<DOCUMENT>
<TYPE>EX-99.H
<SEQUENCE>5
<FILENAME>rvt_63005-exh.txt
<DESCRIPTION>FORM OF UNDERWRITING AGREEMENT
<TEXT>









                                   EXHIBIT (h)

                             UNDERWRITING AGREEMENT





<PAGE>


                                                                     Exhibit (h)

                             ROYCE VALUE TRUST, INC.

                            % CUMULATIVE PREFERRED STOCK
                     Liquidation Preference $25.00 per share




                             UNDERWRITING AGREEMENT
                             ----------------------

                                                              New York, New York
                                                              October   , 2003

Citigroup Global Markets Inc.
UBS Securities LLC
As Representatives of the several Underwriters

c/o Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York  10013

Ladies and Gentlemen:

            The undersigned, Royce Value Trust, Inc., a Maryland corporation
(the "Fund") and Royce & Associates, LLC, a Delaware limited liability company
(the "Adviser") address you as underwriters and as the representatives (the
"Representatives") of each of the several underwriters named on Schedule I
hereto (herein collectively called "Underwriters"). The Fund proposes to sell to
the Underwriters _____ shares (the "Securities") of its     % Cumulative
Preferred Stock, par value $.001 per share and liquidation preference $25.00 per
share (the "Cumulative Preferred Stock"). Unless otherwise stated, the term
"you" as used herein means each of Citigroup Global Markets Inc. and UBS
Securities LLC individually on its own behalf and on behalf of the other
Underwriters. Certain terms used herein are defined in Section 18 hereof. The
Securities will be authorized by, and subject to the terms and conditions of,
the Articles Supplementary to be adopted in connection with the issuance of the
Securities (the "Articles Supplementary").

            The Fund and the Adviser wish to confirm as follows their agreements
with you and the other several Underwriters on whose behalf you are acting in
connection with the several purchases of the Securities by the Underwriters.

            The Fund has entered into (i) an Investment Advisory Agreement with
the Adviser, dated as of October 1, 2001; (ii) a Custodian Agreement with State
Street Bank and Trust Company ("State Street") dated as of October 20, 1986, as
amended to date; and (iii) a Registrar, Transfer Agency and Paying Agency
Agreement with State Street, dated as of August

<PAGE>


21, 1996, as amended to date; and such agreements are herein referred to as the
"Advisory Agreement," the "Custodian Agreement" and the "Transfer Agency
Agreement," respectively. Collectively, the Advisory Agreement, the Custodian
Agreement and the Transfer Agency Agreement are herein referred to as the "Fund
Agreements."

            1.       Representations and Warranties of the Fund and the Adviser.
The Fund and the Adviser, jointly and severally, represent and warrant to, and
agree with, each Underwriter as set forth below in this Section 1.

            (a)      The Fund has prepared and filed with the Commission a
     registration statement (file numbers 333-107578 and 811-04875) on Form N-2,
     including a related preliminary prospectus (including the statement of
     additional information incorporated by reference therein), for registration
     under the 1933 Act and the 1940 Act of the offering and sale of the
     Securities. The Fund may have filed one or more amendments thereto,
     including a related preliminary prospectus (including the statement of
     additional information incorporated by reference therein), each of which
     has previously been furnished to you. The Fund will next file with the
     Commission one of the following: either (1) prior to the Effective Date of
     such registration statement, a further amendment to such registration
     statement (including the form of final prospectus (including the statement
     of additional information incorporated by reference therein)) or (2) after
     the Effective Date of such registration statement, a final prospectus
     (including the statement of additional information incorporated by
     reference therein) in accordance with Rules 430A and 497. In the case of
     clause (2), the Fund has included in such registration statement, as
     amended at the Effective Date, all information (other than Rule 430A
     Information) required by the Acts and the Rules and Regulations to be
     included in such registration statement and the Prospectus. As filed, such
     amendment and form of final prospectus (including the statement of
     additional information incorporated by reference therein), or such final
     prospectus (including the statement of additional information incorporated
     by reference therein), shall contain all Rule 430A Information, together
     with all other such required information, and, except to the extent the
     Representatives shall agree in writing to a modification, shall be in all
     substantive respects in the form furnished to you prior to the Execution
     Time or, to the extent not completed at the Execution Time, shall contain
     only such specific additional information and other changes (beyond that
     contained in the latest Preliminary Prospectus) as the Fund has advised
     you, prior to the Execution Time, will be included or made therein. The
     Fund has furnished the Underwriters with copies of such Registration
     Statement, each amendment to such Registration Statement filed with the
     Commission and each Preliminary Prospectus.

            (b)      Each Preliminary Prospectus included as part of the
     registration statement as originally filed or as part of any amendment or
     supplement thereto, or filed pursuant to Rule 497, complied when so filed
     in all material respects with the provisions of the Acts and the Rules and
     Regulations. The Commission has not issued any order preventing or
     suspending the use of any Preliminary Prospectus.

            (c)      The Registration Statement in the form in which it became
     or becomes effective and also in such form as it may be when any
     post-effective amendment thereto shall become effective, the Prospectus and
     any supplement thereto when filed with the

                                       2

<PAGE>


     Commission under Rule 497 and the 1940 Act Notification when originally
     filed with the Commission and any amendment or supplement thereto when
     filed with the Commission, complied or will comply in all material respects
     with the provisions of the Acts and the Rules and Regulations and did not
     or will not at any such times contain an untrue statement of a material
     fact or omit to state a material fact required to be stated therein or
     necessary to make the statements therein not misleading, except that this
     representation and warranty does not apply to statements in or omissions
     from the registration statement or the Prospectus made in reliance upon and
     in conformity with information relating to any Underwriter furnished to the
     Fund in writing by or on behalf of any Underwriter through you expressly
     for use therein.

            (d)      The Securities have been duly authorized and, when issued
     and delivered to the Underwriters against payment therefor in accordance
     with the terms hereof, will be validly issued, fully paid and nonassessable
     and free of any preemptive or similar rights and will conform to the
     description thereof in the Registration Statement and the Prospectus (and
     any amendment or supplement to either of them).

            (e)      The Fund's capitalization and adjusted capitalization as of
     June 30, 2003 is as set forth in the Prospectus; all outstanding shares of
     the Fund's Common Stock, the 7.30% Preferred and the 7.80% Preferred have
     been duly authorized and validly issued, are fully paid and nonassessable
     and are free of any preemptive or similar rights, and conform to the
     description thereof in the Registration Statement and the Prospectus (and
     any amendment or supplement to either of them).

            (f)      The Fund is a corporation duly organized and validly
     existing in good standing under the laws of the State of Maryland with full
     corporate power and authority to own, lease and operate its property or
     assets and to conduct its business as described in the Registration
     Statement and the Prospectus (and any amendment or supplement to either of
     them), and is duly registered and qualified to conduct its business and is
     in good standing in each jurisdiction or place where the nature of its
     property or assets or the conduct of its business requires such
     registration or qualification, except where the failure so to register or
     qualify does not have a material adverse effect on the condition (financial
     or other), business, prospects, property, net assets or results of
     operations of the Fund, or on the ability of the Fund to perform its
     obligations under this Agreement or any of the Fund Agreements. The Fund
     has no subsidiaries.

            (g)      There are no legal or governmental proceedings pending or,
     to the knowledge of the Fund, threatened, against the Fund, or to which the
     Fund or any of its property or assets is subject, that are required to be
     described in the Registration Statement or the Prospectus (and any
     amendment or supplement to either of them) but are not described as
     required, and there are no agreements, contracts, indentures, leases or
     other instruments that are required to be described in the Registration
     Statement or the Prospectus (and any amendment or supplement to either of
     them) or to be filed as an exhibit to the Registration Statement that are
     not described or filed as required by the Acts or the Rules and
     Regulations.

                                       3

<PAGE>

            (h)      The Fund is not in violation of its articles of
     incorporation, as amended and supplemented to date, including the Articles
     Supplementary relating to the 7.30% Preferred and the Articles
     Supplementary relating to the 7.80% Preferred (collectively, the "Charter")
     or bylaws (the "Bylaws"), or of any law, ordinance, administrative or
     governmental rule or regulation applicable to the Fund or of any decree of
     the Commission, any state securities commission, any national securities
     exchange, any arbitrator, any court or governmental agency, body or
     official having jurisdiction over the Fund, or in default in any material
     respect in the performance of any obligation, agreement or condition
     contained in any bond, debenture, note or any other evidence of
     indebtedness or in any material agreement, indenture, lease or other
     instrument to which the Fund is a party or by which it or any of its
     property or assets may be bound.

            (i)      Neither the issuance and sale of the Securities, the
     execution, delivery or performance of this Agreement or any of the Fund
     Agreements by the Fund, nor the consummation by the Fund of the
     transactions contemplated hereby or thereby (A) requires any consent,
     approval, authorization or other order of or registration or filing with,
     the Commission, any state securities commission, any national securities
     exchange, any arbitrator, any court, regulatory body, administrative agency
     or other governmental body, agency or official (except for the registration
     of the Securities under the 1933 Act and such consents, approvals,
     authorizations, registrations or qualifications as may be required under
     applicable state securities or Blue Sky laws in connection with the
     purchase and distribution of the Securities by you and the required rating
     agency confirmation), (B) violates or will violate or conflicts or will
     conflict with any provision of the Charter or bylaws of the Fund or any
     statute, law, regulation or judgment, injunction, order or decree
     applicable to the Fund or any of its property or assets or (C) conflicts or
     will conflict with or constitutes or will constitute a breach of, or a
     default under, any agreement, indenture, lease or other instrument to which
     the Fund is a party or by which it or any of its property or assets may be
     bound, or will result in the creation or imposition of any lien, charge or
     encumbrance upon any property or assets of the Fund pursuant to the terms
     of any agreement or instrument to which it is a party or by which it may be
     bound or to which any of its property or assets is subject. The Fund is not
     subject to any order of any court or of any arbitrator, governmental
     authority or administrative agency.

            (j)      Tait, Weller & Baker, who have audited the financial
     statements included or incorporated by reference in the Registration
     Statement and the Prospectus, are independent public accountants with
     respect to the Fund within the meaning of the 1933 Act and the 1933 Act
     Rules and Regulations.

            (k)      The financial statements, together with related schedules
     and notes, included or incorporated by reference in the Registration
     Statement and the Prospectus (and any amendment or supplement to either of
     them), present fairly the financial position, results of operations and
     changes in financial position of the Fund on the basis stated or
     incorporated by reference in the Registration Statement at the respective
     dates or for the respective periods to which they apply; such statements
     and related schedules and notes have been prepared in accordance with
     generally accepted accounting principles consistently applied throughout
     the periods involved, except as disclosed therein; and the

                                       4

<PAGE>

     other financial and statistical information and data included in the
     Registration Statement and the Prospectus (and any amendment or supplement
     to either of them) are accurately presented and prepared on a basis
     consistent with such financial statements and the books and records of the
     Fund.

            (l)      The execution and delivery of, and the performance by the
     Fund of its obligations under, this Agreement and the Fund Agreements have
     been duly and validly authorized by the Fund, and this Agreement and the
     Fund Agreements have been duly executed and delivered by the Fund and
     constitute the valid and legally binding agreements of the Fund,
     enforceable against the Fund in accordance with their terms, except as
     rights to indemnity and contribution hereunder and thereunder may be
     limited under federal or state securities laws.

            (m)      Except as disclosed in the Registration Statement and the
     Prospectus (or any amendment or supplement to either of them), subsequent
     to the respective dates as of which such information is given in the
     Registration Statement and the Prospectus (or any amendment or supplement
     to either of them), the Fund has not incurred any liability or obligation,
     direct or contingent, or entered into any transaction, not in the ordinary
     course of business, that is material to the Fund, and there has not been
     any change in the capital stock, or material increase in the short-term
     debt or long-term debt, of the Fund, or any material adverse change, or any
     development involving or which may reasonably be expected to involve, a
     prospective material adverse change, in the condition (financial or other),
     business, prospects, property, net assets or results of operations of the
     Fund taken as a whole, whether or not arising in the ordinary course of
     business.

            (n)      The Fund has not distributed and, prior to the later to
     occur of the Closing Date and the completion of the distribution of the
     Securities will not distribute, any offering material in connection with
     the offering and sale of the Securities other than the Registration
     Statement, the Preliminary Prospectus, the Prospectus or other materials,
     if any, permitted by the Acts or the Rules and Regulations.

            (o)      The Fund has such permits, licenses, franchises and
     authorizations of governmental or regulatory authorities ("permits") as are
     necessary to own its property and assets and to conduct its business in the
     manner described in the Prospectus (and any supplement thereto), subject to
     such qualifications as may be set forth in the Prospectus; the Fund has
     fulfilled and performed all its material obligations with respect to such
     permits and no event has occurred which allows, or after notice or lapse of
     time would allow, revocation or termination thereof or results in any other
     material impairment of the rights of the Fund under any such permit,
     subject in each case to such qualification as may be set forth in the
     Prospectus (and any supplement thereto); and, except as described in the
     Prospectus (and any supplement thereto), none of such permits contains any
     restriction that is materially burdensome to the Fund.

            (p)      The Fund maintains a system of internal accounting controls
     sufficient to provide reasonable assurances that (i) transactions are
     executed in accordance with general or specific authorization from the
     Fund's officers and with the applicable requirements of the 1940 Act, the
     1940 Act Rules and Regulations and the Code; (ii)

                                       5

<PAGE>

     transactions are recorded as necessary to permit preparation of financial
     statements in conformity with generally accepted accounting principles and
     to maintain accountability for assets and to maintain compliance with the
     books and records requirements under the 1940 Act and the 1940 Act Rules
     and Regulations; (iii) access to assets is permitted only in accordance
     with general or specific authorization from the Fund's officers; and (iv)
     the recorded accountability for assets is compared with existing assets at
     reasonable intervals and appropriate action is taken with respect to any
     differences.

            (q)      To the Fund's knowledge, neither the Fund nor any employee
     or agent of the Fund has made any payment of funds of the Fund or received
     or retained any funds in violation of any law, rule or regulation, which
     payment, receipt or retention of funds is of a character required to be
     disclosed in the Prospectus.

            (r)      The Fund has filed all tax returns required to be filed,
     which returns are complete and correct, and the Fund is not in default in
     the payment of any taxes which were payable pursuant to said returns or any
     assessments with respect thereto; and the statements in the Prospectus
     under the headings "Taxation", "Description of Cumulative Preferred Stock"
     and "Description of Capital Stock" fairly summarize the matters therein
     described.

            (s)      No holder of any security of the Fund has any right to
     require registration of shares of Cumulative Preferred Stock or any other
     security of the Fund because of the filing of the registration statement or
     consummation of the transactions contemplated by this Agreement.

            (t)      The Fund, subject to the registration statement having been
     declared effective and the filing of the Prospectus under Rule 497, has
     taken all required action under the Acts and the Rules and Regulations to
     make the public offering and consummate the sale of the Securities as
     contemplated by this Agreement.

            (u)      The conduct by the Fund of its business (as described in
     the Prospectus) does not require it to be the owner, possessor or licensee
     of any patents, patent licenses, trademarks, service marks or trade names
     which it does not own, possess or license.

            (v)      The Fund is registered under the 1940 Act as a closed-end,
     diversified management investment company and the 1940 Act Notification has
     been duly filed with the Commission and, at the time of filing thereof and
     any amendment or supplement thereto, conformed in all material respects
     with all applicable provisions of the 1940 Act and the Rules and
     Regulations. The Fund is, and at all times through the completion of the
     transactions contemplated hereby will be, in compliance in all material
     respects with the terms and conditions of the Acts. No person is serving or
     acting as an officer, director or investment adviser of the Fund except in
     accordance with the provisions of the 1940 Act, the 1940 Act Rules and
     Regulations, the Advisers Act, and the Advisers Act Rules and Regulations;
     the Fund has not received any notice from the Commission pursuant to
     Section 8(e) of the 1940 Act with respect to the 1940 Act Notification or
     the Registration Statement.

                                       6

<PAGE>


            (w)      Except as stated in this Agreement and in the Prospectus
     (and any supplement thereto), the Fund has not taken, nor will it take,
     directly or indirectly, any action designed to or which might reasonably be
     expected to cause or result in stabilization or manipulation of the price
     of any securities issued by the Fund to facilitate the sale or resale of
     the Securities, and the Fund is not aware of any such action taken or to be
     taken by any affiliates of the Fund.

            (x)      The Fund has filed in a reasonably timely manner each
     document or report required to be filed by it pursuant to the Exchange Act
     and Exchange Act Rules and Regulations; each such document or report at the
     time it was filed conformed to the requirements of the Exchange Act and the
     Exchange Act Rules and Regulations; and none of such documents or reports
     contained an untrue statement of any material fact or omitted to state any
     material fact required to be stated therein or necessary to make the
     statements therein not misleading.

            (y)      Each of the Fund Agreements and the Fund's and the
     Adviser's obligations under this Agreement and each of the Fund Agreements
     comply in all material respects with all applicable provisions of the 1940
     Act, the 1940 Act Rules and Regulations, the Advisers Act and the Advisers
     Act Rules and Regulations.

            (z)      The Fund will use its reasonable best efforts to cause the
     Cumulative Preferred Stock, on or prior to the Closing Date, to be assigned
     a rating of "Aaa" by the Rating Agency.

            (aa)     At all times since its inception, as required by Subchapter
     M of the Code, the Fund has complied with the requirements to qualify as a
     regulated investment company under the Code.

            (bb)     Except as disclosed in the Registration Statement and the
     Prospectus (or any amendment or supplement to either of them), no director
     of the Fund is an "interested person" (as defined in the 1940 Act) of the
     Fund or an "affiliated person" (as defined in the 1940 Act) of any
     Underwriter.

            (cc)     The Fund will use its reasonable best efforts to cause the
     Cumulative Preferred Stock to be listed, subject to notice of issuance, on
     the NYSE within 30 days of the effectiveness of the Registration Statement
     and to comply with the rules and regulations of such exchange.

            (dd)     The Fund intends to direct the investment of the proceeds
     of the offering of the Securities in such a manner as to comply with the
     requirements of Subchapter M of the Code.

            (ee)     All advertising, sales literature or other promotional
     material (including "prospectus wrappers", "broker kits", "road show
     slides" and "road show scripts"), whether in printed or electronic form,
     authorized in writing by or prepared by the Fund or the Adviser for use in
     connection with the offering and sale of the Securities (collectively,
     "sales material"), if any, complied and comply in all material respects
     with the applicable requirements of the 1933 Act, the 1933 Act Rules and
     Regulations and the

                                       7

<PAGE>

     rules and interpretations of the NASD and if required to be filed with the
     NASD under the NASD's conduct rules were or will be so filed prior to the
     Closing. No sales material contained or contains an untrue statement of a
     material fact or omitted or omits to state a material fact necessary in
     order to make the statements therein, in the light of the circumstances
     under which they were made, not misleading.

            (ff)     The Fund's directors and officers/errors and omissions
     insurance policy and its fidelity bond required by Rule 17g-1 of the 1940
     Act Rules and Regulations are in full force and effect; the Fund is in
     compliance with the terms of such policy and fidelity bond in all material
     respects; and there are no claims by the Fund under any such policy or
     fidelity bond as to which any insurance company is denying liability or
     defending under a reservation of rights clause; the Fund has not been
     refused any insurance coverage sought or applied for; and the Fund has no
     reason to believe that it will not be able to renew its existing insurance
     coverage as and when such coverage expires or to obtain similar coverage
     from similar insurers as may be necessary to continue its business at a
     cost that would not have a material adverse effect on the condition
     (financial or otherwise), prospects, earnings, business or properties of
     the Fund, whether or not arising from transactions in the ordinary course
     of business, except as set forth in or contemplated in the Prospectus
     (exclusive of any supplement thereto).

            (gg)     Except as disclosed in the Registration Statement and the
     Prospectus, the Fund (i) does not have any material lending or other
     relationship with any affiliate of Citigroup Global Markets Inc. and (ii)
     does not intend to use any of the proceeds from the sale of the Securities
     hereunder to repay any outstanding debt owed to any affiliate of Citigroup
     Global Markets Inc.

            (hh)     There is and has been no failure on the part of the Fund
     and any of the Fund's directors or officers, in their capacities as such,
     to comply in all material respects with any provision of the Sarbanes-Oxley
     Act of 2002 and the rules and regulations promulgated in connection
     therewith (the "Sarbanes-Oxley Act"), including Sections 302 and 906
     related to certifications.

            (ii)     The operations of the Fund are and have been conducted at
     all times in compliance in all material respects with any applicable
     financial recordkeeping and reporting requirements of The Bank Secrecy Act
     of 1970, as amended (including amendments pursuant to the International
     Money Laundering Abatement and Anti-Terrorist Financing Act of 2001), the
     money laundering statutes of all jurisdictions, the rules and regulations
     thereunder and any related or similar rules, regulations or guidelines,
     issued, administered or enforced by any governmental agency (collectively,
     the "Money Laundering Laws") and no action, suit or proceeding by or before
     any court or governmental agency, authority or body or any arbitrator
     involving the Fund with respect to the Money Laundering Laws is pending or,
     to the knowledge of the Fund, threatened.

            (jj)     Neither the Fund nor, to the knowledge of the Fund, any
     director, officer, agent, employee or affiliate of the Fund is currently
     subject to any U.S. sanctions administered by the Office of Foreign Assets
     Control of the U.S. Treasury Department

                                       8

<PAGE>

     ("OFAC"); and the Fund will not directly or indirectly use the proceeds of
     the offering, or lend, contribute or otherwise make available such proceeds
     to any other person or entity, for the purpose of financing the activities
     of any person currently subject to any U.S. sanctions administered by OFAC.

            (kk)     Neither the Fund nor, to the knowledge of the Fund, any
     director, officer, agent, employee or affiliate of the Fund is aware of or
     has taken any action, directly or indirectly, that would result in a
     violation by such persons of the FCPA, including, without limitation,
     making use of the mails or any means or instrumentality of interstate
     commerce corruptly in furtherance of an offer, payment, promise to pay or
     authorization of the payment of any money, or other property, gift, promise
     to give, or authorization of the giving of anything of value to any
     "foreign official" (as such term is defined in the FCPA) or any foreign
     political party or official thereof or any candidate for foreign political
     office, in contravention of the FCPA and the Fund, and, to the knowledge of
     the Fund, its affiliates have conducted their businesses in compliance with
     the FCPA and have instituted and maintain policies and procedures designed
     to ensure, and which are reasonably expected to continue to ensure,
     continued compliance therewith.

            Any certificate signed by any officer of the Fund and delivered to
the Representatives or counsel for the Underwriters in connection with the
offering of the Securities shall be deemed a representation and warranty by the
Fund, as to matters covered thereby, to each Underwriter.

            2.       Representations and Warranties of the Adviser. The Adviser
represents and warrants to each Underwriter as follows:

            (a)      The Adviser is a limited liability company duly formed and
     validly existing in good standing under the laws of the State of Delaware,
     with full corporate power and authority to own, lease and operate its
     property or assets and to conduct its business as described in the
     Registration Statement and the Prospectus (and any amendment or supplement
     to either of them), and is duly registered and qualified to conduct its
     business and is in good standing in each jurisdiction or place where the
     nature of its property or assets or the conduct of its business requires
     such registration or qualification, except where the failure to so register
     or to qualify does not have a material adverse effect on the condition
     (financial or other), business, prospects, property, net assets or results
     of operations of the Adviser, or on the ability of the Adviser to perform
     its obligations under this Agreement and the Investment Advisory Agreement.

            (b)      The Adviser is duly registered with the Commission as an
     investment adviser under the Advisers Act and is not prohibited by the
     Advisers Act, the Advisers Act Rules and Regulations, the 1940 Act or the
     1940 Act Rules and Regulations from acting under the Investment Advisory
     Agreement for the Fund as contemplated by the Prospectus (or any supplement
     thereto). There does not exist any proceeding or, to the Adviser's
     knowledge, any facts or circumstances the existence of which could
     reasonably lead to any proceeding, which might adversely affect the
     registration of the Adviser with the Commission.

                                       9

<PAGE>


            (c)      There are no legal or governmental proceedings pending or,
     to the knowledge of the Adviser, threatened against the Adviser, or to
     which the Adviser or any of its property or assets is subject, that are
     required to be described in the Registration Statement or the Prospectus
     (or any amendment or supplement to either of them) but are not described as
     required or that may reasonably be expected to involve a prospective
     material adverse change, in the condition (financial or other), business,
     prospects, property, net assets or results of operations of the Adviser or
     on the ability of the Adviser to perform its obligations under this
     Agreement and the Investment Advisory Agreement.

            (d)      Neither the execution, delivery or performance of this
     Agreement or the Investment Advisory Agreement by the Adviser, nor the
     consummation by the Adviser of the transactions contemplated hereby or
     thereby (i) requires the Adviser to obtain any consent, approval,
     authorization or other order of or registration with, the Commission, any
     state securities commission, any national securities exchange, any
     arbitrator, any court, regulatory body, administrative agency or other
     governmental body, agency or official, (ii) violates or will violate or
     conflicts or will conflict with any provision of the certificate of
     formation or by-laws or other organizational documents of the Adviser or
     any statute, law, regulation or judgment, injunction, order or decree
     applicable to the Adviser or any of its property or assets or (iii)
     conflicts or will conflict with or constitutes or will constitute a breach
     of or a default under, any agreement, indenture, lease or other instrument
     to which the Adviser is a party or by which it or any of its property or
     assets may be bound, or will result in the creation or imposition of any
     lien, charge or encumbrance upon any property or assets of the Adviser
     pursuant to the terms of any agreement or instrument to which it is a party
     or by which it may be bound or to which any of the property or assets of
     the Adviser is subject. The Adviser is not subject to any order of any
     court or of any arbitrator, governmental authority or administrative
     agency.

            (e)      The execution and delivery of, and the performance by the
     Adviser of its obligations under, this Agreement and the Investment
     Advisory Agreement have been duly and validly authorized by the Adviser,
     and this Agreement and the Investment Advisory Agreement have been duly
     executed and delivered by the Adviser and each constitutes the valid and
     legally binding agreement of the Adviser, enforceable against the Adviser
     in accordance with its terms except as rights to indemnity and contribution
     hereunder may be limited under federal or state securities laws.

            (f)      The Adviser has the financial resources available to it
     necessary for the performance of its services and obligations as
     contemplated in the Prospectus (or any supplement thereto) and under this
     Agreement and the Investment Advisory Agreement.

            (g)      The description of the Adviser in the Registration
     Statement and the Prospectus (and any amendment or supplement to either of
     them) complied and comply in all material respects with the provisions the
     Acts, the Advisers Act, the Rules and Regulations, and the Advisers Act
     Rules and Regulations and such description did not, as of the effective
     date of the Registration Statement and the date hereof, and will not, as of
     the Closing Date, contain an untrue statement of a material fact or omit to
     state a material fact required to be stated therein or necessary to make
     the statements therein, in the light of the circumstances under which they
     were made, not misleading.

                                       10

<PAGE>

            (h)      Except as disclosed in the Registration Statement and the
     Prospectus (or any amendment or supplement to either of them), subsequent
     to the respective dates as of which such information is given in the
     Registration Statement and the Prospectus (or any amendment or supplement
     to either of them), the Adviser has not incurred any liability or
     obligation, direct or contingent, or entered into any transaction, not in
     the ordinary course of business, that is material to the Fund, and there
     has not been any material adverse change, or any development involving or
     which may reasonably be expected to involve, a prospective material adverse
     change, in the condition (financial or other), business, prospects,
     property, net assets or results of operations of the Adviser, whether or
     not arising in the ordinary course of business, or which, in each case,
     could have a material adverse effect on the ability of the Adviser to
     perform its obligations under this Agreement and the Investment Advisory
     Agreement..

            (i)      The Adviser has such permits, licenses, franchises and
     authorizations of governmental or regulatory authorities ("permits") as are
     necessary to own its property and assets and to conduct its business in the
     manner described in the Prospectus (and any supplement thereto); the
     Adviser has fulfilled and performed all its material obligations with
     respect to such permits, and to the Adviser's knowledge no event has
     occurred which allows, or after notice or lapse of time would allow,
     revocation or termination thereof or results in any other material
     impairment of the rights of the Adviser under any such permit; and, except
     as described in the Prospectus (and any supplement thereto), none of such
     permits contains any restriction that is materially burdensome to the
     Adviser

            (j)      Except as stated in this Agreement and in the Prospectus
     (and any supplement thereto), the Adviser has not taken, nor will it take,
     directly or indirectly, any action designed to or which might reasonably be
     expected to cause or result in, stabilization or manipulation of the price
     of any securities issued by the Fund to facilitate the sale or resale of
     the Securities, and the Adviser is not aware of any such action taken or to
     be taken by any affiliates of the Adviser.

            (k)      Charles M. Royce is the validly appointed President of the
     Adviser.

            (l)      In the event that the Fund or the Adviser makes available
     any promotional materials intended for use only by qualified broker-dealers
     and registered representatives thereof by means of an Internet web site or
     similar electronic means, the Adviser will install and maintain
     pre-qualification and password-protection or similar procedures which are
     reasonably designed to effectively prohibit access to such promotional
     materials by persons other than qualified broker-dealers and registered
     representatives thereof.

            (m)      This Agreement and the Investment Advisory Agreement comply
     in all material respects with all applicable provisions of the 1940 Act,
     the 1940 Act Rules and Regulations, the Advisers Act and the Advisers Act
     Rules and Regulations.

            3.       Purchase and Sale. Subject to the terms and conditions and
in reliance upon the representations and warranties herein set forth, the Fund
agrees to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase from the Fund, at a purchase

                                       11

<PAGE>

price of $_____ per share, the number of the Underwritten Securities set forth
opposite such Underwriter's name in Schedule I hereto.

            4.       Delivery and Payment. Delivery of and payment for the
Underwritten Securities shall be made at 10:00 AM, New York City time, on
______, ___, 2003 or at such time on such later date not more than three
Business Days after the foregoing date as the Representatives shall designate,
which date and time may be postponed by agreement between the Representatives
and the Fund or as provided in Section 10 hereof (such date and time of delivery
and payment for the Securities being herein called the "Closing Date"). Delivery
of the Securities shall be made to the Representatives for the respective
accounts of the several Underwriters against payment by the several Underwriters
through the Representatives of the purchase price thereof to or upon the order
of the Fund by wire transfer payable in same-day funds to an account specified
by the Fund. Delivery of the Underwritten Securities shall be made through the
facilities of The Depository Trust Company unless the Representatives shall
otherwise instruct.

            5.       Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Securities for sale to the public as set forth
in the Prospectus.

            6.       Agreements of the Fund and the Adviser. The Fund and the
Adviser, jointly and severally, agree with the several Underwriters as follows:

            (a)      The Fund will use its best efforts to cause the
     Registration Statement, if not effective at the Execution Time, and any
     amendment thereto, to become effective. Prior to the termination of the
     offering of the Securities, the Fund will not file any amendment of the
     Registration Statement or supplement to the Prospectus or any Rule 462(b)
     Registration Statement unless the Fund has furnished you a copy for your
     review prior to filing and will not file any such proposed amendment or
     supplement to which you reasonably object. Subject to the foregoing
     sentence, if the Registration Statement has become or becomes effective
     pursuant to Rule 430A, or filing of the Prospectus is otherwise required
     under Rule 497, the Fund will cause the Prospectus, properly completed, and
     any supplement thereto to be filed in a form approved by the
     Representatives with the Commission pursuant to Rule 497 within the time
     period prescribed and will provide evidence satisfactory to the
     Representatives of such timely filing. The Fund will promptly advise the
     Representatives (1) when the Registration Statement, if not effective at
     the Execution Time, shall have become effective, (2) when the Prospectus,
     and any supplement thereto, shall have been filed (if required) with the
     Commission pursuant to Rule 497 or when any Rule 462(b) Registration
     Statement shall have been filed with the Commission, (3) when, prior to
     termination of the offering of the Securities, any amendment to the
     Registration Statement shall have been filed or become effective, (4) of
     any request by the Commission or its staff for any amendment of the
     Registration Statement, or any Rule 462(b) Registration Statement, or for
     any supplement to the Prospectus or for any additional information, (5) of
     the issuance by the Commission of any stop order suspending the
     effectiveness of the Registration Statement or the institution or
     threatening of any proceeding for that purpose and (6) of the receipt by
     the Fund of any notification with respect to the suspension of the
     qualification of the Securities for sale in any jurisdiction or the
     institution or threatening of any proceeding

                                       12
<PAGE>

     for such purpose. The Fund will use its best efforts to prevent the
     issuance of any such stop order or the suspension of any such qualification
     and, if issued, to obtain as soon as possible the withdrawal thereof.

            (b)      If, at any time when a prospectus relating to the
     Securities is required to be delivered under the 1933 Act, any event occurs
     as a result of which, in the judgment of the Fund or in the reasonable
     opinion of counsel for the Underwriters, the Prospectus as then
     supplemented would include any untrue statement of a material fact or omit
     to state any material fact necessary to make the statements therein, in the
     light of the circumstances under which they were made, not misleading, or
     if it shall be necessary to amend the Registration Statement or supplement
     the Prospectus to comply with the 1933 Act, the 1940 Act and the Rules and
     Regulations, the Fund promptly will (1) notify the Representatives of any
     such event; (2) prepare and file with the Commission, subject to the second
     sentence of paragraph (a) of this Section 6, an amendment or supplement
     which will correct such statement or omission or effect such compliance;
     and (3) supply any supplemented Prospectus to you in such quantities as you
     may reasonably request.

            (c)      As soon as practicable, the Fund will make generally
     available to its security holders and to the Representatives an earnings
     statement or statements of the Fund which will satisfy the provisions of
     Section 11(a) of the 1933 Act and Rule 158 under the 1933 Act.

            (d)      The Fund will furnish to the Representatives and counsel
     for the Underwriters signed copies of the Registration Statement (including
     exhibits thereto) and to each other Underwriter a copy of the Registration
     Statement (without exhibits thereto) and, so long as delivery of a
     prospectus by an Underwriter or dealer may be required by the 1933 Act, as
     many copies of each Preliminary Prospectus and the Prospectus and any
     supplement thereto as the Representatives may reasonably request.

            (e)      The Fund will arrange, if necessary, for the qualification
     of the Securities for sale under the laws of such jurisdictions as the
     Representatives may designate and will maintain such qualifications in
     effect so long as required for the distribution of the Securities; provided
     that in no event shall the Fund be obligated to qualify to do business in
     any jurisdiction where it is not now so qualified or to take any action
     that would subject it to service of process in suits, other than those
     arising out of the offering or sale of the Securities, in any jurisdiction
     where it is not now so subject.

            (f)      The Fund will not, without the prior written consent of
     Citigroup Global Markets Inc., offer, sell, contract to sell, pledge, or
     otherwise dispose of (or enter into any transaction which is designed to,
     or might reasonably be expected to, result in the disposition (whether by
     actual disposition or effective economic disposition due to cash settlement
     or otherwise) by the Fund or any affiliate of the Fund or any person in
     privity with the Fund, directly or indirectly, including the filing (or
     participation in the filing) of a registration statement with the
     Commission in respect of, or establish or increase a put equivalent
     position or liquidate or decrease a call equivalent position within the
     meaning of Section 16 of the Exchange Act) any other senior security of the
     Fund or any securities convertible into, or exercisable, or exchangeable
     for, any senior security of the Fund; or

                                       13

<PAGE>

     publicly announce an intention to effect any such transaction for a period
     of 180 days following the Execution Time.

            (g)      The Fund will comply with all applicable securities and
     other applicable laws, rules and regulations, including, without
     limitation, the Sarbanes-Oxley Act, and to use its best efforts to cause
     the Fund's directors and officers, in their capacities as such, to comply
     with such laws, rules and regulations, including, without limitation, the
     provisions of the Sarbanes-Oxley Act.

            (h)      The Fund and the Adviser will not take, directly or
     indirectly, any action designed to or that would constitute or that might
     reasonably be expected to cause or result in, under the Exchange Act or
     otherwise, stabilization or manipulation of the price of any security of
     the Fund to facilitate the sale or resale of the Securities.

            (i)      The Fund agrees to pay the costs and expenses relating to
     the following matters: (A) the preparation, printing or reproduction and
     filing with the Commission of the Registration Statement (including
     financial statements and exhibits thereto), each Preliminary Prospectus,
     the Prospectus and the 1940 Act Notification and each amendment or
     supplement to any of them; (B) the printing (or reproduction) and delivery
     (including postage, air freight charges and charges for counting and
     packaging) of such copies of the Registration Statement, each Preliminary
     Prospectus, the Prospectus, any sales material and all amendments or
     supplements to any of them, as may, in each case, be reasonably requested
     for use in connection with the offering and sale of the Securities; (C) the
     preparation, printing, authentication, issuance and delivery of
     certificates for the Securities, including any stamp or transfer taxes in
     connection with the original issuance and sale of the Securities; (D) the
     printing (or reproduction) and delivery of this Agreement, any blue sky
     memorandum, dealer agreements and all other agreements or documents printed
     (or reproduced) and delivered in connection with the offering of the
     Securities; (E) the registration of the Securities under the 1933 Act and
     the listing of the Securities on the NYSE; (F) any registration or
     qualification, if necessary, of the Securities for offer and sale under the
     securities or blue sky laws of the several states (including filing fees
     and the reasonable fees and expenses of counsel for the Underwriters
     relating to such registration and qualification); (G) any filings required
     to be made with the NASD (including filing fees and the reasonable fees and
     expenses of counsel for the Underwriters relating to such filings); (H) the
     transportation and other expenses incurred by or on behalf of Fund
     representatives in connection with presentations to prospective purchasers
     of the Securities; (I) the fees and expenses of the Fund's accountants and
     the fees and expenses of counsel (including local and special counsel) for
     the Fund; (J) the fees payable to the Rating Agency; and (K) all other
     costs and expenses incident to the performance by the Fund of its
     obligations hereunder, but not including the fees, expenses, and costs of
     Simpson Thacher & Bartlett LLP, counsel to the Underwriters, except as
     provided in Sections 6(i)(D) and (G) and in Section 8 of this Agreement

            (j)      The Fund will direct the investment of the net proceeds of
     the offering of the Securities in such a manner as to comply with the
     investment objectives, policies and restrictions of the Fund as described
     in the Prospectus.

                                       14

<PAGE>

            (k)      The Fund will use its best efforts to cause the Cumulative
     Preferred Stock to be listed, subject to notice of issuance, on the NYSE
     within 30 days of effectiveness of the Registration Statement and to comply
     with the rules and regulations of such exchange.

            (l)      The Fund will use its best efforts to cause the Cumulative
     Preferred Stock, on or prior to the Closing Date, to be assigned a rating
     of "Aaa" by the Rating Agency.

            (m)      The Fund will comply with the requirements of Subchapter M
     of the Code to qualify as a regulated investment company under the Code.

            (n)      The Fund and the Adviser will use their reasonable best
     efforts to perform all of the agreements required of them by this Agreement
     and discharge all conditions of theirs to closing as set forth in this
     Agreement.

            7.       Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Securities, as the case may be,
shall be subject to the accuracy of the representations and warranties on the
part of the Fund and the Adviser contained herein as of the Execution Time, the
Closing Date and any settlement date pursuant to Section 4 hereof, to the
accuracy of the statements of the Fund made in any certificates pursuant to the
provisions hereof, to the performance by the Fund or the Adviser of its
obligations hereunder and to the following additional conditions:

            (a)      If the Registration Statement has not become effective
     prior to the Execution Time, unless the Representatives agree in writing to
     a later time, the Registration Statement will become effective not later
     than (i) 6:00 PM New York City time on the date of determination of the
     public offering price, if such determination occurred at or prior to 3:00
     PM New York City time on such date or (ii) 9:30 AM on the Business Day
     following the day on which the public offering price was determined, if
     such determination occurred after 3:00 PM New York City time on such date;
     if filing of the Prospectus, or any supplement thereto, is required
     pursuant to Rule 497, the Prospectus, and any such supplement, will be
     filed in the manner and within the time period required by Rule 497; and no
     stop order suspending the effectiveness of the Registration Statement shall
     have been issued by the Commission and no proceedings for that purpose
     shall have been instituted or threatened by the Commission.

            (b)      The Fund shall have requested and caused Sidley Austin
     Brown & Wood LLP, special counsel for the Fund, to have furnished to the
     Representatives their opinion, dated the Closing Date and addressed to the
     Representatives, to the effect that:

                     (i)    the Fund is qualified to do business and is in good
            standing as a foreign corporation in the State of New York, and, to
            such counsel's knowledge, owns, possesses or has obtained and
            currently maintains, all material governmental licenses, permits,
            consents, orders, approvals and other authorizations under the
            Federal laws of the United States and the laws of the State of New
            York necessary to carry on its business as contemplated by the
            Prospectus;

                                       15

<PAGE>


                     (ii)   the Securities have been duly authorized and, when
            issued and delivered in accordance with the terms of this Agreement,
            will be validly issued, fully paid and non-assessable;

                     (iii)  this Agreement has been duly authorized, executed
            and delivered by the Fund and complies with the provisions of the
            1940 Act and the 1940 Act Rules and Regulations applicable to the
            Fund;

                     (iv)   each of the Fund Agreements has been duly
            authorized, executed and delivered by the Fund, each complies as to
            form in all material respects with all applicable provisions of the
            1940 Act and the 1940 Act Rules and Regulations;

                     (v)    the Registration Statement is effective under the
            1933 Act and the 1933 Act Rules and Regulations and, to such
            counsel's knowledge, no stop order suspending the effectiveness of
            the Registration Statement has been issued under the 1933 Act or the
            1933 Act Rules and Regulations or proceedings therefor initiated or
            threatened by the Commission;

                     (vi)   at the time the Registration Statement became
            effective, the Registration Statement (other than the financial
            statements, accompanying notes, and other financial or statistical
            information contained or incorporated by reference therein, as to
            which no opinion need be rendered) complied as to form in all
            material respects with the requirements of the Acts and the Rules
            and Regulations;

                     (vii)  to such counsel's knowledge, (A) there are no
            contracts, indentures, mortgages, loan agreements, notes, leases or
            other instruments of the Fund required to be described or referred
            to in the Registration Statement or to be filed as exhibits thereto
            other than those described or referred to therein or filed as
            exhibits thereto, (B) the descriptions thereof are correct in all
            material respects, (C) references thereto are correct and (D) no
            default exists in the due performance or observance by the Fund of
            any material obligation, agreement, covenant or condition contained
            in any contract, indenture, mortgage, loan agreement, note, lease or
            other instrument so described, referred to or filed as an exhibit to
            the Registration Statement;

                     (viii) no consent, approval, authorization or order of any
            court or governmental authority or agency is required in connection
            with the performance by the Fund of its obligations under this
            Agreement, except for (A) such as may be required under state
            securities or Blue Sky laws in connection with the purchase and
            distribution of the Securities by you, (B) the required rating
            agency confirmation (as to which such counsel need express no
            opinion), (C) such as have been made or obtained under the 1933 Act,
            and (D) such as may have been obtained under Maryland law; and to
            such counsel's knowledge, the execution and delivery of this
            Agreement and the consummation of the transactions contemplated
            herein will not conflict with or constitute a breach of, or a
            default under, or result in the creation or imposition of any lien,
            charge or encumbrance

                                       16

<PAGE>

            upon any property or assets of the Fund pursuant to, any contract,
            indenture, mortgage, loan agreement, note, lease or other instrument
            to which the Fund is a party or by which it may be bound or to which
            any of the property or assets of the Fund is subject, nor will such
            action result in any violation of the provisions of the Charter or
            the bylaws of the Fund, or, to such counsel's knowledge, any Federal
            or New York law or administrative regulation, or administrative or
            court decree;

                     (ix)   the Fund is registered with the Commission under the
            1940 Act and the 1940 Act Rules and Regulations as a closed-end,
            diversified management investment company, and all required action
            has been taken by the Fund under the Acts and the Rules and
            Regulations to make the public offering and consummate the sale of
            the Securities pursuant to this Agreement; the provisions of the
            Charter and the bylaws of the Fund comply as to form in all material
            respects with the requirements of the 1940 Act and the 1940 Act
            Rules and Regulations; and, to such counsel's knowledge, no order of
            suspension or revocation of such registration under the 1940 Act and
            the 1940 Act Rules and Regulations, has been issued or proceedings
            therefor initiated or threatened by the Commission;

                     (x)    the information in the Prospectus under the caption
            "Taxation", to the extent that it constitutes matters of Federal
            income tax law or legal conclusions relating to Federal income tax
            matters, has been reviewed by them and is correct in all material
            respects; and

                     (xi)   to the knowledge of such counsel, there is no
            pending or threatened action, suit or proceeding by or before any
            court or governmental agency, authority or body or any arbitrator
            involving the Fund or its property of a character required to be
            disclosed in the Registration Statement which is not adequately
            disclosed in the Prospectus.

     In rendering such opinion, Sidley Austin Brown & Wood LLP shall
     additionally state that nothing has come to their attention that has caused
     them to believe that the Registration Statement or any amendment thereto,
     at the time it became effective, contained an untrue statement of a
     material fact or omitted to state a material fact required to be stated
     therein or necessary to make the statements therein not misleading, or that
     the Prospectus or any supplement thereto, as of the time it was first
     provided to the Underwriters or as of the Closing Date, included an untrue
     statement of a material fact or omitted to state a material fact necessary
     in order to make the statements therein, in the light of the circumstances
     under which they were made, not misleading, except that such counsel need
     not express any belief with respect to the financial statements,
     accompanying notes, and other financial and statistical information
     contained or incorporated by reference in the Registration Statement and
     the Prospectus (and any amendment or supplement to either of the
     foregoing). In addition, Sidley Austin Brown & Wood LLP (A) may state that
     they express no opinion as to the laws of any jurisdiction other than the
     laws of the State of New York, the laws of the State of Maryland and the
     Federal laws of the United States of America, (B) may rely as to matters
     involving the laws of the State of Maryland upon the opinion of Venable,
     Baetjer and Howard, LLP referred to in paragraph (c) of

                                       17

<PAGE>

     this Section 7 and (C) may rely, as to matters of fact, upon the
     representations and warranties made by the Fund and the Adviser herein and
     on certificates and written statements of officers and employees of and
     accountants for the Fund and the Adviser and of public officials. Except as
     otherwise specifically provided herein, when giving their opinions to their
     "knowledge", Sidley Austin Brown & Wood LLP have relied solely upon an
     inquiry of the attorneys of that firm who have worked on matters for the
     Fund, on certificates or written statements of officers of the Fund and,
     where appropriate, a review of the Registration Statement, Prospectus,
     exhibits to the Registration Statement, the Charter and bylaws of the Fund
     and a review of the minute books of the Fund and have made no other
     investigation or inquiry.

            (c)      You shall have received on the Closing Date an opinion of
     Venable, LLP, special Maryland counsel to the Fund, dated the Closing Date
     and addressed to you, to the effect that:

                     (i)    the Fund is a corporation duly incorporated and
            existing under and by virtue of the laws of the State of Maryland
            and is in good standing with the SDAT;

                     (ii)   the Fund has the corporate power to own, lease and
            operate its property or assets and to conduct its business in all
            material respects as described in the Registration Statement and in
            the Prospectus;

                     (iii)  the authorized capital stock of the Fund conforms as
            to legal matters in all material respects to the description thereof
            in the Prospectus under the captions "Description of Cumulative
            Preferred Stock" and "Description of Capital Stock";

                     (iv)   the sale and issuance of Securities have been duly
            authorized and, when issued and delivered in accordance with the
            terms of this Agreement, will be validly issued, fully paid and non-
            assessable, and the issuance of the Securities will not be subject
            to preemptive or other similar rights pursuant to the Charter or
            Bylaws of the Fund or the Maryland General Corporation Law.

                     (v)    the Fund has the corporate power to enter into the
            Fund Agreements; the execution and delivery of the Fund Agreements
            have been duly authorized by the Fund; each of the Fund Agreements
            has been duly executed and, so far as it is known to such counsel,
            delivered by the Fund;

                     (vi)   so far as is known to such counsel, the execution
            and delivery of this Agreement and the consummation of the
            transactions contemplated hereby will not conflict with or
            constitute a breach of the Charter or the Bylaws of the Fund, or any
            Maryland law or regulation, or, so far as is known to such counsel,
            any order of any Maryland governmental authority (other than any
            law, regulation or order in connection with the securities laws of
            the State of Maryland, as to which no opinion is hereby expressed);
            and

                                       18

<PAGE>

                     (vii)  insofar as statements in the Prospectus purport to
            summarize certain provisions of Maryland law or regulations or legal
            or governmental proceedings, of the State of Maryland, if any, such
            statements are accurate in all material respects.

            In rendering such opinion, Venable LLP may rely, as to matters of
     fact, upon the representations and warranties made by the Fund and the
     Adviser herein and on certificates and written statements of officers and
     employees of and accountants for the Fund and the Adviser and of public
     officials. Except as otherwise specifically provided herein, when giving
     their opinions to their "knowledge", Venable LLP have relied solely upon an
     inquiry of the attorneys of that firm who have worked on matters for the
     Fund, on certificates or written statements of officers of the Fund and,
     where appropriate, a review of the Registration Statement, Prospectus,
     exhibits to the Registration Statement, the Charter and bylaws of the Fund
     and have made no other investigation or inquiry.

            (d)      You shall have received on the Closing Date an opinion of
     John E. Denneen, Esq., General Counsel for the Adviser, dated the Closing
     Date and addressed to you, as Representatives of the several Underwriters,
     to the effect that:

                     (i)    the Adviser has been duly formed and is validly
            existing as a limited liability company in good standing under the
            laws of the State of Delaware, with corporate power and authority to
            conduct its business as described in the Registration Statement and
            in the Prospectus;

                     (ii)   the Adviser is duly registered as an investment
            adviser under the Advisers Act and the Advisers Act Rules and
            Regulations and, subject to the matters covered by the no-action
            letters of the Commission in Quest Advisory Corp.; Royce Value
            Trust, Inc. (pub. avail. December 22, 1986) and Royce Value Trust,
            Inc. (pub. avail. July 29, 1988) (collectively, the "No-Action
            Letters"), is not prohibited by the Advisers Act, the Advisers Act
            Rules and Regulations, the 1940 Act or the 1940 Act Rules and
            Regulations, from acting under the Investment Advisory Agreement for
            the Fund as contemplated by the Prospectus;

                     (iii)  this Agreement and the Investment Advisory Agreement
            each has been duly authorized, executed and delivered by the Adviser
            and, subject to the matters covered by the No-Action Letters,
            constitutes a valid and binding obligation of the Adviser,
            enforceable in accordance with its terms, subject, as to
            enforcement, to bankruptcy, insolvency, reorganization or other laws
            relating to or affecting creditors' rights generally and to general
            equitable principles (except as to those provisions relating to
            indemnity or contribution for liabilities arising under such
            agreement, as to which no opinion need be expressed); and, to his
            knowledge, neither the execution and delivery of this Agreement or
            the Investment Advisory Agreement nor the performance by the Adviser
            of its obligations hereunder or thereunder will conflict with, or
            result in a breach of, any of the terms and provisions of, or
            constitute, with or without the giving of notice or the lapse of
            time or both, a default under, any agreement or instrument to which
            the Adviser is a party or by which the Adviser is bound, or, except
            as set

                                       19

<PAGE>

            forth in the No-Action Letters, any law, order, rule or regulation
            applicable to the Adviser of any jurisdiction, court, Federal or
            state regulatory body, administrative agency or other governmental
            body, stock exchange or securities association having jurisdiction
            over the Adviser or its property or assets or operations;

                     (iv)   to such counsel's knowledge, the description of the
            Adviser in the Registration Statement and in the Prospectus (and any
            amendment or supplement to either of them) does not contain any
            untrue statement of a material fact or omit to state any material
            fact required to be stated therein or necessary to make the
            statements therein not misleading;

                     (v)    to the best knowledge of such counsel after
            reasonable inquiry, other than as described or contemplated in the
            Prospectus, there are no actions, suits or other legal or
            governmental proceedings pending or threatened against the Adviser
            or to which the Adviser or any of its property is subject which are
            required to be described in the Prospectus; and

                     (vi)   no material consent, approval, authorization or
            order of or registration or filing with any court, regulatory body,
            administrative or other governmental body, agency or official is
            required on the part of the Adviser for the performance of this
            Agreement or the Investment Advisory Agreement or for the
            consummation by the Adviser of the transactions contemplated hereby
            or thereby.

     In rendering such opinion, such counsel (A) may state that he expresses
     no opinion as to the laws of any jurisdiction other than the laws of the
     State of New York, the laws of the State of Delaware and the federal laws
     of the United States of America, (B) may rely, as to matters of fact, upon
     the representations and warranties made by the Fund and the Adviser herein
     and on certificates and written statements of officers and employees of and
     accountants for the Fund and the Adviser and of public officials, and (C)
     may state that he is a member of the Bar of the State of New York.

            (e)      The Representatives shall have received on the Closing Date
     an opinion of Simpson Thacher & Bartlett LLP, counsel to the Underwriters,
     dated the Closing Date and addressed to the Representatives, with respect
     to such matters as the Underwriters may reasonably request.

            (f)      The Fund shall have furnished to the Representatives a
     certificate of the Fund, signed by the Chairman of the Board or the
     President and the principal financial or accounting officer of each of the
     Fund and the Adviser, dated the Closing Date, to the effect that the
     signers of such certificate have carefully examined the Registration
     Statement, the Prospectus, any supplements to the Prospectus, and this
     Agreement and that:

            (i)      The representations and warranties of the Fund and the
     Adviser in this Agreement are true and correct on and as of the Closing
     Date with the same effect as if made on the Closing Date and the Fund and
     the Adviser have complied with

                                       20

<PAGE>


     all the agreements and satisfied all the conditions on its part to be
     performed or satisfied at or prior to the Closing Date;

            (ii)     No stop order suspending the effectiveness of the
     Registration Statement has been issued and no proceedings for that purpose
     have been instituted by the Commission or, to the Fund's or the Adviser's
     knowledge, threatened by the Commission; and

            (iii)    Since the date of the most recent financial statements
     included in the Prospectus (exclusive of any supplement thereto), there has
     been no material adverse effect on the condition (financial or otherwise),
     prospects, earnings, business or properties of the Fund or the Adviser,
     whether or not arising from transactions in the ordinary course of
     business, except as set forth in or contemplated in the Prospectus
     (exclusive of any supplement thereto).

     (g)    The Fund shall have requested and caused Tait, Weller & Baker, the
independent public accountants to the Fund, to have furnished to the
Representatives, at the Execution Time and at the Closing Date, letters, dated
respectively as of the Execution Time and as of the Closing Date, in form and
substance heretofore approved by the Representatives.

     (h)    Subsequent to the Execution Time or, if earlier, the dates as of
which information is given in the Registration Statement (exclusive of any
amendment thereof) and the Prospectus (exclusive of any supplement thereto),
there shall not have been (i) any change or decrease specified in the letter or
letters referred to in paragraph (g) of this Section 7 or (ii) any change, or
any development involving a prospective change, in or affecting the condition
(financial or otherwise), earnings, business or properties of the Fund and the
Adviser, whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Prospectus (exclusive of
any supplement thereto) the effect of which, in any case referred to in clause
(i) or (ii) above, is, in the sole judgment of the Representatives, so material
and adverse as to make it impractical or inadvisable to proceed with the
offering or delivery of the Securities as contemplated by the Registration
Statement (exclusive of any amendment thereof) and the Prospectus (exclusive of
any supplement thereto).

     (i)    The Fund shall have furnished to you a report showing compliance
with the asset coverage requirements of the 1940 Act and a Basic Maintenance
Report, each dated the Closing Date and in the form and substance satisfactory
to you. Each such report shall assume receipt of the net proceeds from the sale
of the Securities and the use of such net proceeds to redeem the 7.80% Preferred
and the 7.30% Preferred as contemplated by the Prospectus and may use portfolio
holdings and valuations as of the close of business of any day not more than six
business days preceding the Closing Date, provided, however, that the Fund
represents in such report that its total net assets as of the Closing Date have
not declined by 5% or more from such valuation date.

     (j)    The Fund shall have delivered and the Underwriters shall have
received evidence satisfactory to the Underwriters that the Cumulative Preferred
Stock is rated

                                       21

<PAGE>

"Aaa" by the Rating Agency as of the Closing Date, and there shall not have been
given any notice of any intended or potential downgrading, or any review for a
potential downgrading, in the rating according to the shares of the Cumulative
Preferred Stock by the Rating Agency.

     (k)    Prior to the Closing Date, the Fund and the Adviser shall have
furnished to the Representatives such further information, certificates and
documents as the Representatives may reasonably request.

     If any of the conditions specified in this Section 7 shall not have been
fulfilled when and as provided in this Agreement, or if any of the opinions and
certificates mentioned above or elsewhere in this Agreement shall not be
reasonably satisfactory in form and substance to the Representatives and counsel
for the Underwriters, this Agreement and all obligations of the Underwriters
hereunder may be canceled at, or at any time prior to, the Closing Date by the
Representatives. Notice of such cancellation shall be given to the Fund in
writing or by telephone or facsimile confirmed in writing.

     The documents required to be delivered by this Section 7 shall be delivered
at the office of Simpson Thacher & Bartlett LLP, counsel for the Underwriters,
at 425 Lexington Avenue, New York, New York, 10017, Attention: Cynthia G.
Cobden, Esq., on the Closing Date.

     8.     Reimbursement of Underwriters' Expenses. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 7 hereof is not satisfied,
because of any termination pursuant to Section 11 hereof or because of any
refusal, inability or failure on the part of the Fund or the Adviser to perform
any agreement herein or comply with any provision hereof other than by reason of
a default by any of the Underwriters, the Fund will reimburse the Underwriters
severally through Citigroup Global Markets Inc. on demand for all out-of-pocket
expenses (including reasonable fees and disbursements of counsel) that shall
have been incurred by them in connection with the proposed purchase and sale of
the Securities.

     9.     Indemnification and Contribution. (a) The Fund and the Adviser,
jointly and severally, agree to indemnify and hold harmless each of the
Representatives and each other Underwriter, the directors, officers, employees
and agents of each Underwriter and each person who controls any Underwriter
within the meaning of the 1933 Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several (including reasonable
costs of investigation), to which they or any of them may become subject under
the 1933 Act, the Exchange Act or other Federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement, the Prospectus, any Preliminary Prospectus, any
sales material (or any amendment or supplement to any of the foregoing), or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, and agrees to reimburse each such indemnified
party, as incurred, for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action;

                                       22

<PAGE>

provided, however, that the Fund will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with written
information furnished to the Fund by or on behalf of any Underwriter through the
Representatives specifically for inclusion therein. This indemnity agreement
will be in addition to any liability which the Fund may otherwise have.

     (b)    Each Underwriter severally and not jointly agrees to indemnify and
hold harmless the Fund and the Adviser, each of its directors, each of its
officers who signs the Registration Statement, and each person who controls the
Fund or the Advisers within the meaning of either the 1933 Act or the Exchange
Act, to the same extent as the foregoing indemnity from the Fund and the
Advisers to each Underwriter, but only with reference to written information
relating to such Underwriter furnished to the Fund by or on behalf of such
Underwriter through the Representatives specifically for inclusion in the
documents referred to in the foregoing indemnity. This indemnity agreement will
be in addition to any liability which any Underwriter may otherwise have. The
Fund and the Adviser acknowledge that the statements set forth in the last
paragraph of the cover page regarding delivery of the Securities and, under the
heading "Underwriting", (i) the list of Underwriters and their respective
participation in the sale of the Securities, (ii) the sentences related to
concessions and reallowances and (iii) the paragraph related to stabilization,
syndicate covering transactions and penalty bids in any Preliminary Prospectus
and the Prospectus constitute the only information furnished in writing by or on
behalf of the several Underwriters for inclusion in any Preliminary Prospectus
or the Prospectus.

     (c)    Promptly after receipt by an indemnified party under this Section 9
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 9, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not relieve the
indemnifying party from liability under paragraph (a) or (b) above unless and to
the extent it did not otherwise learn of such action and such failure results in
the forfeiture by the indemnifying party of substantial rights and defenses and
(ii) will not, in any event, relieve the indemnifying party from any obligations
to any indemnified party other than the indemnification obligation provided in
paragraph (a) or (b) above. The indemnifying party shall be entitled to appoint
counsel of the indemnifying party's choice at the indemnifying party's expense
to represent the indemnified party in any action for which indemnification is
sought (in which case the indemnifying party shall not thereafter be responsible
for the fees and expenses of any separate counsel retained by the indemnified
party or parties except as set forth below) and to control such action;
provided, however, that such counsel shall be satisfactory to the indemnified
party. Notwithstanding the indemnifying party's election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (A) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a conflict of
interest, (B) the actual or potential defendants in, or targets of, any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (C) the

                                       23

<PAGE>

indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of the institution of such action or (D) the indemnifying party
shall authorize the indemnified party to employ separate counsel at the expense
of the indemnifying party.

     (d)    In the event that the indemnity provided in paragraph (a) or (b)
of this Section 9 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Fund, the Adviser and the Underwriters
severally agree to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in connection
with investigating or defending same) (collectively "Losses") to which the Fund,
the Adviser and one or more of the Underwriters may be subject in such
proportion as is appropriate to reflect the relative benefits received by the
Fund and the Adviser on the one hand (treated jointly for this purpose as one
person) and by the Underwriters on the other from the offering of the
Securities; provided, however, that in no case shall any Underwriter (except as
may be provided in any agreement among underwriters relating to the offering of
the Securities) be responsible for any amount in excess of the underwriting
discount or commission applicable to the Securities purchased by such
Underwriter hereunder. If the allocation provided by the immediately preceding
sentence is unavailable for any reason, the Fund, the Adviser and the
Underwriters severally shall contribute in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the Fund
and the Adviser on the one hand (treated jointly for this purpose as one person)
and of the Underwriters on the other in connection with the statements or
omissions which resulted in such Losses as well as any other relevant equitable
considerations. Benefits received by the Fund and the Adviser (treated jointly
for this purpose as one person) shall be deemed to be equal to the total net
proceeds from the offering (before deducting expenses) received by it, and
benefits received by the Underwriters shall be deemed to be equal to the total
underwriting discounts and commissions, in each case as set forth on the cover
page of the Prospectus. Relative fault shall be determined by reference to,
among other things, whether any untrue or any alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information provided by the Fund and the Adviser on the one hand
(treated jointly for this purpose as one person) or the Underwriters on the
other, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission. The Fund, the Adviser and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 9 were determined by
pro rata allocation or any other method of allocation which does not take
account of the equitable considerations referred to above. Notwithstanding the
provisions of this paragraph (d), no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 9, each person who controls an
Underwriter within the meaning of either the 1933 Act or the Exchange Act and
each director, officer, employee and agent of an Underwriter shall have the same
rights to contribution as such Underwriter, and each person who controls the
Fund or the Adviser within the meaning of either the 1933 Act or the Exchange
Act, each officer of the Fund and the Adviser who shall have signed the
Registration Statement and each director of the Fund and the Adviser shall have
the same rights to contribution as the Fund and the Adviser, subject in each
case to the applicable terms and conditions of this paragraph (d). The
Underwriters' obligations to contribute pursuant to this Section 9 are several
in proportion to

                                       24

<PAGE>

the respective number of Securities set forth opposite their names in Schedule I
(or such numbers of Securities increased as set forth in Section 10 hereof) and
not joint.

     (e)     No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
action, suit or proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability from claimants on claims that are the
subject matter of such action, suit or proceeding.

     (f)    Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 9 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 9 and the
representations and warranties of the Fund and the Adviser set forth in this
Agreement shall remain operative and in full force and effect, regardless of (i)
any investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter, the Fund, the Adviser or their shareholders,
trustees, directors, managers, members or officers or any person controlling the
Fund or the Adviser (control to be determined within the meaning of the 1933 Act
or the Exchange Act), (ii) acceptance of any Securities and payment therefor
hereunder and (iii) any termination of this Agreement. A successor to any
Underwriter or to the Fund, the Adviser or their shareholders, trustees,
directors, managers, members or officers or any person controlling any
Underwriter, the Fund or the Adviser shall be entitled to the benefits of the
indemnity, contribution and reimbursement agreements contained in this Section
9.

     10.    Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Securities agreed to be purchased by
such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the number of Securities set
forth opposite their names in Schedule I hereto bears to the aggregate number of
Securities set forth opposite the names of all the remaining Underwriters or in
such other proportion as you may specify in accordance with the Citigroup Global
Markets Inc. Master Agreement Among Underwriters) the Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase; provided,
however, that in the event that the aggregate number of Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase shall
exceed 10% of the aggregate number of Securities set forth in Schedule I hereto,
the remaining Underwriters shall have the right to purchase all, but shall not
be under any obligation to purchase any, of the Securities, and if such
nondefaulting Underwriters do not purchase all of the Securities, this Agreement
will terminate without liability to any nondefaulting Underwriter or the Fund.
In the event of a default by any Underwriter as set forth in this Section 10,
the Closing Date shall be postponed for such period, not exceeding five Business
Days, as the Representatives shall determine in order that the required changes
in the Registration Statement and the Prospectus or in any other documents or
arrangements may be effected. Nothing contained in this Agreement shall relieve
any defaulting Underwriter of its liability, if any, to the Fund and any
nondefaulting Underwriter for damages occasioned by its default hereunder. The
term "Underwriter" as used in this Agreement includes, for all purposes of this
Agreement, any party not listed in Schedule I

                                       25

<PAGE>

hereto who, with your approval and the approval of the Fund, purchases Firm
Securities which a defaulting Underwriter agreed, but failed or refused, to
purchase.

     11.    Termination. This Agreement shall be subject to termination in the
absolute discretion of the Representatives, without liability on the part of the
Underwriters to the Fund or the Adviser, by notice given to the Fund or the
Adviser prior to delivery of and payment for the Securities, if at any time
prior to such time (i) trading in the Fund's Common Stock or Cumulative
Preferred Stock shall have been suspended by the Commission or the NYSE or
trading in securities generally on the NYSE shall have been suspended or limited
or minimum prices shall have been established on either of the exchanges, (ii) a
banking moratorium shall have been declared either by Federal or New York State
authorities or (iii) there shall have occurred any outbreak or escalation of
hostilities, declaration by the United States of a national emergency or war, or
other calamity or crisis the effect of which on financial markets is such as to
make it, in the sole judgment of the Representatives, impractical or inadvisable
to proceed with the offering or delivery of the Securities as contemplated by
the Prospectus (exclusive of any supplement thereto).

     12.    Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Fund and the Adviser or its officers and of the Underwriters set forth in or
made pursuant to this Agreement will remain in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter or the Fund or the
Adviser or any of the officers, directors, employees, agents or controlling
persons referred to in Section 9 hereof, and will survive delivery of and
payment for the Securities. The provisions of Sections 8 and 9 hereof shall
survive the termination or cancellation of this Agreement.

     13.    Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telefaxed to the Citigroup Global Markets Inc. General Counsel (fax
no.: (212) 816-7912) and confirmed to the General Counsel, Citigroup Global
Markets Inc., at 388 Greenwich Street, New York, New York, 10013, Attention:
General Counsel; or, if sent to the Fund or the Adviser, will be mailed,
delivered or telefaxed to Royce Value Trust, Inc. (fax no.: (212) 832-8921) and
confirmed to it at Royce Value Trust, Inc., 1414 Avenue of the Americas, New
York, New York 10019, attention of the Legal Department.

     14.    Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers, trustees, directors, employees, agents and controlling persons
referred to in Section 9 hereof, and no other person will have any right or
obligation hereunder.

     15.    Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed within the State of New York.

     16.    Counterparts. This Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.

                                       26

<PAGE>

     17.    Headings. The section headings used herein are for convenience only
and shall not affect the construction hereof.

     18.    Definitions. The terms which follow, when used in this Agreement,
shall have the meanings indicated.

     "1933 Act" shall mean the Securities Act of 1933, as amended, and the rules
   and regulations of the Commission promulgated thereunder.

     "1933 Act Rules and Regulations" shall mean the rules and regulations of
   the Commission under the 1933 Act.

     "1940 Act" shall mean the Investment Company Act of 1940, as amended.

     "1940 Act Rules and Regulations" shall mean the rules and regulations of
   the Commission under the 1940 Act.

     "1940 Act Notification" shall mean a notification of registration of the
   Fund as an investment company under the 1940 Act on Form N-8A, as the 1940
   Act Notification may be amended from time to time.

     "7.80% Preferred" shall mean the Fund's issued and outstanding 7.80%
   Cumulative Preferred Stock, par value $.001 per share.

     "7.30% Preferred" shall mean the Fund's issued and outstanding 7.30% Tax-
   Advantaged Cumulative Preferred Stock, par value $.001 per share.

     "Acts" shall mean, collectively, the 1933 Act and the 1940 Act.

     "Advisers Act" shall mean the Investment Advisers Act of 1940, as amended.

     "Advisers Act Rules and Regulations" shall mean the rules and regulations
   of the Commission under the Advisers Act.

     "Basic Maintenance Report" shall mean that report that is delivered to the
   Rating Agency on or before the third Business Day after each Quarterly
   Valuation Date.

     "Business Day" shall mean any day other than a Saturday, a Sunday or a
   legal holiday or a day on which banking institutions or trust companies are
   authorized or obligated by law to close in New York City.

     "Code" means the Internal Revenue Code of 1986, as amended.

     "Commission" shall mean the Securities and Exchange Commission.

     "Effective Date" shall mean each date and time that the Registration
   Statement, any post-effective amendment or amendments thereto and any Rule
   462(b) Registration Statement became or become effective.

                                       27

<PAGE>


     "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.

     "Exchange Act Rules and Regulations" shall mean the rules and regulations
   of the Commission under the Exchange Act.

     "Execution Time" shall mean the date and time that this Agreement is
   executed and delivered by the parties hereto.

     "FCPA" means Foreign Corrupt Practices Act of 1977, as amended, and the
   rules and regulations thereunder.

     "NASD" means the National Association of Securities Dealers, Inc.

     "NYSE" means the New York Stock Exchange, Inc.

     "Preliminary Prospectus" shall mean any preliminary prospectus (including
   the statement of additional information incorporated by reference therein)
   referred to in Section 1(a) above and any preliminary prospectus (including
   the statement of additional information incorporated by reference therein)
   included in the Registration Statement at the Effective Date that omits Rule
   430A Information.

     "Prospectus" shall mean the prospectus (including the statement of
   additional information incorporated by reference therein) relating to the
   Securities that is first filed pursuant to Rule 497 after the Execution Time
   or, if no filing pursuant to Rule 497 is required, shall mean the form of
   final prospectus (including the statement of additional information
   incorporated by reference therein) relating to the Securities included in the
   Registration Statement at the Effective Date.

     "Quarterly Valuation Date" means the last Valuation Date of March, June,
   September and December, commencing _________ __, 2003.

     "Rating Agency" shall mean Moody's Investor Services, Inc.

     "Registration Statement" shall mean the registration statement referred to
   in Section 1(a) above, including exhibits and financial statements, as
   amended at the Execution Time (or, if not effective at the Execution Time, in
   the form in which it shall become effective) and, in the event any
   post-effective amendment thereto or any Rule 462(b) Registration Statement
   becomes effective prior to the Closing Date, shall also mean such
   registration statement as so amended or such Rule 462(b) Registration
   Statement, as the case may be. Such term shall include any Rule 430A
   Information deemed to be included therein at the Effective Date as provided
   by Rule 430A.

     "Rule 430A" and "Rule 462" refer to such rules under the 1933 Act.

     "Rule 430A Information" shall mean information with respect to the
   Securities and the offering thereof permitted to be omitted from the
   Registration Statement when it becomes effective pursuant to Rule 430A.

                                       28

<PAGE>

     "Rule 462(b) Registration Statement" shall mean a registration statement
   and any amendments thereto filed pursuant to Rule 462(b) relating to the
   offering covered by the registration statement referred to in Section 1(a)
   hereof.

     "Rule 497" refers to Rule 497(c) or 497(h) under the 1933 Act, as
   applicable.

     "Rules and Regulations" shall mean, collectively, the 1933 Act Rules and
   Regulations and the 1940 Act Rules and Regulations.

     "Valuation Date" means every Friday or, if such day is not a Business Day,
   the immediately preceding Business Day.

                                       29

<PAGE>


                  If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Fund, the Adviser and the several Underwriters.

                                  Very truly yours,

                                  ROYCE VALUE TRUST, INC.


                                  By:
                                     ---------------------------------------
                                     Name:
                                     Title:


                                  ROYCE & ASSOCIATES, LLC


                                  By:
                                     ---------------------------------------
                                     Name:
                                     Title:



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

Citigroup Global Markets Inc.
UBS Securities LLC

     By:  Citigroup Global Markets Inc.

         Name:
         Title:

For itself and the other
several Underwriters named in
Schedule I to the foregoing
Agreement.

                                       30

<PAGE>


                                   SCHEDULE I
                                   ----------
<TABLE>
<CAPTION>

                                                                           NUMBER OF UNDERWRITTEN
UNDERWRITERS                                                             SECURITIES TO BE PURCHASED
------------                                                             --------------------------
<S>                                                                      <C>

Citigroup Global Markets Inc.....................................

UBS Securities LLC ..............................................






                                                                                 ----------
                                                                                  8,800,000
                  Total..........................................                ==========
</TABLE>

</TEXT>
</DOCUMENT>
