SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

Filed by the Registrant                     [X]

Filed by a Party other than the Registrant  [ ]

Check the appropriate box:

[X]   Preliminary Proxy Statement
[ ]   Confidential, for Use of the Commission Only (as permitted by
      Rule 14a-6(e)(2))
[ ]   Definitive Proxy Statement
[ ]   Definitive Additional Materials
[ ]   Soliciting Material Pursuant to Section 240.14a-11(c) or
      Section 240.14a-12


              NEUBERGER BERMAN INTERMEDIATE MUNICIPAL FUND INC.
--------------------------------------------------------------------------------
              (Name of Registrant as Specified In Its Charter)


--------------------------------------------------------------------------------
   (Name of Person(s) Filing Proxy Statement, if other than the Registrant)


Payment of Filing Fee (Check the appropriate box):

[X]  No fee required.
[ ]  Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11

     (1)  Title of each class of securities to which transaction applies:

     (2)  Aggregate number of securities to which transaction applies:

     (3)  Per  unit  price or  other underlying  value  of  transaction computed
          pursuant to  Exchange Act Rule 0-11  (Set forth  the  amount on  which
          the filing fee is calculated and state how it was determined):

     (4)  Proposed maximum aggregate value of transaction:

     (5)  Total fee paid:


[ ]  Fee paid previously with preliminary materials.

[ ]  Check  box  if  any  part of the fee is offset as provided by  Exchange Act
     Rule 0-11(a)(2)  and  identify  the filing for which the offsetting fee was
     paid previously.  Identify  the  previous  filing by registration statement
     number, or the Form or Schedule and the date of its filing.

     (1)  Amount Previously Paid:
     (2)  Form, Schedule or Registration Statement No.:
     (3)  Filing Party:
     (4)  Date Filed:




          NEUBERGER BERMAN CALIFORNIA INTERMEDIATE MUNICIPAL FUND INC.

                  NEUBERGER BERMAN INCOME OPPORTUNITY FUND INC.

                NEUBERGER BERMAN INTERMEDIATE MUNICIPAL FUND INC.

           NEUBERGER BERMAN NEW YORK INTERMEDIATE MUNICIPAL FUND INC.

                  NEUBERGER BERMAN REAL ESTATE INCOME FUND INC.

                    NEUBERGER BERMAN REALTY INCOME FUND INC.


                                                                August __, 2003

Dear Stockholder:

     The enclosed  Proxy  Statement  discusses two Proposals to be voted upon by
the  stockholders  of each  of the  above-named  funds  (each  a  "Fund").  As a
stockholder  of the Funds,  you are asked to review the Proxy  Statement  and to
cast your vote on the Proposals.  THE BOARD OF DIRECTORS OF EACH FUND RECOMMENDS
A VOTE FOR EACH OF THE PROPOSALS.

     As  discussed  in more detail in the enclosed  Proxy  Statement,  Neuberger
Berman  Inc.   ("Neuberger  Inc."),  the  parent  company  of  Neuberger  Berman
Management  Inc.  ("NB  Management")  and  Neuberger  Berman,   LLC  ("Neuberger
Berman"),  recently entered into an agreement with Lehman Brothers Holdings Inc.
("Lehman Brothers") whereby Lehman Brothers has agreed to acquire Neuberger Inc.
and, as a result,  indirectly  assume  control of NB  Management  and  Neuberger
Berman (the  "Transaction"),  subject to certain conditions (as discussed in the
enclosed  Proxy  Statement).  Upon  completion  of the  Transaction,  the Funds'
management and sub-advisory  agreements with NB Management and Neuberger Berman,
respectively,  will  automatically  terminate.  To  provide  for  continuity  of
management,  the  stockholders  of each Fund are being  asked to vote  "FOR" the
following two Proposals:

     1.   To  approve a new  Management  Agreement  between  each  Fund  and  NB
Management, to become effective upon completion of the Transaction; and

     2.   To approve a new  Sub-Advisory  Agreement  with  respect to each Fund,
between NB Management and Neuberger  Berman, to become effective upon completion
of the Transaction.

     YOUR VOTE IS  IMPORTANT  NO MATTER  HOW MANY  SHARES YOU OWN.  VOTING  YOUR
SHARES EARLY WILL AVOID COSTLY FOLLOW-UP MAIL AND TELEPHONE SOLICITATION.  After
reviewing the enclosed materials, please complete, sign and date your proxy card
and mail it  promptly in the  enclosed  return  envelope,  or help save time and
postage costs by voting by telephone,  through the Internet or in person.  If we
do not hear from you by __________,  2003, our proxy  solicitor may contact you.
If you have any questions about the proposals or the voting instructions, please



call us at 1-800-877-9700 or call Georgeson Shareholder Communications Inc., our
proxy solicitor, at 1-866-235-2033.



                   Very truly yours,



                   -------------------------------------
                   Peter E. Sundman
                   Chairman and Chief Executive Officer
                   Neuberger Berman California Intermediate Municipal Fund Inc.,
                   Neuberger Berman Income Opportunity Fund Inc.,
                   Neuberger Berman Intermediate Municipal Fund Inc.,
                   Neuberger Berman New York Intermediate Municipal Fund Inc.,
                   Neuberger Berman Real Estate Income Fund Inc., and
                   Neuberger Berman Realty Income Fund Inc.













The "Neuberger  Berman" name and logo are registered  service marks of Neuberger
Berman, LLC. "Neuberger Berman Management Inc." and the individual Fund names in
this proxy  statement are either  service  marks or registered  service marks of
Neuberger Berman  Management  Inc.(C)2003  Neuberger Berman  Management Inc. All
rights reserved.


                                       2


          NEUBERGER BERMAN CALIFORNIA INTERMEDIATE MUNICIPAL FUND INC.

                  NEUBERGER BERMAN INCOME OPPORTUNITY FUND INC.

                NEUBERGER BERMAN INTERMEDIATE MUNICIPAL FUND INC.

           NEUBERGER BERMAN NEW YORK INTERMEDIATE MUNICIPAL FUND INC.

                  NEUBERGER BERMAN REAL ESTATE INCOME FUND INC.

                    NEUBERGER BERMAN REALTY INCOME FUND INC.

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

                    NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

                        TO BE HELD ON SEPTEMBER 23, 2003

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


     A special  meeting  ("Meeting") of  stockholders of each of the above-named
funds (each a "Fund") will be held at the offices of Neuberger Berman,  LLC, 605
Third Avenue,  41st Floor, New York, New York 10158-3698,  on September 23, 2003
at 11:00 a.m. Eastern time.

     As  discussed  in more detail in the enclosed  Proxy  Statement,  Neuberger
Berman  Inc.   ("Neuberger  Inc."),  the  parent  company  of  Neuberger  Berman
Management  Inc.  ("NB  Management")  and  Neuberger  Berman,   LLC  ("Neuberger
Berman"),  recently entered into an agreement with Lehman Brothers Holdings Inc.
("Lehman Brothers") whereby Lehman Brothers has agreed to acquire Neuberger Inc.
and, as a result,  indirectly  assume  control of NB  Management  and  Neuberger
Berman (the  "Transaction"),  subject to certain conditions (as discussed in the
enclosed  Proxy  Statement).  Upon  completion  of the  Transaction,  the Funds'
management and sub-advisory  agreements with NB Management and Neuberger Berman,
respectively,  will  automatically  terminate.  To  provide  for  continuity  of
management,  the  stockholders  of each Fund are being  asked to vote  "FOR" the
following proposals:

     1.   To  approve  a new  Management  Agreement  between  each  Fund  and NB
          Management, to become effective upon completion of the Transaction;

     2.   To approve a new  Sub-Advisory  Agreement  with  respect to each Fund,
          between NB Management and Neuberger  Berman,  to become effective upon
          completion of the Transaction; and

     3.   To  transact  any other  business  as may  properly  come  before  the
          Meeting.

     As described in the Proxy  Statement,  each Management  Agreement  provides
that,  following  the  Transaction,  NB  Management  will  continue  to  provide
investment  advisory  services  to each Fund on the same terms and with the same
compensation  structure as is currently in effect.  Likewise,  each Sub-Advisory
Agreement  provides  that,  following  the  Transaction,  Neuberger  Berman will




continue  to provide  sub-advisory  services  to each Fund on the same terms and
with the same compensation structure as is currently in effect.  Proposals 1 and
2 are  discussed in greater  detail in the  enclosed  Proxy  Statement.  You are
entitled to vote at the Meeting if you owned  shares of one or more of the Funds
at the close of business on August 15, 2003 ("Record  Date").  If you attend the
Meeting,  you may vote your shares in person. If you do not expect to attend the
Meeting,  please complete,  date, sign and return the enclosed proxy card in the
enclosed postage-paid envelope or vote by telephone or through the Internet.

     We will admit to the Meeting (1) all  stockholders  of record on the Record
Date, (2) persons holding proof of beneficial ownership at the Record Date, such
as a letter or account statement from the person's broker,  (3) persons who have
been  granted  proxies,  and  (4)  such  other  persons  that  we,  in our  sole
discretion,  may elect to admit.  ALL  PERSONS  WISHING  TO BE  ADMITTED  TO THE
MEETING MUST PRESENT  PHOTO  IDENTIFICATION.  If you plan to attend the Meeting,
please contact us at 1-800-877-9700.

                   By order of the Board of Directors,



                   -----------------------------------
                   Claudia A. Brandon
                   Secretary
                   Neuberger Berman California Intermediate Municipal Fund Inc.,
                   Neuberger Berman Income Opportunity Fund Inc.,
                   Neuberger Berman Intermediate Municipal Fund Inc.,
                   Neuberger Berman New York Intermediate Municipal Fund Inc.,
                   Neuberger Berman Real Estate Income Fund Inc., and
                   Neuberger Berman Realty Income Fund Inc.


August __, 2003
New York, New York






                                       2




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


                            YOUR VOTE IS IMPORTANT
                       NO MATTER HOW MANY SHARES YOU OWN

          It is important that you vote even if your account was closed
                     after the August 15, 2003 Record Date.

     Please  indicate your voting  instructions  on the enclosed  proxy card(s),
sign and date the card(s),  and return the card(s) in the envelope provided.  If
you sign,  date and return the proxy  card(s)  but give no voting  instructions,
your shares will be voted "FOR" the proposals described above.

     To avoid  the  additional  expense  of  further  solicitation,  we ask your
cooperation  in mailing your proxy card(s)  promptly.  If you own shares of more
than one Fund,  you must submit a separate proxy card for each Fund in which you
own shares.

     As an  alternative  to  using  the  proxy  card to  vote,  you may  vote by
telephone,  through the Internet or in person. To vote by telephone, please call
the toll free  number  listed on the  enclosed  proxy  card(s).  To vote via the
Internet,  please access the website listed on your proxy  card(s).  Shares that
are  registered  in your name, as well as shares held in "street name" through a
broker,  may be voted via the Internet or by telephone.  To vote in this manner,
you will  need the  "control"  number(s)  that  appear  on your  proxy  card(s).
However,  any  proposal  submitted to a vote at the Meeting by anyone other than
the  officers or  Directors  of a Fund may be voted only in person or by written
proxy.  If we do not receive your completed  proxy card(s) by __________,  2003,
you may be contacted by our proxy solicitor.

If proxy cards submitted by corporations  and partnerships are not signed by the
appropriate  persons as set forth in the voting instructions on the proxy cards,
they will not be voted.


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


                                       3


                  IMPORTANT INFORMATION TO HELP YOU UNDERSTAND
                            AND VOTE ON THE PROPOSALS

While we  strongly  encourage  you to read the full text of the  enclosed  Proxy
Statement, we are also providing you with a brief overview of the subject of the
stockholder vote. Your vote is important.

QUESTIONS AND ANSWERS

Q.   WHAT IS HAPPENING?

A.   Neuberger Berman Inc.  ("Neuberger  Inc."), the parent company of Neuberger
     Berman Management Inc. ("NB Management"),  your Fund's investment  advisor,
     and Neuberger Berman, LLC ("Neuberger  Berman"),  your Fund's  sub-advisor,
     recently  entered  into an agreement  with Lehman  Brothers  Holdings  Inc.
     ("Lehman Brothers") whereby Lehman Brothers has agreed to acquire Neuberger
     Inc.  (the  "Transaction").  Following the closing of the  Transaction,  NB
     Management and Neuberger  Berman will each become an indirect  wholly owned
     subsidiary of Lehman  Brothers.  Neuberger Inc. and Lehman  Brothers expect
     the Transaction to close in Lehman  Brothers'  fourth fiscal quarter (which
     ends November 30, 2003),  subject to the satisfaction of certain conditions
     outlined in the Proxy Statement.

     As a result of the sale of Neuberger  Inc. to Lehman Brothers,  your Fund's
     management  agreement  with NB Management  and the  sub-advisory  agreement
     between NB Management and Neuberger  Berman will  automatically  terminate.
     Accordingly,  we are  asking  stockholders  of  each  Fund to  approve  new
     agreements.  The Proxy  Statement  provides  additional  information  about
     Lehman Brothers and the agreements.  If stockholders approve the proposals,
     the   effectiveness   of  each  is  contingent  upon  the  closing  of  the
     Transaction,  and each proposal will become effective only upon the closing
     of the Transaction.  If the Transaction is not consummated,  neither of the
     proposals will become effective.

     NB  Management  and  Neuberger  Berman  have  advised  each Fund's Board of
     Directors that  they  do not anticipate any changes in the Funds' portfolio
     managers or  their  portfolio  management  teams  in  connection  with  the
     Transaction.  However,  there can be  no  assurance  that  any   particular
     employee  of NB  Management  or  Neuberger  Berman  will  choose  to remain
     employed  by  NB  Management  or  Neuberger  Berman  before  or  after  the
     completion  of the Transaction

EACH  FUND'S  BOARD  OF  DIRECTORS  RECOMMENDS  THAT  YOU  VOTE  FOR EACH OF THE
PROPOSALS DESCRIBED IN THE PROXY STATEMENT.

Q.   WHY ARE YOU SENDING ME THIS INFORMATION?

A.   You are receiving  these proxy  materials  because you own shares in one or
     more of the  affected  Funds  and  have the  right  to vote on  these  very
     important proposals concerning your investment.

                                       1


Q.   WHY AM I BEING ASKED TO VOTE ON THE NEW AGREEMENTS?

A.   Completion  of the  Transaction  will  result in a change of  control of NB
     Management  and  Neuberger  Berman,  and as a  result,  will  automatically
     terminate  each Fund's  Management  Agreement  and  Sub-Advisory  Agreement
     pursuant to the Investment Company Act of 1940, as amended.  To ensure that
     the management of your Fund can continue  without any  interruption  and so
     that NB Management  and Neuberger  Berman can continue to provide the Funds
     with  services  equal in scope to those  currently  being  provided  to the
     Funds,  your approval of the new agreements is sought.

     For the  Transaction  to close,  certain  conditions  must be  satisfied or
     waived,  including,  among  others,  the approval of the new  agreements by
     stockholders  of funds that  represented at least 75% of the assets held as
     of May 31, 2003 in all of the Funds and in all other registered  investment
     companies  sponsored by NB Management.  The Board of Directors of your Fund
     has approved interim contracts in the event that the Transaction closes and
     stockholders  of a particular Fund have not yet approved new agreements for
     that Fund. If new agreements for a Fund are not approved within 150 days of
     the date on which the Transaction  closes, the Board of Directors will take
     such  action as it deems to be in the best  interests  of that Fund and its
     stockholders.

Q.   HOW WILL THE TRANSACTION AFFECT ME AS A FUND STOCKHOLDER?

A.   Your Fund and its investment  objectives will not change as a result of the
     completion  of the  Transaction,  and you will still own the same shares in
     the same Fund. The new agreements are identical in all material respects to
     the existing  agreements.  The  management fee rates that the Funds pay for
     investment  advisory  services  will be the  same  upon  completion  of the
     Transaction,  and NB  Management  and  Neuberger  Berman have  advised each
     Fund's Board of Directors  that they do not anticipate any change in any of
     the  Funds'  portfolio  managers  or their  portfolio  management  teams in
     connection with the completion of the Transaction.

Q.   WILL THE FUND'S NAME CHANGE?

A.   No. The name of your Fund will not change.

Q.   WILL THE FEES PAYABLE UNDER THE NEW AGREEMENTS  INCREASE AS A RESULT OF THE
     TRANSACTION?

A.   No. The proposals to approve the new agreements do not seek any increase in
     fee rates. In addition, all contractual  arrangements whereby NB Management
     has agreed to waive a percentage of the  management  fees of the Funds will
     continue upon completion of the Transaction.

Q.   HOW DO THE DIRECTORS OF MY FUND RECOMMEND THAT I VOTE?

A.   After careful consideration,  the Directors of your Fund recommend that you
     vote FOR the proposals.

                                       2


Q.   WILL MY FUND  PAY FOR  THIS  PROXY  SOLICITATION  OR FOR THE  COSTS  OF THE
     TRANSACTION?

A.   No. The Funds will not bear these costs. NB Management is bearing any costs
     that would otherwise be borne by the Funds.

Q.   HOW DO I VOTE MY SHARES?

A.   For your  convenience,  there are several ways you can vote:

     BY MAIL:  Vote,  sign and return the  enclosed  proxy card in the  enclosed
     self-addressed, postage-paid envelope;

     BY TELEPHONE: Call the number printed on the enclosed proxy card;

     BY INTERNET: Access the website address printed on the enclosed proxy card;

     IN PERSON:  Attend the Meeting as described in the Proxy Statement.  If you
     wish to attend the Meeting, please notify us by calling 1-800-877-9700.

Q.   WHY ARE MULTIPLE CARDS ENCLOSED?

A.   If you own shares of more than one Fund,  you will receive a proxy card for
     each Fund that you own.

Q.   WHOM SHOULD I CALL FOR ADDITIONAL INFORMATION ABOUT THIS PROXY STATEMENT?

A.   If you need any assistance,  or have any questions  regarding the proposals
     or how to  vote  your  shares,  please  call us at  1-800-877-9700  or call
     Georgeson  Shareholder   Communications  Inc.,  our  proxy  solicitor,   at
     1-866-235-2033.

                                       3



          NEUBERGER BERMAN CALIFORNIA INTERMEDIATE MUNICIPAL FUND INC.

                  NEUBERGER BERMAN INCOME OPPORTUNITY FUND INC.

                NEUBERGER BERMAN INTERMEDIATE MUNICIPAL FUND INC.

           NEUBERGER BERMAN NEW YORK INTERMEDIATE MUNICIPAL FUND INC.

                  NEUBERGER BERMAN REAL ESTATE INCOME FUND INC.

                    NEUBERGER BERMAN REALTY INCOME FUND INC.


                                605 THIRD AVENUE
                          NEW YORK, NEW YORK 10158-0180
                                  800-877-9700

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

                                 PROXY STATEMENT

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

                     FOR THE SPECIAL MEETING OF STOCKHOLDERS
                        TO BE HELD ON SEPTEMBER 23, 2003

                                  INTRODUCTION

     These  proxy  materials,  which  include a Notice  of  Special  Meeting  of
Stockholders,  a Proxy Statement, and one or more proxy cards, are being sent to
the  stockholders of each of the above-named  funds (each a "Fund") on behalf of
the  Funds'  Boards of  Directors  ("Directors")  in  connection  with a special
meeting of  stockholders  of each Fund to be held at the  offices  of  Neuberger
Berman,  LLC, 605 Third Avenue,  41st Floor,  New York,  New York  10158-3698 on
September  23, 2003,  at 11:00 a.m.  Eastern time and any  adjournments  thereof
(each a "Meeting").

SOLICITATION OF PROXIES

     The  Directors are  soliciting  votes from  stockholders  of each Fund with
respect to each  Proposal  described in this Proxy  Statement.  The  approximate
mailing date of this Proxy  Statement is August __,  2003.  If the  accompanying
proxy card is properly executed and returned in time to be voted at the Meeting,
the shares  represented by that proxy card will be voted in accordance  with the
instructions  provided on the proxy card. Executed proxy cards that are unmarked
will be voted to approve each  Proposal.  At the Meeting,  stockholders  of each
Fund will be asked to:

     1.  Approve a new  Management  Agreement  between  each Fund and  Neuberger
     Berman  Management  Inc.  ("NB  Management"),   to  become  effective  upon
     completion of the Transaction described in this Proxy Statement; and

                                       4



     2. Approve a new Sub-Advisory Agreement between NB Management and Neuberger
     Berman,  LLC  ("Neuberger  Berman")  with  respect  to each  Fund to become
     effective  upon  completion  of the  Transaction  described  in this  Proxy
     Statement.

     The  Directors  have set the close of  business  on August 15,  2003 as the
record date ("Record Date"),  and only stockholders of record on the Record Date
will  be  entitled  to  vote  on  these  Proposals  at the  Meeting.  Additional
information  regarding  outstanding shares,  voting your proxy and attending the
Meeting are included at the end of this Proxy Statement in the section  entitled
"Voting Information."

                                GENERAL OVERVIEW

THE TRANSACTION

     On July 21, 2003,  Neuberger Berman Inc.  ("Neuberger Inc.") entered into a
definitive  agreement with Lehman Brothers Holdings Inc. ("Lehman Brothers") and
a wholly-owned  subsidiary thereof ("Lehman Subsidiary") whereby Lehman Brothers
has agreed to acquire  Neuberger  Inc.  Pursuant to the terms and subject to the
conditions  set forth in the  acquisition  agreement,  Neuberger Inc. will merge
with and  into  Lehman  Subsidiary  with  Lehman  Subsidiary  continuing  as the
surviving  corporation and changing its name to, and continuing the business of,
Neuberger Inc. (the  "Transaction").  Neuberger Inc. is the parent company of NB
Management  and Neuberger  Berman,  which  respectively  serve as the investment
advisor  and  sub-advisor  to each  Fund.  As a result  of the  Transaction,  NB
Management  and  Neuberger  Berman  will each become an  indirect  wholly  owned
subsidiary of Lehman Brothers.

     The  estimated  total  value of the  Transaction  is  approximately  $2.625
billion (based on the closing price of Lehman  Brothers stock on July 21, 2003).
Under the terms of the acquisition agreement, each stockholder of Neuberger Inc.
would receive  (based on the closing price of Lehman  Brothers stock on July 21,
2003,  and including $42 million  in-the-money  options and less $255 million in
net  excess  cash as of June 30,  2003,  and  excluding  $1.6  million  unvested
restricted shares in five employee compensation plans) an implied price of about
$41.48  per  share,  consisting  of $9.49 in cash and  0.496  shares  of  Lehman
Brothers'  common stock. The number of shares to be received by each stockholder
of  Neuberger  Inc.  may,  however,  be adjusted  with such  adjustment  being a
function of the average trading price of Lehman  Brothers' common stock during a
period shortly prior to closing.

     Consummation of the Transaction is subject to certain terms and conditions,
including,  among others: (1) Neuberger Inc. obtaining the requisite approval of
its stockholders;  (2) the Funds obtaining approval to enter into new management
and  sub-advisory  agreements,  as set forth in this Proxy  Statement,  from the
stockholders of funds that represented 75% of the assets held as of May 31, 2003
in all of the Funds and in all other registered  investment  companies sponsored
by NB  Management;  (3)  agreement by other  specified  categories  of Neuberger
Berman clients  representing a certain percentage of the revenue attributable to
the  assets  under  management  for such  clients  to  continue  their  advisory
relationships with Neuberger Berman following completion of the Transaction; and
(4) Neuberger Inc.,  Lehman  Brothers and Lehman  Subsidiary  obtaining  certain
regulatory  approvals.  Although there is no assurance that the Transaction will

                                       5


be completed,  if each of the terms and conditions are satisfied or waived,  the
parties to the  Transaction  anticipate  that the closing will take place during
Lehman Brothers' fourth fiscal quarter (which ends November 30, 2003).

POST-TRANSACTION STRUCTURE AND OPERATIONS

     As described  above,  upon completion of the  Transaction,  Lehman Brothers
through its ownership of Lehman Subsidiary, the entity into which Neuberger Inc.
will  merge,  will  indirectly  control  NB  Management  and  Neuberger  Berman.
Operationally,  Neuberger  Inc.  will become a part of Lehman  Brothers'  Client
Services  Segment's  Wealth and Asset  Management  Division.  NB Management  and
Neuberger Berman will continue to operate under their existing names.

     NB Management  and Neuberger  Berman do not  anticipate  any changes in the
Funds' portfolio managers or their portfolio management teams in connection with
the Transaction.  Lehman Brothers has established a compensation pool to be used
for the  retention  of key  employees  in an effort to ensure  there  will be no
disruption in the quality of services  provided to stockholders of the Funds and
other  clients in  connection  with the  Transaction.  However,  there can be no
assurance that any particular employee of NB Management or Neuberger Berman will
choose to remain  employed by NB Management or Neuberger  Berman before or after
the completion of the Transaction.

LEHMAN BROTHERS AND ITS AFFILIATES

     Lehman  Brothers,  a publicly traded company,  is one of the leading global
investment  banks serving the financial needs of  corporations,  governments and
municipalities, institutional clients, and high-net-worth individuals worldwide.
Founded in 1850, Lehman Brothers  maintains  leadership  positions in equity and
fixed income sales,  trading and research,  investment banking,  private equity,
and private client services.  The Firm is headquartered in New York, London, and
Tokyo and operates in a network of offices around the world. Lehman Brothers and
its  affiliates  managed over $46.7 billion of client assets as of June 1, 2003.
Lehman Brothers' address is 745 Seventh Avenue, New York, New York 10019.

     Lehman  Subsidiary is a wholly owned subsidiary of Lehman Brothers and upon
consummation  of  the  Transaction,  will  own  all of  the  outstanding  voting
securities of NB Management and Neuberger Berman.

NEUBERGER INC. AND ITS AFFILIATES

     Neuberger Inc. is a publicly  traded holding company that is owned ____% by
the employees of Neuberger  Berman and its affiliates  and former  principals of
Neuberger  Berman.  Neuberger  Inc.  is the  parent  and  100%  owner of both NB
Management  and  Neuberger  Berman.   Subsidiaries  of  Neuberger  Inc.  include
investment  advisory  companies that together have $63.7 billion in assets under
management,  as of  June  30,  2003.  For  64  years,  Neuberger  Inc.  and  its
subsidiaries  and  predecessors  have  provided  clients  with a broad  range of
investment  products,  services and strategies for  individuals,  families,  and
taxable  and  non-taxable   institutions.   Neuberger  Inc.  engages  in  wealth
management  services  including  private  asset  management,  tax and  financial
planning,   and  personal  and  institutional  trust  services;   mutual  funds,
institutional   management  and  alternative   investments;   and   professional
securities services.

                                       6


     NB Management,  605 Third Avenue, 2nd Floor, New York, New York 10158-0180,
is a  wholly  owned  subsidiary  of  Neuberger  Inc.  As of the  closing  of the
Transaction,  NB Management will become an indirect  wholly owned  subsidiary of
Lehman  Brothers.  NB Management is an  SEC-registered  investment  advisor that
provides  investment  advisory  services  to the Funds  and to other  registered
investment  companies,  both  open-  and  closed-end.  It  also  provides  asset
allocation  advice  to  individuals.  NB  Management  is also an  SEC-registered
limited purpose broker-dealer that distributes shares of the Funds.

     Neuberger  Berman,  605 Third Avenue,  New York, New York 10158-3698,  is a
wholly owned  subsidiary of Neuberger Inc. As of the closing of the Transaction,
Neuberger  Berman will  become an indirect  wholly  owned  subsidiary  of Lehman
Brothers. Neuberger Berman is an SEC-registered investment advisor that provides
advisory services to the Funds and to other registered investment companies,  as
well  as to high  net  worth  individuals,  unregistered  investment  companies,
corporations,   and  institutional  investors.   Neuberger  Berman  is  also  an
SEC-registered  broker-dealer that provides  professional  securities  services,
including trade execution, securities lending and prime brokerage services.

     Exhibit  A to this  Proxy  Statement  provides  information  regarding  the
principal  executive  officers and  directors  of NB  Management  and  Neuberger
Berman.

ANTICIPATED BENEFITS OF THE TRANSACTION

     Neuberger Inc.  anticipates  that the Transaction and its combination  with
Lehman  Brothers will benefit  Neuberger Inc. and the Funds in a number of ways,
including:

     o    providing  Neuberger Inc. with global  capabilities in an increasingly
          global industry;
     o    expanding Neuberger Inc.'s product offerings;
     o    providing greater access to information resources;
     o    enhancing  retention of key employees by increasing  opportunities for
          these employees of Neuberger Inc. and its affiliates including through
          the benefits of being part of a larger,  financially stronger company;
          and
     o    affiliating  with  Lehman  Brothers,  which has made the growth of its
          asset  management  operations a key component of its business plans, a
          commitment  that is expected  to assist NB  Management  and  Neuberger
          Berman in continuing to expand their business,  attract more assets to
          the Funds and maintain the high level of services  they provide to the
          Funds.

NEW MANAGEMENT AND SUB-ADVISORY AGREEMENTS

     NB Management serves as advisor to each Fund and Neuberger Berman serves as
sub-advisor  to each Fund.  NB Management  and  Neuberger  Berman will undergo a
change of  control  as a result of the  Transaction.  This  change of control is
deemed to be an "assignment" of each Fund's  existing  Management  Agreement and
Sub-Advisory  Agreement (together,  "existing  Agreements") under the Investment
Company Act of 1940,  as amended (the "1940 Act").  As required by the 1940 Act,
each Fund's existing Management Agreement and Sub-Advisory Agreement provide for
their  automatic  termination  in the  event of an  assignment,  and  each  will

                                       7


terminate upon the consummation of the Transaction. Accordingly, stockholders of
each Fund are being asked to approve a new Management Agreement ("New Management
Agreement") and a new Sub-Advisory  Agreement ("New Sub-Advisory  Agreement" and
together,  "New  Agreements") that are identical in all material respects to the
existing  Agreements to allow NB Management and Neuberger  Berman to continue to
manage each Fund.  For each Fund,  the  Proposal  to approve a new  Sub-Advisory
Agreement is subject to the approval of the Proposal to approve a new Management
Agreement.  If the  Transaction  is not completed  for any reason,  the existing
Agreements will remain in effect for each Fund.

     If the  stockholders of a Fund do not approve the New Management  Agreement
and/or Sub-Advisory Agreement before the Transaction is completed, the Board has
approved  continuation  of  NB  Management's  advisory  services  and  Neuberger
Berman's   sub-advisory  services  under  interim  Management  and  Sub-Advisory
Agreements  (together,   "interim  Agreements")  pending  approval  of  the  New
Agreements by  stockholders of such Fund.  Compensation  earned by NB Management
and Neuberger  Berman under the interim  Agreements would be held in an interest
bearing escrow account pending  stockholder  approval of the New Agreements.  If
stockholders  approve the New Agreements within 150 days from the termination of
the  existing  Agreements,  the  amount  held in the escrow  account,  including
interest, will be paid to NB Management and Neuberger Berman. If stockholders do
not approve the New Agreements,  NB Management and Neuberger Berman will be paid
the lesser of the costs  incurred  performing  their  services under the interim
Agreements or the total amount in the escrow account, including interest earned.
If at the end of 150 days following  termination of a Fund's existing Agreements
the  Fund's  stockholders  still  have  not  approved  the New  Agreements,  the
Directors  would  either  negotiate  a  new  Management   Agreement  and/or  new
Sub-Advisory  Agreement with an advisory  organization selected by the Directors
or make other arrangements.  In the event the Transaction is not consummated, NB
Management  and  Neuberger   Berman  will  continue  to  serve  as  advisor  and
sub-advisor,  respectively,  to each Fund  pursuant to the terms of the existing
Agreements.


              PROPOSAL 1: APPROVAL OF THE NEW MANAGEMENT AGREEMENT

     Stockholders  of each Fund are  being  asked to  approve  a New  Management
Agreement  between the Fund and NB Management.  As described above,  each Fund's
existing   Management   Agreement  will  terminate  upon   consummation  of  the
Transaction.  Therefore,  approval of the New Management Agreements is sought so
that the management of each Fund can continue without interruption.

BOARD APPROVAL AND RECOMMENDATION

     The  Directors  who were present at an in-person  meeting held on August 5,
2003,  including a majority of the Directors who are not "interested persons" of
the  Fund  or of NB  Management  (as  defined  in the  1940  Act)  ("Independent
Directors"), unanimously approved the New Management Agreement for each Fund and
unanimously recommended that stockholders approve the New Management Agreements.
A summary of the  Directors'  considerations  is  provided  below in the section
entitled "Evaluation by the Directors."

                                       8


TERMS OF THE EXISTING AND NEW MANAGEMENT AGREEMENTS

     The form of the New Management  Agreements is attached as Exhibit B to this
Proxy Statement and the description of terms in this section is qualified in its
entirety by reference to Exhibit B. Appendix B-1 shows the date of each existing
Management  Agreement,  the date when the existing Management Agreement was last
approved by the Directors,  and the date when the existing Management  Agreement
was last submitted to a vote of stockholders of each applicable Fund,  including
the purpose of such submission.

     The terms of each New  Management  Agreement  are identical to those of the
respective existing Management Agreement,  except for the dates of execution and
termination.  The fee rates under each New Management Agreement are identical to
the fee rates under the respective existing Management  Agreement.  In addition,
all contractual fee waiver arrangements  between any Fund and NB Management will
be renewed and will continue upon completion of the  Transaction.  NB Management
has  advised  the  Boards  of  Directors  that it does not  anticipate  that the
Transaction will result in any reduction in the quality of services now provided
to the Funds or have any  adverse  effect on the  ability  of NB  Management  to
fulfill its obligations to the Funds.

     The following  discussion applies to both the existing Management Agreement
and the New Management Agreement for each Fund (the "Management Agreements"):

     INVESTMENT  MANAGEMENT  SERVICES.  NB Management  serves as the  investment
advisor to each Fund pursuant to the  Management  Agreements  with each Fund. In
relation to providing investment advisory and portfolio management services, the
Management  Agreements  provide that NB Management  will (1) obtain and evaluate
information relating to the economy, industries,  businesses, securities markets
and  securities,  (2) formulate a continuing  program for the investment of each
Fund's  assets   consistent  with  its  investment   objectives,   policies  and
restrictions,  and (3) determine  from time to time  securities to be purchased,
sold, retained or lent by the Funds and implement those decisions, including the
selection of entities through which such  transactions  are to be effected.  The
Management Agreements permit NB Management to effect securities  transactions on
behalf of the Funds  through  associated  persons of NB  Management,  which will
include Lehman  Brothers  after  completion of the  Transaction.  The Management
Agreements also specifically permit NB Management to compensate,  through higher
commissions, brokers and dealers who provide investment research and analysis to
the  Funds,  subject  to  obtaining  best  execution.  Exhibit  C to this  Proxy
Statement  sets forth  information  regarding  commissions  paid by the Funds to
affiliated brokers during the most recent fiscal year.

     EXPENSES.  NB  Management  pays  all  salaries,  expenses,  and fees of the
officers,  Directors, and employees of the Funds who are officers, directors, or
employees of NB Management or Neuberger Berman.  Each Fund bears the expenses of
its  operation  including  the  costs  associated  with:  custody,   stockholder
servicing, stockholder reports, pricing and portfolio valuation, communications,
legal and accounting fees,  Directors fees and expenses,  stockholder  meetings,
bonding and insurance,  brokerage  commissions,  taxes,  trade association fees,
nonrecurring and extraordinary  expenses,  organizational  expenses and offering
expenses  for  common  stock,  expenses  of  listing  on a  national  securities
exchange,  offering  expenses for any preferred stock,  expenses incident to any

                                       9


dividend  reinvestment  plan and  interest  as may accrue on  borrowings  of the
Funds.

     ADVISORY  FEE.  Each Fund pays NB  Management  an advisory fee based on the
Fund's  average  daily total assets minus  liabilities  other than the aggregate
indebtedness entered into for purposes of leverage ("Managed Assets"). Exhibit D
to this Proxy Statement sets forth the rate of compensation and aggregate amount
of  advisory  fees paid by each Fund  during the last fiscal year as well as the
amount  of   administration   fees  paid  to  NB   Management   pursuant  to  an
administration  agreement with the Funds.  The Directors of each Fund have voted
to approve a new administration  agreement,  similar in all material respects to
the current  agreement  described below, to take effect following the completion
of the  Transaction.  If the  Transaction  is not completed for any reason,  the
current administration agreement will remain in effect for each Fund.

     Pursuant  to an  administration  agreement  with each Fund,  NB  Management
provides  certain  stockholder-related  services  not  furnished  by the  Funds'
stockholder  servicing agent or third party investment  providers and assists in
the development and  implementation of specified programs and systems to enhance
overall stockholder servicing  capabilities.  NB Management solicits and gathers
stockholder proxies,  performs services connected with the qualification of Fund
shares for sale in various states, and furnishes other services necessary to the
operation of the Funds.

     NB Management  has also entered into  contractual  fee waiver  arrangements
with each Fund to waive a certain  percentage of each such Fund's Managed Assets
for a specified number of years. All contractual fee waiver arrangements between
the Funds and NB  Management  will be renewed and will  continue as currently in
effect upon  completion of the  Transaction.  Exhibit E to this Proxy  Statement
sets forth the current contractual fee waiver agreements.

     RETENTION OF  SUB-ADVISOR.  Subject to NB Management  obtaining the initial
and periodic  approvals required under Section 15 of the 1940 Act, NB Management
may retain a  sub-advisor,  at NB  Management's  own cost and  expense,  to make
investment  recommendations and research information available to NB Management.
However, retention of a sub-advisor in no way reduces the responsibilities of NB
Management  under the Management  Agreements and NB Management is responsible to
the Fund for all acts and omissions of the  sub-advisor  to the same extent that
NB Management is responsible for its own acts and omissions.  See "Limitation of
Liability," below.

     SERVICES  TO OTHER  CLIENTS.  The  Management  Agreements  do not limit the
freedom  of NB  Management  or  any  of  its  affiliates  to  render  investment
management and administrative  services to other investment companies, to act as
investment  advisor  or  investment   counselor  to  other  persons,   firms  or
corporations,  or to engage in other business activities.  NB Management acts as
investment advisor or sub-advisor to other registered  investment companies with
similar investment objectives and policies as certain of the Funds. Exhibit F to
this Proxy  Statement sets forth the name,  asset size and advisory fees paid to
NB Management by these other funds.

     LIMITATION OF LIABILITY. Neither NB Management nor any director, officer or
employee  of NB  Management  performing  services  pursuant  to  the  Management
Agreements  shall be liable for any error of  judgment  or mistake of law or any

                                       10


loss unless due to willful misfeasance,  bad faith, gross negligence or reckless
disregard of their duties under the Management Agreements.

     The Funds  indemnify NB  Management  against any and all expenses  incurred
investigating  or defending any claims for losses or  liabilities  not resulting
from  negligence,  disregard of its  obligations and duties under the Management
Agreements or disabling conduct by NB Management.  Indemnification  will be made
only after (1) a final  decision  on the  merits by a court or other  regulatory
body that NB  Management  was not  liable or (2) in absence of such a decision a
reasonable  determination  based on a review of the facts that NB Management was
not liable by (i) the vote of a majority of a quorum of Independent Directors of
the Fund or (ii) an independent legal counsel in a written opinion.

     TERM OF AGREEMENT. Each existing Management Agreement provides that it will
remain in effect until June 30, 2004. Each New Management Agreement will provide
that it will remain in effect for an initial term of two years.  Each Management
Agreement  will  remain  in  effect  from year to year  thereafter  if  approved
annually by (i) the vote of the holders of a majority of the outstanding  voting
securities  (as  defined  in the  1940  Act) of each  Fund,  or by the  Board of
Directors,  and also by (ii) the vote,  cast in person at a meeting  called  for
such purpose, of a majority of the Independent Directors.

     AMENDMENT OR  ASSIGNMENT.  Any amendment  must be in writing  signed by the
parties to the Agreement and is not effective  unless  authorized  for each Fund
(i) by resolution of the Directors,  including the vote or written  consent of a
majority of the Independent  Directors,  and (ii) by a vote of a majority of the
outstanding  voting  securities  (as  defined in the 1940 Act) of the Fund.  The
Management  Agreements  provide  that  they  will  terminate  automatically  and
immediately in the event of an assignment.

     TERMINATION. The Management Agreements may be terminated,  without penalty,
at any time by either  party to the  Agreement  upon sixty days'  prior  written
notice to the other party;  provided that in the case of  termination by any one
Fund, the  termination  has been  authorized (i) by resolution of the Directors,
including  the  vote  or  written  consent  of a  majority  of  the  Independent
Directors,  or (ii) by a vote of a majority of the outstanding voting securities
(as defined in the 1940 Act) of the Fund.

DIFFERENCES BETWEEN THE EXISTING AND NEW MANAGEMENT AGREEMENTS

     The only terms of the New Management Agreements that will be different from
the terms of the existing  Management  Agreements are the dates of execution and
termination.

  THE DIRECTORS RECOMMEND THAT STOCKHOLDERS OF EACH FUND VOTE "FOR" PROPOSAL 1.


              PROPOSAL 2: APPROVAL OF A NEW SUB-ADVISORY AGREEMENT

     Stockholders  of each Fund are being  asked to  approve a New  Sub-Advisory
Agreement with respect to their Fund between NB Management and Neuberger Berman.

                                       11


As described  above,  each existing  Sub-Advisory  Agreement will  automatically
terminate upon consummation of the Transaction.  Therefore,  approval of the New
Sub-Advisory  Agreements  is  sought  so that the  management  of each  Fund can
continue  without  interruption.  If the  Transaction  is not  completed for any
reason, the existing Sub-Advisory Agreements will continue in effect.

BOARD APPROVAL AND RECOMMENDATION

     The  Directors  who were present at an in-person  meeting held on August 5,
2003,  including a majority of the Independent  Directors,  unanimously approved
the New  Sub-Advisory  Agreement for each Fund and unanimously  recommended that
stockholders  approve the New  Sub-Advisory  Agreement  relating to that Fund. A
summary  of the  Directors'  considerations  is  provided  below in the  section
entitled "Evaluation by the Directors."

TERMS OF THE EXISTING AND NEW SUB-ADVISORY AGREEMENTS

     The form of the New  Sub-Advisory  Agreements  is  attached as Exhibit G to
this Proxy  Statement and the  description of terms in this section is qualified
in its entirety by  reference to Exhibit G.  Appendix G-1 shows the date of each
existing  Sub-Advisory  Agreement,  the  date  when  the  existing  Sub-Advisory
Agreement was last approved by the Directors  with respect to each Fund, and the
date when the existing  Sub-Advisory  Agreement was last  submitted to a vote of
stockholders of each Fund, including the purpose of such submission.

     The terms of each New Sub-Advisory  Agreement are identical to those of the
respective existing  Sub-Advisory  Agreement,  except for the dates of execution
and  termination.  The  Funds  do not pay any  fees  under  either  Sub-Advisory
Agreement. All payments to Neuberger Berman pursuant to a Sub-Advisory Agreement
with respect to any Fund are made by NB Management.  However, the fee rates paid
by NB Management under each New Sub-Advisory  Agreement are identical to the fee
rates under the respective existing  Sub-Advisory  Agreement.  NB Management and
Neuberger  Berman have advised the Boards that they do not  anticipate  that the
Transaction will result in any reduction in the quality of services now provided
to the Funds or have any adverse  effect on the ability of  Neuberger  Berman to
fulfill its obligations under the Sub-Advisory Agreements.

     The  following  discussion  applies  to  both  the  existing   Sub-Advisory
Agreement and the New  Sub-Advisory  Agreement for each Fund (the  "Sub-Advisory
Agreements"):

     SUB-ADVISORY  SERVICES.  On  behalf of each  Fund,  NB  Management  retains
Neuberger  Berman to serve as the  sub-advisor  to each Fund.  The  Sub-Advisory
Agreements  provide 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 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 Chief Investment Officer,  who is also
available for consultation with NB Management.

     SUB-ADVISORY  FEE. The Sub-Advisory  Agreements  provide 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.  Exhibit H

                                       12


to this Proxy  Statement sets forth the aggregate  amount of  sub-advisory  fees
paid by NB  Management  with  respect to each Fund during its last fiscal  year.
Neuberger  Berman also  serves as  sub-advisor  for all of the other  registered
investment  companies  sponsored  by NB  Management.  Exhibit  I to  this  Proxy
Statement  sets  forth  the  name,  asset  size and  sub-advisory  fees  paid to
Neuberger Berman by these other funds.

     LIMITATION  OF  LIABILITY.  Neuberger  Berman is not  liable for any act or
omission or any loss suffered by any Fund or any Fund's  stockholders  under the
Agreements  unless due to willful  misfeasance,  bad faith,  gross negligence or
reckless disregard of its duties under the Sub-Advisory Agreements.

     TERM OF AGREEMENT.  Each existing  Sub-Advisory  Agreement provides that it
will remain in effect until June 30, 2004. Each New Sub-Advisory  Agreement will
provide  that it will  remain in effect for an initial  term of two years.  Each
Sub-Advisory  Agreement  will remain in effect from year to year  thereafter  if
approved  annually  by  (i)  the  vote  of  the  holders  of a  majority  of the
outstanding  voting  securities (as defined in the 1940 Act) of each Fund, or by
the Directors, and also by (ii) the vote, cast in person at a meeting called for
such purpose, of a majority of the Independent Directors.

     TERMINATION.  The  Sub-Advisory  Agreements  may  be  terminated,   without
penalty,  at any time by the Fund, NB Management or Neuberger  Berman upon sixty
days' prior  written  notice to the other  party;  provided  that in the case of
termination by any Fund, the  termination  has been authorized (i) by resolution
of the  Directors,  including  the vote or written  consent of a majority of the
Independent Directors, or (ii) by a vote of a majority of the outstanding voting
securities  (as  defined  in  the  1940  Act)  of  the  Fund.  Furthermore,  the
Sub-Advisory  Agreements also terminate  automatically with respect to each Fund
if they are assigned or if the Management  Agreement  terminates with respect to
that Fund.

DIFFERENCES BETWEEN THE EXISTING AND NEW SUB-ADVISORY AGREEMENTS

     The only terms of the New  Sub-Advisory  Agreements  that will be different
from  the  terms  of the  existing  Sub-Advisory  Agreements  are the  dates  of
execution and termination.

 THE DIRECTORS RECOMMEND THAT STOCKHOLDERS OF EACH FUND VOTE "FOR" PROPOSAL 2.


                           EVALUATION BY THE DIRECTORS

BOARD MEETINGS AND CONSIDERATIONS

     The Directors met  telephonically on July 22, 2003, and in person on August
5, 2003. At the meeting on July 22, 2003, a committee of  Independent  Directors
was formed to lead the Boards' due diligence effort ("Due Diligence  Committee")
regarding  Lehman  Brothers,  the Transaction  and the New  Agreements.  The Due
Diligence  Committee,  with the assistance of counsel,  prepared a due diligence
request that was presented to Neuberger Inc. and Lehman Brothers. Along with the
other Directors,  the Due Diligence  Committee  reviewed the written response to

                                       13


the due diligence  request.  In addition,  the Due Diligence  Committee reviewed
voluminous supplemental material and reported their findings to the Directors at
the meeting on August 5, 2003. In evaluating the New Agreements,  the Directors,
including the Independent  Directors,  reviewed materials furnished by Neuberger
Inc., NB Management,  Neuberger  Berman and Lehman  Brothers and met with senior
representatives  of Neuberger Inc., NB Management,  Neuberger  Berman and Lehman
Brothers  regarding their  personnel,  operations and financial  condition.  The
Directors also reviewed the terms of the Transaction and its possible effects on
the Funds and their  stockholders.  Representatives of Neuberger Inc. and Lehman
Brothers discussed with the Directors the anticipated effects of the Transaction
and  indicated  their  belief  that as a  consequence  of the  Transaction,  the
operations  of the Fund and the  capabilities  of NB  Management  and  Neuberger
Berman to provide advisory and other services to the Fund would not be adversely
affected and should be enhanced by the  resources of Lehman  Brothers,  although
there can be no assurance as to any  particular  benefits  that may result.  The
Independent  Directors were advised by independent legal counsel throughout this
process.

     The Directors  considered the following factors to be of primary importance
to their recommendation:  (1) that the terms of the New Agreements are identical
in all material respects to those of the existing Agreements;  (2) assurances by
a representative of Lehman Brothers that NB Management and Neuberger Berman will
maintain substantial operational autonomy and continuity of management following
the  Transaction;  (3) the favorable  history,  reputation,  qualification,  and
background  of Neuberger  Inc.,  NB  Management,  Neuberger  Berman,  and Lehman
Brothers,  as well as the qualifications of their personnel and their respective
financial conditions; (4) the overall commitment of Lehman Brothers to retaining
personnel currently employed by NB Management and Neuberger Berman who currently
provide  services  to the  Funds;  (5) the fee and  expense  ratios of the Funds
relative to comparable  mutual funds; (6) that the fee and expense ratios of the
Funds  appear  to the  Board to be  reasonable  given the  quality  of  services
expected to be provided and the fees are identical to those paid by the Funds in
the past;  (7) the  commitment of NB  Management to maintain the Funds'  current
contractual  fee waiver  agreements to ensure Fund  stockholders  do not face an
increase in expenses upon  consummation of the Transaction;  (8) the performance
of the Funds relative to comparable mutual funds and unmanaged indices;  (9) the
commitment of Neuberger Inc. and its affiliates to pay the expenses of the Funds
in connection with the Transaction including all expenses in connection with the
solicitation of proxies so that stockholders of the Funds would not have to bear
such expenses; (10) the possible benefits that may be realized by the Funds as a
result  of NB  Management's  and  Neuberger  Berman's  combination  with  Lehman
Brothers,  including the resources of Lehman Brothers that would be available to
each Fund; and (11) that the  Transaction is expected to help ensure  continuity
of management of the Funds and may reduce the potential for future vulnerability
to changes  in  control of NB  Management  and  Neuberger  Berman  that could be
adverse to the Funds' interests.

     Peter E.  Sundman,  Chairman of the Board and Chief  Executive  Officer and
Director of each Fund, and Jack L. Rivkin,  President and Director of each Fund,
are each  stockholders  of Neuberger  Inc. Mr. Sundman has entered into a voting
agreement  with Lehman  Brothers  requiring  him to vote his shares of Neuberger
Inc. in favor of the Transaction. It is expected that Mr. Sundman and Mr. Rivkin
will receive approximately $________ and $________,  respectively, for their pro
rata portions of the aggregate consideration paid in the Transaction in exchange
for their  interests in Neuberger  Inc. As a result of their direct and indirect

                                       14


interests in the Transaction,  and in Neuberger Inc. and its affiliates, as well
as  in  future  employment   arrangements  with  Lehman  Brothers,  each  has  a
substantial  interest  in  stockholder  approval  of  the  New  Agreements.   In
considering the New Agreements, the Directors were aware of these interests.

     On April 28, 2003,  Lehman  Brothers Inc.  ("LBI"),  an affiliate of Lehman
Brothers,  without admitting or denying the allegations against it, consented to
settle  charges  brought by the SEC that LBI had violated  certain  rules of the
NASD, Inc. and the New York Stock Exchange,  Inc. ("NYSE").  This settlement and
settlements  with nine other brokerage  firms are part of the global  settlement
the firms have reached with the Commission,  NASD,  Inc., the NYSE, the New York
Attorney  General,  and other state  regulators.  Once this  settlement  becomes
effective, Lehman Brothers and its affiliates (which would include NB Management
and  Neuberger  Berman  following  completion of the  Transaction)  would not be
eligible to act as investments advisors, sub-advisors, or principal underwriters
to registered investment companies, unless they obtain exemptive relief from the
SEC.  Lehman  Brothers  has applied for such  relief.  Although  there can be no
assurance  that the necessary  exemption will be obtained,  Lehman  Brothers has
advised the Boards that it does not  anticipate  any  difficulties  in obtaining
such relief, based on applicable precedents and the express  understanding,  set
forth in the  consent,  that the staff of the SEC does not  oppose  the grant of
such relief.

SECTION 15(f) OF THE 1940 ACT

     Section 15(f) of the 1940 Act permits an investment advisor of a registered
investment  company (or any  affiliated  persons of the  investment  advisor) to
receive  any  amount or benefit  in  connection  with a change in control of the
investment advisor, provided that two conditions are satisfied.

     First, an "unfair burden" may not be imposed on the investment company as a
result of the change in control, or any express or implied terms,  conditions or
understandings applicable to the change in control. The term "unfair burden," as
defined in the 1940 Act,  includes any  arrangement  during the two-year  period
after  the  transaction  whereby  the  investment  advisor  (or  predecessor  or
successor advisor), or any "interested person" of the advisor (as defined in the
1940 Act),  receives or is entitled  to receive  any  compensation,  directly or
indirectly, from the investment company or its security holders (other than fees
for bona fide  investment  advisory  or other  services),  or from any person in
connection with the purchase or sale of securities or other property to, from or
on behalf of the  investment  company  (other than  ordinary  fees for bona fide
principal underwriting services).

     Second, during the three-year period after the transaction, at least 75% of
the members of the investment company's board of directors cannot be "interested
persons"  (as  defined  in the  1940  Act)  of  the  investment  advisor  or its
predecessor.

     The Directors have not been advised by Neuberger Inc. or Lehman Brothers of
any  circumstances  arising  from  the  Transaction  that  might  result  in the
imposition  of an "unfair  burden" on any Fund.  Moreover,  Lehman  Brothers has
agreed  that for two years after the  consummation  of the  Transaction,  Lehman
Brothers will use reasonable best efforts to refrain from imposing,  or agreeing
to impose,  any unfair burden on the Fund. At the present time,  over 80% of the

                                       15


Directors  are  classified  as  Independent  Directors  and  expect to remain so
classified  following NB Management's  and Neuberger  Berman's  combination with
Lehman  Brothers.  Lehman Brothers has agreed to use its reasonable best efforts
to ensure  that at least 75% of the  Directors  are  classified  as  Independent
Directors during the three-year period after the completion of the Transaction.

     Based on their  evaluation  of the materials  presented,  the Directors who
attended  the August 5 board  meeting,  including a majority of the  Independent
Directors,  unanimously  concluded  that  the  terms of the New  Agreements  are
reasonable,  fair and in the best interests of the Funds and their stockholders.
The Directors  believe that the New Agreements will enable each Fund to continue
to enjoy the high quality investment management and sub-advisory services it has
received  in the past from NB  Management  and  Neuberger  Berman,  at fee rates
identical  to  the  present  rates,   which  the   Independent   Directors  deem
appropriate,  reasonable  and  in  the  best  interests  of  the  Fund  and  its
stockholders. The Directors unanimously voted to approve and to recommend to the
stockholders of each Fund that they approve the New Agreements.


                               GENERAL INFORMATION

OWNERSHIP OF SHARES

     Information  regarding the percent  ownership of each person who as of July
31, 2003, to the knowledge of each Fund, owned of record and/or  beneficially 5%
or more of any class of the outstanding  shares of a Fund is included in Exhibit
J to this Proxy Statement.

     Since the beginning of each Fund's most recently  completed fiscal year, no
Director  has  purchased  or sold  securities  exceeding  1% of the  outstanding
securities of any class of NB  Management,  Neuberger  Berman,  Neuberger  Inc.,
Lehman Brothers or their subsidiaries.

PAYMENT OF SOLICITATION EXPENSES

     NB  Management  will pay the  expenses  of the  preparation,  printing  and
mailing of this Proxy Statement and its enclosures and of all solicitations.  NB
Management has engaged Georgeson Shareholder  Communications Inc. and Management
Information Services, an ADP company, proxy solicitation firms, to assist in the
solicitation of proxies. The aggregate cost of retaining such proxy solicitation
firms is expected to be about  $_______  plus  expenses in  connection  with the
solicitation of proxies.

OTHER MATTERS TO COME BEFORE THE MEETING

     The  Directors  do not know of any matters to be  presented  at the Meeting
other than those  described in this Proxy  Statement.  If other business  should
properly  come  before  the  Meeting,  the  proxy  holders  will  vote  on it in
accordance  with their best  judgment  for those shares they are  authorized  to
vote.  However,  any proposal submitted to a vote at the Meeting by anyone other
than the  officers  or  Directors  of the Fund may be voted only in person or by
written proxy.

                                       16


STOCKHOLDER PROPOSALS

     Any  stockholder  who is entitled to vote in the election of directors  and
who meets the requirements of the proxy rules under the Securities  Exchange Act
of 1934, as amended,  may submit to the Directors proposals to be considered for
submission to the stockholders of a Fund for their vote. The introduction of any
stockholder  proposal that the Board of Directors  decides should be voted on by
the  stockholders of the Fund,  shall be made by notice in writing  delivered or
mailed by first class United States mail,  postage prepaid,  to the Secretary of
the Fund,  and received by the  Secretary  not less than (i) with respect to any
proposal to be introduced at an annual meeting of  stockholders,  ninety days in
advance of the date of the Fund's proxy  statement  released to  stockholders in
connection with the previous year's annual meeting, and (ii) with respect to any
proposal to be introduced  at a special  meeting of  stockholders,  the close of
business on the seventh day  following  the date on which notice of such meeting
is first  given to  stockholders.  Each such  notice  shall set  forth:  (a) the
proposal  to be  introduced;  (b) the name and  address of the  stockholder  who
intends to make the proposal;  (c) a  representation  that the  stockholder is a
holder of record or  beneficial  owner of stock of the Fund  entitled to vote at
such  meeting  and  intends  to appear in person or by proxy at the  meeting  to
introduce the proposal or proposals,  specified in the notice; and (d) the class
and number of shares of stock held of record, owned beneficially and represented
by proxy by such stockholder as of the record date for the meeting and as of the
date of such notice.  The  chairperson  of the meeting may refuse to acknowledge
the  introduction  of any  stockholder  proposal not made in compliance with the
foregoing procedure.

INVESTMENT ADVISOR, PRINCIPAL UNDERWRITER AND ADMINISTRATOR

     NB  Management,  605  Third  Avenue,  New  York,  New  York  10158,  is the
investment  advisor and  administrator to each Fund. The principal  underwriters
for each Fund are set forth in Exhibit K to this Proxy Statement.

REPORTS TO STOCKHOLDERS

     Each Fund will furnish,  without  charge,  a copy of its most recent annual
report and any more recent  semi-annual  report to any stockholder upon request.
Stockholders  who want to obtain a copy of the Fund's  reports should direct all
written  requests to the attention of the Fund, at the offices of NB Management,
605 Third Avenue,  2nd Floor, New York, New York  10158-0180,  or call toll-free
1-800-877-9700.

                               VOTING INFORMATION

VOTING RIGHTS

     Stockholders of record on the Record Date are entitled to be present and to
vote at the Meeting.  Each share or fractional  share is entitled to one vote or
fraction  thereof.  Exhibit L of this Proxy  Statement  sets forth the number of
shares of each class of each Fund issued and  outstanding as of the Record Date.
Stockholders  of each  Fund  will  vote  on  each  Proposal  as a  single  class
regardless of the class of shares they own. Each Fund's  stockholders  will vote

                                       17


separately  on each Proposal with respect to that Fund. If you are a stockholder
of more than one  Fund,  you will be voting  on each  Proposal  separately  with
respect to each Fund in which you hold shares.

     If the enclosed proxy card is properly  executed and returned in time to be
voted at the Meeting,  the shares represented by the proxy card will be voted in
accordance  with the  instructions  marked on the proxy card. If no instructions
are marked on the proxy  card,  the proxy will be voted FOR each  Proposal.  Any
stockholder  who has given a proxy has the right to revoke it any time  prior to
its exercise by attending the Meeting and voting his or her shares in person, or
by submitting a letter of  revocation or a later-dated  proxy to the Fund at the
address  indicated on the enclosed  envelope provided with this Proxy Statement.
Any letter of revocation or later-dated proxy must be received by the Fund prior
to the Meeting and must indicate  your name and account  number to be effective.
Proxies  voted by  telephone  or Internet may be revoked at any time before they
are voted at the Meeting in the same manner  that  proxies  voted by mail may be
revoked.

     The Funds expect that  broker-dealer  firms holding  shares of the Funds in
"street  name" for the benefit of their  customers  and clients will request the
instructions  of such  customers and clients on how to vote their shares on each
proposal at the Meeting. The Funds understand that, under the rules of the NYSE,
such  broker-dealers  may grant authority to the proxies designated by the Funds
to vote on the approval of the New Agreements  for the Funds if no  instructions
have been  received  prior to the date  specified  in the  broker-dealer  firm's
request  for  voting  instructions.  Certain  broker-dealer  firms may  exercise
discretion over shares held in their name for which no instructions are received
by voting such shares in the same proportion as they have voted shares for which
they have received instructions.

     In tallying  stockholder  votes,  abstentions and "broker non-votes" (i.e.,
shares held by brokers or nominees  as to which (i)  instructions  have not been
received from the beneficial owners or the persons entitled to vote and (ii) the
broker or nominee returns the proxy but declines to vote on a particular matter)
will be counted as shares that are present and  entitled to vote for purposes of
determining the presence of a quorum. With respect to each Proposal, abstentions
and broker  non-votes  have the same effect as a vote cast against the Proposal.
For shares  held in  individual  retirement  accounts  (IRA,  Roth IRA or SIMPLE
Retirement  plans),  the IRA  custodian  will vote the shares in the  account in
accordance with instructions given by the depositor.  However,  if the depositor
fails to  provide  instructions  on how to vote the shares in the  account,  the
custodian will vote the undirected  shares in the same  proportion as shares are
voted considering all shares of the Fund for which instructions are received.

QUORUM; ADJOURNMENT

     A quorum with respect to a Fund is  constituted  by one-third of the Fund's
shares outstanding and entitled to vote at the Meeting,  present in person or by
proxy. If a quorum is not present at a Fund's Meeting or a quorum is present but
sufficient  votes to approve either Proposal are not received,  or for any other
reason, the persons named as proxies may propose one or more adjournments of the
Meeting to permit further  solicitation of proxies.  Any such  adjournment  will
require the affirmative  vote of a majority of the Fund's shares  represented at
the Meeting in person or by proxy and voting on the question of adjournment. The
persons  named as proxies will vote those proxies that they are entitled to vote
FOR a  proposal  in favor of such an  adjournment  and will vote  those  proxies
required to be voted AGAINST a proposal  against such  adjournment.  Abstentions

                                       18


and  broker  non-votes  will  have  no  effect  on  the  outcome  of a  vote  on
adjournment.  A stockholder vote may be taken on either or both of the Proposals
in this Proxy  Statement  with respect to any Fund prior to such  adjournment if
sufficient   votes  have  been   received  for  approval  and  it  is  otherwise
appropriate.

VOTE REQUIRED

     Stockholders  of each  Fund  must  separately  approve  the New  Management
Agreement and the New Sub-Advisory  Agreement for such Fund. Approval of each of
Proposal 1 and 2 by a Fund will require the  affirmative  vote of a "majority of
the outstanding  voting securities" of the Fund as defined in the 1940 Act. This
means the  lesser of (1) 67% or more of the  shares of the Fund  present  at the
Meeting if more than 50% of the  outstanding  shares of the Fund are  present in
person or represented by proxy, or (2) more than 50% of the  outstanding  shares
of the Fund.

     If the  stockholders of a Fund approve the New Management and  Sub-Advisory
Agreements for such Fund, their effectiveness is conditioned upon the completion
of the  Transaction,  which in turn is conditioned on the satisfaction or waiver
of certain  conditions  set forth in the  agreement  related to the  Transaction
including,  among other things,  that the stockholders of Neuberger Inc. approve
the  Transaction.  If the  stockholders  of  Neuberger  Inc.  do not approve the
Transaction,  the existing Management and Sub-Advisory Agreements will remain in
effect. If approved, these Proposals will not become effective until the closing
of the Transaction.

     To assure the presence of a quorum at the Meeting,  please promptly execute
and return the  enclosed  proxy.  A  self-addressed,  postage-paid  envelope  is
enclosed  for your  convenience.  Alternatively,  you may vote by  telephone  or
through the  Internet at the number or website  address  printed on the enclosed
proxy card.


                   By order of the Board of Directors,



                   -----------------------------------
                   Claudia A. Brandon
                   Secretary
                   Neuberger Berman California Intermediate Municipal Fund Inc.,
                   Neuberger Berman Income Opportunity Fund Inc.,
                   Neuberger Berman Intermediate Municipal Fund Inc.,
                   Neuberger Berman New York Intermediate Municipal Fund Inc.,
                   Neuberger Berman Real Estate Income Fund Inc., and
                   Neuberger Berman Realty Income Fund Inc.



August __, 2003
New York, New York


                                       19




                                    EXHIBIT A

                  PRINCIPAL EXECUTIVE OFFICERS AND DIRECTORS OF
                       NB MANAGEMENT AND NEUBERGER BERMAN


         The address of each principal executive officer and director of NB
Management and Neuberger Berman, listed below is 605 Third Avenue, New York, New
York 10158.

NAME                       PRINCIPAL OCCUPATION
----                       --------------------

Claudia A. Brandon         Secretary of each Fund; Vice President - Mutual Funds
                           Board Relations, NB Management

Robert Conti               Vice President of each Fund; Senior Vice President,
                           Neuberger Berman and NB Management

Brian Gaffney              Vice President of each Fund; Managing Director,
                           Neuberger Berman; Senior Vice President, NB
                           Management

Kevin Handwerker           Senior Vice President, Secretary and General Counsel,
                           Neuberger Inc. and Neuberger Berman

Jeffrey B. Lane            President, Chief Executive Officer and Director,
                           Neuberger Inc.; President, Chief Executive Officer,
                           Neuberger Berman; Director, NB Management

Robert Matza               Executive Vice President, Chief Operating Officer and
                           Director, Neuberger Inc.; Executive Vice President,
                           Chief Operating Officer, Neuberger Berman; Director,
                           NB Management

Jack L. Rivkin             President and Director of each Fund; Executive Vice
                           President and Chief Investment Officer, Neuberger
                           Inc.; Executive Vice President, Chief Investment
                           Officer and Head of Research and Research Sales
                           Departments, Neuberger Berman; Chairman and Director,
                           NB Management

Marvin C. Schwartz         Vice Chairman of the Board of Neuberger Inc.;
                           Managing Director, Neuberger Berman; Director NB
                           Management

Frederic B. Soule          Vice President of each Fund; Senior Vice President,
                           Neuberger Berman and NB Management

Matthew S. Stadler         Senior Vice President and Chief Financial Officer,
                           Neuberger Inc., Neuberger Berman and NB Management

Heidi L. Steiger           Executive Vice President, Neuberger Inc.; Executive
                           Vice President and Head of Private Asset Management
                           business, Neuberger Berman; Director, NB Management


                                      A-1




Peter E. Sundman           Chairman of the Board, Chief Executive Officer and
                           Director of each Fund; Executive Vice President,
                           Neuberger Inc.; Executive Vice President and Head of
                           Mutual Funds and Institutional business, Neuberger
                           Berman; President and Director, NB Management











                                      A-2




                                                                       EXHIBIT B

                        FORM OF NEW MANAGEMENT AGREEMENT


         This Agreement is made as of ________________, between ________________
____________________________, a Maryland corporation ("Fund"), and Neuberger
Berman Management Inc., a New York corporation ("Manager").

                                   WITNESSETH:
                                   ----------

         WHEREAS, Fund is registered under the Investment Company Act of 1940,
as amended ("1940 Act"), as an closed-end, non-diversified management investment
company; and

         WHEREAS, Fund desires to retain the Manager as investment adviser to
furnish the investment advisory and portfolio management services described
herein and the Manager is willing to furnish such services;

         NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:

         1.  SERVICES OF THE MANAGER.

         1.1 INVESTMENT MANAGEMENT SERVICES. The Manager shall act as the
investment adviser to the Fund and, as such, shall (i) obtain and evaluate such
information relating to the economy, industries, businesses, securities markets
and securities as it may deem necessary or useful in discharging its
responsibilities hereunder, (ii) formulate a continuing program for the
investment of the assets of the Fund in a manner consistent with its investment
objectives, policies and restrictions, and (iii) determine from time to time
securities to be purchased, sold, retained or lent by the Fund, and implement
those decisions, including the selection of entities with or through which such
purchases, sales or loans are to be effected; provided, that the Manager will
place orders pursuant to its investment determinations either directly with the
issuer or with a broker or dealer, and if with a broker or dealer, (a) will
attempt to obtain the best net price and most favorable execution of its orders,
and (b) may nevertheless in its discretion purchase and sell portfolio
securities from and to brokers and dealers who provide the Manager with
research, analysis, advice and similar services and pay such brokers and dealers
in return a higher commission or spread than may be charged by other brokers or
dealers.

             The Fund hereby authorizes any entity or person associated with the
Manager which is a member of a national securities exchange to effect or execute
any transaction on the exchange for the account of the Fund which is permitted
by Section 11(a) of the Securities Exchange Act of 1934 and Rule 11a2-2(T)
thereunder, and the Fund hereby consents to the retention of compensation for
such transactions in accordance with Rule 11a-2(T)(a)(iv).


                                      B-1



             The Manager shall carry out its duties with respect to the Fund's
investments in accordance with applicable law and the investment objectives,
policies and restrictions of the Fund adopted by the directors of Fund
("Directors"), and subject to such further limitations as the Fund may from time
to time impose by written notice to the Manager.

         1.2 The Manager can use any of the officers and employees of Neuberger
Berman, LLC to provide any of the non-investment advisory services described
herein, and can subcontract to third parties, provided the Manager remains as
fully responsible to the Fund under this contract as if the Manager had provided
services directly.

         2.  EXPENSES OF THE FUND.

         2.1 EXPENSES TO BE PAID BY THE MANAGER. The Manager shall pay all
salaries, expenses and fees of the officers, directors and employees of the Fund
who are officers, directors or employees of the Manager.

             In the event that the Manager pays or assumes any expenses of the
Fund not required to be paid or assumed by the Manager under this Agreement, the
Manager shall not be obligated hereby to pay or assume the same or any similar
expense in the future; PROVIDED, that nothing herein contained shall be deemed
to relieve the Manager of any obligation to the Fund under any separate
agreement or arrangement between the parties.

         2.2 EXPENSES TO BE PAID BY THE FUND. The Fund shall bear the expenses
of its operation, except those specifically allocated to the Manager under this
Agreement or under any separate agreement between the Fund and the Manager.
Subject to any separate agreement or arrangement between the Fund and the
Manager, the expenses hereby allocated to the Fund, and not to the Manager,
include, but are not limited to:

         2.2.1 CUSTODY. All charges of depositories, custodians, and other
agents for the transfer, receipt, safekeeping, and servicing of its cash,
securities, and other property.

         2.2.2 STOCKHOLDER SERVICING. All expenses of maintaining and servicing
Stockholder accounts, including but not limited to the charges of any
Stockholder servicing agent, dividend disbursing agent or other agent engaged by
the Fund to service Stockholder accounts.

         2.2.3 STOCKHOLDER REPORTS. All expenses of preparing, setting in type,
printing and distributing reports and other communications to Stockholders of
the Fund.

         2.2.4 PRICING AND PORTFOLIO VALUATION. All expenses of computing the
Fund's net asset value per share, including any equipment or services obtained
for the purpose of pricing shares or valuing the Fund's investment portfolio.

         2.2.5 COMMUNICATIONS. All charges for equipment or services used for
communications between the Manager or the Fund and any custodian, Stockholder
servicing agent, portfolio accounting services agent, dividend disbursing agent,


                                      B-2



dividend reinvestment plan agent or other agent engaged by the Fund.

         2.2.6 LEGAL AND ACCOUNTING FEES. All charges for services and expenses
of the Fund's legal counsel and independent auditors.

         2.2.7 DIRECTORS' FEES AND EXPENSES. All compensation of Directors other
than those affiliated with the Manager, all expenses incurred in connection with
such unaffiliated Directors' services as Directors, and all other expenses of
meetings of the Directors or committees thereof.

         2.2.8 STOCKHOLDER MEETINGS. All expenses incidental to holding meetings
of Stockholders, including the printing of notices and proxy materials, and
proxy solicitation therefor.

         2.2.9 BONDING AND INSURANCE. All expenses of bond, liability, and other
insurance coverage required by law or regulation or deemed advisable by the
Directors, including, without limitation, such bond, liability and other
insurance expense that may from time to time be allocated to the Fund in a
manner approved by the Directors.

         2.2.10 BROKERAGE COMMISSIONS. All brokers' commissions and other
charges incident to the purchase, sale or lending of the Fund's portfolio
securities.

         2.2.11 TAXES. All taxes or governmental fees payable by or with respect
to the Fund to federal, state or other governmental agencies, domestic or
foreign, including stamp or other transfer taxes.

         2.2.12 TRADE ASSOCIATION FEES. All fees, dues and other expenses
incurred in connection with the Fund's membership in any trade association or
other investment organization.

         2.2.13 NONRECURRING AND EXTRAORDINARY EXPENSES. Such nonrecurring and
extraordinary expenses as may arise, including the costs of actions, suits, or
proceedings to which the Fund is a party and the expenses the Fund may incur as
a result of its legal obligation to provide indemnification to Fund's officers,
Directors and agents.

         2.2.14 ORGANIZATIONAL EXPENSES AND OFFERING EXPENSES FOR COMMON STOCK.
Any and all organizational expenses of the Fund and any and all offering
expenses for shares of the Fund's common stock paid by the Manager shall be
reimbursed by the Fund if and at such time or times agreed by the Fund and the
Manager.

         2.2.15 EXPENSES OF LISTING ON A NATIONAL SECURITIES EXCHANGE. Any and
all expenses of listing and maintaining the listing of shares of the Fund's
common stock on any national securities exchange.


                                      B-3



         2.2.16 OFFERING EXPENSES FOR ANY PREFERRED STOCK. Any and all offering
expenses (including rating agency fees) for any preferred stock of the Fund paid
by the Manager shall be reimbursed by the Fund if and at such time or times
agreed by the Fund and the Manager.

         2.2.17 DIVIDEND REINVESTMENT PLAN. Any and all expenses incident to any
dividend reinvestment plan.

         2.2.18 INTEREST. Such interest as may accrue on borrowings of the Fund.

         3.  ADVISORY FEE.

         3.1 FEE. As compensation for all services rendered, facilities provided
and expenses paid or assumed by the Manager under this Agreement, the Fund shall
pay the Manager an annual fee equal to 0.60% of the Fund's average daily total
assets minus liabilities other than the aggregate indebtedness entered into for
purposes of leverage ("Managed Assets").

         3.2 COMPUTATION AND PAYMENT OF FEE. The advisory fee shall accrue on
each calendar day, and shall be payable monthly on the first business day of the
next succeeding calendar month. The daily fee accruals shall be computed by
multiplying the fraction of one divided by the number of days in the calendar
year by the annual advisory fee rate, and multiplying this product by the
Managed Assets of the Fund, determined in the manner established by the
Directors, as of the close of business on the last preceding business day on
which the Fund's net asset value was determined.

         4.  OWNERSHIP OF RECORDS.

             All records required to be maintained and preserved by the Fund
pursuant to the provisions or rules or regulations of the Securities and
Exchange Commission under Section 31 (a) of the 1940 Act and maintained and
preserved by the Manager on behalf of the Fund are the property of the Fund and
shall be surrendered by the Manager promptly on request by the Fund; provided,
that the Manager may at its own expense make and retain copies of any such
records.

         5.  REPORTS TO MANAGER.

             The Fund shall furnish or otherwise make available to the Manager
such copies of the Fund's financial statements, proxy statements, reports, and
other information relating to its business and affairs as the Manager may, at
any time or from time to time, reasonably require in order to discharge its
obligations under this Agreement.

         6.  REPORTS TO THE FUND.

             The Manager shall prepare and furnish to the Fund such reports,
statistical data and other information in such form and at such intervals as the
Fund may reasonably request.


                                      B-4



         7.  RETENTION OF SUB-ADVISER.

         Subject to the Fund obtaining the initial and periodic approvals
required under Section 15 of the 1940 Act, the Manager may retain a sub-adviser,
at the Manager's own cost and expense, for the purpose of making investment
recommendations and research information available to the Manager. Retention of
a sub-adviser shall in no way reduce the responsibilities or obligations of the
Manager under this Agreement and the Manager shall be responsible to Fund for
all acts or omissions of the sub-adviser in connection with the performance of
the Manager's duties hereunder.

         8.  SERVICES TO OTHER CLIENTS.

         Nothing herein contained shall limit the freedom of the Manager or any
affiliated person of the Manager to render investment management and
administrative services to other investment companies, to act as investment
adviser or investment counselor to other persons, firms or corporations, or to
engage in other business activities.

         9.  LIMITATION OF LIABILITY OF MANAGER AND ITS PERSONNEL.

         9.1 Neither the Manager nor any director, officer or employee of the
Manager performing services for the Fund at the direction or request of the
Manager in connection with the Manager's discharge of its obligations hereunder
shall be liable for any error of judgment or mistake of law or for any loss
suffered by the Fund in connection with any matter to which this Agreement
relates; provided, that nothing herein contained shall be construed (i) to
protect the Manager against any liability to the Fund or its Stockholders to
which the Manager would otherwise be subject by reason of the Manager's
misfeasance, bad faith, or gross negligence in the performance of the Manager's
duties, or by reason of the Manager's reckless disregard of its obligations and
duties under this Agreement ("disabling conduct"), or (ii) to protect any
director, officer or employee of the Manager who is or was a Director or officer
of the Fund against any liability to the Fund or its Stockholders 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 the Fund.

         9.2 The Fund will indemnify the Manager against, and hold it harmless
from, any and all expenses (including reasonable counsel fees and expenses)
incurred investigating or defending against claims for losses or liabilities
described in Section 9.1 not resulting from negligence, disregard of its
obligations and duties under this Agreement or disabling conduct by the Manager.
Indemnification shall be made only following: (i) a final decision on the merits
by a court or other body before whom the proceeding was brought that the Manager
was not liable by reason of negligence, disregard of its obligations and duties
under this Agreement or disabling conduct or (ii) in the absence of such a
decision, a reasonable determination, based upon a review of the facts, that the
Manager was not liable by reason of negligence, disregard of its obligations and
duties under this Agreement or disabling conduct by (a) the vote of a majority
of a quorum of directors of the Fund who are neither "interested persons" of the
Fund nor parties to the proceeding ("disinterested non-party directors") or (b)
an independent legal counsel in a written opinion. The Manager shall be entitled
to advances from the Fund for payment of the reasonable expenses incurred by it


                                      B-5



in connection with the matter as to which it is seeking indemnification
hereunder in the manner and to the fullest extent permissible under the Maryland
General Corporation Law. The Manager shall provide to the Fund a written
affirmation of its good faith belief that the standard of conduct necessary for
indemnification by the Fund has been met and a written undertaking to repay any
such advance if it should ultimately be determined that the standard of conduct
has not been met. In addition, at least one of the following additional
conditions shall be met: (a) the Manager shall provide security in form and
amount acceptable to the Fund for its undertaking; (b) the Fund is insured
against losses arising by reason of the advance; or (c) a majority of a quorum
of the full Board of Directors of the Fund, the members of which majority are
disinterested non-party directors, or independent legal counsel, in a written
opinion, shall have determined, based on a review of facts readily available to
the Fund at the time the advance is proposed to be made, that there is reason to
believe that the Manager will ultimately be found to be entitled to
indemnification hereunder.

         10. EFFECT OF AGREEMENT.

         Nothing herein contained shall be deemed to require the Fund to take
any action contrary to the Articles of Incorporation or By-Laws of the Fund, any
actions of the Directors binding upon the Fund, or any applicable law,
regulation or order to which the Fund is subject or by which it is bound, or to
relieve or deprive the Directors of their responsibility for and control of the
conduct of the business and affairs of the Fund.

         11. TERM OF AGREEMENT.

         The term of this Agreement shall begin on the date first above written
and, unless sooner terminated as hereinafter provided, this Agreement shall
remain in effect through June 30, 2004. Thereafter, this Agreement shall
continue in effect from year to year, subject to the termination provisions and
all other terms and conditions hereof, provided, such continuance is approved at
least annually by vote of the holders of a majority of the outstanding voting
securities of the Fund or by the Directors, provided, that in either event such
continuance is also approved annually by the vote, cast in person at a meeting
called for the purpose of voting on such approval, of a majority of the
Directors who are not parties to this Agreement or interested persons of either
party hereto; and provided further that the Manager shall not have notified the
Fund in writing at least sixty (60) days prior to the first expiration date
hereof or at least sixty (60) days prior to any expiration date hereof of any
year thereafter that it does not desire such continuation. The Manager shall
furnish to the Fund, promptly upon its request, such information as may
reasonably be necessary to evaluate the terms of this Agreement or any
extension, renewal or amendment thereof.

         12. AMENDMENT OR ASSIGNMENT OF AGREEMENT.

         Any amendment to this Agreement shall be in writing signed by the
parties hereto; provided, that no such amendment shall be effective unless
authorized on behalf of the Fund (i) by resolution of the Directors, including
the vote or written consent of a majority of the Directors who are not parties
to this Agreement or interested persons of either party hereto, and (ii) by vote


                                      B-6



of a majority of the outstanding voting securities of the Fund. This Agreement
shall terminate automatically and immediately in the event of its assignment.

         13. TERMINATION OF AGREEMENT.

         This Agreement may be terminated at any time by either party hereto,
without the payment of any penalty, upon sixty (60) days' prior written notice
to the other party; provided, that in the case of termination by the Fund, such
action shall have been authorized (i) by resolution of the Directors, including
the vote or written consent of a majority of Directors who are not parties to
this Agreement or interested persons' of either party hereto, or (ii) by vote of
a majority of the outstanding voting securities of the Fund.

         14. NAME OF THE FUND.

         The Fund hereby agrees that if the Manager shall at any time for any
reason cease to serve as investment adviser to the Fund, the Fund shall, if and
when requested by the Manager, eliminate from the Fund's name the name
"Neuberger Berman" and thereafter refrain from using the name "Neuberger Berman"
or the initials "NB" in connection with its business or activities, and the
foregoing agreement of the Fund shall survive any termination of this Agreement
and any extension or renewal thereof.

         15. INTERPRETATION AND DEFINITION OF TERMS.

         Any question of interpretation of any term or provision of this
Agreement having a counterpart in or otherwise derived from a term or provision
of the 1940 Act shall be resolved by reference to such term or provision of the
1940 Act and to interpretation thereof, if any, by the United States courts or,
in the absence of any controlling decision of any such court, by rules,
regulations or orders of the Securities and Exchange Commission validly issued
pursuant to the 1940 Act. Specifically, the terms "vote of a majority of the
outstanding voting securities," "interested person," "assignment" and
"affiliated person," as used in this Agreement shall have the meanings assigned
to them by Section 2(a) of the 1940 Act. In addition, when the effect of a
requirement of the 1940 Act reflected in any provision of this Agreement is
modified, interpreted or relaxed by a rule, regulation or order of the
Securities and Exchange Commission, whether of special or of general
application, such provision shall be deemed to incorporate the effect of such
rule, regulation or order.

         16. CHOICE OF LAW

         This Agreement is made and to be principally performed in the State of
New York and except insofar as the 1940 Act or other federal laws and
regulations may be controlling, this Agreement shall be governed by, and
construed and enforced in accordance with, the internal laws of the State of New
York.


                                      B-7



         17. CAPTIONS.

         The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof or
otherwise affect their construction or effect.

         18. EXECUTION IN COUNTERPARTS.

         This Agreement may be executed simultaneously in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their respective officers thereunto duly authorized and their
respective seals to be hereunto affixed, as of the day and year first above
written.




                                           [FUND]


                                           By:
                                              ----------------------------------


                                           Title:
                                                 -------------------------------



                                           NEUBERGER BERMAN MANAGEMENT INC.


                                           By:
                                              ----------------------------------


                                           Title:
                                                 -------------------------------


Date ___________________



                                      B-8





                                                      APPENDIX B-1

----------------------------------------------------------------------------------------------------------------------
                                                                           DATE OF        DIRECTOR     STOCKHOLDER
FUND                                                                       AGREEMENT      APPROVAL     APPROVAL
----------------------------------------------------------------------------------------------------------------------
                                                                                              
Neuberger Berman Income Opportunity Fund Inc.                              6/24/2003      __/__/2003   __/__/2003(1)
----------------------------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate California Municipal Fund Inc.               9/24/2002      __/__/2002   __/__/2002(1)
----------------------------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate Municipal Fund Inc.                          9/24/2002      __/__/2002   __/__/2002(1)
----------------------------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate New York Municipal Fund Inc.                 9/24/2002      __/__/2002   __/__/2002(1)
----------------------------------------------------------------------------------------------------------------------
Neuberger Berman Real Estate Fund Inc.                                     4/24/2003      __/__/2003   __/__/2003(1)
----------------------------------------------------------------------------------------------------------------------
Neuberger Berman Realty Income Fund Inc.                                   11/25/2002     __/__/2002   __/__/2002(1)
----------------------------------------------------------------------------------------------------------------------

(1) Shareholder approval was obtained prior to the commencement of operations for the Fund by NB Management, the sole shareholder.






                                                          B-9





                                                         EXHIBIT C

                                          COMMISSIONS PAID TO AFFILIATED BROKERS

                                         (For fiscal year ended October 31, 2002)

----------------------------------------------------------------------------------------------------------------------
FUND                                                          AFFILIATED BROKER      COMMISSIONS    % OF TOTAL
                                                                                     PAID           COMMISSIONS PAID
----------------------------------------------------------------------------------------------------------------------
                                                           
Neuberger Berman Income Opportunity Fund Inc.                 Neuberger Berman
                                                              --------------------------------------------------------
                                                              Lehman Brothers
----------------------------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate California Municipal Fund Inc.  Neuberger Berman
                                                              --------------------------------------------------------
                                                              Lehman Brothers
----------------------------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate Municipal Fund Inc.             Neuberger Berman
                                                              --------------------------------------------------------
                                                              Lehman Brothers
----------------------------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate New York Municipal Fund Inc.    Neuberger Berman
                                                              --------------------------------------------------------
                                                              Lehman Brothers
----------------------------------------------------------------------------------------------------------------------
Neuberger Berman Real Estate Fund Inc.                        Neuberger Berman
                                                              --------------------------------------------------------
                                                              Lehman Brothers
----------------------------------------------------------------------------------------------------------------------
Neuberger Berman Realty Income Fund Inc.                      Neuberger Berman
                                                              --------------------------------------------------------
                                                              Lehman Brothers
----------------------------------------------------------------------------------------------------------------------
Neuberger Berman Manhattan Fund                               Neuberger Berman
                                                              --------------------------------------------------------
                                                              Lehman Brothers
----------------------------------------------------------------------------------------------------------------------




                                                           C-1




                                             EXHIBIT D-1

                         RATE OF COMPENSATION UNDER THE MANAGEMENT AGREEMENT


----------------------------------------------------------------------------------------------------
FUND                                                                        RATE OF COMPENSATION
                                                                            BASED ON EACH FUND'S
                                                                            MANAGED ASSETS
----------------------------------------------------------------------------------------------------
                                                                         
Neuberger Berman Income Opportunity Fund Inc.                               0.60%
Neuberger Berman Real Estate Fund Inc.
Neuberger Berman Realty Income Fund Inc.
----------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate California Municipal Fund Inc.                0.25%
Neuberger Berman Intermediate Municipal Fund Inc
Neuberger Berman Intermediate New York Municipal Fund Inc.
----------------------------------------------------------------------------------------------------







                                                D-1





                                             EXHIBIT D-2

                                     FEES PAID TO NB MANAGEMENT
                    (Pursuant to Management and Administration Agreements between
                                    each Fund and NB Management)

-----------------------------------------------------------------------------------------------------
FUND                                                               MANAGEMENT       ADMINISTRATION
                                                                   FEE              FEE
-----------------------------------------------------------------------------------------------------
                                                                              
Neuberger Berman Income Opportunity Fund Inc.
-----------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate California Municipal Fund Inc.
-----------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate Municipal Fund Inc.
-----------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate New York Municipal Fund Inc.
-----------------------------------------------------------------------------------------------------
Neuberger Berman Real Estate Fund Inc.
-----------------------------------------------------------------------------------------------------
Neuberger Berman Realty Income Fund Inc.
-----------------------------------------------------------------------------------------------------








                                                D-2





                                                                                                                        EXHIBIT E


                                                   CURRENT CONTRACTUAL FEE WAIVERS

                     PERCENTAGE WAIVED (ANNUAL RATE AS A PERCENTAGE OF NET ASSETS ATTRIBUTABLE TO COMMON SHARES-
                                           ASSUMING NO LEVERAGE IS ISSUED OR OUTSTANDING)

------------------------------------------------------------------------------------------------------------------------------------
      Fiscal Period         Intermediate      California        New York       Real Estate           Realty               Income
    Ending October 31,        Municipal      Intermediate     Intermediate       Income              Income            Opportunity
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                        
           2002                 0.25%            0.25%            0.25%             -                   -                   -
           2003                 0.25%            0.25%            0.25%           0.40%               0.25%               0.25%
           2004                 0.25%            0.25%            0.25%           0.40%               0.25%               0.25%
           2005                 0.25%            0.25%            0.25%           0.40%               0.25%               0.25%
           2006                 0.25%            0.25%            0.25%           0.40%               0.25%               0.25%
           2007                 0.25%            0.25%            0.25%           0.40%               0.25%               0.25%
           2008                 0.20%            0.20%            0.20%           0.32%               0.20%               0.25%
           2009                 0.15%            0.15%            0.15%           0.24%               0.15%               0.19%
           2010                 0.10%            0.10%            0.10%           0.16%               0.10%               0.13%
           2011                 0.05%            0.05%            0.05%           0.08%               0.05%               0.07%
------------------------------------------------------------------------------------------------------------------------------------


              PERCENTAGE WAIVED (ANNUAL RATE AS A PERCENTAGE OF NET ASSETS ATTRIBUTABLE TO COMMON SHARES- ASSUMING THE
                                                    ISSUANCE OF PREFERRED SHARES)
------------------------------------------------------------------------------------------------------------------------------------
      Fiscal Period         Intermediate      California        New York       Real Estate           Realty               Income
    Ending October 31,        Municipal      Intermediate     Intermediate       Income              Income            Opportunity
------------------------------------------------------------------------------------------------------------------------------------
           2002                 0.40%            0.40%            0.40%             -                   -                   -
           2003                 0.40%            0.40%            0.40%           0.61%               0.37%               0.37%
           2004                 0.40%            0.40%            0.40%           0.61%               0.37%               0.37%
           2005                 0.40%            0.40%            0.40%           0.61%               0.37%               0.37%
           2006                 0.40%            0.40%            0.40%           0.61%               0.37%               0.37%
           2007                 0.40%            0.40%            0.40%           0.61%               0.37%               0.37%
           2008                 0.32%            0.32%            0.32%           0.49%               0.30%               0.37%
           2009                 0.24%            0.24%            0.24%           0.37%               0.22%               0.28%
           2010                 0.16%            0.16%            0.16%           0.25%               0.15%               0.19%
           2011                 0.08%            0.08%            0.08%           0.12%               0.07%               0.10%
------------------------------------------------------------------------------------------------------------------------------------




                                                                E-1



                                                                       EXHIBIT F

                     NAME, ASSET SIZE AND ADVISORY FEES PAID
                     TO NB MANAGEMENT BY OTHER SIMILAR FUNDS















                                      F-1




                                                                       EXHIBIT G

                       FORM OF NEW SUB-ADVISORY AGREEMENT

                        NEUBERGER BERMAN MANAGEMENT INC.
                                605 Third Avenue
                          New York, New York 10158-0006



Neuberger Berman, LLC
605 Third Avenue
New York, New York 10158-3698


Dear Sirs:

         We have entered into a Management Agreement with ______________________
____________________________ ("Fund") pursuant to which we are to act as
investment adviser to the Fund. We hereby agree with you as follows:

     1.  You agree for the duration of this Agreement to furnish us with such
         investment recommendations and research information, of the same type
         as that which you from time to time provide to your employees for use
         in managing client accounts, all as we shall reasonably request. In the
         absence of willful misfeasance, bad faith or gross negligence in the
         performance of your duties, or of the reckless disregard of your duties
         and obligations hereunder, you shall not be subject to liability for
         any act or omission or any loss suffered by the Fund or its security
         holders in connection with the matters to which this Agreement relates.

     2.  In consideration of your agreements set forth in paragraph 1 above, we
         agree to pay you on the basis of direct and indirect costs to you of
         performing such agreements. Indirect costs shall be allocated on a
         basis mutually satisfactory to you and to us.

     3.  As used in this Agreement, the terms "assignment" and "vote of a
         majority of the outstanding voting securities" shall have the meanings
         given to them by Section 2(a)(4) and 2(a)(42), respectively, of the
         Investment Company Act of 1940, as amended.

         This Agreement shall terminate automatically in the event of its
assignment, or upon termination of the Management Agreement between the Fund and
the undersigned.

         This Agreement may be terminated at any time, without the payment of
any penalty, (a) by the Directors of the Fund or by vote of a majority of the
outstanding securities of the Fund or by the undersigned on not less than sixty
days' written notice addressed to you at your principal place of business; and
(b) by you, without the payment of any penalty, on not less than thirty nor more


                                      G-1



than sixty days' written notice addressed to the Fund and the undersigned at the
Fund's principal place of business.

         This Agreement shall remain in full force and effect until June 30,
2004 (unless sooner terminated as provided above) and from year to year
thereafter only so long as its continuance is approved in the manner required by
the Investment Company Act of 1940, as from time to time amended.

         If you are in agreement with the foregoing, please sign the form of
acceptance on the enclosed counterpart hereof and return the same to us.


                                Very truly yours,

                                NEUBERGER BERMAN MANAGEMENT INC.


                                By:
                                   ---------------------------------------



                                The foregoing is hereby
                                accepted as of the date
                                first above written.

                                NEUBERGER BERMAN, LLC


                                By:
                                   ---------------------------------------



                                      G-2








                                                                                                APPENDIX G-1

-------------------------------------------------------------------------------------------------------------------
                                                                         DATE OF       DIRECTOR     STOCKHOLDER
FUND                                                                     AGREEMENT     APPROVAL     APPROVAL
-------------------------------------------------------------------------------------------------------------------
                                                                                           
Neuberger Berman Income Opportunity Fund Inc.                            6/24/2003     __/__/2003   __/__/2003(1)
-------------------------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate California Municipal Fund Inc.             9/24/2002     __/__/2002   __/__/2002(1)
-------------------------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate Municipal Fund Inc.                        9/24/2002     __/__/2002   __/__/2002(1)
-------------------------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate New York Municipal Fund Inc.               9/24/2002     __/__/2002   __/__/2002(1)
-------------------------------------------------------------------------------------------------------------------
Neuberger Berman Real Estate Fund Inc.                                   4/24/2003     __/__/2003   __/__/2003(1)
-------------------------------------------------------------------------------------------------------------------
Neuberger Berman Realty Income Fund Inc.                                 11/25/2002    __/__/2002   __/__/2002(1)
-------------------------------------------------------------------------------------------------------------------

(1) Shareholder approval was obtained prior to the commencement of operations for the Fund by NB Management, the sole
shareholder.





                                                      G-3



                                                                       EXHIBIT H

                          FEES PAID TO NEUBERGER BERMAN
         (Pursuant to Sub-Advisory Agreement with respect to each Fund
                   between NB Management and Neuberger Berman)

--------------------------------------------------------------------------------
FUND                                                           SUB-ADVISORY FEES
--------------------------------------------------------------------------------
Neuberger Berman Income Opportunity Fund Inc.
--------------------------------------------------------------------------------
Neuberger Berman Intermediate California Municipal Fund Inc.
--------------------------------------------------------------------------------
Neuberger Berman Intermediate Municipal Fund Inc.
--------------------------------------------------------------------------------
Neuberger Berman Intermediate New York Municipal Fund Inc.
--------------------------------------------------------------------------------
Neuberger Berman Real Estate Fund Inc.
--------------------------------------------------------------------------------
Neuberger Berman Realty Income Fund Inc.
--------------------------------------------------------------------------------






                                      H-1



                                                                       EXHIBIT I


                     NAME, ASSET SIZE AND ADVISORY FEES PAID
                   TO NEUBERGER BERMAN BY OTHER SIMILAR FUNDS












                                      I-1




                                                                       EXHIBIT J


               CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

         As of July 31, 2003, the following are all of the beneficial and record
owners of more than five percent of each class of each Fund known to the Fund.
Except where indicated with an asterisk, the owners listed are record owners.
These entities hold these shares of record for the accounts of certain of their
clients and have informed the Funds of their policy to maintain the
confidentiality of holdings in their client accounts, unless disclosure is
expressly required by law.

FUND AND CLASS       NAME AND ADDRESS                    PERCENTAGE OF
                                                         CLASS OWNED















                                      J-1





                                                                                             EXHIBIT K


                                            PRINCIPAL UNDERWRITERS


-------------------------------------------------------------------------------------------------------------
FUND                                 PRINCIPAL UNDERWRITERS
-------------------------------------------------------------------------------------------------------------
                                  
Neuberger Berman California          Merrill Lynch, Pierce, Fenner & Smith Incorporated, 4 World
Intermediate Municipal Fund Inc.     Financial Center, North Tower, 250 Vesey Street, New York NY 10080;
                                     A.G. Edwards & Sons, Inc., One North Jefferson Ave., St. Louis, MO
                                     63103; Quick & Reilly, Inc., 26 Broadway, New York, NY 10004; Wells
                                     Fargo Van Kasper, LLC, 420 Montgomery Street, San Francisco, CA 94104;
                                     Robert W. Baird & Co. Incorporated, 777 E. Wisconsin Ave., Milwaukee,
                                     WI 53202; Crowell, Weedon & Co., 624 South Grand Ave., Los Angeles, CA
                                     90017; H&R Block Financial Advisors, Inc., 751 Griswold Street,
                                     Detroit, MI 48226.
-------------------------------------------------------------------------------------------------------------
Neuberger Berman Income              Citigroup Global Markets Inc., 388 Greenwich Street, New York, New York
Opportunity Fund Inc.                10013; Merrill Lynch, Pierce, Fenner & Smith Incorporated, 4 World
                                     Financial Center, New York, New York 10080; Advest, Inc., 90 State
                                     House Square, Hartford, Connecticut 06103; Janney Montgomery Scott LLC,
                                     1801 Market Street, Philadelphia, Pennsylvania 19103; Legg Mason Wood
                                     Walker, Incorporated, 100 Light Street, Baltimore, Maryland 21202;
                                     Stifel, Nicolaus & Company, Incorporated, 501 North Broadway, St.
                                     Louis, Missouri 63102.
-------------------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate        Merrill Lynch, Pierce, Fenner & Smith Incorporated, 4 World Financial
Municipal Fund Inc.                  Center, North Tower, 250 Vesey Street, New York NY 10080; A.G. Edwards
                                     & Sons, Inc., One North Jefferson Ave., St. Louis, MO 63103; Legg Mason
                                     Wood Walker, Incorporated, 100 Light Street, Baltimore, MD 21202; Quick
                                     & Reilly, Inc., 26 Broadway, New York, NY 10004; RBC Dain Rauscher
                                     Inc., One Liberty Plaza, New York, NY 10006; Wells Fargo Van Kasper
                                     LLC, 420 Montgomery Street, San Francisco, CA 94104; Advest, Inc., 90
                                     State House Square, Hartford, CT 06103; Robert W. Baird & Co.
                                     Incorporated, 777 E. Wisconsin Ave., Milwaukee, WI 53202; H&R Block
                                     Financial Advisors, Inc., 751 Griswold Street, Detroit, MI 48226;
                                     Fahnestock & Co. Inc., 125 Broad Street, New York, NY 10004; Ferris,
                                     Baker Watts, Incorporated, 1700 Pennsylvania Ave., N.W., Washington,
                                     D.C. 20006; Janney Montgomery Scott LLC, 1801 Market Street,
                                     Philadelphia, PA 19103; J.J.B. Hilliard, W.L. Lyons, Inc., Hilliard
                                     Lyons Center, Louisville, KY 40202-2517; McDonald Investments Inc., a
                                     KeyCorp Company, 800 Superior Ave., Cleveland, OH 44114; Morgan Keegan
                                     & Company, Inc., 50 Front Street, Morgan Keegan Tower, Memphis, TN
                                     38103.
-------------------------------------------------------------------------------------------------------------


                                                     K-1



-------------------------------------------------------------------------------------------------------------
Neuberger Berman New York            Merrill Lynch, Pierce, Fenner & Smith Incorporated, 4 World Financial
Intermediate Municipal Fund Inc.     Center, North Tower, 250 Vesey Street, New York NY 10080; A.G. Edwards
                                     & Sons, Inc., One North Jefferson Ave., St. Louis, MO 63103; Quick &
                                     Reilly, Inc., 26 Broadway, New York, NY 10004; Wells Fargo Van Kasper,
                                     LLC, 420 Montgomery Street, San Francisco, CA 94104; Robert W. Baird &
                                     Co. Incorporated, 777 E. Wisconsin Ave., Milwaukee, WI 53202; Crowell,
                                     Weedon & Co., 624 South Grand Ave., Los Angeles, CA 90017; H&R Block
                                     Financial Advisors, Inc., 751 Griswold Street, Detroit, MI 48226.
-------------------------------------------------------------------------------------------------------------
Neuberger Berman Real Estate         A.G. Edwards & Sons, Inc., One North Jefferson Ave., St. Louis, MO
Income Fund Inc.                     63103; Robert W. Baird & Co. Incorporated, 777 E. Wisconsin Ave.,
                                     Milwaukee, WI 53202; BB&T Capital Markets, 200 South College Street,
                                     Charlotte, NC 28202; CIBC World Markets Corp., 425 Lexington Avenue,
                                     New York, NY 10017; Ferris, Baker Watts, Incorporated, 1700
                                     Pennsylvania Ave., N.W., Washington, D.C. 20006; Fidelity Capital
                                     Markets, 82 Devonshire Street, Boston, MA 02109; J.J.B. Hilliard, W.L.
                                     Lyons, Inc., Hilliard Lyons Center, Louisville, KY 40202-2517; Janney
                                     Montgomery Scott LLC, 1801 Market Street, Philadelphia, PA 19103; Legg
                                     Mason Wood Walker, Incorporated, 100 Light Street, Baltimore, MD 21202;
                                     McDonald Investments Inc., 800 Superior Ave., Cleveland, OH 44114;
                                     Raymond James & Associates, Inc., 880 Carillon Parkway, St. Petersburg,
                                     FL 33716; Stifel, Nicolaus & Company, Incorporated, 501 North Broadway,
                                     St. Louis, MO 63102; U.S. Bancorp Piper Jaffray Inc., 800 Nicollet
                                     Mall, Minneapolis, MN 55402; Wells Fargo Securities, LLC, 600
                                     California Street, Suite 1700, San Francisco, CA 94108.
-------------------------------------------------------------------------------------------------------------
Neuberger Berman Realty Income       A.G. Edwards & Sons, Inc., One North Jefferson Ave., St. Louis, MO
Fund Inc.                            63103; Merrill Lynch, Pierce, Fenner & Smith Incorporated, 4 World
                                     Financial Center, New York, NY 10080; Robert W. Baird & Co.
                                     Incorporated, 777 E. Wisconsin Ave., Milwaukee, WI 53202; BB&T Capital
                                     Markets, 200 South College Street, Charlotte, NC 28202; Ferris, Baker
                                     Watts, Incorporated, 1700 Pennsylvania Ave., N.W., Washington, D.C.
                                     20006; J.J.B. Hilliard, W.L. Lyons, Inc., Hilliard Lyons Center,
                                     Louisville, KY 40202-2517; Janney Montgomery Scott LLC, 1801 Market
                                     Street, Philadelphia, PA 19103; Legg Mason Wood Walker, Incorporated,
                                     100 Light Street, Baltimore, MD 21202; McDonald Investments Inc., 800
                                     Superior Ave., Cleveland, OH 44114; Raymond James & Associates, Inc.,
                                     880 Carillon Parkway, St. Petersburg, FL 33716; RBC Dain Rauscher Inc.,
                                     60 South Sixth Street, Minneapolis, MN 55402; Stifel, Nicolaus &
                                     Company, Incorporated, 501 North Broadway, St. Louis, MO 63102; U.S.
                                     Bancorp Piper Jaffray Inc., 800 Nicollet Mall, Minneapolis, MN 55402.
-------------------------------------------------------------------------------------------------------------



                                                     K-2






                                                                       EXHIBIT L

                          NUMBER OF SHARES OUTSTANDING
                           FOR EACH CLASS OF EACH FUND
                              AS OF THE RECORD DATE



--------------------------------------------------------------------------------------------------
FUND                                                     CLASS            SHARES OUTSTANDING
--------------------------------------------------------------------------------------------------
                                                      
Neuberger Berman Income Opportunity Fund Inc.            Common
                                                         -----------------------------------------
                                                         Preferred
--------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate California
Municipal Fund Inc.                                      Common
                                                         -----------------------------------------
                                                         Preferred
--------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate Municipal
Fund Inc.                                                Common
                                                         -----------------------------------------
                                                         Preferred
--------------------------------------------------------------------------------------------------
Neuberger Berman Intermediate New York Municipal
Fund Inc.                                                Common
                                                         -----------------------------------------
                                                         Preferred
--------------------------------------------------------------------------------------------------
Neuberger Berman Real Estate Fund Inc.                   Common
                                                         -----------------------------------------
                                                         Preferred
--------------------------------------------------------------------------------------------------
Neuberger Berman Realty Income Fund Inc.                 Common
                                                         -----------------------------------------
                                                         Preferred
--------------------------------------------------------------------------------------------------




                                      L-1





------------------------------------------EZVOTE CONSOLIDATED PROXY CARD--------

NEUBERGER BERMAN FUNDS               THE TOP  HALF OF THIS  FORM IS YOUR  EZVOTE
                                     CONSOLIDATED PROXY. IT REFLECTS ALL OF YOUR
                                     ACCOUNTS  REGISTERED  TO  THE  SAME  SOCIAL
                                     SECURITY   OR  TAX  I.D.   NUMBER  AT  THIS
                                     ADDRESS.   BY  VOTING   AND   SIGNING   THE
                                     CONSOLIDATED PROXY CARD, YOU ARE VOTING ALL
                                     OF THESE  ACCOUNTS  IN THE SAME  MANNER  AS
                                     INDICATED ON THE REVERSE SIDE OF THE FORM.

-----------------------------------  -------------------------------------------
MASTER CONTROL NUMBER:                  TO  VOTE  BY  TELEPHONE  OR  INTERNET,
 XXX XXX XXX XXX XX                             SEE INSTRUCTIONS BELOW.
-----------------------------------  -------------------------------------------
        PROXY FOR THE SPECIAL MEETING OF STOCKHOLDERS SEPTEMBER 23, 2003

The undersigned appoints as proxies Robert Conti,  Frederic Soule and Claudia A.
Brandon,  and  each  of them  (with  power  of  substitution),  to vote  all the
undersigned's shares in Neuberger Berman Funds ("Neuberger Fund") at the Special
Meeting of Stockholders  to be held on September 23, 2003 at 11:00 a.m.  Eastern
Time at the offices of Neuberger Berman,  LLC, 605 Third Avenue, 41st Floor, New
York, New York 10158-3698, and any ajournment thereof ("Meeting"),  with all the
power the undersigned would have if personally present.

The  shares  represented  by this  proxy  will be  voted as  instructed.  UNLESS
INDICATED TO THE CONTRARY, THIS PROXY SHALL BE DEEMED TO GRANT AUTHORITY TO VOTE
"FOR" THE  PROPOSALS  SPECIFIED  ON THE  REVERSE  SIDE.  THIS PROXY ALSO  GRANTS
DISCRETIONARY POWER TO VOTE UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE
THE MEETING.

YOUR VOTE IS  IMPORTANT NO MATTER HOW MANY SHARES YOU OWN. IF YOU ARE NOT VOTING
BY PHONE OR  INTERNET,  PLEASE  SIGN AND DATE THIS  PROXY  BELOW  AND  RETURN IT
PROMPTLY IN THE ENCLOSED ENVELOPE.

                                                  Date ______________________

                                    Signature (owner, trustee, custodian, etc.)
                                    (PLEASE SIGN IN BOX)

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

                                    -------------------------------------------
                                    Please sign exactly as name appears hereon.
                                    If  shares  are  held in the  name of joint
                                    owners, each should sign. Attorneys-in-fact,
                                    executors,  administrators,  etc.  should so
                                    indicate. If stockholder is a corporation or
                                    partnership,  please sign in full  corporate
                                    or partnership name by authorized person.


                                                                           NB-EZ
__________   DETACH CONSOLIDATED PROXY CARD AT PERFORATION BELOW.   ____________


   FAST, CONVENIENT VOTING OPTIONS!    TO VOTE EACH OF YOUR ACCOUNTS SEPARATELY

o  VOTE  BY  TELEPHONE.   Call  our  On the  reverse  side of this  form (and on
   toll-free    dedicated    voting  accompanying  pages, if necessary) you will
   number    1-800-690-6903.    The  find  individual  ballots,  one for each of
   voting  site is open 24  hours a  your  accounts.  If you would  wish to vote
   day,  7 days a week.  Enter your  each of these accounts separately,  sign in
   MASTER   CONTROL   NUMBER  shown  the   signature   box   below,   mark  each
   above and  follow  the  recorded  individual  ballot to  indicate  your vote,
   instructions.  You may  vote all  detach  the form at the  perforation  above
   accounts at once or each account  and return the individual  ballots  portion
   separately.  Your  vote  will be  only.
   confirmed  at  the  end  of  the
   call.

o  VOTE ON THE INTERNET.  Log on to  NOTE: IF YOU ELECT TO VOTE  EACH ACCOUNT
   our  Internet  voting web site -           SEPARATELY, DO NOT RETURN THE
   www.proxyweb.com  and enter your           CONSOLIDATED PROXY CARD ABOVE.
   MASTER  CONTROL  NUMBER.  Follow
   the on-screen instructions.  You     SIGN AND DATE BELOW IF YOU ARE VOTING
   may vote all  accounts  at once             EACH ACCOUNT SEPARATELY.
   or each account separately.  You
   may     request     an    e-mail
   confirmation of your vote.

NOTE:  IF YOU  VOTE BY  PHONE OR ON
        THE INTERNET, PLEASE DO
         NOT RETURN YOUR PROXY
              CARD ABOVE.
                                                  Date ______________________


                                    Signature (owner, trustee, custodian, etc.)
                                    (PLEASE SIGN IN BOX)

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

                                    -------------------------------------------
                                    Please sign exactly as name appears hereon.
                                    If  shares  are  held in the  name of joint
                                    owners, each should sign. Attorneys-in-fact,
                                    executors,  administrators,  etc.  should so
                                    indicate. If stockholder is a corporation or
                                    partnership,  please sign in full  corporate
                                    or partnership name by authorized person.


                                                                          NB-IND




----------------------------------------- EZVOTE CONSOLIDATED PROXY CARD -------




           YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWN.
      IF YOU ARE NOT VOTING BY PHONE OR INTERNET, PLEASE SIGN AND DATE THE
 OTHER SIDE OF THIS PROXY CARD AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.

PLEASE FILL IN BOX(ES) AS SHOWN USING BLACK OR BLUE INK OR NUMBER 2 PENCIL.
PLEASE DO NOT USE FINE POINT PENS.  [X]



                                                         FOR   AGAINST   ABSTAIN

1.  To approve a new Management  Agreement between       [ ]     [ ]       [ ]
    the  Fund and NB Management.



2.  To approve a new  Sub-Advisory  Agreement with       [ ]     [ ]       [ ]
    respect to the Fund,  between  NB
    Management and Neuberger Berman.





              THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.

                                                                NB-CEF-EZ

__________   DETACH CONSOLIDATED PROXY CARD AT PERFORATION BELOW.  ____________




                                                         INDIVIDUAL BALLOTS
                                     NOTE: IF YOU HAVE USED THE CONSOLIDATED BALLOT, DO NOT VOTE
                                                    THE INDIVIDUAL BALLOTS BELOW.

----------------------------------------------------------   ----------------------------------------------------------
XXX XXXXXXXXXX XXX                                           XXX XXXXXXXXXX XXX

JOHN Q. STOCKHOLDER                                          JOHN Q. STOCKHOLDER
123 MAIN STREET                                              123 MAIN STREET
ANYTOWN USE 12345                      CONTROL NUMBER        ANYTOWN USE 12345                        CONTROL NUMBER
                                     XXX XXX XXX XXX XX                                             XXX XXX XXX XXX XX

FUND NAME PRINTS HERE                                        FUND NAME PRINTS HERE
                                                                                           


1. To approve a new Management       FOR  AGAINST  ABSTAIN   1. To approve a new Management       FOR  AGAINST  ABSTAIN
   Agreement between the Fund and    [ ]    [ ]      [ ]        Agreement between the Fund        [ ]    [ ]      [ ]
   NB Management                                                and NB Management

2. To approve a new Sub-Advisory     FOR  AGAINST  ABSTAIN   2. To approve a new Sub-Advisory     FOR  AGAINST  ABSTAIN
   Agreement with respect to         [ ]    [ ]      [ ]        Agreement with respect to         [ ]    [ ]      [ ]
   the Fund, between NB                                         the Fund, between NB
   Management and Neuberger                                     Management and Neuberger
   Berman.                                                      Berman.
----------------------------------------------------------   ----------------------------------------------------------
XXX XXXXXXXXXX XXX                                           XXX XXXXXXXXXX XXX

JOHN Q. STOCKHOLDER                                          JOHN Q. STOCKHOLDER
123 MAIN STREET                                              123 MAIN STREET
ANYTOWN USE 12345                      CONTROL NUMBER        ANYTOWN USE 12345                      CONTROL NUMBER
                                     XXX XXX XXX XXX XX                                           XXX XXX XXX XXX XX

FUND NAME PRINTS HERE                                        FUND NAME PRINTS HERE

1. To approve a new Management       FOR  AGAINST  ABSTAIN   1. To approve a new Management       FOR  AGAINST  ABSTAIN
   Agreement between the Fund and    [ ]    [ ]      [ ]        Agreement between the Fund        [ ]    [ ]      [ ]
   NB Management                                                and NB Management

2. To approve a new Sub-Advisory     FOR  AGAINST  ABSTAIN   2. To approve a new Sub-Advisory     FOR  AGAINST  ABSTAIN
   Agreement with respect to         [ ]    [ ]      [ ]        Agreement with respect to         [ ]    [ ]      [ ]
   the Fund, between NB                                         the Fund, between NB
   Management and Neuberger                                     Management and Neuberger
   Berman.                                                      Berman.
----------------------------------------------------------   ----------------------------------------------------------
                                                                     NB-CEF-IND