DEF: Neuberger Berman Funds Set 2025 Annual Meeting for Director Elections

Neuberger Berman High Yield Strategies Fund, Energy Infrastructure Fund, and Real Estate Securities Income Fund will hold a joint annual meeting on October 1, 2025, to elect Class II Directors.

Summary

• A Joint Annual Meeting of Stockholders for Neuberger Berman High Yield Strategies Fund Inc. (NHS), Neuberger Berman Energy Infrastructure and Income Fund Inc. (NML), and Neuberger Berman Real Estate Securities Income Fund Inc. (NRO) is scheduled for October 1, 2025, at 2:00 p.m. Eastern Time in New York.
• The primary purpose of the meeting is the election of four Class II Directors.
• Three Class II Directors (Michael J. Cosgrove, Deborah C. McLean, and Paul M. Nakasone) will be voted on by common and preferred stockholders (if any) together as a single class, with terms extending until the 2028 annual meeting.
• One Class II Director (Ami G. Kaplan) will be voted on separately by preferred stockholders of High Yield Strategies Fund, and by common stockholders of Energy Infrastructure Fund and Real Estate Securities Income Fund, with a term until the 2028 annual meeting.
• The Record Date for determining stockholders entitled to vote is July 17, 2025.
• The Boards of Directors recommend voting FOR all nominated directors.
• Detailed information on director qualifications, board committee structures, and risk management oversight is provided.
• Ernst & Young LLP serves as the independent registered public accounting firm for all three Funds, with audit fees for FY2024 being $69,400 for NHS, $58,700 for NML, and $44,200 for NRO.

Sentiment

Score: 7

Explanation: The filing is a routine proxy statement for director elections, indicating stable governance and a proactive approach to managing closed-end fund specific challenges. The detailed disclosure of experienced directors and robust committee structures suggests a well-managed entity, without presenting any significant positive or negative surprises.

Positives

• The Board of Directors comprises highly experienced individuals with diverse backgrounds in finance, asset management, law, and cybersecurity, overseeing a complex of 50 funds.
• Directors have a proven track record of protecting stockholder interests and have approved various actions to enhance investor value and increase competitiveness, including managing distribution rates, implementing discount mitigation measures (such as tender option programs), approving fund mergers, actively managing Fund leverage structures, and making changes to investment strategies.
• A robust corporate governance framework is in place, featuring multiple specialized committees: Audit, Closed-End Funds, Contract Review, Ethics and Compliance, Executive, Governance and Nominating, and Investment Performance.
• Independent Directors regularly convene without management present and receive counsel from experienced independent legal advisors, ensuring objective oversight.
• Three members of the Audit Committee (Michael J. Cosgrove, Martha C. Goss, and Deborah C. McLean) are qualified as financial experts, enhancing the committee's oversight capabilities.

Risks

• Investment risk
• Counterparty risk
• Valuation risk
• Liquidity risk
• Reputational risk
• Risk of operational failure or lack of business continuity
• Cybersecurity risk
• Legal, compliance and regulatory risk
• The Boards' risk management oversight is subject to substantial limitations, as not all risks can be identified, eliminated, or mitigated with certainty, and some risks (like investment-related risks) must be borne to achieve fund goals.

Future Outlook

The Boards of Directors are committed to enhancing investor value and increasing the Funds' competitiveness in the secondary market. This includes ongoing efforts to manage distribution rates, approve discount mitigation measures like tender option programs, consider fund mergers, actively manage Fund leverage structures, and adapt investment strategies to optimize investor return potential while managing risk. The election of experienced directors is intended to support these strategic objectives through 2028.

Management Comments

• "We urge you to review the information in the accompanying proxy statement and vote FOR the election of the nominees of the Board of Directors of each Fund using the enclosed proxy card(s)."
• "Each Board believes that the incumbents are well suited for service on the Board due to their knowledge and familiarity with each Fund as a result of their prior service as Directors, their knowledge of the financial services sector, and their substantial experience in serving as directors or trustees, officers, or advisers of public companies and business organizations, including other investment companies."

Industry Context

This filing is a routine proxy statement for closed-end funds, which often trade at a discount to their Net Asset Value (NAV). The Board's stated focus on addressing this discount through various measures, such as managing distribution rates, considering tender offers, and adjusting investment strategies, aligns with common industry practices aimed at enhancing shareholder value in the closed-end fund sector. The involvement of Neuberger Berman Investment Advisers LLC, a firm with approximately $538 billion in assets under management, positions these funds within a large and established asset management complex, suggesting access to significant resources and expertise.

Comparison to Industry Standards

• The Board's proactive approach to mitigating the discount of market price relative to NAV, through strategies like managing distribution rates and approving tender option programs, is a critical aspect of closed-end fund management and aligns with best practices to protect shareholder interests.
• The use of fund mergers as a potential action to enhance investor value is a recognized strategy within the closed-end fund industry for consolidation and improving market efficiency.
• The compensation structure for Independent Directors, which includes an annual retainer of $200,000 and meeting fees of $17,500, along with additional compensation for committee chairs, is typical for boards overseeing multiple funds within a large fund complex, comparable to other major asset managers.
• The detailed committee structure, including Audit, Governance and Nominating, Ethics and Compliance, and Investment Performance committees, reflects robust corporate governance standards common among regulated investment companies and is consistent with industry best practices for oversight and risk management.

Management Changes

Corporate Governance

Related Party Transactions

• Joseph V. Amato is identified as an 'interested person' due to his role as an officer of Neuberger Berman Investment Advisers LLC (NBIA) and its affiliates. He serves as a Director and officer of the Funds without compensation from the Funds.
• NBIA serves as the investment manager and administrator to each Fund.
• Ernst & Young did not provide any audit-related services, tax services, or other non-audit services to NBIA and its affiliates that the Audit Committees were required to approve pursuant to Rule 2-01(c)(7)(ii) of Regulation S-X.

Stakeholder Impact

• **Shareholders**: Will participate in the election of Class II Directors, influencing the future composition and oversight of the Funds' Boards. The Board's ongoing efforts to mitigate NAV discount and enhance investor value directly benefit shareholders.
• **Directors and Management**: The election process and compensation structure directly affect the board members and key management personnel, ensuring continuity and appropriate remuneration for their oversight responsibilities.
• **Employees of NBIA**: Employees of NBIA and its affiliates are involved in proxy solicitations and the day-to-day operations of the Funds.
• **Service Providers (e.g., Ernst & Young, EQ Fund Solutions)**: Continue to provide essential audit, tax, and proxy solicitation services, maintaining their contractual relationships with the Funds.

Next Steps

• Stockholders are urged to authorize a proxy to vote their shares in advance of the Joint Annual Meeting by October 1, 2025.
• The Joint Annual Meeting of Stockholders will be held on October 1, 2025, to elect four Class II Directors and consider any other proper business.
• Stockholders wishing to submit proposals for inclusion in the Funds' proxy material for the 2026 Annual Meeting must do so by April 27, 2026.
• Stockholders wishing to make proposals not included in proxy materials or nominate directors for the 2026 Annual Meeting must deliver notice between March 28, 2026, and April 27, 2026.

Key Dates

Recommendation

This filing is a standard proxy statement for the annual election of directors and does not contain new financial performance data or strategic shifts that would warrant a change in investment recommendation. The proposed directors are experienced, and the corporate governance structure appears robust, suggesting continued stable management of the funds. Investors should maintain their current positions while monitoring future financial reports and strategic announcements.

Keywords

Neuberger Berman, High Yield Strategies Fund, Energy Infrastructure Fund, Real Estate Securities Income Fund, NHS, NML, NRO, Proxy Statement, Annual Meeting, Director Election, Corporate Governance, Closed-End Funds, Investment Management, SEC Filing, Board of Directors, Risk Management, Audit Committee, Shareholder Vote