News

The thoughts concerning recent market movements and future prospects for smaller-company stocks are solely those of Royce & Associates and, of course, there can be no assurance with regard to future market movements. Smaller-company stocks may involve considerably more risk than larger-cap stocks.

Important Performance and Expense Information

All performance information in this Review reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 180 days of purchase may be subject to a 1% redemption fee for all Funds, except for Royce European Smaller-Companies and Global Value Funds, which may be subject to a 2% redemption fee, payable to the Fund. Effective July1, 2008, shares redeemed within 365 days of purchase (reduced from three years) may be subject to a 2% redemption fee payable to the Fund for Royce Select I, Select II and Global Select Funds. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained here. All performance and expense information reflects results of the Fund’s oldest share Class (Investment Class or Service Class, as the case may be). Gross operating expenses reflect the Fund’s gross total annual operating expenses, including management fees, and any 12b-1 distribution and service fees. Net operating expenses reflect contractual fee waivers and/or reimbursements. All expense information is reported as of the Fund’s most current prospectus. Royce & Associates has contractually agreed to waive fees and/or reimburse operating expenses through December 31, 2008 to the extent necessary to limit total net annual operating expenses to no more than 1.49% for the Service Class of Royce Low-Priced Stock, 100 and Dividend Value Funds and 1.69% for Royce European Smaller-Companies and Global Value Funds. Royce & Associates has contractually agreed to waive fees and/or reimburse operating expenses through December 31, 2010 to the extent necessary to limit total net annual operating expenses to no more than 1.69% for the Service Class of Royce European Smaller-Companies and Global Value Funds. Royce & Associates has contractually agreed to waive fees and/or reimburse operating expenses through December 31, 2017 to the extent necessary to limit total net annual operating expenses to no more than 1.99% for the Service Class of Royce Dividend Value, European Smaller-Companies and Global Value Funds.

Shares of a Fund’s Service, Consultant, R and K Classes bear an annual distribution expense that is not borne by, or is higher than, the Fund’s oldest share Class. The Royce Funds invest primarily in securities of micro-, small and/or mid-cap companies, which may involve considerably more risk than investments in securities of larger-cap companies (see “Primary Risks for Fund Investors” in the respective Prospectus). Please read the Prospectus carefully before investing or sending money. The Russell 2000 is an unmanaged, capitalization-weighted index of domestic small-cap stocks that measures the performance of the 2,000 smallest publicly traded U.S. companies in the Russell 3000 index.