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<SEC-DOCUMENT>0000905148-03-000017.txt : 20030103
<SEC-HEADER>0000905148-03-000017.hdr.sgml : 20030103
<ACCEPTANCE-DATETIME>20030103171027
ACCESSION NUMBER:		0000905148-03-000017
CONFORMED SUBMISSION TYPE:	N-2
PUBLIC DOCUMENT COUNT:		25
FILED AS OF DATE:		20030103

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			ROYCE VALUE TRUST INC
		CENTRAL INDEX KEY:			0000804116
		IRS NUMBER:				133356097
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		N-2
		SEC ACT:		1933 Act
		SEC FILE NUMBER:	333-102349
		FILM NUMBER:		03503700

	BUSINESS ADDRESS:	
		STREET 1:		1414 AVE OF THE AMERICAS 9TH FL
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10019
		BUSINESS PHONE:		2123557311

	MAIL ADDRESS:	
		STREET 1:		1414 AVENUE OF THE AMERICAS
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10019

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			ROYCE VALUE TRUST INC
		CENTRAL INDEX KEY:			0000804116
		IRS NUMBER:				133356097
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		N-2
		SEC ACT:		1940 Act
		SEC FILE NUMBER:	811-04875
		FILM NUMBER:		03503701

	BUSINESS ADDRESS:	
		STREET 1:		1414 AVE OF THE AMERICAS 9TH FL
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10019
		BUSINESS PHONE:		2123557311

	MAIL ADDRESS:	
		STREET 1:		1414 AVENUE OF THE AMERICAS
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10019
</SEC-HEADER>
<DOCUMENT>
<TYPE>N-2
<SEQUENCE>1
<FILENAME>efc2-1398_formn2.txt
<TEXT>
    As filed with the Securities and Exchange Commission on January 3, 2003

                                                  Securities Act File No. 333-
                                     Investment Company Act File No. 811-04875

==============================================================================

                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549
                         ____________________________






                                FORM N-2
         REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933            /X/
                       Pre-Effective Amendment No.                          / /
                      Post-Effective Amendment No.                          / /
                                 and/or
                    REGISTRATION STATEMENT UNDER THE                        /X/
                     INVESTMENT COMPANY ACT OF 1940                         / /
                            Amendment No. 24
                      ____________________________

                            Royce Value Trust, Inc.
              (Exact Name of Registrant as Specified In Charter)
                         ____________________________

             1414 Avenue of the Americas, New York, New York 10019
                   (Address of Principal Executive Offices)

                                (800) 221-4268
             (Registrant's Telephone Number, including Area Code)

                          Charles M. Royce, President
                            Royce Value Trust, Inc.
                          1414 Avenue of the Americas
                           New York, New York 10019
                    (Name and Address of Agent for Service)
                         ____________________________

                                  Copies to:
    John E. Denneen, Esq.                             Frank P. Bruno, Esq.
   Royce Value Trust, Inc.                      Sidley Austin Brown & Wood LLP
1414 Avenue of the Americas                            787 Seventh Avenue
 New York, New York 10019                          New York, New York 10019
                         ____________________________

Approximate date of proposed public offering: As soon as practicable after the
effective date of this Registration Statement.

                         ____________________________

     If any of the securities being registered on this form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, as amended (the "Securities Act"), other than securities offered only
in connection with dividend or interest reinvestment plans, check the
following box. [x]

                         ____________________________


<TABLE>
<CAPTION>
                                      CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933
====================================================================================================================
                                                                                     Proposed
                                                                     Proposed         Maximum
                                                     Amount          Maximum         Aggregate        Amount of
                    Title of                          Being       Offering Price     Offering       Registration
          Securities Being Registered             Registered(1)    Per Unit(1)       Price(1)          Fee(2)
- --------------------------------------------------------------------------------------------------------------------
<S>                                             <C>               <C>               <C>            <C>
Common Stock ($.001 par value)..................6,362,607 shares      $13.25        $84,304,543       $7,756.02
====================================================================================================================
</TABLE>

(1)  Estimated solely for the purpose of calculating the registration fee.
(2)  Transmitted to the designated lockbox at Mellon Bank in Pittsburgh, PA.

     THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.

<PAGE>

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN
OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

                             Subject to Completion
                         Preliminary Prospectus Dated
                                January 3, 2003
                            ROYCE VALUE TRUST, INC.
                       _________ Shares of Common Stock
                  Issuable upon Exercise of Non-Transferable
              Rights to Subscribe for such Shares of Common Stock

     Royce Value Trust, Inc. is offering to its Common Stockholders of record
as of January 28, 2003 non-transferable Rights. These Rights will allow you to
subscribe for one (1) share of Common Stock for each ten (10) Rights held. You
will receive one Right for each whole share of Common Stock that you hold of
record as of January 28, 2003, rounded up to the nearest number of Rights
evenly divisible by ten. The Rights will not be listed for trading on the New
York Stock Exchange ("NYSE") or any other exchange. THE SUBSCRIPTION PRICE
WILL BE THE LOWER OF (I) $0.50 BELOW THE LAST REPORTED SALE PRICE OF A SHARE
OF THE FUND'S COMMON STOCK ON THE NYSE ON THE PRICING DATE, WHICH IS MARCH 11,
2003 OR (II) THE NET ASSET VALUE OF A SHARE OF THE FUND'S COMMON STOCK ON THAT
DATE.

     RIGHTS MAY BE EXERCISED AT ANY TIME UNTIL 5:00 P.M., EASTERN TIME, ON
MARCH 10, 2003, UNLESS EXTENDED. SINCE THE OFFER CLOSES PRIOR TO THE PRICING
DATE, STOCKHOLDERS WHO EXERCISE THEIR RIGHTS WILL NOT KNOW THE SUBSCRIPTION
PRICE AT THE TIME THEY EXERCISE THEIR RIGHTS.

     The Fund is a closed-end investment company, whose shares of Common Stock
are listed and traded on the NYSE under the symbol "RVT." The Fund's primary
investment goal is long-term capital growth. The Fund normally invests at
least 75% of its assets in the equity securities of small- and micro-cap
companies. The net asset value per share of the Fund's Common Stock at the
close of business on February ___, 2003 was $_____, and the last reported
sales price of a share of the Fund's Common Stock on the NYSE on that date was
$_____.

     This Prospectus contains information you should know before investing,
including information about risks. Please read it before you invest and keep
it for future reference.

     Stockholders who do not fully exercise their Rights will own a smaller
proportional interest in the Fund. In addition, because the Subscription Price
may be less than the net asset value per share as of the Pricing Date, the
Offer may result in an immediate dilution of the net asset value per share for
all stockholders. See "Risk Factors and Special Considerations at a Glance" on
page 5 of this Prospectus.

                                                       Per Share          Total
Estimated Subscription Price(1)                            $                $
Sales load                                                None            None
Proceeds, before expenses, to the Fund(2)(3)               $                $

(1)  Based on $0.50 below the last reported sale price of the Fund's Common
     Stock of $____ on the NYSE on February ___, 2003.
(2)  Before deduction of expenses payable by the Fund, estimated at $200,000,
     which will be charged against paid-in capital of the Fund.
(3)  If the Fund increases the number of shares subject to subscription by
     20%, the Proceeds, before expenses, to the Fund will be $___________.

     The Fund may increase the number of shares of Common Stock subject to
subscription by up to 20%, or up to an additional ____________ Shares, for an
aggregate total of ____________ Shares.

     Neither the Securities and Exchange Commission ("SEC") nor any state
securities commission has approved or disapproved of these securities or
determined if this Prospectus is truthful or complete. Any representation to
the contrary is a criminal offense.

     The Shares will be ready for delivery on or about March 31, 2003.

                             ____________________

               The date of this Prospectus is January __, 2003.

<PAGE>

     Information about the Fund can be reviewed and copied at the SEC's Public
Reference Room in Washington, D.C. Call 1-202-942-8090 for information on the
operation of the Public Reference Room. This information is also available on
the SEC's Internet site at http://www.sec.gov, and copies may be obtained upon
payment of a duplicating fee by writing the Public Reference Section of the
SEC, Washington, D.C. 20549-0102.



                                      2
<PAGE>

                              PROSPECTUS SUMMARY

     You should consider the matters discussed in this summary before
investing in the Fund through the Offer. This summary is qualified in its
entirety by reference to the detailed information included in this Prospectus
and the related Statement of Additional Information.

                             THE OFFER AT A GLANCE

The Offer

     The Fund is offering to its Common Stockholders of record as of January
28, 2003 non-transferable Rights. These Rights will allow you to subscribe for
one (1) share of Common Stock for each ten (10) Rights held. You will receive
one Right for each whole share of Common Stock that you hold of record as of
January 28, 2003, rounded up to the nearest number of Rights evenly divisible
by ten. The Rights will not be listed for trading on the NYSE or any other
exchange. Rights may be exercised at any time from February 10, 2003 through
5:00 p.m., Eastern time, on March 10, 2003, unless extended. Since the
Expiration Date is prior to the Pricing Date, stockholders who exercise their
Rights will not know the Subscription Price at the time they exercise their
Rights. The Fund may increase the number of shares of Common Stock subject to
subscription by up to 20% of the Shares (any such additional Shares are
referred to as "Additional Shares"). See "The Offer."

Subscription Price

     The Subscription Price will be the lower of (i) $0.50 below the last
reported sale price of a share of the Fund's Common Stock on the NYSE on the
Pricing Date or (ii) the net asset value of a share of the Fund's Common Stock
on that date. See "The Offer -- Subscription Price."

Over-Subscription Privilege

     If you fully exercise all Rights issued to you, you will be entitled to
subscribe for additional Shares that were not subscribed for by other
stockholders. If sufficient Shares are available, all stockholders'
over-subscription requests will be honored in full. If these requests for
additional Shares exceed the Shares available, the available Shares, including
any Additional Shares, will be allocated pro rata among stockholders who
over-subscribe based on the number of Rights originally issued to them by the
Fund. See "The Offer -- Over-Subscription Privilege."

Use of Proceeds

     We estimate the net proceeds of the Offer to be approximately $________
($_____ if all of the Additional Shares are available for subscription). These
figures assume (i) all Rights are exercised in full, (ii) a Subscription Price
of $________ and (iii) payment of offering expenses of approximately $200,000.

     Royce & Associates, LLC ("Royce"), the Fund's investment adviser,
anticipates that investment of the net proceeds of the Offer in accordance
with the Fund's investment goal and policies will take up to six months from
their receipt by the Fund, depending on market conditions and the availability
of appropriate securities. See "Use of Proceeds."

Obtaining Subscription Information

     If you have any questions or requests for assistance, please contact
Georgeson Shareholder Communications, Inc., the Information Agent, (toll free)
at (866) 328-5443. You may also call the Fund (toll free) at (800) 221-4268,
or contact your broker or Nominee for information with respect to the Offer.
See "The Offer -- Information Agent."



                                      3
<PAGE>

<TABLE>
<CAPTION>
                                      Important Dates to Remember

                                Event                                         Date
                                -----                                         ----

<S>                                                                     <C>
Record Date.......................................................      January 28, 2003
Subscription Period...............................................      February 10, 2003 through March 10, 2003*
Expiration Date...................................................      March 10, 2003*
Pricing Date......................................................      March 11, 2003*
Nominee Subscription Certificate and Payment for Shares Due
   Pursuant to Notice of Guaranteed Delivery......................      March 13, 2003*
Confirmation to Participants......................................      March 18, 2003*
Final Payment for Shares..........................................      March 28, 2003*
</TABLE>

*Unless the Offer is extended.

Tax Consequences

     For Federal income tax purposes, neither the receipt nor the exercise of
the Rights will result in taxable income to you. You will not realize a
taxable loss if your Rights expire without being exercised. See "The Offer --
Federal Income Tax Consequences of the Offer."

                             THE FUND AT A GLANCE

The Fund

     The Fund is a closed-end investment company.

Investment Goal and Policies

     The Fund's primary investment goal is long-term capital growth. Royce
normally invests more than 75% of the Fund's assets in the equity securities
of small- and micro-cap companies, generally with stock market capitalizations
ranging from $100 million to $2 billion, that Royce believes are trading
significantly below its estimate of their current worth. The Fund may also
invest up to 25% of its assets in non-convertible fixed income securities. An
investment in the Fund is not appropriate for all investors. There can be no
assurance that the Fund's investment goal will be realized. See "Investment
Goal and Policies."

Capital Stock

     The Fund's Common Stock is listed and traded on the NYSE. The Fund also
has 2,400,000 shares of 7.80% Cumulative Preferred Stock and 4,000,000 shares
of 7.30% Tax-Advantaged Cumulative Preferred Stock issued and outstanding. The
Fund's Preferred Stock has an aggregate liquidation preference of $160
million. See "Description of Capital Stock."

Distributions

     The Fund's policy is to make quarterly distributions to its Common
Stockholders at the annual rate of 9% of the rolling average of the prior four
calendar quarter-end net asset values of the Fund's Common Stock, with the
fourth quarter distribution being the greater of 2.25% of the rolling average
or the distribution required by Internal Revenue Service regulations. These
quarterly distributions are generally reinvested in additional full and
fractional shares of Common Stock through the Fund's Dividend Reinvestment and
Cash Purchase Plan. The Fund's quarterly distribution policy may be changed by
the Board of Directors without stockholder approval. See "Dividends,
Distributions and Reinvestment Plan."



                                      4
<PAGE>

Investment Adviser

     Royce provides investment advisory services to the Fund. For its
services, the Fund pays Royce a monthly fee at a rate ranging from 0.5% to
1.5% per annum of the Fund's average net assets (including assets obtained
from the sale of Preferred Stock) for rolling 60 month periods based on the
investment performance of the Fund relative to the investment record of the
Standard & Poor's 600 SmallCap Stock Price Index, over such periods. See
"Investment Advisory and Other Services."

              RISK FACTORS AND SPECIAL CONSIDERATIONS AT A GLANCE

Dilution - Net Asset Value and Non-Participation in the Offer

     If you do not fully exercise your Rights, you should expect that you
will, at the completion of the Offer, own a smaller proportional interest in
the Fund than would otherwise be the case had you exercised your Rights.
Further, if you do not submit a subscription request pursuant to the
Over-Subscription Privilege, you may also experience dilution in your Fund
ownership if the Fund offers Additional Shares for subscription. The Fund may
sell Additional Shares to stockholders if and to the extent that shares issued
through the Offer would dilute (reduce) the net asset value of its Common
Stock by less than 1.0%. We cannot state precisely the amount of any decrease
because we do not know at this time how many Shares will be subscribed for or
what the net asset value or market price per Share will be at the Pricing
Date. As of February ___, 2003, the Fund's shares traded at a ___% [premium
above] [discount from] net asset value. If the Fund's shares trade at a
premium above net asset value as of the Pricing Date, the Fund estimates that
such dilution would be minimal. See "The Offer."

Market Risk

     As with any investment company that invests in common stocks, the Fund is
subject to market risk -- the possibility that common stock prices will
decline over short or extended periods of time. As a result, the value of an
investment in the Fund's Common Stock will fluctuate with the market, and you
could lose money over short or long periods of time.

Small- and Micro-Cap Risk

     The prices of small- and micro-cap companies are generally more volatile
and their markets are generally less liquid relative to larger-cap companies.
Therefore, the Fund may involve more risk of loss and its returns may differ
significantly from funds investing in larger-cap companies or other asset
classes. See "Investment Goal and Policies -- Special Considerations -
Investing in Small- and Micro-Cap companies."

Selection Risk

     Different types of stocks tend to shift into and out of favor with stock
market investors, depending on market and economic conditions. The performance
of funds that invest in value-style stocks may at times be better or worse
than the performance of stock funds that focus on other types of stocks or
that have a broader investment style.

Market Price of Shares

     Although the Fund's shares of Common Stock have recently traded on the
NYSE at a market price above their net asset value (a premium), the Fund's
shares have traded in the market below (a discount), at and above net asset
value since the commencement of the Fund's operations. There can be no
assurance that the Fund's shares will trade at a premium in the future, or
that any such premium is sustainable. The Fund's shares have traded at
discounts of as much as ___% in the past ___ years. Market price risk is a
risk separate and distinct from the risk that the Fund's net asset value will
decrease. In the year ended December 31, 2002, the Fund's shares traded in the
market at an average [discount to] [premium above] net asset value of ____%.
As of December 31, 2002, the [discount to] [premium above] net asset value was
____%.



                                      5
<PAGE>

Leverage and Borrowing

       The Fund is authorized to borrow money. So long as the Issued Preferred
is rated by Moody's, the Fund cannot borrow for investment leverage purposes.
Borrowings create an opportunity for greater capital appreciation with respect
to the Fund's investment portfolio, but at the same time such borrowing is
speculative in that it will increase the Fund's exposure to capital risk. In
addition, borrowed funds are subject to interest costs that may offset or
exceed the return earned on the borrowed funds. See "Investment Goal and
Policies -- Risks to Common Stockholders of Borrowing Money and Issuing Senior
Securities."

Preferred Stock - Leverage Risk

     The leverage resulting from the issuance of Preferred Stock creates risks
for holders of Common Stock, including higher volatility of both the net asset
values and market prices of the Common Stock. If the Fund is able to realize a
net return on its investment portfolio in excess of the then current dividend
rate of the Preferred Stock, the effect of leverage permits holders of Common
Stock to realize a higher current rate of return than if the Fund were not
leveraged. On the other hand, if the current dividend rate on the Preferred
Stock exceeds the net return on the Fund's investment portfolio, the Fund's
leveraged capital structure will result in a lower rate of return to holders
of Common Stock than if the Fund were not leveraged. Similarly, because any
decline in the value of the Fund's investments will be borne entirely by
holders of Common Stock, the effect of leverage in a declining market results
in a greater decrease in net asset value to holders of Common Stock than if
the Fund were not leveraged, which would likely be reflected in a greater
decline in the market price for shares of Common Stock. See "Investment Goal
and Policies -- Risks to Common Stockholders of Borrowing Money and Issuing
Senior Securities." Leveraging through the issuance of Preferred Stock
requires that the holders of the Preferred Stock have class voting rights on
various matters that could make it more difficult for the holders of the
Common Stock to change the investment goal or other fundamental policies of
the Fund, to convert the Fund to an open-end fund or make certain other
changes. See "Investment Goal and Policies -- Changes in Investment Goal and
Methods/Policies" and "Description of Capital Stock -- Certain Corporate
Governance Provisions."

     Because Royce's fee is partially based on the average net assets of the
Fund (including assets obtained from the sale of Preferred Stock), Royce has
generally benefited from the Fund's issuance of the Issued Preferred. See
"Investment Advisory and Other Services -- Advisory Fee."

Certain Corporate Governance Provisions

     The six Fund Directors who are elected by the holders of Common Stock and
Preferred Stock voting together are divided into three classes, each having a
staggered term of three years. The two Directors elected only by the holders
of Preferred Stock stand for election at each annual meeting of stockholders.
Accordingly, it likely would take three years to change a majority of the
Board of Directors. Vacancies on the Board of Directors for one or more of the
six classified positions may be filled by the remaining Directors for the
balance of the term of the class. In addition, the Fund's By-laws permit
stockholders to call a special meeting of stockholders only if certain
procedural requirements are met and the request is made by stockholders
entitled to cast at least a majority of the votes entitled to be cast at such
a meeting. These provisions may have the effect of maintaining the continuity
of management and thus may make it more difficult for the Fund's stockholders
to change the majority of Directors. See "Description of Capital Stock --
Certain Corporate Governance Provisions."



                                      6
<PAGE>

                                 FUND EXPENSES

     The following tables are intended to assist investors in understanding
the various costs and expenses that a stockholder of the Fund will bear,
directly or indirectly.

<TABLE>
<CAPTION>
<S>                                                                                               <C>
Stockholder Transaction Expenses
     Sales Load....................................................................                      None
     Distribution Reinvestment and Cash Purchase Plan Fees ........................                      None

Annual Expenses (as a percentage of average net assets attributable
   to the Fund's Common Stock, and estimated for the year ending
   December 31, 2003)
     Investment Advisory Fees(1)(2)................................................                           %
     Interest Payments on Borrowed Funds...........................................                      None
     Other Expenses(1).............................................................                           %
                                                                                                  --------------------
         Total Annual Expenses(1)(3)...............................................                           %
                                                                                                  ====================
</TABLE>

____________________
(1)  Assumes the Issued Preferred remains outstanding for the year ending
     December 31, 2003. See "Risk Factors and Special Considerations at a
     Glance - Preferred Stock - Leverage Risk." If the Fund redeems the Issued
     Preferred, it is estimated that, as a percentage of net assets
     attributable to Common Stock, the Investment Advisory Fees would be 1.0%,
     Other Expenses would be _____% and Total Annual Expenses would be _____%.
(2)  The Investment Advisory Fees shown in the above table represent only the
     Basic Fee. The Investment Advisory Fees (as a percentage of average net
     assets attributable to the Fund's Common Stock) may be as low as ___% or
     as high as ___%, based on the Fund's relative investment performance. See
     "Investment Advisory and Other Services--Advisory Fee."
(3)  The indicated _____% expense ratio assumes that the Offer (including the
     Over-Subscription Privilege) is fully subscribed and assumes estimated
     net proceeds from the Offer of approximately $____ million (assuming an
     estimated Subscription Price of $____).

Example

     The following Example demonstrates the projected dollar amount of total
cumulative expense that would be incurred over various periods with respect to
a hypothetical investment in the Fund's Common Stock. These amounts are based
upon payment by the Fund of investment advisory fees and other expenses at the
levels set forth in the above table.

     An investor would directly or indirectly pay the following expenses on a
$1,000 investment in shares of the Fund's Common Stock, assuming (i) the
market price at the time of investment was equal to the net asset value
("NAV") per share, (ii) a 5% annual return and (iii) reinvestment of all
distributions at NAV:

      One Year           Three Years        Five Years          Ten Years
         $                    $                  $                  $

     This Example assumes that the percentage amounts listed under Annual
Expenses remain the same in the years shown. The above tables and the
assumption in the Example of a 5% annual return and reinvestment at NAV are
required by regulation of the SEC and are applicable to all investment
companies, and the assumed 5% annual return is not a prediction of, and does
not represent, the projected performance of the Fund's Common Stock. Actual
expenses and annual rates of return may be more or less than those allowed for
purposes of this Example. In addition, while the Example assumes reinvestment
of all distributions at NAV, the Fund's Distribution Reinvestment and Cash
Purchase Plan contemplates payment of net investment income dividends and
capital gain distributions in shares of the Fund's Common Stock (unless a
stockholder elects to receive payments in cash), based on the lower of the
market price or NAV on the valuation date, except that distributions may not
be reinvested for less than 95% of the market price.

     THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF FUTURE
EXPENSES. THE FUND'S ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN.



                                      7
<PAGE>

                             FINANCIAL HIGHLIGHTS

     The financial highlights table is intended to help you understand the
Fund's financial performance for the periods presented and reflects financial
results for a single Fund share. The total returns in the table represent the
rate that an investor would have earned on an investment in the Fund (assuming
reinvestment of all dividends and distributions and full primary participation
in all rights offerings). The information for the six months ended June 30,
2002 has not been audited. The information for each of the four years in the
period ended December 31, 2001 has been audited by Tait, Weller & Baker, whose
report, along with the Fund's financial statements, is included in the Fund's
2001 Annual Report to Stockholders, which is available upon request. The
information for the years ended December 31, 1997, 1996 and 1995 has been
audited by Ernst & Young LLP, independent accountants, as stated in their
unqualified report accompanying such financial statements.

<TABLE>
<CAPTION>
                                             Six months ended
                                              June 30, 2002                              Years ended December, 31
                                                                 ------------------------------------------------------------------
                                               (unaudited)          2001            2000          1999         1998        1997
                                            ------------------   ------------    -----------   -----------   ---------   --------
<S>                                         <C>                  <C>             <C>           <C>           <C>         <C>
NET ASSET VALUE, BEGINNING OF
PERIOD                                           $17.31            $16.56          $15.77        $15.72       $16.91      $14.32

INVESTMENT OPERATIONS(a):
  Net investment income (loss)                    (0.01)             0.05            0.18          0.26         0.17        0.21
  Net realized and unrealized gain on
  investments                                      0.18              2.58            2.58          1.65         0.67        3.85
                                            ---------------------------------------------------------------------------------------
    Total investment operations                    0.17              2.63            2.76          1.91         0.84        4.06
                                            ---------------------------------------------------------------------------------------

DISTRIBUTIONS TO PREFERRED
STOCKHOLDERS:
  Net investment income                            -                (0.01)          (0.03)        (0.04)       (0.03)      (0.03)
  Net realized gain on investments                 -                (0.30)          (0.30)        (0.32)       (0.26)      (0.15)
  Quarterly distributions*                        (0.15)              -               -             -            -           -
                                            ---------------------------------------------------------------------------------------
    Total distributions to Preferred
    Stockholders                                  (0.15)            (0.31)          (0.33)        (0.36)       (0.29)      (0.18)
                                            ---------------------------------------------------------------------------------------

DISTRIBUTIONS TO COMMON
STOCKHOLDERS:
  Net investment income                            -                (0.05)          (0.13)        (0.15)       (0.16)      (0.19)
  Net realized gain on investments                 -                (1.44)          (1.35)        (1.22)       (1.38)      (1.02)
  Quarterly distributions*                        (0.76)             -                -             -            -           -
                                            ---------------------------------------------------------------------------------------
     Total distributions to Common
     Stockholders                                 (0.76)            (1.49)          (1.48)        (1.37)       (1.54)      (1.21)
                                            ---------------------------------------------------------------------------------------

CAPITAL STOCK TRANSACTIONS:
  Effect of reinvestment of distributions by
    Common Stockholders                           (0.02)            (0.08)          (0.16)        (0.13)       (0.09)      (0.08)
  Effect of Rights offering                        -                 -               -              -            -           -
  Effect of Preferred Stock offering               -                 -               -              -          (0.11)        -
                                            ---------------------------------------------------------------------------------------
    Total capital stock transactions              (0.02)            (0.08)          (0.16)        (0.13)       (0.20)      (0.08)
                                            ---------------------------------------------------------------------------------------

NET ASSET VALUE, END OF PERIOD(a)                $16.55            $17.31          $16.56        $15.77       $15.72      $16.91
                                            =======================================================================================

MARKET VALUE, END OF PERIOD                      $16.55            $15.72          $14.38        $13.063      $13.75      $15.063
                                            =======================================================================================

TOTAL RETURN(b):
Net Asset Value (a)                                0.0%***           15.2%          16.6%         11.7%         3.3%       27.5%
Market Value                                      10.1%***           20.0%          22.7%          5.7%         1.5%       28.8%

RATIOS BASED ON AVERAGE NET
ASSETS APPLICABLE TO COMMON
STOCKHOLDERS:
Total expenses (c, d)                              1.61%**           1.61%          1.43%         1.39%        1.31%       1.12%
  Management fee expense                           1.48%**           1.45%          1.25%         1.18%        1.10%       0.39%
  Interest expense                                   -                 -              -             -            -         0.45%
  Other operating expenses                         0.13%**           0.16%          0.18%         0.21%        0.21%       0.28%
Net investment income (loss)                      (0.14)%**          0.35%          1.18%         1.47%        1.11%       1.53%

SUPPLEMENTAL DATA:
Net Assets; End of Period (in thousands)        $838,661         $849,141       $783,262      $712,928     $676,963    $554,231
Portfolio Turnover Rate                              15%              30%            36%           41%          43%         29%

PREFERRED STOCK:
Total shares outstanding                       6,400,000        6,400,000      6,400,000     6,400,000    6,400,000   2,400,000
Asset coverage per share                         $131.04          $132.68        $122.38       $111.40      $105.78     $165.51
Liquidation preference per share                  $25.00           $25.00         $25.00        $25.00       $25.00      $25.00
Average market value per share:
  7.80% Cumulative (e)                            $26.36           $25.70         $23.44        $24.98       $25.91      $25.70
  7.30% Tax-Advantaged Cumualtive (e)             $25.83           $25.37         $22.35        $24.24       $25.43        -

NOTES:
Total amount outstanding (in thousands)             -                 -             -             -            -        $27,801
Asset coverage per note                             -                 -             -             -            -      $2,090.59
Average market value per note (e)                   -                 -             -             -            -        $107.69
- ------------------------------------

<CAPTION>



                                            ----------------------------------------------------------------
                                                1996       1995        1994         1993            1992
                                             ----------  ---------  ----------   ------------     ----------
<S>                                          <C>         <C>        <C>          <C>              <C>
NET ASSET VALUE, BEGINNING OF
PERIOD                                         $13.56     $12.34      $13.47       $12.50          $11.23

INVESTMENT OPERATIONS(a):
  Net investment income (loss)                   0.26       0.04        0.04         0.09           0.15
  Net realized and unrealized gain on
  investments                                    1.92       2.70        0.09         2.12           2.12
                                            ----------------------------------------------------------------
    Total investment operations                  2.18       2.74        0.13         2.21           2.27
                                            ----------------------------------------------------------------

DISTRIBUTIONS TO PREFERRED
STOCKHOLDERS:
  Net investment income                         (0.01)       -           -             -             -
  Net realized gain on investments              (0.06)       -           -             -             -
  Quarterly distributions*                        -          -           -             -             -
                                            ----------------------------------------------------------------
    Total distributions to Preferred
    Stockholders                                (0.07)       -           -             -             -
                                            ----------------------------------------------------------------

DISTRIBUTIONS TO COMMON
STOCKHOLDERS:
  Net investment income                         (0.15)     (0.03)      (0.01)       (0.09)         (0.15)
  Net realized gain on investments              (1.00)     (1.26)      (1.04)       (1.06)         (0.75)
  Quarterly distributions*                        -          -           -             -             -
                                            ----------------------------------------------------------------
     Total distributions to Common
     Stockholders                               (1.15)     (1.29)      (1.05)       (1.15)         (0.90)
                                            ----------------------------------------------------------------

CAPITAL STOCK TRANSACTIONS:
  Effect of reinvestment of distributions by
    Common Stockholders                         (0.11)     (0.11)      (0.07)+      (0.01)         (0.04)
  Effect of Rights offering                       -        (0.12)      (0.14)       (0.08)         (0.06)
  Effect of Preferred Stock offering            (0.09)       -           -            -               -
                                            ----------------------------------------------------------------
    Total capital stock transactions            (0.20)     (0.23)      (0.21)       (0.09)         (0.10)
                                            ----------------------------------------------------------------

NET ASSET VALUE, END OF PERIOD(a)              $14.32     $13.56      $12.34       $13.47         $12.50

                                            ================================================================
MARKET VALUE, END OF PERIOD                    $12.25     $11.875     $11.00       $12.875        $12.25
                                            ================================================================

TOTAL RETURN(b):
Net Asset Value (a)                             15.5%      22.6%        1.1%         17.9%         19.9%
Market Value                                    16.3%      20.5%       -5.6%         14.8%         26.8%

RATIOS BASED ON AVERAGE NET
ASSETS APPLICABLE TO COMMON
STOCKHOLDERS:
Total expenses (c, d)                           1.28%      2.01%       2.01%         1.33%         0.81%
  Management fee expense                        0.39%      0.97%       1.21%         1.09%         0.53%
  Interest expense                              0.64%      0.75%       0.46%          -               -
  Other operating expenses                      0.25%      0.29%       0.34%         0.24%         0.28%
Net investment income (loss)                    1.27%      0.34%       0.31%         0.74%         1.31%

SUPPLEMENTAL DATA:
Net Assets; End of Period (in thousands)    $441,837   $338,970     $269,032      $246,558      $202,483
Portfolio Turnover Rate                          34%        32%          35%           33%           40%

PREFERRED STOCK:
Total shares outstanding                   2,400,000        -            -             -             -
Asset coverage per share                     $120.15        -            -             -             -
Liquidation preference per share              $25.00        -            -             -             -
Average market value per share:
  7.80% Cumulative (e)                        $25.20        -            -             -             -
  7.30% Tax-Advantaged Cumualtive (e)            -          -            -             -             -

NOTES:
Total amount outstanding (in thousands)      $40,000    $40,000      $40,000           -             -
Asset coverage per note                    $1,201.51    $944.35      $768.67           -             -
Average market value per note (e)            $100.68     $96.62       $95.62           -             -
- ------------------------------------

</TABLE>



                                                                 8
<PAGE>

(a)  Commencing June 21, 1995 through December 31, 1997, Net Asset Value per
     share, Net Asset Value Total Returns and Income from Investment
     Operations were calculated assuming that the then outstanding convertible
     notes had been fully converted, except when the effect of doing so
     resulted in a higher Net Asset Value per share than would have been
     calculated without such assumption. If it were not assumed that the Notes
     had been converted, the Net Asset Value per share would have been
     increased by $0.31 at December 31, 1997, $0.17 at December 31, 1996 and
     $0.09 at December 31, 1995.
(b)  The Net Asset Value and Market Value Total Returns assume a continuous
     Common Stockholder who reinvested all net investment income dividends and
     capital gain distributions and fully participated in primary rights
     offerings.
(c)  Expense ratios based on total average net assets were 1.32%, 1.30%,
     1.12%, 1.06%, 1.06%, 0.99%, 1.20%, 2.01%, 2.01%, ___% and ___% for the
     period ended June 30, 2002 and years ended December 31, 2001, 2000, 1999,
     1998, 1997, 1996, 1995, 1994, 1993 and 1992, respectively.
(d)  Expense ratios based on average net assets applicable to Common
     Stockholders before waiver of fees by Royce would have been 1.65%, 1.51%,
     1.48%, 1.34%, 1.14%, 1.31%, 2.04% and 2.02% for the periods ended
     December 31, 2001, 2000, 1999, 1998, 1997, 1996, 1995 and 1994,
     respectively.
(e)  The average of month-end market values during the period.
*    To be allocated to net investment income and capital gains at year-end.
**   Annualized.
***  Not annualized.
+    Includes distributions paid January 31, 1994 and December 30, 1994.



                                       9
<PAGE>

                            INVESTMENT PERFORMANCE

     The table below presents average annual total returns of the Fund's
Common Stock on two separate bases. The NAV Return is the compound average
annual rate of return, using NAVs, on an amount invested in the Fund from the
beginning to the end of the stated period and assumes: (i) reinvestment of net
investment income dividends and capital gains distributions and (ii) primary
participation in rights offerings. Historically, stockholders have been able
to reinvest distributions and purchase shares through rights offerings at
prices below NAV and without commission costs. Market Value Return presents
the same information, but values the Fund at market rather than NAV and,
therefore, reflects the actual experience of a stockholder, before commission
costs, who bought and sold shares of the Fund at the beginning and ending
dates.

     The record of the S&P 600 SmallCap Stock Price Index ("S&P 600 Index")
has been included so that the Fund's results may be compared with an unmanaged
index reflecting 600 domestic stocks chosen by Standard & Poor's for market
size, liquidity (bid-asked spread, ownership, share turnover and number of no
trade days) and industry group representation. The S&P 600 Index is a
market-value weighted index (stock price times the number of shares
outstanding), with each stock's weight in the Index proportionate to its
market value. The record of the Russell 2000 Index has been included so that
the Fund's results may be compared with an unmanaged index reflecting the
performance of the 2,000 smallest companies in the Russell 3000 Index (which
represent the 3,000 largest U.S. companies based on total market
capitalization). As of the latest reconstitution by Russell, the average
market capitalization of companies included in the Russell 2000 Index was
approximately $490 million, their median market capitalization was
approximately $395 million and the Index had a total market capitalization
range of approximately $1.3 billion to $128 million. The Fund primarily
invests in small- and micro-cap companies. The figures for each Index assume
reinvestment of dividends.

<TABLE>
<CAPTION>
                                                               Average Annual Total Returns

                                                                                                         From November
                                                                                                            28, 1986
                          Three Months     Six Months    Twelve Months     Thirty-Six     Sixty Months    (inception)
                             Ended           Ended           Ended        Months Ended       Ended             to
                          December 31,    December 31,    December 31,    December 31,    December 31,    December 31,
                            2002(%)         2002(%)         2002(%)         2002(%)         2002(%)         2002(%)
                       ----------------   ------------   -------------    ------------    ------------    ------------
<S>                     <C>               <C>           <C>               <C>             <C>             <C>
Fund NAV Return

Fund Market Value
Return

S&P 600 Index

Russell 2000 Index
</TABLE>

     It should be noted that the NAV Return for the period from November 28,
1986 through December 31, 2002 is based on the Fund's initial NAV of $9.30 per
share, rather than the initial public offering price of $10.00 per share.
Accordingly, that figure does not reflect underwriting commissions and
discounts or expenses of the offering paid by stockholders who purchased the
Fund's shares in the initial public offering.

     The above results represent past performance and should not be considered
an indication of future performance from an investment in the Fund today. They
are provided only to give an historical perspective of the Fund. The
investment return and net asset and market prices will fluctuate, so that
shares of Common Stock may be worth more or less than their original cost when
sold.



                                      10
<PAGE>

                                   THE OFFER

Terms of the Offer

     The Fund is offering to stockholders of record ("Stockholders") as of the
close of business on January 28, 2003 (the "Record Date") non-transferable
rights (the "Rights") to subscribe for an aggregate of ________ shares of
Common Stock (the "Shares") of the Fund. The Fund may increase the number of
shares of Common Stock subject to subscription by up to 20% of the Shares, or
up to ___________ Additional Shares, for an aggregate total of ___________
Shares. However, the Fund may sell Additional Shares to Stockholders if and
to the extent that shares issued through the Offer would dilute (reduce) the
net asset value of its Common Stock by less than 1.0%.

     Each Stockholder is being issued one (1) Right for each whole share of
Common Stock owned on the Record Date. The Rights entitle a Stockholder to
acquire at the Subscription Price one (1) Share for each ten (10) Rights held,
rounded up to the nearest number of Rights evenly divisible by ten (the
"Offer"). Fractional Shares will not be issued upon the exercise of Rights. In
the case of shares held of record by a broker-dealer, bank or other financial
intermediary (each, a "Nominee"), the number of Rights issued to such Nominee
will be adjusted to permit rounding up (to the nearest number of Rights evenly
divisible by ten) of the Rights to be received by each of the beneficial
owners for whom it is the holder of record only if the Nominee provides to the
Fund, on or before the close of business on _________, 2003, a written
representation of the number of Rights required for such rounding.

     Rights may be exercised at any time during the Subscription Period, which
commences on February 10, 2003 and ends as of 5:00 p.m., Eastern time, on
March 10, 2003, unless extended by the Fund (such date, as it may be extended,
is referred to in this Prospectus as the "Expiration Date"). A Stockholder's
right to acquire one (1) additional Share for each ten (10) Rights held during
the Subscription Period at the Subscription Price is referred to as the
"Primary Subscription." The Rights are evidenced by Subscription Certificates,
which will be mailed to Stockholders.

     In addition, any Stockholder who fully exercises all Rights issued to him
or her is entitled to subscribe for additional Shares, which were not
otherwise subscribed for in the Primary Subscription, at the Subscription
Price (the "Over-Subscription Privilege"). Shares acquired pursuant to the
Over-Subscription Privilege are subject to allotment and may be subject to
increase, which is more fully discussed below under "The
Offer--Over-Subscription Privilege."

     The Subscription Price will be the lower of (i) $0.50 below the last
reported sale price of a share of the Fund's Common Stock on the NYSE on March
11, 2003 (the "Pricing Date") or (ii) the net asset value ("NAV") of a share
of the Fund's Common Stock on the Pricing Date. Since the time of the close of
the Offer on the Expiration Date is prior to the Pricing Date, holders who
choose to exercise their Rights will not know the Subscription Price at the
time they exercise their Rights.

     The Rights are non-transferable. Therefore, only the underlying Shares,
and not the Rights, will be listed for trading on the NYSE.

Purposes of the Offer

     The Board of Directors of the Fund has determined that it would be in the
best interests of the Fund and its stockholders to continue to increase the
assets of the Fund available for current and future investment opportunities.
In addition, the Offer seeks to reward the long-term stockholder by giving
existing Stockholders Rights to purchase additional Shares at a price below
market price. Increasing the size of the Fund also might result in lowering
the Fund's expenses as a percentage of average net assets. Royce expects to
take up to six months from the Fund's receipt of the proceeds of the Offer
following the Expiration Date to fully invest them in accordance with the
Fund's investment goal and policies.

     The Subscription Price will be determined the first business day
subsequent to the Expiration Date in order to ensure that the Offer will
attract the maximum participation of Stockholders with the minimum dilution to
non-participating Stockholders.



                                      11
<PAGE>

     The Fund's Board of Directors voted unanimously to approve the terms of
the Offer. Two of the Fund's Directors who voted to authorize the Offer are
affiliated with Royce and, therefore, could benefit indirectly from the Offer.
The other six directors are not "interested persons" of the Fund within the
meaning of the Investment Company Act of 1940, as amended (the "1940 Act").
Royce may also benefit from the Offer because its fee is partially based on
the net assets of the Fund. See "Investment Advisory and Other
Services--Advisory Fee." It is not possible to state precisely the amount of
additional compensation Royce might receive as a result of the Offer because
it is not known how many Shares will be subscribed for and because the
proceeds of the Offer will be invested in additional portfolio securities,
which will fluctuate in value.

     The Fund may, in the future, choose to make additional rights offerings
from time to time for a number of shares and on terms that may or may not be
similar to this Offer. Any such future rights offerings will be made in
accordance with the then applicable requirements of the 1940 Act and the
Securities Act of 1933, as amended.

     There can be no assurance that the Fund or its stockholders will achieve
any of the foregoing objectives or benefits through the Offer.

Over-Subscription Privilege

     If some Stockholders do not exercise all of the Rights initially issued
to them, any Shares for which subscriptions have not been received from
Stockholders will be offered by means of the Over-Subscription Privilege to
those Stockholders who have exercised all of the Rights initially issued to
them and who wish to acquire additional Shares. Stockholders who exercise all
of the Rights initially issued to them should indicate on the Subscription
Certificate how many Shares they are willing to acquire through this
Over-Subscription Privilege. If sufficient Shares remain after completion of
the Primary Subscription, all over-subscription requests will be honored in
full. However, if sufficient Shares are not available to honor all
over-subscription requests, the Fund may issue up to an additional 20% of the
initial Shares (the "Additional Shares"), in order to honor such
over-subscription requests. The Fund may sell Additional Shares to
stockholders if and to the extent that shares issued through the Offer would
dilute (reduce) the net asset value of its Common Stock by less than 1.0%. To
the extent that there are not sufficient Shares to honor all over-subscription
requests, the available Shares will be allocated among those who
over-subscribe based on the number of Rights originally issued to them by the
Fund, so that the number of Shares issued to Stockholders who subscribe
through the Over-Subscription Privilege will generally be in proportion to the
number of Shares of the Fund owned by them on the Record Date. The percentage
of remaining Shares each over-subscribing Stockholder may acquire may be
rounded up or down to result in delivery of whole Shares. The allocation
process may involve a series of allocations in order to ensure that the total
number of Shares available for over-subscriptions is distributed, as nearly as
may be practicable, on a pro rata basis. The Fund will not offer or sell any
Shares which are not subscribed for through the Primary Subscription or the
Over-Subscription Privilege. The combination of the Over-Subscription
Privilege and the Fund's election to issue Additional Shares may result in
additional dilution of interest and voting rights to Stockholders, and
additional reduction in the Fund's NAV per share.

     Charles M. Royce and certain other officers and employees of Royce may
purchase shares of Common Stock in the Primary Subscription and the
Over-Subscription Privilege. Any such purchases will be made on the same terms
applicable to other stockholders.

Subscription Price

     The Subscription Price for the Shares to be issued pursuant to the Offer
will be the lower of (i) $0.50 below the last reported sale price of a share
of the Fund's Common Stock on the NYSE on the Pricing Date or (ii) the NAV of
a share of the Fund's Common Stock on the Pricing Date. For example, if the
last reported sale price of a share of the Fund's Common Stock on the NYSE on
the Pricing Date is $_____ and the NAV of a share of the Fund's Common Stock
on that date is $_____, the Subscription Price will be $_____. However, if the
NAV of a share of the Fund's Common Stock on that date is $_____, then the
Subscription Price will be $_____.

     The Fund announced the Offer after the close of trading on the NYSE on
January ___, 2003. The NAV per share of the Fund's Common Stock at the close
of business on December ___, 2002 and February ___, 2003 were



                                      12
<PAGE>

$_____ and $_____, respectively, and the last reported sales prices of a share
of the Fund's Common Stock on the NYSE on those dates were $______ and $_____,
respectively.

Expiration of the Offer

     The Expiration Date is 5:00 p.m., Eastern time, on March 10, 2003, unless
extended by the Fund. The Rights will expire on the Expiration Date and may
not be exercised after that date. Since the time of the close of the Offer on
the Expiration Date is prior to the Pricing Date, Stockholders who choose to
exercise their Rights will not know the Subscription Price when they decide
whether to acquire Shares on Primary Subscription or through the
Over-Subscription Privilege.

Subscription Agent

     The Subscription Agent for the Offer is Equiserve Trust Company, N.A.
("Equiserve"), which will receive, for its administrative, processing,
invoicing and other services as Subscription Agent, an estimated fee of
$15,000 and reimbursement for all out-of-pocket expenses related to the Offer.
The Subscription Agent is also the Fund's Transfer Agent. Stockholder
inquiries may be directed to Georgeson Shareholder Communications, Inc., the
Information Agent, (toll free) at (866) 328-5443. SIGNED SUBSCRIPTION
CERTIFICATES SHOULD BE SENT TO EQUISERVE TRUST COMPANY, N.A., by one of the
following methods:

<TABLE>
<CAPTION>
<S>      <C>
         (1)      BY FIRST CLASS MAIL:
                  Equiserve Trust Company, N.A.
                  Attn: Corporate Actions
                  P.O. Box 43025
                  Providence,  RI  02940-3025

         (2)      BY EXPRESS MAIL OR OVERNIGHT COURIER:
                  Equiserve Trust Company, N.A.
                  Attn: Corporate Actions
                  40 Campanelli Drive
                  Braintree,  MA  02184

         (3)      BY HAND:
                  Securities Transfer & Reporting Services, Inc.
                  100 Williams Street Galleria
                  New York,  NY  10038

                  DELIVERY TO AN ADDRESS OTHER THAN THE ABOVE DOES NOT CONSTITUTE GOOD DELIVERY.
</TABLE>

Information Agent Coordinator

     Any questions or requests for assistance may be directed to the
Information Agent at its telephone number listed below:

                  Georgeson Shareholder Communications, Inc.
                           Toll Free: (866) 328-5443

     Stockholders may also call the Fund (toll free) at (800) 221-4268 or
contact their Nominees, who hold shares for the account of others, for
information with respect to the Offer.

     The Fund will pay a fee of $12,000 to Georgeson Shareholder
Communications, Inc. and reimbursement for all out-of-pocket expenses related
to its services as Information Agent.



                                      13
<PAGE>

Method for Exercising Rights

     Rights may be exercised by Stockholders who fill in and sign the
accompanying Subscription Certificate and mail it in the envelope provided or
deliver the completed and signed Subscription Certificate to the Subscription
Agent, together with any required payment for the Shares as described below
under "Payment for Shares." Rights may also be exercised by a Stockholder
contacting his or her broker, bank or trust company, which can arrange, on the
stockholder's behalf, to guarantee delivery (using a "Notice of Guaranteed
Delivery") of a properly completed and executed Subscription Certificate and
payment for the Shares. The broker, bank or trust company may charge a fee for
this service. Fractional Shares will not be issued. Completed Subscription
Certificates must be received by the Subscription Agent prior to 5:00 p.m.,
Eastern time, on the Expiration Date (unless payment is to be effected by
means of a notice of guaranteed delivery (see "Payment for Shares")) at the
offices of the Subscription Agent.

     Stockholders who are Record Owners. Stockholders who are record owners
     can choose between either option set forth below under "Payment for
     Shares." If time is of the essence, option (1) will permit delivery of
     the Subscription Certificate and payment after the Expiration Date.

     Investors Whose Shares Are Held Through A Nominee. Stockholders whose
     shares are held by a Nominee such as a broker, bank or trust company,
     must contact that Nominee to exercise their Rights. In that case, the
     Nominee will complete the Subscription Certificate on behalf of the
     stockholder and arrange for proper payment by one of the methods set
     forth below under "Payment for Shares."

     Nominees. Nominees, who hold shares for the account of others, should
     notify the respective beneficial owners of such shares as soon as
     possible to ascertain such beneficial owners' intentions and to obtain
     instructions with respect to the Rights. If the beneficial owner so
     instructs, the Nominee should complete the Subscription Certificate and
     submit it to the Subscription Agent, together with the proper payment
     described below under "Payment for Shares."

Payment for Shares

     Stockholders who acquire Shares in the Primary Subscription or pursuant
to the Over-Subscription Privilege may choose between the following methods of
payment:

     (1)  If, prior to 5:00 p.m., Eastern time, on the Expiration Date, the
          Subscription Agent has received a Notice of Guaranteed Delivery by
          facsimile or otherwise, from a bank or trust company or a NYSE
          member firm, guaranteeing delivery of (a) payment of the full
          Subscription Price for the Shares subscribed for in the Primary
          Subscription and any additional Shares subscribed for through the
          Over-Subscription Privilege and (b) a properly completed and
          executed Subscription Certificate, the subscription will be accepted
          by the Subscription Agent. The Subscription Agent will not honor a
          Notice of Guaranteed Delivery if a properly completed and executed
          Subscription Certificate is not received by the Subscription Agent
          by the close of business on the third (3rd) business day after the
          Expiration Date and full payment for the Shares is not received by
          it by the close of business on the tenth (10th) business day after
          the Confirmation Date.

     (2)  Alternatively, a record owner can send payment for the Shares
          acquired in the Primary Subscription, together with the Subscription
          Certificate, to the Subscription Agent based on an assumed purchase
          price of $_____ per Share. To be accepted, such payment, together
          with the Subscription Certificate, must be received by the
          Subscription Agent prior to 5:00 p.m., Eastern time, on the
          Expiration Date.

     IF THE SECOND METHOD DESCRIBED ABOVE IS USED, PAYMENT BY CHECK MUST
ACCOMPANY ANY SUBSCRIPTION CERTIFICATE FOR THE SUBSCRIPTION CERTIFICATE TO BE
ACCEPTED.



                                      14
<PAGE>

     STOCKHOLDERS WILL HAVE NO RIGHT TO RESCIND THEIR SUBSCRIPTION AFTER
RECEIPT OF THEIR PAYMENT FOR SHARES BY THE SUBSCRIPTION AGENT, EXCEPT AS
PROVIDED BELOW UNDER "NOTICE OF NET ASSET VALUE DECLINE / POSSIBLE SUSPENSION
OR WITHDRAWAL OF THE OFFER."

     THE METHOD OF DELIVERY OF SUBSCRIPTION CERTIFICATES AND PAYMENT OF THE
SUBSCRIPTION PRICE TO THE FUND WILL BE AT THE ELECTION AND RISK OF THE RIGHTS
HOLDERS, BUT IF SENT BY MAIL IT IS RECOMMENDED THAT SUCH SUBSCRIPTION
CERTIFICATES AND PAYMENT BE SENT BY REGISTERED MAIL, PROPERLY INSURED, WITH
RETURN RECEIPT REQUESTED, AND THAT A SUFFICIENT NUMBER OF DAYS BE ALLOWED TO
ENSURE DELIVERY TO THE FUND AND CLEARANCE OF PAYMENT PRIOR TO 5:00 P.M.,
EASTERN TIME, ON THE EXPIRATION DATE. BECAUSE UNCERTIFIED PERSONAL CHECKS MAY
TAKE AT LEAST FIVE BUSINESS DAYS TO CLEAR AND MAY, AT THE DISCRETION OF THE
FUND, NOT BE ACCEPTED IF NOT CLEARED PRIOR TO THE EXPIRATION DATE, YOU ARE
STRONGLY ENCOURAGED TO PAY, OR ARRANGE FOR PAYMENT, BY MEANS OF CERTIFIED OR
BANK CASHIER'S CHECK.

     A confirmation will be sent by the Subscription Agent to each Stockholder
(or, if the Fund's Shares on the Record Date are held by a Nominee, to such
Nominee) by March 18, 2003, showing (i) the number of Shares acquired pursuant
to the Primary Subscription; (ii) the number of Shares, if any, acquired
through the Over-Subscription Privilege; (iii) the per Share and total
purchase price for the Shares; and (iv) any additional amount payable by the
Stockholder to the Fund or any excess to be refunded by the Fund to the
Stockholder, in each case based on the Subscription Price as determined on the
Pricing Date. In the case of any Stockholder who exercises his or her right to
acquire Shares pursuant to the Over-Subscription Privilege, any excess payment
which would otherwise be refunded to the Stockholder will be applied by the
Fund toward payment for additional Shares acquired pursuant to exercise of the
Over-Subscription Privilege. Any additional payment required from a
Stockholder must be received by the Subscription Agent within ten (10)
business days after the Confirmation Date. Any excess payment to be refunded
by the Fund to a Stockholder will be mailed by the Subscription Agent to such
Stockholder as promptly as possible within ten (10) business days after the
Confirmation Date. All payments by a Stockholder must be made in United States
dollars by money order or check drawn on a bank located in the United States
of America and payable to ROYCE VALUE TRUST, INC.

     Issuance and delivery of certificates for the Shares purchased are
subject to collection of checks and actual payment through any Notice of
Guaranteed Delivery.

     If a Stockholder who acquires Shares pursuant to the Primary Subscription
or Over-Subscription Privilege does not make payment of all amounts due by the
eighth (8th) business day after the Confirmation Date, the Fund reserves the
right to (i) find other purchasers for such subscribed and unpaid Shares; (ii)
apply any payment actually received by it toward the purchase of the greatest
number of whole Shares which could be acquired by such Stockholder upon
exercise of the Primary Subscription and/or Over-Subscription Privilege;
and/or (iii) exercise any and all other rights and/or remedies to which it may
be entitled, including, without limitation, the right to set-off against
payments actually received by it with respect to such subscribed Shares.

     All questions concerning the timeliness, validity, form and eligibility
of any exercise of Rights will be determined by the Fund, whose determinations
will be final and binding. The Fund in its sole discretion may waive any
defect or irregularity, or permit a defect or irregularity to be corrected
within such time as it may determine, or reject the purported exercise of any
Right. Subscriptions will not be deemed to have been received or accepted
until all irregularities have been waived or cured within such time as the
Fund determines in its sole discretion. The Fund will not be under any duty to
give notification of any defect or irregularity in connection with the
submission of Subscription Certificates or incur any liability for failure to
give such notification.

Notice of Net Asset Value Decline / Possible Suspension or Withdrawal of the
Offer

     The Fund has, as required by the SEC's registration form, undertaken to
suspend the Offer until it amends this Prospectus if, subsequent to February
__, 2003, the effective date of the Fund's Registration Statement, the Fund's
NAV declines more than 10% from its NAV as of February __, 2003. Accordingly,
the Fund will notify Stockholders of any such decline and thereby permit them
to cancel their exercise of Rights.



                                      15
<PAGE>

Delivery of Share Certificates

     Participants in the Fund's Distribution Reinvestment and Cash Purchase
Plan (the "Plan") will have any Shares acquired in the Primary Subscription
and pursuant to the Over-Subscription Privilege credited to their accounts in
the Plan. Stock certificates will not be issued for Shares credited to Plan
accounts. Stockholders whose Shares are held of record by a Nominee on their
behalf will have any Shares acquired in the Primary Subscription and pursuant
to the Over-Subscription Privilege credited to the account of such Nominee.
For all other Stockholders, stock certificates for all Shares acquired will be
mailed promptly after full payment for the subscribed Shares has been received
and cleared.

Federal Income Tax Consequences of the Offer

     Stockholders who receive Rights pursuant to the Offer will not recognize
taxable income for U.S. Federal income tax purposes upon their receipt of the
Rights. If Rights issued to a Stockholder expire without being exercised, no
basis will be allocated to such Rights, and such stockholder will not
recognize any gain or loss for U.S. Federal income tax purposes upon such
expiration.

     The tax basis of a Stockholder's Common Stock will remain unchanged, and
the stockholder's basis in the Rights will be zero. A Stockholder who
exercises Rights will not recognize any gain or loss for U.S. Federal income
tax purposes upon the exercise. The basis of the newly acquired Common Stock
will equal the Subscription Price paid for the Common Stock. Upon a sale or
exchange of the Common Stock so acquired, the Stockholder will recognize gain
or loss measured by the difference between the proceeds of the sale or
exchange and the cost basis of such Common Stock. Assuming the Stockholder
holds the Common Stock as a capital asset, any gain or loss realized upon its
sale will generally be treated as a capital gain or loss, which gain or loss
will be short-term or long-term, depending on the length of the Stockholder's
holding period for such Common Stock. However, it currently appears that any
loss recognized upon the sale of shares of Common Stock with a tax holding
period of 6 months or less will be treated as a long-term capital loss to the
extent of any capital gain distribution previously received by the Stockholder
with respect to such Shares, and a loss may be disallowed under wash sale
rules to the extent that the Stockholder purchases additional Common Stock
(including by reinvestment of distributions) within 30 days before or after
the sale date. The holding period for Common Stock acquired upon the exercise
of Rights will begin on the date of exercise of the Rights.

     The foregoing is a summary of the material U.S. Federal income tax
consequences of the Offer under the provisions of the U.S. Internal Revenue
Code of 1986, as amended (the "Code"), and applicable existing and proposed
regulations thereunder, all as currently in effect and all subject to change
at any time, perhaps with retroactive effect. It does not include any state,
local or foreign tax consequences of the Offer. This summary is generally
applicable to Stockholders that are United States persons as defined in the
Code. Further, this summary is not intended to be, nor should it be, construed
as legal or tax advice, and stockholders are urged to consult their own tax
advisors to determine the tax consequences to them of the Offer and their
ownership of Rights and Common Stock.

Special Considerations

     If you do not fully exercise your Rights, you should expect that you
will, at the completion of the Offer, own a smaller proportional interest in
the Fund than would otherwise be the case if you exercised your Rights. We
cannot determine the extent of this dilution at this time because we do not
know what proportion of the Fund's Shares will be purchased as a result of the
Offer.

     You may experience dilution in your holdings because you will indirectly
bear the expenses of the Offer. Further, if you do not submit subscription
requests pursuant to the Over-Subscription Privilege, you may also experience
dilution in your holdings if the Fund offers Additional Shares for
subscription. We cannot state precisely the amount of any such decrease in NAV
because we do not know at this time how many Shares will be subscribed for or
what the NAV or market price per share will be at the Pricing Date. As of
February ___, 2003, the Fund's shares traded at a ___% [premium above]
[discount from] NAV. If the Fund's shares trade at a premium above NAV as of
the Pricing Date, the Fund estimates that such dilution would be minimal. See
"Risk Factors and Special Considerations at a Glance - Dilution - Net Asset
Value and Non-Participation in the Offer." Except as described in



                                      16
<PAGE>

this Prospectus, you will have no right to rescind your subscription requests
after receipt of your payment for Shares by the Subscription Agent.

Other Rights Offerings

     The Fund had below-NAV rights offerings during each of the seven years
ended December 31, 1995, and may have similar rights offerings in the future.
Any such future rights offerings would be separately registered with the SEC
and made by means of separate prospectuses.

                                                          USE OF PROCEEDS

     We estimate the net proceeds of the Offer to be approximately $________
($_____ if all of the Additional Shares are available for subscription). These
figures assume (i) all Rights are exercised in full, (ii) a Subscription Price
of $________ and (iii) payment of offering expenses of approximately $200,000.
Royce anticipates that investment of the net proceeds of the Offer in
accordance with the Fund's investment goal and policies will take up to six
months from ______________, depending on market conditions and the
availability of appropriate securities. Pending investment, the net proceeds
of the Offer will be held in the types of short-term debt securities and
instruments in which the Fund may invest. See "Investment Goal and
Policies--Investment Methods/Policies." As a result of this short-term
investment of the proceeds, a lower yield may be realized.

                         INVESTMENT GOAL AND POLICIES

Investment Goal

     The Fund's primary investment goal and one of its fundamental policies is
long-term capital growth. Royce normally invests more than 75% of the Fund's
assets in the equity securities of small- and micro-cap companies, with stock
market capitalizations ranging from $100 million to $2 billion. (Stock market
capitalization is calculated by multiplying the total number of common shares
issued and outstanding by the per share market price of the common stock.) See
"Changes in Investment Goal and Methods/Policies." There are market risks
inherent in any investment, and there is no assurance that the Fund's primary
investment goal will be achieved.

Investment Methods/Policies

     Royce uses a value method in managing the Fund's assets. In selecting
securities for the Fund, Royce evaluates the quality of a company's balance
sheet, the level of its cash flows and various measures of a company's
profitability. Royce then uses these factors to assess the company's current
worth, basing this assessment on either what it believes a knowledgeable buyer
might pay to acquire the entire company or what it thinks the value of the
company should be in the stock market. This analysis takes a number of factors
into consideration, including the company's future growth prospects and
current financial condition.

     Royce invests in securities of companies that are trading significantly
below its estimate of the company's "current worth" in an attempt to reduce
the risk of overpaying for such companies. Royce's value approach strives to
reduce some of the other risks of investing in small- and micro-cap companies
(for the Fund's portfolio taken as a whole) by evaluating various other risk
factors. Royce attempts to lessen financial risk by buying companies that
combine strong balance sheets with low leverage. While there can be no
assurance that this risk-averse value approach will be successful, Royce
believes that it can reduce some of the risks of investing in the securities
of small- and micro-cap companies, which are inherently fragile in nature and
whose securities have substantially greater market price volatility. Although
Royce's approach to security selection seeks to reduce downside risk to the
Fund's portfolio, especially during periods of broad small-cap market
declines, it may also potentially have the effect of limiting gains in strong
small-cap up markets.

     Foreign Investments. The Fund may invest up to 10% of its assets in
securities of foreign issuers. Foreign investments involve certain additional
risks, such as political or economic instability of the issuer or of the
country of issue, fluctuating exchange rates and the possibility of imposition
of exchange controls.



                                      17
<PAGE>

     Fixed Income Securities. The Fund may invest up to 25% of its assets in
direct obligations of the government of the United States or its agencies
and/or in non-convertible preferred stocks and non-convertible debt securities
of various issuers, including up to 5% of its net assets in below
investment-grade debt securities, also known as high-yield fixed income
securities. Such below investment-grade debt securities may be in the
lowest-grade categories of recognized ratings agencies (C in the case of
Moody's Investor Service, Inc. ("Moody's") or D in the case of Standard &
Poor's) or may be unrated. High-yield/high-risk investments are primarily
speculative and may entail substantial risk of loss of principal and
non-payment of interest, but may also produce above-average returns for the
Fund. Debt securities rated C or D may be in default as to the payment of
interest or repayment of principal.

     Warrants, Rights or Options. The Fund may invest up to 5% of its total
assets in warrants, rights or options. A warrant, right or call option
entitles the holder to purchase a given security within a specified period for
a specified price and does not represent an ownership interest in the
underlying security. A put option gives the holder the right to sell a
particular security at a specified price during the term of the option. These
securities have no voting rights, pay no dividends and have no liquidation
rights. In addition, market prices of warrants, rights or call options do not
necessarily move parallel to the market prices of the underlying securities;
market prices of put options tend to move inversely to the market prices of
the underlying securities.

     Securities Lending. The Fund may lend up to 25% of its assets to brokers,
dealers and other financial institutions. However, under the Moody's current
rating agency guidelines relating to the Issued Preferred, the Fund may not
lend portfolio securities in excess of 5% of its total assets. Moody's current
rating agency guidelines may in the future be amended to permit the Fund to
lend a greater percentage of its total assets. Securities lending allows the
Fund to retain ownership of the securities loaned and, at the same time, to
earn additional income. Since there may be delays in the recovery of loaned
securities or even a loss of rights in collateral supplied should the borrower
fail financially, loans will be made only to parties that participate in a
Global Securities Lending Program organized and monitored by the Fund's
custodian and who are deemed by it to be of good standing. Furthermore, such
loans will be made only if, in Royce's judgment, the consideration to be
earned from such loans would justify the risk.

     The current view of the staff of the SEC is that a fund may engage in
such loan transactions only under the following conditions: (i) the fund must
receive 100% collateral in the form of cash or cash equivalents (e.g., U.S.
Treasury bills or notes) from the borrower; (ii) the borrower must increase
the collateral whenever the market value of the securities loaned (determined
on a daily basis at the close of regular trading) rises above the value of the
collateral; (iii) after giving notice, the fund must be able to terminate the
loan at any time; (iv) the fund must receive reasonable interest on the loan
or a flat fee from the borrower, as well as amounts equivalent to any
dividends, interest or other distributions on the securities loaned; (v) the
fund may pay only reasonable custodian fees in connection with the loan; and
(vi) the fund must be able to vote proxies on the securities loaned, either by
terminating the loan or by entering into an alternative arrangement with the
borrower.

     Temporary Investments. The assets of the Fund are normally invested in
the equity securities of small- and micro-cap companies. However, for
temporary defensive purposes (i.e., when Royce determines that market
conditions warrant) or when it has uncommitted cash balances, the Fund may
also invest in U.S. Treasury bills, domestic bank certificates of deposit,
repurchase agreements with its custodian bank covering United States Treasury
and agency obligations having a term of not more than one week, high-quality
commercial paper and money market funds registered under the 1940 Act, or
retain all or part of its assets in cash. Accordingly, the composition of the
Fund's portfolio may vary from time to time.

Changes in Investment Goal and Methods/Policies

     The Fund's primary investment goal of long-term capital growth is a
fundamental policy of the Fund and may not be changed without approvals of the
holders of a majority of the Fund's outstanding shares of Common Stock and
Issued Preferred and any other Preferred Stock, voting together as a single
class, and a majority of the Issued Preferred and any other Preferred Stock,
voting as a separate class (which for this purpose and under the 1940 Act
means the lesser of (i) 67% or more of the relevant shares of capital stock of
the Fund present or represented at a meeting of stockholders, at which the
holders of more than 50% of the outstanding relevant shares of capital stock
are present or represented or (ii) more than 50% of the outstanding relevant
shares of capital stock of the Fund). Except as indicated under "Investment
Restrictions" in the Statement of Additional Information, the Fund does not



                                      18
<PAGE>

consider its other policies, such as seeking current income, to be
fundamental, and such policies may be changed by the Board of Directors
without stockholder approval or prior notice to stockholders. Although the
Fund may seek current income by investing in dividend-paying equity securities
of small- and micro-cap companies, this is not the Fund's primary investment
goal.

     The Fund's investment policies are subject to certain restrictions. See
"Investment Restrictions" in the Statement of Additional Information.

                               ________________

Special Considerations - Investing in Small- and Micro-Cap Companies

     Royce views the large and diverse universe of small-cap companies as
having two investment segments or tiers. Royce defines small-cap as those
companies with market capitalizations between $400 million and $2 billion; it
refers to the segment with market capitalizations less than $400 million as
micro-cap.

     The securities of small- and micro-cap companies offer investment
opportunities and additional risks. They may not be well known to the
investing public, may not be significantly owned by institutional investors
and may not have steady earnings growth. In addition, the securities of such
companies may be more volatile in price, have wider spreads between their bid
and ask prices and have significantly lower trading volumes than larger
capitalization stocks. As a result, the purchase or sale of more than a
limited number of shares of a small- or micro-cap security may affect its
market price. Royce may need a considerable amount of time to purchase or sell
its positions in these securities, particularly when other accounts managed by
Royce or other investors are also seeking to purchase or sell them.
Accordingly, Royce's investment focus on small- and micro-cap companies
generally requires it to have a long-term (at least three years) investment
outlook for a portfolio security.

     The micro-cap segment consists of more than 6,900 companies. These
companies are followed by relatively few, if any, securities analysts, and
there tends to be less publicly available information about them. Their
securities generally have even more limited trading volumes and are subject to
even more abrupt or erratic market price movements than are the securities in
the upper tier, and Royce may be able to deal with only a few market-makers
when purchasing and selling these securities. Such companies may also have
limited markets, financial resources or product lines, may lack management
depth and may be more vulnerable to adverse business or market developments.
These conditions, which create greater opportunities to find securities
trading well below Royce's estimate of the company's current worth, also
involve increased risk. This leads Royce to more broadly diversify most of the
Fund's assets invested in micro-cap stocks by holding proportionately smaller
positions in more companies.

     The upper tier of the small-cap universe of securities consists of
approximately 1,400 companies. In this segment, there is a relatively higher
level of ownership by institutional investors and more research coverage by
securities analysts than generally exists for micro-cap companies. This
greater attention makes the market for these securities more efficient than
that of micro-cap companies because they have somewhat greater trading volumes
and narrower bid/ask spreads. As a result, Royce normally employs a more
concentrated approach when investing in the upper tier of small-caps, holding
proportionately larger positions in a relatively limited number of securities.

Risks to Common Stockholders of Borrowing Money and Issuing Senior Securities

     General. The 1940 Act and the Fund's fundamental policies (see
"Investment Restrictions" in the Statement of Additional Information) permit
the Fund to borrow money from banks and certain other lenders and to issue and
sell senior securities representing indebtedness or consisting of Preferred
Stock if various requirements are met. Such requirements include initial asset
coverage tests of 300% for indebtedness (see "Risk Factors and Special
Considerations - Risks to Common Stockholders of Borrowing Money and Issuing
Senior Securities - Asset Coverage Test" in the Statement of Additional
Information) and 200% for Preferred Stock and, except for indebtedness to
banks and certain other lenders, restrictive provisions concerning Common
Stock dividend payments, other Common Stock distributions, stock repurchases
and maintenance of asset coverage and giving certain senior security holders
the right to elect directors in the event specified asset coverage tests are
not met or



                                      19
<PAGE>

dividends are not paid. As of December 31, 2002, the aggregate involuntary
liquidation preference of the Issued Preferred was $160 million. At this
level, a decrease of ____% of the Fund's total assets or ____% of its net
assets would be necessary to reduce the asset coverage for the Issued
Preferred to less than 200%. The issuance and sale of senior securities allows
the Fund to raise additional cash for investments. It is a speculative
investment technique, involving the risk considerations of leverage and
increased share price volatility. So long as the Issued Preferred is rated by
Moody's, the Fund cannot borrow for investment leverage purposes.

     Borrowings. The following factors could increase the investment risk and
the volatility of the price of the Fund's shares of Common Stock: (i)
leveraging exaggerates any increase or decrease in the value of the Fund's
portfolio; (ii) the costs of borrowing may exceed the income from the
portfolio securities purchased with the borrowed money; (iii) a decline in NAV
results if the investment performance of the additional securities purchased
fails to cover their cost to the Fund (including any interest paid on the
money borrowed); (iv) a decline in NAV could affect the ability of the Fund to
make Common Stock dividend payments; (v) a failure to pay net investment
income dividends or make capital gains distributions could result in the
Fund's ceasing to qualify as a regulated investment company under the Code, or
in its having to pay certain entity level taxes even if it maintains its
status as a regulated investment company (see "Taxation" in this Prospectus
and in the Statement of Additional Information); and (vi) if the asset
coverage for debt securities declines to less than 300% (as a result of market
fluctuations or otherwise), the Fund may be required to sell a portion of its
investments when it may be disadvantageous to do so.

     Preferred Stock. Preferred Stock may result in higher volatility of the
NAV of the Common Stock and potentially more volatility in the market price of
the Common Stock. Holders of Common Stock will realize a higher current rate
of return than if the Fund were not leveraged only so long as the Fund, after
accounting for its costs and operating expenses, is able to realize a higher
net return on its investment portfolio than the then current dividend rates
paid on Preferred Stock. Similarly, since a pro rata portion of the Fund's net
realized capital gains are generally payable to holders of Common Stock, the
use of leverage will increase the amount of such gains distributed to holders
of Common Stock. To the extent that the dividend rates on Preferred Stock
approach the net return on the Fund's investment portfolio, the benefit of
leverage to holders of Common Stock will be decreased. (If the dividend rates
on Preferred Stock were to exceed the net return on the Fund's portfolio,
holders of Common Stock would receive a lower rate of return than if the Fund
were not leveraged.) Similarly, since both the cost of issuing Preferred Stock
and any decline in the value of the Fund's investments (including investments
purchased with the proceeds from Preferred Stock offerings) is borne entirely
by holders of Common Stock, the effect of leverage in a declining market would
result in a greater decrease in NAV to holders of Common Stock than if the
Fund were not leveraged. Such decrease in NAV likely would be reflected in a
greater decline in the market price for shares of the Fund's Common Stock. If
the Fund is liquidated, holders of Preferred Stock will be entitled to receive
liquidating distributions before any distribution is made to holders of Common
Stock. Redemption of Preferred Stock or insufficient investment income to make
dividend payments may reduce the NAV of the Common Stock by requiring the Fund
to liquidate a portion of its investments at a time when it may be
disadvantageous to do so.

     In an extreme case, a decline in NAV could affect the Fund's ability to
pay dividends on the Common Stock. Failure to make such dividend payments
could adversely affect the Fund's qualification as a regulated investment
company under the Code. See "Taxation" in this Prospectus and in the Statement
of Additional Information. However, the Fund intends to take all measures
necessary to make such Common Stock dividend payments. If the Fund's current
investment income is ever insufficient to meet dividend payments on either the
Common Stock or the Preferred Stock, the Fund may have to liquidate certain of
its investments. In addition, the Fund will have the authority to redeem the
7.80% Preferred for any reason on or after August 15, 2003, to redeem the
7.30% Preferred for any reason on or after June 22, 2003, and may redeem all
or part of the Issued Preferred prior to such dates to the extent required by
the 1940 Act and the terms of the Issued Preferred. See "Description of
Capital Stock -- Preferred Stock -- Redemption."

     The class and other voting rights of the Preferred Stock could make it
more difficult for the Fund to take certain actions that may, in the future,
be proposed by the Board of Directors and/or the holders of Common Stock, such
as (i) a merger, exchange of securities, liquidation or alteration of the
rights of a class of the Fund's securities if such actions would be adverse to
the Preferred Stock, (ii) converting the Fund to an open-end investment
company or acting inconsistently with its fundamental investment restrictions
or other fundamental policies or (iii) seeking to operate other than as an
investment company.



                                      20
<PAGE>

     The future issuance of any Preferred Stock convertible into Common Stock
might also reduce the net income and NAV per share of the Common Stock upon
conversion. Such income dilution would occur if the Fund could not, from the
investments made with the proceeds of the Preferred Stock, earn an amount per
share of Common Stock issuable upon conversion greater than the dividend
required to be paid on the amount of Preferred Stock convertible into one
share of Common Stock. Such NAV dilution would occur if Preferred Stock were
converted at a time when the NAV per share of Common Stock was greater than
the conversion price.

                               ________________

     On December 31, 2002, the Fund had __________ shares of Common Stock
issued and outstanding, with an aggregate NAV of $__________, 2,400,000 shares
of 7.80% Cumulative Preferred Stock, par value $0.001 per share (the "7.80%
Preferred"), with an aggregate liquidation preference of $60,000,000, issued
and outstanding, and 4,000,000 shares of 7.30% Tax-Advantaged Cumulative
Preferred Stock, par value $0.001 per share (the "7.30% Preferred," and
together with the 7.80% Preferred, the "Issued Preferred"), with an aggregate
liquidation preference of $100,000,000, issued and outstanding, and no
outstanding indebtedness. Accordingly, as of such date, the Fund could have,
under the above policies and restrictions, issued and sold senior securities
representing indebtedness of up to $____________ or additional shares of
Preferred Stock having an aggregate involuntary liquidation preference of up
to $____________ or various combinations of lesser amounts of both securities
representing indebtedness and Preferred Stock.

     Effects of Preferred Stock Leverage on Common Stockholders. Dividends are
payable on the Issued Preferred at the annual rates of 7.80% and 7.30%,
respectively. The Fund's portfolio must experience a return of ____% for the
year ending December 31, 2003 in order to cover that year's dividend on the
Issued Preferred.

     The fees paid to Royce for investment advisory services are higher than
if the Fund did not have Preferred Stock outstanding because they are
calculated on the basis of the Fund's average net assets (including assets
obtained from the sale of Preferred Stock). See "Investment Advisory and Other
Services."

     The following table is designed to illustrate the effect on the return to
a holder of the Fund's Common Stock of the leverage obtained with the Issued
Preferred, assuming hypothetical annual returns on the Fund's portfolio of
minus 10% to plus 10%. As the table shows, leverage generally increases the
return to stockholders when portfolio return is positive and decreases the
return when portfolio return is negative. See "Risk Factors and Special
Considerations at a Glance - Preferred Stock - Leverage Risk." The figures
appearing in the following table are hypothetical. Actual returns may be
greater or less than those appearing in the table.

<TABLE>
<CAPTION>
<S>                                            <C>         <C>        <C>         <C>          <C>
          Assumed return on portfolio
          (net of expenses)                     -10%        -5%          0%          5%         10%
          Corresponding NAV return to
          Common Stockholder                   -____%      -____%      -____%      ____%       ____%
</TABLE>

     Financial Impact of Senior Securities on Common Stockholders. The costs
related to the issue and sale of senior securities such as Preferred Stock,
including underwriting discount, rating agency fees and offering expenses, are
paid by the Fund and, therefore, borne by its Common Stockholders. Also, the
interest and dividend requirements of such senior securities will reduce the
amount of and may entirely eliminate any net investment income dividends
otherwise payable by the Fund to its Common Stockholders.

                    INVESTMENT ADVISORY AND OTHER SERVICES

     Royce & Associates, LLC (which term as used in this Prospectus includes
its corporate predecessor) ("Royce"), a Delaware limited liability company, is
an investment advisory firm whose predecessor was organized in February 1967.
Royce is registered as an investment adviser under Investment Advisers Act of
1940, as amended. Royce became investment adviser of the Fund in November
1986, when the Fund commenced operations. Royce also serves as investment
adviser to other management investment companies and institutional accounts.
As of December 31, 2002, Royce managed approximately $___ billion in assets
for the Fund and other registered investment companies advised and sponsored
by Royce and other client accounts. Substantially all of Royce's client
accounts are managed as small- and micro-cap investment products.



                                      21
<PAGE>

     On October 1, 2001, Royce became an indirect wholly-owned subsidiary of
Legg Mason, Inc. ("Legg Mason"). On March 31, 2002, Royce's corporate
predecessor was merged into Royce Holdings, LLC (a wholly-owned subsidiary of
Legg Mason), which then changed its name to Royce & Associates, LLC. As a
result of this merger, Royce & Associates, LLC became the Fund's investment
adviser and a direct wholly-owned subsidiary of Legg Mason. Founded in 1899,
Legg Mason is a publicly-held financial services company primarily engaged in
providing asset management, securities brokerage, investment banking and
related financial services through its subsidiaries. As of December 31, 2002,
Legg Mason's asset management subsidiaries had aggregate assets under
management of approximately $___ billion.

     Under the Fund's Articles of Incorporation, as amended and supplemented
(the "Charter"), and Maryland law, the Fund's business and affairs are managed
under the direction of its Board of Directors. Investment decisions for the
Fund are made by Royce, subject to any direction it may receive from the
Fund's Board of Directors, which periodically reviews the Fund's investment
performance.

Portfolio Management

     Royce is responsible for the management of the Fund's assets. Royce has
been investing in small-cap companies with a value approach for more than 25
years. Its offices are located at 1414 Avenue of the Americas, New York, NY
10019. Charles M. Royce has been the firm's President and Chief Investment
Officer during this period. He is also the primary portfolio manager of the
Fund.

     Royce's investment staff also includes three other Senior Portfolio
Managers: W. Whitney George, Managing Director and Vice President; Boniface A.
Zaino, Managing Director; and Charles R. Dreifus, Principal. Royce's
investment staff is assisted by Jack E. Fockler, Jr., Managing Director and
Vice President. Mr. George has been employed by Royce since 1991. Mr. Zaino
joined Royce in April 1998 and previously was Group Managing Director at Trust
Company of the West (since 1984). Mr. Dreifus joined Royce in February 1998
and previously was Managing Director (since June 1995) and General Partner
(from 1983 until June 1995) of Lazard Freres & Co. LLC. Mr. Fockler has been
employed by Royce since 1989.

Investment Advisory Agreement

     Under the Investment Advisory Agreement between the Fund and Royce, Royce
determines the composition of the Fund's portfolio, the nature and timing of
the changes in it and the manner of implementing such changes; provides the
Fund with investment advisory, research and related services for the
investment of its assets; and pays all expenses incurred in performing its
investment advisory duties under the Agreement.

     The Fund pays all of its own administrative and other costs and expenses
attributable to its operations and transactions (except those set forth
above), including, without limitation, registrar, transfer agent and custodian
fees; legal, administrative and clerical services; rent for its office space
and facilities; auditing; preparation, printing and distribution of its proxy
statements, stockholder reports and notices; Federal and state registration
fees; listing fees and expenses; Federal, state and local taxes;
non-affiliated directors fees; interest on its borrowings; brokerage
commissions; and the cost of issue, sale and repurchase of its shares. Thus,
unlike most other investment companies, the Fund is required to pay
substantially all of its expenses, and Royce does not incur substantial fixed
expenses.

Advisory Fee

     As compensation for its services under the Investment Advisory Agreement,
Royce is entitled to receive a fee comprised of a Basic Fee (the "Basic Fee")
at the rate of 1% per annum of the Fund's average net assets (including assets
obtained from the sale of Preferred Stock) and an adjustment to the Basic Fee
based on the investment performance of the Fund in relation to the investment
record of the S&P 600 Index. A rolling period of 60 months ending with the most
recent calendar month is utilized for measuring performance and average net
assets.

     The Basic Fee for each such month will be increased or decreased at the
rate of 1/12 of .05% per percentage point, depending on the extent, if any, by
which the investment performance of the Fund exceeds by more than two
percentage points, or is exceeded by more than two percentage points by, the
percentage change in



                                      22
<PAGE>

the investment record of the S&P 600 Index for the performance period. The
maximum increase or decrease in the Basic Fee for any month is 1/12 of 0.5%.
Accordingly, for each month the maximum monthly fee rate as adjusted for
performance will be 1/12 of 1.5% and will be payable if the investment
performance of the Fund exceeds the percentage change in the investment record
of the S&P 600 Index by 12 or more percentage points for the performance
period, and the minimum monthly fee rate as adjusted for performance will be
1/12 of 0.5% and will be payable if the percentage change in the investment
record of the S&P 600 Index exceeds the investment performance of the Fund by
12 or more percentage points for the performance period. As a result, the
actual investment advisory fee rate may at times be greater than the fee rate
paid by many other funds.

     Notwithstanding the foregoing, Royce will not be entitled to receive any
fee for any month when the investment performance of the Fund for the rolling
36-month period ending with such month is negative on an absolute basis. In
the event that the Fund's investment performance for such a performance period
is less than zero, Royce will not be required to refund to the Fund any fee
earned in respect of any prior performance period.

     Royce has committed to voluntarily waive the portion of its investment
advisory fee attributable to a series of Issued Preferred for any month when
the Fund's average annual net asset value total return since issuance of the
series fails to exceed the applicable series' dividend rate.

Code of Ethics

     The Fund's Board of Directors approved a Code of Ethics under Rule 17j-1
of the 1940 Act that covers the Fund and Royce. The Code of Ethics establishes
procedures for personal investing and restricts certain transactions.
Employees subject to the Code of Ethics may invest in securities for their
personal investment accounts, including, in certain cases, securities that may
be purchased or held by the Fund. See "Code of Ethics and Related Matters" in
the Statement of Additional Information.

                         DESCRIPTION OF CAPITAL STOCK

General

     The Fund, which was incorporated under the laws of the State of Maryland
on July 1, 1986, is authorized to issue 150,000,000 shares of Common Stock,
par value $.001 per share. Each share of Common Stock has equal dividend,
distribution and liquidation rights and is entitled to one vote per share on
each matter submitted to a vote of Common Stockholders. The shares of Common
Stock outstanding and those Shares offered hereby, when issued and paid for
pursuant to the terms of the Offer, will be fully paid and non-assessable.
Shares of Common Stock are not redeemable and have no preemptive, exchange,
conversion or cumulative voting rights. As a NYSE-listed company, the Fund is
required to hold annual meetings of its stockholders.

     The Fund's Board of Directors has authority to cause the Fund to issue
and sell up to 50,000,000 shares of Preferred Stock, $.001 par value per
share, that may be convertible into shares of the Fund's Common Stock. The
terms of such Preferred Stock are, or would be, fixed by the Board of
Directors and materially limit and/or qualify, or would materially limit
and/or qualify, the rights of the holders of the Fund's Common Stock. See
"Investment Goal and Policies -- Risks to Common Stockholders of Borrowing
Money and Issuing Senior Securities."

     The following table shows the number of shares of (i) capital stock
authorized and (ii) capital stock outstanding for each class of authorized
securities of the Fund as of December 31, 2002 and as adjusted for the Offer.



                                      23
<PAGE>

<TABLE>
<CAPTION>
                                                                                 Amount
                                            Amount           Amount           Outstanding,
                   Title of Class         Authorized      Outstanding*         As Adjusted
              ----------------------    ----------------  -------------     ---------------
<S>                                     <C>               <C>               <C>
              Common Stock                150,000,000                                  **
              Preferred Stock              50,000,000       6,400,000          6,400,000
                   7.80% Preferred         10,000,000       2,400,000          2,400,000
                   7.30% Preferred         10,000,000       4,000,000          4,000,000
</TABLE>
_____________

*    The Fund does not hold any shares of Common Stock or Preferred Stock for
     its own account.
**   If the Fund increases the amount of Shares subject to the Offer by 20% in
     order to satisfy over-subscription requests, the amount of shares of
     Common Stock outstanding as adjusted would be increased by ________
     Shares to an aggregate of ________ Shares.

Common Stock

     Net Asset Values and Sales Prices. The Fund's shares of Common Stock are
publicly held and are listed and traded on the NYSE under the symbol "RVT."
The following table sets forth for the periods indicated the high and low
sales prices on the NYSE per share of Common Stock of the Fund, the NAV per
share on the dates of the market highs and lows and the number of shares
traded.

<TABLE>
<CAPTION>
                                         Net Asset Value
                                        Per Share on Date               Market Price Per Share
                                         of Market High                      and Related                    Reported NYSE
                                           and Low (1)             Discount (-)/Premium (+) (2)(3)              Volume
                                       -------------------     --------------------------------------      ---------------
Quarter Ended                           High        Low              High                    Low
                                       --------    -------     --------------             -----------     ----------------
<S>                                    <C>         <C>         <C>                         <C>            <C>
March 31, 2001                                                                                                        shs
June 30, 2001                                                                                                         shs
September 30, 2001                                                                                                    shs
December 31, 2001                                                                                                     shs
March 31, 2002                                                                                                        shs
June 30, 2002                                                                                                         shs
September 30, 2002                                                                                                    shs
December 31, 2002                                                                                                     shs
</TABLE>
_____________________
(1)  Based on the Fund's computations.
(2)  Highest and lowest market price per share reported on the NYSE.
(3)  "Related Discount (-) / Premium (+)" represents the discount or premium
     from NAV of the shares on the date of the high and low market price for
     the respective quarter.

     As evidenced by the above table, the Common Stock has generally traded in
the market below NAV. On January __, 2003, when the Offer was publicly
announced, the NAV per share of Common Stock was $_____, and the closing price
on the NYSE was $______, representing a [premium of ___% above] [discount of
___% below] NAV. On February __, 2003, such NAV was $_____, and such closing
price was $_____, representing a [premium of ___% above] [discount of ___%
below] NAV.

     The following chart compares the market price total return of the Fund's
Common Stock to its weekly average per share NAV from ______________ through
_______________. See "Investment Performance."


                  [Graphic Chart to be provided by amendment]


     There can be no assurance that the Common Stock will trade in the future
at, above or below NAV.



                                      24
<PAGE>

     Distributions. So long as any shares of Preferred Stock are outstanding,
holders of the Fund's Common Stock will not be entitled to receive any
dividends or other distributions from the Fund unless all accumulated
dividends on outstanding shares of Preferred Stock have been paid, and unless
asset coverage (as defined in the 1940 Act) with respect to such Preferred
Stock would be at least 200% after giving effect to such distributions.

     Net Asset Value. The NAV of the Fund's shares of Common Stock is
calculated at the close of regular trading on the NYSE (generally 4:00 p.m.
Eastern time) every day that the NYSE is open. The Fund makes this information
available daily by telephone (800-221-4268), via its web site
(www.roycefunds.com) and through electronic distribution for media
publication, including major internet-based financial services web sites and
portals (bloomberg.com, yahoo.com, cbsmarketwatch.com, etc.). Currently, The
Wall Street Journal, The New York Times and Barron's publish NAVs for
closed-end investment companies weekly.

     The NAV per share of the Common Stock is calculated by dividing the
current value of the Fund's total assets less the sum of all of its
liabilities and the aggregate liquidation preferences of its outstanding
shares of Preferred Stock, by the total number of outstanding shares of Common
Stock. The Fund's investments are valued based on market prices or, if market
quotations are not readily available, at their fair value as determined in
good faith under procedures established by the Fund's Board of Directors.

Preferred Stock

     General. Under the Charter, the Fund is authorized to issue up to
10,000,000 shares of 7.80% Preferred and up to 10,000,000 shares of 7.30%
Preferred. As of the date of this Prospectus, there were 2,400,000 shares of
7.80% Preferred issued and outstanding and 4,000,000 shares of 7.30% Preferred
issued and outstanding, constituting the only authorized series of Preferred
Stock. The 7.80% Preferred and 7.30% Preferred rank on a parity with each
other as to dividends and payment upon liquidation. The Board of Directors
reserves the right to issue additional shares of 7.80% Preferred, 7.30%
Preferred or other Preferred Stock from time to time, subject to the
restrictions in the Charter and the 1940 Act. The shares of all Preferred
Stock will, upon issuance, be fully paid and nonassessable. Any shares of
Issued Preferred repurchased or redeemed by the Fund will be classified as
authorized but unissued Preferred Stock. The Board of Directors may by
resolution classify or reclassify any authorized but unissued Preferred Stock
from time to time by setting or changing the preferences, rights, voting
powers, restrictions, limitations or terms of redemption. The Fund may not
issue any class of stock senior to the shares of Issued Preferred.

     Under the 1940 Act, the Fund is permitted to have outstanding more than
one series of Preferred Stock so long as no single series has priority over
another series as to the distribution of assets of the Fund or the payment of
dividends. Holders of the Fund's Issued Preferred do not have preemptive
rights to purchase any shares of Preferred Stock that might be issued.

     Distributions. Holders of shares of 7.80% Preferred and 7.30% Preferred
are entitled to receive, when, as and if declared by the Board of Directors of
the Fund out of funds legally available therefor, cumulative cash dividends at
the annual rate of 7.80% and 7.30%, respectively, per share of their
liquidation preference of $25.00 per share, payable quarterly. The Issued
Preferred is listed and traded on the NYSE. If the Fund fails to pay dividends
for two years or more, holders of the Issued Preferred will acquire certain
additional voting rights. See "Voting Rights." Such rights will be their
exclusive remedy for any such failure.

     Redemption. Prior to August 15, 2003 (with respect to the 7.80%
Preferred) and June 22, 2003 (with respect to the 7.30% Preferred), the Fund
may not redeem the Issued Preferred unless failure to do so would cause the
Fund to fail to (i) satisfy the asset coverage test, (ii) maintain the
discounted asset coverage required by Moody's or (iii) continue to qualify for
tax treatment as a regulated investment company.

     Shares of Issued Preferred will generally be redeemable at the option of
the Fund at a price equal to their liquidation preference of $25.00 per share
plus an amount equal to all unpaid dividends accumulated to and including the
date fixed for such payment (whether or not earned or declared by the Fund,
but excluding interest thereon) (the "Liquidation Preference"). Shares of the
Issued Preferred are subject to mandatory redemption at a price equal to their
liquidation preference plus accumulated but unpaid dividends to the date of
redemption upon the



                                      25
<PAGE>

occurrence of certain specified events, such as the failure of the Fund to
maintain the asset coverage for the Issued Preferred specified by Moody's in
connection with their issuance of ratings on the Issued Preferred.

     Liquidation Rights. Upon a liquidation, dissolution or winding up of the
affairs of the Fund (whether voluntary or involuntary), holders of then
outstanding shares of Preferred Stock will be entitled to receive out of the
assets of the Fund available for distribution to stockholders, after
satisfying claims of creditors but before any distribution or payment of
assets is made to holders of the Common Stock, a Liquidation Preference, and
such holders will be entitled to no further participation in any distribution
payment in connection with any such liquidation, dissolution or winding up.
If, upon any liquidation, dissolution or winding up of the affairs of the
Fund, whether voluntary or involuntary, the assets of the Fund available for
distribution among the holders of all outstanding shares of Issued Preferred
and any other outstanding class or series of Preferred Stock ranking on a
parity with the Issued Preferred as to payment upon liquidation, will be
insufficient to permit the payment in full to such holders of Issued Preferred
of the Liquidation Preference and the amounts due upon liquidation with
respect to such other Preferred Stock, then such available assets will be
distributed among the holders of Issued Preferred and such other Preferred
Stock ratably in proportion to the respective preferential amounts to which
they are entitled. Unless and until the Liquidation Preference has been paid
in full to the holders of Issued Preferred, no dividends or distributions will
be made to holders of the Common Stock or any other stock of the Fund ranking
junior to the Issued Preferred as to liquidation.

     Upon any liquidation, the holders of the Common Stock, after required
payments to the holders of Preferred Stock, will be entitled to participate
equally and ratably in the remaining assets of the Fund.

     Rating Agency Guidelines. The Fund intends that, so long as shares of
Issued Preferred are outstanding, the composition of its portfolio will
reflect guidelines established by Moody's in connection with the Fund's
receipt of a rating for the Issued Preferred of Aaa from Moody's. Moody's
issues ratings for various securities reflecting the perceived
creditworthiness of those securities. The guidelines are designed to ensure
that assets underlying outstanding debt or preferred stock will be
sufficiently varied and will be of sufficient quality and amount to justify
investment grade ratings. The guidelines do not have the force of law but have
been adopted by the Fund in order to receive the above-described ratings for
shares of Issued Preferred, which ratings are generally relied upon by
investors in purchasing such securities. The guidelines provide a set of tests
for portfolio composition and asset coverage that supplement (and in some
cases are more restrictive than) the applicable requirements under the 1940
Act.

     The Fund intends to maintain a portfolio value at least equal to the
discounted value of the assets in its portfolio which satisfies minimum values
set by Moody's. Upon any failure to do this, the Fund will seek to alter the
composition of its portfolio to satisfy Moody's. To the extent it is not able
to do so in a timely basis, the Fund may redeem shares of Issued Preferred in
accordance with their terms.

     A securities rating is not a recommendation to buy, sell or hold
securities and is subject to revision or withdrawal at any time by the
assigning rating agency. Each rating should be evaluated independently of any
other rating.

     Voting Rights. Except as otherwise stated in this Prospectus and as
otherwise required by applicable law, holders of shares of Issued Preferred
and any other Preferred Stock will be entitled to one vote per share on each
matter submitted to a vote of stockholders and will vote together with holders
of shares of Common Stock as a single class. Also, except as otherwise
required by the 1940 Act, (i) holders of outstanding shares of each series of
Issued Preferred will be entitled as a series, to the exclusion of the holders
of all other securities, including the other series of Issued Preferred, other
Preferred Stock, Common Stock and other classes of capital stock of the Fund,
to vote on matters affecting such series of the Issued Preferred that do not
materially adversely affect any of the contract rights of holders of such
other securities, including the other series of Issued Preferred, other
Preferred Stock, Common Stock and other classes of capital stock, as expressly
set forth in the Fund's Charter, and (ii) holders of outstanding shares of
each series of Issued Preferred will not be entitled to vote on matters
affecting the other series of Issued Preferred or any other Preferred Stock
that do not materially adversely affect any of the contract rights of holders
of such series of Issued Preferred, as expressly set forth in the Charter. The
foregoing voting provisions will not apply to any shares of Issued Preferred
if, at or prior to the time when the act with respect to



                                      26
<PAGE>

which such vote otherwise would be required will be effected, such shares will
have been (i) redeemed or (ii) called for redemption as required by the
Charter.

     In connection with the election of the Fund's Directors, holders of
shares of Issued Preferred and any other Preferred Stock, voting as a separate
class, will be entitled at all times to elect two of the Fund's Directors, and
the remaining Directors will be elected by holders of shares of Common Stock
and holders of shares of Issued Preferred and any other Preferred Stock,
voting together as single class. In addition, if at any time dividends on
outstanding shares of Issued Preferred and/or any other Preferred Stock are
unpaid in an amount equal to at least two full years' dividends thereon or if
at any time holders of any shares of other Preferred Stock are entitled,
together with the holders of shares of Issued Preferred, to elect a majority
of the Directors of the Fund under the 1940 Act, then the number of Directors
constituting the Board of Directors automatically will be increased by the
smallest number that, when added to the two Directors elected exclusively by
the holders of shares of Issued Preferred and any other Preferred Stock as
described above, would constitute a majority of the Board of Directors as so
increased by such smallest number. Such additional Directors will be elected
at a special meeting of stockholders which will be called and held as soon as
practicable, and at all subsequent meetings at which Directors are to be
elected, the holders of shares of Issued Preferred and any other Preferred
Stock, voting as a separate class, will be entitled to elect the smallest
number of additional Directors that, together with the two Directors which
such holders in any event will be entitled to elect, constitutes a majority of
the total number of Directors of the Fund as so increased. The terms of office
of the persons who are Directors at the time of that election will continue.
If the Fund thereafter pays, or declares and sets apart for payment in full,
all dividends payable on all outstanding shares of Issued Preferred and any
other Preferred Stock for all past dividend periods, the additional voting
rights of the holders of shares of Issued Preferred and any other Preferred
Stock as described above will cease, and the terms of office of all of the
additional Directors elected by the holders of shares of Issued Preferred and
any other Preferred Stock (but not of the Directors with respect to whose
election the holders of shares of Common Stock were entitled to vote or the
two Directors the holders of shares of Issued Preferred and any other
Preferred Stock have the right to elect in any event) will terminate
automatically.

     So long as shares of Issued Preferred are outstanding, the Fund may not,
without the affirmative vote of the holders of two-thirds of the shares of
Issued Preferred outstanding at the time, voting separately as one class,
amend, alter or repeal the provisions of the Charter, whether by merger,
consolidation or otherwise, so as to materially adversely affect any of the
contract rights expressly set forth in the Charter of holders of shares of the
Issued Preferred. The Board of Directors, however, without stockholder
approval, may amend, alter or repeal the rating agency guidelines applicable
to the Issued Preferred in the event the Fund receives confirmation from
Moody's that any such amendment, alteration or repeal would not impair the
rating then assigned to the Issued Preferred. Furthermore, under certain
circumstances, without the vote of stockholders, the Board of Directors may
determine that it is not in the best interests of the Fund to continue to
comply with the rating agency guidelines. See "Rating Agency Guidelines"
above. The affirmative vote of a majority of the votes entitled to be cast by
holders of outstanding shares of the Issued Preferred and any other Preferred
Stock, voting as a separate class, will be required to approve any plan of
reorganization adversely affecting such shares or any action requiring a vote
of security holders under Section 13(a) of the 1940 Act, including, among
other things, changes in the Fund's primary investment goal or changes in the
investment restrictions described as fundamental policies under "Investment
Restrictions" in the Statement of Additional Information. The class vote of
holders of shares of the Issued Preferred and any other Preferred Stock
described above in each case will be in addition to a separate vote of the
requisite percentage of shares of Common Stock and Issued Preferred and any
other Preferred Stock, voting together as a single class, necessary to
authorize the action in question.

     Issuance of Additional Issued Preferred. So long as any shares of Issued
Preferred are outstanding, the Fund may issue and sell up to 7,600,000
additional shares of 7.80% Preferred, 6,000,000 additional shares of 7.30%
Preferred and/or shares of one or more other series of Preferred Stock,
provided that the provisions of the Charter relating to such issuance are
satisfied.

     Repurchase of Issued Preferred. The Fund is a closed-end investment
company and, as such, holders of Issued Preferred do not, and will not, have
the right to redeem their shares of the Fund. The Fund may, however,
repurchase shares of the Issued Preferred and/or any other Preferred Stock
when it is deemed advisable by the Board of Directors in compliance with the
requirements of the 1940 Act and the rules and regulations thereunder.



                                      27
<PAGE>

Certain Corporate Governance Provisions

     The six Fund Directors who are elected by the holders of Common Stock and
Preferred Stock voting together are divided into three classes, each having a
staggered term of three years. The two Directors elected only by the holders
of Preferred Stock stand for election at each annual meeting of stockholders.
Accordingly, it likely would take three years to change a majority of the
Board of Directors. Vacancies on the Board of Directors for one or more of the
six classified positions may be filled by the remaining Directors for the
balance of the term of the class.

     The Fund's By-laws permit stockholders to call a special meeting of
stockholders only if certain procedural requirements are met and the request
is made by stockholders entitled to cast at least a majority of the votes
entitled to be cast at such a meeting. The By-laws also require that advance
notice be given to the Fund in the event a stockholder desires to nominate a
person for election to the Board of Directors or to transact any other
business at an annual meeting of stockholders. With respect to an annual
meeting of stockholders, notice of any such nomination or business must be
delivered to or received at the principal executive offices of the Fund not
less than 90 calendar days nor more than 120 calendar days prior to the
anniversary of the date of mailing of the notice for the preceding year's
annual meeting (subject to certain exceptions). Any advance notice by a
stockholder must be accompanied by certain information as provided in the
By-laws.

     Certain provisions of the 1940 Act and the Charter require a separate
additional vote of the holders of Preferred Stock to approve certain
transactions, including certain mergers, asset dispositions and conversion of
the Fund to open-end status.

     These provisions may have the effect of maintaining the continuity of
management and thus may make it more difficult for the Fund's stockholders to
change the majority of Directors.

                           REPURCHASES OF SECURITIES

     The Fund is a closed-end diversified management investment company and,
as such, its stockholders do not, and will not, have the right to redeem their
shares of the Fund. Although the Fund will not offer to repurchase its shares
of Common Stock and/or Issued Preferred on a periodic basis, it may repurchase
its shares of Common Stock and/or Issued Preferred on such occasions when it
is deemed advisable by the Fund. Under the 1940 Act, the Fund may repurchase
its securities (i) on a securities exchange or such other open market
designated by the SEC (provided that the Fund has, in the case of purchases of
its stock, informed holders of the class of stock involved within the
preceding six months of its intention to repurchase such stock), (ii) by a
tender offer open to all holders of the class of securities involved or (iii)
as otherwise permitted by the SEC. Where a repurchase of shares of the Fund is
to be made that is not to be effected on a securities exchange or an open
market or by the making of a tender offer, the 1940 Act provides that certain
conditions must be met regarding, among other things, distribution of net
income, identity of the seller, price paid, brokerage commissions, prior
notice to holders of the class of its securities involved of an intention to
purchase such securities and the purchase not being made in a manner or on a
basis which discriminates unfairly against the other holders of such class.
The Fund may incur debt, in an amount not exceeding 10% of its total assets,
to finance share repurchase transactions. Any related interest charges will be
paid by the Fund and borne pro rata by the stockholders indirectly through
their interest in the Fund. See "Investment Goal and Policies -- Risks to
Common Stockholders of Borrowing Money and Issuing Senior Securities."

     If the Fund repurchases its shares of Common Stock for a price below
their NAV, the NAV of those shares of Common Stock that remain outstanding
would be enhanced, but this does not necessarily mean that the market price of
those outstanding shares would be affected, either positively or negatively.
Repurchases of shares of Common Stock by the Fund would also decrease its
total assets and accordingly may increase its expenses as a percentage of
average net assets. Further, interest on any borrowings to finance any such
share repurchase transactions would reduce the Fund's net income.

     The Board of Directors of the Fund has authorized the Fund to repurchase
up to 300,000 shares of its Common Stock and up to 10% of each series of
Issued Preferred during the year ending December 31, 2003. Any such
repurchases would take place at then prevailing prices in the open market or
in other transactions. Common



                                      28
<PAGE>

Stock repurchases would be effected at a price per share that is less than the
share's then current NAV, and Preferred Stock repurchases would be effected at
a price per share that is less than the share's liquidation preference.

                DIVIDENDS, DISTRIBUTIONS AND REINVESTMENT PLAN

     The Fund currently has a policy of paying quarterly distributions to its
Common Stockholders. Distributions are currently being made at the annual rate
of 9% of the rolling average of the prior four calendar quarter-end NAVs of
the Fund's Common Stock, with the fourth quarter distribution being the
greater of 2.25% of the rolling average or the distribution required by the
Code. If, for any quarterly distribution, the Fund's net investment income and
net realized capital gains are less than the amount of the distribution, the
difference will constitute a return of capital. The Fund's final distribution
for each calendar year will include any remaining net investment income and
net realized capital gains deemed, for Federal income tax purposes,
undistributed during the year, and may, but need not, include all net
long-term capital gains realized during the year. If, for any calendar year,
the total distributions exceed net investment income and net realized capital
gains, the excess will generally be treated as a tax-free return of capital
(up to the amount of the stockholder's tax basis in his or her shares). The
amount treated as a tax-free return of capital will reduce a stockholder's
adjusted basis in his or her shares, thereby increasing his or her potential
gain or reducing his or her potential loss on the sale of his or her shares.
Pursuant to the requirements of the 1940 Act and other applicable laws, a
notice will accompany each quarterly distribution with respect to the
estimated source of the distribution made. Such distribution policy may, under
certain circumstances, have certain adverse consequences to the Fund and its
stockholders. In addition, in order to make such distributions, the Fund may
have to sell a portion of its investment portfolio at a time when independent
investment judgment might not dictate such action. The Fund's quarterly
distribution policy may be changed by the Board of Directors without
stockholder approval.

     The Fund has adopted a Distribution Reinvestment and Cash Purchase Plan
(the "Plan"), through which all such net investment income dividends and
capital gains distributions are paid to stockholders in the form of additional
shares of the Fund's Common Stock (plus cash in lieu of any fractional shares
which otherwise would have been issuable), unless a stockholder elects to
receive cash as provided below. In this way, a stockholder can maintain an
undiluted investment in the Fund and still allow the Fund to pay out the
required distributable income.

     Distributions to Issued Preferred stockholders are recorded on an accrual
basis and paid quarterly. See "Description of Capital Stock--Preferred
Stock--Distributions."

     No action is required on the part of a registered stockholder to receive
a distribution in shares of Common Stock of the Fund. A registered stockholder
may elect to receive an entire distribution in cash by notifying Equiserve,
the Plan Agent and the Fund's transfer agent and registrar, in writing so that
such notice is received by Equiserve no later than 10 days prior to the record
date for distributions to stockholders. Equiserve will set up an account for
shares acquired through the Plan for each stockholder who has not elected to
receive distributions in cash ("Participant") and hold such shares in
non-certificated form. Upon request by a Participant, received in writing not
less than 10 days prior to the record date, Equiserve will, instead of
crediting shares to the Participant's account, issue a certificate registered
in the Participant's name for the number of whole shares of the Fund's Common
Stock and a check for any fractional share.

     Those stockholders whose shares are held by a broker or other financial
intermediary may receive distributions in cash by notifying their broker or
other financial intermediary.

     The Fund uses only newly-issued shares to implement the Plan, whether its
shares are trading at a premium or at a discount to NAV. The number of shares
to be issued to a stockholder is determined by dividing the total dollar
amount of the distribution payable to such stockholder by the market price per
share of the Fund's Common Stock at the close of regular trading on the NYSE
on the valuation date for such distribution. Market price per share on that
date will be the closing price for such shares on NYSE or, if no sale is
reported for such day, at the average of their electronically-reported bid and
asked prices. The number of shares of the Fund's Common Stock to be
outstanding after giving effect to payment of the distribution cannot be
established until the value per share at which additional shares will be
issued has been determined and elections of the Fund's stockholders have been
tabulated.



                                      29
<PAGE>

     There is no charge to stockholders for receiving their distributions in
the form of additional shares of the Fund's Common Stock. Equiserve's fees for
handling distributions in stock are paid by the Fund. There are no brokerage
charges with respect to shares issued directly by the Fund as a result of
distributions payable in stock. If a Participant elects by written notice to
Equiserve to have Equiserve sell part or all of the shares held by Equiserve
in the Participant's account and remit the proceeds to the Participant,
Equiserve is authorized to deduct a $2.50 transaction fee plus brokerage
commissions from the proceeds.

     Stockholders who receive distributions in the form of stock are subject
to the same Federal, state and local tax consequences as are stockholders who
elect to receive their distributions in cash. A stockholder's basis for
determining gain or loss upon the sale of stock received in a distribution
from the Fund will be equal to the total dollar amount of the distribution
payable to the stockholder.

                                   TAXATION

     The Fund has qualified and intends to continue to qualify as a regulated
investment company under the Code. The Fund currently intends to distribute
all or substantially all its investment company taxable income (all taxable
net investment income and net short-term capital gains) and its net capital
gain each year, thereby avoiding the imposition on the Fund of Federal income
and excise taxes on such distributed income and gain.

     Dividends paid by the Fund from its ordinary income or from an excess of
net short-term capital gains over net long-term capital losses (together
"ordinary income dividends") are taxable to stockholders as ordinary income.
Distributions made from an excess of net long-term gains over net short-term
losses (including gains or losses from certain transactions in warrants and
options) ("capital gain dividends") are taxable to stockholders as long-term
capital gains, regardless of the length of time the stockholder has owned Fund
shares. After the end of each taxable year, the Fund will notify stockholders
of the Federal income tax status of any distributions or deemed distributions
made by the Fund during such year.

     Ordinary income dividends paid to stockholders who are nonresident aliens
or foreign entities will be subject to a 30% United States withholding tax
under existing provisions of the Code applicable to foreign individuals and
entities unless a reduced rate of withholding or a withholding exemption is
provided under applicable treaty law. Nonresident stockholders are urged to
consult their own tax advisors concerning the applicability of the United
States withholding tax.

     Under certain Code provisions, some stockholders may be subject to a
backup withholding tax on certain ordinary income dividends and on capital
gain dividends ("backup withholding"). Generally, stockholders subject to
backup withholding are those for whom no certified taxpayer identification
number is on file with the Fund or who, to the Fund's knowledge , have
furnished an incorrect number.

     This section summarizes some of the consequences under current Federal
income tax law of an investment in the Fund. It is not a substitute for
personal tax advice. Fund stockholders are urged to consult their own tax
advisors to determine the Federal income tax as well as state and local tax
consequences to them of the ownership of stock of the Fund. See "Taxation" in
the Statement of Additional Information.

                    CUSTODIAN, TRANSFER AGENT AND REGISTRAR

     State Street Bank and Trust Company, Two Heritage Drive, North Quincy,
Massachusetts 02171, acts as custodian of the cash and other assets of the
Fund. Equiserve Trust Company, N.A., 225 Franklin Street, Boston,
Massachusetts 02110, acts as transfer agent and registrar for the Fund's
shares and as Plan Agent under its Plan. Stockholder inquiries should be
directed to P.O. Box 8200, Boston, Massachusetts 02266-8200 (Tel. No. (800)
426-5523).

                                    EXPERTS

     Tait, Weller & Baker, independent auditors, are the independent auditors
of the Fund. The audited financial statements of the Fund and certain of the
information appearing under the caption "Financial Highlights"



                                      30
<PAGE>

included in this Prospectus have been audited by Tait, Weller & Baker and
Ernst & Young LLP for the periods indicated in their reports with respect
thereto, and are included in reliance upon such reports and upon the authority
of such firms as experts in accounting and auditing. Tait, Weller & Baker has
an office at 1818 Market Street, Suite 2400, Philadelphia, Pennsylvania 19103,
and also performs tax and other professional services for the Fund. Ernst &
Young LLP has an office at 5 Times Square, New York, New York 10036.

                            ADDITIONAL INFORMATION

     A Statement of Additional Information dated February __, 2003 has been
filed with the SEC and is incorporated by reference in this Prospectus. The
Table of Contents of the Statement of Additional Information is as follows:

<TABLE>
<CAPTION>
                                                                                  Page
                                                                                  ----
<S>                                                                               <C>
Risk Factors and Special Considerations.......................................
Investment Restrictions.......................................................
Principal Stockholders........................................................
Directors and Officers........................................................
Code of Ethics and Related Matters............................................
Investment Advisory and Other Services........................................
Taxation......................................................................
Brokerage Allocation and Other Practices......................................
Net Asset Value...............................................................
Financial Statements..........................................................
</TABLE>



                                      31
<PAGE>

<TABLE>
<CAPTION>
======================================================        ========================================================

<S>                                                           <C>
     You should rely only on the information                                 __________ Shares of
contained in this Prospectus and the related                                 Common Stock Issuable
Statement of Additional Information. We have not                                Upon Exercise of
authorized any other person to provide you with                             Non-Transferable Rights
different information. If anyone provides you with                           to Subscribe for such
different or inconsistent information, you should                            Shares of Common Stock
not rely on it. We are not making an offer to sell
these securities in any jurisdiction where the offer
or sale is not permitted. You should assume that
the information appearing in this Prospectus and the
related Statement of Additional Information is
accurate only as of the date on the front covers of
this Prospectus and the related Statement of
Additional Information. Our business, financial
condition, results of  operations  and prospects may
have changed since that date.
                ____________________
                                                                              ROYCE VALUE TRUST, INC.
                  TABLE OF CONTENTS
                                                 Page
                                                 ----
Prospectus Summary...........................    3
Fund Expenses................................    7
Financial Highlights.........................    8
Investment Performance.......................   10
The Offer....................................   11
Use of Proceeds..............................   17                                _______________
Investment Goal and Policies.................   17
Investment Advisory and Other Services.......   21                                  PROSPECTUS
Description of Capital Stock.................   23                                _______________
Repurchase of Securities.....................   28
Dividends, Distributions and
 Reinvestment Plan...........................   29
Taxation.....................................   30
Custodian, Transfer Agent and Registrar......   30                               January __, 2003
Experts......................................   30
Additional Information.......................   31

======================================================        ========================================================
</TABLE>

<PAGE>

THE INFORMATION CONTAINED IN THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT
COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE
REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS
EFFECTIVE. THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS.



                             Subject to Completion
             Preliminary Statement of Additional Information Dated
                                January 3, 2003

                            ROYCE VALUE TRUST, INC.

                      STATEMENT OF ADDITIONAL INFORMATION


     ROYCE VALUE TRUST, INC. (the "Fund") is a closed-end diversified
management investment company, whose shares of Common Stock are listed on the
New York Stock Exchange under the symbol "RVT." Its primary investment
objective is long-term capital appreciation, with current income as a
secondary objective.

     This Statement of Additional Information is not a prospectus, but should
be read in conjunction with the Fund's Prospectus dated January __, 2003.
Please retain this document for future reference. To obtain a copy of the
Prospectus or the Fund's Annual Report to Stockholders for the year ended
December 31, 2001, Semi-Annual Report to Stockholders for the six months ended
June 30, 2002 or Annual Report to Stockholders for the year ended December 31,
2002 (which is expected to be mailed to stockholders and available on the
Fund's website (www.roycefunds.com) on or around February 28, 2003), please
call Investor Information at 1-800-221-4268.


                               TABLE OF CONTENTS
                                                           Page
                                                           ----
Risk Factors and Special Considerations...................
Investment Restrictions...................................
Principal Stockholders....................................
Directors and Officers....................................
Code of Ethics and Related Matters........................
Investment Advisory and Other Services....................
Taxation..................................................
Brokerage Allocation and Other Practices..................
Net Asset Value...........................................
Financial Statements......................................







                               January __, 2003



<PAGE>

                    RISK FACTORS AND SPECIAL CONSIDERATIONS

Fund's Rights as Stockholder

     The Fund may not invest in a company for the purpose of exercising
control of management. However, the Fund may exercise its rights as a
stockholder and communicate its views on important matters of policy to
management, the board of directors and/or stockholders if Royce & Associates,
LLC (which term as used in this Statement of Additional Information includes
its corporate predecessor) ("Royce" or the "Investment Adviser") or the Board
of Directors determines that such matters could have a significant effect on
the value of the Fund's investment in the company. The activities that the
Fund may engage in, either individually or in conjunction with others, may
include, among others, supporting or opposing proposed changes in a company's
corporate structure or business activities; seeking changes in a company's
board of directors or management; seeking changes in a company's direction or
policies; seeking the sale or reorganization of a company or a portion of its
assets; or supporting or opposing third party takeover attempts. This area of
corporate activity is increasingly prone to litigation, and it is possible
that the Fund could be involved in lawsuits related to such activities. Royce
will monitor such activities with a view to mitigating, to the extent
possible, the risk of litigation against the Fund and the risk of actual
liability if the Fund is involved in litigation. However, no assurance can be
given that litigation against the Fund will not be undertaken or liabilities
incurred.

     The Fund may, at its expense or in conjunction with others, pursue
litigation or otherwise exercise its rights as a security holder to seek to
protect the interests of security holders if Royce and the Board of Directors
determine this to be in the best interests of the Fund's stockholders.

High-Yield and Investment Grade Debt Securities

     The Fund may invest up to 5% of its net assets in high-yield,
non-convertible debt securities. They may be rated from Ba to Ca by Moody's or
from BB to D by Standard & Poor's ("S&P") or may be unrated. These securities
have poor protection with respect to the payment of interest and repayment of
principal and may be in default as to the payment of principal or interest.
These securities are often speculative and involve greater risk of loss or
price changes due to changes in the issuer's capacity to pay. The market
prices of high-yield debt securities may fluctuate more than those of
higher-rated debt securities and may decline significantly in periods of
general economic difficulty, which may follow periods of rising interest
rates.

     The market for high-yield debt securities may be thinner and less active
than that for higher-rated debt securities, which can adversely affect the
prices at which the former are sold. If market quotations cease to be readily
available for a high-yield debt security in which the Fund has invested, the
security will then be valued in accordance with procedures established by the
Board of Directors. Judgment may play a greater role in valuing high-yield
debt securities than is the case for securities for which more external
sources for quotations and last sale information are available. Adverse
publicity and changing investor perceptions may affect the Fund's ability to
dispose of high-yield debt securities.

     Since the risk of default is higher for high-yield debt securities,
Royce's research and credit analysis may play an important part in managing
securities of this type for the Fund. In considering such investments for the
Fund, Royce will attempt to identify those issuers of high-yield debt
securities whose financial condition is adequate to meet future obligations,
has improved or is expected to improve in the future. Royce's analysis may
focus on relative values based on such factors as interest or dividend
coverage, asset coverage, earnings prospects and the experience and managerial
strength of the issuer.

     The Fund may also invest in non-convertible debt securities in the lowest
rated category of investment grade debt. Such securities may have speculative
characteristics, and adverse changes in economic conditions or other
circumstances are more likely to lead to a weakened capacity to make principal
and interest payments than is the case with higher grade securities.

     The Fund may also invest in higher rated investment grade non-convertible
debt securities. Such securities include those rated Aaa by Moody's or AAA by
S&P (which are considered to be of the highest credit quality and where the
capacity to pay interest and repay principal is extremely strong), those rated
Aa by Moody's or AA by



                                     B-2
<PAGE>

S&P (where the capacity to repay principal is considered very strong, although
elements may exist that make risks appear somewhat larger than expected with
securities rated Aaa or AAA), securities rated A by Moody's or A by S&P (which
are considered to possess adequate factors giving security to principal and
interest) and securities rated Baa by Moody's or BBB by S&P (which are
considered to have an adequate capacity to pay interest and repay principal,
but may have some speculative characteristics).

Foreign Investments

     The Fund may invest up to 10% of its total assets in the securities of
foreign issuers. Foreign investments involve certain risks which typically are
not present in securities of domestic issuers. There may be less information
publicly available about a foreign company than a domestic company; foreign
companies may not be subject to accounting, auditing and reporting standards
and requirements comparable to those applicable to domestic companies; and
foreign markets, brokers and issuers are generally subject to less extensive
government regulation than their domestic counterparts. Markets for foreign
securities may be less liquid and may be subject to greater price volatility
than those for domestic securities. Foreign brokerage commissions and
custodial fees are generally higher than those in the United States. Foreign
markets also have different clearance and settlement procedures, and in
certain markets there have been times when settlements have been unable to
keep pace with the volume of securities transactions, thereby making it
difficult to conduct such transactions. Delays or problems with settlements
might affect the liquidity of the Fund's portfolio. Foreign investments may
also be subject to local economic and political risks, political, economic and
social instability, military action or unrest or adverse diplomatic
developments, and possible nationalization of issuers or expropriation of
their assets, which might adversely affect the Fund's ability to realize on
its investment in such securities. Royce may not be able to anticipate these
potential events or counter their effects. Furthermore, some foreign
securities are subject to brokerage taxes levied by foreign governments, which
have the effect of increasing the cost of such investment and reducing the
realized gain or increasing the realized loss on such securities at the time
of sale. Foreign markets may also give less protection to investors such as
the Fund.

     Although changes in foreign currency rates may adversely affect the
Fund's foreign investments, Royce does not expect to purchase or sell foreign
currencies for the Fund to hedge against declines in the U.S. dollar or to
lock in the value of any foreign securities it purchases for the Fund.
Consequently, the risks associated with such investments may be greater than
if the Fund were to engage in foreign currency transactions for hedging
purposes.

     Exchange control regulations in such foreign markets may also adversely
affect the Fund's foreign investments, and the Fund's ability to make certain
distributions necessary to maintain its eligibility as a regulated investment
company and avoid the imposition of income and excise taxes may, to that
extent, be limited.

     The considerations noted above are generally intensified for investments
in developing countries. Developing countries may have relatively unstable
governments, economies based on only a few industries and securities markets
that trade a small number of securities.

     The Fund may purchase the securities of foreign companies in the form of
American Depositary Receipts (ADRs). ADRs are certificates held in trust by a
bank or similar financial institution evidencing ownership of securities of a
foreign-based issuer. Designed for use in U.S. securities markets, ADRs are
alternatives to the purchase of the underlying foreign securities in their
national markets and currencies.

     Depositories may establish either unsponsored or sponsored ADR
facilities. While ADRs issued under these two types of facilities are in some
respects similar, there are distinctions between them relating to the rights
and obligations of ADR holders and the practices of market participants. A
depository may establish an unsponsored facility without participation by (or
even necessarily the acquiescence of) the issuer of the deposited securities,
although typically the depository requests a letter of non-objection from such
issuer prior to the establishment of the facility. Holders of unsponsored ADRs
generally bear all the costs of such facilities. The depository usually
charges fees upon the deposit and withdrawal of the deposited securities, the
conversion of dividends into U.S. dollars, the disposition of non-cash
distributions and the performance of other services. The depository of an
unsponsored facility frequently is under no obligation to distribute
stockholder communications received from the issuer of the deposited
securities or to pass through voting rights to ADR holders in respect of the
deposited securities. Depositories create sponsored ADR facilities in
generally the same manner as unsponsored



                                     B-3
<PAGE>

facilities, except that the issuer of the deposited securities enters into a
deposit agreement with the depository. The deposit agreement sets out the
rights and responsibilities of the issuer, the depository and the ADR holders.
With sponsored facilities, the issuer of the deposited securities generally
will bear some of the costs relating to the facility (such as deposit and
withdrawal fees). Under the terms of most sponsored arrangements, depositories
agree to distribute notices of stockholder meetings and voting instructions
and to provide stockholder communications and other information to the ADR
holders at the request of the issuer of the deposited securities.

Repurchase Agreements

     In a repurchase agreement, the Fund in effect makes a loan by purchasing
a security and simultaneously committing to resell that security to the seller
at an agreed upon price on an agreed upon date within a number of days
(usually not more than seven) from the date of purchase. The resale price
reflects the purchase price plus an agreed upon incremental amount which is
unrelated to the coupon rate or maturity of the purchased security. A
repurchase agreement requires or obligates the seller to pay the agreed upon
price, which obligation is in effect secured by the value (at least equal to
the amount of the agreed upon resale price and marked to market daily) of the
underlying security.

     The Fund may engage in repurchase agreements, provided that such
agreements are collateralized by cash or securities issued by the U.S.
Government or its agencies having a value at least equal to the amount loaned.
Repurchase agreements could involve certain risks if the custodian defaults or
becomes insolvent, including possible delays or restrictions upon the Fund's
ability to dispose of collateral. While it does not presently appear possible
to eliminate all risks from these transactions (particularly the possibility
of a decline in the market value of the underlying securities, as well as
delays and costs to the Fund in connection with bankruptcy proceedings), it is
the policy of the Fund to enter into repurchase agreements only with its
custodian, State Street Bank and Trust Company, and having a term of seven
days or less.

Warrants, Rights and Options

     The Fund may invest up to 5% of its total assets in warrants, rights and
options. A warrant, right or call option entitles the holder to purchase a
given security within a specified period for a specified price and does not
represent an ownership interest. A put option gives the holder the right to
sell a particular security at a specified price during the term of the option.
These securities have no voting rights, pay no dividends and have no
liquidation rights. In addition, their market prices do not necessarily move
parallel to the market prices of the underlying securities.

     The sale of warrants, rights or options held for more than one year
generally results in a long-term capital gain or loss to the Fund, and the
sale of warrants, rights or options held for one year or less generally
results in a short term capital gain or loss. The holding period for
securities acquired upon exercise of a warrant, right or call option, however,
generally begins on the day after the date of exercise, regardless of how long
the warrant, right or option was held. The securities underlying warrants,
rights and options could include shares of common stock of a single company or
securities market indices representing shares of the common stocks of a group
of companies, such as the S&P 600 SmallCap Stock Price Index "S&P 600 Index").

     Investing in warrants, rights and call options on a given security allows
the Fund to hold an interest in that security without having to commit assets
equal to the market price of the underlying security and, in the case of
securities market indices, to participate in a market without having to
purchase all of the securities comprising the index. Put options, whether on
shares of common stock of a single company or on a securities market index,
would permit the Fund to protect the value of a portfolio security against a
decline in its market price and/or to benefit from an anticipated decline in
the market price of a given security or of a market. Thus, investing in
warrants, rights and options permits the Fund to incur additional risk and/or
to hedge against risk.

Risks to Common Stockholders of Borrowing Money and Issuing Senior Securities

     Asset Coverage Test. Section 18(a)(1) of the Investment Company Act of
1940, as amended (the "1940 Act") permits a registered closed-end company such
as the Fund to issue and sell a class of senior securities (such as the Issued
Preferred) only if, immediately after such issuance and sale, the net asset
value ("NAV") of



                                     B-4
<PAGE>

the Fund's portfolio is at least 200% of the liquidation preference of the
Issued Preferred. Section 18(g) of the 1940 Act defines a senior security to
mean any stock of a class having priority over any other class as to
distribution of assets or payment of dividends. Under Section 18(h) of the
1940 Act, asset coverage of a class of senior securities of an issuer which is
a stock means the ratio which the value of the issuer's total assets, less all
of its liabilities and indebtedness not represented by senior securities,
bears to the aggregate amount of the issuer's senior securities representing
indebtedness plus the aggregate of the involuntary liquidation preference of
such class of senior security which is a stock. Section 18(a)(1) of the 1940
Act also prevents the Fund from declaring any cash or other non-stock
dividends or distributions on its Common Stock or purchasing any shares of its
capital stock if, immediately thereafter, the NAV of the Fund's portfolio
(determined after deducting the amount of such dividend or distribution) is at
least 200% of the liquidation preference of its outstanding Preferred Stock.

     If the asset coverage for outstanding Preferred Stock as of the last day
of March, June, September or December in any calendar year should fall below
200%, the Fund would redeem such Preferred Stock at a price equal to its
liquidation preference plus accumulated but unpaid dividends to the date of
redemption and/or any other senior securities of the Fund then outstanding to
the extent necessary to restore such asset coverage to at least 200%. See
"Description of Capital Stock - Preferred Stock - Redemption" in the
Prospectus.

     The Articles Supplementary governing the Issued Preferred (the "Articles
Supplementary") contains more restrictive provisions concerning the Fund's
obligation to maintain asset coverage for the Issued Preferred than those
required by Section 18(a)(1) of the 1940 Act. See "Description of Capital
Stock-Preferred Stock-Rating Agency Guidelines" in the Prospectus.


                               ________________


     Royce believes that the Fund is suitable for investment only by persons
who can invest without concern for current income, and that the Fund is
suitable only for those investors who are in a financial position to assume
above-average risks in search for long-term capital appreciation.

                            INVESTMENT RESTRICTIONS

     The policies set forth below are fundamental policies of the Fund and may
not be changed without the affirmative vote of the holders of a majority of
the Fund's outstanding voting securities, as set forth under "Investment Goal
and Policies-Changes in Investment Objectives and Policies" in the Prospectus.
The Fund may not:

     1.   Issue any class of senior security, or sell any such security of
          which it is the issuer, except as permitted by the 1940 Act.

     2.   Purchase on margin or write call options on its portfolio
          securities.

     3.   Sell securities short.

     4.   Underwrite the securities of other issuers, or invest in restricted
          securities unless such securities are redeemable shares issued by
          money market funds registered under the 1940 Act.

     5.   Invest more than 25% of its total assets in any one industry.

     6.   Purchase or sell real estate or real estate mortgage loans, or
          invest in the securities of real estate companies unless such
          securities are publicly-traded.

     7.   Purchase or sell commodities or commodity contracts.

     8.   Make loans, except for (a) purchases of portions of issues of
          publicly-distributed bonds, debentures and other securities, whether
          or not such purchases are made on the original issuance



                                     B-5
<PAGE>

          of such securities, (b) repurchase agreements with any bank that is
          the custodian of its assets covering U.S. Treasury and agency
          obligations and having a term of not more than one week and (c)
          loans of up to 25% of its assets to qualified brokers, dealers or
          institutions for their use relating to short sales or other security
          transactions (provided that such loans are secured by collateral
          equal at all times to at least 100% of the value of the securities
          loaned).

     9.   Invest in companies for the purpose of exercising control of
          management.

     10.  Purchase portfolio securities from or sell such securities directly
          to any of its officers, directors, employees or investment adviser,
          as principal for their own accounts.

     11.  Invest in the securities of any one issuer (other than the United
          States or any agency or instrumentality of the United States) if, at
          the time of acquisition, the Fund would own more than 10% of the
          voting securities of such issuer or, as to 75% of the Fund's total
          assets, more than 5% of such assets would be invested in the
          securities of such issuer.

     12.  Invest more than 5% of its total assets in warrants, rights or
          options.

     If a percentage restriction is met at the time of investment, a later
increase or decrease in percentage resulting from a change in the value of
portfolio securities or amount of total assets is not considered a violation
of any of the above restrictions.

     In addition to issuing and selling senior securities as set forth in No.
1 above, the Fund may obtain (i) temporary bank borrowings (not in excess of
5% of the value of its total assets) for emergency or extraordinary purposes
and (ii) such short-term credits (not in excess of 5% of the value of its
total assets) as are necessary for the clearance of securities transactions.
Under the 1940 Act and the Articles Supplementary, such temporary bank
borrowings would be treated as indebtedness in determining whether or not
asset coverage was at least 200% for senior securities of the Fund
representing indebtedness.

     Although there are no liquidity restrictions on investments made by the
Fund and the Fund may, therefore, invest without limit in illiquid securities,
the Fund expects to invest only in securities for which market quotations are
readily available.


                            PRINCIPAL STOCKHOLDERS

     As of January 28, 2003, the Record Date, there were _________ shares of
Common Stock and 6,400,000 shares of Preferred Stock of the Fund outstanding.
The following persons were known to the Fund to be beneficial owners or owners
of record of 5% or more of its outstanding shares of Common Stock or Preferred
Stock as of the Record Date:

<TABLE>
<CAPTION>
    Name and Address of                                                  Amount and Nature           Percent of
           Owner                      Class/Series of Stock                 of Ownership             Class/Series
  ---------------------------     -----------------------------   ---------------------------     ----------------------

  <S>                             <C>                             <C>                             <C>
  Cede & Co.*                              Common Stock           _________ shares--Record              _____%
  Depository Trust Company
  P.O. Box #20
  Bowling Green Station               7.80% Cumulative Preferred  _________ shares--Record              _____%
  New York, NY 10028                           Stock
  New York, NY 10028

                                       7.30% Tax-Advantaged       _________ shares--Record              _____%
                                    Cumulative Preferred Stock

</TABLE>
_______________
*  Shares held by brokerage firms, banks and other financial intermediaries on
   behalf of beneficial owners are registered in the name of Cede & Co.



                                     B-6
<PAGE>

                            DIRECTORS AND OFFICERS

     The Board of Directors of the Fund is comprised of the eight individuals
named below. Two of the Directors, William L. Koke and David L. Meister, are
elected annually by the holders of Issued Preferred, voting as a separate
class. The remaining six Directors are divided into three classes and are
elected by the holders of Common Stock and Issued Preferred, voting together
as a single class. The Class I Directors, Charles M. Royce and G. Peter
O'Brien, have terms that expire in 2003; the Class II Directors, Mark R.
Fetting and Richard M. Galkin, have terms that expire in 2004; and the Class
III Directors, Donald R. Dwight and Stephen L. Isaacs, have terms that expire
in 2005. To the extent permitted by the 1940 Act and Maryland law, vacancies
on the Board can be filled by the remaining Directors for the remainder of the
term of the respective Board position.

     There are no family relationships between any of the Fund's Directors and
officers. Each Director will hold office until his term expires and his
successor has been duly elected or until his earlier resignation or removal.
Each of the Fund's Directors is also a director/trustee of the other
management investment companies comprising The Royce Funds, which have
seventeen portfolios.

Directors

     Interested Directors. Certain biographical and other information
concerning the Directors who are "interested persons" as defined in the 1940
Act, of the Fund, including their designated classes, is set forth below.
Officers are elected by and serve at the pleasure of the Board of Directors.
Each officer will hold office for the year ending December 31, 2003, and
thereafter until his respective successor is duly elected and qualified.

<TABLE>
<CAPTION>

                                    Term Of                                                           Other Public
                                   Office And                                                           Company
  Name, Age And     Position(s)    Length Of                                                         Directorships
    Address*       With The Fund  Time Served     Principal Occupations During Past Five Years      Held by Director
- ----------------  --------------- ------------  -----------------------------------------------   --------------------
   <S>             <C>            <C>           <C>                                               <C>

   Charles M.         Class I       Term as     President, Chief Investment Officer and                   None
     Royce**       Director and     Director    Manager/Director of Royce; and President of The
      (63)           President      expires     Royce Funds.
                                     2003;
                                    Director
                                  and Officer
                                   since 1986

   Mark R.           Class II       Term as     Executive Vice President of Legg Mason;               Director of
   Fetting**         Director       Director    Manager/Director of Royce; and Division                registered
    (48)                            expires     President and Senior Officer of Prudential             investment
                                     2004;      Financial Group, Inc. and related companies,           companies
                                    Director    including Fund Boards and consulting services to   constituting four
                                   since 2001   subsidiary companies (from 1991 to 2000). Mr.       Legg Mason Funds
                                                Fetting's prior business experience also
                                                includes having served as Partner, Greenwich
                                                Associates, and Vice President, T. Rowe Price
                                                Group, Inc.
</TABLE>
_________
*     Mr. Royce's address is c/o Royce, 1414 Avenue of the Americas, New York,
      New York 10019.  Mr. Fetting's address is c/o Legg Mason, 100 Light
      Street, Baltimore, Maryland 21202.
**    Messrs. Royce and Fetting are "interested persons" of the Fund within the
      meaning of Section 2(a)(19) of the 1940 Act due to the positions they hold
      with Royce and for Mr. Fetting, Legg Mason, and their ownership in Legg
      Mason.



                                     B-7
<PAGE>

     Non-Interested Directors. Certain biographical and other information
concerning the Fund Directors who are not "interested persons," as defined in
the 1940 Act, of the Fund, including their designated classes, is set forth
below. Each non-interested Director is also a member of the Fund's audit
committee.

<TABLE>
<CAPTION>
                                    Term Of                                                           Other Public
                                   Office And                                                           Company
  Name, Age And     Position(s)    Length Of                                                         Directorships
    Address*       With The Fund  Time Served     Principal Occupations During Past Five Years      Held by Director
- ----------------  --------------- ------------  -----------------------------------------------   --------------------
   <S>             <C>            <C>           <C>                                               <C>

 Donald R. Dwight     Class III       Term as    President of Dwight Partners, Inc., corporate      Trustee of the
       (71)            Director      Director    communications consultants; and Chairman (from       registered
                                      expires    1982 until March 1998) of Newspapers New             investment
                                       2005;     England, Inc. Mr. Dwight's prior experience           companies
                                     Director    includes having served as Lieutenant Governor     constituting the
                                    since 1998   of the Commonwealth of Massachusetts and as        94 Eaton Vance
                                                 President and Publisher of Minneapolis Star and         Funds
                                                 Tribune Company.

  Richard M. Galkin    Class II       Term as    Private investor.  Mr. Galkin's prior business          None
       (64)            Director      Director    experience includes having served as President
                                      expires    of Richard M. Galkin Associates, Inc.,
                                       2004;     telecommunications consultants, President of
                                     Director    Manhattan Cable Television (a subsidiary of
                                    since 1986   Time Inc.), President of Haverhills Inc.
                                                 (another Time Inc. subsidiary), President of
                                                 Rhode Island Cable Television and Senior Vice
                                                 President of Satellite Television Corp. (a
                                                 subsidiary of Comsat).

  Stephen L. Isaacs   Class III       Term as    President of The Center for Health and Social           None
       (63)            Director      Director    Policy (since September 1996); Attorney and
                                      expires    President of Health Policy Associates, Inc.,
                                       2005;     consultants. Mr. Isaacs' prior experience
                                     Director    includes having served as Director of Columbia
                                    since 1986   University Development Law and Policy Program
                                                 and Professor at Columbia University.

  William L. Koke      Director       Term as    Financial planner with Shoreline Financial              None
       (68)           elected by     Director    Consultants. Mr. Koke's prior business
                      Preferred       expires    experience includes having served as Director
                     Stockholders    annually;   of Financial Relations of SONAT, Inc.,
                                     Director    Treasurer of Ward Foods, Inc. and President of
                                    since 2001   CFC, Inc.
</TABLE>



                                     B-8
<PAGE>

<TABLE>
<CAPTION>
                                    Term Of                                                           Other Public
                                   Office And                                                           Company
  Name, Age And     Position(s)    Length Of                                                         Directorships
    Address*       With The Fund  Time Served     Principal Occupations During Past Five Years      Held by Director
- ----------------  --------------- ------------  -----------------------------------------------   --------------------
   <S>             <C>            <C>           <C>                                               <C>
 David L. Meister      Director       Term as    Chairman and Chief Executive Officer of The             None
       (63)           elected by     Director    Tennis Channel (since June 2000); and Chief
                      Preferred       expires    Executive Officer of Seniorlife.com (from
                     Stockholders    annually;   December 1999 to May 2000). Mr. Meister's prior
                                     Director    business experience includes having served as a
                                    since 1986   consultant to the communications industry,
                                                 President of Financial News Network, Senior Vice
                                                 President of HBO, President of Time-Life Films
                                                 and Head of Broadcasting for Major League
                                                 Baseball.

 G. Peter O'Brien      Class I        Term as    Trustee of Colgate University, Director of            Director/
       (57)            Director      Director    Pinnacle Holdings, Inc., President of Hill         Trustee of the
                                      expires    House, Inc. and Managing Director/Equity             registered
                                       2003;     Capital Markets Group of Merrill Lynch & Co.         investment
                                     Director    (from 1971 to 1999).                                  companies
                                    since 2001                                                     constituting the
                                                                                                     18 Legg Mason
                                                                                                    Funds; Director
                                                                                                    of Renaissance
                                                                                                        Capital
                                                                                                    Greenwich Fund.
</TABLE>

_________
*  Messrs. Dwight, Galkin, Isaacs, Koke, Meister and O'Brien's address is
   c/o Royce, 1414 Avenue of the Americas, New York, New York 10019.

Officers

     Certain biographical and other information concerning the officers of the
Fund is set forth below. Officers are elected by and serve at the pleasure of
the Board of Directors. Each officer will hold office for the year ending
December 31, 2003, and thereafter until his respective successor is duly
elected and qualified.

<TABLE>
<CAPTION>
                                                Term Of Office
                                Position(s)      And Length Of            Principal Occupations During
   Name, Age And Address*      With The Fund      Time Served                    Past Five Years
- ---------------------------  -----------------  ---------------  ------------------------------------------------
<S>                          <C>                <C>              <C>

   John D. Diederich (50)     Vice President,    Officer since   Manager/Director, Chief Operating Officer
                                Director of          2001        (since October 2001), Chief Financial Officer
                               Administration                    (since  March  2002) and  Managing  Director of
                               and Treasurer                     Royce;  Vice President, Treasurer and Director
                                                                 of  Administration of the other Royce Funds;
                                                                 and President of Royce Fund Services, Inc.

   Jack E. Fockler, Jr. (43)   Vice President    Officer since   Managing  Director and Vice President of Royce;
                                                     1995        Vice President of The Royce Funds.
</TABLE>



                                     B-9
<PAGE>

<TABLE>
<CAPTION>
                                                Term Of Office
                                Position(s)      And Length Of            Principal Occupations During
   Name, Age And Address*      With The Fund      Time Served                    Past Five Years
- ---------------------------  -----------------  ---------------  ------------------------------------------------
<S>                          <C>                <C>              <C>
   W. Whitney George (43)      Vice President    Officer since   Managing  Director and Vice President of Royce;
                                                     1995        and Vice President of The Royce Funds.

   Daniel A. O'Byrne (40)      Vice President    Officer since   Principal  and Vice  President  of  Royce;  and
                               and Assistant         1994        Vice President of The Royce Funds.
                                 Secretary

    John E. Denneen (35)       Secretary and     Officer from    General  Counsel of Royce (since January 2003);
                              General Counsel    1996 to 2001    Deputy  General   Counsel,   Principal,   Chief
                                                   and since     Compliance   Officer  and  Secretary  of  Royce
                                                  April 2002     (since  March  2002);  Secretary  of The  Royce
                                                                 Funds   (1996-2001   and  since  April   2002);
                                                                 Associate General Counsel,  Principal and Chief
                                                                 Compliance  Officer of Royce  (1996-2001);  and
                                                                 Principal   of  Credit   Suisse   First  Boston
                                                                 Private Equity (2001-2002).
</TABLE>
_______________
*   The address of each officer is c/o Royce, 1414 Avenue of the Americas, New
    York, New York 10019.

Ownership of Securities

     Information relating to each Director's share ownership in the Fund and
in The Royce Funds as of December 31, 2002 is set forth in the tables below.

<TABLE>
<CAPTION>
                                           Aggregate Dollar Range of Equity       Aggregate Dollar Range of Equity
                 Name                           Securities in the Fund              Securities in The Royce Funds
                 ----                           ----------------------              -----------------------------
<S>                                       <C>                                     <C>


Interested Directors
     Charles M. Royce..................       $                                             Over $100,000
     Mark R. Fetting...................       $                                             Over $100,000

Non-Interested Directors
     Donald R. Dwight..................       $                                             Over $100,000
     Richard M. Galkin.................       $                                             Over $100,000
     Stephen L. Isaacs.................       $                                            $10,001-$50,000
     William L. Koke...................       $                                             Over $100,000
     David L. Meister..................       $                                             Over $100,000
     G. Peter O'Brien..................       $                                             Over $100,000
</TABLE>

Board Committees and Meetings

     The Board of Directors has an Audit Committee, comprised of Donald R.
Dwight, Richard M. Galkin, Stephen L. Isaacs, William L. Koke, David L.
Meister and G. Peter O'Brien. The Audit Committee is responsible for, among
other things, recommending the selection and nomination of the Fund's
independent accountants and for conducting post-audit reviews of the Fund's
financial condition with such independent accountants. The Fund has adopted an
Audit Committee charter. Mr. Galkin serves as Chairman of the Audit Committee.
The members of the Audit Committee are "independent" within the meaning of the
1940 Act and the New York Stock Exchange corporate governance standards for
audit committees. The Fund's Audit Committee held three meetings during the
year ended December 31, 2002. Although the Board of Directors does not have a
standing compensation committee or a nominating committee, the non-interested
Directors review and nominate candidates to serve as



                                     B-10
<PAGE>

non-interested Directors. The non-interested Directors generally will not
consider nominees recommended by stockholders of the Fund.

Compensation of Directors and Certain Officers

     For the year ended December 31, 2002, the following Directors and
affiliated persons (who received more than $60,000) of the Fund received
compensation from the Fund and The Royce Funds, as follows:

<TABLE>
<CAPTION>
                           Aggregate      Pension or Retirement         Estimated           Total Compensation
                         Compensation      Benefits Accrued as       Annual Benefits       from The Royce Funds
         Name              from Fund      Part of Fund Expenses      upon Retirement        paid to Directors
         ----              ---------      ---------------------      ---------------        -----------------
<S>                      <C>              <C>                        <C>                   <C>

Donald R. Dwight,                                  None                    None
Director1

Richard M. Galkin,                                 None                    None
Director2

Stephen L. Isaacs,                                 None                    None
Director

William L. Koke,                                   None                    None
Director

David L. Meister,                                  None                    None
Director


G. Peter O'Brien,                                  None                    None
Director

John D. Diederich,                                                         None
Vice President and
Treasurer3

John E.                                                                    None
Denneen,
Secretary
</TABLE>
______________
1    Includes  $______ from the Fund ($_____ from the Fund and other Royce
     Funds) deferred  during 2002 at the election of Mr. Dwight under The Royce
     Funds' Deferred Compensation Plan for Trustees/Directors.
2    Includes  $______ from the Fund ($_____ from the Fund and other Royce
     Funds) deferred  during 2002 at the election of Mr. Galkin under The Royce
     Funds' Deferred Compensation Plan for Trustees/Directors.
3    The amounts shown represent  compensation  paid to and benefits accrued
     for Mr. Diederich as a non-officer employee of the Fund.

Directors' Consideration of Investment Advisory Agreement

     The Fund's Board of Directors determined at meetings held on July 16-17,
2001 to approve the Fund's current Investment Advisory Agreement. In making
their determinations, the Directors considered a wide range of information of
the type they regularly consider when determining whether to continue the
Fund's advisory arrangements as in effect from year to year. In addition, the
Directors gave particular consideration to matters relating to the possible
effects of the October 1, 2001 acquisition of Royce by Legg Mason on Royce and
the Fund. In its consideration of the current Investment Advisory Agreement,
the Board of Directors focused on information it had received relating to,
among other things: (a) the nature, quality and extent of the advisory and
other services to be provided to the Fund by Royce, (b) comparative data with
respect to advisory fees paid by other funds with similar investment
objectives, (c) the operating expenses and expense ratio of the Fund compared
to funds with



                                     B-11
<PAGE>

similar investment objectives, (d) the performance of the Fund as compared to
such comparable funds, (e) the relative profitability of the present
arrangements and the proposed arrangements to Royce, (f) information about the
services to be performed and the personnel performing such services under the
previous Investment Advisory Agreement and the current Investment Advisory
Agreement, (g) the general reputation and financial resources of Legg Mason,
(h) compensation payable by the Fund to affiliates of Royce for other
services, (i) Royce's practices regarding the selection and compensation of
brokers that execute portfolio transactions for the Fund and the brokers'
provision of brokerage and research services to Royce, (j) the ability of
Royce to continue providing investment advisory services of the same character
and at least the same quality as provided prior to the October 1, 2001
acquisition of Royce by Legg Mason, (k) potential effect on portfolio
management or other Fund services due to new affiliates and (l) potential
effect on Fund performance. The Board of Directors was advised by separate
legal counsel in connection with its review of the Fund's investment advisory
arrangements.

     In addition, the Directors considered that the Stock Purchase Agreement
for the transaction provided that Legg Mason would (subject to certain
qualifications) use its reasonable best efforts to assure compliance with the
safe-harbor provided by Section 15(f) of the 1940 Act. Section 15(f) provides
that a registered investment company's investment adviser or its affiliates
can receive benefit or compensation in connection with a change of control of
the investment adviser (e.g., the change of control of Royce as a result of
its acquisition by Legg Mason) if two conditions are satisfied. First, for
three years after the change of control, at least 75% of the members of the
board of any registered investment company advised by the adviser must consist
of persons who are not "interested persons," as defined in the 1940 Act, of
the adviser. Second, no "unfair burden" may be imposed on any such registered
investment company as a result of the change of control transaction or any
express or implied terms, conditions or understandings applicable to the
transaction. "Unfair burden" means any arrangement, during the two years after
the transaction, by which the investment adviser or any "interested person" of
the adviser receives or is entitled to receive any compensation, directly or
indirectly, from such investment company or its security holders (other than
fees for bona fide investment advisory or other services) or from any other
person in connection with the purchase or sale of securities or other property
to, from or on behalf of such investment company.

Information Concerning Royce

     On October 1, 2001, Royce became an indirect wholly-owned subsidiary of
Legg Mason. On March 31, 2002, Royce's corporate predecessor was merged into
Royce Holdings, LLC (a wholly-owned subsidiary of Legg Mason), which then
changed its name to Royce & Associates, LLC. As a result of this merger, Royce
& Associates, LLC became the Fund's investment adviser and a direct
wholly-owned subsidiary of Legg Mason.


                      CODE OF ETHICS AND RELATED MATTERS

     Royce and the Fund have adopted a Code of Ethics under which directors
(other than non-management directors), officers and employees of Royce
("Royce-related persons") and interested trustees/directors, officers and
employees of the Fund are generally prohibited from personal trading in any
security which is then being purchased or sold or considered for purchase or
sale by the Fund or any other Royce account. The Code of Ethics permits such
persons to engage in other personal securities transactions if (i) the
securities involved are certain debt securities, money market instruments,
shares of registered open-end investment companies or shares acquired from an
issuer in a rights offering or under an automatic dividend reinvestment or
employer-sponsored automatic payroll deduction cash purchase plan, (ii) the
transactions are either non-volitional or are effected in an account over
which such person has no direct or indirect influence or control or (iii) they
first obtain permission to trade from Royce's Compliance Officer and either an
executive officer or Senior Portfolio Manager of Royce. The Code contains
standards for the granting of such permission, and permission to trade will
usually be granted only in accordance with such standards.

     Royce's clients include several private investment companies in which
Royce, Royce-related persons and/or other Legg Mason affiliates have (and,
therefore, may be deemed to beneficially own) a share of up to 15% of the
company's realized and unrealized net capital gains from securities
transactions, but less than 25% of the company's equity interests. The Code of
Ethics does not restrict transactions effected by Royce for such private
investment company accounts, and transactions for such accounts are subject to
Royce's allocation policies and procedures. See "Brokerage Allocation and
Other Practices."



                                     B-12
<PAGE>

     As of December 31, 2002, Royce-related persons, interested
trustees/directors, officers and employees of The Royce Funds and members of
their immediate families beneficially owned shares of The Royce Funds having a
total value of over $____ million, and such persons beneficially owned equity
interests in Royce-related private investment companies totaling approximately
$____ million.

                    INVESTMENT ADVISORY AND OTHER SERVICES

Advisory Fee

     As compensation for its services under the Investment Advisory Agreement,
Royce is entitled to receive a fee comprised of a Basic Fee (the "Basic Fee")
at the rate of 1% per annum of the Fund's average net assets (including
proceeds from the sale of Preferred Stock) and an adjustment to the Basic Fee
based on the investment performance of the Fund in relation to the investment
record of the S&P 600 Index. A rolling period of 60 months ending with the most
recent calendar month is utilized for measuring performance and average net
assets.

The Basic Fee for each such month will be increased or decreased at the rate
of 1/12 of .05% per percentage point, depending on the extent, if any, by
which the investment performance of the Fund exceeds by more than two
percentage points, or is exceeded by more than two percentage points by, the
percentage change in the investment record of the S&P 600 Index for the
performance period. The maximum increase or decrease in the Basic Fee for any
month is 1/12 of 0.5%. Accordingly, for each month the maximum monthly fee
rate as adjusted for performance will be 1/12 of 1.5% and will be payable if
the investment performance of the Fund exceeds the percentage change in the
investment record of the S&P 600 Index by 12 or more percentage points for the
performance period, and the minimum monthly fee rate as adjusted for
performance will be 1/12 of 0.5% and will be payable if the percentage change
in the investment record of the S&P 600 Index exceeds the investment
performance of the Fund by 12 or more percentage points for the performance
period.

     Notwithstanding the foregoing, Royce will not be entitled to receive any
fee for any month when the investment performance of the Fund for the rolling
36-month period ending with such month is negative on an absolute basis. In
the event that the Fund's investment performance for such a performance period
is less than zero, Royce will not be required to refund to the Fund any fee
earned in respect of any prior performance period.

     Because the Basic Fee is a function of the Fund's net assets and not of
its total assets, Royce will not receive any fee in respect of those assets of
the Fund equal to the aggregate unpaid principal amount of any indebtedness of
the Fund. Royce will receive a fee in respect of any assets of the Fund equal
to the liquidation preference of and any potential redemption premium for the
outstanding 7.80% Cumulative Preferred Stock, 7.30% Tax-Advantaged Cumulative
Preferred Stock and for any other Preferred Stock that may be issued and sold
by the Fund.

     The following table illustrates, on an annualized basis, the full range
of permitted increases or decreases to the Basic Fee.

<TABLE>
<CAPTION>
      Difference between Performance
      of Fund and % Change in S&P                             Adjustment to 1%
            600 Index Record                                       Basic Fee                     Fees as Adjusted
   --------------------------------------                     ------------------                ----------------
<S>       <C>                                                 <C>                               <C>

          +12 or more                                               +.5%                               1.5%
          +11                                                       +.45%                              1.45%
          +10                                                       +.4%                               1.4%
          +9                                                        +.35%                              1.35%
          +8                                                        +.3%                               1.3%
          +7                                                        +.25%                              1.25%
          +6                                                        +.2%                               1.2%
          +5                                                        +.15%                              1.15%
          +4                                                        +.1%                               1.1%
          +3                                                        +.05%                              1.05%



                                     B-13
<PAGE>

          +/-2                                                      0                                  1%
          - 3                                                      -0.5                                 .95%
          - 4                                                       -.1%                                .9%
          - 5                                                       -.15%                               .85%
          - 6                                                       -.2%                                .8%
          - 7                                                       -.25%                               .75%
          - 8                                                       -.3%                                .7%
          - 9                                                       -.35%                               .65%
          - 10                                                      -.4%                                .6%
          - 11                                                      -.45%                               .55%
          - 12 or less                                              -.5%                                .5%
</TABLE>

     In calculating the investment performance of the Fund and the percentage
change in the investment record of the S&P 600 Index, all dividends and other
distributions during the performance period are treated as having been
reinvested, and no effect is given to gain or loss resulting from capital
share transactions of the Fund. Fractions of a percentage point are rounded to
the nearest whole point (to the higher whole point if exactly one-half).

     Royce has committed to voluntarily waive the portion of its investment
advisory fee attributable to a series of Preferred Stock for any month when
the Fund's average annual net asset value total return since issuance of the
Preferred Stock fails to exceed the applicable Preferred Stock's dividend
rate.

     For the years ended December 31, 2002, 2001 and 2000, Royce received
investment advisory fees from the Fund of $__________, $__________ and
$7,342,211 (net of $__________, $__________ and $505,624 voluntarily waived by
Royce), respectively.

Other

     The Investment Advisory Agreement provides that the Fund may use "Royce"
as part of its name only for as long as the Investment Advisory Agreement
remains in effect. The name "Royce" is a property right of Royce, and it may
at any time permit others, including other investment entities, to use such
name.

     The Investment Advisory Agreement protects and indemnifies Royce against
liability to the Fund, its stockholders or others for any action taken or
omitted to be taken by Royce in connection with the performance of any of its
duties or obligations under Investment Advisory Agreement or otherwise as an
investment adviser to the Fund. However, Royce is not protected or indemnified
against liabilities to which it would otherwise be subject by reason of
willful malfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its duties and obligations
under the Investment Advisory Agreement.

     Royce's services to the Fund are not deemed to be exclusive, and Royce or
any of its affiliates may provide similar services to other investment
companies and other clients or engage in other activities.

     The Investment Advisory Agreement will remain in effect until June 30,
2003 and may be continued in effect from year to year thereafter if such
continuance is specifically approved at least annually by the Board of
Directors or by the vote of a majority of the Fund's outstanding voting
securities and, in either case, by a majority of the directors who are not
parties to the Agreement or interested persons of any such party. The
Investment Advisory Agreement will automatically terminate if it is assigned
(as defined by the 1940 Act and the rules thereunder) and may be terminated
without penalty by vote of a majority of the Fund's outstanding voting
securities or by either party thereto on not less than 60 days' written
notice.

Service Contract with State Street

     State Street Bank and Trust Company ("State Street"), the custodian of
the Fund's assets, provides certain management-related services to the Fund.
Such services include keeping books of accounts and rendering such financial
and other statements as may be requested by the Fund from time to time
generally assisting in the preparation of reports to the Fund's stockholders,
to the SEC and others and in the auditing of accounts and in other



                                     B-14
<PAGE>

ministerial matters of like nature, as agreed to between the Fund and State
Street. For the fiscal years ended December 31, 2002, 2001 and 2000, the Fund
paid $__________, $__________ and $__________ in fees to the Fund's custodian
and transfer agent.

                                   TAXATION

General

     The Fund intends to continue to qualify for the special tax treatment
afforded regulated investment companies ("RICs") under the Internal Revenue
Code of 1986, as amended (the "Code"). As long as it so qualifies, the Fund
(but not its stockholders) will not be subject to Federal income tax to the
extent that it distributes its net investment income and net realized capital
gains. The Fund intends to distribute substantially all of such income.

     The Code requires a RIC to pay a nondeductible 4% excise tax to the
extent the RIC does not distribute, during each calendar year, 98% of its
ordinary income, determined on a calendar year basis, and 98% of its capital
gains, determined, in general, on an October 31 year end, plus certain
undistributed amounts from previous years. While the Fund intends to
distribute its income and capital gains in the manner necessary to minimize
imposition of the 4% excise tax, there can be no assurance that sufficient
amounts of the Fund's taxable income and capital gains will be distributed to
avoid entirely the imposition of the tax. In such event, the Fund will be
liable for the tax only on the amount by which it does not meet the foregoing
distribution requirements.

     Dividends paid by the Fund from its ordinary income or from an excess of
net short-term capital gains over net long-term capital losses (together
referred to hereafter as "ordinary income dividends") are taxable to
stockholders as ordinary income. Distributions made from an excess of net
long-term capital gains over net short-term capital losses (including gains or
losses from certain transactions in warrants and options) ("capital gain
dividends") are taxable to stockholders as long-term capital gains, regardless
of the length of time the stockholder has owned Fund shares. Any loss upon the
sale or exchange of Fund shares held for six months or less will be treated as
long-term capital loss to the extent of any capital gain dividends received by
the stockholder. Distributions in excess of the Fund's earnings and profits
will first reduce the adjusted tax basis of a holder's shares and, after such
adjusted tax basis is reduced to zero, will constitute capital gains to such
holder (assuming the shares are held as a capital asset). Certain categories
of capital gains are taxable at different rates. Generally not later than 60
days after the close of its taxable year, the Fund will provide its
stockholders with a written notice designating the amounts of any capital gain
dividends as well as any amounts of capital gain dividends in the different
categories of capital gain referred to above.

     Dividends are taxable to stockholders even though they are reinvested in
additional shares of the Fund. A portion of the Fund's ordinary income may be
eligible for the dividends received deduction allowed to corporations under
the Code, if certain requirements are met.

     A loss realized on a sale or exchange of shares of the Fund will be
disallowed if other Fund shares are acquired (whether through the automatic
reinvestment of dividends or otherwise) within a 61-day period beginning 30
days before and ending 30 days after the date that the shares are disposed of.
In such a case, the basis of the shares acquired will be adjusted to reflect
the disallowed loss.

     The IRS has taken the position in a revenue ruling that if a RIC has two
or more classes of shares, it may designate distributions made to each class
in any year as consisting of no more than such class' proportionate share of
particular types of income, including exempt interest and net long-term
capital gains. A class's proportionate share of a particular type of income is
determined according to the percentage of total dividends paid by the RIC
during such year that was paid to such class. Thus, the Fund is required to
allocate a portion of its net capital gains and other taxable income to the
shares of Preferred Stock.

     If at any time when shares of Preferred Stock are outstanding the Fund
does not meet the asset coverage requirements of the 1940 Act, the Fund will
be required to suspend distributions to holders of Common Stock until the
asset coverage is restored. See "Risk Factors and Special Considerations -
Risks to Common Stockholders of Borrowing Money and Issuing Senior Securities
- - Asset Coverage Test." This may prevent the Fund from



                                     B-15
<PAGE>

distributing at least 90% of its net income and may, therefore, jeopardize the
Fund's qualification for taxation as a RIC. Upon any failure to meet the asset
coverage requirements of the 1940 Act, the Fund, in its sole discretion, may,
and under certain circumstances will be required to, redeem shares of
Preferred Stock in order to maintain or restore the requisite asset coverage
and avoid the adverse consequences to the Fund and its stockholders of failing
to qualify as a RIC. See "Description of Capital Stock -- Preferred Stock --
Redemption" in the Prospectus. There can be no assurance, however, that any
such action would achieve such objectives.

     The Fund may invest in securities rated in the medium to lower rating
categories of nationally recognized rating organizations, and in unrated
securities ("high yield bonds"), as previously described. Some of these high
yield bonds may be purchased at a discount and may therefore cause the Fund to
accrue and distribute income before amounts due under the obligations are
paid. In addition, a portion of the interest payments on such high yield
securities may be treated as dividends for Federal income tax purposes; in
such case, if the issuer of such high yield/high risk securities is a domestic
corporation, dividend payments by the Fund will be eligible for the dividends
received deduction to the extent of the deemed dividend portion of such
interest payments.

     Ordinary income dividends paid to stockholders who are non-resident
aliens or foreign entities will be subject to a 30% United States withholding
tax under existing provisions of the Code applicable to foreign individuals
and entities unless a reduced rate of withholding or a withholding exemption
is provided under applicable treaty law. Non-resident stockholders are urged
to consult their own tax advisers concerning the applicability of the United
States withholding tax.

     Under certain provisions of the Code, some stockholders may be subject to
a withholding tax on ordinary income dividends and capital gain dividends
("backup withholding"). Generally, stockholders subject to backup withholding
will be those for whom no certified taxpayer identification number is on file
with the Fund or who, to the Fund's knowledge, have furnished an incorrect
number. When establishing an account, an investor must certify under penalty
of perjury that such number is correct and that such investor is not otherwise
subject to backup withholding.

     Dividends and interest received by the Fund may give rise to withholding
and other taxes imposed by foreign countries. Tax conventions between certain
countries and the United States may reduce or eliminate such taxes.

     The foregoing is a general and abbreviated summary of the applicable
provisions of the Code and Treasury regulations presently in effect. For the
complete provisions, reference should be made to the pertinent Code sections
and the Treasury regulations promulgated thereunder. The Code and the Treasury
regulations are subject to change by legislative, judicial or administrative
action either prospectively or retroactively.

     Ordinary income and capital gain dividends may also be subject to state
and local taxes.

     Certain states exempt from state income taxation dividends paid by RICs
which are derived from interest on United States Government obligations. State
law varies as to whether dividend income attributable to United States
Government obligations is exempt from state income tax.

     Stockholders are urged to consult their own tax advisers regarding
specific questions as to Federal, foreign, state or local taxes. Foreign
investors should consider applicable foreign taxes in their evaluation of an
investment in the Fund.


                   BROKERAGE ALLOCATION AND OTHER PRACTICES

     Royce is responsible for selecting the brokers who effect the purchases
and sales of the Fund's portfolio securities. No broker is selected to effect
a securities transaction for the Fund unless such broker is believed by Royce
to be capable of obtaining the best price for the security involved in the
transaction. Best price and execution is comprised of several factors,
including the liquidity of the security, the commission charged, the
promptness and reliability of execution, priority accorded the order and other
factors affecting the overall benefit obtained. In



                                     B-16
<PAGE>

addition to considering a broker's execution capability, Royce generally
considers the brokerage and research services which the broker has provided to
it, including any research relating to the security involved in the
transaction and/or to other securities. Such services may include general
economic research, market and statistical information, industry and technical
research, strategy and company research and performance measurement, and may
be written or oral. Brokers that provide both research and execution services
are generally paid higher commissions than those paid to brokers who do not
provide such research and execution services. Royce determines the overall
reasonableness of brokerage commissions paid, after considering the amount
another broker might have charged for effecting the transaction and the value
placed by Royce upon the brokerage and/or research services provided by such
broker, viewed in terms of either that particular transaction or Royce's
overall responsibilities with respect to its accounts.

     Royce is authorized, under Section 28(e) of the Securities Exchange Act
of 1934 and under its Investment Advisory Agreement with the Fund, to pay a
broker a commission in excess of that which another broker might have charged
for effecting the same transaction, in recognition of the value of brokerage
and research services provided by the broker.

     Brokerage and research services furnished by brokers through whom the
Fund effects securities transactions may be used by Royce in servicing all of
its accounts, and not all of such services may be used by Royce in connection
with the Fund.

     Even though investment decisions for the Fund are made independently from
those for the other accounts managed by Royce, securities of the same issuer
are frequently purchased, held or sold by more than one Royce account because
the same security may be suitable for all of them. When the same security is
being purchased or sold for more than one Royce account on the same trading
day, Royce may seek to average the transactions as to price and allocate them
as to amount in a manner believed to be equitable to each. Such purchases and
sales of the same security are generally effected pursuant to Royce's Trade
Allocation Guidelines and Procedures. Under such Guidelines and Procedures,
unallocated orders are placed with and executed by broker-dealers during the
trading day. The securities purchased or sold in such transactions are then
allocated to one or more of Royce's accounts at or shortly following the close
of trading, using the average net price obtained. Such allocations are done
based on a number of judgmental factors that Royce believes should result in
fair and equitable treatment to those of its accounts for which the securities
may be deemed suitable. In some cases, this procedure may adversely affect the
price paid or received by the Fund or the size of the position obtained for
the Fund.

     The Fund may effect brokerage transactions on a securities exchange with
Legg Mason Wood Walker, Incorporated ("Legg Mason Wood Walker") and any other
affiliated broker-dealers in accordance with the procedures and requirements
set forth in Rule 17e-1 under the 1940 Act. Any such transactions would
involve the use of the affiliated broker-dealer for execution purposes only
and/or for locating the purchasers or sellers involved in the transaction. The
affiliated broker-dealer would not be compensated because of any other
research-related service or product provided or to be provided by it and may
not be used to effect brokerage transactions in Nasdaq or other
over-the-counter securities. Although the Fund will not effect any principal
transactions with any affiliated broker-dealers, they may purchase securities
that are offered in certain underwritings in which an affiliated broker-dealer
is a participant in accordance with the procedures and requirements set forth
in Rule 10f-3 under the 1940 Act. Charles M. Royce and/or trusts primarily for
the benefit of members of his family may own or acquire substantial amounts of
Legg Mason common stock.

     During the year ended December 31, 2002, the Fund did not acquire any
securities of any of its regular brokers (as defined in Rule 10b-1 under the
1940 Act) or of any of their parents.

     During each of the three years ended December 31, 2002, 2001 and 2000,
the Fund paid brokerage commissions of approximately $______, $______ and
$______, respectively. Since October 1, 2001, when Royce became an indirect
wholly-owned subsidiary of Legg Mason, the Fund paid no brokerage commissions
to Legg Mason Wood Walker or to any other affiliates of Legg Mason.



                                      B-17
<PAGE>

                                NET ASSET VALUE

     The NAV of the Fund's shares of Common Stock is calculated at the close
of regular trading on the New York Stock Exchange ("NYSE") (generally 4:00
p.m. Eastern time) every day that the NYSE is open. The Fund makes this
information available daily by telephone (800-221-4268) and via its web site
(www.roycefunds.com) and through electronic distribution for media
publication, including major internet-based financial services web sites and
portals (bloomberg.com, yahoo.com, cbsmarketwatch.com, etc.) Currently, The
Wall Street Journal, The New York Times and Barron's publish NAVs for
closed-end investment companies weekly.

     The net asset value per share of the Fund's Common Stock is calculated by
dividing the current value of the Fund's total assets less the sum of all of
its liabilities and the aggregate liquidation preferences of its outstanding
shares of Preferred Stock, by the total number of outstanding shares of Common
Stock. The Fund's investments are valued based on market value or, if market
quotations are not readily available, at their fair value as determined in
good faith under procedures established by the Fund's Board of Directors.

     For the years ended December 31, 2002, 2001 and 2000, the Fund's
portfolio turnover rates were ___%, 30% and 36%, respectively.


                             FINANCIAL STATEMENTS

     The audited financial statements included in the Annual Report to the
Fund's Stockholders for the fiscal year ended December 31, 2001, together with
the report of Tait, Weller & Baker thereon, and the unaudited financial
statements included in the Semi-Annual Report to the Fund's Stockholders for
the six months ended June 30, 2002 are incorporated herein by reference. It is
expected that the audited financial statements included in the Annual Report
to the Fund's Stockholders for the fiscal year ended December 31, 2002,
together with the report of Tait, Weller & Baker thereon, will be mailed to
stockholders and available on the Fund's website (www.roycefunds.com) on or
around February 28, 2003.



                                     B-18
<PAGE>
                                    Part C

                               Other Information

Item 24. Financial Statements and Exhibits

1.      a.      The following audited financial statements of Royce Value Trust,
                Inc. (the "Fund") are included in the Fund's Annual Report to
                Stockholders for the fiscal year ended December 31, 2001, filed
                with the Securities and Exchange Commission ("SEC") under
                Section 30(b)(1) of the Investment Company Act of 1940, as
                amended ("1940 Act"), and are incorporated in Part B hereof by
                reference:

                Schedule of Investments, December 31, 2001;
                Statement of Assets and Liabilities, December 31, 2001;
                Statement of Operations for the fiscal year ended December 31,
                2001;
                Statement of Changes in Net Assets for the years ended December
                31, 2001 and 2000;
                Notes to Financial Statements at December 31, 2001;
                Financial Highlights for the five fiscal years ended December
                31, 2001; and
                Report of Independent Accountants.

        b.      The following unaudited financial statements of the Fund are
                included in the Fund's Semi-Annual Report to Stockholders for
                the six months ended June 30, 2002, filed with the SEC under
                Section 30(b)(1) of the 1940 Act, and are incorporated in Part
                B hereof by reference:

                Schedule of Investments, June 30, 2002;
                Statement of Assets and Liabilities, June 30, 2002;
                Statement of Operations for the six months ended June 30, 2002;
                Statement of Changes in Net Assets for the six months ended
                June 30, 2002; and for the year ended December 31, 2001.
                Notes to Financial Statements at June 30, 2002; and
                Financial Highlights for the five fiscal years ended December
                31, 2001 and for the six months ended June 30, 2002.

2.      Exhibits

        (a)(1)      Articles of Incorporation dated July 1, 1986.
           (2)      Articles of Amendment dated May 6, 1988.
           (3)      Articles of Amendment dated April 28, 1989.
           (4)      Articles of Amendment dated March 2, 1998.
           (5)      Articles of Amendment dated March 19, 1998.
           (6)      Certificate of Correction dated May 6, 1998.
           (7)      Form of Articles Supplementary creating the 7.80% Cumulative
                    Preferred Stock ("7.80% Preferred Stock"). (1)
           (8)      Form of Articles Supplementary creating the 7.30%
                    Tax-Advantaged Cumulative Preferred Stock ("7.30% Preferred
                    Stock"). 2)
           (9)      Form of Articles Supplementary dated January ___, 2003.
        (b)         Amended and Restated By-laws.

<PAGE>

        (d)(1)      Form of specimen share certificate for Common Stock.
           (2)      Form of share certificate for 7.80% Preferred Stock. (3)
           (3)      Form of share certificate for 7.3% Preferred Stock. (2)
        (e)         Amended and Restated Distribution Reinvestment and Cash
                    Purchase Plan.(4)
        (g)         Investment Advisory Agreement dated October 1, 2001 between
                    the Fund and Royce & Associates, Inc. ("R & A"). (5)
        (j)(1)      Custodian Contract with State Street Bank and Trust Company
                    ("State Street") dated October 20, 1986.
           (2)      Amendment to Custodian Contract dated December 11, 1987.
           (3)      Amendment to Custodian Contract dated May 13, 1988.
           (4)      Amendment to Custodian Contract dated April 2, 1992.
           (5)      Amendment to Custodian Contract dated November 3, 1997.
           (6)      Amendment to Custodian Contract dated September 14, 2000.
           (7)      Form of Amendment to Custodian Contract dated January ___,
                    2003.
        (k)(1)      Registrar, Transfer Agency and Service Agreement with State
                    Street (Common Stock) dated October 20, 1986.
           (2)      Registrar, Transfer Agency and Service Agreement with State
                    Street (7.80% Preferred Stock) dated August 21, 1996.
           (3)      First Amendment to Registrar, Transfer Agency and Paying
                    Agency Agreement (7.80% Preferred Stock and 7.3% Preferred
                    Stock) dated May 18, 1998.(6)
           (4)      Form of Subscription Certificate.
           (5)      Form of Subscription Agent Agreement.
           (6)      Form of Information Agent Agreement.
        (n)(1)      Consent of Tait, Weller & Baker, independent auditors for
                    the Fund.
           (2)      Consent of Ernst & Young LLP, independent auditors.
        (r)         Code of Ethics.

_________
(1)     Incorporated by reference to Pre-Effective Amendment No. 1 to the
        Fund's Registration Statement on Form N-2, filed with the SEC on
        August 9, 1996 (File No. 333-8039).
(2)     Incorporated by reference to the Fund's Registration Statement on Form
        N-2, filed with the SEC on April 29, 1998 (File No. 333-51295).
(3)     Incorporated by reference to the Fund's Registration Statement on Form
        N-2, filed with the SEC on July 12, 1996 (File No. 333-8039).
(4)     Incorporated by reference to the Fund's Registration Statement on Form
        N-2, filed with the SEC on August 11, 1995 (File No. 811-4875).
(5)     Incorporated by reference to the Fund's Form NSAR-B, filed with the SEC
        on February 28, 2002.



                                      2
<PAGE>

(6)     Incorporated by reference to Pre-Effective Amendment No. 1 to the
        Fund's Registration Statement on Form N-2, filed with the SEC on May
        14, 1998 (File No. 333-51295).

Item 25. Marketing Arrangements

         Not applicable.

Item 26. Other Expenses of Issuance and Distribution

     The following table sets forth the estimated expenses to be incurred in
connection with the offering described in this Registration Statement:

<TABLE>
<CAPTION>
  <S>                                                               <C>
                                                                      Estimated
  Category                                                             Expenses
  -------------------------------------------------------            ----------
  Registration fees........................................               7,756
  New York Stock Exchange listing fees.....................              52,569
  Printing expenses........................................              30,000
  Subscription Agent fees and expenses ....................              15,000
  Information Agent fees and expenses......................              12,000
  Accounting fees and and expenses.........................               4,200
  Legal fees and expenses..................................             100,000
  Miscellaneous............................................               3,475
                                                                     ----------

  Total....................................................             225,000
                                                                     ==========
</TABLE>

Item 27. Person Controlled by or Under Common Control with Fund

         None.

Item 28. Number of Holders of Securities

         The following information is given as of January __, 2003:

                                                                   Number of
                     Title of Class                             Record Holders
- ----------------------------------------------------------    ----------------
Common Stock, $0.001 par value............................           *
7.80% Cumulative Preferred Stock, $.001 par value.........           *
7.30% Tax-Advantaged Cumulative Preferred Stock, $.001 par value...  *

_________
*     To be provided by amendment.

Item 29. Indemnification

     Reference is made to Section 2-418 of the Maryland General Corporation
Law, Article VI and VII of the Fund's Articles of Incorporation, as amended,
Article V of the Fund's Amended and Restated By-laws and the Investment
Advisory Agreement, each of which provide for indemnification.



                                      3
<PAGE>

     The Investment Advisory Agreement between the Fund and R & A obligates
the Fund to indemnify R & A and hold it harmless from and against all damages,
liabilities, costs and expenses (including reasonable attorneys' fees)
incurred by R & A in or by reason of any action, suit, investigation or other
proceeding arising out of or otherwise based upon any action actually or
allegedly taken or omitted to be taken by R & A in connection with the
performance of any of its duties or obligations under the Agreement or
otherwise as an investment adviser of the Fund. R & A is not entitled to
indemnification in respect of any liability to the Fund or its security
holders to which it would otherwise be subject by reason of its willful
misfeasance, bad faith or gross negligence.

     Insofar as indemnification for liability arising under the Securities Act
of 1933, as amended (the "1933 Act"), may be permitted to directors, officers
and controlling persons of the Fund pursuant to the foregoing provisions or
otherwise, the Fund has been advised that, in the opinion of the SEC, such
indemnification is against public policy as expressed in the 1933 Act and is,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Fund of expenses
incurred or paid by a director, officer or controlling person of the Fund in
the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities
being registered, the Fund will, unless in the opinion of its counsel the
matter has been settled by controlling precedent or such claim is to be paid
under insurance policies, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.

     The Fund, its officers and directors, R & A and certain others are
presently insured under a Directors and Officers/Errors and Omissions
Liability Insurance Policy issued by ICI Mutual Insurance Company, which
generally covers claims by the Fund's stockholders and third persons based on
or alleging negligent acts, misstatements or omissions by the insureds and the
costs and expenses of defending those claims, up to a limit of $15,000,000,
with a deductible amount of $250,000.

Item 30. Business and other Connections of Investment Adviser

     Reference is made to Schedules D and F to Royce's amended Form ADV (File
No. 801-8268), which are incorporated herein by reference.

Item 31. Location of Accounts and Records

     Records are located at:

     1.      Royce Value Trust, Inc.
             10th Floor
             1414 Avenue of the Americas
             New York, New York 10019

(Corporate records and records relating to the function of Royce as investment
adviser)

     2.      State Street Bank and Trust Company
             Two Heritage Drive
             North Quincy, Massachusetts 02171



                                      4
<PAGE>

          Attention: Royce Value Trust, Inc.

(Records relating to its functions as Custodian for the Fund)

     3.      Equiserve Trust Company, N.A.
             225 Franklin Street
             Boston, Massachusetts 02110
             Attention: Royce Value Trust, Inc.

(Records relating to its functions as Registrar and Transfer Agent and
Dividend Paying Agent for the Fund)

Item 32. Management Services

     Not applicable.

Item 33. UNDERTAKINGS

(1) The Fund undertakes to suspend the offering of its shares until it amends
its prospectus if (a) subsequent to the effective date of its Registration
Statement, the net asset value of its shares declines more than 10% from its
net asset value as of the effective date of the Registration Statement or (b)
the net asset value increases to an amount greater than its net proceeds as
stated in the prospectus.

(2) Not applicable.

(3) The Fund hereby undertakes to supplement the prospectus, after the
expiration of the subscription period, to set forth the results of the
subscription offer, and the terms of any subsequent reoffering thereof.

(4) Not applicable.

(5) Not applicable.

(6) The Fund undertakes to send by first class mail or other means designed to
ensure equally prompt delivery, within two business days of receipt of a
written or oral request, any Statement of Additional Information. SIGNATURES



                                      5
<PAGE>

                                  SIGNATURES

     Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Fund has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York and State of New York on the 3rd day of
January, 2003.

                              ROYCE VALUE TRUST, INC.
                              (Fund)

                              By:  /s/Charles M. Royce
                                   ---------------------------
                                   Charles M. Royce, President

     Each person whose signature appears below hereby authorizes Charles M.
Royce, John D. Diederich or John E. Denneen, or either of them, as
attorney-in-fact, to sign on his behalf, individually and in each capacity
stated below, any amendments to this Registration Statement (including
post-effective amendments) and to file the same, with all exhibits thereto,
with the Securities and Exchange Commission.

     Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>
<S>                     <C>                            <C>
Signature               Title                          Date
- ---------               -----                          ----

/s/ Charles M. Royce    President and Director         January 3, 2003
- ----------------------  (Principal Executive Officer)
Charles M. Royce

/s/ John D. Diederich   Treasurer                      January 3, 2003
- ---------------------   (Principal Financial and
John D. Diederich       Accounting Officer)


/s/ Donald R. Dwight    Director                       January 3, 2003
- ---------------------
Donald R. Dwight

/s/ Mark R. Fetting     Director                       January 3, 2003
- ---------------------
Mark R. Fetting

/s/ Richard M. Galkin   Director                       January 3, 2003
- ---------------------
Richard M. Galkin

/s/ Stephen L. Isaacs   Director                       January 3, 2003
- ---------------------
Stephen L. Isaacs

/s/ William L. Koke     Director                       January 3, 2003
- ---------------------
William L. Koke

/s/ David L. Meister    Director                       January 3, 2003
- ---------------------
David L. Meister

/s/ G. Peter O'Brien    Director                       January 3, 2003
- ---------------------
G. Peter O'Brien
</TABLE>



                                      6
<PAGE>

                                 Exhibit Index

Exhibit Number    Document
- --------------    --------

        (a)(1)      Articles of Incorporation dated July 1, 1986.
           (2)      Articles of Amendment dated May 6, 1988.
           (3)      Articles of Amendment dated April 28, 1989.
           (4)      Articles of Amendment dated March 2, 1998.
           (5)      Articles of Amendment dated March 19, 1998.
           (6)      Certificate of Correction dated May 6, 1998.
           (7)      Form of Articles Supplementary creating the 7.80% Cumulative
                    Preferred Stock ("7.80% Preferred Stock"). (1)
           (8)      Form of Articles Supplementary creating the 7.30%
                    Tax-Advantaged Cumulative Preferred Stock ("7.30% Preferred
                    Stock"). 2)
           (9)      Form of Articles Supplementary dated January ___, 2003.
        (b)         Amended and Restated By-laws.
        (d)(1)      Form of specimen share certificate for Common Stock.
           (2)      Form of share certificate for 7.80% Preferred Stock. (3)
           (3)      Form of share certificate for 7.3% Preferred Stock. (2)
        (e)         Amended and Restated Distribution Reinvestment and Cash
                    Purchase Plan.(4)
        (g)         Investment Advisory Agreement dated October 1, 2001 between
                    the Fund and Royce & Associates, Inc. ("R & A"). (5)
        (j)(1)      Custodian Contract with State Street Bank and Trust Company
                    ("State Street") dated October 20, 1986.
           (2)      Amendment to Custodian Contract dated December 11, 1987.
           (3)      Amendment to Custodian Contract dated May 13, 1988.
           (4)      Amendment to Custodian Contract dated April 2, 1992.
           (5)      Amendment to Custodian Contract dated November 3, 1997.
           (6)      Amendment to Custodian Contract dated September 14, 2000.
           (7)      Form of Amendment to Custodian Contract dated January ___,
                    2003.
        (k)(1)      Registrar, Transfer Agency and Service Agreement with State
                    Street (Common Stock) dated October 20, 1986.
           (2)      Registrar, Transfer Agency and Service Agreement with State
                    Street (7.80% Preferred Stock) dated August 21, 1996.
           (3)      First Amendment to Registrar, Transfer Agency and Paying
                    Agency Agreement (7.80% Preferred Stock and 7.3% Preferred
                    Stock) dated May 18, 1998.(6)
           (4)      Form of Subscription Certificate.
           (5)      Form of Subscription Agent Agreement.
           (6)      Form of Information Agent Agreement.
        (n)(1)      Consent of Tait, Weller & Baker, independent auditors for
                    the Fund.
           (2)      Consent of Ernst & Young LLP, independent auditors.
        (r)         Code of Ethics.

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.A1
<SEQUENCE>3
<FILENAME>efc2-1398_exhibita1.txt
<TEXT>
                                                                Exhibit (a)(1)



                            ARTICLES OF INCORPORATION
                                       OF
                             ROYCE VALUE TRUST, INC.

                                   ARTICLE I

           THE UNDERSIGNED, Howard J. Kashner, whose post office address is 1271
Avenue of the Americas,  New York, New York 10020, being at least eighteen years
of age, does hereby act as an incorporator  and form a corporation  under and by
virtue of the Maryland General Corporation Law.

                                   ARTICLE II

                                      NAME

             The name of the Corporation is Royce Value Trust, Inc.

                                  ARTICLE III

                               PURPOSES AND POWERS

              The Corporation is formed for the following purposes:

           (1) To conduct and carry on the business of an investment company.

           (2) To hold, invest and reinvest its assets in securities and other
investments or to hold part or all of its assets in cash.

          (3) To issue and sell shares of its capital stock in such amounts and
on such terms and conditions and for such purposes and for such amount or kind
of consideration as may now or hereafter be permitted by law.

          (4) To do any and all additional acts and to exercise any and all
additional powers or rights as may be necessary, incidental, appropriate or
desirable for the accomplishment of all or any of the foregoing purposes.

          The Corporation shall be authorized to exercise and enjoy all of the
powers, rights and privileges granted to, or conferred upon, corporations by the
Maryland General Corporation Law now or hereafter in force, and the enumeration
of the foregoing shall not be deemed to exclude any powers, rights or privileges
so granted or conferred.

                                   ARTICLE IV

                       PRINCIPAL OFFICE AND RESIDENT AGENT

          The post office address of the principal office of the Corporation in
the State of Maryland is 300 East Lombard Street, Baltimore, Maryland 21202. The
name of the resident



<PAGE>


agent of the Corporation in the State of Maryland is United States Corporation
Company, a corporation incorporated in the State of Maryland. The post office
address of the resident agent is 300 East Lombard Street, Baltimore, Maryland
21202.

                                   ARTICLE V

                                  CAPITAL STOCK

          (1) The total number of shares of capital stock that the Corporation
shall have authority to issue is one hundred fifty million (150,000,000) shares,
of the par value of one-tenth of one cent ($.001) per share and of the aggregate
par value of one hundred fifty thousand dollars ($150,000), all of which one
hundred fifty million (150,000,000) shares are designated Common Stock.

          (2) The Corporation may issue fractional shares. Any fractional shares
shall carry proportionately the rights of a whole share, including, without
limitation, the right to vote and the right to receive dividends.

          (3) All persons who shall acquire stock in the Corporation shall
acquire the same subject to the provisions of these Articles of Incorporation
and the By-Laws of the Corporation.

          (4) No holder of stock of the Corporation shall have, by virtue of
being such a holder, any right to purchase or subscribe for any shares of the
Corporation's capital stock or any other security that the Corporation may issue
or sell (whether out of the number of shares authorized by these Articles of
Incorporation or out of any shares of the Corporation's capital stock that the
Corporation may acquire) other than a right that the Board of Directors may, in
its discretion, determine to grant.

          (5) The Board of Directors shall have authority by resolution to
classify or reclassify any authorized by unissued shares of capital stock from
time to time by setting or changing in any one or more respects the preferences,
conversion or other rights, voting powers, restrictions, limitations as to
dividends, qualifications or terms or conditions of redemption of the capital
stock.

          (6) Notwithstanding any provision of the Maryland General Corporation
Law requiring any action to be taken or authorized by the affirmative vote of
the holders of a designated proportion of the votes of all classes or of any
class of stock of the Corporation, such action shall be effective and valid if
taken or authorized by the affirmative vote of a majority of the total number of
votes entitled to be cast thereon.

                                   ARTICLE VI

                               BOARD OF DIRECTORS

          (1) The number of directors constituting the Board of Directors shall
be no less than three (3); provided, however, that in accordance with the
Maryland General Corporation Law, the number of directors may be less than three
(3) (i) if no shares of the


                                       2
<PAGE>


Corporations stock are outstanding, there shall be at least one (1) director,
and (ii) if shares of the Corporation's stock are outstanding and there are
less than three (3) stockholders, the number of directors may be less than
three (3) but not less than the number of stockholders. This number may be
changed pursuant to the By-laws of the Corporation, but shall at no time be
less than the minimum number required under the Maryland General Corporation
Law. The names of the directors who shall act until the first annual meeting
of stockholders or until their successors are duly chosen and qualified are:

               Charles M. Royce
               Thomas R. Ebright
               Richard M. Galkin
               Stephen L. Isaacs
               David L. Meister

          (2) In furtherance, and not in limitation, of the powers conferred by
the laws of the State of Maryland, the Board of Directors is expressly
authorized to do the following to the extent consistent with the Maryland
General Corporation Law:

               (i) To make, alter or repeal the By-Laws of the Corporation,
except where such power is reserved by the By-Laws to the stockholders and
except as otherwise required by the Investment Company Act of 1940.

               (ii) To determine from time to time whether and to what extent
and at what times and places and under what conditions and regulations the books
and accounts of the Corporation, or any of them other than the stock ledger,
shall be open to the inspection of the stockholders. No stockholder shall have
any right to inspect any account or book or document of Corporation, except as
conferred by law or authorized by resolution of the Board of Directors or of the
stockholders.

               (iii) Without the assent or vote of the stockholders, to
authorize the issuance from time to time of shares of stock of any class of the
Corporation, whether now or hereafter authorized, and securities convertible
into shares of stock of the Corporation of any class or classes, whether now or
hereafter authorized, for such consideration as the Board of Directors may deem
advisable.

               (iv) Without the assent or vote of the stockholders, to authorize
and issue obligations of the Corporation, secured and unsecured, as the Board of
Directors may determine, and to authorize and cause to be executed mortgages and
liens upon the real or personal property of the Corporation.

               (v) Notwithstanding anything in these Articles of Incorporation
to the contrary, to establish, in its absolute discretion, the basis or method
for determining the value of the assets belonging to any class, the value of the
liabilities belonging to any class and the net asset value of each share of any
class of the Corporation's stock.

               (vi) To determine, in accordance with generally accepted
accounting principles and practices, what constitutes net profits, earnings,
surplus or net assets in excess of capital, and to determine what accounting
periods shall be used by the Corporation for any


                                       3
<PAGE>


purpose; to set apart out of any funds of the Corporation reserves for such
purposes as it shall determine and to abolish the same; to declare and pay any
dividends and distributions in cash, securities or other property from surplus
or any funds legally available therefor, at such intervals as it shall
determine; to declare dividends or distributions by means of a formula or
other method of determination, at meetings held less frequently than the
frequency of the effectiveness of such declarations; to establish payment
dates for dividends or any other distributions of any basis, including dates
occurring less frequently than the effectiveness of declarations thereof; and
to provide for the payment of declared dividends on a date earlier or later
than the specified payment date in the case of stockholders of the Corporation
surrendering their entire ownership of shares of any class of stock of the
Corporation for redemption.

               (vii) In addition to the powers and authorities granted herein
and by statute expressly conferred upon it, the Board of Directors is authorized
to exercise all powers and do all acts that may be exercised or done by the
Corporation pursuant to the provisions of the laws of the State of Maryland,
these Articles of Incorporation and the By-Laws of the Corporation.

          (3) Any determination made in good faith, in a manner reasonably
believed to be in the best interests of the Corporation, and with the care that
an ordinarily prudent person in a like position would use under similar
circumstances, by or pursuant to the direction of the Board of Directors, with
respect to the amount of assets, obligations or liabilities of the Corporation,
as to the amount of net income of the Corporation from dividends and interest
for any period or amounts at any time legally available for the payment of
dividends, as to the amount of any reserves or charges set up and the propriety
thereof, as to the time of or purpose for creating reserves or as to the use,
alteration or cancellation of any reserves or charges (whether or not any
obligation or liability for which the reserves or charges have been created has
been paid or discharged or is then or thereafter required to be paid or
discharged), as to the value of any security owned by the Corporation, the
determination of the net asset value of shares of any class of the Corporation's
capital stock, or as to any other matters relating to the issuance, sale,
repurchase, redemption or other acquisition or disposition of securities or
shares of capital stock of the Corporation, and any reasonable determination
made in good faith by the Board of Directors whether any transaction constitutes
a purchase of securities on "margin", a sale of securities "short", or an
underwriting or sale of, or a participation in any underwriting or selling group
in connection with the public distribution of, any securities, shall be final
and conclusive, and shall be binding upon the Corporation and all holders of its
capital stock, past, present and future, and shares of the capital stock of the
Corporation are issued and sold on the condition and understanding, evidenced by
the purchase of shares if capital stock or acceptance of share certificates,
that any and all such determinations shall be binding as aforesaid. No provision
of these Articles of Incorporation shall be effective to (i) require a waiver or
compliance with any provision of the Securities Act of 1933, as amended, or the
Investment Company Act of 1940, or of any valid rule, regulation or order of the
Securities and Exchange Commission under those Acts or (ii) protect or purport
to protect any director or officer of the Corporation against any liability to
the Corporation or its security holders to which he would otherwise be subject
by reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of his office.


                                       4
<PAGE>


                                  ARTICLE VII

                                   AMENDMENTS

          The Corporation reserves the right from time to time to make any
amendment to its Articles of Incorporation, now or hereafter authorized by law,
including any amendment that alters the contract rights, as expressly set forth
in its Articles of Incorporation, of any outstanding stock.

          IN WITNESS WHEREOF, I have adopted and signed these Articles of
Incorporation and do hereby acknowledge that the adoption and signing are my
acts, and that to the best of my knowledge, information and belief all matters
and facts stated herein are true in all material respects, said statement being
made under the penalties of perjury.


Dated the 1st day of July, 1986

                                                      /s/ Howard J. Kashner
                                                      -------------------------
                                                          Howard J. Kashner,
                                                          Incorporator




                                       5

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.A2
<SEQUENCE>4
<FILENAME>efc2-1398_exhibita2.txt
<TEXT>
                                                                Exhibit (a)(2)


                            ROYCE VALUE TRUST, INC.

                             ARTICLES OF AMENDMENT

           ROYCE VALUE TRUST, INC., a Maryland corporation having its
principal office in Baltimore City, Maryland (hereinafter called the
"Corporation"), hereby certificates to the State Department of Assessments and
Taxation of Maryland, that:

           FIRST: The charter of the Corporation is hereby amended by striking
out Paragraph (1) of Article V of the Articles of Incorporation and inserting
in lieu thereof the following:

           "(1) The total number of shares of capital stock that the
           Corporation shall have authority to issue is two hundred million
           (200,000,000) shares, of which fifty million (50,000,000) shares
           shall be shares of Preferred Stock of the par value of one-tenth of
           one cent ($.001) per share and of the aggregate par value of fifty
           thousand dollars ($50,000) and one hundred fifty million
           (150,000,000) shares shall be shares of Common Stock of the par
           value of one-tenth of one cent ($.001) per share and of the
           aggregate par value of one hundred fifty thousand dollars
           ($150,000)."

           SECOND: The Board of Directors of the Corporation on February 24,
1988, duly adopted a resolution in which was set forth the foregoing amendment
to the charter, declaring that such amendment of the charter as proposed was
advisable and directing that it be submitted for action thereon by the
stockholders of the Corporation at the Annual Meeting of Stockholders to be
held on April 28, 1988.

           THIRD: Notice setting forth such amendment of the charter and
stating that a purpose of the meeting of the stockholders would be to take
action thereon, was given, as required by law, to all stockholders entitled to
vote thereon. The amendment of the charter of the


<PAGE>


Corporation as hereinabove set forth was approved by the stockholders of the
Corporation at such meeting by the affirmative vote of at least a majority of
all the votes entitled to be cast thereon, as permitted by the charter of the
Corporation.

           FOURTH: The amendment of the charter of the Corporation as
hereinabove set forth has been duly advised by the Board of Directors and
approved by the stockholders of the Corporation.

           FIFTH: (a) The total number of shares of stock which the
Corporation was heretofore authorized to issue is one hundred fifty million
(150,000,000) shares, all of one class, of the par value of one tenth of one
cent ($.001) each and of the aggregate pay value of one hundred fifty thousand
dollars ($150,000).

                (b) The total number of shares of all classes of stock is
increased by this amendment to fifty million (50,000,000) shares of Preferred
Stock of the par value of one tenth of one cent ($.001) each and of the
aggregate par value of fifty thousand dollars ($50,000) and one hundred fifty
million (150,000,000) shares of Common Stock of the par value of one-tenth of
one cent ($.001) each and of the aggregate par value of one hundred fifty
thousand dollars ($150,000). The aggregate par value of all the shares of all
classes of stock is two hundred thousand dollars ($200,000).

                (c) The information required by subsection (b) (2) (i) of
Section 2-607 was not changed by the amendment.


                                       2
<PAGE>



           IN WITNESS WHEREOF, ROYCE VALUE TRUST, INC. has caused these
presents to be signed in its name and on its behalf by its President and
witnessed by its Secretary on May 6, 1988.


                                  ROYCE VALUE TRUST, INC.


                                  By  /s/ Charles M. Royce
                                    -------------------------------
                                    Charles M. Royce, President


Witness:

/s/ Eileen P. Burke
- --------------------------
Eileen P. Burke, Secretary

           THE UNDERSIGNED, President of Royce Value Trust, Inc., who executed
on behalf of such corporation the foregoing Articles of Amendment, of which
this certificate is made a part, hereby acknowledges, in the name and on
behalf of such corporation, the foregoing Articles of Amendment to be the
corporate act of such corporation and further certificates that, to the best
of his knowledge, information and belief, the matters and facts set forth
therein with respect to the approval thereof are true in all material
respects, under the penalties of perjury.

                                  /s/ Charles M. Royce
                                  -------------------------------
                                  Charles M. Royce, President



                                       3

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.A3
<SEQUENCE>5
<FILENAME>efc2-1398_exhibita3.txt
<TEXT>
                                                                Exhibit (a)(3)


                            ROYCE VALUE TRUST, INC.

                             ARTICLES OF AMENDMENT

           ROYCE VALUE TRUST, INC., a Maryland corporation having its
principal office in Baltimore City, Maryland (hereinafter called the
"Corporation"), hereby certificates to the State Department of Assessments and
Taxation of Maryland, that:

           FIRST: The Corporation's original Articles of Incorporation were
filed on July 1, 1986 and an amendment thereto was filed on June 3, 1988.

           SECOND: The Articles of Incorporation of the corporation are hereby
amended by adding a new paragraph (4) of Articles VI thereof, limiting certain
liabilities of directors and officers of the Corporation, which paragraph (4)
shall read in the entirety as follows:

           "(4) To the fullest extent extent that limitations on the liability
           of directors and officers and permitted by the Maryland General
           Corporation Law (as from time to time amended), no director or
           officer of the Corporation shall have any liability to the
           Corporation shall have any liability to the Corporation or its
           stockholders for money damages. This limitation on liability
           applies to events occurring at the time a person serves as a
           director or officer of the Corporation, whether or not such person
           is a director or officer at the time of any proceeding in which
           liability is asserted. No future amendment to the Articles of
           Incorporation of the Corporation shall affect any right of any
           person under this paragraph (4) based on any event, omission or
           proceeding prior to such amendment."

           THIRD: The Board of Directors of the Corporation on March 14, 1989,
duly adopted a resolution in which was set forth the foregoing amendment to
the Articles of Incorporation, declaring that such amendment of the Articles
of Incorporation as proposed was


<PAGE>


advisable and directing that it be submitted for action thereon to the
stockholders of the Corporation at the Annual Meeting of Stockholders to be
held on April 28, 1989.

           FOURTH: Notice setting forth such amendment of the Articles of
Incorporation and stating that a purpose of the meeting of the stockholders
would be to take action thereon, was given, as required by law, to all
stockholders entitled to vote thereon. The amendment of the Articles of
Incorporation of the Corporation as hereinabove set forth was approved by the
stockholders of the Corporation at such meeting by the stockholders of the
affirmative vote of at least a majority of all the votes entitled to be cast
thereon, as permitted by the Articles of Incorporation of the Corporation.

           FIFTH: The amendment of the Articles of Incorporation of the
Corporation as hereinabove set forth has been duly advised by the Board of
Directors and approved by the stockholders of the Corporation


                                       2
<PAGE>


           IN WITNESS WHEREOF, ROYCE VALUE TRUST, INC. has caused these
presents to be signed in its name and on its behalf by its President and
witnessed by its Secretary on April 28, 1989.

                                  ROYCE VALUE TRUST, INC.


                                  By  /s/ Charles M. Royce
                                    ----------------------------
                                    Charles M. Royce, President


Witness:

/s/ Leonard F. Wallace
- -------------------------------
Leonard F. Wallace, Secretary

           THE UNDERSIGNED, President of Royce Value Trust, Inc., who executed
on behalf of such corporation the foregoing Articles of Amendment, of which
this certificate is made a part, hereby acknowledges, in the name and on
behalf of such corporation, the foregoing Articles of Amendment to be the
corporate act of such corporation and further certifies that, to the best of
his knowledge, information and belief, the matters and facts set forth therein
with respect to the approval thereof are true in all material respects, under
the penalties of perjury.

                                  /s/ Charles M. Royce
                                  ----------------------------
                                  Charles M. Royce, President








</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.A4
<SEQUENCE>6
<FILENAME>efc2-1398_exhibita4.txt
<TEXT>
                                                                Exhibit (a)(4)



                            ROYCE VALUE TRUST, INC.

                             ARTICLES OF AMENDMENT

      Royce Value Trust, Inc., a Maryland corporation (the "Corporation"),
hereby certifies to the Maryland State Department of Assessments and Taxation
that the Articles Supplementary to the Corporation's Articles of Incorporation
relating to the Corporation's 8% Cumulative Preferred Stock (the "Cumulative
Preferred Stock") (the "Articles Supplementary") are hereby amended in the
manner set forth below.

      FIRST:  Article FIRST of the Articles Supplementary is hereby
amended by deleting it in its entirety and inserting the following in lieu
thereof:

           FIRST:  Pursuant to authority expressly vested in the Board of
           Directors of the Corporation by Articles FIFTH of the Charter of
           the Corporation, the Board of Directors has authorized the issuance
           of a series of 10,000,000 shares of preferred stock, par value
           $.001 per share, of the Corporation designated as the 7.80%
           Cumulative Preferred Stock (the "Cumulative Preferred Stock") and
           has provided for the issuance of shares of such series.

      SECOND: Article 1 of the Articles Supplementary is hereby further
amended by deleting the definition of "Cumulative Preferred Stock" in its
entirety and inserting the following in lieu thereof:

           "Cumulative Preferred Stock" means the 7.80%, Cumulative Preferred
           Stock, par value $.001 per share, of the Corporation.

      THIRD: Article II of the Articles Supplementary is hereby further
amended by deleting paragraph 1 thereof and inserting the following in lieu
thereof:

      1. Dividends.
         ---------

           (a)  Holders of shares of the Cumulative Preferred Stock shall be
                entitled to receive, when, as and if declared by the Board of
                Directors, out of funds legally available therefor, cumulative
                cash dividends at the annual rate of 7.80% per share (computed
                on the basis of a 360-day year consisting of twelve 30-day
                months) of the initial Liquidation Preference of $25.00 per
                share on the Cumulative Preferred Stock and no more, payable
                quarterly on March 23, June 23, September 23 and December 23
                in each year (each a "Dividend Payment Date"), commencing
                March 23, 1998 (or, if any such day is not a Business Day,
                then on the next succeeding Business Day) to holders of record
                of the Cumulative Preferred Stock as they appear on the stock
                register of the Corporation at the close of business on the
                preceding March 6, June 6, September 6 and December 6 (or, if
                any such day is not a Business Day, then on the next
                succeeding Business Day), as the case by be, in preference to
                dividends on shares of Common Stock and any other capital
                stock of the Corporation ranking junior to the


<PAGE>


                Cumulative Preferred Stock in payment of dividends.
                Dividends on shares of the Cumulative Preferred Stock shall
                accumulate from the date on which the first such shares of
                the Cumulative Preferred Stock are originally issued ("Date
                of Original Issue"). Each period beginning on and including
                a Dividend Payment Date (or the Date of Original Issue, in
                the case of the first dividend period after issuance of such
                shares) and ending on but excluding the next succeeding
                Dividend Payment date is referred to herein as a "Dividend
                Period." Dividends on account of arrears for any past
                Dividend Period may be declared and paid at any time,
                without reference to any Dividend Payment Date, to holders
                of record on such date, not exceeding 30 days preceding the
                payment date thereof, as shall be fixed by the Board of
                Directors.

      FOURTH: Article 11 of the Articles Supplementary is hereby further
amended by deleting Paragraph 3(b) thereof in its entirety and inserting the
following in lieu thereof:

      3.   Redemption

           (b) Optional Redemptions.
               --------------------

                Prior to August 15, 2003, the Corporation may, at its option,
                redeem shares of the Cumulative Preferred Stock at the
                Redemption Price per share only if and to the extent that any
                such redemption is necessary, in the judgment of the
                Corporation, to maintain the Corporation's status as a
                regulated investment company under Subchapter M of the Code.
                Commencing August 15, 2003 and at any time and from time to
                time thereafter, the Corporation may, at its option, to the
                extent permitted by the 1940 Act, Maryland law, the Indenture
                and any other agreements in respect of indebtedness of the
                Corporation to which it may be a party or by which it may be
                bound, redeem the Cumulative Preferred Stock in whole or in
                part at the Redemption Price per share.

      FIFTH: Article 11 is hereby further amended by deleting Paragraph 8(b)
thereof in its entirety and inserting the following in lieu thereof:

      8.   Limitation on Incurrence of Additional Indebtedness and Issuance of
           -------------------------------------------------------------------
           Additional Preferred Stock.
           --------------------------

           (b)  So long as any shares of the Cumulative Preferred Stock are
                outstanding, the Corporation may issue and sell additional
                shares of the Cumulative Preferred Stock authorized hereby
                and/or shares of one or more other series of Preferred Stock
                constituting a series of a class of senior securities of the
                Corporation representing stock under Section 18 of the 1940
                Act in addition to the shares of the Cumulative Preferred
                Stock, provided that (i) if the Corporation is using the
                proceeds (net of all offering expenses payable by the
                Corporation) of such additional Preferred Stock to purchase
                all or a portion of the shares of the Cumulative Preferred
                Stock or to


                                       2
<PAGE>


                redeem or otherwise refinance all or a portion of the shares
                of the Cumulative Preferred Stock, any other Preferred Stock
                and/or any indebtedness of the Corporation then outstanding,
                then the Corporation shall, immediately after giving effect
                to the issuance of such additional Preferred Stock and to
                its receipt and application of the proceeds thereof, have an
                "asset coverage" for all senior securities which are stock,
                as defined in Section 18(h) of the 1940 Act, or at least
                250% of the shares of the Cumulative Preferred Stock and all
                other Preferred Stock of the Corporation then outstanding,
                or (ii) if the Corporation is using the proceeds (net of all
                offering expenses payable by the Corporation) of such
                additional Preferred Stock for any other purpose, then the
                Corporation shall, immediately after giving effect to the
                issuance of such additional Preferred Stock and to its
                receipt and application of the proceeds thereof, have an
                "asset coverage" for all senior securities which are stock
                as defined in Section 18(h) of the 1940 Act of at least 300%
                of the shares of the Cumulative Preferred Stock and all
                other Preferred Stock of the Corporation then outstanding,
                and, in the case of either (i) or (ii) above, (iii) no such
                additional Preferred Stock shall have any preference or
                priority over any other Preferred Stock of the Corporation
                upon the distribution of the assets of the Corporation or in
                respect of the payment of dividends.

      SIXTH: The foregoing amendment to the Articles Supplementary was advised
by the Board of Directors and approved by the stockholders of the Corporation.

      IN WITNESS WHEREOF, Royce Value Trust, Inc. has caused these presents to
be signed in its name and on its behalf by a duly authorized officer and
witnessed by its Secretary or Assistant Secretary as of this 2nd day of March,
1998.

      The undersigned acknowledges these Articles of Amendment to be the
corporate act of the Corporation and states that, to the best of his
knowledge, information and belief, the matters and facts set forth herein with
respect to authorization and approval hereof are true in all material respects
and that this statement is made under the penalties of perjury.


                                  ROYCE VALUE TRUST, INC.



                                  /s/  John D. Diederich
                                  -----------------------------
                                  Name:  John D. Diederich
                                  Title: Vice President

Witness:

/s/ John E. Denneen
- --------------------------
Name:  John E. Denneen
Title: Secretary



                                       3

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.A5
<SEQUENCE>7
<FILENAME>efc2-1398_exhibita5.txt
<TEXT>
                                                                Exhibit (a)(5)


                            ROYCE VALUE TRUST, INC.

                             ARTICLES OF AMENDMENT

     Royce Value Trust, Inc., a Maryland corporation (the "Corporation"),
hereby certifies to the Maryland State Department of Assessments and Taxation
that the Articles Supplementary to the Corporation's Articles of Incorporation
relating to the Corporation's 8% Cumulative Preferred Stock (the "Cumulative
Preferred Stock") (the "Articles Supplementary") are hereby amended in the
manner set forth below.

     FIRST: Article II is hereby further amended by deleting Paragraph 4(c)
thereof in its entirety and inserting the following in lieu thereof:

     4. Voting Rights.

        (c) Right to Vote with Respect to Certain Other Matters

             (1)  So long as any shares of the Cumulative Preferred Stock are
                  outstanding, the Corporation shall not, without the
                  affirmative vote of the holders of two-thirds of the shares
                  of the Cumulative Preferred Stock outstanding at the time,
                  voting separately as one class, amend, alter or repeal the
                  provisions of the Charter, whether by merger, consolidation
                  or otherwise, so as to materially adversely affect any of
                  the contract rights expressly set forth in the Charter of
                  holders of shares of the Cumulative Preferred Stock. The
                  Corporation shall notify Moody's ten Business Days prior to
                  any such vote described above. Unless a higher percentage is
                  provided for under the Charter, the affirmative vote of the
                  holders of a majority of the outstanding shares of Preferred
                  Stock, including the Cumulative Preferred Stock, voting
                  together as a single class, will be required to approve any
                  plan of reorganization adversely affecting such shares or
                  any action requiring a vote of security holders under
                  Section 13(a) of the 1940 Act. For purposes of the preceding
                  sentence, the phrase "vote of the holders of a majority of
                  the outstanding shares of Preferred Stock" shall have the
                  meaning set forth in the 1940 Act. The class vote of holders
                  of shares of Preferred Stock, including the Cumulative
                  Preferred Stock, described above, will be in addition to a
                  separate vote of the requisite percentage of shares of
                  Common Stock and shares of Preferred Stock, voting together
                  as a single class, necessary to authorize the action in
                  question. An increase in the number of authorized shares of
                  Preferred Stock pursuant to the Charter or the issuance of
                  additional shares of any series of Preferred Stock
                  (including the Cumulative Preferred Stock) pursuant to the
                  Charter shall not in and of itself be considered to
                  adversely affect the contract rights of the holders of the
                  Cumulative Preferred Stock.

<PAGE>

             (2)  Notwithstanding the foregoing, and except as otherwise
                  required by the 1940 Act, (i) the holders of outstanding
                  shares of the Cumulative Preferred Stock shall be entitled
                  as a class, to the exclusion of the holders of all other
                  securities, . including other Preferred Stock, Common Stock
                  and other classes of capital stock of the Corporation, to
                  vote on matters affecting the Cumulative Preferred Stock
                  that do not materially adversely affect any of the contract
                  rights of holders of such other securities, including other
                  Preferred Stock, Common Stock and other classes of capital
                  stock of the Corporation, as expressly set forth in the
                  Charter, and (ii) the holders of outstanding shares of the
                  Cumulative Preferred Stock shall not be entitled to vote on
                  matters affecting any other Preferred Stock that do not
                  materially adversely the contract rights of the holders of
                  the Cumulative Preferred Stock, as expressly set forth in
                  the Charter.

     SECOND:  The Articles Supplementary are hereby further amended by adding
new Article III as follows:

                                  ARTICLE III

                       ABILITY OF BOARD OF DIRECTORS TO
                       MODIFY THE ARTICLES SUPPLEMENTARY

                  To the extent permitted by law, the Board of Directors,
                  without the vote of the holders of the Cumulative Preferred
                  Stock or any other capital stock of the Corporation, may
                  amend the provisions of these Articles Supplementary to
                  resolve any inconsistency or ambiguity or to remedy any
                  formal defect so long as the amendment does not materially
                  adversely affect any of the contract rights of holders of
                  the Cumulative Preferred Stock or any other capital stock of
                  the Corporation, as expressly set forth in the Charter, or,
                  if the Corporation has not previously terminated compliance
                  with the provisions hereof with respect to Moody's pursuant
                  to paragraph 7 of Article II hereof, adversely affect the
                  then current rating on the Cumulative Preferred Stock by
                  Moody's.

     THIRD: The foregoing amendment to the Articles Supplementary was advised
by the Board of Directors and approved by the stockholders of the Corporation.

     IN WITNESS WHEREOF, Royce Value Trust, Inc. has caused these presents to
be signed in its name and on its behalf by a duly authorized officer and
witnessed by its Secretary or Assistant Secretary as of this 19th day of
March, 1998.



                                      2

<PAGE>

     The undersigned acknowledges these Articles of Amendment to be the
corporate act of the Corporation and states that, to the best of his
knowledge, information and belief, the matters and facts set forth herein with
respect to authorization and approval hereof are true in all material respects
and that this statement is made under the penalties of perjury.


                                          ROYCE VALUE TRUST, INC.



                                          /s/  John D. Diederich
                                          ------------------------------------
                                          Name:  John D. Diederich
                                          Title:    Vice President

Witness:

/s/ John E. Denneen
- ----------------------------
Name:   John E. Denneen
Title:  Secretary



                                      3

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.A6
<SEQUENCE>8
<FILENAME>efc2-1398_exhibita6.txt
<TEXT>
                                                                Exhibit (a)(6)


                            ROYCE VALUE TRUST, INC.


                           CERTIFICATE OF CORRECTION

     Royce Value Trust. Inc., a Maryland corporation (the "Corporation"),
hereby certifies that:

     FIRST:  The title of the document being corrected is "Articles of
             Amendment".

     SECOND: The only party to the document being corrected is Royce Value
             Trust, Inc.

     THIRD:  The Articles of Amendment were filed on March 23, 1998.

     FOURTH: The execution of the document was defective in that the signatory
             was incorrectly designated as President rather than as Vice
             President.

     IN WITNESS WHEREOF, Royce Value Trust, Inc. has caused these presents to
be signed in its name and on its behalf, as of May 11, 1998, by its duly
authorized officers who acknowledge that this Certificate of Correction is the
act of the Corporation, that to the best of their knowledge, information and
belief, all matters and facts set forth, herein that are required to be
executed under oath are true in all material respects, and that this statement
is made under the penalties of perjury.


WITNESS:                                       ROYCE VALUE TRUST, INC.


/s/ John E. Denneen                            /s/  John D. Diederich
- ---------------------------------------        -------------------------------
Name:   John E. Denneen                        Name:   John D. Diederich
Title:  Secretary                              Title:  Vice President

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.A9
<SEQUENCE>9
<FILENAME>efc2-1398_exhibita9.txt
<TEXT>
                                                                Exhibit (a)(9)



                            ROYCE VALUE TRUST, INC.

                            ARTICLES SUPPLEMENTARY


      Royce Value Trust, Inc., a Maryland corporation (the "Corporation"),
hereby certifies to the State Department of Assessments and Taxation of
Maryland (the "SDAT"), that:

      FIRST: Under a power contained in Title 3, Subtitle 8 of the Maryland
General Corporation Law (the "MGCL"), the Corporation, by resolutions of its
Board of Directors (the "Board of Directors") duly adopted at a meeting duly
called and held, elected to become subject to Section 3-803 and Section
3-804(c)(3) of the MGCL.

      SECOND: The resolutions referred to above provide that, notwithstanding
any provision in the charter or Bylaws of the Corporation to the contrary, the
Corporation elects to be subject to (1) Section 3-803 of the MGCL, except with
respect to directors elected separately by holders of preferred stock of the
Corporation, the repeal of which may be effected only by the means authorized
by Section 3-802(b)(3) of the MGCL, and (2) Section 3-804(c)(3) of the MGCL,
the repeal of which may be effected only by the means authorized by Section
3-802(b)(3) of the MGCL.

      THIRD: The election to become subject to Section 3-803 and Section
3-804(c)(3) of the MGCL has been approved by the Board of Directors in the
manner and by the vote required by law.

      FOURTH: The undersigned President of the Corporation acknowledges these
Articles Supplementary to be the corporate act of the Corporation and, as to
all matters or facts required to be verified under oath, the undersigned
President acknowledges that, to the best of his knowledge, information and
belief, these matters and facts are true in all material respects and that
this statement is made under the penalties for perjury.





                 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE>

      IN WITNESS WHEREOF, the Corporation has caused these Articles
Supplementary to be executed under seal in its name and on its behalf by its
President and attested by its Secretary on this ____ day of January, 2002.

ATTEST:                                     ROYCE VALUE TRUST, INC.


- -----------------------------------         -----------------------------(SEAL)
John E. Denneen                             Charles M. Royce
Secretary                                   President



                                       2

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.B
<SEQUENCE>10
<FILENAME>efc2-1398_exhibitb.txt
<TEXT>
                                                                   Exhibit (b)



                             AMENDED AND RESTATED

                                    BYLAWS

                                      OF

                            ROYCE VALUE TRUST, INC.

                            A Maryland Corporation


                                   ARTICLE I

                           MEETINGS OF STOCKHOLDERS

          SECTION 1. Place. All meetings of stockholders of Royce Value Trust,
Inc. (the "Corporation") shall be held in the United States at the principal
executive office of the Corporation or at such other place as shall be set by
the Board of Directors and stated in the notice of the meeting.

          SECTION 2. Annual Meeting. An annual meeting of the stockholders for
the election of directors and the transaction of any business within the
powers of the Corporation shall be held on a date and at the time set by the
Board of Directors during the thirty-one (31) day period ending on September
30 of each calendar year.

          SECTION 3. Special Meetings.

          (a) General. The President or the Board of Directors may call a
special meeting of the stockholders. Subject to Section 3(b) of this Article
I, a special meeting of stockholders shall also be called by the Secretary of
the Corporation upon the written request of the stockholders entitled to cast
not less than a majority of all the votes entitled to be cast at such meeting.

          (b) Stockholder Requested Special Meetings. (1) Any stockholder of
record seeking to have stockholders request a special meeting shall, by
sending written notice to the Secretary (the "Record Date Request Notice") by
registered mail, return receipt requested, request the Board of Directors to
fix a record date to determine the stockholders entitled to request a special
meeting (the "Request Record Date"). The Record Date Request Notice shall set
forth the purpose of the meeting and the matters proposed to be acted on at
it, shall be signed by one or more stockholders of record as of the date of
signature (or their agents duly authorized in writing), shall bear the date of
signature of each such stockholder (or such agent) and shall set forth all
information relating to each such stockholder that must be disclosed in
solicitations of proxies for election of directors in an election contest
(even if an election contest is not involved), or is otherwise required, in
each case pursuant to Regulation 14A (or any successor provision) under the
Securities
<PAGE>

Exchange Act of 1934, as amended (the "Exchange Act"). Upon receiving the
Record Date Request Notice, the Board of Directors may fix a Request Record
Date. The Request Record Date shall not precede and shall not be more than ten
(10) days after the close of business on the date on which the resolution
fixing the Request Record Date is adopted by the Board of Directors. If the
Board of Directors, within ten (10) days after the date on which a valid
Record Date Request Notice is received, fails to adopt a resolution fixing the
Request Record Date and make a public announcement of such Request Record
Date, the Request Record Date shall be the close of business on the tenth
(10th) day after the first date on which the Record Date Request Notice is
received by the Secretary.

                  (2) In order for any stockholder to request a special meeting,
one or more written requests for a special meeting signed by stockholders of
record (or their agents duly authorized in writing) as of the Request Record
Date entitled to cast not less than a majority (the "Special Meeting
Percentage") of all of the votes entitled to be cast at such meeting (the
"Special Meeting Request") shall be delivered to the Secretary. In addition,
the Special Meeting Request shall set forth the purpose of the meeting and the
matters proposed to be acted on at it (which shall be limited to the matters
set forth in the Record Date Request Notice received by the Secretary), shall
bear the date of signature of each such stockholder (or such agent) signing
the Special Meeting Request, shall set forth the name and address, as they
appear in the Corporation's books, of each stockholder signing such request
(or on whose behalf the Special Meeting Request is signed), the class, series
and number of all shares of stock of the Corporation which are owned by each
such stockholder, and the nominee holder for, and number of, shares owned
beneficially but not of record, shall be sent to the Secretary by registered
mail, return receipt requested, and shall be received by the Secretary within
sixty (60) days after the Request Record Date. Any requesting stockholder may
revoke his, her or its request for a special meeting at any time by written
revocation delivered to the Secretary.

                  (3) The Secretary shall inform the requesting stockholders of
the reasonably estimated cost of preparing and mailing the notice of meeting
(including the Corporation's proxy materials). The Secretary shall not be
required to call a special meeting upon stockholder request and such meeting
shall not be held unless, in addition to the documents required by subsection
(2) of this Section 3(b), the Secretary receives payment of such reasonably
estimated cost prior to the mailing of any notice of the meeting.

                  (4) Except as provided in the next sentence, any special
meeting shall be held at such place, date and time as may be designated by the
President or the Board of Directors, whoever has called the meeting. In the
case of any special meeting called by the Secretary upon the request of
stockholders (a "Stockholder Requested Meeting"), such meeting shall be held
at such place, date and time as may be designated by the Board of Directors;
provided, however, that the date of any Stockholder Requested Meeting shall be
not more than ninety (90) days after the record date for such meeting (the
"Meeting Record Date"); and provided further that if the Board of Directors
fails to designate, within ten (10) days after the date that a valid Special
Meeting Request is actually received by the Secretary (the "Delivery Date"), a
date and time for a Stockholder Requested Meeting, then such meeting shall be
held at 2:00 p.m. local time on the ninetieth (90th)

                                      2
<PAGE>

day after the Meeting Record Date or, if such ninetieth (90th) day is not a
Business Day (as defined below), on the first preceding Business Day; and
provided further that in the event that the Board of Directors fails to
designate a place for a Stockholder Requested Meeting within ten (10) days
after the Delivery Date, then such meeting shall be held at the principal
executive office of the Corporation. In fixing a date for any special meeting,
the President or the Board of Directors may consider such factors as he, she
or it deems relevant within the good faith exercise of business judgment,
including, without limitation, the nature of the matters to be considered, the
facts and circumstances surrounding any request for meeting and any plan of
the Board of Directors to call an annual meeting or a special meeting. In the
case of any Stockholder Requested Meeting, if the Board of Directors fails to
fix a Meeting Record Date that is a date within thirty (30) days after the
Delivery Date, then the close of business on the thirtieth (30th) day after
the Delivery Date shall be the Meeting Record Date.

                  (5) If at any time as a result of written revocations of
requests for the special meeting, stockholders of record (or their agents duly
authorized in writing) as of the Request Record Date entitled to cast less
than the Special Meeting Percentage shall have delivered and not revoked
requests for a special meeting, the Secretary may refrain from mailing the
notice of the meeting or, if the notice of the meeting has been mailed, the
Secretary may revoke the notice of the meeting at any time before ten (10)
days before the commencement of the meeting if the Secretary has first sent to
all other requesting stockholders written notice of any revocation of a
request for the special meeting and written notice of the Secretary's
intention to revoke the notice of the meeting. Any request for a special
meeting received after a revocation by the Secretary of a notice of a meeting
shall be considered a request for a new special meeting.

                  (6) The Board of Directors or the President may appoint
independent inspectors of elections to act as the agent of the Corporation for
the purpose of promptly performing a ministerial review of the validity of any
purported Special Meeting Request received by the Secretary. For the purpose of
permitting the inspectors to perform such review, no such purported request
shall be deemed to have been delivered to the Secretary until the earlier of
(i) five (5) Business Days after receipt by the Secretary of such purported
request and (ii) such date as the independent inspectors certify to the
Corporation that the valid requests received by the Secretary represent at
least a majority of the issued and outstanding shares of stock that would be
entitled to vote at such meeting. Nothing contained in this subsection (6)
shall in any way be construed to suggest or imply that the Corporation or any
stockholder shall not be entitled to contest the validity of any request,
whether during or after such five (5) Business Day period, or to take any
other action (including, without limitation, the commencement, prosecution or
defense of any litigation with respect thereto, and the seeking of injunctive
relief in such litigation).

                  (7) For purposes of these Bylaws, "Business Day" shall mean
any day other than a Saturday, a Sunday or a day on which banking institutions
in the State of New York are authorized or obligated by law or executive order
to close.

          SECTION 4. Notice of Meetings. Written or printed notice of the
purpose or purposes, in the case of a special meeting, and of the time and
place of every meeting of the


                                      3
<PAGE>

stockholders shall be given by the Secretary of the Corporation to
each stockholder of record entitled to vote at the meeting, by either placing
the notice in the mail, delivering it by overnight delivery service or
transmitting the notice by electronic mail or any other electronic means at
least ten (10) days, but not more than ninety (90) days, prior to the date
designated for the meeting, addressed to each stockholder at such
stockholder's address appearing on the books of the Corporation or supplied by
the stockholder to the Corporation for the purpose of notice. The notice of
any meeting of stockholders may be accompanied by a form of proxy approved by
the Board of Directors in favor of the actions or individuals as the Board of
Directors may select. Notice of any meeting of stockholders shall be deemed
waived by any stockholder who attends the meeting in person or by proxy or who
before or after the meeting submits a signed waiver of notice that is filed
with the records of the meeting.

          Any business of the Corporation may be transacted at an annual
meeting of stockholders without being specifically designated in the notice,
except such business as is required by any statute to be stated in such
notice. No business shall be transacted at a special meeting of stockholders
except as specifically designated in the notice.

          SECTION 5. Quorum. The presence in person or by proxy of
stockholders of the Corporation entitled to cast at least a majority of the
votes entitled to be cast shall constitute a quorum at each meeting of the
stockholders, and all questions shall be decided by a majority of the votes
cast on the question (except with respect to the election of directors, which
shall be by plurality of the votes cast), unless otherwise required by the
Maryland General Corporation Law (the "MGCL"), the Investment Company Act of
1940, as amended (the "Investment Company Act"), or the Corporation's charter
(the "Charter"). In the absence of a quorum, the stockholders present in
person or by proxy at the meeting, by majority vote and without notice other
than by announcement at the meeting, may adjourn the meeting from time to time
as provided in Section 6 of this Article I until a quorum shall attend. The
stockholders present at any duly organized meeting may continue to do business
until adjournment, notwithstanding the withdrawal of enough stockholders to
leave less than a quorum. The lack of presence at any meeting in person or by
proxy of holders of the number of shares of stock of the Corporation of the
proportion that may be required by the MGCL, the Investment Company Act, or
other applicable statute, the Charter or these Bylaws, for action upon any
given matter shall not prevent action at the meeting on any other matter or
matters that may properly come before the meeting, so long as there are
present, in person or by proxy, holders of the number of shares of stock of
the Corporation required for action upon the other matter or matters.

          SECTION 6. Adjournment. Any meeting of the stockholders may be
adjourned from time to time, without notice other than by announcement at the
meeting at which the adjournment is taken. At any adjourned meeting at which a
quorum shall be present, any action may be taken that could have been taken at
the meeting originally called. A meeting of the stockholders may not be
adjourned to a date more than one hundred twenty (120) days after the original
record date, unless a new record date is set by the Board of Directors and
further notice is provided to the stockholders.



                                      4
<PAGE>

          SECTION 7. Organization and Conduct. Every meeting of stockholders
shall be conducted by an individual appointed by the Board of Directors to be
chairman of the meeting or, in the absence of such appointment, by the
Chairman of the Board, if any, or, in the case of a vacancy in the office or
absence of the Chairman of the Board, by one of the following officers present
at the meeting: the Vice Chairman of the Board, if any, the President, any
Vice President, the Secretary, the Treasurer or, in the absence of such
officers, a chairman chosen by the stockholders by the vote of a majority of
the votes cast by stockholders present in person or by proxy. The Secretary
or, in the Secretary's absence, an Assistant Secretary or, in the absence of
both the Secretary and Assistant Secretaries, an individual appointed by the
Board of Directors or, in the absence of such appointment, an individual
appointed by the chairman of the meeting shall act as secretary. In the event
that the Secretary presides at a meeting of the stockholders, an Assistant
Secretary, or, in the absence of Assistant Secretaries, an individual
appointed by the Board of Directors or the chairman of the meeting, shall
record the minutes of the meeting. The order of business and all other matters
of procedure at any meeting of stockholders shall be determined by the
chairman of the meeting. The chairman of the meeting may prescribe such rules,
regulations and procedures and take such action as, in the discretion of such
chairman, are appropriate for the proper conduct of the meeting, including,
without limitation, (a) restricting admission to the time set for the
commencement of the meeting; (b) limiting attendance at the meeting to
stockholders of record of the Corporation, their duly authorized proxies or
other such individuals as the chairman of the meeting may determine; (c)
limiting participation at the meeting on any matter to stockholders of record
of the Corporation entitled to vote on such matter, their duly authorized
proxies or other such individuals as the chairman of the meeting may
determine; (d) limiting the time allotted to questions or comments by
participants; (e) maintaining order and security at the meeting; (f) removing
any stockholder or any other individual who refuses to comply with meeting
procedures, rules or guidelines as set forth by the chairman of the meeting;
and (g) recessing or adjourning the meeting to a later date and time and place
announced at the meeting. Unless otherwise determined by the chairman of the
meeting, meetings of stockholders shall not be required to be held in
accordance with the rules of parliamentary procedure.

          SECTION 8. Voting. Except as otherwise provided by statute or the
Charter, each holder of record of shares of stock of the Corporation having
voting power shall be entitled at each meeting of the stockholders to one (1)
vote for every full share of stock, and proportional voting rights for
fractional shares of stock, standing in his name on the records of the
Corporation as of the record date determined pursuant to Section 9 of this
Article I.

          Each stockholder entitled to vote at any meeting of stockholders may
authorize another person or persons to act for him by a proxy signed by the
stockholder or his attorney-in-fact or a proxy in such other form as may be
permitted by the Maryland General Corporation Law, including electronic
transmission from the stockholder or his authorized agent. A stockholder may
authorize another person or persons to act as proxy by telephone or by
transmitting, or authorizing the transmission of, a telegram, cablegram,
datagram or other means of electronic transmission to the person or persons
authorized to act as proxy or to a proxy solicitation firm, proxy support
service organization or other person authorized by the person or persons who
will act as proxy to receive the transmission. No proxy shall be valid after
the expiration of eleven (11) months from

                                      5
<PAGE>

the date thereof, unless otherwise provided in the proxy. Every proxy shall be
revocable at the pleasure of the stockholder executing it, except in those
cases in which the proxy states that it is irrevocable and in which an
irrevocable proxy is permitted by law.

          SECTION 9. Fixing of Record Date for Determining Stockholders
Entitled to Notice and to Vote at Meeting. The Board of Directors may set a
record date for the purpose of determining stockholders entitled to notice of,
and to vote at, any meeting of the stockholders. The record date for a
particular meeting shall be not more than ninety (90) nor fewer than ten (10)
days before the date of the meeting. All persons who were holders of record of
shares as of the record date of a meeting, and no others, shall be entitled to
vote at such meeting and any adjournment thereof.

          SECTION 10. Inspectors. The Board of Directors may, in advance of
any meeting of stockholders, appoint one (1) or more inspectors to act at the
meeting or at any adjournment of the meeting. If the inspectors shall not be
so appointed or if any of them shall fail to appear or act, the chairman of
the meeting may appoint inspectors. Each inspector, before entering upon the
discharge of his duties, shall, if required by the chairman of the meeting,
take and sign an oath to execute faithfully the duties of inspector of the
meeting with strict impartiality and according to the best of his ability. The
inspectors shall determine the number of shares outstanding and the voting
power of each share, the number of shares represented at the meeting, the
existence of a quorum and the validity and effect of proxies, and shall
receive votes, ballots or consents, hear and determine all challenges and
questions arising in connection with the right to vote, count and tabulate all
votes, ballots or consents, determine the result and do those acts as are
proper to conduct the election or vote with fairness to all stockholders. On
request of the chairman of the meeting or any stockholder entitled to vote at
the meeting, the inspectors shall make a report in writing of any challenge,
request or matter determined by them and shall execute a certificate of any
fact found by them. No director or candidate for the office of director shall
act as inspector of an election of directors. Inspectors need not be
stockholders of the Corporation.

          SECTION 11. Consent of Stockholders in Lieu of Meeting. Except as
otherwise provided by statute or the Charter, any action required to be taken
at any annual or special meeting of stockholders, or any action that may be
taken at any annual or special meeting of the stockholders, may be taken
without a meeting, without prior notice and without a vote, if the following
are filed with the records of stockholders' meetings: (a) a unanimous written
consent that sets forth the action and is signed by each stockholder entitled
to vote on the matter and (b) a written waiver of any right to dissent signed
by each stockholder entitled to notice of the meeting but not entitled to vote
at the meeting.



                                      6
<PAGE>

          SECTION 12. Advance Notice of Stockholder Nominees for Director and
Other Stockholder Proposals.

          (a) Annual Meetings of Stockholders. (1) Nominations of individuals
for election to the Board of Directors and the proposal of other business to
be considered by the stockholders may be made at an annual meeting of
stockholders (i) pursuant to the Corporation's notice of meeting, (ii) by or
at the direction of the Board of Directors or (iii) by any stockholder of the
Corporation who was a stockholder of record both at the time of giving of
notice provided for in this Section 12(a) and at the time of the annual
meeting, who is entitled to vote at the meeting and who has complied with this
Section 12(a).

                  (2) For nominations or other business to be properly brought
before an annual meeting by a stockholder pursuant to clause (iii) of subsection
(1) of this Section 12(a), the stockholder must have given timely notice thereof
in writing to the Secretary of the Corporation and such other business must
otherwise be a proper matter for action by the stockholders. To be timely, a
stockholder's notice shall set forth all information required under this
Section 12 and shall be delivered to the Secretary at the principal executive
office of the Corporation not less than ninety (90) days nor more than one
hundred twenty (120) days prior to the first anniversary of the date of
mailing of the notice for the preceding year's annual meeting; provided,
however, that in the event that the date of the mailing of the notice for the
annual meeting is advanced or delayed by more than thirty (30) days from the
first anniversary of the date of mailing of the notice for the preceding
year's annual meeting, notice by the stockholder to be timely must be so
delivered not earlier than the one hundred twentieth (120th) day prior to the
date of mailing of the notice for such annual meeting and not later than the
close of business on the later of the ninetieth (90th) day prior to the date
of mailing of the notice for such annual meeting or the tenth (10th) day
following the day on which public announcement of the date of mailing of the
notice for such meeting is first made. In no event shall the public
announcement of a postponement or adjournment of an annual meeting commence a
new time period for the giving of a stockholder's notice as described above.
Such stockholder's notice shall set forth (i) as to each individual whom the
stockholder proposes to nominate for election or reelection as a director, (A)
the name, age, business address and residence address of such individual, (B)
the class, series and number of any shares of stock of the Corporation that
are beneficially owned by such individual, (C) whether such stockholder
believes any such individual is, or is not, an "interested person" of the
Corporation (as defined in the Investment Company Act) and information
regarding such individual that is sufficient, in the discretion of the Board
of Directors or any committee thereof or any authorized officer of the
Corporation, to make such determination and (D) all other information relating
to such individual that is required to be disclosed in solicitations of
proxies for election of directors in an election contest (even if an election
contest is not involved), or is otherwise required, in each case pursuant to
Regulation 14A (or any successor provision) under the Exchange Act and the
rules thereunder (including such individual's written consent to being named
in the proxy statement as a nominee and to serving as a director if elected);
(ii) as to any other business that the stockholder proposes to bring before
the meeting, a description of the business desired to be brought before the
meeting, the reasons for proposing such business at the meeting and any
material interest in such business

                                      7
<PAGE>

of such stockholder and any Stockholder Associated Person (as defined below),
individually or in the aggregate, including any anticipated benefit to the
stockholder and any Stockholder Associated Person therefrom; (iii) as to the
stockholder giving the notice and any Stockholder Associated Person, the
class, series and number of all shares of stock of the Corporation which are
owned by such stockholder and by such Stockholder Associated Person, if any,
and the nominee holder for, and number of, shares owned beneficially but not
of record by such stockholder and by any such Stockholder Associated Person
and (iv) as to the stockholder giving the notice and any Stockholder
Associated Person covered by clauses (ii) or (iii) of subsection (2) of this
Section 12(a), the name and address of such stockholder, as they appear on the
Corporation's stock ledger and current name and address, if different, and of
such Stockholder Associated Person.

                  (3) Notwithstanding anything in this Section 12(a) to the
contrary, in the event the Board of Directors increases or decreases the maximum
or minimum number of directors in accordance with Article II, Section 2, and
there is no public announcement of such action at least one hundred (100) days
prior to the first anniversary of the date of mailing of the notice for the
preceding year's annual meeting, a stockholder's notice required by this
Section 12(a) shall also be considered timely, but only with respect to
nominees for any new positions created by such increase, if it shall be
delivered to the Secretary at the principal executive office of the
Corporation not later than the close of business on the tenth (10th) day
following the day on which such public announcement is first made by the
Corporation.

                  (4) For purposes of this Section 12, "Stockholder Associated
Person" of any stockholder shall mean (i) any person controlling, directly or
indirectly, or acting in concert with, such stockholder, (ii) any beneficial
owner of shares of stock of the Corporation owned of record or beneficially by
such stockholder and (iii) any person controlling, controlled by or under
common control with such Stockholder Associated Person.

          (b) Special Meetings of Stockholders. Only such business shall be
conducted at a special meeting of stockholders as shall have been brought
before the meeting pursuant to the Corporation's notice of meeting.
Nominations of individuals for election to the Board of Directors may be made
at a special meeting of stockholders at which directors are to be elected (i)
pursuant to the Corporation's notice of meeting, (ii) by or at the direction
of the Board of Directors or (iii) provided that the Board of Directors has
determined that directors shall be elected at such special meeting, by any
stockholder of the Corporation who is a stockholder of record both at the time
of giving of notice provided for in this Section 12 and at the time of the
special meeting, who is entitled to vote at the meeting and who complied with
the notice procedures set forth in this Section 12. In the event the
Corporation calls a special meeting of stockholders for the purpose of
electing one or more individuals to the Board of Directors, any such
stockholder may nominate an individual or individuals (as the case may be) for
election as a director as specified in the Corporation's notice of meeting, if
the stockholder's notice required by subsection (2) of Section 12(a) of this
Article I shall be delivered to the Secretary at the principal executive
office of the Corporation not earlier than the one hundred twentieth (120th)
day prior to such special meeting and not later than the close of business on
the later of the

                                      8
<PAGE>

ninetieth (90th) day prior to such special meeting or the tenth (10th) day
following the day on which public announcement is first made of the date of
the special meeting and of the nominees proposed by the Board of Directors to
be elected at such meeting. In no event shall the public announcement of a
postponement or adjournment of a special meeting commence a new time period
for the giving of a stockholder's notice as described above.

          (c) General. (1) Upon written request by the Secretary or the Board
of Directors or any committee thereof, any stockholder proposing a nominee for
election as a director or any proposal for other business at a meeting of
stockholders shall provide, within five (5) Business Days of delivery of such
request (or such other period as may be specified in such request), written
verification, satisfactory, in the discretion of the Board of Directors or any
committee thereof or any authorized officer of the Corporation, to demonstrate
the accuracy of any information submitted by the stockholder pursuant to this
Section 12. If a stockholder fails to provide such written verification within
such period, the information as to which written verification was requested
may be deemed not to have been provided in accordance with this Section 12.

                  (2) Only such individuals who are nominated in accordance with
this Section 12 shall be eligible for election as directors, and only such
business shall be conducted at a meeting of stockholders as shall have been
brought before the meeting in accordance with this Section 12. The chairman of
the meeting shall have the power to determine whether a nomination or any other
business proposed to be brought before the meeting was made or proposed, as
the case may be, in accordance with this Section 12.

                  (3) For purposes of this Section 12, (a) the "date of mailing
of the notice" shall mean the date of the proxy statement for the solicitation
of proxies for election of directors and (b) "public announcement" shall mean
disclosure (i) in a press release reported by the Dow Jones News Service,
Associated Press or comparable news service or (ii) in a document publicly
filed by the Corporation with the Securities and Exchange Commission pursuant
to the Exchange Act or the Investment Company Act.

                  (4) Notwithstanding the foregoing provisions of this Section
12, a stockholder shall also comply with all applicable requirements of state
law, the Exchange Act and the Investment Company Act and the rules and
regulations thereunder with respect to the matters set forth in this Section 12.
Nothing in this Section 12 shall be deemed to affect any right of a stockholder
to request inclusion of a proposal in, nor the right of the Corporation to omit
a proposal from, the Corporation's proxy statement pursuant to Rule 14a-8 (or
any successor provision) under the Exchange Act.


                                  ARTICLE II

                              BOARD OF DIRECTORS



                                      9
<PAGE>

          SECTION 1. General Powers. Except as otherwise provided in the
Charter, the business and affairs of the Corporation shall be managed under
the direction of the Board of Directors. All powers of the Corporation may be
exercised by or under authority of the Board of Directors except as conferred
on or reserved to the stockholders by law, by the Charter or by these Bylaws.

          SECTION 2. Number, Classification, Election and Term of Directors.
The number of directors shall be fixed from time to time by resolution of the
Board of Directors adopted by a majority of the directors then in office;
provided, however, that the number of directors shall in no event be fewer
than three (3) nor, subject to the charter of the Corporation, more than
eleven (11). Pursuant to the Corporation's election to be subject to Section
3-803 of the MGCL, the directors, excluding directors elected separately by
holders of preferred stock of the Corporation (the "Preferred Stock
Directors"), shall be divided into three classes, as nearly equal in number as
possible, with the term of office of the first class to expire at the first
subsequent annual meeting of stockholders, and the term of office of the
second class to expire at the second subsequent annual meeting of
stockholders, and the term of office of the third class to expire at the third
subsequent annual meeting of stockholders. At each annual meeting of
stockholders, successors to the class of directors whose term expires at that
annual meeting shall be elected for a three year term and the Preferred Stock
Directors, if any, shall be elected for a one year term, and each director
elected shall hold office until his successor is elected and qualifies, until
his death or until he shall have resigned or have been removed as provided in
these Bylaws, or as otherwise provided by statute or the Charter. Any vacancy
on the Board of Directors may be filled in accordance with Section 5 of this
Article II. No reduction in the number of directors shall have the effect of
removing any director from office prior to the expiration of his term unless
the director is specifically removed pursuant to Section 4 of this Article II
at the time of the decrease. A director need not be a stockholder of the
Corporation, a citizen of the United States or a resident of the State of
Maryland.

          SECTION 3. Resignation. A director of the Corporation may resign at
any time by giving written notice of his resignation to the Board of Directors
or to the President or the Secretary of the Corporation. Any resignation shall
take effect at the time specified in it or, should the time when it is to
become effective not be specified in it, immediately upon its receipt. Unless
the resignation states otherwise, acceptance of a resignation shall not be
necessary to make it effective.

          SECTION 4. Removal of Directors. Any director of the Corporation may
be removed by the stockholders, with or without cause, by a vote of a majority
of the votes entitled to be cast for the election of directors.

          SECTION 5. Vacancies. Subject to the provisions of the Investment
Company Act, any vacancies in the Board of Directors, whether arising from
death, resignation, removal or any other cause except an increase in the
number of directors, shall be filled by a vote of the majority of the
directors then in office even though that majority is less than a quorum,
provided that no vacancy or vacancies shall be filled by action of the
remaining directors if, after the filling of the vacancy or vacancies, fewer
than two-thirds of the directors then holding office shall have been elected
by the stockholders of the Corporation. A majority of the entire Board in
office at the time

                                      10
<PAGE>

of the increase may fill a vacancy that results from an increase in the number
of directors. In the event that at any time a vacancy exists in any office of
a director that may not be filled by the remaining directors, a special
meeting of the stockholders shall be held as promptly as possible and in any
event within sixty (60) days, for the purpose of filling the vacancy or
vacancies. Pursuant to the Corporation's election to be subject to Section
3-804(c)(3) of the MGCL, any director elected by the Board of Directors to
fill a vacancy shall hold office for the remainder of the full term of the
class of directors in which the vacancy occurred and until a successor is
elected and qualifies or until his earlier death, resignation or removal.

          SECTION 6. Place of Meetings. Meetings of the Board of Directors may
be held at any place that the Board of Directors may from time to time
determine or that is specified in the notice of the meeting.

          SECTION 7. Regular Meetings. Regular meetings of the Board of
Directors may be held without notice at the time and place determined by the
Board of Directors.

          SECTION 8. Special Meetings. Special meetings of the Board of
Directors may be called by a majority of the directors of the Corporation or
by the President.

          SECTION 9. Annual Meeting. The annual meeting of the Board of
Directors shall be held as soon as practicable after the meeting of
stockholders at which the directors were elected. No notice of such annual
meeting shall be necessary if held immediately after the adjournment, and at
the site, of the meeting of stockholders. If not so held, notice shall be
given as hereinafter provided for special meetings of the Board of Directors.

          SECTION 10. Notice of Special Meetings. Notice of each special
meeting of the Board of Directors shall be given by the Secretary or the
President as hereinafter provided. Each notice shall state the time and place
of the meeting and shall be delivered to each director, either personally or
by telephone or other standard form of telecommunication, at least twenty-four
(24) hours before the time at which the meeting is to be held, or by
first-class mail, postage prepaid, addressed to the director at his residence
or usual place of business, and mailed at least three (3) days before the day
on which the meeting is to be held.

          SECTION 11. Waiver of Notice of Meetings. Notice of any special
meeting need not be given to any director who shall, either before or after
the meeting, sign a written waiver of notice that is filed with the records of
the meeting or who shall attend the meeting.

          SECTION 12. Quorum and Voting. A majority of the members of the
entire Board of Directors shall be present in person at any meeting of the
Board so as to constitute a quorum for the transaction of business at the
meeting, and, except as otherwise expressly required by statute, the Charter,
these Bylaws, the Investment Company Act, or any other applicable statute, the
act of a majority of the directors present at any meeting at which a quorum is
present shall be the act of the Board. In the absence of a quorum at any
meeting of the Board, a majority of the directors present may adjourn the
meeting to another time and place, and notice of any adjourned meeting shall
be

                                      11
<PAGE>

given to the directors who were not present at the time of the adjournment
and, unless the time and place were announced at the meeting at which the
adjournment was taken, to the other directors. At any adjourned meeting at
which a quorum is present, any business may be transacted that might have been
transacted at the meeting as originally called.

          SECTION 13. Organization. The President or, in his absence or
inability to act, another director chosen by a majority of the directors
present shall act as chairman of the meeting and preside at the meeting. The
Secretary (or, in his absence or inability to act, any person appointed by the
chairman) shall act as secretary of the meeting and keep the minutes of the
meeting.

          SECTION 14. Committees. The Board of Directors may designate one (1)
or more committees of the Board of Directors, each consisting of one (1) or
more directors. To the extent provided in the resolution and permitted by law,
the committee or committees shall have and may exercise the powers of the
Board of Directors in the management of the business and affairs of the
Corporation. Any committee or committees shall have the name or names
determined from time to time by resolution adopted by the Board of Directors.
Each committee shall keep regular minutes of its meetings and provide those
minutes to the Board of Directors when required. The members of a committee
present at any meeting, whether or not they constitute a quorum, may appoint a
director to act in the place of an absent member.

          SECTION 15. Written Consent of Directors in Lieu of a Meeting.
Subject to the provisions of the Investment Company Act, any action required
or permitted to be taken at any meeting of the Board of Directors or of any
committee of the Board may be taken without a meeting if all members of the
Board or committee, as the case may be, consent thereto in writing, and the
writing or writings are filed with the minutes of the proceedings of the Board
or committee.

          SECTION 16. Telephone Conference. Members of the Board of Directors
or any committee of the Board may participate in any Board or committee
meeting by means of a conference telephone or similar communications equipment
by means of which all persons participating in the meeting can hear each other
at the same time. Participation by such means shall constitute presence in
person at the meeting.

          SECTION 17. Compensation. Each director shall be entitled to receive
such compensation, if any, as may from time to time be fixed by the Board of
Directors, including a fee for each meeting of the Board or any committee
thereof, regular or special, he attends. Directors may also be reimbursed by
the Corporation for all reasonable expenses incurred in traveling to and from
the place of a Board or committee meeting.


                                  ARTICLE III

                        OFFICERS, AGENTS AND EMPLOYEES



                                      12
<PAGE>

          SECTION 1. Number and Qualifications. The officers of the
Corporation shall be a President, a Secretary and a Treasurer, each of whom
shall be elected by the Board of Directors. The Board of Directors may elect
or appoint one (1) or more Vice Presidents and may also appoint any other
officers, agents and employees it deems necessary or proper. Any two (2) or
more offices may be held by the same person, except the office of President
and Vice President, but no officer shall execute, acknowledge or verify in
more than one capacity any instrument required by law to be executed,
acknowledged or verified in more than one capacity. Officers shall be elected
by the Board of Directors each year at its first meeting held after the annual
meeting of stockholders, each to hold office until the meeting of the Board
following the next annual meeting of the stockholders and until his successor
shall have been duly elected and shall have qualified, until his death or
until he shall have resigned or have been removed, as provided by these
Bylaws. The Board of Directors may from time to time elect such officers
(including one or more Assistant Vice Presidents, one or more Assistant
Treasurers and one or more Assistant Secretaries) and may appoint, or delegate
to the President the power to appoint, such agents as may be necessary or
desirable for the business of the Corporation. Such other officers and agents
shall have such duties and shall hold their offices for such terms as may be
prescribed by the Board or by the appointing authority.

          SECTION 2. Resignations. Any officer of the Corporation may resign
at any time by giving written notice of his resignation to the Board of
Directors, the President or the Secretary. Any resignation shall take effect
at the time specified therein or, if the time when it shall become effective
is not specified therein, immediately upon its receipt. Unless otherwise
stated in the resignation, the acceptance of a resignation shall not be
necessary to make it effective.

          SECTION 3. Removal of Officer, Agent or Employee. Any officer, agent
or employee of the Corporation may be removed by the Board of Directors, with
or without cause, at any time if the Board of Directors in its judgment finds
that the best interests of the Corporation will be served thereby, and the
Board may delegate the power of removal as to agents and employees not elected
or appointed by the Board of Directors. Removal shall be without prejudice to
the person's contract rights, if any, but the appointment of any person as an
officer, agent or employee of the Corporation shall not of itself create
contract rights.

          SECTION 4. Vacancies. A vacancy in any office, whether arising from
death, resignation, removal or any other cause, may be filled for the
unexpired portion of the term of the office that shall be vacant, in the
manner prescribed in these Bylaws for the regular election or appointment to
the office.

          SECTION 5. Compensation. The compensation of the officers of the
Corporation shall be fixed by the Board of Directors, but this power may be
delegated to any officer with respect to other officers under his control.

          SECTION 6. Bonds or Other Security. If required by the Board, any
officer, agent or employee of the Corporation shall give a bond or other
security for the faithful performance of his duties, in an amount and with any
surety or sureties as the Board may require.



                                      13
<PAGE>

          SECTION 7. President. The President shall be the chief executive
officer of the Corporation and shall preside at all meetings of the
stockholders and of the Board of Directors. The President shall, subject to
the control of the Board of Directors, have general charge of the business and
affairs of the Corporation and may employ and discharge employees and agents
of the Corporation, except those elected or appointed by the Board, and he may
delegate these powers.

          SECTION 8. Vice President. Each Vice President shall have the powers
and perform the duties that the Board of Directors or the President may from
time to time prescribe.

          SECTION 9. Treasurer. Subject to the provisions of any contract that
may be entered into with any custodian pursuant to authority granted by the
Board of Directors, the Treasurer shall have charge of all receipts and
disbursements of the Corporation and shall have or provide for the custody of
the Corporation's funds and securities; he shall have full authority to
receive and give receipts for all money due and payable to the Corporation,
and to endorse checks, drafts and warrants, in its name and on its behalf, and
to give full discharge for the same; he shall deposit all funds of the
Corporation, except those that may be required for current use, in such banks
or other places of deposit as the Board of Directors may from time to time
designate; and he shall, in general, perform all duties incident to the office
of Treasurer and such other duties as may from time to time be assigned to him
by the Board of Directors or the President.

          SECTION 10. Secretary. The Secretary shall:

                  (a) Keep or cause to be kept, in one or more books provided
for the purpose, the minutes of all meetings of the Board of Directors, the
committees of the Board and the stockholders;

                  (b) See that all notices are duly given in accordance with the
provisions of these Bylaws and as required by law;

                  (c) Be custodian of the records and the seal of the
Corporation and affix and attest the seal to all stock certificates of the
Corporation (unless the seal of the Corporation on such certificates shall be a
facsimile, as hereinafter provided) and affix and attest the seal to all other
documents to be executed on behalf of the Corporation under its seal;

                  (d) See that the books, reports, statements, certificates and
other documents and records required by law to be kept and filed are properly
kept and filed; and

                  (e) In general, perform all the duties incident to the office
of Secretary and such other duties as from time to time may be assigned to him
by the Board of Directors or the President.

          SECTION 11. Delegation of Duties. In case of the absence of any
officer of the Corporation, or for any other reason that the Board of
Directors may deem sufficient, the Board may

                                      14
<PAGE>

confer for the time being the powers or duties, or any of them, of such
officer upon any other officer or upon any director.


                                  ARTICLE IV

                                     STOCK

          SECTION 1. Stock Certificates. To the extent provided by the Board
of Directors, each holder of stock of the Corporation shall be entitled to
have a certificate or certificates representing shares of stock of the
Corporation owned by him. Such certificates shall be in a form approved by the
Board, signed by or in the name of the Corporation by the President or a Vice
President and by the Secretary or an Assistant Secretary or the Treasurer or
an Assistant Treasurer and sealed with the seal of the Corporation. Any or all
of the signatures or the seal on the certificate may be facsimiles. In case
any officer, transfer agent or registrar who has signed or whose facsimile
signature has been placed upon a certificate shall have ceased to be such
officer, transfer agent or registrar before the certificate is issued, it may
nevertheless be issued by the Corporation with the same effect as if the
officer, transfer agent or registrar was still in office at the date of issue.

          SECTION 2. Stock Ledger. There shall be maintained a stock ledger
containing the name and address of each stockholder and the number of shares
of stock of each class the stockholder holds. The stock ledger may be in
written form or any other form which can be converted within a reasonable time
into written form for visual inspection. The original or a duplicate of the
stock ledger shall be kept at the principal office of the Corporation, at the
office of the transfer agent for such shares or at any other office or agency
specified by the Board of Directors.

          SECTION 3. Transfers of Shares. Transfers of shares of stock of the
Corporation shall be made on the stock records of the Corporation only by the
registered holder of the shares, or by his attorney thereunto authorized by
power of attorney duly executed and filed with the Secretary or with a
transfer agent or transfer clerk, and on surrender of the certificate or
certificates, if issued, for the shares properly endorsed or accompanied by a
duly executed stock transfer power and the payment of all taxes thereon.
Except as otherwise provided by law, the Corporation shall be entitled to
recognize the exclusive right of a person in whose name any share or shares
stand on the record of stockholders as the owner of the share or shares for
all purposes, including, without limitation, the rights to receive dividends
or other distributions and to vote as the owner, and the Corporation shall not
be bound to recognize any equitable or legal claim to or interest in any such
share or shares on the part of any other person.

          SECTION 4. Regulations. The Board of Directors may authorize the
issuance of uncertificated securities if permitted by law. If stock
certificates are issued, the Board of Directors may make any additional rules
and regulations, not inconsistent with these Bylaws, as it may deem expedient
concerning the issue, transfer and registration of certificates for shares of
stock of the Corporation. The Board may appoint, or authorize any officer or
officers to appoint, one or more

                                      15
<PAGE>

transfer agents or one or more transfer clerks and one or more registrars and
may require all certificates for shares of stock to bear the signature or
signatures of any of them.

          SECTION 5. Lost, Destroyed or Mutilated Certificates. The holder of
any certificate representing shares of stock of the Corporation shall
immediately notify the Corporation of its loss, destruction or mutilation, and
the Corporation may issue a new certificate of stock in the place of any
certificate issued by it that has been alleged to have been lost or destroyed
or that shall have been mutilated. The Board may, in its absolute discretion,
require the owner (or his legal representative) of a lost, destroyed or
mutilated certificate to give to the Corporation a bond in a sum, limited or
unlimited, and form and with any surety or sureties, as the Board in its
absolute discretion shall determine, to indemnify the Corporation against any
claim that may be made against it on account of the alleged loss or
destruction of any such certificate or issuance of a new certificate. Anything
herein to the contrary notwithstanding, the Board of Directors may, in its
absolute discretion, refuse to issue any such new certificate, except pursuant
to legal proceedings under the MGCL.

          SECTION 6. Fixing of Record Date for Dividends, Distributions, etc.
The Board may fix, in advance, a date not more than ninety (90) days preceding
the date fixed for the payment of any dividend or the making of any
distribution or the allotment of rights to subscribe for securities of the
Corporation, or for the delivery of evidences of rights or evidences of
interests arising out of any change, conversion or exchange of common stock or
other securities, as the record date for the determination of the stockholders
entitled to receive any such dividend, distribution, allotment, rights or
interests, and in such case only the stockholders of record at the time so
fixed shall be entitled to receive such dividend, distribution, allotment,
rights or interests.

          SECTION 7. Information to Stockholders and Others. Any stockholder
of the Corporation or his agent may, during the Corporation's usual business
hours, inspect and copy the Corporation's Bylaws, minutes of the proceedings
of its stockholders, annual statements of its affairs and voting trust
agreements on file at its principal office.


                                   ARTICLE V

                         INDEMNIFICATION AND INSURANCE

          SECTION 1. Indemnification of Directors and Officers. Any person who
was or is a party or is threatened to be made a party in any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that such person is a
current or former director or officer of the Corporation, or is or was serving
while a director or officer of the Corporation at the request of the
Corporation as a director, officer, partner, trustee, employee, agent or
fiduciary of another domestic or foreign corporation, partnership, joint
venture, trust, enterprise or employee benefit plan shall be indemnified by
the Corporation against judgments, penalties, fines, excise taxes, settlements
and reasonable expenses (including attorneys' fees) actually incurred by such
person in connection with such action, suit or proceeding to the

                                      16
<PAGE>

fullest extent permissible under the MGCL and the Investment Company Act, as
those statutes are now or hereafter in force, except that such indemnity shall
not protect any such person against any liability to the Corporation or any
stockholder thereof 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 his office ("disabling conduct").

          SECTION 2. Advances. Any current or former director or officer of
the Corporation claiming indemnification within the scope of this Article V
shall be entitled to advances from the Corporation for payment of the
reasonable expenses incurred by him in connection with proceedings to which he
is a party in the manner and to the fullest extent permissible under the MGCL
and the Investment Company Act, as those statutes are now or hereafter in
force; provided, however, that the person seeking indemnification shall
provide to the Corporation a written affirmation of his good faith belief that
the standard of conduct necessary for indemnification by the Corporation 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, and
provided further that at least one (1) of the following additional conditions
is met: (a) the person seeking indemnification shall provide a security in
form and amount acceptable to the Corporation for his undertaking; (b) the
Corporation is insured against losses arising by reason of the advance; or (c)
a majority of a quorum of directors of the Corporation who are neither
"interested persons" as defined in Section 2(a)(19) of the Investment Company
Act, nor parties to the proceeding ("disinterested non-party directors"), or
independent legal counsel, in a written opinion, shall determine, based on a
review of facts readily-available to the Corporation at the time the advance
is proposed to be made, that there is reason to believe that the person
seeking indemnification will ultimately be found to be entitled to
indemnification.

          SECTION 3. Procedure. At the request of any current or former
director or officer, or any employee or agent whom the Corporation proposes to
indemnify, the Board of Directors shall determine, or cause to be determined,
in a manner consistent with the MGCL and the Investment Company Act, as those
statutes are now or hereafter in force, whether the standards required by this
Article V and Section 2-418 of the MGCL have been met; provided, however, that
indemnification shall be made only following: (a) a final decision on the
merits by a court or other body before whom the proceeding was brought that
the person to be indemnified was not liable by reason of disabling conduct or
(b) in the absence of such a decision, a reasonable determination, based upon
a review of the facts, that the person to be indemnified was not liable by
reason of disabling conduct, by (i) the vote of a majority of a quorum of
disinterested non-party directors or (ii) an independent legal counsel in a
written opinion.

          SECTION 4. Indemnification of Employees and Agents. Employees and
agents who are not officers or directors of the Corporation may be
indemnified, and reasonable expenses may be advanced to such employees or
agents, in accordance with the procedures set forth in this Article V to the
extent permissible under the MGCL and the Investment Company Act, as those
statutes are now or hereafter in force, and to such further extent, consistent
with the foregoing, as may be provided by action of the Board of Directors or
by contract.



                                      17
<PAGE>

          SECTION 5. Other Rights. The indemnification provided by this
Article V shall not be deemed exclusive of any other right, with respect to
indemnification or otherwise, to which those seeking such indemnification may
be entitled under any insurance or other agreement, vote of stockholders or
disinterested directors or otherwise, both as to action by a director or
officer of the Corporation in his capacity as such and as to action by such
person in another capacity while holding such office or position, and shall
continue as to a person who has ceased to be a director or officer and shall
inure to the benefit of the heirs, executors and administrators of such a
person.

          SECTION 6. Insurance. The Corporation shall have the power to
purchase and maintain insurance on behalf of any person who is or was a
director, officer, employee or agent of the Corporation, or who, while a
director, officer, employee or agent of the Corporation, is or was serving at
the request of the Corporation as a director, officer, partner, trustee,
employee, agent or fiduciary of another domestic or foreign corporation,
partnership, joint venture, trust, enterprise or employee benefit plan,
against any liability asserted against and incurred by him in any such
capacity or arising out of his status as such, whether or not the Corporation
would have the power to indemnify him against such liability.


                                  ARTICLE VI

                                     SEAL

          The seal of the Corporation shall be circular in form and shall bear
the name of the Corporation, the year of its incorporation, the words
"Corporate Seal" and "Maryland" and any emblem or device approved by the Board
of Directors. The seal may be used by causing it or a facsimile to be
impressed or affixed or in any other manner reproduced, or by placing the word
"(Seal)" adjacent to the signature of the authorized officer of the
Corporation.


                                  ARTICLE VII

                                  FISCAL YEAR

          SECTION 1. Fiscal Year. The Corporation's fiscal year shall be fixed
by the Board of Directors.

          SECTION 2. Accountant.

                  (a) The Corporation shall employ an independent public
accountant or a nationally-recognized firm of independent public accountants
as its Accountant to examine the accounts of the Corporation and to certify
financial statements of the Corporation. The Accountant's certificates and
reports shall be addressed both to the Board of Directors and to the
stockholders. The employment of the Accountant shall be conditioned upon the
right of the

                                      18
<PAGE>

Corporation to terminate the employment forthwith without any
penalty by vote of a majority of the outstanding voting securities at any
stockholders' meeting called for that purpose.

                  (b) A majority of the members of the Board of Directors who
are not "interested persons" (as such term is defined in the Investment Company
Act) of the Corporation shall select the Accountant at any meeting held within
thirty (30) days before or after the beginning of the fiscal year of the
Corporation or before the annual stockholders' meeting in that year. Such
selection shall be submitted for ratification or rejection at the next
succeeding annual stockholders' meeting. If such meeting shall reject such
selection, the Accountant shall be selected by majority vote of the
Corporation's outstanding voting securities, either at the meeting at which
the rejection occurred or at a subsequent meeting of stockholders called for
that purpose.

                  (c) Any vacancy occurring between annual meetings, due to the
resignation of the Accountant, may be filled by the vote of a majority of the
members of the Board of Directors who are not "interested persons" of the
Corporation, as that term is defined in the Investment Company Act, at a
meeting called for the purpose of voting on such action.


                                 ARTICLE VIII

                             CUSTODY OF SECURITIES

          SECTION 1. Employment of a Custodian. The Corporation shall place
and at all times maintain in the Custodian (including any sub-custodian for
the Custodian) all funds, securities and similar investments owned by the
Corporation. The Custodian (and any sub-custodian) shall be an institution
conforming to the requirements of Section 17(f) of the Investment Company Act,
and the rules of the Securities and Exchange Commission thereunder. The
Custodian shall be appointed from time to time by the Board of Directors,
which shall fix its remuneration.

          Subject to such rules, regulations and orders as the Securities and
Exchange Commission may adopt, the Corporation may direct the Custodian to
deposit all or any part of the securities owned by the Corporation in a system
for the central handling of securities established by a national securities
exchange or a national securities association registered with the Securities
and Exchange Commission, or otherwise in accordance with the Investment
Company Act, pursuant to which system all securities of any particular class
of any issuer deposited within the system are treated as fungible and may be
transferred or pledged by bookkeeping entry without physical delivery of such
securities, provided that all such deposits shall be subject to withdrawal
only upon the order of the Corporation or the Custodian.

          SECTION 2. Termination of Custodian Agreement. Upon termination of
the Custodian Agreement or inability of the Custodian to continue to serve,
the Board of Directors shall promptly appoint a successor Custodian, but in
the event that no successor Custodian can be found who has the required
qualifications and is willing to serve, the Board of Directors shall call as
promptly as possible a special meeting of the stockholders to determine
whether the Corporation

                                      19
<PAGE>

shall function without a Custodian or shall be liquidated. If so directed by
vote of the holders of a majority of the outstanding shares of stock entitled
to vote of the Corporation, the Custodian shall deliver and pay over all
property of the Corporation held by it as specified in such vote.


                                  ARTICLE IX

                                  AMENDMENTS

          These Bylaws may be amended or repealed by the affirmative vote of a
majority of the Board of Directors at any regular or special meeting of the
Board of Directors, subject to the requirements of the Investment Company Act.




Dated:  December 17, 2002

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.D1
<SEQUENCE>11
<FILENAME>efc2-1398_exhibitd1.txt
<TEXT>
                                                                Exhibit (d)(1)



NUMBER _______                                     SHARES ______________
COMMON STOCK                                       COMMON STOCK
INCORPORATED UNDER THE LAWS                        THIS CERTIFICATE IS
OF THE STATE OF MARYLAND                           TRANSFERABLE IN BOSTON,
                                                   MASS., OR IN NEW YORK, NY

                                                   CUSIP 780910 10 5
                                           See Reverse For Certain Definitions


                            ROYCE VALUE TRUST, INC.


This Certifies that

is the owner of

          FULLY PAID AND NON-ASSESSABLE SHARES OF THE COMMON STOCK OF THE PAR
VALUE OF $.001 EACH OF Royce Value Trust, Inc. transferable on the books of
the Corporation by the holder in person or by duly authorized attorney upon
surrender of this Certificate properly endorsed. This Certificate is not valid
unless countersigned by the Transfer Agent and registered by Registrar.

          Witness the facsimile seal of the Corporation and the facsimile
signatures of its duly authorized officers.

Dated:


- ------------------------------      -----------------------------------------
Secretary                           President

Countersigned and Registered:

STATE STREET BANK AND TRUST COMPANY (BOSTON)



Transfer Agent and Registrar

By:
   --------------------------------------------------
     Authorized Signature


<PAGE>

                            ROYCE VALUE TRUST, INC.

     The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:

<TABLE>
<CAPTION>

<S>                                         <C>
TEN COM--as tenants in common               UNIF GIFT MIN ACT--_______Custodian_________
                                                                  (Cust)      (Minor)

TEN ENT--as tenants by the entireties         under Uniform Gifts to Minors Act _________
                                                                             (State)
JT TEN --as joint tenants with right
              of survivorship and not as
              tenants in common
</TABLE>

    Additional abbreviations may also be used though not in the above list.

     For value received,................. hereby sell, assign and transfer
unto

  PLEASE INSERT SOCIAL SECURITY OR OTHER
      IDENTIFYING NUMBER OF ASSIGNEE
______________________________________________________________(Please print or
typewrite name and address including zip code of assignee) ________________
shares of the capital stock represented by the within Certificate, and do
hereby irrevocably constitute and appoint _____________ Attorney to transfer
the said stock on the books of the within named Corporation with full power of
substitution in the premises.

Dated:__________________



                                         Signature:___________________________

                      NOTICE:  THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND
                               WITH THE NAME AS WRITTEN UPON THE FACE OF THE
                               CERTIFICATE, IN EVERY PARTICULAR, WITHOUT
                               ALTERATION OR ENLARGEMENT, OR ANY CHANGE
                               WHATEVER.



                                      2


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.J1
<SEQUENCE>12
<FILENAME>efc2-1398_exhibitj1.txt
<TEXT>
                                                                Exhibit (j)(1)



                              CUSTODIAN CONTRACT

                                    Between

                            ROYCE VALUE TRUST, INC.

                                      and

                      STATE STREET BANK AND TRUST COMPANY

<PAGE>

<TABLE>
<CAPTION>
                                                  TABLE OF CONTENTS

                                                                                                               Page

<S>                                                                                                             <C>
1.       Employment of Custodian and Property to be Held by It....................................................1

2.       Duties of the Custodian with Respect to Property of the Fund Held By the Custodian.......................1

         2.1      Holding Securities..............................................................................1
         2.2      Delivery of Securities..........................................................................1
         2.3      Registration of Securities......................................................................3
         2.4      Bank Accounts...................................................................................3
         2.5      Investment and Availability of Federal Funds....................................................4
         2.6      Collection of Income............................................................................4
         2.7      Payment of Fund Moneys..........................................................................4
         2.8      Liability for Payment in Advance of Receipt of Securities Purchased.............................5
         2.9      Appointment of Agents...........................................................................5
         2.10     Deposit of Fund Assets in Securities Systems....................................................5
         2.11     Segregated Account..............................................................................6
         2.12     Ownership Certificates for Tax Purposes.........................................................7
         2.13     Proxies.........................................................................................7
         2.14     Communications Relating to Fund Portfolio Securities............................................7
         2.15     Proper Instructions.............................................................................7
         2.16     Actions Permitted without Express Authority.....................................................8
         2.17     Evidence of Authority...........................................................................8

3.       Duties of Custodian with Respect to the Books of Account and Calculation of
         Net Asset Value and Net Income...........................................................................8

4.       Records..................................................................................................9

5.       Opinion of Fund's Independent Accountant.................................................................9

6.       Reports to Fund by Independent Public Accountants........................................................9

7.       Compensation of Custodian................................................................................9

8.       Responsibility of Custodian..............................................................................9

9.       Effective Period, Termination and Amendment.............................................................10

10.      Successor Custodian.....................................................................................11

11.      Interpretive and Additional Provisions..................................................................11

12.      Massachusetts Law to Apply..............................................................................11

13.      Prior Contracts.........................................................................................12
</TABLE>

<PAGE>

                              CUSTODIAN CONTRACT

          This Contract between Royce Value Trust, Inc., a corporation
organized and existing under the laws of Maryland, having its principal place
of business at 1414 Avenue of the Americas, 9th Floor, New York, New York
10019, hereinafter called the "Fund", and State Street Bank and Trust Company,
a Massachusetts corporation, having its principal place of business at 225
Franklin Street, Boston, Massachusetts, 02110, hereinafter called the
"Custodian",

          WITNESSETH: That in consideration of the mutual covenants and
agreements hereinafter contained, the parties hereto agree as follows:

     1. Employment of Custodian and Property to be Held by It

          The Fund hereby employs the Custodian as the custodian of its assets
pursuant to the provisions of the Articles of Incorporation. The Fund agrees
to deliver to the Custodian all securities and cash owned by it, and all
payments of income, payments of principal or capital distributions received by
it with respect to all securities owned by the Fund from time to time, and the
cash consideration received by it for such new or treasury shares of capital
stock, $.001 par value, ("Shares") of the Fund as may be issued or sold from
time to time. The Custodian shall not be responsible for any property of the
Fund held or received by the Fund and not delivered to the Custodian.

          Upon receipt of "Proper Instructions" (within the meaning of Section
2.14), the Custodian shall from time to time employ one or more
sub-custodians, but only in accordance with an applicable vote by the Board of
Directors of the Fund, and provided that the Custodian shall have no more or
less responsibility or liability to the Fund on account of any actions or
omissions of any sub-custodian so employed than any such sub-custodian has to
the Custodian.

     2. Duties of the Custodian with Respect to Property of the Fund Held By
the Custodian

          2.1 Holding Securities. The Custodian shall hold and physically
segregate for the account of the Fund all non-cash property, including all
securities owned by the Fund, other than securities which are maintained
pursuant to Section 2.10 in a clearing agency which acts as a securities
depository or in a book-entry system authorized by the U.S. Department of the
Treasury, collectively referred to herein as "Securities System".

          2.2 Delivery of Securities. The Custodian shall release and deliver
securities owned by the Fund held by the Custodian or in a Securities System
account of the Custodian only upon receipt of Proper Instructions, which may
be continuing instructions when deemed appropriate by the parties, and only in
the following cases:

          1)   Upon sale of such securities for the account of the Fund and
               receipt of payment therefor;

          2)   Upon the receipt of payment in connection with any repurchase
               agreement related to such securities entered into by the Fund;

<PAGE>

          3)   In the case of a sale effected through a Securities System, in
               accordance with the provisions of section 2.10 hereof;

          4)   To the depository agent in connection with tender or other
               similar offers for portfolio securities of the Fund;

          5)   To the issuer thereof or its agent when such securities are
               called, redeemed, retired or otherwise become payable; provided
               that, in any such case, the cash or other consideration is to
               be delivered to the Custodian;

          6)   To the issuer thereof, or its agent, for transfer into the name
               of the Fund or into the name of any nominee or nominees of the
               Custodian or into the name or nominee name of any agent
               appointed pursuant to Section 2.9 or into the name or nominee
               name of any sub-custodian appointed pursuant to Article 1; or
               for exchange for a different number of bonds, certificates or
               other evidence representing the same aggregate face amount or
               number of units; provided that, in any such case, the new
               securities are to be delivered to the Custodian;

          7)   To the broker selling the same for examination in accordance
               with the "street delivery" custom;

          8)   For exchange or conversion pursuant to any plan of merger,
               consolidation, recapitalization, reorganization or readjustment
               of the securities of the issuer of such securities, or pursuant
               to provisions for conversion contained in such securities, or
               pursuant to any deposit agreement; provided that, in any such
               case, the new securities and cash, if any, are to be delivered
               to the Custodian;

          9)   In the case of warrants, rights or similar securities, the
               surrender thereof in the exercise of such warrants, rights or
               similar securities or the surrender of interim receipts or
               temporary securities for definitive securities; provided that,
               in any such case, the new securities and cash, if any, are to
               be delivered to the Custodian;

          10)  For delivery in connection with any loans of securities made by
               the Fund, but only against receipt of adequate collateral as
               agreed upon from time to time by the Custodian and the Fund,
               which may be in the form of cash or obligations issued by the
               United States government, its agencies or instrumentalities,
               except that in connection with any loans for which collateral
               is to be credited to the Custodian's account in the book-entry
               system authorized by the U.S. Department of the Treasury, the
               Custodian will not be held liable or responsible for the
               delivery of securities owned by the Fund prior to the receipt
               of such collateral;

          11)  For delivery as security in connection with any borrowings by
               the Fund requiring a pledge of assets by the Fund, but only
               against receipt of amounts borrowed;



                                      2
<PAGE>

          12)  For delivery in accordance with the provisions of any agreement
               among the Fund, the Custodian and a broker-dealer registered
               under the securities Exchange Act of 1934 (the "Exchange Act")
               and a member of The National Association of Securities Dealers,
               Inc. ("NASD"), relating to compliance with the rules of The
               Options Clearing Corporation and of any registered national
               securities exchange, or of any similar organization or
               organizations, regarding escrow or other arrangements in
               connection with transactions by the Fund;

          13)  For delivery in accordance with the provisions of any agreement
               among the Fund, the Custodian, and a Futures Commission
               Merchant registered under the Commodity Exchange Act, relating
               to compliance with the rules of the Commodity Futures Trading
               Commission and/or any Contract Market, or any similar
               organization or organizations, regarding account deposits in
               connection with transactions by the Fund; and

          14)  For any other proper corporate purpose, but only upon receipt
               of, in addition to Proper Instructions, a certified copy of a
               resolution of the Board of Directors or of the Executive
               Committee signed by an officer of the Fund and certified by the
               Secretary or an Assistant Secretary, specifying the securities
               to be delivered, setting forth the purpose for which such
               delivery is to be made, declaring such purpose to be a proper
               corporate purpose, and naming the person or persons to whom
               delivery of such securities shall be made.

          2.3 Registration of Securities. Securities held by the Custodian
(other than bearer securities) shall be registered in the name of the Fund or
in the name of any nominee of the Fund or of any nominee of the Custodian
which nominee shall be assigned exclusively to the Fund, unless the Fund has
authorized in writing the appointment of a nominee to be used in common with
other registered investment companies having the same investment adviser as
the Fund, or in the name or nominee name of any agent appointed pursuant to
Section 2.9 or in the name or nominee name of any sub-custodian appointed
pursuant to Article 1. All securities accepted by the Custodian on behalf of
the Fund under the terms of this Contract shall be in "street name" or other
good delivery form.

          2.4 Bank Accounts. The Custodian shall open and maintain a separate
bank account or accounts in the name of the Fund, subject only to draft or
order by the Custodian acting pursuant to the terms of this Contract, and
shall hold in such account or accounts, subject to the provisions hereof, all
cash received by it from or for the account of the Fund, other than cash
maintained by the Fund in a bank account established and used in accordance
with Rule 17f-3 under the Investment Company Act of 1940. Funds held by the
Custodian for the Fund may be deposited by it to its credit as Custodian in
the Banking Department of the Custodian or in such other banks or trust
companies as it may in its discretion deem necessary or desirable; provided,
however, that every such bank or trust company shall be qualified to act as a
custodian under the Investment Company Act of 1940 and that each such bank or
trust company and the funds to be deposited with each such bank or trust
company shall be approved by vote of a



                                      3
<PAGE>

majority of the Board of Directors of the Fund. Such funds shall be deposited
by the Custodian in its capacity as Custodian and shall be withdrawable by the
Custodian only in that capacity.

          2.5 Investment and Availability of Federal Funds. Upon mutual
agreement between the Fund and the Custodian, the Custodian shall, upon the
receipt of Proper Instructions, make federal funds available to the Fund as of
specified times agreed upon from time to time by the Fund and the Custodian in
the amount of checks received in payment for Shares of the Fund which are
deposited into the Fund's account.

          2.6 Collection of Income. The Custodian shall collect on a timely
basis all income and other payments with respect to registered securities held
hereunder to which the Fund shall be entitled either by law or pursuant to
custom in the securities business, and shall collect on a timely basis all
income and other payments with respect to bearer securities if, on the date of
payment by the issuer, such securities are held by the Custodian or its agent
thereof and shall credit such income, as collected, to the Fund's custodian
account. Without limiting the generality of the foregoing, the Custodian shall
detach and present for payment all coupons and other income items requiring
presentation as and when they become due and shall collect interest when due
on securities held hereunder. Income due the Fund on securities loaned
pursuant to the provisions of Section 2.2 (10) shall be the responsibility of
the Fund. The Custodian will have no duty or responsibility in connection
therewith, other than to provide the Fund with such information or data as may
be necessary to assist the Fund in arranging for the timely delivery to the
Custodian of the income to which the Fund is properly entitled.

          2.7 Payment of Fund Moneys. Upon receipt of Proper Instructions,
which may be continuing instructions when deemed appropriate by the parties,
the Custodian shall pay out moneys of the Fund in the following cases only:

          1)   Upon the purchase of securities, futures contracts or options
               on futures contracts for the account of the Fund but only (a)
               against the delivery of such securities, or evidence of title
               to futures contracts or options on futures contracts, to the
               Custodian (or any bank, banking firm or trust company doing
               business in the United States or abroad which is qualified
               under the Investment Company Act of 1940, as amended, to act as
               a custodian and has been designated by the Custodian as its
               agent for this purpose) registered in the name of the Fund or
               in the name of a nominee of the Custodian referred to in
               Section 2.3 hereof or in proper form for transfer; (b) in the
               case of a purchase effected through a Securities System, in
               accordance with the conditions set forth in Section 2.10 hereof
               or (c) in the case of repurchase agreements entered into
               between the Fund and the Custodian, or another bank, or a
               broker-dealer which is a member of NASD, (i) against delivery
               of the securities either in certificate form or through an
               entry crediting the Custodian's account at the Federal Reserve
               Bank with such securities or (ii) against delivery of the
               receipt evidencing purchase by the Fund of securities owned by
               the Custodian along with written evidence of the agreement by
               the Custodian to repurchase such securities from the Fund;



                                      4
<PAGE>

          2)   In connection with conversion, exchange or surrender of
               securities owned by the Fund as set forth in Section 2.2
               hereof;

          3)   For the payment of any expense or liability incurred by the
               Fund, including but not limited to the following payments for
               the account of the Fund: interest, taxes, management,
               accounting, transfer agent and legal fees, and operating
               expenses of the Fund whether or not such expenses are to be in
               whole or part capitalized or treated as deferred expenses;

          4)   For the payment of any dividends declared pursuant to the
               governing documents of the Fund;

          5)   For payment of the amount of dividends received in respect of
               securities sold short;

          6)   For any other proper purpose, but only upon receipt of, in
               addition to Proper Instructions, a certified copy of a
               resolution of the Board of Directors or of the Executive
               Committee of the Fund signed by an officer of the Fund and
               certified by its Secretary or an Assistant Secretary,
               specifying the amount of such payment, setting forth the
               purpose for which such payment is to be made, declaring such
               purpose to be a proper purpose, and naming the person or
               persons to whom such payment is to be made.

          2.8 Liability for Payment in Advance of Receipt of Securities
Purchased. In any and every case where payment for purchase of securities for
the account of the Fund is made by the Custodian in advance of receipt of the
securities purchased in the absence of specific written instructions from the
Fund to so pay in advance, the Custodian shall be absolutely liable to the
Fund for such securities to the same extent as if the securities had been
received by the Custodian.

          2.9 Appointment of Agents. The Custodian may at any time or times in
its discretion appoint (and may at any time remove) any other bank or trust
company which is itself qualified under the Investment Company Act of 1940, as
amended, to act as a custodian, as its agent to carry out such of the
provisions of this Article 2 as the Custodian may from time to time direct;
provided, however, that the appointment of any agent shall not relieve the
Custodian of its responsibilities or liabilities hereunder.

          2.10 Deposit of Fund Assets in Securities Systems. The Custodian may
deposit and/or maintain securities owned by the Fund in a clearing agency
registered with the Securities and Exchange Commission under Section 17A of
the Securities Exchange Act of 1934, which acts as a securities depository, or
in the book-entry system authorized by the U.S. Department of the Treasury and
certain federal agencies, collectively referred to herein as "Securities
System" in accordance with applicable Federal Reserve Board and Securities and
Exchange Commission rules and regulations, if any, and subject to the
following provisions:

          1)   The Custodian may keep securities of the Fund in a Securities
               System, provided that such securities are represented in an
               account ("Account") of



                                      5
<PAGE>

               the Custodian in the Securities System which shall not include
               any assets of the Custodian other than assets held as a
               fiduciary, custodian or otherwise for customers;

          2)   The records of the Custodian with respect to securities of the
               Fund which are maintained in a Securities System shall identify
               by book-entry those securities belonging to the Fund;

          3)   The Custodian shall pay for securities purchased for the
               account of the Fund upon (i) receipt of advice from the
               Securities System that such securities have been transferred to
               the Account, and (ii) the making of an entry on the records of
               the Custodian to reflect such payment and transfer for the
               account of the Fund. The Custodian shall transfer securities
               sold for the account of the Fund upon (i) receipt of advice
               from the Securities System that payment for such securities has
               been transferred to the Account, and (ii) the making of an
               entry on the records of the Custodian to reflect such transfer
               and payment for the account of the Fund. Copies of all advices
               from the Securities System of transfers of securities for the
               account of the Fund shall identify the Fund, be maintained for
               the Fund by the Custodian and be provided to the Fund at its
               request. Upon request, the Custodian shall furnish the Fund
               confirmation of each transfer to or from the account of the
               Fund in the form of a written advice or notice and shall
               furnish to the Fund copies of daily transaction sheets
               reflecting each day's transactions in the Securities System for
               the account of the Fund.

          4)   The Custodian shall provide the Fund with any report obtained
               by the Custodian on the Securities System's accounting system,
               internal accounting control and procedures for safeguarding
               securities deposited in the Securities System;

          5)   The Custodian shall have received the initial or annual
               certificate, as the case may be, required by Article 9 hereof;

          6)   Anything to the contrary in this Contract notwithstanding, the
               Custodian shall be liable to the Fund for any loss or damage to
               the Fund resulting from use of the Securities System by reason
               of any negligence, misfeasance or misconduct of the Custodian
               or any of its agents or of any of its or their employees or
               from failure of the Custodian or any such agent to enforce
               effectively such rights as it may have against the Securities
               System; at the election of the Fund, it shall be entitled to be
               subrogated to the rights of the Custodian with respect to any
               claim against the Securities System or any other person which
               the Custodian may have as a consequence of any such loss or
               damage if and to the extent that the Fund has not been made
               whole for any such loss or damage.

          2.11 Segregated Account. The Custodian shall upon receipt of Proper
Instructions establish and maintain a segregated account or accounts for and
on behalf of the



                                      6
<PAGE>

Fund, into which account or accounts may be transferred cash and/or
securities, including securities maintained in an account by the Custodian
pursuant to Section 2.10 hereof, (i) in accordance with the provisions of any
agreement among the Fund, the Custodian and a broker-dealer registered under
the Exchange Act and a member of the NASD (or any futures commission merchant
registered under the Commodity Exchange Act), relating to compliance with the
rules of The Options Clearing Corporation and of any registered national
securities exchange (or the Commodity Futures Trading Commission or any
registered contract market), or of any similar organization or organizations,
regarding escrow or other arrangements in connection with transactions by the
Fund, (ii) for purposes of segregating cash or government securities in
connection with options purchased, sold or written by the Fund or commodity
futures contracts or options thereon purchased or sold by the Fund, (iii) for
the purposes of compliance by the Fund with the procedures required by
Investment Company Act Release No. 10666, or any subsequent release or
releases of the Securities and Exchange Commission relating to the maintenance
of segregated accounts by registered investment companies and (iv) for other
proper corporate purposes, but only, in the case of clause (iv), upon receipt
of, in addition to Proper Instructions, a certified copy of a resolution of
the Board of Directors or of the Executive Committee signed by an officer of
the Fund and certified by the Secretary or an Assistant Secretary, setting
forth the purpose or purposes of such segregated account and declaring such
purposes to be proper corporate purposes.

          2.12 Ownership Certificates for Tax Purposes. The Custodian shall
execute ownership and other certificates and affidavits for all federal and
state tax purposes in connection with receipt of income or other payments with
respect to securities of the Fund held by it and in connection with transfers
of securities.

          2.13 Proxies. The Custodian shall, with respect to the securities
held hereunder, cause to be promptly executed by the registered holder of such
securities, if the securities are registered otherwise than in the name of the
Fund or a nominee of the Fund, all proxies, without indication of the manner
in which such proxies are to be voted, and shall promptly deliver to the Fund
such proxies, all proxy soliciting materials and all notices relating to such
securities.

          2.14 Communications Relating to Fund Portfolio Securities. The
Custodian shall transmit promptly to the Fund all written information
(including, without limitation, pendency of calls and maturities of securities
and expirations of rights in connection therewith and notices of exercise of
call and put options written by the Fund and the maturity of futures contracts
purchased or sold by the Fund) received by the Custodian from issuers of the
securities being held for the Fund. With respect to tender or exchange offers,
the Custodian shall transmit promptly to the Fund all written information
received by the Custodian from issuers of the securities whose tender or
exchange is sought and from the party (or his agents) making the tender or
exchange offer. If the Fund desires to take action with respect to any tender
offer, exchange offer or any other similar transaction, the Fund shall notify
the Custodian at least three business days prior to the date on which the
Custodian is to take such action.

          2.15 Proper Instructions. Proper Instructions as used throughout
this Article 2 means a writing signed or initialled by one or more person or
persons as the Board of Directors shall have from time to time authorized.
Each such writing shall set forth the specific transaction



                                      7
<PAGE>

or type of transaction involved, including a specific statement of the purpose
for which such action is requested. Oral instructions will be considered
Proper Instructions if the Custodian reasonably believes them to have been
given by a person authorized to give such instructions with respect to the
transaction involved. The Fund shall cause all oral instructions to be
confirmed in writing. Upon receipt of a certificate of the Secretary or an
Assistant Secretary as to the authorization by the Board of Directors of the
Fund accompanied by a detailed description of procedures approved by the Board
of Directors, Proper Instructions may include communications effected directly
between electro-mechanical or electronic devices provided that the Board of
Directors and the Custodian are satisfied that such procedures afford adequate
safeguards for the Fund's assets.

          2.16 Actions Permitted without Express Authority. The Custodian may
in its discretion, without express authority from the Fund:

          1)   make payments to itself or others for minor expenses of
               handling securities or other similar items relating to its
               duties under this Contract, provided that all such payments
               shall be accounted for to the Fund;

          2)   surrender securities in temporary form for securities in
               definitive form;

          3)   endorse for collection, in the name of the Fund, checks, drafts
               and other negotiable instruments; and

          4)   in general, attend to all non-discretionary details in
               connection with the sale, exchange, substitution, purchase,
               transfer and other dealings with the securities and property of
               the Fund except as otherwise directed by the Board of Directors
               of the Fund.

          2.17 Evidence of Authority. The Custodian shall be protected in
acting upon any instructions, notice, request, consent, certificate or other
instrument or paper believed by it to be genuine and to have been properly
executed by or on behalf of the Fund. The Custodian may receive and accept a
certified copy of a vote of the Board of Directors of the Fund as conclusive
evidence (a) of the authority of any person to act in accordance with such
vote or (b) of any determination or of any action by the Board of Directors
pursuant to the Articles of Incorporation as described in such vote, and such
vote may be considered as in full force and effect until receipt by the
Custodian of written notice to the contrary.

     3. Duties of Custodian with Respect to the Books of Account and
Calculation of Net Asset Value and Net Income.

          The Custodian shall cooperate with and supply necessary information
to the entity or entities appointed by the Board of Directors of the Fund to
keep the books of account of the Fund and/or compute the net asset value per
share of the outstanding shares of the Fund or, if directed in writing to do
so by the Fund, shall itself keep such books of account and/or compute such
net asset value per share. If so directed, the Custodian shall also calculate
weekly the net income of the Fund as described in the Fund's currently
effective prospectus and shall advise the Fund and the Transfer Agent weekly
of the total amounts of such net income and, if instructed in writing by an
officer of the Fund to do so, shall advise the Transfer Agent periodically of
the



                                      8
<PAGE>

division of such net income among its various components. The calculations of
the net asset value per share and the weekly income of the Fund shall be made
at the time or times described from time to time in the Fund's currently
effective prospectus.

     4. Records

          The Custodian shall create and maintain all records relating to its
activities and obligations under this Contract in such manner as will meet the
obligations of the Fund under the Investment Company Act of 1940, with
particular attention to Section 31 thereof and Rules 31a-1 and 31a-2
thereunder, applicable federal and state tax laws and any other law or
administrative rules or procedures which may be applicable to the Fund. All
such records shall be the property of the Fund and shall at all times during
the regular business hours of the Custodian be open for inspection by duly
authorized officers, employees or agents of the Fund and employees and agents
of the Securities and Exchange Commission. The Custodian shall, at the Fund's
request, supply the Fund with a tabulation of securities owned by the Fund and
held by the Custodian and shall, when requested to do so by the Fund and for
such compensation as shall be agreed upon between the Fund and the Custodian,
include certificate numbers in such tabulations.

     5. Opinion of Fund's Independent Accountant

          The Custodian shall take all reasonable action, as the Fund may from
time to time request, to obtain from year to year favorable opinions from the
Fund's independent accountants with respect to its activities hereunder in
connection with the preparation of the Fund's Form N-2, and Form N-SAR or
other reports to the Securities and Exchange Commission and with respect to
any other requirements of such Commission.

     6. Reports to Fund by Independent Public Accountants

          The Custodian shall provide the Fund, at such times as the Fund may
reasonably require, with reports by independent public accountants on the
accounting system, internal accounting control and procedures for safeguarding
securities, futures contracts and options on futures contracts, including
securities deposited and/or maintained in a Securities System, relating to the
services provided by the Custodian under this Contract; such reports shall be
of sufficient scope and in sufficient detail, as may reasonably be required by
the Fund, to provide reasonable assurance that any material inadequacies would
be disclosed by such examination, and, if there are no such inadequacies, the
reports shall so state.

     7. Compensation of Custodian

          The Custodian shall be entitled to reasonable compensation for its
services and expenses as Custodian, as agreed upon from time to time between
the Fund and the Custodian.

     8. Responsibility of Custodian

          So long as and to the extent that it is the exercise of reasonable
care, the Custodian shall not be responsible for the title, validity or
genuineness of any property or evidence of title thereto received by it or
delivered by it pursuant to this Contract and shall be held harmless in acting
upon any notice, request, consent, certificate or other instrument



                                      9
<PAGE>

reasonably believed by it to be genuine and to be signed by the proper party
or parties. The Custodian shall be held to the exercise of reasonable care in
carrying out the provisions of this Contract, but shall be kept indemnified by
and shall be without liability to the Fund for any action taken or omitted by
it in good faith without negligence. It shall be entitled to rely on and may
act upon advice of counsel (who may be counsel for the Fund) on all matters,
and shall be without liability for any action reasonably taken or omitted
pursuant to such advice.

          If the Fund requires the Custodian to take any action with respect
to securities, which action involves the payment of money or which action may,
in the opinion of the Custodian, result in the Custodian or its nominee
assigned to the Fund being liable for the payment of money or incurring
liability of some other form, the Fund, as a prerequisite to requiring the
Custodian to take such action, shall provide indemnity to the Custodian in an
amount and form satisfactory to it.

          If the Fund requires the Custodian to advance cash or securities for
any purpose or in the event that the Custodian or its nominee shall incur or
be assessed any taxes, charges, expenses, assessments, claims or liabilities
in connection with the performance of this Contract, except such as may arise
from its or its nominee's own negligent action, negligent failure to act or
willful misconduct, any property at any time held for the account of the Fund
shall be security therefor and should the Fund fail to repay the Custodian
promptly, the Custodian shall be entitled to utilize available cash and to
dispose of the Fund assets to the extent necessary to obtain reimbursement.

     9. Effective Period, Termination and Amendment

          This Contract shall become effective as of its execution, shall
continue in full force and effect until terminated as hereinafter provided,
may be amended at any time by mutual agreement of the parties hereto and may
be terminated by either party by an instrument in writing delivered or mailed,
postage prepaid to the other party, such termination to take effect not sooner
than sixty (60) days after the date of such delivery or mailing; provided,
however that the Custodian shall not act under Section 2.10 hereof in the
absence of receipt of an initial certificate of the Secretary or an Assistant
Secretary that the Board of Directors of the Fund have approved the initial
use of a particular Securities System and the receipt of an annual certificate
of the Secretary or an Assistant Secretary that the Board of Directors have
reviewed the use by the Fund of such Securities System, as required in each
case by Rule 17f-4 under the Investment Company Act of 1940, as amended;
provided further, however, that the Fund shall not amend or terminate this
Contract in contravention of any applicable federal or state regulations, or
any provision of the Articles of Incorporation, and further provided, that the
Fund may at any time by action of its Board of Directors (i) substitute
another bank or trust company for the Custodian by giving notice as described
above to the Custodian, or (ii) immediately terminate this Contract in the
event of the appointment of a conservator or receiver for the Custodian by the
Comptroller of the Currency or upon the happening of a like event at the
direction of an appropriate regulatory agency or court of competent
jurisdiction.

          Upon termination of the Contract, the Fund shall pay to the
Custodian such compensation as may be due as of the date of such termination
and shall likewise reimburse the Custodian for its costs, expenses and
disbursements.



                                      10
<PAGE>

     10. Successor Custodian

          If a successor custodian shall be appointed by the Board of
Directors of the Fund, the Custodian shall, upon termination, deliver to such
successor custodian at the office of the Custodian, duly endorsed and in the
form for transfer, all securities then held by it hereunder and shall transfer
to an account of the successor custodian all of the Fund's securities held in
a Securities System.

          If no such successor custodian shall be appointed, the Custodian
shall, in like manner, upon receipt of a certified copy of a vote of the Board
of Directors of the Fund, deliver at the office of the Custodian and transfer
such securities, funds and other properties in accordance with such vote.

          In the event that no written order designating a successor custodian
or certified copy of a vote of the Board of Directors shall have been
delivered to the Custodian on or before the date when such termination shall
become effective, then the Custodian shall have the right to deliver to a bank
or trust company, which is a "bank" as defined in the Investment Company Act
of 1940, doing business in Boston, Massachusetts, of its own selection, having
an aggregate capital, surplus, and undivided profits, as shown by its last
published report, of not less than $25,000,000, all securities, funds and
other properties held by the Custodian and all instruments held by the
Custodian relative thereto and all other property held by it under this
Contract and to transfer to an account of such successor custodian all of the
Fund's securities held in any Securities System. Thereafter, such bank or
trust company shall be the successor of the Custodian under this Contract.

          In the event that securities, funds and other properties remain in
the possession of the Custodian after the date of termination hereof owing to
failure of the Fund to procure the certified copy of the vote referred to or
of the Board of Directors to appoint a successor custodian, the Custodian
shall be entitled to fair compensation for its services during such period as
the Custodian retains possession of such securities, funds and other
properties and the provisions of this Contract relating to the duties and
obligations of the Custodian shall remain in full force and effect.

     11. Interpretive and Additional Provisions

          In connection with the operation of this Contract, the Custodian and
the Fund may from time to time agree on such provisions interpretive of or in
addition to the provisions of this Contract as may in their joint opinion be
consistent with the general tenor of this Contract. Any such interpretive or
additional provisions shall be in a writing signed by both parties and shall
be annexed hereto, provided that no such interpretive or additional provisions
shall contravene any applicable federal or state regulations or any provision
of the Articles of Incorporation of the Fund. No interpretive or additional
provisions made as provided in the preceding sentence shall be deemed to be an
amendment of this Contract.

     12. Massachusetts Law to Apply

          This Contract shall be construed and the provisions thereof
interpreted under and in accordance with laws of The Commonwealth of
Massachusetts.



                                      11
<PAGE>

     13. Prior Contracts

          This Contract supersedes and terminates, as of the date hereof, all
prior contracts between the Fund and the Custodian relating to the custody of
the Fund's assets.



                                      12
<PAGE>

          IN WITNESS WHEREOF, each of the parties has caused this instrument
to be executed in its name and behalf by its duly authorized representative
and its seal to be hereunder affixed as of the        day of August, 1986.

ATTEST                                            ROYCE VALUE TRUST, INC.



_________________________                         By  _________________________

ATTEST                                            STATE STREET BANK AND TRUST
                                                  COMPANY


__________________________                        By  _________________________
   Assistant Secretary                                     Vice President



                                      13

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.J2
<SEQUENCE>13
<FILENAME>efc2-1398_exhibitj2.txt
<TEXT>
                                                                Exhibit (j)(2)



                                 AMENDMENT TO
                              CUSTODIAN CONTRACT

          Amendment to Custodian Contract between ROYCE VALUE TRUST, INC., a
corporation organized and existing under the laws of Maryland, having a
principal place of business at 1414 Avenue of the Americas, New York, NY 10019
(hereinafter called the "Fund"), and State Street Bank and Trust Company, a
Massachusetts trust company, having its principal place of business at 225
Franklin Street, Boston, Massachusetts 02110 (hereinafter called the
"Custodian").

          WHEREAS: The Fund and the Custodian are parties to a Custodian
Contract dated October 20, 1986 (the "Custodian Contract");

          WHEREAS: The Fund desires that the Custodian issue a letter of
credit (the "Letter of Credit") on behalf of the Fund for the benefit of ICI
Mutual Insurance Company (the "Company") in accordance with the Continuing
Letter of Credit and Security Agreement and that the Fund's obligations to the
Custodian with respect to the Letter of Credit shall be fully collateralized
at all times while the Letter of Credit is outstanding by, among other things,
segregated assets of the Fund equal to 125% of the face amount of the Letter
of Credit;

          WHEREAS: The Custodian Contract provides for the establishment of
segregated accounts for proper Fund purposes upon Proper Instructions (as
defined in the Custodian Contract); and

          WHEREAS: The Fund and the Custodian desire to establish a segregated
account to hold the collateral for the Fund's obligations to the Custodian
with respect to the Letter of Credit and to amend the Custodian Contract to
provide for the establishment and maintenance thereof;

          WITNESSETH: That in consideration of the mutual covenants and
agreements hereinafter contained, the parties hereto hereby amend the
Custodian Contract as follows:

          1.   Capitalized terms used herein without definition shall have the
               meanings ascribed to them in the Custodian Contract.

          2.   The Fund hereby instructs the Custodian to establish and
               maintain a segregated account (the "Letter of Credit Custody
               Account") for and in behalf of the Fund as contemplated by
               Section 2.11 for the purpose of collateralizing the Fund's
               obligations under this Amendment to the Custodian Contract.

          3.   The Fund shall deposit with the Custodian and the Custodian
               shall hold in the Letter of Credit Custody Account cash, U.S.
               government securities and other high-grade debt securities
               owned by the Fund acceptable to the Custodian (collectively
               "Collateral Securities") equal to 125% of the face amount which
               the Company may draw under the Letter of Credit. Upon receipt
               of such Collateral Securities in the Letter of Credit Custody
               Account, the Custodian shall issue the Letter of Credit to the
               Company.

<PAGE>

          4.   The Fund hereby grants to the Custodian a security interest in
               the Collateral Securities from time to time in the Letter of
               Credit Custody Account (the "Collateral") to secure the
               performance of the Fund's obligations to the Custodian with
               respect to the Letter of Credit, including, without limitation,
               under Section 5-114(3) of the Uniform Commercial Code. The Fund
               shall register the pledge of Collateral and execute and deliver
               to the Custodian such powers and instruments of assignment as
               may be requested by the Custodian to evidence and perfect the
               limited interest in the Collateral granted hereby.

          5.   The Collateral Securities in the Letter of Credit Custody
               Account may be substituted or exchanged (including
               substitutions or exchanges which increase or decrease the
               aggregate value of the Collateral) only pursuant to Proper
               Instructions from the Fund after the Fund notifies the
               Custodian of the contemplated substitution or exchange and the
               Custodian agrees that such substitution or exchange is
               acceptable to the Custodian, and the Custodian shall not
               unreasonably withhold such agreement.

          6.   Upon any payment made pursuant to the Letter of Credit by the
               Custodian to the Company for the account of the Fund, the
               Custodian may withdraw from the Letter of Credit Custody
               Account Collateral Securities in an amount equal in value to
               the amount actually so paid. The Custodian shall have with
               respect to the Collateral so withdrawn all of the rights of a
               secured creditor under the Uniform Commercial Code as adopted
               in the Common-wealth of Massachusetts at the time of such
               with-drawal and all other rights granted or permitted to it
               under law.

          7.   The Custodian will transfer upon receipt all income earned on
               the Collateral to the Fund custody account unless the Custodian
               receives Proper Instructions from the Fund to the contrary.

          8.   Upon the drawing by the company of all amounts which may become
               payable to it under the Letter of Credit for the account of the
               Fund and the withdrawal of all Collateral Securities with
               respect thereto by the Custodian pursuant to Section 6 hereof,
               or upon the termination of that portion of the Letter of Credit
               issued for its account by the Fund with the written consent of
               the Company, the Custodian shall transfer any Collateral
               Securities then remaining in the Letter of Credit Custody
               Account to another Fund custody account.

          9.   Collateral held in the Letter of Credit Custody Account shall
               be released only in accordance with the provisions of this
               Amendment to Custodian Contract. The Collateral shall at all
               times until withdrawn pursuant to Section 6 hereof remain the
               property of the Fund, subject only to the extent of the
               interest granted herein to the Custodian.



                                      2
<PAGE>

          10.  Notwithstanding any other termination of the Custodian
               Contract, the, Custodian Contract shall remain in full force
               and effect with respect to the Letter of Credit Custody Account
               until transfer of all Collateral securities pursuant to Section
               8 hereof.

          11.  The Custodian shall be entitled to reasonable compensation for
               its issuance of the Letter of Credit and for its services in
               connection with the Letter of Credit Custody Account as agreed
               upon from time to time between the Fund and the Custodian.

          12.  The Custodian Contract as amended hereby, shall be governed by,
               and construed and interpreted under, the laws of the
               Commonwealth of Massachusetts.

          13.  The parties agree to execute and deliver all such further
               documents and instruments and to take such further action as
               may be required to carry out the purposes of the Custodian
               Contract, as amended hereby.

          14.  Except as provided in this Amendment to Custody Contract, the
               Custodian Contract shall remain in full force and effect,
               without amendment or modification, and all applicable
               provisions of the Custodian Contract, as amended hereby,
               including, without limitation, Section 8 thereof, shall govern
               the Letter of Credit Custody Account and the rights and
               obligations of the Fund and the Custodian under this Amendment
               to Custodian Contract. No provision of this Amendment to
               Custodian Contract shall be deemed to constitute a waiver of
               any rights of the Custodian under the Custodian Contract or
               under law.

          IN WITNESS WHEREOF, each of the parties has caused this Amendment
to Custodian Contract to be executed in its name and behalf by its duly
authorized representatives and its seal to be hereunder affixed as of the ____
day of December, 1987.

ATTEST:                                   ROYCE VALUE TRUST, INC.



By:  _________________________            By   _________________________
                                               Charles M. Royce, President

ATTEST:                                   STATE STREET BANK AND TRUST COMPANY



By:   __________________________          By   _________________________
      Assistant Secretary                      Vice President



                                      3

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.J3
<SEQUENCE>14
<FILENAME>efc2-1398_exhibitj3.txt
<TEXT>
                                                                Exhibit (j)(3)




                               AMENDMENT TO THE
                              CUSTODIAN CONTRACT

          AGREEMENT made this      day of          1988 by and between STATE
STREET BANK AND TRUST COMPANY ("Custodian") and ROYCE VALUE TRUST, INC.
(the "Fund").

                               WITNESSETH THAT:

          WHEREAS, the Custodian and the Fund are parties to a Custodian
Contract dated October 20, 1986 (as amended to date, the "Contract") which
governs the terms and conditions under which the Custodian maintains custody
of the securities and other assets of the Fund:

          NOW THEREFORE, the Custodian and the Fund hereby amend the terms of
the Custodian Contract and mutually agree to the following:

          Replace subsection 7) of Section 2.2 Delivery of Securities with the
following new subsection 7):

          7) Upon the sale of such securities for the account of the Fund, to
          the broker or its clearing agent, against a receipt, for examination
          in accordance with "street delivery" custom; provided that in any
          such case, the Custodian shall have no responsibility or liability
          for any loss arising from the delivery of such securities prior to
          receiving payment for such securities except as may arise from the
          Custodian's own negligence or willful misconduct;

          IN WITNESS WHEREOF, each of the parties has caused this Amendment to
be executed in its name and on its behalf by a duly authorized officer as of
the day and year first above written.

ATTEST                                   ROYCE VALUE TRUST, INC.



- -------------------------                -------------------------
ATTEST                                   STATE STREET BANK AND TRUST COMPANY



__________________________               By   _________________________
Assistant Secretary                           Vice President


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.J4
<SEQUENCE>15
<FILENAME>efc2-1398_exhibitj4.txt
<TEXT>
                                                                Exhibit (j)(4)



                      AMENDMENT TO THE CUSTODIAN CONTRACT

          AGREEMENT made by and between State Street Bank and Trust Company
(the "Custodian") and Royce Value Trust, Inc. (the "Fund").

          WHEREAS, the Custodian and the Fund are parties to a custodian
contract dated October 20, 1986 (the "Custodian Contract") governing the terms
and conditions under which the Custodian maintains custody of the securities
and other assets of the Fund; and

          WHEREAS, the Custodian and the Fund desire to amend the Custodian
Contract to provide for the maintenance of the Fund's foreign securities, and
cash incidental to transactions in such securities, in the custody of certain
foreign banking institutions and foreign securities depositories acting as
sub-custodians in conformity with the requirements of Rule 17f-5 under the
Investment Company Act of 1940;

          NOW THEREFORE, in consideration of the premises and covenants
contained herein, the Custodian and the Fund hereby amend the Custodian
Contract by the addition of the following terms and conditions;

     1. Appointment of Foreign Sub-Custodians

          The Fund hereby authorizes and instructs the Custodian to employ as
sub-custodians for the Fund's securities and other assets maintained outside
the United States the foreign banking institutions and foreign securities
depositories designated on Schedule A hereto ("foreign sub-custodians"). Upon
receipt of "Proper Instructions", as defined in Section 2.15 of the Custodian
Contract, together with a certified resolution of the Fund's Board of
Directors, the Custodian and the Fund may agree to amend Schedule A hereto
from time to time to designate additional foreign banking institutions and
foreign securities depositories to act as sub-custodian. Upon receipt of
Proper Instructions, the Fund may instruct the Custodian to (and the Custodian
shall) cease the employment of any one or more of such sub-custodians for
maintaining custody of the Fund's assets.

     2. Assets to be Held

          The Custodian shall limit the securities and other assets maintained
in the custody of the foreign sub-custodians to: (a) "foreign securities", as
defined in paragraph (c)(1) of Rule 17f-5 under the Investment Company Act of
1940, and (b) cash and cash equivalents in such amounts as the Custodian or
the Fund may determine to be reasonably necessary to effect the Fund's foreign
securities transactions.

     3. Foreign Securities Depositories

          Except as may otherwise be agreed upon in writing by the Custodian
and the Fund, assets of the Fund shall be maintained in foreign securities
depositories only through arrangements implemented by the foreign banking
institutions serving as sub-custodians pursuant to the terms hereof. Where
possible, such arrangements shall include entry into agreements containing the
provisions set forth in Section 5 hereof.

<PAGE>

     4. Segregation of Securities

          The Custodian shall identify on its books as belonging to the Fund,
the foreign securities of the Fund held by each foreign sub-custodian. Each
agreement pursuant to which the Custodian employs a foreign banking
institution shall require that such institution establish a separate custody
account for the Custodian on behalf of the Fund and physically segregate in
that account, securities and other assets of the Fund, and, in the event that
such institution deposits the Fund's securities in a foreign securities
depository, that it shall identify on its books as belonging to the Custodian,
as agent for the Fund, the securities so deposited.

     5. Agreements with Foreign Banking Institutions

          Each agreement with a foreign banking institution shall be
substantially in the form set forth in Exhibit 1 hereto and shall provide
that: (a) the Fund's assets will not be subject to any right, charge, security
interest, lien or claim of any kind in favor of the foreign banking
institution or its creditors or agents, except a claim of payment for their
safe custody or administration; (b) beneficial ownership for the Fund's assets
will be freely transferable without the payment of money or value other than
for custody or administration; (c) adequate records will be maintained
identifying the assets as belonging to the Fund; (d) officers of or auditors
employed by, or other representatives of the Custodian, including to the
extent permitted under applicable law the independent public accountants for
the Fund, will be given access to the books and records of the foreign banking
institution relating to its actions under its agreement with the Custodian;
and (e) assets of the Fund held by the foreign sub-custodian will be subject
only to the instructions of the Custodian or its agents.

     6. Access of Independent Accountants of the Fund

          Upon request of the Fund, the Custodian will use its best efforts to
arrange for the independent accountants of the Fund to be afforded access to
the books and records of any foreign banking institution employed as a foreign
sub-custodian insofar as such books and records relate to the performance of
such foreign banking institution under its agreement with the Custodian.

     7. Reports by Custodian

          The Custodian will supply to the Fund from time to time, as mutually
agreed upon but not less frequently than [quarterly], statements in respect of
the securities and other assets of the Fund held by foreign sub-custodians,
including but not limited to an identification of entities having possession
of the Fund's securities and other assets and advices or notifications of any
transfers of securities to or from each custodial account maintained by a
foreign banking institution for the Custodian on behalf of the Fund
indicating, as to securities acquired for the Fund, the identity of the entity
having physical possession of such securities.

     8. Transactions in Foreign Custody Account

          (a) Except as otherwise provided in paragraph (b) of this Section 8,
the provisions of Sections 2.2 and 2.7 of the Custodian Contract shall apply,
mutatis mutandis to the foreign securities of the Fund held outside the United
States by foreign sub-custodians.



                                      2
<PAGE>

          (b) Notwithstanding any provision of the Custodian Contract to the
contrary, settlement and payment for foreign securities received for the
account of the Fund and delivery of securities maintained for the account of
the Fund may be effected by the Custodian outside of the United States or the
foreign sub-custodian in accordance with the customary established securities
trading or securities processing practices and procedures in the foreign
jurisdiction or market in which the transaction occurs, including, without
limitation, delivering securities to the purchaser thereof or to a dealer
therefor (or an agent for such purchaser or dealer) against a receipt with the
expectation of receiving later payment for such securities from such purchaser
or dealer.

          (c) Securities maintained in the custody of a foreign sub-custodian
may be maintained in the name of such entity's nominee to the same extent as
set forth in Section 2.3 of the Custodian Contract, and the Fund agrees to
hold any such nominee harmless from any liability as a holder of record of
such securities.

     9. Liability of Foreign Sub-Custodians

          Each agreement pursuant to which the Custodian employs a foreign
banking institution as a foreign sub-custodian shall require the institution
to exercise reasonable care in the performance of its duties and to indemnify,
and hold harmless, the Custodian and the Fund from and against any loss,
damage, cost, expense, liability or claim arising out of or in connection with
the institution's performance of such obligations. At the election of the
Fund, it shall be entitled to be subrogated to the rights of the Custodian
with respect to any claims against a foreign banking institution as a
consequence of any such loss, damage, cost, expense, liability or claim if and
to the extent that the Fund has not been made whole for any such loss, damage,
cost, expense, liability or claim.

     10. Liability of Custodian

          The Custodian shall be liable for the acts or omissions of a foreign
banking institution to the same extent as set forth with respect to
sub-custodians generally in the Custodian Contract and, regardless of whether
assets are maintained in the custody of a foreign banking institution, a
foreign securities depository or a branch of a U.S. bank as contemplated by
paragraph 13 hereof, the Custodian shall not be liable for any loss, damage,
cost, expense, liability or claim resulting from nationalization,
expropriation, currency restrictions, or acts of war or terrorism or any loss
where the sub-custodian has otherwise exercised reasonable care.
Notwithstanding the foregoing provisions of this paragraph 10, in delegating
custody duties to State Street London Ltd. or to any other affiliate of the
Custodian, the Custodian shall not be relieved of any responsibility to the
Fund for any loss, damage, cost, expense, liability or claim due to such
delegation, except such loss, damage, cost, expense, liability or claim as may
result from (a) political risk (including, but not limited to, exchange
control restrictions, confiscation, expropriation, nationalization,
insurrection, civil strife or armed hostilities) or (b) other losses
(excluding a bankruptcy or insolvency of State Street London Ltd. or any such
other affiliate not caused by political risk) due to Acts of God, nuclear
incident or other losses under circumstances where the Custodian and State
Street London Ltd. or any such other affiliate have exercised reasonable care.



                                      3
<PAGE>

     11. Reimbursement for Advances

          If the Fund requires the Custodian to advance cash or securities for
any purpose including the purchase or sale of foreign exchange or of contracts
for foreign exchange, or in the event that the Custodian or its nominee shall
incur or be assessed any taxes, charges, expenses, assessments, claims or
liabilities in connection with the performance of this Contract, except such
as may arise from its or its nominee's own negligent action, negligent failure
to act or willful misconduct, any property at any time held for the account of
the Fund shall be security therefor and should the Fund fail to repay the
Custodian promptly, the Custodian shall be entitled to utilize available cash
and to dispose of the Fund assets to the extent necessary to obtain
reimbursement.

     12. Monitoring Responsibilities

          The Custodian shall furnish annually to the Fund, during the month
of June, information concerning the foreign sub-custodians employed by the
Custodian. Such information shall be similar in kind and scope to that
furnished to the Fund in connection with the initial approval of this
amendment to the Custodian Contract. In addition, the Custodian will promptly
inform the Fund in the event that the Custodian learns of a material adverse
change in the financial condition of a foreign sub-custodian or any loss of
the assets of the Fund or in the case of any foreign sub-custodian not the
subject of an exemptive order from the Securities and Exchange Commission is
notified by such foreign sub-custodian that there appears to be a substantial
likelihood that its shareholders' equity will decline below $200 million (U.S.
dollars or the equivalent thereof) or that its shareholders' equity has
declined below $200 million (in each case computed in accordance with
generally accepted U.S. accounting principles).

     13. Branches of U.S. Banks

          (a) Except as otherwise set forth in this amendment to the Custodian
Contract, the provisions hereof shall not apply where the custody of the Fund
assets is maintained in a foreign branch of a banking institution which is a
"bank" as defined by Section 2(a)(5) of the Investment Company Act of 1940
meeting the qualification set forth in Section 26(a) of said Act. The
appointment of any such branch as a sub-custodian shall be governed by
paragraph 1 of the Custodian Contract.

          (b) Cash held for the Fund in the United Kingdom shall be maintained
in an interest bearing account established for the Fund with the Custodian's
London Branch, which account shall be subject to the direction of the
Custodian, State Street London Ltd. or both.

     14. Applicability of Custodian Contract

          Except as specifically superseded or modified herein, the terms and
provisions of the Custodian Contract shall continue to apply with full force
and effect.



                                      4
<PAGE>

          IN WITNESS WHEREOF, each of the parties has caused this instrument
to be executed in its name and behalf by its duly authorized representative
and its seal to be hereunder affixed as of the 2nd day of April, 1992.

ATTEST                                  ROYCE VALUE TRUST, INC.



_________________________               By   _________________________
(Title)                                      (Title)

ATTEST                                  STATE STREET BANK AND TRUST COMPANY



__________________________              By   _________________________
Assistant Secretary                          Vice President



                                      5
<PAGE>

                                  Schedule A
                                  ----------

          The following foreign banking institutions and foreign securities
depositories have been approved by the Board of Directors of Royce Value
Trust, Inc. for use as sub-custodians for the Fund's securities and other
assets.

                  (insert banks and securities depositories)

          State Street London Limited















Certified:


- --------------------
Fund's Authorized Officer

Dated:  ______________



                                      6
<PAGE>

                                   EXHIBIT I
                                   ---------

                              CUSTODIAN AGREEMENT
                              -------------------

TO:


Gentlemen:

          The undersigned ("State Street") hereby requests that you ( the
"Bank") establish a custody account and a cash account for each State Street
client whose account is identified to this Agreement. Each such custody or
cash account as applicable will be referred to herein as the "Account" and
will be subject to the following terms and conditions:

          1. The Bank shall hold as agent for State Street and shall
physically segregate in the Account such cash, bullion, coin, stocks, shares,
bonds, debentures, notes and other securities and other property which is
delivered to the Bank for that State Street Account (the "Property").

          2. (a) Without the prior approval of State Street it will not
deposit securities in any securities depository or utilize a clearing agency,
incorporated or organized under the laws of a country other than the United
States, unless such depository or clearing house operates the central system
for handling of securities or equivalent book-entries in that country or
operates a transnational system for the central handling of securities or
equivalent book-entries.

          (b) When Securities held for an Account are deposited in a
securities depository or clearing agency by the Bank, the Bank shall identify
on its books as belonging to State Street as agent for such Account, the
Securities so deposited.

     The Bank represents that either:

          3. (a) currently has stockholders' equity in excess of $200 million
(US dollars or the equivalent of US dollars computed in accordance with
generally accepted US accounting principles) and will promptly inform State
Street in the event that there appears to be a substantial likelihood that its
stockholders' equity will decline below $200 million, or in any evens, at such
time as its stockholders' equity in fact declines below $200 million; or

          (b) It is the subject of an exemptive order issued by the United
States Securities and Exchange Commission, which such order permits State
Street to employ the Bank as a subcustodian, notwithstanding the fact that the
Bank's stockholders' equity is currently below $200 million or may in the
future decline below $200 million due to currency fluctuation.

          4. Upon the written instructions of State Street as permitted by
Section 8 , the Bank is authorised to pay out cash from the Account and to
sell, assign,. transfer, deliver or exchange, or to purchase for the Account,
any and all stocks, shares, bonds, debentures, notes and other securities
("Securities"), bullion, coin and other property, but only as provided in such
written instructions. The Bank shall not be held liable. for any act or
omission to act on instructions given or purported to be given should there be
any error in such instructions.

<PAGE>

          5. Unless the Bank receives written instructions of State Street to
the contrary, the Bank is authorized:

     a.   To promptly receive and collect all income and principal with
          respect to the Property and to credit cash receipts to the Account;

     b.   To promptly exchange Securities where the exchange is purely
          ministerial (including, without limitation, the exchange of
          temporary Securities for those in definitive form and the exchange
          of warrants, or other documents of entitlement to Securities, for
          the Securities themselves);

     c.   To promptly surrender Securities at maturity or when called for
          redemption upon receiving payment therefor;

     d.   Whenever notification of a rights entitlement or a fractional
          interest resulting from a rights issue, stock dividend or stock
          split is received for the Account and such rights entitlement or
          fractional interest bears an expiration date, the Bank will endeavor
          to obtain State Street's instructions, but should these not be
          received in time for the Bank to take timely action, the Bank is
          authorized to sell such rights entitlement or fractional interest
          and to credit the Account;

     e.   To hold registered in the name of the nominee of the Bank or its
          agents such Securities as are ordinarily held in registered form;

     f.   To execute in State Street's name for the Account, whenever the Bank
          deems ii appropriate, such ownership and other certificates as may
          be required to obtain the payment of income from the Property; and

     g.   To pay or cause to be paid from the Account any and all taxes and
          levies in the nature of taxes imposed on such assets by any
          governmental authority, and shall use reasonable efforts to promptly
          reclaim any foreign withholding tax relating to the Account.

          6. If the Bank shall receive any proxies, notices, reports, or other
communications relative to any of the Securities of the Account in connection
with tender offers, reorganizations, mergers, consolidations, or similar
events which may have an impact upon the issuer thereof, the Bank shall
promptly transmit any such communication to State Street by means as will
permit State Street to take timely action with respect thereto.

          7. The Bank is authorized in its discretion to appoint brokers and
agents in connection with the Bank's handling of transactions relating to the
Property provided that any such appointment shall not relieve the Bank of any
of its responsibilities or liabilities hereunder.

          8. Written instructions shall include (i) instructions in writing
signed by such persons as are designated in writing by State Street (ii) telex
or tested telex instructions of State Street, (iii) other forms of instruction
in computer readable form as shall be customarily utilized for the
transmission of like information and (iv) such other forms of communication as
from time to time shall be agreed upon by State Street and the Bank.



                                      2
<PAGE>

          9. The Bank shall supply periodic reports with respect to the
safekeeping of assets held by it under this Agreement. The content of such
reports shall include but not be limited to any transfer to or from any
Account held by the Bank hereunder and such other information as State Street
may reasonably request.

          10. In addition to its obligations under Section 2 hereof, the Bank
shall maintain such other records as may be necessary to identify the assets
hereunder as belonging to each State Street client identified to this
Agreement from time to time.

          11. The Bank agrees that its books and records relating to its
actions under this Agreement shall be opened to the physical, on-premises
inspection and audit at reasonable times by officers of, auditors employed by
or other representatives of State Street (including to the extent permitted
under _____________ law the independent public accountants for any entity
whose Property is being held hereunder) and shall be retained for such period
as shall be agreed by State Street and the Bank.

          12. The Bank shall be entitled to reasonable compensation for its
services and expenses as custodian under this Agreement, as agreed upon from
time to time by the Bank and State Street.

          13. The Bank shall exercise reasonable care In the performance of
its duties as are set forth or contemplated herein or contained In
instructions given to the Bank which are not contrary to this Agreement, and
shall maintain adequate insurance and agrees to indemnify and hold State
Street and each Account from and against any loss, damage, cost, expense,
liability or claim arising out of or in connection with the Bank's performance
of its obligations hereunder.

          14. The Bank agrees that (i) the Property is not subject to any
right, charge, security interest, lien or claim of any kind in favor of the
Bank or any of its agents or its creditors except a claim of payment for their
safe custody and administration and (ii) the beneficial ownership of the
Property shall be freely transferable without the payment of money or other
value other than for safe custody or administration.

          15. This Agreement may be terminated by the Bank or State Street by
at least 60 days' written notice to the other, sent by registered mail or
express courier. The Bank, upon the date this Agreement terminates pursuant to
notice which has been given in a timely fashion, shall deliver the Property in
accordance with written instructions of State Street specifying the names) of
the person(s) to whom the Property shall be delivered.

          16. The Bank and State Street shall each use its best efforts to
maintain the confidentiality of the Property in each Account, subject,
however, to the provisions of any laws requiring the disclosure of the
Property.

          17. The Bank agrees to follow such Operating Requirements as State
Street may require from time to time. A copy of the current State Street
Operating Requirements is attached as an exhibit to this Agreement.

          18. Unless otherwise specified in this Agreement, all notices with
respect to matters contemplated by this Agreement shall be deemed duly given
when received in writing or



                                      3
<PAGE>

by tested telex by the Bank or State Street at their respective addresses set
forth below, or at such other address as specified in each case in a notice
similarly given:

     To State Street:                         Global Custody Services Division
                                              STATE STREET BANK AND TRUST
                                                COMPANY
                                              P. O. Box 470
                                              Boston, Massachusetts  02102
     To the Bank:







          19. This Agreement shall be governed by and construed in accordance
with the laws of ________________.

          Please acknowledge your agreement to the foregoing by executing a
copy of this letter.

                                                Very truly yours,

                                                STATE STREET BANK AND TRUST
                                                   COMPANY



                                                BY________________________

Agreed to by




By_____________________

Date____________________



                                      4

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.J5
<SEQUENCE>16
<FILENAME>efc2-1398_exhibitj5.txt
<TEXT>
                                                                 Exhibit(j)(5)


                        AMENDMENT TO CUSTODIAN CONTRACT

      This Amendment to the Custodian Contract is made as of November 3, 1997
by and between Royce Value Trust, Inc. (the "Fund") and State Street Bank and
Trust Company (the "Custodian"). Capitalized terms used in this Amendment
without definition shall have the respective meanings given to such terms in
the Custodian Contract referred to below.

      WHEREAS, the Fund and the Custodian entered into a Custodian Contract
dated as of October 20, 1986 (as amended and in effect from time to time, the
"Contract"); and

      WHEREAS, the Fund and the Custodian desire to amend certain provisions
of the Contract to reflect revisions to Rule 17f-5 ("Rule 17f-5") promulgated
under the Investment Company Act of 1940, as amended; and

      WHEREAS, the Fund and the Custodian desire to amend and restate certain
other provisions of the Contract relating to the custody of assets of the Fund
held outside of the United States.

      NOW THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements hereinafter contained, the parties hereby agree to
amend the Contract, pursuant to the terms thereof, as follows:

I.    The amendment to the Contract dated April 2, 1992 relating to
      custody of the Fund's foreign securities is hereby deleted, and the
      parties hereto agree that it shall be and is replaced in its entirety by
      the provisions set forth below.

3.    The Custodian as Foreign Custody Manager.
      ----------------------------------------

3.1.  Definitions.
      -----------

Capitalized terms in this Article 3 shall have the following meanings:

"Country Risk" means all factors reasonably related to the systemic risk of
holding Foreign Assets in a particular country including, but not limited to,
such country's political environment; economic and financial infrastructure
(including financial institutions such as any Mandatory Securities
Depositories operating in the country); prevailing or developing custody and
settlement practices; and laws and regulations applicable to the safekeeping
and recovery of Foreign Assets held in custody in that country.

"Eligible Foreign Custodian" has the meaning set forth in section (a)(1) of
Rule 17f-5, except that the term does not include Mandatory Securities
Depositories.

"Foreign Assets" means any of the Fund's investments (including foreign
currencies) for which the primary market is outside the United States and such
cash and cash equivalents as are reasonably necessary to effect the Fund's
transactions in such investments.

"Foreign Custody Manager" has the meaning set forth in section (a)(2) of Rule
17f-5.


<PAGE>


"Mandatory Securities Depository" means a foreign securities depository or
clearing agency that, either as a legal or practical matter, must be used if
the Fund determines to place Foreign Assets in a country outside the United
States (i) because required by law or regulation; (ii) because securities
cannot be withdrawn from such foreign securities depository or clearing
agency; or (iii) because maintaining or effecting trades in securities outside
the foreign securities depository or clearing agency is not consistent with
prevailing or developing custodial or market practices.

3.2. Delegation to the Custodian as Foreign Custody Manager.
     ------------------------------------------------------

The Fund, by resolution adopted by its Board of Directors (the "Board"),
hereby delegates to the Custodian, subject to Section (b) of Rule 17f-5, the
responsibilities set forth in this Article 3 with respect to Foreign Assets
held outside the United States, and the Custodian hereby accepts such
delegation, as Foreign Custody Manager of the Fund.

3.3.  Countries Covered.
      -----------------

The Foreign Custody Manager shall be responsible for performing the delegated
responsibilities defined below only with respect to the countries and custody
arrangements for each such country listed on Schedule A to this Contract,
which may be amended from time to time by the Foreign Custody Manager. The
Foreign Custody Manager shall list on Schedule A the Eligible Foreign
Custodians selected by the Foreign Custody Manager to maintain the Fund's
assets. Mandatory Securities Depositories are listed on Schedule B to this
Contract, which Schedule B may be amended from time to time by the Foreign
Custody Manager. The Foreign Custody Manager will provide amended versions of
Schedules A and B in accordance with Section 3.7 of this Article 3.

Upon the receipt by the Foreign Custody Manager of Proper Instructions to open
an account, or to place or maintain Foreign Assets, in a country listed on
Schedule A, and the fulfillment by the Fund of the applicable account opening
requirements for such country, the Foreign Custody Manager shall be deemed to
have been delegated by the Board responsibility as Foreign Custody Manager
with respect to that country and to have accepted such delegation. Following
the receipt of Proper Instructions directing the Foreign Custody Manager to
close the account of the Fund with the Eligible Foreign Custodian selected by
the Foreign Custody Manager in a designated country, the delegation by the
Board to the Custodian as Foreign Custody Manager for that country shall be
deemed to have been withdrawn and the Custodian shall immediately cease to be
the Foreign Custody Manager of the Fund with respect to that country.

The Foreign Custody Manager may withdraw its acceptance of delegated
responsibilities with respect to a designated country upon written notice to
the Fund. Thirty days (or such longer period as to which the parties agree in
writing) after receipt of any such notice by the Fund, the Custodian shall
have no further responsibility as Foreign Custody Manager to the Fund with
respect to the country as to which the Custodian's acceptance of delegation is
withdrawn.



                                      2
<PAGE>

3.4.  Scope of Delegated Responsibilities.
      -----------------------------------

3.4.1.   Selection of Eligible Foreign Custodians.
         ----------------------------------------

Subject to the provisions of this Article 3, the Foreign Custody Manager may
place and maintain the Foreign Assets in the care of the Eligible Foreign
Custodian selected by the Foreign Custody Manager in each country listed on
Schedule A, as amended from time to time.

In performing its delegated responsibilities as Foreign Custody Manager to
place or maintain Foreign Assets with an Eligible Foreign Custodian, the
Foreign Custody Manager shall determine that the Foreign Assets will be
subject to reasonable care, based on the standards applicable to custodians in
the country in which the Foreign Assets will be held by that Eligible Foreign
Custodian, after considering all factors relevant to the safekeeping of such
assets, including, without limitation:

      (i)   the Eligible Foreign Custodian's practices, procedures, and
            internal controls, including, but not limited to, the physical
            protections available for certificated securities (if applicable),
            its methods of keeping custodial records, and its security and
            data protection practices;

      (ii)  whether the Eligible Foreign Custodian has the financial strength
            to provide reasonable care for Foreign Assets;

      (iii) the Eligible Foreign Custodian's general reputation and standing
            and, in the case of a foreign securities depository or clearing
            agency which is not a Mandatory Securities Depository, the foreign
            securities depository's or clearing agency's operating history and
            the number of participants in the foreign securities depository or
            clearing agency; and

      (iv)  whether the Fund will have jurisdiction over and be able to
            enforce judgments against the Eligible Foreign Custodian, such as
            by virtue of the existence of any offices of the Eligible Foreign
            Custodian in the United States or the Eligible Foreign Custodian's
            consent to service of process in the United States.

3.4.2.   Contracts With Eligible Foreign Custodians.
         ------------------------------------------

The Foreign Custody Manager shall determine that the contract (or the rules or
established practices or procedures in the case of an Eligible Foreign
Custodian that is a foreign securities depository or clearing agency)
governing the foreign custody arrangements with each Eligible Foreign
Custodian selected by the Foreign Custody Manager will provide reasonable care
for the Foreign Assets held by that Eligible Foreign Custodian based on the
standards applicable to custodians in the particular country. Each such
contract shall include provisions that provide:

      (i)   for indemnification or insurance arrangements (or any combination
            of the foregoing) such that the Fund will be adequately protected
            against the risk of loss of the Foreign Assets held in accordance
            with such contract;



                                      3
<PAGE>

      (ii)  that the Foreign Assets will not be subject to any right, security
            interest, or lien or claim of any kind in favor of the Eligible
            Foreign Custodian or its creditors except a claim of payment for
            their safe custody or administration or, in the case of cash
            deposits, liens or rights in favor of creditors of the Eligible
            Foreign Custodian arising under bankruptcy, insolvency, or similar
            laws;

      (iii) that beneficial ownership of the Foreign Assets will be freely
            transferable without the payment of money or value other than for
            safe custody or administration;

      (iv)  that adequate records will be maintained identifying the Foreign
            Assets as belonging to the Fund or as being held by a third party
            for the benefit of the Fund;

      (v)   that the Fund's independent public accountants will be given
            access to those records or confirmation of the contents of those
            records; and

      (vi)  that the Fund will receive periodic reports with respect to the
            safekeeping of the Foreign Assets, including, but not limited to,
            notification of any transfer of the Foreign Assets to or from the
            Fund's account or a third party account containing the Foreign
            Assets held for the benefit of the Fund,

or, in lieu of any or all of the provisions set forth in (i) through (vi)
above, such other provisions that the Foreign Custody Manager determines will
provide, in their entirety, the same or greater level of care and protection
for the Foreign Assets as the provisions set forth in (i) through (vi) above
in their entirety.

3.4.3.   Monitoring.
         ----------

In each case in which the Foreign Custody Manager maintains Foreign Assets
with an Eligible Foreign Custodian selected by the Foreign Custody Manager,
the Foreign Custody Manager shall establish a system to monitor (i) the
appropriateness of maintaining the Foreign Assets with such Eligible Foreign
Custodian and (ii) the contract governing the custody arrangements established
by the Foreign Custody Manager with the Eligible Foreign Custodian. In the
event the Foreign Custody Manager determines that the custody arrangements
with an Eligible Foreign Custodian it has selected are no longer appropriate,
the Foreign Custody Manager shall notify the Board in accordance with Section
3.7 hereunder.

3.5.  Guidelines for the Exercise of Delegated Authority.
      --------------------------------------------------

For purposes of this Article 3, the Board shall be deemed to have considered
and determined to accept such Country Risk as is incurred by placing and
maintaining the Foreign Assets in each country for which the Custodian is
serving as Foreign Custody Manager of the Fund, and the Board shall be deemed
to be monitoring on a continuing basis such Country Risk to the extent that
the Board considers necessary or appropriate. The Fund and the Custodian each
expressly acknowledge that the Foreign Custody Manager shall not be delegated
any responsibilities under this Article 3 with respect to Mandatory Securities
Depositories.



                                      4
<PAGE>

3.6.  Standard of Care as Foreign Custody Manager of the Fund.
      -------------------------------------------------------

In performing the responsibilities delegated to it, the Foreign Custody
Manager agrees to exercise reasonable care, prudence and diligence such as a
person having responsibility for the safekeeping of assets of management
investment companies registered under the Investment Company Act of 1940, as
amended, would exercise.

3.7.  Reporting Requirements.
      ----------------------

The Foreign Custody Manager shall report the withdrawal of the Foreign Assets
from an Eligible Foreign Custodian and the placement of such Foreign Assets
with another Eligible Foreign Custodian by providing to the Board amended
Schedules A or B at the end of the calendar quarter in which an amendment to
either Schedule has occurred. The Foreign Custody Manager shall make written
reports notifying the Board of any other material change in the foreign
custody arrangements of the Fund described in this Article 3 after the
occurrence of the material change.

3.8.  Representations with Reject to Rule 17f-5.
      -----------------------------------------

The Foreign Custody Manager represents to the Fund that it is a U.S. Bank as
defined in section (a)(7) of Rule 17f-5.

The Fund represents to the Custodian that the Board has determined that it is
reasonable for the Board to rely on the Custodian to perform the
responsibilities delegated pursuant to this Contract to the Custodian as the
Foreign Custody Manager of the Fund.

3.9.  Effective Date and Termination of the Custodian as Foreign Custody
      ------------------------------------------------------------------
      Manager.
      -------

The Board's delegation to the Custodian as Foreign Custody Manager of the Fund
shall be effective as of the date of execution of this Amendment and shall
remain in effect until terminated at any time, without penalty, by written
notice from the terminating party to the non-terminating party. Termination
will become effective thirty days after receipt by the non-terminating party
of such notice. The provisions of Section 3.3 of this Article 3 shall govern
the delegation to and termination of the Custodian as Foreign Custody Manager
of the Fund with respect to designated countries.

4.    Duties of the Custodian with Respect to Property of the Fund Held
      -----------------------------------------------------------------
      Outside the United States.
      -------------------------

4.1.  Definitions.
      -----------

Capitalized terms in this Article 4 shall have the following meanings:

"Foreign Securities System" means either a clearing agency or a securities
depository listed on Schedule A hereto or a Mandatory Securities Depository
listed on Schedule B hereto.

"Foreign Sub-Custodian" means a foreign banking institution serving as an
Eligible Foreign Custodian or a Permissible Foreign Custodian.



                                      5
<PAGE>

"Permissible Foreign Custodian" means any person with whom property of the
Fund may be placed and maintained outside of the United States under (i)
section 17(f) or 26(a) of the Investment Company Act of 1940, as amended,
without regard to Rule 17f-5 or (ii) an order of the U.S. Securities and
Exchange Commission.

4.2.  Holding Securities.
      ------------------

The Custodian shall identify on its books as belonging to the Fund the foreign
securities held by each Foreign Sub-Custodian or Foreign Securities System.
The Custodian may hold foreign securities for all of its customers, including
the Fund, with any Foreign Sub-Custodian in an account that is identified as
belonging to the Custodian for the benefit of its customers, provided however,
that (i) the records of the Custodian with respect to foreign securities of
the Fund which are maintained in such account shall identify those securities
as belonging to the Fund and (ii) the Custodian shall require that securities
so held by the Foreign Sub-Custodian be held separately from any assets of
such Foreign Sub-Custodian or of other customers of such Foreign
Sub-Custodian.

4.3.  Foreign Securities Systems.
      --------------------------

Foreign securities shall be maintained in a Foreign Securities System in a
designated country only through arrangements implemented by the Foreign
Sub-Custodian in such country pursuant to the terms of this Contract.

4.4.  Holding of Foreign Assets With Permissible Foreign Custodians.
      -------------------------------------------------------------

Subject to the requirements of Sections 17(f) and 26(a) of the Investment
Company Act of 1940, as amended (and any other applicable law or order), the
Custodian may place and maintain Foreign Assets in the care of any Permissible
Foreign Custodian. Article 3 (other than the definitions in Section 3.1) of
this Contract shall not apply to placement of Foreign Assets by the Custodian
with a Permissible Custodian.

4.5.  Transactions in Foreign Custody Account.
      ---------------------------------------

      4.5.1.    Delivery of Foreign Securities.
                ------------------------------

The Custodian or a Foreign Sub-Custodian shall release and deliver foreign
securities of the Fund held by such Foreign Sub-Custodian, or in a Foreign
Securities System account, only upon receipt of Proper Instructions, which may
be continuing instructions when deemed appropriate by the parties, and only in
the following cases:

      (i)   upon the sale of such foreign securities for the Fund in
            accordance with reasonable market practice in the country where
            such foreign securities are held or traded, including, without
            limitation: (A) delivery against expectation of receiving later
            payment; or (B) in the case of a sale effected through a Foreign
            Securities System, in accordance with the rules governing the
            operation of the Foreign Securities System;

      (ii)  in connection with any repurchase agreement related to foreign
            securities;



                                      6
<PAGE>

      (iii) to the depository agent in connection with tender or other similar
            offers for foreign securities of the Fund;

      (iv)  to the issuer thereof or its agent when such foreign securities
            are called, redeemed, retired or otherwise become payable;

      (v)   to the issuer thereof, or its agent, for transfer into the name of
            the Custodian (or the name of the respective Foreign Sub-Custodian
            or of any nominee of the Custodian or such Foreign Sub-Custodian)
            or for exchange for a different number of bonds, certificates or
            other evidence representing the same aggregate face amount or
            number of units;

      (vi)  to brokers, clearing banks or other clearing agents for
            examination or trade execution in accordance with market custom;
            provided that in any such case the Foreign Sub-Custodian shall
            have no responsibility or liability for any loss arising from the
            delivery of such securities prior to receiving payment for such
            securities except as may arise from the Foreign Sub-Custodian's
            own negligence or willful misconduct;

      (vii) for exchange or conversion pursuant to any plan of merger,
            consolidation, recapitalization, reorganization or readjustment of
            the securities of the issuer of such securities, or pursuant to
            provisions for conversion contained in such securities, or
            pursuant to any deposit agreement;

      (viii) in the case of warrants, rights or similar foreign
            securities, the surrender thereof in the exercise of such
            warrants, rights or similar securities or the surrender of interim
            receipts or temporary securities for definitive securities;

      (ix)  for delivery as security in connection with any borrowings by the
            Fund requiring a pledge of assets by the Fund;

      (x)   in connection with trading in options and futures contracts,
            including delivery as original margin and variation margin;

      (xi)  in connection with the lending of foreign securities; and

      (xii) for any other proper corporate purpose, but only upon receipt of,
            in addition to Proper Instructions, a copy of a resolution of the
            Board or of an Executive Committee of the Board so authorized by
            the Board, signed by an officer of the Fund and certified by its
            Secretary or an Assistant Secretary that the resolution was duly
            adopted and is in full force and effect (a "Certified
            Resolution"), specifying the foreign securities to be delivered,
            setting forth the purpose for which such delivery is to be made,
            declaring such purpose to be a proper corporate purpose, and
            naming the person or persons to whom delivery of such securities
            shall be made.



                                      7
<PAGE>

      4.5.2.  Payment of Fund Monies.
              -----------------------

Upon receipt of Proper Instructions, which may be continuing instructions when
deemed appropriate by the parties, the Custodian shall pay out, or direct the
respective Foreign Sub-Custodian or the respective Foreign Securities System
to pay out, monies of the Fund in the following cases only:

      (i)   upon the purchase of foreign securities for the Fund, unless
            otherwise directed by Proper Instructions, by (A) delivering
            money to the seller thereof or to a dealer therefor (or an agent
            for such seller or dealer) against expectation of receiving later
            delivery of such foreign securities; or (B) in the case of a
            purchase effected through a Foreign Securities System, in
            accordance with the rules governing the operation of such Foreign
            Securities System;

      (ii)  in connection with the conversion, exchange or surrender of
            foreign securities of the Fund;

      (iii) for the payment of any expense or liability of the Fund including
            but not limited to the following payments: interest, taxes,
            investment advisory fees, transfer agency fees, fees under this
            Contract, legal fees, accounting fees, and other operating
            expenses;

      (iv)  for the purchase or sale of foreign exchange or foreign exchange
            contracts for the Fund, including transactions executed with or
            through the Custodian or its Foreign Sub-Custodians;

      (v)   in connection with trading in options and futures contracts,
            including delivery as original margin and variation margin;

      (vi)  in connection with the borrowing/lending of foreign securities;
            and

      (vii) for any other proper corporate purpose, but only upon receipt of,
            in addition to Proper Instructions, a Certified Resolution
            specifying the amount of such payment, setting forth the purpose
            for which such payment is to be made, declaring such purpose to be
            a proper corporate purpose, and naming the person or persons to
            whom such payment is to be made.

      4.5.3.  Market Conditions.
              -----------------

Notwithstanding any provision of this Contract to the contrary, settlement and
payment for Foreign Assets received for the account of the Fund and delivery
of Foreign Assets maintained for the account of the Fund may be effected in
accordance with the customary established securities trading or processing
practices and procedures in the country or market in which the transaction
occurs, including, without limitation, delivering Foreign Assets to the
purchaser thereof or to a dealer therefor (or an agent for such purchaser or
dealer) with the expectation of receiving later payment for such Foreign
Assets from such purchaser or dealer.



                                      8
<PAGE>

4.6.  Registration of Foreign Securities.
      ----------------------------------

The foreign securities maintained in the custody of a Foreign Custodian (other
than bearer securities) shall be registered in the name of the Fund or in the
name of the Custodian or in the name of any Foreign Sub-Custodian or in the
name of any nominee of the foregoing, and the Fund agrees to hold any such
nominee harmless from any liability as a holder of record of such foreign
securities. The Custodian or a Foreign Sub-Custodian shall not be obligated to
accept securities on behalf of the Fund under the terms of this Contract
unless the form of such securities and the manner in which they are delivered
are in accordance with reasonable market practice.

4.7.  Bank Accounts.
      -------------

A bank account or bank accounts opened and maintained outside the United
States on behalf of the Fund with a Foreign Sub-Custodian shall be subject
only to draft or order by the Custodian or such Foreign Sub-Custodian, acting
pursuant to the terms of this Contract to hold cash received by or from or for
the account of the Fund.

4.8.  Collection of Income.
      --------------------

The Custodian shall use reasonable endeavors to collect all income and other
payments in due course with respect to the Foreign Assets held hereunder to
which the Fund shall be entitled and shall credit such income, as collected,
to the Fund. In the event that extraordinary measures are required to collect
such income, the Fund and the Custodian shall consult as to such measures and
as to the compensation and expenses of the Custodian relating to such
measures.

4.9.  Proxies.
      -------

The Custodian will generally with respect to the foreign securities held under
this Article 4 use its reasonable endeavors to facilitate the exercise of
voting and other shareholder proxy rights, subject always to the laws,
regulations and practical constraints that may exist in the country where such
securities are issued. The Fund acknowledges that local conditions, including
lack of regulation, onerous procedural obligations, lack of notice and other
factors may have the effect of severely limiting the ability of the Fund to
exercise shareholder rights.

4.10. Communications Relating to Foreign Securities.
      ---------------------------------------------

The Custodian shall transmit promptly to the Fund written information
(including, without limitation, pendency of calls and maturities of foreign
securities and expirations of rights in connection therewith) received by the
Custodian via the Foreign Sub-Custodians from issuers of the foreign
securities being held for the account of the Fund. With respect to tender or
exchange offers, the Custodian shall transmit promptly to the Fund written
information so received by the Custodian from issuers of the foreign
securities whose tender or exchange is sought or from the party (or its
agents) making the tender or exchange offer. The Custodian shall not be liable
for any untimely exercise of any tender, exchange or other right or power in
connection with foreign securities or other property of the Fund at any time
held by it unless (i) the Custodian or the respective Foreign Sub-Custodian is
in actual possession of such foreign securities or property and (ii) the
Custodian receives Proper Instructions with regard to the exercise of any such
right


                                      9
<PAGE>

or power, and both (i) and (ii) occur at least three business days prior to
the date on which such right or power is to be exercised.

4.11. Liability of Foreign Sub-Custodians and Foreign Securities Systems.
      ------------------------------------------------------------------

Each agreement pursuant to which the Custodian employs a Foreign Sub-Custodian
shall, to the extent possible, require the Foreign Sub-Custodian to exercise
reasonable care in the performance of its duties and, to the extent possible,
to indemnify, and hold harmless, the Custodian from and against any loss,
damage, cost, expense, liability or claim arising out of or in connection with
such Foreign Sub-Custodian's performance of such obligations. At the election
of the Fund, the Fund shall be entitled to be subrogated to the rights of the
Custodian with respect to any claims against a Foreign Sub-Custodian as a
consequence of any such loss, damage, cost, expense, liability or claim if and
to the extent that the Fund has not been made whole for any such loss, damage,
cost, expense, liability or claim.

4.12. Tax Law.
      -------

The Custodian shall have no responsibility or liability for any obligations
now or hereafter imposed on the Fund or the Custodian as custodian of the Fund
by the tax law of the United States or of any state or political subdivision
thereof. It shall be the responsibility of the Fund to notify the Custodian of
the obligations imposed on the Fund or the Custodian as custodian of the Fund
by the tax law of countries other than those mentioned in the above sentence,
including responsibility for withholding and other taxes, assessments or other
governmental charges, certifications and governmental reporting. The sole
responsibility of the Custodian with regard to such tax law shall be to use
reasonable efforts to assist the Fund with respect to any claim for exemption
or refund under the tax law of countries for which the Fund has provided such
information.

4.13. Liability of Custodian.
      ----------------------

Except as may arise from the Custodian's own negligence or willful misconduct
or the negligence or willful misconduct of a Sub-Custodian, the Custodian
shall be without liability to the Fund for any loss, liability, claim or
expense resulting from or caused by anything which is (A) part of Country Risk
or (B) part of the "prevailing country risk" of the Fund, as such term is used
in SEC Release Nos. IC-22658; IS-1080 (May 12, 1997) or as such term or
other-similar terms are now or in the future interpreted by the U.S.
Securities and Exchange Commission or by the staff of the Division of
Investment Management of such Securities and Exchange Commission.

The Custodian shall be liable for the acts or omissions of a Foreign
Sub-Custodian to the same extent as set forth with respect to sub-custodians
generally in the Contract and, regardless of whether assets are maintained in
the custody of a Foreign Sub-Custodian or a Foreign Securities Depository, the
Custodian shall not be liable for any loss, damage, cost, expense, liability
or claim resulting from nationalization, expropriation, currency restrictions,
or acts of war or terrorism, or any other loss where the Sub-Custodian has
otherwise acted with reasonable care.



                                      10
<PAGE>

II.   Except as specifically superseded or modified herein, the terms and
      provisions of the Contract shall continue to apply with full force and
      effect. In the event of any conflict between the terms of the Contract
      prior to this Amendment and this Amendment, the terms of this Amendment
      shall prevail. If the Custodian is delegated the responsibilities of
      Foreign Custody Manager pursuant to the terms of Article 3 hereof, in
      the event of any conflict between the provisions of Articles 3 and 4
      hereof, the provisions of Article 3 shall prevail.




                                      11
<PAGE>


      IN WITNESS WHEREOF, each of the parties has caused this Amendment to be
executed in its name and behalf by its duly authorized representative as of
the date first above written.


WITNESSED BY:                            STATE STREET BANK AND TRUST COMPANY


_________________________________
Glenn Ciotti                             By:_________________________________
Vice President &                         Name:  Ronald E. Logue
Associate Counsel                        Title: Executive Vice President







WITNESSED BY:                            ROYCE VALUE TRUST, INC.


_________________________________
                                         By:_________________________________
                                         Name:
                                         Title:





                                      12
<PAGE>




<TABLE>
<CAPTION>
                                                    STATE STREET                               SCHEDULE A
                                               GLOBAL CUSTODY NETWORK
                                       SUBCUSTODIANS AND OPTIONAL DEPOSITORIES


Country                          Subcustodian                                        Optional Depositories

<S>                              <C>                                                 <C>
Argentina                        Citibank, N.A.                                      --

Australia                        Westpac Banking Corporation                         --

Austria                          GiroCredit Bank Aktiengesellschaft der Sparkassen   --

Bahrain                          The British Bank of the Middle East (as delegate    --
                                 of the Hongkong and Shanghai Banking Corporation
                                 Limited)

Bangladesh                       Standard Chartered Bank                             --

Belgium                          Generale Bank                                       --

Bermuda                          The Bank of Bermuda Limited                         --

Bolivia                          Banco Boliviano Americano                           --

Botswana                         Barclays Bank of Botswana Limited                   --

Brazil                           Citibank, N.A.                                      --

Canada                           Canada Trustco Mortgage Company                     --

Chile                            Citibank, N.A.                                      --

People's Republic of China       The Hongkong and Shanghai Banking Corporation       --
                                 Limited, Shanghai and Shenzhen branches

Columbia                         Cititrust Colombia S.A.                             --
                                 Sociedad Fiduciaria

Croatia                          Privredana banka Zagreb d.d                         --

Cyprus                           Barclays Bank PLC Cyprus Offshore Banking Unit      --



<PAGE>


<CAPTION>
                                                    STATE STREET                               SCHEDULE A
                                               GLOBAL CUSTODY NETWORK
                                       SUBCUSTODIANS AND OPTIONAL DEPOSITORIES


Country                          Subcustodian                                        Optional Depositories

<S>                              <C>                                                 <C>
Czech Republic                   Ceskoslovenska Obchodni                             --
                                 Banka A.S.

Denmark                          Den Danske Bank                                     --

Ecuador                          Citibank, N.A.                                      --

Egypt                            National Bank of Egypt                              --

Estonia                          Hansabank                                           --

Finland                          Merita Bank Limited                                 --

France                           Banque Paribas                                      --

Germany                          Dresdner Bank AG                                    --

Ghana                            Barclays Bank of Ghana Limited                      --

Greece                           National Bank of Greece S.A                         Bank of Greece

Hong Kong                        Standard Chartered Bank                             --

Hungary                          Citibank Budapest Rt.                               --

India                            Deutsche Bank AG; The Hongkong and Shanghai         --
                                 Banking Corporation Limited

Indonesia                        Standard Chartered Bank                             --

Ireland                          Bank of Ireland                                     --

Israel                           Bank Hapoalim B.M.                                  --

Italy                            Banque Paribas                                      --

Ivory Coast                      Societe Generale de Banques en Cote d'Ivoire        --

Jamaica                          Scotiabank Trust and Merchant Bank                  --


<PAGE>


<CAPTION>
                                                    STATE STREET                               SCHEDULE A
                                               GLOBAL CUSTODY NETWORK
                                       SUBCUSTODIANS AND OPTIONAL DEPOSITORIES


Country                          Subcustodian                                        Optional Depositories

<S>                              <C>                                                 <C>

Japan                            The Daiwa Bank, Limited;                            Japan Securities Depository
                                 The Fuji Bank, Limited;                             Center;
                                 The Sumitomo Trust
                                 & Banking Co., Ltd.

Jordan                           The British Bank of the Middle East (as delegate    --
                                 of the Hongkong and Shanghai Banking Corporation
                                 Limited)

Kenya                            Barclays Bank of Kenya Limited                      --

Republic of Korea                Citibank, N.A.                                      --

Lebanon                          The British Bank of the Middle East                 Custodian and Clearing Center
                                 (as delegate of the Hongkong and                    of Financial Instruments for
                                 Shanghai Banking Corporation                        Lebanon (MIDCLEAR) S.A.L.;
                                 Limited)

Malaysia                         Standard Chartered Bank                             --
                                 Malaysia Berhad

Mauritius                        The Hongkong and Shanghai Banking Corporation       --
                                 Limited

Mexico                           Citibank Mexico, S.A.                               --

Morocco                          Banque Commerciale du Maroc                         --

Namibia                          (via) Standard Bank of South Africa                 -

Netherlands                      MeesPierson N.V.                                    --

New Zealand                      ANZ Banking Group                                   --
                                 (New Zealand) Limited

Norway                           Christiania Bank og Kreditkasse                     --

Oman                             The British Bank of the Middle East (as delegate    --
                                 of the Hongkong and
                                 Shanghai Banking Corporation Limited)


<PAGE>

<CAPTION>
                                                    STATE STREET                               SCHEDULE A
                                               GLOBAL CUSTODY NETWORK
                                       SUBCUSTODIANS AND OPTIONAL DEPOSITORIES


Country                          Subcustodian                                        Optional Depositories

<S>                              <C>                                                 <C>

Pakistan                         Deutsche Bank AG                                    --

Peru                             Citibank, N.A.                                      --

Philippines                      Standard Chartered Bank                             --

Poland                           Citibank Poland S.A.                                --

Portugal                         Banco Comercial Portugues                           --

Romania                          ING Bank, N.V.                                      --

Russia                           Credit Suisse First Boston, Zurich                  --
                                 via Credit Suisse First Boston
                                 Limited, Moscow

Singapore                        The Development Bank                                --
                                 of Singapore Ltd.

Slovak Republic                  Ceskoslovenska Obchodna                             --
                                 Banka A.S.

South Africa                     Standard Bank of South Africa Limited               --

Spain                            Banco Santander, S.A.                               --

Sri Lanka                        The Hongkong and Shanghai Banking Corporation       --
                                 Limited

Swaziland                        Barclays Bank of Swaziland Limited                  --

Sweden                           Skandinaviska Enskilda Banken                       --

Switzerland                      Union Bank of Switzerland                           --

Taiwan - R.O.C.                  Central Trust of China                              --

Thailand                         Standard Chartered Bank                             --

Trinidad & Tobago                Republic Bank Ltd.                                  --


<PAGE>

<CAPTION>
                                                    STATE STREET                               SCHEDULE A
                                               GLOBAL CUSTODY NETWORK
                                       SUBCUSTODIANS AND OPTIONAL DEPOSITORIES


Country                          Subcustodian                                        Optional Depositories

<S>                              <C>                                                 <C>

Tunisia                          Banque Internationale Arabe de Tunisie              --

Turkey                           Citibank, N.A.                                      --

United Kingdom                   State Street Bank and Trust                         --

Uruguay                          Citibank, N.A.                                      --

Venezuela                        Citibank, N.A.                                      --

Zambia                           Barclays Bank of Zambia Limited                     --

Zimbabwe                         Barclays Bank of Zimbabwe Limited                   --

Euroclear (The Euroclear System)

Cedel (Cedel Bank, societe anonyme)

INTERSETTLE (for EASDAQ Securities)
</TABLE>





<PAGE>



                                 STATE STREET                       SCHEDULE B
                            GLOBAL CUSTODY NETWORK
                            MANDATORY* DEPOSITORIES

Country                                        Mandatory Depositories

Argentina                                      -Caja de Valores S.A.;

                                               -CRYL

Australia                                      -Austraclear Limited;

                                               -Reserve Bank Information and
                                               Transfer System

Austria                                        -Oesterreichische Kontrollbank
                                               AG (Wertpapiersammelbank
                                               Division)

Belgium                                        -Caisse Interprofessionnelle de
                                               Depots et de Virements de Titres
                                               S.A.;

                                               -Banque Nationale de Belgique

Brazil                                         -Bolsa de Valores de Sao Paulo;

                                               -Bolsa de Valores de Rio de
                                               Janeiro
                                               - All SSB clients presently use
                                               Calispa

                                               -Central de Custodia e de
                                               Liquidacao Financeira de Titulos

                                               -Banco Central do Brasil,
                                               Systema Especial de Liquidacao e
                                               Custodia

Canada                                         -The Canadian Depository for
                                               Securities Limited; West Canada
                                               Depository Trust Company
                                               [depositories linked]

People's Republic of China                     -Shanghai Securities Central
                                               Clearing and Registration
                                               Corporation;

                                               -Shenzhen Securities Central
                                               Clearing Co., Ltd.

* Mandatory depositories include entities for which use is mandatory as a
matter of law or effectively mandatory as a matter of market practice.


<PAGE>



                                 STATE STREET                       SCHEDULE B
                            GLOBAL CUSTODY NETWORK
                            MANDATORY* DEPOSITORIES

Country                                        Mandatory Depositories

Croatia                                        Ministry of Finance

Czech Republic                                 -Stredisko cennych papiru;

                                               -Czech National Bank

Denmark                                        -Vaerdipapircentralen - The
                                               Danish Securities Center

Egypt                                          -Misr Company for Clearing,
                                               Settlement, and Central
                                               Depository

Estonia                                        Eesti Vaartpaberite
                                               Keskdepositooruim

Finland                                        -The Finnish Central Securities
                                               Depository

France                                         -Societe Interprofessionnelle
                                               pour la Compensation des Valeurs
                                               Mobilieres;

                                               -Banque de France, Saturne System

Germany                                        -The Deutscher Kassenverein AG

Greece                                         -The Central Securities
                                               Depository (Apothetirion Titlon
                                               A.E.);

Hong Kong                                      -The Central Clearing and
                                               Settlement System;

                                               -The Central Money Markets Unit

Hungary                                        -The Central Depository and
                                               Clearing House (Budapest) Ltd.
                                               [Mandatory for Gov't Bonds only;
                                               SSB does not use for other
                                               securities]

Indonesia                                      -Bank of Indonesia



* Mandatory depositories include entities for which use is mandatory as a
matter of law or effectively mandatory as a matter of market practice.


<PAGE>



                                 STATE STREET                       SCHEDULE B
                            GLOBAL CUSTODY NETWORK
                            MANDATORY* DEPOSITORIES

Country                                        Mandatory Depositories

Ireland                                        -The Central Bank of Ireland,
                                               The Gilt Settlement Office

Israel                                         -The Clearing House of the Tel
                                               Aviv Stock Exchange;

                                               -Bank of Israel

Italy                                          -Monte Titoli S.p.A.;

                                               -Banca d'Italia

Japan                                          -Bank of Japan Net System

Republic of Korea                              -Korea Securities Depository

Lebanon                                        -The Central Bank of Lebanon

Malaysia                                       -Malaysian Central Depository
                                               Sdn. Bhd.;

                                               -Bank Negara Malaysia, Scripless
                                               Securities Trading and
                                               Safekeeping Systems

Mauritius                                      -The Central Depository &
                                               Settlement System

Mexico                                         -S.D. INDEVAL, S.A. de C.V.
                                               (Instituto para el Deposito de
                                               Valores);





* Mandatory depositories include entities for which use is mandatory as a
matter of law or effectively mandatory as a matter of market practice.


<PAGE>



                                 STATE STREET                       SCHEDULE B
                            GLOBAL CUSTODY NETWORK
                            MANDATORY* DEPOSITORIES

Country                                        Mandatory Depositories

Netherlands                                    -Nederlands Centraal lnstituut
                                               voor Giraal Effectenverkeer B.V.
                                               ("NECIGEF");

                                               -De Nederlandsche Bank N.V.
                                               ("NBNV")**

New Zealand                                    -New Zealand Central Securities
                                               Depository Limited

Norway                                         -Verdipapirsentralen - The
                                               Norwegian Registry of Securities

Oman                                           -Muscat Securities Market

Peru                                           -Caja de Valores y Liquidaciones
                                               (CAVALI, S.A.)

Philippines                                    -The Philippines Central
                                               Depository Inc.

                                               -The Book-Entry-System of Bangko
                                               Sentral ng Pilipinas;

                                               -The Registry of Scripless
                                               Securities of the Bureau of the
                                               Treasury

Poland                                         -The National Depository of
                                               Securities (Krajowy Depozyt
                                               Papierow Wartooeciowych);

                                               -National Bank of Poland

Portugal                                       -Central de Valores Mobiliarios



* Mandatory depositories include entities for which use is mandatory as a
matter of law or effectively mandatory as a matter of market practice.
** It is planned that as of 1/1/98 NBNV will no longer hold government
securities, all securities will be transferred to NECIGEF.



<PAGE>


                                 STATE STREET                       SCHEDULE B
                            GLOBAL CUSTODY NETWORK
                            MANDATORY* DEPOSITORIES

Country                                        Mandatory Depositories

Romania                                        -National Securities Clearing,
                                               Settlement and Depository Co.;

                                               -Bucharest Stock Exchange;

                                               -National Bank of Romania

Singapore                                      -The Central Depository (Pte)
                                               Limited;

                                               -Monetary Authority of Singapore

Slovak Republic                                -Stredisko Cennych Papierov;

                                               -National Bank of Slovakia

South Africa                                   -The Central Depository Limited

Spain                                          -Servicio de Compensacion y
                                               Liquidacion de Valores, S.A.;

                                               -Banco de Espana, Anotaciones en
                                               Cuenta

Sri Lanka                                      -Central Depository System (Pvt)
                                               Limited

Sweden                                         -Vardepapperscentralen VPC AB

                                               -The Swedish Central Securities
                                               Depository

Switzerland                                    -Schweizerische Effekten - Giro
                                               AG;

Taiwan- R.O.C.                                 -The Taiwan Securities Central
                                               Depository Company, Ltd.

Thailand                                       -Thailand Securities Depository
                                               Company Limited

Tunisia                                        -STICODEVAM;

                                               -Central Bank of Tunisia;




* Mandatory depositories include entities for which use is mandatory as a
matter of law or effectively mandatory as a matter of market practice.


<PAGE>



                                 STATE STREET                       SCHEDULE B
                            GLOBAL CUSTODY NETWORK
                            MANDATORY* DEPOSITORIES

Country                                        Mandatory Depositories


                                               -Tunisian Treasury

Turkey                                         -Takas ve Saklama Bankasi A.S.;

                                               -Central Bank of Turkey

United Kingdom                                 -The Bank of England,
                                               The Central Gilts Office;
                                               The Central Moneymarkets Office;
                                               The European Settlements Office;

                                               -First Chicago Clearing Centre

Uruguay                                        -Central Bank of Uruguay

Zambia                                         -Lusaka Central Depository




* Mandatory depositories include entities for which use is mandatory as a
matter of law or effectively mandatory as a matter of market practice.


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.J6
<SEQUENCE>17
<FILENAME>efc2-1398_exhibitj6.txt
<TEXT>
                                                                Exhibit (j)(6)


                        AMENDMENT TO CUSTODIAN CONTRACT


      This Amendment to the Custodian Contract is made as of September 14,
2000 by and between Royce Value Trust, Inc. (the "Fund") and State Street Bank
and Trust Company (the "Custodian"). Capitalized terms used in this Amendment
without definition shall have the respective meanings given to such terms in
the Custodian Contract referred to below.

      WHEREAS, the Fund and the Custodian entered into a Custodian Contract
dated as of December 31, 1996 (as amended and in effect from time to time, the
"Contract"); and

      WHEREAS, the Fund and the Custodian desire to amend certain provisions
of the Contract to reflect revisions to Rule 17f-5 ("Rule 17f-5") and the
adoption of Rule 17f-7 ("Rule 17f-7") promulgated under the Investment Company
Act of 1940, as amended (the "1940 Act"); and

      WHEREAS, the Fund and the Custodian desire to amend and restate certain
other provisions of the Contract relating to the custody of assets of the Fund
held outside of the United States.

      NOW THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements hereinafter contained, the parties hereby agree to
amend the Contract, pursuant to the terms thereof, as follows:

I.    The amendment to the Contract dated November 7, 1997 and relating
      to the 1997 revision of Rule 17f-5 revision is hereby deleted, and the
      parties hereto agree that it shall be and is replaced in its entirety by
      the provisions set forth below.

3.    Provisions Relating to Rules 17f-5 and 17f-7

3.1.  Definitions. Capitalized terms in this Amendment shall have the
      following meanings:

"Country Risk" means all factors reasonably related to the systemic risk of
holding Foreign Assets in a particular country including, but not limited to,
such country's political environment, economic and financial infrastructure
(including any Eligible Securities Depository operating in the country),
prevailing or developing custody and settlement practices, and laws and
regulations applicable to the safekeeping and recovery of Foreign Assets held
in custody in that country.

"Eligible Foreign Custodian" has the meaning set forth in section (a)(1) of
Rule 17f-5, including a majority-owned or indirect subsidiary of a U.S. Bank
(as defined in Rule 17f-5), a bank holding company meeting the requirements of
an Eligible Foreign Custodian (as set forth in Rule 17f-5 or by other
appropriate action of the U.S. Securities and Exchange Commission (the
"SEC")), or a foreign branch of a Bank (as defined in Section 2(a)(5) of the
1940 Act) meeting the requirements of a custodian under Section 17(f) of the
1940 Act; the term does not include any Eligible Securities Depository.

"Eligible Securities Depository" has the meaning set forth in section (b)(1)
of Rule 17f-7.


<PAGE>


"Foreign Assets" means any of the Fund's investments (including foreign
currencies) for which the primary market is outside the United States and such
cash and cash equivalents as are reasonably necessary to effect the Fund's
transactions in such investments.

"Foreign Custody Manager" has the meaning set forth in section (a)(2) of Rule
17f-5.

3.2. The Custodian as Foreign Custody Manager.

      3.2.1 Delegation to the Custodian as Foreign Custody Manager. The Fund,
as authorized by resolution adopted by its Board of Directors (the "Board of
Directors"), hereby delegates to the Custodian, subject to Section (b) of Rule
17f-5, the responsibilities set forth in this Section 3.2 with respect to
Foreign Assets held outside the United States, and the Custodian hereby
accepts such delegation as Foreign Custody Manager of the Fund.

      3.2.2 Countries Covered. The Foreign Custody Manager shall be
responsible for performing the delegated responsibilities defined below only
with respect to the countries and custody arrangements for each such country
listed on Schedule A to this Contract, which list of countries may be amended
from time to time by the Fund with the agreement of the Foreign Custody
Manager. The Foreign Custody Manager shall list on Schedule A the Eligible
Foreign Custodians selected by the Foreign Custody Manager to maintain the
Fund's assets, which list of Eligible Foreign Custodians may be amended from
time to time in the sole discretion of the Foreign Custody Manager. The
Foreign Custody Manager will provide amended versions of Schedule A in
accordance with Section 3.2.5 hereof.

Upon the receipt by the Foreign Custody Manager of Proper Instructions to open
an account or to place or maintain Foreign Assets in a country listed on
Schedule A, and the fulfillment by the Fund of the applicable account opening
requirements for such country, the Foreign Custody Manager shall be deemed to
have been delegated by the Board of Directors responsibility as Foreign
Custody Manager with respect to that country and to have accepted such
delegation. Execution of this Amendment by the Fund shall be deemed to be a
Proper Instruction to open an account, or to place or maintain Foreign Assets,
in each country listed on Schedule A in which the Custodian has previously
placed or currently maintains Foreign Assets pursuant to the terms of the
Contract. Following the receipt of Proper Instructions directing the Foreign
Custody Manager to close the account of the Fund with the Eligible Foreign
Custodian selected by the Foreign Custody Manager in a designated country, the
delegation by the Board of Directors to the Custodian as Foreign Custody
Manager for that country shall be deemed to have been withdrawn and the
Custodian shall immediately cease to be the Foreign Custody Manager of the
Fund with respect to that country.

The Foreign Custody Manager may withdraw its acceptance of delegated
responsibilities with respect to a designated country upon thirty days prior
written notice to the Fund. Thirty days (or such longer period to which the
parties agree in writing) after receipt of any such notice by the Fund, the
Custodian shall have no further responsibility in its capacity as Foreign
Custody Manager to the Fund with respect to the country as to which the
Custodian's acceptance of delegation is withdrawn.



                                      2
<PAGE>

      3.2.3 Scope of Delegated Responsibilities:

            (a) Selection of Eligible Foreign Custodians. Subject to the
provisions of this Section 3.2, the Foreign Custody Manager may place and
maintain the Foreign Assets in the care of the Eligible Foreign Custodian
selected by the Foreign Custody Manager in each country listed on Schedule A,
as amended from time to time. In performing its delegated responsibilities as
Foreign Custody Manager to place or maintain Foreign Assets with an Eligible
Foreign Custodian, the Foreign Custody Manager shall determine that the
Foreign Assets will be subject to reasonable care, based on the standards
applicable to custodians in the country in which the Foreign Assets will be
held by that Eligible Foreign Custodian, after considering all factors
relevant to the safekeeping of such assets, including, without limitation the
factors specified in Rule 17f-5(c)(1).

            (b) Contracts With Eligible Foreign Custodians. The Foreign
Custody Manager shall determine that the contract governing the foreign
custody arrangements with each Eligible Foreign Custodian selected by the
Foreign Custody Manager will satisfy the requirements of Rule 17f-5(c)(2).

            (c) Monitoring. In each case in which the Foreign Custody Manager
maintains Foreign Assets with an Eligible Foreign Custodian selected by the
Foreign Custody Manager, the Foreign Custody Manager shall establish a system
to monitor (i) the appropriateness of maintaining the Foreign Assets with such
Eligible Foreign Custodian and (ii) the contract governing the custody
arrangements established by the Foreign Custody Manager with the Eligible
Foreign Custodian. In the event the Foreign Custody Manager determines that
the custody arrangements with an Eligible Foreign Custodian it has selected
are no longer appropriate, the Foreign Custody Manager shall notify the Board
of Directors in accordance with Section 3.2.5 hereunder.

      3.2.4 Guidelines for the Exercise of Delegated Authority. For purposes
of this Section 3.2, the Board of Directors (or its delegate duly authorized
by appropriate action of the Board of Directors) shall be deemed to have
considered and determined to accept such Country Risk as is incurred by
placing and maintaining the Foreign Assets in each country for which the
Custodian is serving as Foreign Custody Manager of the Fund.

      3.2.5 Reporting Requirements. The Foreign Custody Manager shall report
the withdrawal of the Foreign Assets from an Eligible Foreign Custodian and
the placement of such Foreign Assets with another Eligible Foreign Custodian
by providing to the Board of Directors an amended Schedule A at the end of the
calendar quarter in which an amendment to such Schedule has occurred. The
Foreign Custody Manager shall make written reports notifying the Board of
Directors of any other material change in the foreign custody arrangements of
the Fund described in this Section 3.2 as soon as is reasonably practicable
after the occurrence of the material change.

      3.2.6 Standard of Care as Foreign Custody Manager of the Fund. In
performing the responsibilities delegated to it, the Foreign Custody Manager
agrees to exercise reasonable care, prudence and diligence such as a person
having responsibility for the safekeeping of assets of management investment
companies registered under the 1940 Act would exercise.



                                      3
<PAGE>

      3.2.7 Representations with Respect to Rule 17f-5. The Foreign Custody
Manager represents to the Fund that it is a U.S. Bank as defined in section
(a)(7) of Rule 17f-5. The Fund represents to the Custodian that the Board of
Directors has determined that it is reasonable for the Board of Directors to
rely on the Custodian to perform the responsibilities delegated pursuant to
this Contract to the Custodian as the Foreign Custody Manager of the Fund.

      3.2.8 Effective Date and Termination of the Custodian as Foreign Custody
Manager. The Board of Directors's delegation to the Custodian as Foreign
Custody Manager of the Fund shall be effective as of the date hereof and shall
remain in effect until terminated at any time, without penalty, by written
notice from the terminating party to the non-terminating party. Termination
will become effective thirty (30) days after receipt by the non-terminating
party of such notice. The provisions of Section 3.2.2 hereof shall govern the
delegation to and termination of the Custodian as Foreign Custody Manager of
the Fund with respect to designated countries.

3.3. Eligible Securities Depositories.

      3.3.1 Analysis and Monitoring. The Custodian shall (a) provide the Fund
(or its duly-authorized investment manager or investment adviser) with an
analysis of the custody risks associated with maintaining assets with the
Eligible Securities Depositories set forth on Schedule B hereto in accordance
with section (a)(1)(i)(A) of Rule 17f-7, and (b) monitor such risks on a
continuing basis, and promptly notify the Fund (or its duly-authorized
investment manager or investment adviser) of any material change in such
risks, in accordance with section (a)(1)(i)(B) of Rule 17f-7.

      3.3.2 Standard of Care. The Custodian agrees to exercise reasonable
care, prudence and diligence in performing the duties set forth in Section
3.3.1.

4.    Duties of the Custodian with Respect to Fund Property Held Outside
      the United States.

4.1.  Definitions. Capitalized terms in this Article 4 shall have the
      following meanings:

"Foreign Securities System" means an Eligible Securities Depository listed on
Schedule B hereto.

"Foreign Sub-Custodian" means a foreign banking institution serving as an
Eligible Foreign Custodian.

4.2. Holding Securities. The Custodian shall identify on its books as
belonging to the Fund the foreign securities held by each Foreign
Sub-Custodian or Foreign Securities System. The Custodian may hold foreign
securities for all of its customers, including the Fund, with any Foreign
Sub-Custodian in an account that is identified as belonging to the Custodian
for the benefit of its customers, provided however, that (i) the records of
the Custodian with respect to foreign securities of the Fund which are
maintained in such account shall identify those securities as belonging to the
Fund and (ii), to the extent permitted and customary in the market in which
the account is maintained, the Custodian shall require that securities so held
by the Foreign Sub-


                                      4
<PAGE>

Custodian be held separately from any assets of such Foreign Sub-Custodian or
of other customers of such Foreign Sub-Custodian.

4.3. Foreign Securities Systems. Foreign securities shall be maintained in a
Foreign Securities System in a designated country through arrangements
implemented by the Custodian or a Foreign Sub-Custodian, as applicable, in
such country.

4.4. Transactions in Foreign Custody Account.

      4.4.1 Delivery of Foreign Assets. The Custodian or a Foreign
Sub-Custodian shall release and deliver foreign securities of the Fund held by
the Custodian or such Foreign Sub-Custodian, or in a Foreign Securities System
account, only upon receipt of Proper Instructions, which may be continuing
instructions when deemed appropriate by the parties, and only in the following
cases:

      (i)   upon the sale of such foreign securities for the Fund in
            accordance with commercially reasonable market practice in the
            country where such foreign securities are held or traded,
            including, without limitation: (A) delivery against expectation of
            receiving later payment; or (B) in the case of a sale effected
            through a Foreign Securities System, in accordance with the rules
            governing the operation of the Foreign Securities System;

      (ii)  in connection with any repurchase agreement related to foreign
            securities;

      (iii) to the depository agent in connection with tender or other similar
            offers for foreign securities of the Fund;

      (iv)  to the issuer thereof or its agent when such foreign securities
            are called, redeemed, retired or otherwise become payable;

      (v)   to the issuer thereof, or its agent, for transfer into the name of
            the Custodian (or the name of the respective Foreign Sub-Custodian
            or of any nominee of the Custodian or such Foreign Sub-Custodian)
            or for exchange for a different number of bonds, certificates or
            other evidence representing the same aggregate face amount or
            number of units;

      (vi)  to brokers, clearing banks or other clearing agents for
            examination or trade execution in accordance with market custom;
            provided that in any such case the Foreign Sub-Custodian shall
            have no responsibility or liability for any loss arising from the
            delivery of such securities prior to receiving payment for such
            securities except as may arise from the Foreign Sub-Custodian's
            own negligence or willful misconduct;

      (vii) for exchange or conversion pursuant to any plan of merger,
            consolidation, recapitalization, reorganization or readjustment of
            the securities of the issuer of such securities, or pursuant to
            provisions for conversion contained in such securities, or
            pursuant to any deposit agreement;



                                      5
<PAGE>

      (viii) in the case of warrants, rights or similar foreign
            securities, the surrender thereof in the exercise of such
            warrants, rights or similar securities or the surrender of interim
            receipts or temporary securities for definitive securities;

      (ix)  for delivery as security in connection with any borrowing by the
            Fund requiring a pledge of assets by the Fund;

      (x)   in connection with trading in options and futures contracts,
            including delivery as original margin and variation margin;

      (xi)  in connection with the lending of foreign securities; and

      (xii) for any other purpose, but only upon receipt of Proper
            Instructions specifying the foreign securities to be delivered and
            naming the person or persons to whom delivery of such securities
            shall be made.

      4.4.2 Payment of Fund Monies. Upon receipt of Proper Instructions, which
may be continuing instructions when deemed appropriate by the parties, the
Custodian shall pay out, or direct the respective Foreign Sub-Custodian or the
respective Foreign Securities System to pay out, monies of the Fund in the
following cases only:

      (i)   upon the purchase of foreign securities for the Fund, unless
            otherwise directed by Proper Instructions, by (A) delivering
            money to the seller thereof or to a dealer therefor (or an agent
            for such seller or dealer) against expectation of receiving later
            delivery of such foreign securities; or (B) in the case of a
            purchase effected through a Foreign Securities System, in
            accordance with the rules governing the operation of such Foreign
            Securities System;

      (ii)  in connection with the conversion, exchange or surrender of
            foreign securities of the Fund;

      (iii) for the payment of any expense or liability of the Fund, including
            but not limited to the following payments: interest, taxes,
            investment advisory fees, transfer agency fees, fees under this
            Contract, legal fees, accounting fees, and other operating
            expenses;

      (iv)  for the purchase or sale of foreign exchange or foreign exchange
            contracts for the Fund, including transactions executed with or
            through the Custodian or its Foreign Sub-Custodians;

      (v)   in connection with trading in options and futures contracts,
            including delivery as original margin and variation margin;

      (vi)  for payment of part or all of the dividends received in respect of
            securities sold short;

      (vii) in connection with the borrowing or lending of foreign securities;
            and



                                      6
<PAGE>

      (viii) for any other purpose, but only upon receipt of Proper
            Instructions specifying the amount of such payment and naming the
            person or persons to whom such payment is to be made.

      4.4.3 Market Conditions. Notwithstanding any provision of this Contract
to the contrary, settlement and payment for Foreign Assets received for the
account of the Fund and delivery of Foreign Assets maintained for the account
of the Fund may be effected in accordance with the customary established
securities trading or processing practices and procedures in the country or
market in which the transaction occurs, including, without limitation,
delivering Foreign Assets to the purchaser thereof or to a dealer therefor (or
an agent for such purchaser or dealer) with the expectation of receiving later
payment for such Foreign Assets from such purchaser or dealer.

The Custodian shall provide to the Board of Directors the information with
respect to custody and settlement practices in countries in which the
Custodian employs a Foreign Sub-Custodian described on Schedule C hereto at
the time or times set forth on such Schedule. The Custodian may revise
Schedule C from time to time, provided that no such revision shall result in
the Board of Directors being provided with substantively less information than
had been previously provided hereunder.

4.5. Registration of Foreign Securities. The foreign securities maintained in
the custody of a Foreign Sub-Custodian (other than bearer securities) shall be
registered in the name of the Fund or in the name of the Custodian or in the
name of any Foreign Sub-Custodian or in the name of any nominee of the
foregoing, and the Fund agrees to hold any such nominee harmless from any
liability as a holder of record of such foreign securities. The Custodian or a
Foreign Sub-Custodian shall not be obligated to accept securities on behalf of
the Fund under the terms of this Contract unless the form of such securities
and the manner in which they are delivered are in accordance with reasonable
market practice.

4.6. Bank Accounts. The Custodian shall identify on its books as belonging to
the Fund cash (including cash denominated in foreign currencies) deposited
with the Custodian. Where the Custodian is unable to maintain, or market
practice does not facilitate the maintenance of, cash on the books of the
Custodian, a bank account or bank accounts shall be opened and maintained
outside the United States on behalf of the Fund with a Foreign Sub-Custodian.
All accounts referred to in this Section shall be subject only to draft or
order by the Custodian (or, if applicable, such Foreign Sub-Custodian) acting
pursuant to the terms of this Agreement to hold cash received by or from or
for the account of the Fund. Cash maintained on the books of the Custodian
(including its branches, subsidiaries and affiliates), regardless of currency
denomination, is maintained in bank accounts established under, and subject to
the laws of, The Commonwealth of Massachusetts.

4.7. Collection of Income. The Custodian shall use reasonable commercial
efforts to collect all income and other payments with respect to the Foreign
Assets held hereunder to which the Fund shall be entitled and shall credit
such income, as collected, to the Fund. In the event that extraordinary
measures are required to collect such income, the Fund and the Custodian shall
consult as to such measures and as to the compensation and expenses of the
Custodian relating to such measures.



                                      7
<PAGE>

4.8. Shareholder Rights. With respect to the foreign securities held pursuant
to this Article 4, the Custodian will use reasonable commercial efforts to
facilitate the exercise of voting and other shareholder rights, subject always
to the laws, regulations and practical constraints that may exist in the
country where such securities are issued. The Fund acknowledges that local
conditions, including lack of regulation, onerous procedural obligations, lack
of notice and other factors may have the effect of severely limiting the
ability of the Fund to exercise shareholder rights.

4.9. Communications Relating to Foreign Securities. The Custodian shall
transmit promptly to the Fund written information with respect to materials
received by the Custodian via the Foreign Sub-Custodians from issuers of the
foreign securities being held for the account of the Fund (including, without
limitation, pendency of calls and maturities of foreign securities and
expirations of rights in connection therewith). With respect to tender or
exchange offers, the Custodian shall transmit promptly to the Fund written
information with respect to materials so received by the Custodian from
issuers of the foreign securities whose tender or exchange is sought or from
the party (or its agents) making the tender or exchange offer. The Custodian
shall not be liable for any untimely exercise of any tender, exchange or other
right or power in connection with foreign securities or other property of the
Fund at any time held by it unless (i) the Custodian or the respective Foreign
Sub-Custodian is in actual possession of such foreign securities or property
and (ii) the Custodian receives Proper Instructions with regard to the
exercise of any such right or power, and both (i) and (ii) occur at least
three business days prior to the date on which the Custodian is to take action
to exercise such right or power.

4.10. Liability of Foreign Sub-Custodians. Each agreement pursuant to which
the Custodian employs a Foreign Sub-Custodian shall, to the extent possible,
require the Foreign Sub-Custodian to exercise reasonable care in the
performance of its duties, and to indemnify, and hold harmless, the Custodian
from and against any loss, damage, cost, expense, liability or claim arising
out of or in connection with the Foreign Sub-Custodian's performance of such
obligations. At the election of the Fund, the Fund shall be entitled to be
subrogated to the rights of the Custodian with respect to any claims against a
Foreign Sub-Custodian as a consequence of any such loss, damage, cost,
expense, liability or claim if and to the extent that the Fund has not been
made whole for any such loss, damage, cost, expense, liability or claim.

4.11. Tax Law. The Custodian shall have no responsibility or liability for any
obligations now or hereafter imposed on the Fund, or the Custodian as
custodian of the Fund, by the tax law of the United States or of any state or
political subdivision thereof. It shall be the responsibility of the Fund to
notify the Custodian of the obligations imposed on the Fund, or the Custodian
as custodian of the Fund, by the tax law of countries other than the United
States, including responsibility for withholding and other taxes, assessments
or other governmental charges, certifications and governmental reporting. The
sole responsibility of the Custodian with regard to such tax law shall be to
use reasonable efforts to assist the Fund with respect to any claim for
exemption or refund under the tax law.of countries for which the Fund has
provided such information.

4.12. Liability of Custodian. Except as may arise from the Custodian's own
negligence or willful misconduct, or the negligence or willful misconduct of a
Sub-Custodian, the Custodian shall be without liability to the Fund for any
loss, liability, claim or expense resulting from or caused by anything which
is part of Country Risk.



                                      8
<PAGE>

The Custodian shall be liable for the acts or omissions of a Foreign
Sub-Custodian to the same extent as set forth with respect to sub-custodians
generally in the Contract and, regardless of whether assets are maintained in
the custody of a Foreign Sub-Custodian or a Foreign Securities System, the
Custodian shall not be liable for any loss, damage, cost, expense, liability
or claim resulting from nationalization, expropriation, currency restrictions,
or acts of war or terrorism, or any other loss where the Foreign Sub-Custodian
has otherwise acted with reasonable care.

II.   Except as specifically superseded or modified herein, the terms and
      provisions of the Contract shall continue to apply with full force and
      effect. In the event of any conflict between the terms of the Contract
      prior to this Amendment and this Amendment, the terms of this Amendment
      shall prevail. If the Custodian is delegated the responsibilities of
      Foreign Custody Manager pursuant to the terms of Article 3 hereof, in
      the event of any conflict between the provisions of Articles 3 and 4
      hereof, the provisions of Article 3 shall prevail.





                                      9
<PAGE>

      IN WITNESS WHEREOF, each of the parties has caused this Amendment to be
executed in its name and behalf by its duly authorized representative as of
the date first above written.

Witnessed By:                       STATE STREET BANK and TRUST COMPANY


____________________                By:  ___________________________________
Glenn Ciotti                        Name:  Ronald E. Logue
VP & Assoc. Counsel                 Title: Vice Chairman and Chief Operating
                                           Officer



Witnessed By:                       ROYCE VALUE TRUST, INC.


____________________                By:  ___________________________________
John Denneen                        Name:  Daniel A. O'Byrne
Secretary                           Title: Vice President





<PAGE>


                                                                    SCHEDULE A


                                 STATE STREET
                            GLOBAL CUSTODY NETWORK
                                 SUBCUSTODIANS


Country                          Subcustodian

Argentina                        Citibank, N.A.

Australia                        Westpac Banking Corporation

Austria                          Erste Bank der Osterreichischen Sparkassen AG

Bahrain                          HSBC Bank Middle East
                                 (as delegate of The Hongkong and Shanghai
                                 Banking Corporation Limited)

Bangladesh                       Standard Chartered Bank

Belgium                          Fortis Bank nv-sa

Bermuda                          The Bank of Bermuda Limited

Bolivia                          Citibank, N. A.

Botswana                         Barclays Bank of Botswana Limited

Brazil                           Citibank, N.A.

Bulgaria                         ING Bank N.V.

Canada                           State Street Trust Company Canada

Chile                            Citibank, N.A.

People's Republic                The Hongkong and Shanghai
of China                         Banking Corporation Limited,
                                 Shanghai and Shenzhen branches

Colombia                         Cititrust Colombia S.A.
                                 Sociedad Fiduciaria

Costa Rica                       Banco BCT S.A.

Croatia                          Privredna Banka Zagreb d.d

Cyprus                           The Cyprus Popular Bank Ltd.





                                      11
<PAGE>

                                                                    SCHEDULE A


                                 STATE STREET
                            GLOBAL CUSTODY NETWORK
                                 SUBCUSTODIANS


Country                          Subcustodian

Czech Republic                   Eeskoslovenska Obchodni
                                 Banka, A.S.

Denmark                          Den Danske Bank

Ecuador                          Citibank, N.A.

Egypt                            Egyptian British Bank S.A.E.
                                 (as delegate of The Hongkong
                                 and Shanghai Banking Corporation Limited)

Estonia                          Hansabank

Finland                          Merita Bank Plc.

France                           BNP Paribas, S.A.

Germany                          Dresdner Bank AG

Ghana                            Barclays Bank of Ghana Limited

Greece                           National Bank of Greece S.A.

Hong Kong                        Standard Chartered Bank

Hungary                          Citibank Rt.

Iceland                          Icebank Ltd.

India                            Deutsche Bank AG

                                 The Hongkong and Shanghai
                                 Banking Corporation Limited

Indonesia                        Standard Chartered Bank

Ireland                          Bank of Ireland

Israel                           Bank Hapoalim B.M.



                                      12
<PAGE>


                                                                    SCHEDULE A


                                 STATE STREET
                            GLOBAL CUSTODY NETWORK
                                 SUBCUSTODIANS


Country                          Subcustodian

Italy                            BNP Paribas, Italian Branch

Ivory Coast                      Societe Generale de Banques
                                 en Cote d'Ivoire

Jamaica                          Scotiabank Jamaica Trust and Merchant Bank Ltd.

Japan                            The Fuji Bank, Limited

                                 The Sumitomo Bank, Limited

Jordan                           HSBC Bank Middle East (as delegate of The
                                 Hongkong and Shanghai Banking Corporation
                                 Limited)

Kenya                            Barclays Bank of Kenya Limited

Republic of Korea                The Hongkong and Shanghai Banking Corporation
                                 Limited

Latvia                           A/s Hansabanka

Lebanon                          HSBC Bank Middle East
                                 (as delegate of The Hongkong and Shanghai
                                 Banking Corporation Limited)

Lithuania                        Vilniaus Bankas AB

Malaysia                         Standard Chartered Bank
                                 Malaysia Berhad

Mauritius                        The Hongkong and Shanghai
                                 Banking Corporation Limited

Mexico                           Citibank Mexico, S.A.

Morocco                          Basque Commercials du Maroc

Namibia                          Standard Bank Namibia Limited



                                      13
<PAGE>


                                                                    SCHEDULE A


                                 STATE STREET
                            GLOBAL CUSTODY NETWORK
                                 SUBCUSTODIANS


Country                          Subcustodian

Netherlands                      Fortis Bank (Nederland) N.V.

New Zealand                      ANZ Banking Group
                                 (New Zealand) Limited

Norway                           Christiania Bank og
                                 Kreditkasse ASA

Oman                             HSBC Bank Middle East
                                 (as delegate of The Hongkong and Shanghai
                                 Banking Corporation Limited)

Pakistan                         Deutsche Bank AG

Palestine                        HSBC Bank Middle East
                                 (as delegate of The Hongkong and Shanghai
                                 Banking Corporation Limited)

Panama                           BankBoston, N.A.

Peru                             Citibank, N.A.

Philippines                      Standard Chartered Bank

Poland                           Citibank (Poland) S.A.

Portugal                         Banco Comercial Portugues

Qatar                            HSBC Bank Middle East
                                 (as delegate of The Hongkong and Shanghai
                                 Banking Corporation Limited)

Romania                          ING Bank N.V.

Russia                           Credit Suisse First Boston AO - Moscow
                                 (as delegate of Credit Suisse First Boston -
                                 Zurich)

Singapore                        The Development Bank of Singapore Limited



                                      14
<PAGE>


                                                                    SCHEDULE A


                                 STATE STREET
                            GLOBAL CUSTODY NETWORK
                                 SUBCUSTODIANS


Country                          Subcustodian

Slovak Republic                  Eeskoslovenska Obchodni Banka, A.S.

Slovenia                         Bank Austria Creditanstalt dd. - Ljubljana

South Africa                     Standard Bank of South Africa Limited

Spain                            Banco Santander Central Hispano S.A.

Sri Lanka                        The Hongkong and Shanghai Banking Corporation
                                 Limited

Swaziland                        Standard Bank Swaziland Limited

Sweden                           Skandinaviska Enskilda Banken

Switzerland                      UBS AG

Taiwan - R.O.C.                  Central Trust of China

Thailand                         Standard Chartered Bank

Trinidad & Tobago                Republic Bank Limited

Tunisia                          Banque Internationale Arabe de Tunisie

Turkey                           Citibank, N.A.

Ukraine                          ING Bank Ukraine

United Kingdom                   State Street Bank and Trust Company, London
                                 Branch

Uruguay                          BankBoston, N.A.

Venezuela                        Citibank, N.A.

Vietnam                          The Hongkong and Shanghai Banking Corporation
                                 Limited

Zambia                           Barclays Bank of Zambia Limited



                                      15
<PAGE>


                                                                    SCHEDULE A


                                 STATE STREET
                            GLOBAL CUSTODY NETWORK
                                 SUBCUSTODIANS


Country                          Subcustodian

Zimbabwe                         Barclays Bank of Zimbabwe Limited




                                      16
<PAGE>

                                                                    SCHEDULE B


                                 STATE STREET
                            GLOBAL CUSTODY NETWORK
                   DEPOSITORIES OPERATING IN NETWORK MARKETS


Country                          Depositories

Argentina                        Caja de Valores S.A.

Australia                        Austraclear Limited


                                 Reserve Bank Information and Transfer System

Austria                          Oesterreichische Kontrollbank AG
                                 (Wertpapiersammelbank Division)

Belgium                          Caisse Interprofessionnelle de Depots et de
                                 Virements de Titres, S.A.

                                 Banque Nationale de Belgique

Brazil                           Companhia Brasileira de Liquidacao e Custodia

Bulgaria                         Central Depository AD

                                 Bulgarian National Bank

Canada                           Canadian Depository for Securities Limited

Chile                            Deposito Central de Valores S.A.

People's Republic of China       Shanghai Securities Central Clearing &
                                 Registration Corporation

                                 Shenzhen Securities Central Clearing Co., Ltd.

Colombia                         Deposito Centralizado de Valores

Costa Rica                       Central de Valores S.A.

Croatia                          Ministry of Finance

                                 National Bank of Croatia

                                 Sredisnja Depozitarna Agencija dd.

Czech Republic                   Stredisko cennych papiru

                                 Czech National Bank



                                      17
<PAGE>

                                                                    SCHEDULE B


                                 STATE STREET
                            GLOBAL CUSTODY NETWORK
                   DEPOSITORIES OPERATING IN NETWORK MARKETS


Country                          Depositories

Denmark                          Vaerdipapircentralen (Danish Securities Center)

Egypt                            Misr for Clearing, Settlement, and Depository

Estonia                          Eesti Vaartpaberite Keskdepositoorium

Finland                          Finnish Central Securities Depository

France                           Societe Interprofessionnelle pour la
                                 Compensation des Valeurs Mobilieres

Germany                          Clearstream Banking AG, Frankfurt

Greece                           Bank of Greece, System for Monitoring
                                 Transactions in Securities in Book-Entry Form

                                 Central Securities Depository (Apothetirion
                                 Titlon AE)

Hong Kong                        Central Clearing and Settlement System

                                 Central Moneymarkets Unit

Hungary                          Kozponti Elszamolohaz es Ertektar

                                 (Budapest) Rt. (KELER)

India                            National Securities Depository Limited

                                 Central Depository Services India Limited

                                 Reserve Bank of India

Indonesia                        Bank Indonesia

                                 PT Kustodian Sentral Efek Indonesia

Ireland                          Central Bank of Ireland
                                 Securities Settlement Office



                                      18
<PAGE>

                                                                    SCHEDULE B


                                 STATE STREET
                            GLOBAL CUSTODY NETWORK
                   DEPOSITORIES OPERATING IN NETWORK MARKETS


Country                          Depositories

Israel                           Tel Aviv Stock Exchange Clearing House Ltd.
                                 (TASE Clearinghouse)

Italy                            Monte Titoli S.p.A.

                                 Banca d'Italia

Ivory Coast                      Depositaire Central - Banque de Reglement

Jamaica                          Jamaica Central Securities Depository

Japan                            Japan Securities Depository Center (JASDEC)
                                 Bank of Japan Net System

Kenya                            Central Bank of Kenya

Republic of Korea                Korea Securities Depository

Latvia                           Latvian Central Depository

Lebanon                          Custodian and Clearing Center of Financial
                                 Instruments for Lebanon and the Middle East
                                 (Midclear) S.A.L.

                                 Banque du Liban

Lithuania                        Central Securities Depository of Lithuania

Malaysia                         Malaysian Central Depository Sdn. Bhd.

                                 Bank Negara Malaysia, Scripless Securities
                                 Trading and Safekeeping System

Mauritius                        Central Depository and Settlement Co. Ltd.

                                 Bank of Mauritius

Mexico                           S.D. INDEVAL
                                 (Instituto para el Deposito de Valores)

Morocco                          Maroclear



                                      19
<PAGE>

                                                                    SCHEDULE B


                                 STATE STREET
                            GLOBAL CUSTODY NETWORK
                   DEPOSITORIES OPERATING IN NETWORK MARKETS


Country                          Depositories

Netherlands                      Nederlands Centraal Instituut voor Giraal
                                 Effectenverkeer B.V. (NECIGEF)

New Zealand                      New Zealand Central Securities Depository
                                 Limited

Norway                           Verdipapirsentralen (Norwegian Central
                                 Securities Depository)

Oman                             Muscat Depository & Securities Registration
                                 Company, SAOC

Pakistan                         Central Depository Company of Pakistan Limited

                                 State Bank of Pakistan

Palestine                        Clearing Depository and Settlement, a
                                 department of the Palestine Stock Exchange

Peru                             Caja de Valores y Liquidaciones, lnstitucion
                                 de Compensation y Liquidation de Valores S.A

Philippines                      Philippine Central Depository, Inc.

                                 Registry of Scripless Securities (ROSS) of the
                                 Bureau of Treasury

Poland                           National Depository of Securities (Krajowy
                                 Depozyt Papierow Wartooeciowych SA)

                                 Central Treasury Bills Registrar

Portugal                         Central de Valores Mobiliarios

Qatar                            Central Clearing and Registration (CCR), a
                                 department of the Doha Securities Market

Romania                          National Securities Clearing, Settlement and
                                 Depository Company



                                      20
<PAGE>

                                                                    SCHEDULE B


                                 STATE STREET
                            GLOBAL CUSTODY NETWORK
                   DEPOSITORIES OPERATING IN NETWORK MARKETS


Country                          Depositories

                                 Bucharest Stock Exchange Registry Division

                                 National Bank of Romania

Singapore                        Central Depository (Pte) Limited

                                 Monetary Authority of Singapore

Slovak Republic                  Stredisko cennych papierov

                                 National Bank of Slovakia

Slovenia                         Klirinsko Depotna Druzba dd.

South Africa                     Central Depository Limited

                                 Share Transactions Totally Electronic (STRATE)
                                 Ltd.

Spain                            Servicio de Compensacion y Liquidacion de
                                 Valores, S.A.

                                 Banco de Espana, Central de Anotaciones en
                                 Cuenta

Sri Lanka                        Central Depository System (Pvt) Limited

Sweden                           Vardepapperscentralen VPC AB
                                 (Swedish Central Securities Depository)

Switzerland                      SegaIntersettle AG (SIS)

Taiwan - R.O.C.                  Taiwan Securities Central Depository Co., Ltd.

Thailand                         Thailand Securities Depository Company Limited

Tunisia                          Societe Tunisienne Interprofessionelle pour la
                                 Compensation et de Depots des Valeurs
                                 Mobilieres

Turkey                           Takas ve Saklama Bankasi A.(a). (TAKASBANK)

                                 Central Bank of Turkey



                                      21
<PAGE>

                                                                    SCHEDULE B


                                 STATE STREET
                            GLOBAL CUSTODY NETWORK
                   DEPOSITORIES OPERATING IN NETWORK MARKETS


Country                          Depositories

Ukraine                          National Bank of Ukraine

United Kingdom                   Central Gilts Office and Central Moneymarkets
                                 Office

Venezuela                        Banco Central de Venezuela

Zambia                           LuSE Central Shares Depository Limited

                                 Bank of Zambia

TRANSNATIONAL

Euroclear

Clearstream Banking AG







                                      22
<PAGE>

                                  SCHEDULE C

                              MARKET INFORMATION



Publication/Type of Information                 Brief Description
- -------------------------------                 -----------------
          (Frequency)

The Guide to Custody in          An overview of safekeeping and settlement
World Markets                    practices and procedures in each market in
- -------------                    which State Street Bank and Trust Company
(annually)                       offers custodial services.

Global Custody Network Review    Information relating to the operating history
- -----------------------------    and structure of depositories and
(annually)                       subcustodians located in the markets in which
                                 State Street Bank and Trust Company offers
                                 custodial services, including transnational
                                 depositories.

Global Legal Survey              With respect to each market in which State
- -------------------              Street Bank and Trust Company offers custodial
(annually)                       services, opinions relating to whether local
                                 law restricts (i) access of a fund's
                                 independent public accountants to books and
                                 records of a Foreign Sub-Custodian or Foreign
                                 Securities System, (ii) the Fund's ability to
                                 recover in the event of bankruptcy or
                                 insolvency of a Foreign Sub-Custodian or
                                 Foreign Securities System, (iii) the Fund's
                                 ability to recover in the event of a loss by
                                 a Foreign Sub-Custodian or Foreign Securities
                                 System, and (iv) the ability of a foreign
                                 investor to convert cash and cash equivalents
                                 to U.S. dollars.

Subcustodian Agreements          Copies of the subcustodian contracts State
- -----------------------          Street Bank and Trust Company has entered into
(annually)                       with each subcustodian in the markets in
                                 which State Street Bank and Trust Company
                                 offers subcustody services to its US mutual
                                 fund clients.

Network Bulletins                Developments of interest to investors in the
(weekly):                        markets in which State Street Bank and Trust
                                 Company offers custodial services.

Foreign Custody Advisories       With respect to markets in which State Street
(as necessary):                  Bank and Trust Company offers custodial
                                 services which exhibit special custody risks,
                                 developments which may impact State Street's
                                 ability to deliver expected levels of
                                 service.





                                      23

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.J7
<SEQUENCE>18
<FILENAME>efc2-1398_exhibitj7.txt
<TEXT>
                                                                Exhibit (j)(7)



                               AMENDMENT TO THE
                              CUSTODIAN CONTRACT


     AGREEMENT made this ____ day of January, 2003 by and between STATE STREET
BANK AND TRUST COMPANY ("Custodian") and ROYCE VALUE TRUST, INC. (the "Fund").

                               WITNESSETH THAT:

     WHEREAS, the Custodian and the Fund are parties to a Custodian Contract
dated October 20, 1986 (as amended to date, the "Contract") which governs the
terms and conditions under which the Custodian maintains custody of the
securities and other assets of the Fund:

     NOW THEREFORE, the Custodian and the Fund hereby amend the terms of the
Custodian Contract and mutually agree to the following:

     Replace in its entirety Section 2.15 Proper Instructions with the
following new Section 2.15:

          2.15) Proper Instructions. Proper Instructions as used throughout
          this Article 2 means a writing signed or initialed by two or more
          persons as the Board of Directors shall have from time to time
          authorized. Each such writing shall set forth the specific
          transaction or type of transaction involved, including a specific
          statement of the purpose for which such action is requested. Oral
          instructions will be considered Proper Instructions if the Custodian
          reasonably believes them to have been given by a person authorized
          to give such instructions with respect to the transaction involved.
          The Fund shall cause all oral instructions to be confirmed in
          writing by two or more persons as the Board of Directors shall have
          from time to time authorized. Upon receipt of a certificate of the
          Secretary or an Assistant Secretary as to the authorization by the
          Board of Directors of the Fund accompanied by a detailed description
          of procedures approved by the Board of Directors, Proper
          Instructions may include communications effected directly between
          electro-mechanical or electronic devices, provided that the Board of
          Directors and the Custodian are satisfied that such procedures
          afford adequate safeguards for the Fund's assets.

     IN WITNESS WHEREOF, each of the parties have caused this Amendment to be
executed in its name and on its behalf by a duly authorized officer as of the
day and year first above written.

ATTEST                                  ROYCE VALUE TRUST, INC.

________________________________        ____________________________________
ATTEST                                  STATE STREET BANK AND TRUST COMPANY

________________________________        ____________________________________
Assistant Secretary                               Vice President

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.K1
<SEQUENCE>19
<FILENAME>efc2-1398_exhibitk1.txt
<TEXT>
                                                                EXHIBIT (k)(1)

                                  REGISTRAR,
                     TRANSFER AGENCY AND SERVICE AGREEMENT

                                    between

                            ROYCE VALUE TRUST, INC.

                                      and

                      STATE STREET BANK AND TRUST COMPANY


<PAGE>



                               TABLE OF CONTENTS

                                                                          Page

Article 1  Terms of Appointment; Duties of the Bank..........................1

Article 2  Fees and Expenses.................................................2

Article 3  Representations and Warranties of the Bank........................3

Article 4  Representations and Warranties of the Fund........................4

Article 5  Indemnification...................................................4

Article 6  Covenants of the Fund and the Bank................................7

Article 7  Termination of Agreement..........................................8

Article 8  Assignment........................................................8

Article 9  Amendment.........................................................9

Article 10 Massachusetts Law to Apply........................................9

Article 11 Merger of Agreement...............................................9







<PAGE>

               REGISTRAR, TRANSFER AGENCY AND SERVICE AGREEMENT

            AGREEMENT made as of the 20th day of October , 1986, by and
between ROYCE VALUE TRUST, INC., a Maryland corporation, having its principal
office and place of business at 1414 Avenue of the Americas, 9th Floor, New
York, New York 10019, (the "Fund"), and STATE STREET BANK AND TRUST COMPANY, a
Massachusetts corporation having its principal office and place of business at
225 Franklin Street, Boston, Massachusetts 02110 (the "Bank").

            WHEREAS, the Fund desires to appoint the Bank as its registrar,
transfer agent, dividend disbursing agent and agent in connection with certain
other activities and the Bank desires to accept such appointment;

            NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:

Article 1   Terms of Appointment; Duties of the Bank

            1.01  Subject to the terms and conditions set forth in this
Agreement, the Fund hereby employs and appoints the Bank to act as, and the
Bank agrees to act as registrar, transfer agent for the Fund's authorized and
issued shares of its common stock ("Shares"), dividend disbursing agent and
agent in connection with any dividend reinvestment as set out in the currently
effective prospectus of the Fund.

            1.02  The Bank agrees that it will perform the following services:

            (a)   In accordance with procedures established from time to time
by agreement between the Fund and the Bank, the Bank shall:

                  (i)   issue and record the appropriate number of Shares and
                        hold such Shares in the appropriate Shareholder
                        account;
<PAGE>

                  (ii)  effect transfers of Shares by the registered owners
                        thereof upon receipt of appropriate documentation;

                  (iii) prepare and transmit payments for dividends and
                        distributions declared by the Fund; and

                  (iv)  act as agent for Shareholders pursuant to the dividend
                        reinvestment and cash purchase plan, as amended from
                        time to time.

            (b)   In addition to and not in lieu of the services set forth in
the above paragraph (a), the Bank shall: (i) perform all of the customary
services of a registrar, transfer agent, dividend disbursing agent and agent
of the dividend reinvestment and cash purchase plan as described in Article 1,
consistent with those regulations in effect from time to time. The detailed
definition, frequency, limitations and associated costs (if any) set out in
the attached fee schedule, include but are not limited to: maintaining all
Shareholder accounts, preparing Shareholder meeting lists, mailing proxies,
receiving and tabulating proxies and mailing Shareholder reports to current
Shareholders, withholding taxes on U.S. resident and non-resident alien
accounts where applicable, preparing and filing U.S. Treasury Department Forms
1099 and other appropriate forms required with respect to dividends sad
distributions by federal authorities for all registered Shareholders,
preparing and mailing confirmation forms and statements of account to
Shareholders for all confirmable transactions in Shareholder accounts, and
providing Shareholder account information.

Article 2   Fees and Expenses

            2.01  For the performance by the Bank pursuant to this Agreement,
the Fund agrees to pay the Bank an annual maintenance fee as set out in the
initial fee schedule attached hereto. Such fees and out-of-pocket expenses and
advances identified under Section 2.02 below

                                     -2-
<PAGE>

may be changed from time to time subject to mutual written agreement between
the Fund and the Bank.

            2.02  In addition to the fee paid under Section 2.01 above, the
Fund agrees to reimburse the Bank for out-of-pocket expenses or advances
incurred by the Bank for the items set out in the fee schedule attached
hereto. In addition, any other expenses incurred by the Bank at the request or
with the consent of the Fund, will be reimbursed by the Fund.

            2.03  The Fund agrees to pay all fees and reimbursable expenses
within five days following the mailing of the respective billing notice.
Postage and the cost of materials for mailing of dividends, proxies, Fund
reports and other mailings to all Shareholder accounts shall be advanced to
the Bank by the Fund at least seven (7) days prior to the mailing date of such
materials.

Article 3   Representations and Warranties of the Bank

            The Bank represents and warrants to the Fund that:

            3.01  It is a corporation duly organized and existing and in good
standing under the laws of the Commonwealth of Massachusetts.

            3.02  It is duly qualified to carry on its business in the
Commonwealth of Massachusetts.

            3.03  It is empowered under applicable laws and by its charter and
by-laws to enter into and perform this Agreement.

            3.04  All requisite corporate proceedings have been taken to
authorize it to enter into and perform this Agreement.

            3.05  It has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and obligations
under this Agreement.

                                     -3-
<PAGE>

Article 4   Representations and Warranties of the Fund

            The Fund represents and warrants to the Bank that:

            4.01  It is a corporation duly organized and existing and in good
standing under the laws of Maryland.

            4.02  It is empowered under applicable laws and by its Articles of
Incorporation and By-Laws to enter into and perform this Agreement.

            4.03  All corporate proceedings required by said Articles of
Incorporation and By-Laws have been taken to authorize it to enter into and
perform this Agreement.

            4.04  It is a closed-end, diversified investment company
registered under the Investment Company Act of 1940.

            4.05  A registration statement under the Securities Act of 1933 is
or will be currently effective and appropriate state securities law filings
have been or will be made with respect to all Shares of the Fund being offered
for sale; information to the contrary will result in immediate notification to
the Bank.

            4.06  It shall make all required filings under federal and state
securities laws.

Article 5   Indemnification

            5.01  The Bank shall not be responsible for, and the Fund shall
indemnify and hold the Bank harmless from and against, any and all losses,
damages, costs, charges, counsel fees, payments, expenses and liability
arising out of or attributable to:

            (a)   All actions of the Bank or its agents or subcontractors
required to be taken pursuant to this Agreement, provided that such actions
are taken in good faith and without negligence or willful misconduct.

                                     -4-
<PAGE>

            (b)   The Fund's refusal or failure to comply with the terms of
this Agreement, or which arise out of the Fund's lack of good faith,
negligence or willful misconduct or which arise out of the breach of any
representation or warranty of the Fund hereunder.

            (c)   The reliance on or use by the Bank or its agents or
subcontractors of information, records and documents which (i) are received by
the Bank or its agents or subcontractors and furnished to it by or on behalf
of the Fund, and (ii) have been prepared and/or maintained by the Fund or any
other person or firm on behalf of the Fund.

            (d)   The reliance on, or the carrying out by the Bank or its
agents or subcontractors of any instructions or requests of the Fund's
representative.

            (e)   The offer or sale of Shares in violation of any requirement
under the federal securities laws or regulations or the securities laws or
regulations of any state that such Shares be registered in such state or in
violation of any stop order or other determination or ruling by any federal
agency or any state with respect to the offer or sale of such Shares in such
state.

            5.02  The Bank shall indemnify and hold the Fund harmless from and
against any and all losses, damages, costs, charges, counsel fees, payments,
expenses and liability arising out of or attributable to any action or failure
or omission to act by the Bank as a result of the Bank's lack of good faith,
negligence or willful misconduct.

            5.03  At any time the Bank may apply to any officer of the Fund
for instructions, and may consult with legal counsel with respect to any
matter arising in connection with the services to be performed by the Bank
under this Agreement, and the Bank and its agents or subcontractors shall not
be liable and shall be indemnified by the Fund for any action taken or omitted
by it in reliance upon such instructions or upon the opinion of such counsel.
The Bank,

                                     -5-
<PAGE>

its agents and subcontractors shall be protected and indemnified in
acting upon any paper or document furnished by or on behalf of the Fund,
reasonably believed to be genuine and to have been signed by the proper person
or persons, or upon any instruction, information, data, records or documents
provided the Bank or its agents or subcontractors by telephone, in person,
machine readable input, telex, CRT data entry or other similar means
authorized by the Fund, and shall not be held to have notice of any change of
authority of any person, until receipt of written notice thereof from the
Fund. The Bank, its agents and subcontractors shall also be protected and
indemnified in recognizing stock certificates which are reasonably believed to
bear the proper manual or facsimile signatures of the officers of the Fund,
and the proper countersignature of any former transfer agent or former
registrar, or of a co-transfer agent or co-registrar.

            5.04  In the event either party is unable to perform its
obligations under the terms of this Agreement because of acts of God, strikes,
equipment or transmission failure or damage reasonably beyond its control, or
other causes reasonably beyond its control, such party shall not be liable for
damages to the other for any damages resulting from such failure to perform or
otherwise from such causes.

            5.05  In order that the indemnification provisions, contained in
this Article 5 shall apply, upon the assertion of a claim for which either
party may be required to indemnify the other, the party seeking
indemnification shall promptly notify the other party of such assertion, and
shall keep the other party advised with respect to all developments concerning
such claim. The party who may be required to indemnify shall have the option
to participate with the party seeking indemnification in the defense of such
claim. The party seeking indemnification shall in no case confess any claim or
make any compromise in any case in which the other party may be required to
indemnify it except with the other party's prior written consent.

                                     -6-
<PAGE>

Article 6   Covenants of the Fund and the Bank

            6.01  The Fund shall promptly furnish to the Bank the following:

            (a)   A certified copy of the resolution of the Board of Directors
of the Fund authorizing the appointment of the Bank and the execution and
delivery of this Agreement.

            (b)   A copy of the Articles of Incorporation and By-Laws of the
Fund and all amendments thereto.

            6.02  The Bank hereby agrees to establish and maintain facilities
and procedures reasonably acceptable to the Fund for safekeeping of stock
certificates, check forms and facsimile signature imprinting devices, if any;
and for the preparation or use, and for keeping account of, such certificates,
forms and devices.

            6.03  The Bank shall keep records relating to the services to be
performed hereunder, in the form and manner as it may deem advisable. To the
extent required by Section 31 of the Investment Company Act of 1940, as
amended, and the Rules thereunder, the Bank agrees that all such records
prepared or maintained by the Bank relating to the services to be performed by
the Bank hereunder are the property of the Fund and will be preserved,
maintained and made available in accordance with such Section and Rules, and
will be surrendered promptly to the Fund on and in accordance with its
request.

            6.04  The Bank and the Fund agree that all books, records,
information and data pertaining to the business of the other party which are
exchanged or received pursuant to the negotiation or the carrying out of this
Agreement shall remain confidential, and shall not be voluntarily disclosed to
any other person, except as may be required by law.

            6.05  In case of any requests or demands for the inspection of the
Shareholder records of the Fund, the Bank will endeavor to notify the Fund and
to secure instructions from an

                                     -7-
<PAGE>

authorized officer of the Fund as to such inspection. The Bank reserves the
right, however, to exhibit the Shareholder records to any person whenever it
is advised by its counsel that it may be held liable for the failure to
exhibit the Shareholder records to such person.

Article 7   Termination of Agreement

            7.01  This Agreement may be terminated by either party upon
one-hundred twenty (120) days written notice to the other.

            7.02  Should the Fund exercise its right to terminate, all
out-of-pocket expenses associated with the movement of records and material
will be borne by the Fund. Additionally, the Bank reserves the right to charge
for any other reasonable expenses associated with such termination.

Article 8   Assignment

            8.01  Except as provided in Section 8.03 below, neither this
Agreement nor any rights or obligations hereunder may be assigned by either
party without the written consent of the other party.

            8.02  This Agreement shall inure to the benefit of and be binding
upon the parties and their respective permitted successors and assigns.

            8.03  The Bank may, without further consent on the part of the
Fund, subcontract for the performance hereof with (i) Boston Financial Data
Services, Inc., a Massachusetts corporation ("BFDS") which is duly registered
as a transfer agent pursuant to Section 17A(c)(1) of the Securities Exchange
Act of 1934 ("Section 17A(c)(1)"), or (ii) a BFDS subsidiary duly registered
as a transfer agent pursuant to Section 17A(c)(1); provided, however, that the
Bank shall be as fully responsible to the Fund for the acts and omissions of
any subcontractor as it is for its own acts and omissions.

                                     -8-
<PAGE>

Article 9   Amendment

            9.01  This Agreement may be amended or modified by a written
agreement executed by both parties and authorized or approved by a resolution
of the Board of Directors of the Fund.

Article 10  Massachusetts Law to Apply

            10.01 This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of the Commonwealth of
Massachusetts.

Article 11  Merger of Agreement

            11.01 This Agreement constitutes the entire agreement between the
parties hereto and supersedes any prior agreement with respect to the subject
hereof whether oral or written.


                                     -9-
<PAGE>

            IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed in their names and on their behalf under their seals by and
through their duly authorized officers, as of the day and year first above
written.



                                   ROYCE VALUE TRUST, INC.



                                   BY:
                                      ----------------------------------------



ATTEST:



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


                                   STATE STREET BANK AND TRUST COMPANY



                                   BY:
                                      ----------------------------------------
                                                   Vice President



ATTEST:



- -------------------------------------
          Assistant Secretary


                                     -10-


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.K2
<SEQUENCE>20
<FILENAME>efc2-1398_exhibitk2.txt
<TEXT>
                                                                EXHIBIT (k)(2)










                                  REGISTRAR,

                 TRANSFER AGENCY AND PAYING AGENCY AGREEMENT

                                    between

                            Royce Value Trust, Inc.

                                      and

                      State Street Bank and Trust Company













<PAGE>



                               TABLE OF CONTENTS


Article 1  Terms of Appointment; Duties of the Bank..........................1

Article 2  Fees and Expenses.................................................3

Article 3  Representations and Warranties of the Bank........................4

Article 4  Representations and Warranties of the Fund........................4

Article 5  Confidentiality, Data Access and Proprietary Information..........5

Article 6  Liabilities/Indemnification.......................................7

Article 7  Standard of Care..................................................9

Article 8  Covenants of the Fund and the Bank................................9

Article 9  Termination of Agreement.........................................10

Article 10 Assignment.......................................................10

Article 11 Amendment........................................................11

Article 12 Massachusetts Law to Apply.......................................11

Article 13 Force Majeure....................................................11

Article 14 Consequential Damages............................................12

Article 15 Merger of Agreement..............................................12

Article 16 Survival.........................................................12

Article 17 Severability.....................................................12

Article 18 Counterparts.....................................................12





<PAGE>




            REGISTRAR, TRANSFER AGENCY AND PAYING AGENCY AGREEMENT

            AGREEMENT made as of August 21, 1996, by and between Royce Value
Trust, Inc. having its principal office and place of business at 1414 Avenue
of the Americas, New York, NY 10019, (the "Fund"), and STATE STREET BANK AND
TRUST COMPANY, a Massachusetts trust company having its principal office and
place of business at 225 Franklin Street, Boston, Massachusetts 02110 (the
"Bank").

            WHEREAS, the Fund desires to appoint the Bank as its registrar,
transfer agent, dividend paying agent and agent in connection with the payment
of any redemption or liquidation proceeds related to the Cumulative Preferred
Stock and the Bank desires to accept such appointment;

            NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:

Article 1   Terms of Appointment; Duties of the Bank

            1.01  Subject to the terms and conditions set forth in this
Agreement, the Fund hereby employs and appoints the Bank to act as, and the
Bank agrees to act as registrar, transfer agent for the Fund's authorized and
issued shares of its Cumulative Preferred Stock ("Shares"), dividend paying
agent and agent in connection with the payment of any redemption or
liquidation proceeds as set out in the prospectus of the Fund, corresponding
to the date of this Agreement.

            1.02  The Bank agrees that it will perform the following services:

            (a)   In accordance with procedures established from time to time
by agreement between the Fund and the Bank, the Bank shall:

<PAGE>

                  (i) Issue and record the appropriate number of Shares as
                  authorized and hold such Shares in the appropriate
                  Stockholder account;

                  (ii) Effect transfers of Shares by the registered owners
                  thereof upon receipt of appropriate documentation;

                  (iii) Prepare and transmit payments for dividends and
                  distributions declared by the Fund;

                  (iv) Prepare and transmit payments in connection with the
                  redemption of shares or the payment of liquidation proceeds
                  pursuant to instructions by the Fund;

                  (v) Issue replacement certificates for those certificates
                  alleged to have been lost, stolen or destroyed upon receipt
                  by the Bank of indemnification satisfactory to the Bank and
                  protecting the Bank and the Fund, and the Bank at its
                  option, may issue replacement certificates in place of
                  mutilated stock certificates upon presentation thereof and
                  without such indemnity.

            (b)   In addition to and neither in lieu nor in contravention of
the services set forth in the above paragraph (a), the Bank shall: (i) perform
all of the customary services of a registrar, transfer agent and dividend
paying agent as described in Article 1 consistent with those requirements in
effect as of the date of this Agreement. The detailed definition, frequency,
limitations and associated costs (if any) set out in the attached fee
schedule, include but are not limited to: maintaining all Stockholder
accounts, preparing Stockholder meeting lists, mailing proxies, receiving and
tabulating proxies and mailing Stockholder reports to current Stockholders,
withholding taxes on U. S. resident and non-resident alien accounts where
applicable, preparing and filing U.S. Treasury Department Forms 1099 and other
appropriate

                                      2
<PAGE>

forms required with respect to dividends and distributions by federal
authorities for all registered Stockholders, preparing and mailing
confirmation forms and statements of account to Stockholders for all
confirmable transactions in Stockholder accounts, and providing Stockholder
Account information.

            (c)   The Bank shall provide additional services on behalf of the
Fund (e.g., escheatment services) which may be agreed upon in writing between
the Fund and the Bank.

Article 2   Fees and Expenses

            2.01  For the performance by the Bank pursuant to this Agreement,
the Fund agrees to pay the Bank an annual maintenance fee as set out in the
initial fee schedule attached hereto. Such fees and out-of-pocket expenses and
advances identified under Section 2.02 below may be changed from time to time
subject to mutual written agreement between the Fund and the Bank.

            2.02  In addition to the fee paid under Section 2.01 above, the
Fund agrees to reimburse the Bank for out-of-pocket expenses, including but
not limited to confirmation production, postage, forms, telephone, microfilm,
microfiche, tabulating proxies, records storage, or advances incurred by the
Bank for the items set out in the fee schedule attached hereto. In addition,
any other expenses incurred by the Bank at the request or with the consent of
the Fund, will be reimbursed by the Fund.

            2.03  The Fund agrees to pay all fees and reimbursable expenses
within five days following the receipt of the respective billing notice.
Postage and the cost of materials for mailing of dividends, proxies, Fund
reports and other mailings to all Stockholder accounts shall be advanced to
the Bank by the Fund at least seven (7) days prior to the mailing date of such
materials.

                                      3
<PAGE>

Article 3   Representations and Warranties of the Bank

            The Bank represents and warrants to the Fund that:

            3.01  It is a trust company duly organized and existing and in
good standing under the laws of the Commonwealth of Massachusetts.

            3.02  It is duly qualified to carry on its business in the
Commonwealth of Massachusetts.

            3.03  It is empowered under applicable laws and by its Charter and
By-Laws to enter into and perform this Agreement.

            3.04  All requisite corporate proceedings have been taken to
authorize it to enter into and perform this Agreement.

            3.05  It has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and obligations
under this Agreement.

Article 4   Representations and Warranties of the Fund

            The Fund represents and warrants to the Bank that:

            4.01  It is a corporation duly organized and existing and in good
standing under the laws of the State of Maryland.

            4.02  It is empowered under applicable laws and by its Articles of
Incorporation, as amended and By-Laws to enter into and perform this
Agreement.

            4.03  A11 corporate proceedings required by said Articles of
Incorporation, as amended and By-Laws have been taken to authorize it to enter
into and perform this Agreement.

            4.04  It is a closed-end, diversified investment company
registered under the Investment Company Act of 1940, as amended.

            4.05  To the extent required by federal securities laws a
registration statement under the Securities Act of 1933, as amended is
currently effective and appropriate state

                                      4
<PAGE>

securities law filings have been made with respect to all Shares of the Fund
being offered for sale; information to the contrary will result in immediate
notification to the Bank.

            4.06  It shall make all required filings under federal and state
securities laws.

Article 5   Confidentiality, Data Access and Proprietary Information

            5.01  The Fund acknowledges that the data bases, computer
programs, screen formats, report formats, interactive design techniques, and
other information furnished to the Fund by the Bank are provided solely in
connection with the services rendered under this Agreement and constitute
copyrighted secrets or proprietary information of substantial value to the
Bank. Such databases, programs, formats, designs, techniques and other
information are collectively referred to below as "Proprietary Information."
The Fund agrees that it shall treat all Proprietary Information as proprietary
to the Bank and further agrees that is shall not divulge any Proprietary
Information to any person or organization except as expressly permitted
hereunder. The Fund agrees for itself and its employees and agents:

            (a) to use such programs and databases (i) solely on the Fund
            computers, or (ii) solely from equipment at the locations agreed
            to between the Fund and the Bank and (iii) in accordance with the
            Bank's applicable user documentation;

            (b) to refrain from copying or duplicating in any way (other than
            in the normal course of performing processing on the Funds'
            computers) any part of any Proprietary Information;

            (c) to refrain from obtaining unauthorized access to any programs,
            data or other information not owned by the Fund, and if such
            access is accidentally obtained, to respect and safeguard the same
            Proprietary Information;

            (d) to refrain from causing or allowing information transmitted
            from the Bank's computer to the Funds' terminal to be
            retransmitted to any other computer

                                      5
<PAGE>

            terminal or other device except as expressly permitted by the Bank,
            (such permission not to be unreasonably withheld);

            (e) that the Fund shall have access only to those authorized
            transactions as agreed to between the Fund and the Bank; and

            (f) to honor reasonable written requests made by the Bank to
            protect at the Bank's expense the rights of the Bank in
            Proprietary Information at common law and under applicable
            statues.

            5.02  If the transactions available to the Fund include the
ability to originate electronic instructions to the Bank in order to (i)
effect the transfer or movement of cash or Shares or (ii) transmit Shareholder
information or other information, then in such event the Bank shall be
entitled to rely on the validity and authenticity of such instruction without
undertaking any further inquiry as long as such instruction is undertaken in
conformity with security procedures established by the Bank from time to time.

            5.03  The Bank acknowledges that the indentities of the Fund's
Stockholders and information maintained by the Bank regarding the Fund's
Stockholders constitute the valuable property of the Fund. The Bank agrees
that if it should come into possession of any list or compilation of the
indentities of, or other information about the Fund's Stockholders pursuant to
this Agreement or any other agreement related to services under this
Agreement, the Bank shall hold such information in confidence and refrain from
using, disclosing or distributing such information except as required to
perform its duties under this Agreement or as may be otherwise required by
law.

                                      6
<PAGE>

Article 6   Liabilities/Indemnification

            6.01  The Bank shall not be responsible for, and the Fund shall
indemnify and hold the Bank harmless from and against, any and all losses,
damages, costs, charges, counsel fees, payments, expenses and liability
arising out of or attributable to:

            (a)   All actions of the Bank or its agents or subcontractors
required to be taken pursuant to this Agreement, provided that such actions
are taken in good faith and without negligence or willful misconduct.

            (b)   The Fund's lack of good faith, negligence or willful
misconduct which arise out of the breach of any representation or warranty of
the Fund hereunder.

            (c)   The reliance on or use by the Bank or its agents or
subcontractors of information, records, documents or services which (i) are
received by the Bank or its agents or subcontractors, and (ii) have been
prepared, maintained or performed by the Fund or any other person or firm on
behalf of the Fund including but not limited to any previous transfer agent
registrar.

            (d)   The reliance on, or the carrying out by the Bank or its
agents or subcontractors of any instructions or requests of the Fund.

            (e)   The offer or sale of Shares in violation of any requirement
under the federal securities laws or regulations or the securities laws or
regulations of any state that such Shares be registered in such state or in
violation of any stop order or other determination or ruling by any federal
agency or any state with respect to the offer or sale of such Shares in such
state.

            6.02  The Bank shall indemnify and hold the Fund harmless from and
against any and all losses, damages, costs, charges, counsel fees, payments,
expenses and liability arising

                                      7
<PAGE>

out of or attributable to any action or failure or omission to act by the Bank
as a result of the Bank's lack of good faith, negligence or willful
misconduct.

            6.03  At any time the Bank may apply to any officer of the Fund
for instructions, and may consult with legal counsel with respect to any
matter arising in connection with the services to be performed by the Bank
under this Agreement, and the Bank and its agents or subcontractors shall not
be liable and shall be indemnified by the Fund for any action taken or omitted
by it in reliance upon such instructions or upon the opinion of such counsel.
The Bank, its agents and subcontractors shall be protected and indemnified in
acting upon any paper or document furnished by or on behalf of the Fund,
reasonably believed to be genuine and to have been signed by the proper person
or persons, or upon any instruction, information, data, records or documents
provided the Bank or its agents or subcontractors by telephone, in person,
machine readable input, telex, CRT data entry or other similar means
authorized by the Fund, and shall not be held to have notice of any change of
authority of any person, until receipt of written notice thereof from the
Fund. The Bank, its agents and subcontractors shall also be protected and
indemnified in recognizing stock certificates which are reasonably believed to
bear the proper manual or facsimile signatures of the officers of the Fund,
and the proper countersignature of any former transfer agent or former
registrar, or of a co-transfer agent or co-registrar.

            6.04  In order that the indemnification provisions contained in
this Article 6 shall apply, upon the assertion of a claim for which either
party may be required to indemnify the other, the party seeking
indemnification shall promptly notify the other party of such assertion, and
shall keep the other party advised with respect to all developments concerning
such claim. The party who may be required to indemnify shall have the option
to participate with the party seeking indemnification in the defense of such
claim or to defend against said claim in its own

                                      8
<PAGE>

name or in the name of the party seeking indemnification. The party seeking
indemnification shall in no case confess any claim or make any compromise in
any case in which the other party may be required to indemnify it except with
the other party's prior written consent.

Article 7   Standard of Care

            7.01  The Bank shall at all times act in good faith and agrees to
use its best efforts within reasonable limits to insure the accuracy of all
services performed under this Agreement, but assumes no responsibility and
shall not be liable for loss or damage due to errors unless said errors are
caused by its and/or its employee's negligence, bad faith, or willful
misconduct.

Article 8   Covenants of the Fund and the Bank

            8.01  The Fund shall promptly furnish to the Bank the following:

            (a)   A certified copy of the resolution of the Board of Directors
of the Fund authorizing the appointment of the Bank and the execution and
delivery of this Agreement.

            (b)   A copy of the Articles of Incorporation, as amended and
By-Laws of the Fund and all amendments thereto.

            8.02  The Bank hereby agrees to establish and maintain facilities
and procedures reasonably acceptable to the Fund for safekeeping of stock
certificates, check forms and facsimile signature imprinting devices, if any;
and for the preparation or use, and for keeping account of, such certificates,
forms and devices.

            8.03  The Bank shall keep records relating to the services to be
performed hereunder, in the form and manner as it may deem advisable. To the
extent required by Section 31 of the Investment Company Act of 1940, as
amended, and the Rules thereunder, the Bank agrees that all such records
prepared or maintained by the Bank relating to the services to be performed by
the Bank hereunder are the property of the Fund and will be preserved,
maintained

                                      9
<PAGE>

and made available in accordance with such Section and Rules, and
will be surrendered promptly to the Fund on and in accordance with its
request.

            8.04  The Bank and the Fund agree that all books, records,
information and data pertaining to the business of the other party which are
exchanged or received pursuant to the negotiation or the carrying out of this
Agreement shall remain confidential, and shall not be voluntarily disclosed to
any other person, except as may be required by law.

            8.05  In cases of any requests or demands for the inspection of
the Shareholder records of the Fund, the Bank will endeavor to notify the Fund
and to secure instructions from an authorized officer of the Fund as to such
inspection. The Bank reserves the right, however, to exhibit the Shareholder
records to any person whenever it is advised by its counsel that it may be
held liable for the failure to exhibit the Shareholder records to such person.

Article 9   Termination of Agreement

            9.01  This Agreement may be terminated by either party upon one
hundred twenty (120) days written notice to the other.

            9.02  Should the Fund exercise its right to terminate, all
out-of-pocket expenses associated with the movement of records and material
will be borne by the Fund. Additionally, the Bank reserves the right to charge
for any other reasonable expenses associated with such termination and under
review by Boston EquiServe or a charge equivalent to the average of three (3)
month's fees.

Article 10  Assignment

            10.01 Except as provided in Section 10.03 below, neither this
Agreement nor any rights or obligations hereunder may be assigned by either
party without the written consent of the other party.

                                      10
<PAGE>

            10.02 This Agreement shall inure to the benefit of and be binding
upon the parties and their respective permitted successors and assigns.

            10.03 The Bank may, without further consent on the part of the
Fund, subcontract for the performance hereof with (i) Boston EquiServe Limited
Partnership, a Massachusetts limited partnership ("Boston EquiServe"), which
is duly registered as a transfer agent pursuant to Section 17A(c)(2) of the
Securities Exchange Act of 1934 ("Section 17A(c)(2)"), or (ii) a Boston
EquiServe affiliate duly registered as a transfer agent pursuant to Section
17A(c)(2), provided, however, that the Bank shall be as fully responsible to
the Fund for the acts and omissions of any subcontractor as it is for its own
acts and omissions.

Article 11  Amendment

            11.01 This Agreement maybe amended or modified by a written
agreement executed by both parties and authorized or approved by a resolution
of the Board of Directors of the Fund.

Article 12  Massachusetts Law to Apply

            12.01 This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of The Commonwealth of
Massachusetts.

Article 13  Force Majeure

            13.01 In the event either party is unable to perform its
obligations under the terms of this Agreement because of acts of God, strikes,
equipment or transmission failure or damage reasonably beyond its control, or
other causes reasonably beyond its control, such party shall not be liable for
damages to the other for any damages resulting from such failure to perform or
otherwise from such causes.

                                      11
<PAGE>

Article 14  Consequential Damages

            14.01 Neither party to this Agreement shall be liable to the other
party for consequential damages under any provision of this Agreement or for
any consequential damages arising out of any act or failure to act hereunder.

Article 15  Merger of Agreement

            15.01 This Agreement constitutes the entire agreement between the
parties hereto and supersedes any prior agreement with respect to the subject
hereof whether oral or written.

Article 16  Survival

            16.01 All provisions regarding indemnification, warranty,
liability and limits thereon, and confidentiality and/or protection of
proprietary rights and trade secrets shall survive the termination of this
Agreement.

Article 17  Severability

            17.01 If any provision or provisions of this Agreement shall be
held to be invalid, unlawful, or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired.

Article 18  Counterparts

            18.01 This Agreement may be executed by the parties hereto on any
number of counterparts, and all of said counterparts taken together shall be
deemed to constitute one and the same instrument.


                                      12
<PAGE>



            IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed in their names and on their behalf by and through their duly
authorized officers, as of the day and year first above written.




                                       Royce Value Trust, Inc.



                                       BY:
                                          ---------------------------------



ATTEST:

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




                                       State Street Bank and Trust Company



                                       BY:
                                          ---------------------------------
                                            Executive Vice President



ATTEST:

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

   Vice President



                                      13
<PAGE>



                                FIRST AMENDMENT
                                      TO
            REGISTRAR, TRANSFER AGENCY AND PAYING AGENCY AGREEMENT

1.    General Background. In accordance with the Amendment provision in
      Section 11 of the Registrar, Transfer Agency and Paying Agency Agreement
      between State Street Bank and Trust Company (the "Bank") and Royce Value
      Trust, Inc. (the "Fund") dated August 21, 1996 (the "Agreement"), the
      parties desire to amend the Agreement.

      1.2   This Amendment shall be effective May 18, 1998 (the "First
            Amendment") and all defined terms and definitions in the Agreement
            shall be the same in the First Amendment except as specifically
            revised by the First Amendment.

2.    Additional Stock. The Fund will be issuing a new series of Cumulative
      Preferred Stock on May 22, 1998. Section 1.01 of the Agreement is hereby
      deleted in its entirety and the new Section 1.01 below is inserted in
      its place.

      1.01  Subject to the terms and conditions set forth in this Agreement,
            the Fund hereby employs and appoints the Bank to act as, and the
            Bank agrees to act as registrar, transfer agent, dividend paying
            agent and agent in connection with the payment of any redemption
            or liquidation proceeds for the Fund's authorized and issued
            shares of its Cumulative Preferred Stock, including its 7.80%
            Cumulative Preferred Stock and its 7.30 % Tax-Advantaged
            Cumulative Preferred Stock ("Shares"), as set out in the
            prospectuses of the Fund offering the sale of the Shares.

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed in their names and on their behalf by and through their duly
authorized officers, as of this 18th day of May, 1998.

STATE STREET BANK AND TRUST              ROYCE VALUE TRUST, INC.
COMPANY


- -------------------------------          -------------------------------
By:  Charles V. Rossi,                   By:  John D. Diederich,
Title:  Executive Vice President         Title:  Vice President




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.K4
<SEQUENCE>21
<FILENAME>efc2-1398_exhibitk4.txt
<TEXT>
                                                                 Exhibit (K)(4)


        VOID IF NOT RECEIVED BY THE SUBSCRIPTION AGENT BEFORE 5:00 P.M.
                      EASTERN TIME ON THE EXPIRATION DATE

Control No. _________   Maximum Primary Subscription Shares Available ________

                            ROYCE VALUE TRUST, INC.
                     SUBSCRIPTION RIGHTS FOR COMMON STOCK

Dear Stockholder:

     IN ORDER TO EXERCISE YOUR RIGHTS, YOU MUST COMPLETE BOTH SIDES OF THE
TEAR OFF CARD.

     As the registered owner of the Subscription Certificate below, you are
entitled to subscribe for the number of shares of Common Stock, $.001 par
value per share, of Royce Value Trust, Inc. (the "Fund"), shown above pursuant
to the Primary Subscription Right and upon the terms and conditions and at the
Subscription Price for each share of Common Stock specified in the Prospectus
relating thereto. The Rights represented hereby include the Over-Subscription
Privilege for Rights holders, as described in the Prospectus. Under the
Privilege, any number of additional shares may be purchased by a Rights holder
if such shares are available, or if Over-Subscription Shares are issued by the
Fund, and the holder's Primary Subscription Rights have been fully exercised
to the extent possible.

     Registered owners who are participants in the Royce Value Trust, Inc.
Distribution Reinvestment and Cash Purchase Plan will receive their primary
and oversubscription shares via an uncertificated share credit to their
existing accounts. To request a stock certificate, participants in the plan
must check Box D on the reverse side of the Subscription Certificate below.
Registered owners who are not participants in the plan will be automatically
issued stock certificates. Stock certificates for primary share subscriptions
will be delivered as soon as practicable after receipt of the required
completed Subscription Certificate and after full payment has been received
and cleared. Stock certificates for oversubscriptions and confirmation
statements reflecting uncertificated share credits for dividend reinvestment
accounts will be delivered as soon as practicable after the Expiration Date
and after all allocations have been effected.

                  THE SUBSCRIPTION RIGHT IS NON-TRANSFERABLE

     Payment must be in United States dollars. Only money orders or checks
drawn on a bank located in the continental United States and made payable to
Royce Value Trust, Inc. will be accepted. Please reference your rights card
control number on your check, money order or notice of guaranteed delivery.




        VOID IF NOT RECEIVED BY THE SUBSCRIPTION AGENT BEFORE 5:00 P.M.
                      EASTERN TIME ON THE EXPIRATION DATE

<TABLE>
<CAPTION>

<S>                               <C>
Control No. __________            Rights Represented by this Subscription Certificate _______________________
CUSIP No.                                                                Account No. ________________________
</TABLE>

                            ROYCE VALUE TRUST, INC.
                     SUBSCRIPTION RIGHTS FOR COMMON STOCK
          (Complete appropriate section on reverse side of this form)

     The registered owner of this Subscription Certificate named below, or
assigns, is entitled to the number of Rights shown above to subscribe for the
Common Stock, $.001 par value, of Royce Value Trust, Inc. (the "Fund"), in the
ratio of one share of Common Stock for each ten Rights, pursuant to the
Primary Subscription Right and upon the terms and conditions and at the price
for each share of Common Stock specified in the Prospectus relating thereto.
The Rights represented hereby include the Over-Subscription Privilege for
record date Stockholders only, as described in the Prospectus. Under this
Privilege, any number of additional shares may be purchased by a record date
Stockholder if such shares are available, or if Over-Subscription Shares are
issued by the Fund, and the owner's Primary Subscription Rights have been
fully exercised to the extent possible and the pro rata allocation
requirements have been satisfied. Stock certificates for the shares subscribed
for pursuant to the Primary Subscription Right will be delivered as soon as
practicable after receipt of the required completed Subscription Certificate
and after full payment has been received and cleared. Stock certificates for
the shares subscribed for pursuant to the Over-Subscription Privilege will be
delivered as soon as practicable after the Expiration Date and after all
allocations have been effected. Registered owners who are participants in the
Royce Value Trust, Inc. Distribution Reinvestment and Cash Purchase Plan will
receive their primary and oversubscription shares via an uncertificated share
credit to their existing accounts. To request a stock certificate,
participants in the plan should check Box D on the reverse side of this form.
Any refund in connection with an over-subscription will be delivered as soon
as practicable after the Expiration Date and after all allocations have been
effected. To subscribe pursuant to the Primary Subscription Right ten Rights
and the Subscription Price are required for each share of Common Stock. To
subscribe for additional Shares pursuant to the Over-Subscription Privilege,
the Subscription Price is required for each share of Common Stock, subject to
the terms of the Over-Subscription Privilege as described in the Prospectus.
Payment of $____ per share must accompany the Subscription Certificate. See
reverse side of forms.


<PAGE>

To subscribe for your primary shares please complete line "A" on the card below.

Example:

85 shares = 85 rights (85 rights will be AUTOMATICALLY rounded up to 90
rights, the nearest number of rights divisible by ten)

90 rights divided by 10 = 9 primary shares

The maximum number of primary subscription shares would be 9

                            A. 9 x $____ = $______
                                (No. of shares)

To subscribe for any over-subscription shares please complete line "B" below.

Please Note: Only record date Stockholders who have exercised their Primary
Subscription in full may apply for shares pursuant to the Over-Subscription
Privilege.

Payment of Shares: Full payment for both the primary and over-subscription
shares or a notice of guaranteed delivery must accompany this subscription.
Please reference your rights card control number on your check, money order or
notice of guaranteed delivery.

If the aggregate Subscription Price paid by a record date Stockholder is
insufficient to purchase the number of shares of Common Stock that the holder
indicates are being subscribed for, or if a record date Stockholder does not
specify the number of shares of Common Stock to be purchased, then the record
date Stockholder will be deemed to have exercised first, the Primary
Subscription Right (if not already fully exercised) and second, the
Over-Subscription Privilege to purchase shares of Common Stock to the full
extent of the payment rendered. If the aggregate Subscription Price paid by a
record date Stockholder exceeds the amount necessary to purchase the number of
shares of Common Stock for which the record date Stockholder has indicted an
intention to subscribe, then the record date Stockholder will be deemed to
have exercised first, the Primary Subscription Right (if not already fully
exercised) and second, the Over-Subscription Privilege to the full extent of
the excess payment tendered.




               Expiration Date March 10, 2003 (unless extended)

              ---------------------------------------------------
                   PLEASE FILL IN ALL APPLICABLE INFORMATION
              ---------------------------------------------------

To:  EquiServe
     Attention: Corporate Actions

<TABLE>
<CAPTION>
     <S>                               <C>
               By Mail:                                                          By Facsimile:
           P.O. Box 43025                                                       (781) 575-4826


     Providence, RI 02940-3025                               With the original Subscription Certificate to
                                                             be sent by mail, hand or overnight courier. Confirm
                                                             facsimile by telephone to (781) 575-4816






       By Overnight Courier:                                                    By Hand:
         40Campanelli Drive                                  Securities Transfer and Reporting Services, Inc.
        Braintree, MA 02184                                                  c/o EquiServe
                                                                      100 Williams St. Galleria
                                                                         New York, NY 10038
</TABLE>

<TABLE>
<CAPTION>
<S>                                                                      <C>
A.  Primary Subscription  ___________ x   $____    = $_________
    (10 Rights = 1 share) (No. of Shares)(Purchase Price)

B.  Over-Subscription Privilege  ________ x  $_______   =  $______(1)     (1) The Over-Subscription Privilege can be
                                 (Shares)    (Purchase                        exercised only by a record date Stockholder,
                                              Price)                          as described in the Prospectus, and only if
                                                                              the Rights initially issued to him are
                                                                              exercised to the fullest extent possible.

C.  Amount of Check Enclosed                            = $_______
    (or amount in Notice of Guaranteed Delivery)

D.  IF YOU CURRENTLY PARTICIPATE IN THE FUND'S DISTRIBUTION
    REINVESTMENT AND CASH PURCHASE PLAN AND WISH TO RECEIVE A
    CERTIFICATE, CHECK HERE |  |
- -------------------------------------------------------------------------------------------------------------------
TO SUBSCRIBE: I hereby irrevocably subscribe for the face amount of Common Stock indicated as the total of A and B
hereon upon the terms and conditions specified in the Prospectus relating thereto, receipt of which is
acknowledged. I hereby agree that if I fail to pay for the shares of Common Stock for which I have subscribed, the
Fund may exercise any of the remedies set forth in the Prospectus.

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

- -------------------------------------------------------------------------------------
Signature(s) of Subscriber(s)

- -------------------------------------------------------------------------------------
Address for delivery of Shares if other than shown on front

If permanent change of address, check here   |   |

Please give your telephone number: (     ) ____________________________

                       Please give your e-mail address: ____________________________________

</TABLE>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.K5
<SEQUENCE>22
<FILENAME>efc2-1398_exhibitk5.txt
<TEXT>
                                                                EXHIBIT (k)(5)

                                                           (Subscription Agent)


                         SUBSCRIPTION AGENT AGREEMENT

         This Subscription Agent Agreement (the "Agreement") is made as of
January ___, 2003 between The Royce Value Trust, Inc. (the "Fund") and
EquiServe Trust Company, N.A., as subscription agent (the "Agent"). All terms
not defined herein shall have the meaning given in the prospectus (the
"Prospectus") included in the Registration Statement on Form N-2 (File No.
333-______) filed by the Fund with the Securities and Exchange Commission on
January ___, 2003, as amended by any amendment filed with respect thereto (the
"Registration Statement").

         WHEREAS, the Fund proposes to make a subscription offer by issuing
certificates or othe evidences of subscription rights, in the form designated
by the Fund (the "Subscription Certificates") to shareholders of record (the
"Shareholders") of its Common Stock, par value $0.001 per share ("Common
Stock"), as of a record date specified by the Fund (the "Record Date"),
pursuant to which each Shareholder will have certain rights (the "Rights") to
subscribe for shares of Common Stock, as described in and upon such terms as
are set forth in the Prospectus, a final copy of which has been or, upon
availability will promptly be, delivered to the Agent; and

         WHEREAS, the Fund wishes the Agent to perform certain acts on behalf
of the Fund, and the Agent is willing to so act, in connection with the
distribution of the Subscription Certificates and the issuance and exercise of
the Rights to subscribe therein set forth, all upon the terms and conditions
set forth herein.

         NOW, THEREFORE, in consideration of the foregoing and of the mutual
agreements set forth herein, the parties agree as follows:
<PAGE>

1. Appointment. The Fund hereby appoints the Agent to act as subscription
agent in connection with the distribution of Subscription Certificates and the
issuance and exercise of the Rights in accordance with the terms set forth in
this Agreement and the Agent hereby accepts such appointment.

2. Form and Execution of Subscription Certificates.

   (a) Each Subscription Certificate shall be irrevocable and non-transferable.
The Agent shall, in its capacity as Transfer Agent of the Fund, maintain a
register of Subscription Certificates and the holders of record thereof (each
of whom shall be deemed a "Shareholder" hereunder for purposes of determining
the rights of holders of Subscription Certificates).  Each Subscription
Certificate shall, subject to the provisions thereof, entitle the Shareholder
in whose name it is recorded to the following [only if non-transferable]:

          (1) With respect to Record Date Shareholders only, the right
to acquire during the Subscription Period, as defined in the Prospectus, at
the Subscription Price, as defined in the Prospectus, a number of shares of
Common Stock equal to one share of Common Stock for every ten Rights held (the
"Primary Subscription Right"); and

          (2) With respect to Record Date Shareholders only, the right
to subscribe for additional shares of Common Stock, subject to the
availability of such shares and to the allotment of such shares as may be
available among Record Date Shareholders who exercise Over-Subscription Rights
on the basis specified in the Prospectus; provided, however, that such Record
Date Shareholder has exercised all Primary Subscription Rights issued to him
or her (the "Over-Subscription Privilege"). Fractional Shares will not be
issued upon the exercise of Rights.

                                      2
<PAGE>

3. Rights and Issuance of Subscription Certificates.

   (a) Each Subscription Certificate shall evidence the Rights of the
Shareholder therein named to purchase Common Stock upon the terms and
conditions therein and herein set forth.

   (b) Upon the written advice of the Fund, signed by any of its duly
authorized officers, as to the Record Date, the Agent shall, from a list of
the Fund Shareholders as of the Record Date to be prepared by the Agent in its
capacity as Transfer Agent of the Fund, prepare and record Subscription
Certificates in the names of the Shareholders, setting forth the number of
Rights to subscribe for the Fund's Common Stock calculated on the basis of one
Right for each share of Common Stock recorded on the books in the name of each
such Shareholder as of the Record Date. The number of Rights that are issued
to Record Date Shareholders will be rounded down by the Agent, to the nearest
number of Full Rights as Fractional Rights will not be issued. Each
Subscription Certificate shall be dated as of the Record Date and shall be
executed manually or by facsimile signature of a duly authorized officer of
the Subscription Agent. Upon the written advice, signed as aforesaid, as to
the effective date of the Registration Statement, the Agent shall promptly
countersign and deliver the Subscription Certificates, together with a copy of
the Prospectus, instruction letter and any other document as the Fund deems
necessary or appropriate, to all Shareholders with record addresses in the
United States (including its territories and possessions and the District of
Columbia). Delivery shall be by first class mail (without registration or
insurance), except for those Shareholders having a registered address outside
the United States (who will only receive copies of the Prospectus, instruction
letter and other documents as the Fund deems necessary or appropriate, if
any), delivery shall be by air mail (without registration or insurance) and by
first class mail (without registration or insurance)

                                      3
<PAGE>

to those Shareholders having APO or FPO addresses. No Subscription Certificate
shall be valid for any purpose unless so executed.

   (c) The Agent will mail a copy of the Prospectus, instruction letter,
a special notice and other documents as the Fund deems necessary or
appropriate, if any, but not Subscription Certificates to Record Date
Shareholders whose record addresses are outside the United States (including
its territories and possessions and the District of Columbia) ("Foreign Record
Date Shareholders"). The Rights to which such Subscription Certificates relate
will be held by the Agent for such Foreign Record Date Shareholders' accounts
until instructions are received to exercise the Rights.

4. Exercise.

   (a) Record Date Shareholders may acquire shares of Common Stock on
Primary Subscription and pursuant to the Over-Subscription Privilege by
delivery to the Agent as specified in the Prospectus of (i) the Subscription
Certificate with respect thereto, duly executed by such Shareholder in
accordance with and as provided by the terms and conditions of the
Subscription Certificate, together with (ii) the estimated purchase price, as
disclosed in the Prospectus, for each share of Common Stock subscribed for by
exercise of such Rights, in U.S. dollars by money order or check drawn on a
bank in the United States, in each case payable to the order of the Fund.

   (b) Rights may be exercised at any time after the date of issuance of
the Subscription Certificates with respect thereto but no later than 5:00 P.M.
Eastern time on such date as the Fund shall designate to the agent in writing
(the "Expiration Date"). For the purpose of determining the time of the
exercise of any Rights, delivery of any material to the Agent shall be

                                      4
<PAGE>

deemed to occur when such materials are received at the Shareholder Services
Division of the Agent specified in the Prospectus.

   (c) Notwithstanding the provisions of Section 4(a) ad 4(b) regarding
delivery of an executed Subscription Certificate to the Agent prior to 5:00
P.M. Eastern time on the Expiration Date, if prior to such time the Agent
receives a Notice of Guaranteed Delivery by facsimile (telecopy) or otherwise
from a bank, a trust company or a New York Stock Exchange member guaranteeing
delivery of (i) payment of the full Subscription Price for the shares of
Common Stock subscribed for on Primary Subscription and any additional shares
of Common Stock subscribed for pursuant to the Over-Subscription Privilege,
and (ii) a properly completed and executed Subscription Certificate, then such
exercise of Primary Subscription Rights and Over-Subscription Rights shall be
regarded as timely, subject, however, to receipt of the duly executed
Subscription Certificate and full payment for the Common Stock by the Agent
within three Business Days (as defined below) after the Expiration Date (the
"Protect Period") and full payment for their Common Stock within ten Business
Days after the Confirmation Date (as defined in Section 4(d)). For the
purposes of the Prospectus and this Agreement, "Business Day" shall mean any
day on which trading is conducted on the New York Stock Exchange.

   (d) The Fund will determine the Subscription Price by taking the
lower of (i) [$0.50] below the last reported sale price of a share of the
Fund's Common Stock on the New York Stock Exchange on March 23, 2003 (the
"Pricing Date") , or (ii) the net asset value of a share of the Fund's Common
Stock on such a date. Within _____ business days following the Expiration Date
(the "Confirmation Date") the Agent shall send to each exercising shareholder
(or, if shares of Common Stock on the Record Date are held by Code & Co. or
any other depository or nominee, to Cede & Co. or such other depository or
nominee) a confirmation showing the

                                      5
<PAGE>

number of shares of Common Stock acquired pursuant to the Primary
Subscription, and, if applicable, the Over-Subscription Privilege the per
share and total purchase price for such shares, and any additional amount
payable to the Fund by such shareholder or any excess to be refunded by the
Fund to such shareholder in the form of a check and stub, along with a letter
explaining the allocation of shares of Common Stock pursuant to the
Over-Subscription Privilege.

   (e) Any additional payment required from a shareholder must be
received by the Agent within ten Business Days after the Confirmation Date and
any excess payment to be refunded by the Fund to a shareholder will be mailed
by the Agent within ten Business days after the Confirmation Date. If a
shareholder does not make timely payment of any additional amounts due in
accordance with Section 4(d), the Agent will consult with the Fund in
accordance with Section 5 as to the appropriate action to be taken. The Agent
will not issue or deliver certificates for shares subscribed for until payment
in full therefore has been received, including collection of checks and
payment pursuant to notices of guaranteed delivery.

5. Validity of Subscriptions. Irregular subscriptions not otherwise covered by
specific instructions herein shall be submitted to an appropriate officer of
the Fund (or the Fund's administrator) and handled in accordance with his or
her instructions. Such instructions will be documented by the Agent indicating
the instructing officer and the date thereof.

6. Over-Subscription. If, after allocation of shares of Common Stock to Record
Date Shareholders, there remain unexercised Rights, then the Agent shall allot
the shares issuable upon exercise of such unexercised Rights (the "Remaining
Shares") to shareholders who have exercised all the Rights initially issued to
them and who wish to acquire more than the number of shares for which the
Rights issued to them are exercisable. Shares subscribed for pursuant to the

                                      6
<PAGE>

Over-Subscription Privilege will be allocated in the amounts of such
over-subscriptions. If the number of shares for which the Over-Subscription
Privilege has been exercised is greater than the Remaining Shares, the Agent
shall allocate the Remaining Shares to Record Date Shareholders exercising
Over-Subscription Privilege based on the number of shares of Common Stock
owned by them on the Record Date. The percentage of Remaining Shares each
over-subscribing Record Date Shareholder or other Rights holder may acquire
will be rounded up or down to result in delivery of whole shares of Common
Stock. The Agent shall advise the Fund immediately upon the completion of the
allocation set forth above as to the total number of shares subscribed and
distributable.

7. Delivery of Certificates. The Agent will deliver (i) certificates
representing those shares of Common Stock purchased to exercise of Primary
Subscription Rights as soon as practicable after the corresponding Rights have
been validly exercised and full payment for such shares has been received and
cleared and (ii) certificates representing those shares purchased to the
exercise of the Over-Subscription Privilege as soon as practicable after the
Expiration Date and after all allocations have been effected.

8. Holding Proceeds of Rights Offering.

   (a) All proceeds received by the Agent from Shareholders in respect
of the exercise of Rights shall be held by the Agent, on behalf of the Fund,
in a segregated, interest-bearing account (the "Account"). Such interest shall
accrue to the Fund (and not to the benefit of the shareholders who have
submitted Subscription Certificates) pending disbursement in the manner
described in Section 4(e) above.

                                      7
<PAGE>

   (b) The Agent shall deliver all proceeds received in respect of the
exercise of Rights to the Fund as promptly as practicable, but in no event
later than ten business days after the Confirmation Date. Proceeds held in
respect of Excess Payments (including interest and earned thereon) shall
belong to the Fund.

9. Reports. Daily, during the period commencing on February ___, 2003, until
termination of the Subscription Period, the Agent will report by telephone or
telecopier, confirmed by letter, to an Officer of the Fund, data regarding
Rights exercised, the total number of shares of Common Stock subscribed for,
and payments received therefor, bringing forward the figures from the previous
day's report in each case so as to show the cumulative totals and any such
other information as may be mutually determined by the Fund and the Agent.

10. Loss or Mutilation. If any Subscription Certificate is lost, stolen,
mutilated or destroyed, the Agent may, on such terms which will indemnify and
protect the Fund and the Agent as the Agent may in its discretion impose
(which shall, in the case of a mutilated Subscription Certificate include the
surrender and cancellation thereof), issue a new Subscription Certificate of
like denomination in substitution for the Subscription Certificate so lost,
stolen, mutilated or destroyed.

11. Compensation for Services. The Fund agrees to pay to the Agent
compensation for its services as such in accordance with its Fee Schedule to
act as Agent, dated January ___, 2003, and attached hereto as Exhibit A. The
Fund further agrees that it will reimburse the Agent for its reasonable
out-of-pocket expenses incurred in the performance of its duties as such.

12. Instructions and Indemnification. The Agent undertakes the duties and
obligations imposed by this Agreement upon the following terms and conditions:

                                      8
<PAGE>

   (a) The Agent shall be entitled to rely upon any instructions or
directions furnished to it by an appropriate officer of the Fund, whether in
conformity with the provisions of this Agreement or constituting a
modification hereof or a supplement hereto. Without limiting the generality of
the foregoing or any other provision of this Agreement, the Agent, in
connection with its duties hereunder, shall not be under any duty or
obligation to inquire into the validity or invalidity or authority or lack
thereof of any instruction or direction from an officer of the Fund which
conforms to the applicable requirements of this Agreement and which the Agent
reasonably believes to be genuine and shall not be liable for any delays,
errors or loss of data occurring by reason of circumstances beyond the Agent's
control.

   (b) The Fund will indemnify the Agent and its nominees against, and
hold it harmless from, all liability and expense which may arise out of or in
connection with the services described in this Agreement or the instructions
or directions furnished to the Agent relating to this Agreement by an
appropriate officer of the Fund, except for any liability or expense which
shall arise out of the gross negligence, bad faith or willful misconduct of
the Agent or such nominees.

13. Limitation of Liability. The Agent shall be responsible for and shall
indemnify and hold the Fund harmless from and against any and all losses,
damages, costs, charges, counsel fees, payments, expenses and liability
arising out of or attributable to Agent's refusal or failure to comply with
the terms of this Agreement, or which arise out of Agent's negligence or
willful misconduct or which arise out of the breach of any representation or
warranty of Agent hereunder, for which Agent is not entitled to
indemnification under this Agreement; provided, however, that Agent's
aggregate liability during any term of this Agreement with respect to, arising
from, or arising in connection with this Agreement, or from all services
provided or

                                      9
<PAGE>

omitted to be provided under this Agreement, whether in contract, or in tort,
or otherwise, is limited to, and shall not exceed, the amounts paid hereunder
by the Fund to Agent as fees and charges, but not including reimbursable
expenses.

14. Changes in Subscription Certificate. The Agent may, without the consent or
concurrence of the Shareholders in whose names Subscription Certificates are
registered, by supplemental agreement or otherwise, concur with the Fund in
making any changes or corrections in a Subscription Certificate that it shall
have been advised by counsel (who may be counsel for the Fund) is appropriate
to cure any ambiguity or to correct any defective or inconsistent provision or
clerical omission or mistake or manifest error therein or herein contained,
and which shall not be inconsistent with the provision of the Subscription
Certificate except insofar as any such change may confer additional rights
upon the Shareholders.

15. Assignment, Delegation; No Third Party Beneficiaries.

   (a) Except as provided in Section 15(c) below, neither this Agreement
nor any rights or obligations hereunder may be assigned or delegated by either
party without the written consent of the other party.

   (b) This Agreement shall inure to the benefit of and be binding upon
the parties and their respective permitted successors and assigns. Nothing in
this Agreement is intended or shall be construed to confer upon any other
person any right, remedy or claim or to impose upon any other person any duty,
liability or obligation.

   (c) The Agent may, without further consent on the part of the Fund,
(i) subcontract for the performance hereof with EquiServe Limited Partnership
or (ii) subcontract with other

                                      10
<PAGE>

subcontractors for systems, processing, telephone and mailing services, and
clean up activities, as may be required from time to time; provided, however,
that the Agent shall be as fully responsible to the Fund for the acts and
omissions of any subcontractor as it is for its own acts and omissions.

16. Governing Law. The validity, interpretation and performance of this
Agreement shall be governed by the law of the Commonwealth of Massachusetts.

17. No Joint Venture. This Agreement does not constitute an agreement for a
partnership or joint venture between the Agent and the Fund. Neither party
shall make any commitments with third parties that are binding on the other
party without the other party's prior written consent.

18. Force Majeure. In the event either party is unable to perform its
obligations under the terms of this Agreement because of acts of God, strikes,
terrorism, equipment or transmission failure or damage reasonably beyond its
control, or other cause reasonably beyond its control, such party shall not be
liable for damages to the other for any damages resulting from such failure to
perform or otherwise from such causes. Performance under this Agreement shall
resume when the affected party or parties are able to perform substantially
that party's duties.

19. Consequential Damages. Neither party to this Agreement shall be liable to
the other party for any consequential, indirect, special or incidental damages
under any provisions of this Agreement or for any consequential, indirect,
penal, special or incidental damages arising out of any act or failure to act
hereunder even if that party has been advised of or has foreseen the
possibility of such damages.

                                      11
<PAGE>

20. Severability. If any provisions of this Agreement shall be held invalid,
unlawful, or unenforceable, the validity, legality, and enforceability of the
remaining provisions shall not in any way be affected or impaired.

21. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original and all of which together shall be
considered one and the same agreement.

22. Captions. The captions and descriptive headings herein are for the
convenience of the parties only. They do not in any way modify, amplify, alter
or give full notice of the provisions hereof.

23. Confidentiality. The Agent and the Fund agree that all books, records,
information and data pertaining to the business of the other party which are
exchanged or received pursuant to the negotiation or the carrying out of this
Agreement including the fees for services set forth in the attached schedule
shall remain confidential, and shall not be voluntarily disclosed to any other
person, except as may be required by law.

24. Term. This Agreement shall remain in effect until 30 days' written notice
has been provided by either party to the other. Upon termination of the
Agreement, the Agent shall retain all canceled Certificates and related
documentation as required by applicable law.

25. Notices. Until further notice in writing by either party hereto to the
other party, all written reports, notices and other communications between the
Agent and the Fund required or permitted hereunder shall be delivered or
mailed by first class mail, postage prepaid, addressed as follows:

                                      12
<PAGE>

         If to the Fund, to:

                  Royce Value Trust, Inc.

                  1414 Avenue of Americas

                  New York, NY 10019

         With a copy to:

                  Royce & Associates, LLC

                  1414 Avenue of Americas

                  New York, NY 10019

                  Attn: Chief Executive Officer

         If to the Agent, to:

                  EquiServe Trust Company, N.A.

                  c/o EquiServe Limited Partnership

                  150 Royall Street

                  Canton, MA  02021

                  Attn: Reorganization Department

26. Survival. The provisions of Paragraphs 12, 16, 18 - 20, 23, 25 - 27 shall
survive any termination, for any reason, of this Agreement.

27. Merger of Agreement. This Agreement constitutes the entire agreement
between the parties hereto and supercedes any prior agreement with respect to
the subject matter hereof whether oral or written.



                                      13
<PAGE>




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


EQUISERVE TRUST COMPANY, N.A.                   ROYCE VALUE TRUST, INC.


- ----------------------------                    -----------------------------
Signature                                       Signature


- ----------------------------                    -----------------------------
Title                                           Title







</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.K6
<SEQUENCE>23
<FILENAME>efc2-1398_exhibitk6.txt
<TEXT>
                                                                Exhibit (k)(6)


                          INFORMATION AGENT AGREEMENT

         This document will constitute the agreement between Royce Value
Trust, Inc. (the "Fund"), with its principal executive office at 1414 Avenue
of the Americas, New York, NY 10019 and GEORGESON SHAREHOLDER COMMUNICATIONS
INC. ("GSC"), with its principal executive offices at 17 State Street, New
York, NY 10004, relating to a Rights Offer (the "OFFER") by the Fund.

The services to be provided by GSC will be as follows:


   (1)   INDIVIDUAL HOLDERS OF RECORD AND BENEFICIAL OWNERS

         Target Group. GSC estimates that it may initiate outbound or receive
         inbound telephone inquiries to or from approximately 6,670 to 8,465
         of the approximately 39,000 outstanding beneficial and registered
         shareholders. The estimate number is subject to adjustment and GSC
         may actually receive more or less telephone inquiries depending on
         the response to the OFFER.

         Inbound Telephone Calls to Provide Information. GSC will maintain
         toll-free inbound "800" lines for shareholder inquiries about the
         OFFER and GSC customer service representatives will answer any
         questions relating to information provided in the offer documents and
         will assist them in properly executing the Rights documents. The
         "800" lines will be staffed Monday through Friday between 9:00 a.m.
         and 11:00 p.m. Eastern time.

         Re-mails. GSC will coordinate re-mails of offering materials to the
         shareholders who advise us that they have discarded or misplaced the
         originally mailed materials.

         Reminder/Extension Mailing. GSC will help to coordinate any targeted
         or broad-based reminder mailing at the request of the FUND. GSC will
         mail only materials supplied by the FUND or approved by the FUND in
         advance in writing.

         Subscription Reporting. GSC will provide extensive reporting
         beginning one week prior to expiration of the OFFER or any extensions
         thereafter, which will measure shareholder participation and the
         number/percentage of shares being tendered. This reporting will be
         based solely on previously established contacts within the
         reorganization departments of participating broker/dealers.



<PAGE>


   (2)   BANK/BROKER SERVICING

         GSC will contact all banks, brokers and other nominee shareholders
         ("intermediaries") holding stock as shown on appropriate portions of
         the shareholder lists to ascertain quantities of offering materials
         needed for forwarding to beneficial owners.

         GSC will deliver offering materials by messenger to New York City
         based intermediaries and by Federal Express or other means to non-New
         York City based intermediaries. GSC will also follow-up by telephone
         with each intermediary to insure receipt of the offering materials
         and to confirm timely re-mailing of materials to the beneficial
         owners.

         GSC will maintain frequent contact with intermediaries to monitor
         shareholder response and to insure that all liaison procedures are
         proceeding satisfactorily.

         GSC will report to the FUND the date all material was shipped,
         received and distributed by participating intermediaries.


   (3)   PROJECT FEE

         In consideration for acting as Information Agent GSC will receive a
         project fee of $12,500. Terms of payment are outlined in section 7 of
         this agreement.


   4)    ESTIMATED EXPENSES

         GSC will be reimbursed by the FUND for its reasonable out-of-pocket
         expenses incurred provided that GSC submits to the FUND an expense
         report, itemizing such expenses and providing copies of all
         supporting bills in respect of such expenses. If the actual expenses
         incurred are less than the portion of the estimated high range
         expenses paid in advance by the FUND, the FUND will receive from GSC
         a check payable in the amount of the difference at the time that GSC
         sends its final invoice for the second half of the project fee.

         GSC's expenses are estimated as set forth below and the estimates are
         based largely on data provided to GSC by the FUND. In the course of
         the OFFER, the expenses and expense categories may change due to
         changes in the OFFER schedule or due to events beyond GSC's control,
         such as delays in receiving offering material and related items. In
         the event of significant change or new expenses not originally
         contemplated, GSC will notify the FUND by phone and/or by letter for
         approval of such expenses.



<PAGE>


<TABLE>
<CAPTION>
             Estimated Expenses                                                           Low Range                 High Range
             ------------------                                                           ---------                 ----------

          <S>                                                                           <C>                         <C>
             Data Handling and Preparation
             Telephone # Lookup - Account Consolidation
             Computer Match and Info. Operators (blended rate)
             13,416 @ $0.60...............................................................$8,049.00                   $8,049.00

             Outbound Telephone Calls
             5,366 to 6,036 @ $3.75 (registered and NONO holders).........................20,122.50                   22,635.00
             720 to 935 @ $4.00 (brokers, banks and intermediaries)........................2,880.00                    3,740.00

             Incoming "800" calls (shareholders, banks, brokers)
             585 to 1,169 @ $3.75..........................................................2,193.75                    4,383.75

             Distribution Expenses (includes messengers,
             freight and FedEx)............................................................3,900.00                    8,900.00

             Miscellaneous, data processing, street search,
             fax and FedEx...................................................................750.00                    1,500.00

                 Total Estimated Expenses................................................$37,895.25                  $49,207.75
</TABLE>


   (5)   PERFORMANCE

         GSC will use its best efforts to achieve the goals of the FUND but
         GSC is not guaranteeing a minimum success rate. GSC's Project Fee as
         outlined in Section 3 or Expenses as outlined in Section 4 are not
         contingent upon a specific level of participation in the OFFER.

         GSC's strategies revolve around an inbound telephone information
         campaign. The purpose of the telephone information campaign is to
         assist in raising the overall awareness amongst shareholders of the
         OFFER and help shareholders better understand the transaction. This
         in turn may result in higher overall response.

   (6)   COMPLIANCE

         The FUND will be responsible for compliance with any regulations
         required by the Securities and Exchange Commission, National
         Association of Securities Dealers or any applicable federal or state
         agencies.

         In rendering the services contemplated by this Agreement, GSC agrees
         not to make any representations, oral or written, to any shareholders
         or prospective shareholders of the FUND that are not contained in the
         FUND's Rights Offer material, unless previously authorized to do so
         in writing by the FUND.

   7)    PAYMENT

         Payment for the full fee and expenses, as outlined in sections 3 and
         4 of this agreement, will be made by the FUND and due thirty days
         after GSC sends its final invoice.



<PAGE>


   (8)   MISCELLANEOUS

         GSC will hold in confidence and will not use nor disclose to third
         parties information we receive from the FUND, or information
         developed by GSC based upon such information we receive, except for
         information which was public at the time of disclosure or becomes
         part of the public domain without disclosure by GSC or information
         which we learn from a third party which does not have an obligation
         of confidentiality to the FUND.

         In the event the project is canceled for an indefinite period of time
         after the signing of this contract and before the expiration of the
         OFFER, GSC will be reimbursed by the FUND for any expenses incurred
         and a pro rata portion of the project fee based on the number of days
         between the initial public announcement of the OFFER to the
         originally planned expiration of the OFFER.

         The Fund agrees to indemnify and hold harmless GSC and its
         stockholders, officers, directors, employees, agents and affiliates
         against any and all claims, costs, damages, liabilities, judgments
         and expenses, including the fees, costs and expenses of counsel
         retained by GSC ("Losses"), which result from claims, actions, suits,
         subpoenas, demands or other proceedings brought against or involving
         GSC which directly relate to or arise out of GSC's performance of the
         Services (except for costs, damages, liabilities, judgments or
         expenses which shall have been determined by a court of law pursuant
         to a final and nonappealable judgment to have directly resulted from
         GSC's negligence or willful misconduct. To the extent the Fund
         suffers Losses as a direct result of GSC's negligence or willful
         misconduct, GSC agrees to indemnify and hold harmless the Fund and
         its stockholders, officers, directors, employees, agents and
         affiliates. In addition the prevailing party shall be entitled to
         reasonable attorneys' fees and court costs in any action between the
         parties to enforce the provisions of this Agreement, including the
         indemnification rights contained in this paragraph. The indemnity
         obligations set forth in this shall survive the termination of this
         Agreement.


        This agreement will be governed by and construed in accordance with
the laws of the State of New York. This AGREEMENT sets forth the entire
AGREEMENT between GSC and the FUND with respect to the agreement herein and
cannot be modified except in writing by both parties.

        IN WITNESS WHEREOF, the parties have signed this AGREEMENT this _____
day of January, 2003.


ROYCE VALUE TRUST, INC.                          GEORGESON SHAREHOLDER
                                                 COMMUNICATIONS INC.




By_________________________                      By_________________________
                                                    Robert S. Brennan
                                                    Senior Vice President


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.N1
<SEQUENCE>24
<FILENAME>efc2-1398_exhibitn1.txt
<TEXT>
                                                                Exhibit (n)(1)




                        CONSENT OF INDEPENDENT AUDITORS



    We consent to the references to our firm in this Registration Statement
(Form N-2, File No. 811-4875) of Royce Value Trust, Inc. and to the use of our
report dated January 17, 2002 on the financial statements and financial
highlights of Royce Value Trust, Inc. Such financial statements and financial
highlights appear in the 2001 Annual Report to Shareholders which is
incorporated by reference in the Registration Statement.





                                                TAIT, WELLER & BAKER


Philadelphia, Pennsylvania
December 31, 2002




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.N2
<SEQUENCE>25
<FILENAME>efc2-1398_exhibitn2.txt
<TEXT>
                                                                Exhibit (n)(2)




                        CONSENT OF INDEPENDENT AUDITORS



     We consent to the reference of our firm under the captions "Financial
Highlights" and "Experts" and the incorporation by reference to our report
dated February 10, 1998 in this Registration Statement of Royce Value Trust,
Inc. to be filed on or about January 3, 2003





                                                ERNST & YOUNG LLP


New York, New York
January 3, 2003

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.R
<SEQUENCE>26
<FILENAME>efc2-1398_exhibitr.txt
<TEXT>
                                                                   Exhibit (r)




                                CODE OF ETHICS
                                      FOR
                                THE ROYCE FUNDS
                                      AND
                              THE ROYCE COMPANIES

                      Adopted -- As of December 30, 1994
                      As amended as of September 12, 2002

          1. Definitions.

              (a) "Fund" means each of The Royce Fund, Royce Capital Fund,
Royce Value Trust, Inc., Royce Micro-Cap Trust, Inc., Royce Focus Trust, Inc.
and any other investment company or series of an investment company registered
as such under the Investment Company Act of 1940 which has the same investment
adviser as the Fund.

              (b) "Royce" means Royce & Associates, LLC and Royce Fund
Services, Inc.

              (c) "Covered Person" means any interested trustee, director,
officer, employee or Advisory Person of the Fund or any director, officer,
employee or Advisory Person of Royce.

              (d) "Advisory Person" means any natural person in a control
relationship to the Fund or Royce who obtains information concerning
recommendations made to the Fund or any other Royce client with regard to the
purchase or sale of a security.

              (e) A security is "being considered for purchase or sale" when a
recommendation to purchase or sell such security has been made and
communicated and, with respect to the person making the recommendation, when
such person seriously considers making such a recommendation.

              (f) "Beneficial ownership" shall be interpreted in the same
manner as it would be in determining whether a person is subject to the
provisions of Section 16 of the Securities Exchange Act of 1934 and the rules
and regulations thereunder, except that the determination of direct or
indirect beneficial ownership shall apply to all securities which a Covered
Person has or acquires. It includes ownership by a member of a Covered
Person's immediate family (such as spouse, minor children and adults living in
a Covered Person's home) and trusts of which a Covered Person or such an
immediate family member is a trustee or in which any such person has a
beneficial interest.

              (g) "Control" shall have the same meaning as that set forth in
Section 2(a)(9) of the Investment Company Act of 1940.

              (h) "Disinterested Director" means a trustee or director of the
Fund who is not an 'interested person' of the Fund within the meaning of
Section 2(a)(19) of the Investment Company Act of 1940.

<PAGE>

              (i) "Interested Director" means a trustee or director of the
Fund who is an 'interested person' of the Fund within the meaning of Section
2(a)(19) of the Investment Company Act of 1940.

              (j) "Non-Management Royce Director" means a Covered Person who
is a director of Royce, but who is not an officer or employee of Royce.

              (k) "Purchase or sale of a security" includes, inter alia, the
writing of an option to purchase or sell a security.

              (l) "Security" shall have the meaning set forth in Section
2(a)(36) of the Investment Company Act of 1940, except that it shall not
include (i) shares of registered open-end investment companies, (ii)
securities which are direct obligations of the United States and (iii)
bankers' acceptances, bank certificates of deposit, commercial paper and other
money market instruments.

              (m) "Initial Public Offering" means an offering of securities
registered under the Securities Act of 1933, the issuer of which, immediately
before the registration, was not subject to the reporting requirements of
Sections 13 or 15(d) of the Securities Exchange Act of 1934.

          2. Statement of General Principles. Each Covered Person shall, in
connection with his or her personal investment activities, (i) at all times
place the interests of Royce clients and Fund shareholders first, (ii) conduct
all such transactions consistent with this Code and in such a manner as to
avoid any actual or potential conflict of interest or any abuse of his or her
position of trust and responsibility and (iii) not take any inappropriate
advantage of his or her positions.

          3. Prohibited Purchases and Sales. (a) No Covered Person other than
a Non-Management Royce Director shall purchase or sell, directly or
indirectly, any security in which he or she has, or by reason of such
transaction acquires, any direct or indirect beneficial ownership unless such
purchase or sale is exempted pursuant to Section 4 of this Code. The preceding
sentence of this Section 3(a) shall not prohibit the purchase or sale of any
security by Royce for the account of any pooled investment vehicle managed by
Royce, including a limited partnership, limited liability company or other
entity in which Royce or a Covered Person has a beneficial interest as a
general partner and/or otherwise, provided that the aggregate beneficial
interests of Royce and/or all Covered Persons in any such pooled investment
vehicle shall not exceed (i) 24.90% of such vehicle's capital accounts or
other equity interests or (ii) 20% of such vehicle's realized and unrealized
net capital gains from securities transactions. However, purchases of Initial
Public Offerings or private placement securities by any such pooled investment
vehicle in which a Covered Person has a beneficial interest shall be
pre-approved in writing by the Compliance Officer and either an executive
officer or Senior Portfolio Manager of Royce.

              (b) No Disinterested Director or Non-Management Royce Director
shall purchase or sell, directly or indirectly, any security in which he or
she has, or by reason of such transaction acquires, any direct or indirect
beneficial ownership if such director knew or, in the ordinary course of
fulfilling his or her official duties as a director or trustee of the Fund or
as a director of Royce, should have known that such security was then being
purchased or sold by the Fund or, in the case of a Non-Management Royce
Director, another Royce account or was then being considered by the



                                      2
<PAGE>


Fund or Royce for purchase or sale by the Fund or, in the case of a
Non-Management Royce Director, another Royce account, unless such purchase or
sale is exempted pursuant to Section 4 of this Code.

          4. Exempted Transactions. The prohibitions of Sections 3(a) and 3(b)
of this Code shall not apply to:

              (a) Purchases or sales effected in any account over which the
Covered Person or Disinterested Director has no direct or indirect influence
or control.

              (b) Purchases or sales which are non-volitional on the part of
either the Covered Person, the Disinterested Director or the Fund or other
Royce client.

              (c) Purchases which are part of an automatic distribution
reinvestment plan or an employer-sponsored, automatic payroll deduction, cash
purchase plan.

              (d) Purchases effected upon the exercise of rights issued by an
issuer pro rata to all holders of a class of its securities, to the extent
such rights were acquired from such issuer, and sales of such rights so
acquired.

              (e) Purchases or redemptions or sales of debt securities which
are either "Government securities" within the meaning of Section 2(a)(16) of
the Investment Company Act of 1940 or "municipal securities" within the
meaning of Section 3(a)(29) of the Securities Exchange Act of 1934.

              (f) Purchases or sales of shares of passively-managed registered
investment companies or other baskets of securities which trade on a national
securities exchange or on Nasdaq and whose investment objective is to closely
track the performance of an index of securities.

              (g) Purchases or sales by a Covered Person which receive the
prior approval of the Compliance Officer and either an executive officer or
Senior Portfolio Manager of Royce (to be promptly confirmed in writing)
because (i) they are not eligible for purchase or sale by the Fund or any
other Royce account, (ii) they are only remotely potentially harmful to the
Fund and Royce's other accounts because they would be very unlikely to affect
a highly institutional market, (iii) they clearly are not related economically
to the securities to be purchased, sold or held by the Fund or any other Royce
account, (iv) they are not then being purchased or sold, and neither the
executive officer or Senior Portfolio Manager pre-approving the transaction
nor the Covered Person have any current knowledge that the securities are then
being considered for purchase or sale, by the Fund or any other Royce account
or (v) in the case of an Initial Public Offering, they are available for
purchase by the Covered Person solely by virtue of his or her non-business
relationship with a family member or other person and are not in any way
related to the Covered Person's position with the Fund or Royce.

              Prior approvals pursuant to clause (iv) above shall be granted
only in a limited number of instances, and any prior approval granted pursuant
to this Section 4(g) shall be subject to the following restrictions and
conditions:



                                      3
<PAGE>

              (1) Each written confirmation by the Compliance Officer and
either an executive officer or Senior Portfolio Manager of Royce of their
prior approval of a purchase or sale by a Covered Person shall show the basis
on which the prior approval was granted and the period for which it was
granted (which shall not exceed five trading days from the date of the grant).

              (2) Generally, no Covered Person shall be permitted to acquire
any securities in an Initial Public Offering, except to the extent set forth
in Section 3(a) above.

              (3) Prior approval is required for a Covered Person to acquire
any securities (including limited partnership interests) in a private
placement. Such prior approval should take into account, among other factors,
whether the investment opportunity should be reserved for the Fund and/or
other Royce account(s), and whether the opportunity is being offered to the
Covered Person by virtue of his or her position with the Fund or Royce. Any
Covered Person who may be authorized to acquire securities in a private
placement shall disclose that investment when he or she plays a part in the
Fund's or Royce's subsequent consideration of an investment in the issuer,
and, in such circumstances, the Fund's and/or Royce's decision to purchase
securities of the issuer shall be subject to an independent review by
investment personnel with no personal interest in the issuer.

              (4) No Covered Person shall be permitted to purchase or sell a
security within at least seven calendar days before and after the Fund or any
other Royce account trades in that security, and any profits realized on
trades within such proscribed periods shall be disgorged by the Covered
Person.

              (5) No Covered Person, except in unusual or exceptional
circumstances, may profit in the purchase and sale, or sale and purchase, of
the same (or equivalent) securities within 60 calendar days, and any profits
realized on such short-term trades shall, except in such circumstances, be
disgorged by the Covered Person.

          5. Gifts. No Covered Person shall receive any gift or other thing
of more than $100 in value from any individual or entity that does business
with or on behalf of the Fund or any other Royce account. This prohibition
does not extend to bona fide business-related entertainment and/or travel.

          6. Service as a Director. No Covered Person other than a
Non-Management Royce Director may serve on the board of directors of any
publicly-traded company, absent prior authorization based upon a determination
that the board service would be consistent with the interests of the Fund and
Royce's other accounts. In the relatively small number of instances in which
board service may be authorized, the Covered Person serving as a director
normally should be isolated from those making investment decisions through
"Chinese Wall" or other procedures.

          7. Reporting.

              (a) Every Covered Person shall report to the Fund and Royce the
information described in Section 7(c) of this Code with respect to
transactions in any security in which such Covered Person has, or by reason of
such transaction acquires, any direct or indirect beneficial ownership in the
security; provided, however, that a Covered Person shall not be required to
make



                                      4
<PAGE>

a report with respect to transactions effected for any account over which such
Covered Person does not have any direct or indirect influence or control.

              (b) A Disinterested Director need only report to the Fund a
transaction in a security if such director, at the time of that transaction,
knew or, in the ordinary course of fulfilling his or her official duties as a
director, should have known that, during the 15 calendar days before or after
the date of the transaction by the director, such security was purchased or
sold by the Fund or was being considered by the Fund or Royce for purchase or
sale by the Fund.

              (c) Every report shall be in writing, shall be signed by the
person making it, shall be made not later than 10 days after the end of the
calendar quarter in which the transaction to which the report relates was
effected and shall contain the following information:

                  (i) The date of the transaction, the title and the number of
shares, and the principal amount of each security involved;

                  (ii) The nature of the transaction -- i.e., purchase, sale
or any other type of acquisition or disposition;

                  (iii) The price at which the transaction was effected;

                  (iv) The name of the broker, dealer or bank with or through
whom the transaction was effected; and

                  (v) With respect to any account established by the Covered
Person during the quarter for the direct or indirect benefit of the Covered
Person, the name of the broker, dealer or bank with whom the account was
established and the date the account was established.

              Notwithstanding the foregoing, the report of a Non-Management
Royce Director may exclude information contained in any duplicate copies of
broker trade confirmations and/or periodic account statements that are
supplied to the Compliance Officer under Section 7(e) of this Code, provided
that such confirmations and/or statements have been received by the Compliance
Officer no later than 10 days after the end of the calendar quarter in which
the transaction(s) to which they relate to were effected.

              (d) Any such report shall include transactions exempted pursuant
to Section 4 of this Code and may contain a statement that the report shall
not be construed as an admission by the person making such report that he or
she has any direct or indirect beneficial ownership in the security to which
the report relates.

              (e) All Covered Persons shall (i) direct their brokers to supply
to the Compliance Officer, on a timely basis, duplicate copies of
confirmations of all personal securities transactions and copies of periodic
statements for all securities accounts and (ii) disclose to the Fund and Royce
all personal securities holdings upon commencement of employment and
thereafter on an annual basis.



                                      5
<PAGE>

              8. Sanctions. Upon discovering a violation of this Code, Royce
and/or the Board of Trustees/Directors of the Fund may impose such sanctions
as it deems appropriate, including, inter alia, a letter of censure or
suspension or termination of the employment of the violator.



                                      6

</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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