter P. Trapp (1944) |
Director since |
Retired; formerly, Regional Manager for Mid-Southern Region, Ford Motor Credit Company, 1997 to 2007; formerly, President, Ford Life Insurance Company, 1995 to 1997. |
59 |
None. |
26
Name, (Year of Birth), | Position(s) | Principal Occupation(s)(3) | Number of | Other Directorships Held | ||||
and Address(1) | and Length of | Funds in | Outside Fund Complex | |||||
Time Served(2) | Fund Complex | by Director(3) | ||||||
Overseen by | ||||||||
Director | ||||||||
Director who is an “Interested Person” |
||||||||
Robert Conti* (1956) |
Chief Executive |
Managing Director, Neuberger, since 2007; Managing Director, Neuberger Berman Fixed Income LLC (“NBFI”), since 2009; President and Chief Executive Officer, Management, since 2008; formerly, Senior Vice President, Neuberger, 2003 to 2006; formerly, Vice President, Neuberger, 1999 to 2003; formerly, Senior Vice President, Management, 2000 to 2008. |
59 |
Director, Staten Island Mental Health Society, since 1994; formerly, Chairman of the Board, Staten Island Mental Health Society, 2008 to 2011. |
||||
CLASS II |
||||||||
Independent Directors |
||||||||
Faith Colish (1935) |
Director since |
Counsel, Carter Ledyard & Milburn LLP (law firm) since 2002; formerly, Attorney-at-Law and President, Faith Colish, A Professional Corporation, 1980 to 2002. |
59 |
Formerly, Director, 1997 to 2003, and Advisory Director, 2003 to 2006, ABA Retirement Funds (formerly, American Bar Retirement Association) (not-for-profit membership corporation). |
||||
George W. Morriss (1947) |
Director since |
Adjunct Professor, Columbia University School of International and Public Affairs, since 2012; formerly, Executive Vice President and Chief Financial Officer, People’s Bank, Connecticut (a financial services company), 1991 to 2001. |
59 |
Director and Treasurer, National Association of Corporate Directors, Connecticut Chapter, since 2011; Trustee, Steben Alternative Investment Funds, Steben Select Multi-Strategy Fund and Steben Select Multi-Strategy Master Fund, since 2013; formerly, Manager, Larch Lane Multi-Strategy Fund complex (which consisted of three funds), 2006 to 2011; formerly, Member, NASDAQ Issuers’ Affairs Committee, 1995 to 2003. |
27
Name, (Year of Birth), | Position(s) | Principal Occupation(s)(3) | Number of | Other Directorships Held | ||||
and Address(1) | and Length of | Funds in | Outside Fund Complex | |||||
Time Served(2) | Fund Complex | by Director(3) | ||||||
Overseen by | ||||||||
Director | ||||||||
Tom D. Seip (1950) |
Director |
General Partner, Ridgefield Farm LLC (a private investment vehicle); formerly, President and CEO, Westaff, Inc. (temporary staffing), 2001 to 2002; formerly, Senior Executive, The Charles Schwab Corporation, 1983 to 1998, including Chief Executive Officer, Charles Schwab Investment Management, Inc.; Trustee, Schwab Family of Funds and Schwab Investments, 1997 to 1998; and Executive Vice President-Retail Brokerage, Charles Schwab & Co., Inc., 1994 to 1997. |
59 |
Director, H&R Block, Inc. (financial services company), since 2001; Chairman, Governance and Nominating Committee, H&R Block, Inc., since 2011; formerly, Chairman, Compensation Committee, H&R Block, Inc., 2006 to 2010; formerly, Director, Forward Management, Inc. (asset management company), 1999 to 2006. |
28
Name, (Year of Birth), | Position(s) | Principal Occupation(s)(3) | Number of | Other Directorships Held | ||||
and Address(1) | and Length of | Funds in | Outside Fund Complex | |||||
Time Served(2) | Fund Complex | by Director(3) | ||||||
Overseen by | ||||||||
Director | ||||||||
CLASS III | ||||||||
Independent Directors | ||||||||
Martha C. Goss (1949) |
Director since |
President, Woodhill Enterprises Inc./Chase Hollow Associates LLC (personal investment vehicle), since 2006; formerly, Consultant, Resources Global Professionals (temporary staffing), 2002 to 2006. |
59 |
Director, American Water (water utility), since 2003; Director, Allianz Life of New York (insurance), since 2005; Director, Berger Group Holdings, Inc. (engineering consulting firm), since 2013; Director, Financial Women’s Association of New York (not-for-profit association), since 2003; Trustee Emerita, Brown University, since 1998; Director, Museum of American Finance (not-for-profit), since 2013; formerly, Non-Executive Chair and Director, Channel Reinsurance (financial guaranty reinsurance), 2006 to 2010; formerly, Director, Ocwen Financial Corporation (mortgage servicing), 2005 to 2010; formerly, Director, Claire’s Stores, Inc. (retailer), 2005 to 2007; formerly, Director, Parsons Brinckerhoff Inc. (engineering consulting firm), 2007 to 2010; formerly, Director, Bank Leumi (commercial bank), 2005 to 2007; formerly, Advisory Board Member, Attensity (software developer), 2005 to 2007. |
29
Name, (Year of Birth), | Position(s) | Principal Occupation(s)(3) | Number of | Other Directorships Held | ||||
and Address(1) | and Length of | Funds in | Outside Fund Complex | |||||
Time Served(2) | Fund Complex | by Director(3) | ||||||
Overseen by | ||||||||
Director | ||||||||
Howard A. Mileaf (1937) |
Director since |
Retired; formerly, Vice President and General Counsel, WHX Corporation (holding company), 1993 to 2001. |
59 |
Formerly, Director, Webfinancial Corporation (holding company), 2002 to 2008; formerly, Director, WHX Corporation (holding company), 2002 to 2005; formerly, Director, State Theatre of New Jersey (not-for-profit theatre), 2000 to 2005. |
||||
Candace L. Straight (1947) |
Director since |
Private investor and consultant specializing in the insurance industry; formerly, Advisory Director, Securitas Capital LLC (a global private equity investment firm dedicated to making investments in the insurance sector), 1998 to 2003. |
59 |
Public Member, Board of Governors and Board of Trustees, Rutgers University, since 2011; Director, Montpelier Re Holdings Ltd. (reinsurance company), since 2006; formerly, Director, National Atlantic Holdings Corporation (property and casualty insurance company), 2004 to 2008; formerly, Director, The Proformance Insurance Company (property and casualty insurance company), 2004 to 2008; formerly, Director, Providence Washington Insurance Company (property and casualty insurance company), 1998 to 2006; formerly, Director, Summit Global Partners (insurance brokerage firm), 2000 to 2005. |
30
Name, (Year of Birth), | Position(s) | Principal Occupation(s)(3) | Number of | Other Directorships Held | ||||
and Address(1) | and Length of | Funds in | Outside Fund Complex | |||||
Time Served(2) | Fund Complex | by Director(3) | ||||||
Overseen by | ||||||||
Director | ||||||||
Director who is an “Interested Person” |
||||||||
Joseph V. Amato* (1962) |
Director since |
President and Director, Neuberger Berman Group LLC, since 2009; President and Chief Executive Officer, Neuberger and Neuberger Berman Holdings LLC (including its predecessor, Neuberger Berman Inc.), since 2007; Chief Investment Officer (Equities) and Managing Director, Management, since 2009; Managing Director, NBFI, since 2007; Board member of NBFI since 2006; formerly, Global Head of Asset Management of Lehman Brothers Holdings Inc.’s (“LBHI”) Investment Management Division, 2006 to 2009; formerly, member of LBHI’s Investment Management Division’s Executive Management Committee, 2006 to 2009; formerly, Managing Director, Lehman Brothers Inc. (“LBI”), 2006 to 2008; formerly, Chief Recruiting and Development Officer, LBI, 2005 to 2006; formerly, Global Head of LBI’s Equity Sales and a Member of its Equities Division Executive Committee, 2003 to 2005. |
59 |
Member of Board of Advisors, McDonough School of Business, Georgetown University, since 2001; Member of New York City Board of Advisors, Teach for America, since 2005; Trustee, Montclair Kimberley Academy (private school), since 2007; Member of Board of Regents, Georgetown University, since 2013. |
(1) | The business address of each listed person is 605 Third Avenue, New York, New York 10158. | |
(2) | The Board shall at all times be divided as equally as possible into three classes of Directors designated Class I, Class II and Class III. The terms of office of Class I, Class II and Class III Directors shall expire at the annual meeting of stockholders held in 2015, 2016 and 2017, respectively, and at each third annual meeting of stockholders thereafter. | |
(3) | Except as otherwise indicated, each individual has held the positions shown for at least the last five years. | |
* | Indicates a Director who is an “interested person” within the meaning of the Investment Company Act of 1940, as amended (the “1940 Act”). Joseph Amato and Robert Conti are interested persons of each Fund by virtue of the fact that each is an officer of Management, Neuberger and/or their affiliates. |
31
Name, (Year of Birth), | Position(s) | Principal Occupation(s)(2) | ||
and Address(1) | and Length of | |||
Time Served | ||||
Andrew B. Allard (1961) |
Chief Legal Officer since 2013 (only for purposes of sections 307 and 406 of the Sarbanes-Oxley Act of 2002) and Anti-Money Laundering Compliance Officer since 2013 |
General Counsel and Senior Vice President, Management since 2013; Senior Vice President, Neuberger, since 2006 and Employee since 1999; Deputy General Counsel, Neuberger, since 2004; formerly, Vice President, Neuberger, 2000 to 2005; formerly, Employee, Management, 1994 to 1999; Chief Legal Officer since 2013 (only for purposes of sections 307 and 406 of the Sarbanes-Oxley Act of 2002), ten registered investment companies for which Management acts as investment manager and administrator (ten since 2013); Anti-Money Laundering Compliance Officer, ten registered investment companies for which Management acts as investment manager and administrator (six since 2002, one since 2003, one since 2005, one since 2006 and one since 2013). |
||
Claudia A. Brandon (1956) |
Executive Vice President and Secretary since 2013 |
Senior Vice President, Neuberger, since 2007 and Employee since 1999; Senior Vice President, Management, since 2008 and Assistant Secretary since 2004; formerly, Vice President, Neuberger, 2002 to 2006; formerly, Vice President-Mutual Fund Board Relations, Management, 2000 to 2008; formerly, Vice President, Management, 1986 to 1999 and Employee 1984 to 1999; Executive Vice President, ten registered investment companies for which Management acts as investment manager and administrator (nine since 2008 and one since 2013); Secretary, ten registered investment companies for which Management acts as investment manager and administrator (three since 1985, three since 2002, one since 2003, one since 2005, one since 2006 and one since 2013). |
||
Agnes Diaz (1971) |
Vice President since 2013 |
Senior Vice President, Neuberger, since 2012; Employee, Management, since 1996; formerly, Vice President, Neuberger, 2007 to 2012; Vice President, ten registered investment companies for which Management acts as investment manager and administrator (ten since 2013). |
||
Anthony DiBernardo (1979) |
Assistant Treasurer since 2013 |
Senior Vice President, Neuberger, since 2014; Employee, Management, since 2003; formerly, Vice President, Neuberger, 2009 to 2014; Assistant Treasurer, ten registered investment companies for which Management acts as investment manager and administrator (nine since 2011 and one since 2013). |
||
Sheila R. James (1965) |
Assistant Secretary since 2013 |
Vice President, Neuberger, since 2008 and Employee since 1999; formerly, Assistant Vice President, Neuberger, 2007; formerly, Employee, Management, 1991 to 1999; Assistant Secretary, ten registered investment companies for which Management acts as investment manager and administrator (six since 2002, one since 2003, one since 2005, one since 2006 and one since 2013). |
32
Name, (Year of Birth), | Position(s) | Principal Occupation(s)(2) | ||
and Address(1) | and Length of | |||
Time Served | ||||
Brian Kerrane (1969) |
Vice President since 2013 |
Managing Director, Neuberger, since 2014; Vice President, Management, since 2008 and Employee since 1991; formerly, Senior Vice President, Neuberger, 2006 to 2014; Vice President, ten registered investment companies for which Management acts as investment manager and administrator (nine since 2008 and one since 2013). |
||
Kevin Lyons (1955) |
Assistant Secretary since 2013 |
Assistant Vice President, Neuberger, since 2008 and Employee since 1999; formerly, Employee, Management, 1993 to 1999; Assistant Secretary, ten registered investment companies for which Management acts as investment manager and administrator (seven since 2003, one since 2005, one since 2006 and one since 2013). |
||
Owen F. McEntee, Jr. (1961) |
Vice President since 2013 |
Vice President, Neuberger, since 2006; Employee, Management, since 1992; Vice President, ten registered investment companies for which Management acts as investment manager and administrator (nine since 2008 and one since 2013). |
||
John M. McGovern (1970) |
Treasurer and Principal Financial and Accounting Officer since 2013 |
Senior Vice President, Neuberger, since 2007; Employee, Management, since 1993; Treasurer and Principal Financial and Accounting Officer, ten registered investment companies for which Management acts as investment manager and administrator (eight since 2005, one since 2006 and one since 2013); formerly, Vice President, Neuberger, 2004 to 2006; formerly, Assistant Treasurer, eight registered investment companies for which Management acts as investment manager and administrator, 2002 to 2005. |
||
Frank Rosato (1971) |
Assistant Treasurer since 2013 |
Vice President, Neuberger, since 2006; Employee, Management, since 1995; Assistant Treasurer, ten registered investment companies for which Management acts as investment manager and administrator (eight since 2005, one since 2006 and one since 2013). |
||
Neil S. Siegel (1967) |
Vice President since 2013 |
Managing Director, Management, since 2008; Managing Director, Neuberger, since 2006; Managing Director, NBFI, since 2011; formerly, Senior Vice President, Neuberger, 2004 to 2006; Vice President, ten registered investment companies for which Management acts as investment manager and administrator (nine since 2008 and one since 2013). |
||
Chamaine Williams (1971) |
Chief Compliance Officer since 2013 |
Senior Vice President, Neuberger, since 2007; Chief Compliance Officer, Management, since 2006; Chief Compliance Officer, ten registered investment companies for which Management acts as investment manager and administrator (eight since 2005, one since 2006 and one since 2013); formerly, Senior Vice President, LBI, 2007 to 2008; formerly, Vice President, LBI, 2003 to 2006; formerly, Chief Compliance Officer, Lehman Brothers Asset Management Inc., 2003 to 2007; formerly, Chief Compliance Officer, Lehman Brothers Alternative Investment Management LLC, 2003 to 2007. |
(1) | The business address of each listed person is 605 Third Avenue, New York, New York 10158. | |
(2) | Except as otherwise indicated, each individual has held the positions shown for at least the last five years. |
33
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available, without charge, by calling 800-877-9700 (toll-free) and on the Securities and Exchange Commission’s website, at www.sec.gov. Information regarding how the Fund voted proxies relating to portfolio securities during the most recent period ended June 30 is also available, without charge, by calling 800-877-9700 (toll-free), on the Securities and Exchange Commission’s website at www.sec.gov, and on Management’s website at www.nb.com.
The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the Securities and Exchange Commission’s website at www.sec.gov and, may be reviewed and copied at the Securities and Exchange Commission’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 800-SEC-0330. The information on Form N-Q is available upon request, without charge, by calling 800-877-9700 (toll-free).
34
An annual meeting of stockholders was held on September 17, 2014. Common stockholders voted to elect four Class III Directors to serve until the annual meeting of stockholders in 2017, or until their successors are elected and qualified, and one Class II Director to serve until the annual meeting of stockholders in 2016, or until her successor is elected and qualified. Class I Directors (which include Michael M. Knetter, Peter P. Trapp, and Robert Conti) and the other Class II Directors (which include George W. Morriss and Tom D. Seip) continue to hold office until the annual meeting in 2015 and 2016, respectively.
To elect four Class III Directors to serve until the annual meeting of stockholders in 2017, or until their successors are elected and qualified.
Shares of Common Stock
Votes | Broker | |||||||
Votes For | Withheld | Abstentions | Non-Votes | |||||
Candace L. Straight | 49,147,217 | 457,769 | — | — | ||||
Martha C. Goss | 49,166,480 | 438,506 | — | — | ||||
Joseph V. Amato | 49,154,699 | 450,286 | — | — | ||||
Howard A. Mileaf | 49,117,684 | 487,302 | — | — |
To elect one Class II Director to serve until the annual meeting of stockholders in 2016, or until her successor is elected and qualified.
Shares of Common Stock
Votes | Broker | |||||||
Votes For | Withheld | Abstentions | Non-Votes | |||||
Faith Colish | 49,117,984 | 487,002 | — | — |
35
On an annual basis, the Board of Directors (“Board”) of Neuberger Berman MLP Income Fund Inc. (the “Fund”), including the Directors who are not “interested persons” of Neuberger Berman Management LLC (“Management”) (including its affiliates) or the Fund (“Independent Fund Directors”), considers whether to continue the Management and Sub-Advisory Agreements (“Agreements”) with respect to the Fund. At a meeting held on October 6-7, 2014, the Board, including the Independent Fund Directors, approved the continuation of the Agreements.
In evaluating the Agreements, the Board, including the Independent Fund Directors, reviewed extensive materials provided by Management and Neuberger Berman LLC (“Neuberger”) in response to questions submitted by the Board and counsel for the Independent Fund Directors, and met with senior representatives of Management regarding its personnel, operations and financial condition as they relate to the Fund. The annual contract review extends over at least two regular meetings of the Board to ensure that Management and Neuberger have time to respond to any questions the Independent Fund Directors may have on their initial review of the materials and that the Independent Fund Directors have time to consider those responses.
In connection with its deliberations, the Board also considered the broad range of information relevant to the annual contract review that is provided to the Board (including its various standing committees) at meetings throughout the year, including investment performance reports and related portfolio information for the Fund, as well as periodic reports on, among other matters, pricing and valuation; brokerage and execution; and compliance and other services provided by Management, Neuberger and their affiliates. To assist the Board in its deliberations regarding the annual contract review, the Board has established a Contract Review Committee comprised of Independent Fund Directors, as well as other committees that focus throughout the year on specific areas relevant to the annual contract review, such as Fund performance or compliance matters.
Throughout the process, the Independent Fund Directors were advised by counsel that is experienced in Investment Company Act of 1940 matters and that is independent of Management. The Independent Fund Directors received from independent counsel a memorandum discussing the legal standards for their consideration of the proposed continuation of the Agreements. During the course of the year and during their deliberations regarding the annual contract review, the Contract Review Committee and the Independent Fund Directors met with such counsel separately from representatives of Management and Neuberger.
In connection with its approval of the continuation of the Agreements, the Board evaluated the terms of the Agreements, the overall fairness of the Agreements to the Fund and whether the Agreements were in the best interests of the Fund and its stockholders. The Board considered all factors it deemed relevant with respect to the Fund, including the following factors: (1) the nature, extent, and quality of the services provided by Management and Neuberger; (2) the investment performance of the Fund compared to appropriate market indices and a peer group of investment companies; (3) the costs of the services provided and the profit realized by Management and its affiliates from their relationship with the Fund; (4) the extent to which economies of scale might be realized as the Fund grows; and (5) whether fee levels reflect any such potential economies of scale for the benefit of investors in the Fund. While each Director may have attributed different weights to the various factors, the Board’s determination to approve the continuation of the Agreements was based on a comprehensive consideration of all information provided to the Board throughout the year and specifically in connection with the annual contract review. The Board members did not identify any particular information or factor that was all-important or controlling. The Board focused on the overall costs and benefits of the Agreements relating to the Fund and, through the Fund, its stockholders.
With respect to the nature, extent and quality of the services provided, the Board considered the investment philosophy and decision-making processes of Management and Neuberger, and the qualifications, experience and capabilities of and the resources available to the portfolio management personnel of Management and Neuberger who perform services for the Fund.
36
With respect to investment performance, the Board considered information regarding the Fund’s performance on both a market return and net asset value basis relative to its benchmark and the average performance of a composite peer group of closed-end investment companies (as constructed by an independent organization) pursuing broadly similar strategies. The Board also reviewed performance in relation to certain measures of the degree of investment risk undertaken by portfolio managers. The Board factored into its evaluation of the Fund’s performance the limitations inherent in the methodology for constructing peer groups and determining which investment companies should be included in which peer groups. The Board noted that performance, especially short-term performance, is only one of the factors that it deems relevant to its consideration of the Fund’s Agreements.
With respect to the overall fairness of the Agreements, the Board considered the fee structure for the Fund under the Agreements as compared to a peer group of comparable funds and any fall-out benefits likely to accrue to Management or Neuberger or their affiliates from their relationship with the Fund. In addition, the Board considered any fall-out benefits likely to accrue to Management or Neuberger or their affiliates from their relationship with the Fund. The Board also considered the profitability of Management and its affiliates from their association with the Fund, profitability broken out between the investment management and administrative portions of the services provided, and year-over-year changes in each of Management’s reported expense categories.
The Board reviewed a comparison of the Fund’s management fee and overall expense ratio to a peer group of broadly comparable funds. The Board noted that the comparative management fee analysis includes, in the Fund’s management fee, the separate administrative fee paid to Management, but it was not clear whether administrative services were included in the management fees for all funds in the peer group. The Board considered the mean and median of the management fees and expense ratios for the peer group. With regard to the sub-advisory fee paid to Neuberger, the Board noted that this fee is “at cost.” The Board noted that the Fund’s management fee was lower than the peer group mean and median.
The Board considered whether there were other funds or separate accounts that were advised or sub-advised by Management or Neuberger or their affiliates with investment objectives, policies and strategies that were similar to those of the Fund. The Board compared the fees charged to the Fund to the fees charged to separate accounts managed in similar styles to the Fund. The Board considered the appropriateness and reasonableness of any differences between the fees charged to the Fund and the accounts and determined that any differences in fees or fee structures were consistent with the management and other services provided.
The Board also evaluated any apparent or anticipated economies of scale in relation to the services Management provides to the Fund. The Board considered that the Fund is a closed-end fund that is not continuously offering shares and that, without daily inflows and outflows of capital, there are limited opportunities for significant economies of scale to be realized by Management in managing the Fund’s assets.
37
In approving the Agreements, the Board concluded that the terms of each Agreement are fair and reasonable to the Fund and that approval of the Agreements is in the best interests of the Fund and its stockholders. In reaching this determination, the Board considered that Management and Neuberger could be expected to provide a high level of service to the Fund; that the performance of the Fund was satisfactory over time; that the Fund’s fee structure appeared to the Board to be reasonable given the nature, extent and quality of services provided; and that the benefits accruing to Management and its affiliates by virtue of their relationship with the Fund were reasonable in light of the costs of providing the investment advisory and other services and benefits accruing to the Fund. The Board’s conclusions may be based in part on its consideration of materials prepared in connection with the Agreements in prior years and on the Board’s ongoing regular review of Fund performance and operations throughout the year, in addition to material prepared specifically for the most recent annual review of the Agreements.
38
Neuberger Berman Management LLC Statistics and projections in this report are derived from sources deemed to be reliable but cannot be regarded as a representation of future results of the Fund. This report is prepared for the general information of stockholders and is not an offer of shares of the Fund. N0372 01/15
|
||||
Type of Account
|
Number of
Accounts
Managed
|
Total Assets
Managed
($ millions)
|
Number of Accounts
Managed for which
Advisory Fee is
Performance-Based
|
Assets Managed for
which Advisory Fee is
Performance-Based
($ millions)
|
Douglas A. Rachlin
|
||||
Registered Investment
Companies*
|
0
|
N/A
|
0
|
N/A
|
Other Pooled Investment
Vehicles***
|
3
|
$1,808
|
0
|
N/A
|
Other Accounts**, ***
|
2,986
|
$5,343
|
0
|
N/A
|
Yves C. Siegel
|
||||
Registered Investment Companies*
|
0
|
N/A
|
0
|
N/A
|
Other Pooled Investment
Vehicles***
|
3
|
$1,808
|
0
|
N/A
|
Other Accounts**, ***
|
2,974
|
$5,333
|
0
|
N/A
|
Portfolio Manager
|
Dollar Range of Equity
Securities Owned in the
Registrant
|
Douglas A. Rachlin
|
E
|
Yves C. Siegel
|
D
|
A = None
|
E = $100,001-$500,000
|
B = $1-$10,000
|
F = $500,001-$1,000,000
|
C = $10,001 - $50,000
|
G = Over $1,000,000
|
D =$50,001-$100,000
|
(a) | Based on an evaluation of the disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “Act”)) as of a date within 90 days of the filing date of this document, the Chief Executive Officer and Treasurer and Principal Financial and Accounting Officer of the Registrant have concluded that such disclosure controls and procedures are effectively designed to ensure that information required to be disclosed by the Registrant on Form N-CSR and Form N-Q is accumulated and communicated to the Registrant’s management to allow timely decisions regarding required disclosure. |
(b) | There were no significant changes in the Registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the Registrant’s second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting. |
(a)(1) | A copy of the Code of Ethics is incorporated by reference to Neuberger Berman Equity Funds’ Form N-CSR, Investment Company Act file number 811-00582 (filed on May 6, 2013). |
(a)(2) | The certifications required by Rule 30a-2(a) of the Act and Section 302 of the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley Act”) are filed herewith. |
(a)(3) | Not applicable to the Registrant. |
(b) | The certifications required by Rule 30a-2(b) of the Act and Section 906 of the Sarbanes-Oxley Act are filed herewith. |
By:
|
/s/ Robert Conti
Robert Conti
Chief Executive Officer
|
By:
|
/s/ Robert Conti
Robert Conti
Chief Executive Officer
|
By:
|
/s/ John M. McGovern
John M. McGovern
Treasurer and Principal Financial
and Accounting Officer
|