October 30, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: The Royce Fund
File Nos. 811-3599 & 2-80348
Gentlemen:
Enclosed for filing pursuant to Rule 14a-6 under the Securities Exchange Act
of 1934, as amended, are the definitive copies of the Notice of Meeting,
Proxy Statement and form of proxy in connection with the Special Meeting of
Shareholders of The REvest Growth & Income Fund, a series of The Royce Fund
(the "Fund"), to be held on November 10, 1997.
The foregoing materials are scheduled to be sent to Fund shareholders today.
Sincerely,
/s/ John E. Denneen
John E. Denneen
Secretary
JED:rw
Enclosures
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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ]Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
THE ROYCE FUND
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date filed:
<PAGE>
October 28, 1997
Dear Friends and Fellow Shareholders:
Enclosed you will find proxy material related to your approval of the new
Investment Advisory Agreement between The REvest Growth & Income Fund and
Royce, Ebright & Associates, Inc. The terms of the new Agreement are, in
substance, identical to the terms of the prior agreement which was deemed by
the Investment Company Act to terminate as of the date of my father's death
on July 14, 1997.
Please read the enclosed material carefully. I know that the time period
alloted for voting and returning the proxy card is very short; however your
vote is very important! Please help me with this critical vote by promptly
completing and returning the enclosed proxy card in the postage-paid
envelope, whether or not you plan to attend the meeting in person. Your
proxy is revocable and will not affect your right to vote in person if you
attend the meeting.
As always, if you have any questions, please feel free to call me at work at
(800) 277-5573 during regular business hours. Or, if it is more convenient,
call me at home at (207) 883-8593.
Sincerely,
/s/ Jennifer Ebright Goff
Jennifer Ebright Goff
President, Royce, Ebright & Associates, Inc.
<PAGE>
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
THE ROYCE FUND
To the Shareholders of
The REvest Growth & Income Fund:
NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders of The REvest
Growth & Income Fund (the "Fund"), a series of The Royce Fund (the "Trust"),
will be held at the offices of the Trust, 1414 Avenue of the Americas, New
York, New York, on November 10, 1997 at 2:00 p.m. (Eastern Time), for the
following purposes:
1. To approve a new Investment Advisory Agreement
between The Royce Fund, on behalf of The REvest Growth &
Income Fund, and Royce, Ebright & Associates, Inc.
2. If Proposal 1 is approved, to also approve an identical
Investment Advisory Agreement that will become effective when
voting shares of Royce, Ebright & Associates, Inc. are distributed
by the Estate of Thomas R. Ebright to Jennifer E. Goff and Ellen
S. Ebright.
3. To transact such other business as may come before the
meeting or any adjournment thereof.
The Board of Trustees has fixed the close of business on October 13, 1997 as
the record date for the determination of those shareholders entitled to vote
at the meeting, and only holders of record at the close of business on that
date will be entitled to vote.
The REvest Growth & Income Fund's Annual Report to
Shareholders for the year ended December 31, 1996 and its Semi-Annual
Report to Shareholders for the six months ended June 30, 1997 were
previously mailed to shareholders, and copies are available upon request,
without charge, by writing to RE&A at 50 Portland Pier, Portland, Maine
04101-4721 or calling toll-free at 1-800-277-5573.
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IMPORTANT
To save the expense of additional proxy solicitation, please insert your
instructions on the enclosed Proxy, date and sign it and return it in the
enclosed envelope (which requires no postage if mailed in the United
States), even if you expect to be present at the meeting. The Proxy is
solicited on behalf of the Board of Trustees, is revocable and will not
affect your right to vote in person in the event that you attend the
meeting.
By order of the Board of Trustees.
John E. Denneen,
Secretary
October 28, 1997
<PAGE>
PROXY STATEMENT FOR SPECIAL MEETING OF
SHAREHOLDERS OF THE ROYCE FUND
The enclosed Proxy is solicited on behalf of the Trustees of The
Royce Fund for use at the Special Meeting of Shareholders of The REvest
Growth & Income Fund, a series of the Trust, to be held at the offices of
the Trust, 1414 Avenue of the Americas, New York, New York 10019
(10th Floor), at 2:00 p.m., Eastern Time, on November 10 , 1997 and at
any adjournments thereof.
The purpose of the meeting is the approval of two new Investment
Advisory Agreements between The Royce Fund, on behalf of The REvest
Growth & Income Fund, and Royce, Ebright & Associates, Inc.
("RE&A").
The Proxy may be revoked at any time before it is exercised by
written instructions to the Trust or by filing a new Proxy with a later date,
and any shareholder attending the meeting may vote in person, whether or
not he or she has previously filed a Proxy.
Shares represented by all properly executed Proxies received in time for the
meeting will be voted. Where a shareholder has specified a choice on the
Proxy with respect to Proposals 1 and 2 in the Notice of Special Meeting,
his or her shares will be voted accordingly. If no directions are given,
the shareholder's shares will be voted in favor of these Proposals. The
cost of soliciting Proxies will be borne by RE&A, which will reimburse
brokerage firms, custodians, nominees and fiduciaries for their expenses in
forwarding proxy material to the beneficial owners of the Fund's shares.
Some officers and employees of the Trust, Royce Fund Services, Inc.
("RFS"), the Fund's distributor, and/or RE&A, the Fund's investment adviser,
may solicit proxies personally and by telephone, if deemed desirable.
Shareholders vote at the Special Meeting by casting ballots (in person or by
proxy) which are tabulated by one or two persons, appointed by the Board of
Trustees before the meeting, who serve as Inspectors and Judges of Voting at
the meeting and who have executed an Inspectors and Judges Oath. Neither
abstentions nor broker non-votes are counted in the tabulation of such
votes.
<PAGE>
On October 13, 1997, the record date for the meeting, there were 2,712,624
shares of the Fund outstanding. The shareholders entitled to vote are those
of record on that date. Each share is entitled to one vote on each item of
business at the meeting.
The following persons were known to the Trust to be beneficial
owners or owners of record of 5% or more of the Fund's outstanding
shares of beneficial interest as of the record date.
Name and Address Amount and Nature Percentage
of Owner of Ownership of Class
Charles Schwab & Co., Inc. 557,908 shares -- 20.6%
Attn. Mutual Fund Dept. Record
101 Montgomery Street
San Francisco, CA 94104-4122
Bankers Trust Co. TTEE 410,983 shares -- 15.2%
FBO Carlisle Companies, Inc. Record
Master Retirement Trust
Attn: Steve Staranka
34 Exchange Place
Jersey City, NJ 07302-3901
As of such date, all of the trustees and officers of the Trust as a group
owned 65,130 shares of the Fund (2.4% of the outstanding shares).
Approval of the
New Investment Advisory Agreement
for the Fund
(Proposal 1)
The Board of Trustees of the Trust has approved, and
recommended to the Fund's shareholders for their approval, a new
Investment Advisory
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Agreement between The Royce Fund, on behalf
of The REvest Growth & Income Fund, and RE&A.
Reason for the Proposed New Investment Advisory Agreement
On July 14, 1997, Thomas R. Ebright, President and controlling
shareholder of RE&A, passed away. Shortly thereafter, Jennifer E. Goff,
his daughter, was elected President of RE&A. Prior to his death, Mr.
Ebright had owned 60%, Ms. Goff owned 20% and Ellen S. Ebright, Mr.
Ebright's other daughter and Jennifer E. Goff's sister, owned 20% of
RE&A's outstanding voting shares. Upon Mr. Ebright's death, a
controlling interest in RE&A was transferred by operation of law to the
Executors of his Estate. This transfer was an "assignment", for purposes
of the Investment Company Act of 1940 (the "1940 Act"), of the
Investment Advisory Agreement made August 1, 1994 (the "Original
Agreement") by and between the Trust, with respect to the Fund, and
RE&A, and therefore caused the Original Agreement to automatically
terminate. The present Investment Advisory Agreement made July 22,
1997 (the "Present Agreement") by and between the Trust, with respect to
the Fund, and RE&A was approved by the Trust's Board of Trustees, but
not by the Fund's shareholders, pursuant to Rule 15a-4 under the 1940
Act. Under that Rule, the Present Agreement will terminate on November
11, 1997, if it or a new investment advisory agreement is not approved by
shareholders.
Present Investment Advisory Agreement
The substantive provisions of the Original Agreement and those of
the Present Agreement have been in effect since August 1, 1994, when the
Fund commenced operation, and are identical to one another, except for
a provision, effective January 1, 1997, which lowered the fee payable to
RE&A for assets of the Fund in excess of $50,000,000 from 1.00% to
0.75% per annum.
Under the Original and Present Agreements, RE&A determines the
composition of the Fund's portfolio, the nature and timing of the changes
in it and the manner of implementing the changes; provides the Fund with
investment advisory,
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research and related services for the investment of its
funds; furnishes, without expense to the Fund, the services of those of its
officers and full time employees as may be duly elected executive officers
or trustees of the Trust; pays its pro rata share of all of the salaries and
expenses of the Trust's executive officers; pays all expenses incurred in
performing its investment advisory duties under the Agreements; and is
required to reimburse the Trust for any space leased by the Trust and
occupied by RE&A. The Fund pays all of its own expenses (except those
set forth above).
Present Advisory Fee
As compensation for its services under the Agreements, RE&A
receives advisory fees equal to 1.00% per annum of the first $50,000,000
of the Fund's average net assets and 0.75% per annum of additional
average net assets over $50,000,000. For purposes of calculating these
fees, average net assets means average net assets of the Fund at the close
of business on each day that the value of its net assets is computed during
the year. For the fiscal year ended December 31, 1996, the Fund paid
RE&A advisory fees amounting to $375,493.
Proposed New Agreement
The proposed new Investment Advisory Agreement (the "New
Agreement") continues the present advisory fee and the other
substantive provisions of the Original and Present Agreements.
On July 22, 1997, the Trust's Board of Trustees held a special
meeting to consider whether to continue RE&A as the Fund's investment
adviser. It heard from Jennifer E. Goff, who had been serving as the
Fund's assistant portfolio manager and had been involved in all investment
decisions February 1997. (Ms. Goff has also been Vice President and a
Member of RE&A's Board since the Fund's inception and Director of
Research of RE&A since June 1996.) Ms. Goff addressed, among other
subjects, her qualifications and business experience and plans for the Fund.
After considering (i) Ms. Goff's qualifications, business experience, role in
RE&A and approach to managing the Fund's portfolio (among other
factors); (ii) the investment
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performance of the Fund under RE&A's
management; (iii) RE&A's approach to managing the Fund's assets; and
(iv) the costs and expenses of the Fund, the Trustees voted unanimously to
approve the Present Agreement.
At its September 25, 1997 regular meeting, the Board, after
again considering these factors, voted to recommend approval of the
New Agreement to shareholders. A copy of the New Agreement is
attached hereto as Exhibit A.
In approving the Present and New Agreements, the Trustees asked
Charles M. Royce, as a Trustee and President of the Trust, to monitor
REvest's portfolio activities for the Fund and to report to the Board as
needed. Mr. Royce, who is also a non-voting shareholder of RE&A,
performs this function without cost to REvest or RE&A.
Recommendation of the Trustees; Required Votes
The Trustees recommend that the Fund's shareholders vote to
approve the new Investment Advisory Agreement between the Trust,
on behalf of The REvest Growth & Income Fund, and RE&A. Such
approval will require the favorable vote of the lesser of (i) more than 50%
of the Fund's outstanding shares and (ii) 67% or more of the Fund's shares
present or represented at the meeting, if the holders of more than 50% of
the Fund's shares are present or represented at the meeting.
-----------------------------------------
Approval of Second New Investment
Advisory Agreement
for the Fund
(Proposal 2)
The New Agreement will automatically terminate when the
Executors of Mr. Ebright's Estate distribute his voting shares of RE&A to
his beneficiaries because the
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distribution will constitute a second
"assignment" for purposes of the 1940 Act. The Executors have informed
the Trust that they expect to distribute one-half of these shares to each of
Mr. Ebright's daughters, so that each of Jennifer E. Goff and Ellen S.
Ebright will own 50% of RE&A's outstanding voting shares and be a
controlling person of RE&A. Ellen S. Ebright has not been involved in
RE&A's business and has no present intention of doing so. Based on the
foregoing, the Board has also approved a new second investment advisory
agreement for the Fund that contains the identical substantive terms as the
New Agreement, to be entered into immediately following the distribution
of Mr. Ebright's voting shares of RE&A to his daughters. If the Fund's
shareholders approve Proposal 1, they will be be asked at the meeting to
approve this second new investment advisory agreement, provided that Mr.
Ebright's voting shares of RE&A are distributed as described above.
Recommendation of the Trustees; Required Votes
The Trustees recommend that the Fund's shareholders vote to
approve this second new Investment Advisory Agreement between the
Trust, on behalf of The REvest Growth & Income Fund, and RE&A,
to be entered into and to take effect immediately following the
distribution by Mr. Ebright's Estate of the voting shares of RE&A as
described above. Such approval will also require the favorable vote of the
lesser of (i) more than 50% of the Fund's outstanding shares and (ii) 67%
or more of the Fund's shares present or represented at the meeting, if the
holders of more than 50% of the Fund's shares are present or represented
at the meeting.
-----------------------------------------
RE&A's Long-Term Plans
RE&A is continuing its search for long-term strategic alternatives,
which may include either hiring a co-portfolio manager or developing a
more formal association with Royce & Associates, Inc., the investment
adviser of the other series of the Trust, or another suitable firm. The
composition of the Fund's shareholder base, the
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<PAGE>
principles that guide
RE&A's investment decisions and the management philosophy it employs
with respect to the Fund are all important factors to be considered in this
process. Before any such arrangement is finalized, it will be submitted to
the Board of Trustees for its approval and, if required, to the Fund's
shareholders for their approval.
-----------------------------------------
Certain Information as to the Directors, Officers and
Shareholders of RE&A
Jennifer E. Goff is also President and a member of the Board of
Directors of RE&A. Ms. Goff's address is 50 Portland Pier, Portland, ME
04101-4721. Ellen S. Ebright is also a member of RE&A's Board of
Directors. She is an analyst with an accounting firm, and her address is
1025 16th Avenue South, Suite 202, Nashville, TN 37212. The Executors
of Mr. Ebright's Estate are Joyce M. Ebright, his widow, and Earl L.
Mummert. Their addresses are 102 Chandler's Wharf, Portland, ME
04101 and 500 Nationwide Drive, Harrisburg, PA 17110-5900,
respectively. Joyce M. Ebright, manager of Ebright Properties Limited and
Chairman of the Portland Pirates Hockey Team, is also a member of
RE&A's Board of Directors,.
Charles M. Royce is President, Treasurer and a Trustee of the
Trust and a non-voting shareholder of RE&A. W. Whitney George, a Vice
President of the Trust, is deemed to be a non-voting shareholder of RE&A
in his capacity as trustee of a trust for the benefit of members of Mr.
Royce's family.
Adjournment of Meeting; Other Matters
In the event that sufficient votes in favor of Proposals 1 and 2 in
the Notice of Special Meeting are not received by the time scheduled for
the meeting, the persons named as proxies may propose one or more
adjournments of the meeting to permit further solicitation of proxies for
such Proposals. Any such adjournment will require
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the affirmative vote of
a majority of the shares present in person or by proxy at the session of the
meeting to be adjourned. The persons named as proxies will vote in favor
of such adjournment those proxies which they are entitled to vote in favor
of Proposals 1 and 2. They will vote against any such adjournment those
proxies required to be voted against Proposals 1 and 2.
While the meeting has been called to transact any business that may
properly come before it, the only matters which the Trustees intend to
present are the matters stated in the Notice of Special Meeting. However,
if any additional matter properly comes before the meeting and on all
matters incidental to the conduct of the meeting, it is the intention of the
persons named in the enclosed Proxy to vote the Proxy in accordance with
their judgment on such matters unless instructed to the contrary.
Shareholder Proposals
The Trust does not hold annual shareholder meetings.
Shareholders wishing to submit proposals for inclusion in a proxy
statement for a subsequent shareholder meeting should send their written
proposals to the Secretary of the Trust, 1414 Avenue of the Americas,
New York, New York 10019.
PLEASE FILL IN, DATE AND SIGN THE PROXY AND
RETURN IT IN THE ACCOMPANYING POSTAGE-PAID
ENVELOPE.
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EXHIBIT A
INVESTMENT ADVISORY AGREEMENT
BETWEEN
THE ROYCE FUND (The REvest Growth & Income Fund)
AND
ROYCE, EBRIGHT & ASSOCIATES, INC.
Agreement made this ____ day of November, 1997, by and
between THE ROYCE FUND, a Delaware business trust (the "Fund"), and
ROYCE, EBRIGHT & ASSOCIATES, INC., a Connecticut corporation
(the "Adviser"), in respect of The REvest Growth & Income Fund, a series
of the Fund (the "Series").
The Fund and the Adviser hereby agree as follows in respect of the
Series:
1. Duties of the Adviser. The Adviser shall, during the term and
subject to the provisions of this Agreement, (a) determine the composition
of the portfolio of the Series, the nature and timing of the changes therein
and the manner of implementing such changes, and (b) provide the Series
with such investment advisory, research and related services as the Series
may, from time to time, reasonably require for the investment of its funds.
The Adviser shall perform such duties in accordance with the applicable
provisions of the Fund's Declaration of Trust, By-Laws and current
prospectus and any directions it may receive from the Fund's Trustees.
2. Expenses Payable by the Series. Except as otherwise provided in
Paragraphs 1 and 3 hereof, the Fund shall be responsible for effecting sales
and redemptions of the Series' shares, for determining the net asset value
thereof and for all of the Series' other operations and shall cause the
Series to pay all administrative and other costs and expenses attributable
to its operations and transactions, including, without limitation, transfer
agent and custodian fees; legal, administrative and clerical services; rent
for office space and facilities; auditing; preparation, printing and
distribution of its prospectuses, proxy statements, shareholders' reports
and notices;
<PAGE>
supplies and postage; Federal and state registration fees;
Federal, state and local taxes; non-affiliated Trustees' fees; and brokerage
commissions.
3. Expenses Payable by the Adviser. The Adviser shall furnish, without
expense to the Fund or to the Series, the services of those of its officers
and full-time employees who may be duly elected executive officers or
Trustees of the Fund, subject to their individual consent to serve and to
any limitations imposed by law, and shall pay its pro rata share of all of
the salaries and expenses of the Fund's executive officers. For purposes of
this Agreement, only the President, any Vice President and the Treasurer of
the Fund shall be deemed to be executive officers of the Fund. The Adviser
shall also pay all expenses which it may incur in performing its duties under
Paragraph 1 hereof and shall reimburse the Fund for any space leased by the
Fund and occupied by the Adviser. In the event the Fund shall qualify shares
of the Series for sale in any jurisdiction, the applicable statutes or
regulations of which expressly limit the amount of the Series' total annual
expenses, the Adviser agrees to reduce its annual investment advisory fee
for the Series to the extent that such total annual expenses (other than
brokerage commissions and other capital items, interest, taxes, distribution
fees, extraordinary items and other excludable items, charges, costs and
expenses) exceed the limitations imposed on the Series by the most stringent
regulations of any such jurisdiction.
4. Compensation of the Adviser. The Fund agrees to cause the Series to
pay to the Adviser, and the Adviser agrees to accept, as compensation for
the services provided by the Adviser hereunder, advisory fees equal to 1%
per annum of the first $50,000,000 of the Series' average net assets and
0.75% per annum of additional average net assets over $50,000,000. For
purposes of calculating these fees, average net assets will mean the average
net assets of the Series at the close of business on each day that the value
of its net assets is computed during the year. However, the Fund and the
Adviser may agree in writing to temporarily or permanently reduce such fee.
Such compensation shall be accrued on the Series' books at the close of
business on each day that the value of its net assets is computed during
each year and shall be payable to the Adviser monthly, on the last day of
each month, and adjusted as of year-end if required.
<PAGE>
5. Excess Brokerage Commissions. The Adviser is hereby authorized, to the
fullest extent now or hereafter permitted by law, to cause the Series to pay
a member of a national securities exchange, broker or dealer an amount of
commission for effecting a securities transaction in excess of the amount of
commission another member of such exchange, broker or dealer would have
charged for effecting that transaction, if the Adviser determines in good
faith that such amount of commission is reasonable in relation to the value
of the brokerage and/or research services provided by such member, broker or
dealer, viewed in terms of either that particular transaction or its overall
responsibilities with respect to the Series.
6. Limitations on the Employment of the Adviser. The services of the
Adviser to the Series shall be deemed exclusive, and the Adviser may not
engage in any other business or render services to others, whether or not
its services to the Series hereunder would be impaired thereby. However,
nothing in this Agreement shall limit or restrict the right of any director,
officer or employee of the Adviser to engage in any other business or to
devote his time and attention in part to any other business, whether of a
similar or dissimilar nature. So long as this Agreement or any extension,
renewal or amendment remains in effect, the Adviser shall be the only
investment adviser for the Series, subject to the Adviser's right to enter
into sub-advisory agreements. The Adviser assumes no responsibility under
this Agreement other than to render the services called for hereunder, and
shall not be responsible for any action of or directed by the Fund's
Trustees, or any committee thereof, unless such action has been caused by
the Adviser's gross negligence, willful malfeasance, bad faith or reckless
disregard of its obligations and duties under this Agreement.
7. Responsibility of Dual Directors, Officers and/or Employees. If any
person who is a director, officer or employee of the Adviser is or becomes a
Trustee, officer and/or employee of the Fund and acts as such in any
business of the Fund pursuant to this Agreement, then such director, officer
and/or employee of the Adviser shall be deemed to be acting in such capacity
solely for the Fund, and not as a director, officer or employee of the
Adviser or under the control or direction of the Adviser, although paid by
the Adviser.
8. Protection of the Adviser. The Adviser shall not be liable to the Fund
or to the Series for any action taken or omitted to be taken by the Adviser
in connection
<PAGE>
with the performance of any of its duties or
obligations under this Agreement or otherwise as an investment adviser for
the Series, and the Series shall indemnify the Adviser and hold it harmless
from and against all damages, liabilities, costs and expenses (including
reasonable attorneys' fees and amounts reasonably paid in settlement)
incurred by the Adviser in or by reason of any pending, threatened or
completed action, suit, investigation or other proceeding (including an
action or suit by or in the right of the Fund or the Series or its security
holders) arising out of or otherwise based upon any action actually or
allegedly taken or omitted to be taken by the Adviser in connection with the
performance of any of its duties or obligations under this Agreement or
otherwise as an investment adviser for the Series. Notwithstanding the
preceding sentence of this Paragraph 8 to the contrary, nothing contained
herein shall protect or be deemed to protect the Adviser against or entitle
or be deemed to entitle the Adviser to indemnification in respect of, any
liability to the Fund or to the Series or its security holders to which the
Adviser would otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence in the performance of its duties or by reason of
its reckless disregard of its duties and obligations under this Agreement.
Determinations of whether and the extent to which the Adviser is entitled to
indemnification hereunder shall be made by reasonable and fair means,
including (a) a final decision on the merits by a court or other body before
whom the action, suit or other proceeding was brought that the Adviser was
not liable by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of its duties, or (b) in the absence of such a decision,
a reasonable determination, based upon a review of the facts, that the
Adviser was not liable by reason of such misconduct by (i) the vote of a
majority of a quorum of the Trustees of the Fund who are neither "interested
persons" of the Fund (as defined in Section 2(a) (19) of the Investment
Company Act of 1940) nor parties to the action, suit or other proceeding, or
(ii) an independent legal counsel in a written opinion.
9. Effectiveness, Duration and Termination of Agreement. This
Agreement shall become effective immediately upon approval by a majority of
the outstanding voting securities of the Series, and the Investment Advisory
Agreement made September 24, 1992 by and between the Fund and Quest Advisory
Corp. (now named Royce & Associates, Inc.) shall not apply as to the
Series. This Agreement shall remain in effect until April 30, 1999, and
thereafter shall continue automatically
<PAGE>
for successive annual periods,
provided that such continuance is specifically approved at least annually by
(a) the vote of the Fund's Trustees, including a majority of such Trustees
who are not parties to this Agreement or "interested periods" (as such term
is defined in Section 2(a)(19) of the Investment Company Act of 1940) of any
such party, cast in person at a meeting called for the purpose of voting on
such approval, or (b) the vote of a majority of the outstanding voting
securities of the Series and the vote of the Fund's Trustees, including a
majority of such Trustees who are not parties to this Agreement or
"interested persons" (as so defined) of any such party. This Agreement may
be terminated at any time, without the payment of any penalty, on 60 days'
written notice by the vote of a majority of the outstanding voting
securities of the Series, or by the vote of a majority of the Fund's
Trustees or by the Adviser, and will automatically terminate in the event of
its "assignment" (as such term is defined for purposes of Section 15(a)(4)
of the Investment Company Act of 1940); provided, however, that the
provisions of Paragraph 8 of this Agreement shall remain in full force and
effect, and the Adviser shall remain entitled to the benefits thereof,
notwithstanding any such termination.
Any notice under this Agreement shall be given in writing,
addressed and delivered or mailed, postage prepaid, to the other party at
its principal office.
10. Shareholder Liability. Notice is hereby given that this Agreement is
entered into on the Fund's behalf by an officer of the Fund in his capacity
as an officer and not individually and that the obligations of or arising
out of this Agreement are not binding upon any of the Fund's Trustees,
officers, employees, agents or shareholders individually, but are binding
only upon the assets and property of the Series.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed the day and year first above written.
THE ROYCE FUND
By:__________________________
Charles M. Royce, President
ROYCE, EBRIGHT & ASSOCIATES, INC.
By:__________________________
Jennifer E. Goff, President
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PROXY
PROXY THE REVEST GROWTH & INCOME FUND PROXY
1414 Avenue of the Americas
New York, NY 10019
This Proxy is Solicited on Behalf of the Board of Trustees
The undersigned hereby appoints Charles M. Royce and John E. Denneen, or
either of them, acting in absence of the other, as Proxies, each with the
power to appoint his substitute, and hereby authorizes them to represent and
to vote, as designated on the reverse, all shares of the Fund held of record
by the undersigned on October 13, 1997, at the Special Meeting of
Shareholders to be held on November 10, 1997, or at any adjournment thereof.
This Proxy, when properly executed, will be voted in the manner directed by
the undersigned shareholder. If no direction is made, this Proxy will be
voted FOR Proposals 1 and 2.
PLEASE VOTE , DATE AND SIGN ON REVERSE AND RETURN
PROMPTLY
IN THE ENCLOSED ENVELOPE.
Please sign exactly as your name(s) appear(s) on reverse. When shares are
held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as
such. If a corporation, please sign in full corporate name by president or
other authorized officer. If a partnership, please sign in partnership name
by authorized person.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
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X PLEASE MARK VOTES
AS IN THIS EXAMPLE
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THE REVEST GROWTH & INCOME FUND
_________________________________________ For Against Abstain
1. PROPOSAL TO APPROVE A NEW INVESTMENT
ADVISORY AGREEMENT BETWEEN THE
ROYCE FUND, ON BEHALF OF THE REVEST
GROWTH & INCOME FUND, AND ROYCE,
EBRIGHT & ASSOCIATES, INC.
2. PROPOSAL TO APPROVE A SECOND INVEST-
MENT ADVISORY AGREEMENT THAT WILL
BECOME EFFECTIVE WHEN VOTING SHARES
OF ROYCE, EBRIGHT & ASSOCIATES, INC.
ARE DISTRIBUTED BY THE ESTATE OF
THOMAS R. EBRIGHT TO JENNIFER E. GOFF
AND ELLEN S. EBRIGHT.
3. THE PROXIES ARE AUTHORIZED TO VOTE
UPON SUCH OTHER MATTERS AS MAY
PROPERLY COME BEFORE THE MEETING.
Please be sure to sign and date this Proxy. Date:
Mark box at right if an address change or comment has been
noted on the reverse side of this card.
Shareholder sign here Co-owner sign here RECORD DATE SHARES:
