KIRKPATRICK & LOCKHART LLP
1800 MASSACHUSETTS AVENUE, N.W.
WASHINGTON, D.C. 20036
TELEPHONE: (202) 778-9000
FACSIMILE: (202) 778-9100
December 19, 1997
Neuberger & Berman Income Funds
605 Third Avenue, Second Floor
New York, New York 10158-0180
Ladies and Gentlemen:
You have requested our opinion as to certain matters regarding the
issuance by Neuberger & Berman Income Funds ("Trust") of shares of beneficial
interest ("Shares") of Neuberger & Berman Limited Maturity Bond Fund ("Limited
Maturity Bond Fund"), a series of the Trust, pursuant to a Plan of
Reorganization and Termination ("Plan") between the Trust, on behalf of Limited
Maturity Bond Fund, and the Trust on behalf of Neuberger & Berman Ultra Short
Bond Fund ("Ultra Short Bond Fund"), another series of the Trust (each a
"Fund"). In connection with the Plan, the Trust is about to file a Registration
Statement on Form N-14 to register the Shares under the Securities Act of 1933,
as amended ("1933 Act"), to be issued pursuant to the Plan.
Each Fund is a feeder fund in a master/feeder fund structure and invests
in a corresponding portfolio of Income Managers Trust. Under the Plan, Ultra
Short Bond Fund will transfer substantially all of its assets from Neuberger &
Berman Ultra Short Bond Portfolio to Neuberger & Berman Limited Maturity Bond
Portfolio, and shareholders in Ultra Short Bond Fund will receive the Shares in
exchange for their shares of Ultra Short Bond Fund.
As counsel to the Trust, we have participated in various matters of the
Trust operations and other matters relating to the Trust. We have examined
copies of the Trust Instrument and the Trust's By-Laws, as now in effect, the
form of the Plan, and the minutes of meetings of the trustees of the Trust, and
we are generally familiar with its affairs. Based upon the foregoing, it is our
opinion that the Shares of the Fund that are currently being registered may be
legally and validly issued from time to time in accordance with the Trust's
Trust Instrument and By-Laws; and, when so issued, will be legally issued, fully
paid and non-assessable by the Trust.
The Trust is a business trust established pursuant to the Delaware
Business Trust Act ("Delaware Act"). The Delaware Act provides that a
shareholder of the Trust is entitled to the same limitation of personal
liability extended to shareholders of for-profit corporations. To the extent
that the Trust or any of its shareholders becomes subject to the jurisdiction of
courts in states which do not have statutory or other authority limiting the
liability of business trust shareholders, such courts might not apply the
Delaware Act and could subject Trust shareholders to liability.
To guard against this risk, the Trust Instrument: (i) requires that
every written obligation of the Trust contain a statement that such obligation
may be enforced only against the assets of the Trust; however, the omission of
such a disclaimer will not operate to create personal liability for any
shareholder; and (ii) provides for indemnification out of Trust property of any
shareholder held personally liable, solely by reason of being a shareholder, for
the obligations of the Trust. Thus, the risk of a Trust shareholder incurring
financial loss beyond his or her investment because of shareholder liability is
limited to circumstances in which: (i) a court refuses to apply Delaware law;
(ii) no contractual limitation of liability is in effect; and (iii) the Trust
itself is unable to meet its obligations.
We express no opinion as to compliance with the Securities Act of 1933,
the Investment Company Act of 1940, or applicable state securities laws in
connection with the sale of Shares.
We hereby consent to the filing of this opinion in connection with the
Trust's Registration Statement on Form N-14. We also consent to the reference to
our firm under the caption "Miscellaneous -- Legal Matters" in the Prospectus
and Information Statement filed as part of the Registration Statement.
Sincerely,
KIRKPATRICK & LOCKHART LLP
By: /s/ Arthur C. Delibert
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Arthur C. Delibert