<R> As filed with the Securities and Exchange Commission on February 3, 2003 </R>

Securities Act File No. 2-60836
Investment Company Act File No. 811-2809
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
      REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 |X|
  Pre-Effective Amendment No. |   |
  <R> Post-Effective Amendment No. 32 </R>
and/or
|X|
  REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940 		|X|
  <R>Amendment No. 31</R>
(Check appropriate box or boxes) 		|X|
Merrill Lynch Small Cap Value Fund, Inc.
(Exact Name of Registrant as Specified in Charter)

800 Scudders Mill Road, Plainsboro, New Jersey 08536
(Address of Principal Executive Offices)

Registrant’s telephone number, including Area Code (609) 282-2800
Terry K. Glenn
Merrill Lynch Small Cap Value Fund, Inc.
800 Scudders Mill Road
Plainsboro, New Jersey
Mailing Address: P.O. Box 9011, Princeton, New Jersey 08543-9011
(Name and Address of Agent for Service)

Copies to:
Counsel for the Fund:
Thomas R. Smith, Jr., Esq.
SIDLEY AUSTIN BROWN & WOOD LLP
787 Seventh Avenue
New York, New York 10019-6018 		Philip L. Kirstein, Esq.
FUND ASSET MANAGEMENT, L.P.
P.O. Box 9011
Princeton, New Jersey 08543-9011
It is proposed that this filing will become effective (check appropriate box)
<R> |X|    immediately upon filing pursuant to paragraph (b)
       |     |   on (date) pursuant to paragraph (b)</R>
  |     |   60 days after filing pursuant to paragraph (a)(1)
  |     |   on (date) pursuant to paragraph (a)(1)
  |     |   75 days after filing pursuant to paragraph (a)(2)
  |     |   on (date) pursuant to paragraph (a)(2) of Rule 485

If appropriate, check the following box:
       |     |    This post-effective amendment designates a new effective date for a previously filed post-effective amendment.

  Title of Securities Being Registered: Common Stock, par value $.10 per share.

Master Small Cap Value Trust has also executed this Registration Statement

 

 

     <R>This Post-Effective Amendment No. 32 to the Registrant’s Registration Statement on Form N-1A (File No. 2-60836) (the “Registration Statement”) consists of the following: (1) the facing sheet of the Registration Statement, (2) Amendment, dated February 4, 2003, to the Registrant’s current Prospectus and Statement of Additional Information, and (3) Part C to the Registration Statement (including signature page). Parts A and B to the Registration Statement, were previously filed on July 25, 2002 in connection with Post-Effective Amendment No. 31 to the Registration Statement.

     This Post-Effective Amendment No. 32 to the Registration Statement is being filed to: (1) describe the features of the Registrant’s Class R shares, (2) provide certain additional information with respect to the Registrant’s Class C shares, (3) provide updated financial information for the Registrant, (4) file certain exhibits to the Registration Statement, and (5) incorporate certain exhibits by reference into the Registration Statement. </R>

 
  MERRILL LYNCH SMALL CAP VALUE FUND, INC.  

 

 

<R>
Merrill Lynch Small Cap Value Fund, Inc.

AMENDMENT DATED FEBRUARY 4, 2003
TO PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION,
EACH DATED JULY 25, 2002

Effective February 4, 2003, Merrill Lynch Small Cap Value Fund, Inc. began offering Class R shares to certain qualified investors. This amendment to the Fund’s Prospectus and Statement of Additional Information, which should be read in conjunction with such documents, describes the features of the Fund’s Class R shares, revises the definition of small cap companies, provides certain additional information with respect to the Fund’s Class C shares, and provides updated financial information for the Fund.

SMALL CAP COMPANIES

The definition of small cap companies found on page three of the prospectus is deleted and replaced with the following:

Small Cap market capitalization companies are those whose market capitalization is similar to the market capitalization of companies in the Russell 2000 ® or the S&P SmallCap 600 ® at the time of the Fund’s investment. Companies whose capitalization no longer meets this definition after purchase continue to be considered small market capitalization companies for purposes of the 80% policy. As of December 31, 2002, the Russell 2000 ® included companies with capitalizations up to $2.45 billion and the S&P SmallCap 600 ® included companies with capitalizations up to $2.67 billion. The market capitalizations of companies in each index change with market conditions and the composition of the index.

PERFORMANCE INFORMATION

The Fund’s return as of December 31, 2002 for the Fund’s Class B shares was -23.90%. The Fund’s Class B shares are not subject to an initial sales charge but are subject to a contingent deferred sales charge. The Fund’s Class B shares are also subject to a distribution fee of 0.75% and an account maintenance fee of 0.25%. The Fund’s Class R shares are not subject to an initial sales charge or a contingent deferred sales charge but are subject to a distribution fee of 0.25% and an account maintenance fee of 0.25%. See “Merrill Lynch Select Pricing SM System” in this Amendment for more information about the Fund’s Class R shares.

The contingent deferred sales charge for the Fund’s Class B shares is not reflected in the Fund’s return. If this amount were reflected, the return for the Fund would be less than that shown above. How the Fund performed in the past is not necessarily an indication of how the Fund will perform in the future.</R>

 
  MERRILL LYNCH SMALL CAP VALUE FUND, INC.  

 

 

<R>UNDERSTANDING
EXPENSES

Fund investors pay various fees and expenses, either directly or indirectly. Listed below are some of the main types of expenses that the Fund may charge:

Expenses paid directly by the shareholder:

Shareholder Fees — these include sales charges that you may pay when you buy or sell shares of the Fund.

Expenses paid indirectly by the shareholder:

Annual Fund Operating Expenses — expenses that cover the costs of operating the Fund.

Management Fee — a fee paid to the Investment Adviser for managing the Fund.

Administration Fee — a fee paid to the Administrator for providing administrative services to the Fund.

Distribution Fees — fees used to support the Fund’s marketing and distribution efforts, such as compensating Financial Advisors and other financial intermediaries, advertising and promotion.

Service (Account Maintenance) Fees — fees used to compensate securities dealers and other financial intermediaries for account maintenance activities

FEES AND EXPENSES

The Fund offers five different classes of shares. This table describes the fees and expenses that you may pay if you buy and hold Class R shares of the Fund. Future expenses may be greater or less than those indicated below.

Shareholder Fees (fees paid directly from your investment) (a):

Class R

  Maximum Sales Charge (Load) imposed on purchases (as a
  percentage of offering price)

None

  Maximum Deferred Sales Charge (Load) (as a percentage of
  original purchase price or redemption proceeds, whichever is lower)

None

  Maximum Sales Charge (Load) imposed on Dividend Reinvestments

None

  Redemption Fee

None

  Exchange Fee

None

 Annual Fund Operating Expenses (expenses that are deducted
 from Fund assets ) (b)

 

    Management Fee (c)

0.47%

    Distribution and/or Service (12b-1) Fees (d)

0.50%

   Other Expenses (including transfer agency fees and Administration Fee)(e)(f)

0.55%

   Total Annual Fund Operating Expenses

1.52%

(a) In addition, Merrill Lynch may charge clients a processing fee (currently $5.35) when a client buys or sells Class R shares. See “Your Account — How to Buy, Sell, Transfer and Exchange Shares” in the Fund’s Prospectus.
(b) The fees and expenses shown in the table above include both the expenses of the Fund and the Fund’s share of expenses of Master Small Cap Value Trust (the “Trust”).
(c) Paid by the Trust. The Trust pays the Investment Adviser a fee at the annual rate of 0.50% of the average daily net assets of the Trust for the first $1 billion; 0.475% of the average daily net assets from $1 billion to $1.5 billion; and 0.45% of the average daily net assets above $1.5 billion. For the six-month period ended September 30, 2002, the fee payable to the Investment Adviser from the Trust was equal to 0.47% of the Trust’s average daily net assets.
(d) The Fund calls the “Service Fee” an “Account Maintenance Fee.” Account Maintenance Fee is the term used in the Fund’s Prospectus and in all other Fund materials. If you hold Class R shares over time, it may cost you more in distribution (12b-1) fees than the maximum sales charge that you would have paid if you were a shareholder of one of the other share classes.
(e) Based on estimated amounts for the Fund’s most recent fiscal period. Financial Data Services, Inc., an affiliate of the Investment Adviser, provides transfer agency services to the Fund. The Fund pays a fee for these services. The Investment Adviser or its affiliates also provide certain accounting services to the Fund and the Trust. The Fund and the Trust reimburse the Investment Adviser or its affiliates for such services.
(f) Includes administration fees, which are payable to the Investment Adviser by the Fund at the annual rate of 0.25% of the Fund’s average daily net assets. </R>

 
2  MERRILL LYNCH SMALL CAP VALUE FUND, INC.  

 

 

<R> Examples:

These examples are intended to help you compare the cost of investing in Class R shares of the Fund with the cost of investing in other mutual funds.

These examples assume that you invest $10,000 in the Fund for the time periods indicated, that your investment has a 5% return each year, that you pay the sales charges, if any, that apply to the particular class and that the Fund’s operating expenses remain the same. This assumption is not meant to indicate you will receive a 5% annual rate of return. Your annual return may be more or less than the 5% used in this example. Although your actual costs may be higher or lower, based on these assumptions your costs would be:

EXPENSES IF YOU DID REDEEM YOUR SHARES*:

 
 

1 Year

3 Years

5 Years

10 Years

Class R

$155

$480

$829

$1,813

 

EXPENSES IF YOU DID NOT REDEEM YOUR SHARES*:

 
 

1 Year

3 Years

5 Years

10 Years

Class R

$155

$480

$829

$1,813

 
* Include the expenses of both the Fund and the Fund’s share of expenses of the Trust. </R>

 
  MERRILL LYNCH SMALL CAP VALUE FUND, INC. 3 

 

 


<R>MERRILL LYNCH SELECT PRICING SM SYSTEM

With the addition of the Class R shares, the Fund offers five classes of shares. Investors in the Fund may choose from among Class A shares, Class B shares, Class C shares, Class D shares and Class R shares, subject to eligibility requirements.

Class R shares are available only to certain retirement plans. Your financial adviser can help you determine whether you are eligible to buy Class R shares.

Class R shares are not subject to an initial sales charge or a contingent deferred sales charge. However, Class R shares are subject to a distribution fee of 0.25% and an account maintenance fee of 0.25%.

To better understand the pricing of the Fund’s Class R shares, we have summarized the information below.

   

Class R

Availability

 

Available only to certain retirement plans.

Initial Sales Charge?

 

No. Entire purchase price is invested in the Fund’s
Class R shares.

Deferred Sales Charge?

 

No.

Account Maintenance and Distribution Fees?

 

0.25% Account Maintenance Fee. 0.25% 
Distribution Fee.

Please see “Your Account — How to Buy, Sell, Transfer and Exchange Shares” in the Fund’s current Prospectus and/or contact your financial adviser, selected securities dealer or other financial intermediary for more information about the purchase, sale, transfer or exchange of the Fund’s Class R shares.

CLASS C CONTINGENT DEFERRED SALES CHARGE WAIVER

The contingent deferred sales charge on Class C shares of the Fund may be reduced or waived for certain retirement plans in connection with redemptions of Class C shares. </R>

 

4  MERRILL LYNCH SMALL CAP VALUE FUND, INC.  

 

 
FINANCIAL STATEMENTS

<R>The financial statements of the Fund are incorporated into the Fund’s Statement of Additional Information by reference to the Fund’s 2002 Semi-Annual Report. You may request a copy of the Fund’s Semi-Annual Report at no charge by calling (800) 637-3863 between 8:30 a.m. and 5:30 p.m. Eastern time on any business day. </R>

 
  MERRILL LYNCH SMALL CAP VALUE FUND, INC. 5 

 

 

<R> FINANCIAL HIGHLIGHTS

The Financial Highlights table is intended to help you understand the Fund’s financial performance for the periods shown. Certain information reflects the financial results for a single Fund share. The total returns in the table represent the rate an investor would have earned or lost on an investment in the Fund (assuming reinvestment of all dividends). This information, other than the information for the six-month period ended September 30, 2002, has been audited by Deloitte & Touche LLP , whose report, along with the Fund’s financial statements, is included in the Fund’s Annual Report to shareholders, which is available upon request. The Fund’s financial statements for the six-month period ended September 30, 2002 are unaudited and included in the Fund’s Semi-Annual Report to shareholders, which is available upon request.

    Class A
  

Increase (Decrease) in
Net Asset Value:

For the Six Month
Period Ended
September 30,
2002
(unaudited) 		For the Year Ended March 31,

2002

2001‡

2000

1999

1998

 

Per Share Operating Performance:

   
 

Net asset value, beginning of period

$24.58

 

$19.81

$22.87

$16.27

$22.03

$17.59

 

Investment income (loss) — net†

(.03

)

(.01

)

.06

(.02

)

(.02

)

(.03

)

 

Realized and unrealized gain
(loss) on investments and from
the Trust — net

(7.19

)

5.84

1.23

8.84

(4.66

)

7.20

 

Total from investment operations

(7.22

)

5.83

1.29

8.82

(4.68

)

7.17

 

Less distributions from realized
gain on investments — net

(.49

)

(1.06

)

(4.35

)

(2.22

)

(1.08

)

(2.73

)

 

Net asset value, end of period

$16.87

 

$24.58

$19.81

$22.87

$16.27

$22.03

 

Total Investment Return:**

   
 

Based on net asset value per share

(29.60

)%‡‡

31.56

%

6.39

%

57.29

%

(22.17

)%

43.18

%

 

Ratios to Average Net Assets:

   
 

Expenses††

1.02

%*

.99

%

1.04

%

1.08

%

1.08

%

1.02

%

 

Investment income (loss) — net

(.27

)%*

(.03

)%

.27

%

(.12

)%

(.10

)%

(.13

)%

 

Supplemental Data:

   
 

Net assets, end of period
(in thousands)

$798,012

 

$1,259,688

$648,806

$491,855

$276,957

$396,198

 

Portfolio turnover

32.11

%##

54.14

%##

42.30

%#

89.18

%

57.82

%

67.02

%

* Annualized.
** Total investment returns exclude the effects of sales charges.
† Based on average shares outstanding.
†† Includes the Fund’s share of the Trust’s allocated expenses.
‡ On September 1, 2000, the Fund converted from a stand-alone investment company to a “feeder” fund that seeks to achieve its investment objective by investing all of its assets in Master Small Cap Value Trust, a mutual fund that has the same investment objective as the Fund. All investments will be made at the Trust level. This structure is sometimes called a “master/feeder” structure.
‡‡ Aggregate total investment returns.
# Portfolio turnover for the Trust for the period September 1, 2000 (commencement of operations of the Trust) to March 31, 2001.
## Portfolio turnover for the Trust.</R>

 
 6 MERRILL LYNCH SMALL CAP VALUE FUND, INC.  

 

 
<R> FINANCIAL HIGHLIGHTS   (continued)

    Class B
  

Increase (Decrease) in
Net Asset Value:

For the Six Month
Period Ended
September 30,
2002
(unaudited) 		For the Year Ended March 31,

2002

2001‡

2000

1999

 1998

 

 Per Share Operating Performance:

   
 

Net asset value, beginning of period

$22.74

 

$18.44

$21.59

$15.37

$21.03

$16.91

 

Investment loss — net†

(.13

)

(.22

)

(.15

)

(.21

)

(.20

)

(.23

)

 

Realized and unrealized gain (loss)  on
investments and from the Trust — net

(6.63

)

5.67

1.15

8.35

(4.43

)

6.90

 

Total from investment operations

(6.76

)

5.45

1.00

8.14

(4.63

)

6.67

 

Less distributions from realized gain on
investments — net

(.44

)

(1.15

)

(4.15

)

(1.92

)

(1.03

)

(2.55

)

 

Net asset value, end of period

$15.54  

$22.74

$18.44

$21.59

$15.37

$21.03

 

Total Investment Return:**

   
 

Based on net asset value per share

(29.96

)%‡‡

30.22

%

5.26

%

55.72

%

(22.96

)%

41.72

%

 

Ratios to Average Net Assets:

   
 

Expenses††

2.05

%*

2.01

%

2.06

%

2.11

%

2.10

%

2.05

%

 

Investment loss — net

(1.29

)%*

(1.04

)%

(.75

)%

(1.14

)%

(1.12

)%

(1.16

)%

 

Supplemental Data:

   
 

Net assets, end of period
(in thousands)

$676,004  

$1,003,961

$563,316

$511,780

$378,610

$611,364

 

Portfolio turnover

32.11

%##

54.14

%##

42.30

%#

89.18

%

57.82

%

67.02

%

* Annualized.
** Total investment returns exclude the effects of sales charges.
† Based on average shares outstanding.
†† Includes the Fund’s share of the Trust’s allocated expenses.
‡ On September 1, 2000, the Fund converted from a stand-alone investment company to a “feeder” fund that seeks to achieve its investment objective by investing all of its assets in Master Small Cap Value Trust, a mutual fund that has the same investment objective as the Fund. All investments will be made at the Trust level. This structure is sometimes called a “master/feeder” structure.
‡‡ Aggregate total investment returns.
# Portfolio turnover for the Trust for the period September 1, 2000 (commencement of operations of the Trust) to March 31, 2001.
## Portfolio turnover for the Trust.</R>

 

  MERRILL LYNCH SMALL CAP VALUE FUND, INC. 7 

 

 
<R> FINANCIAL HIGHLIGHTS   (continued)

    Class C
  Increase (Decrease) in
Net Asset Value: 		For the Six Month
Period Ended
September 30,
2002
(unaudited) 		For the Year Ended March 31,
  2002 2001‡ 2000 1999 1998

Per Share Operating Performance:

 

Net asset value, beginning of period

$22.30

$18.13

 

$21.32

 

$15.21

 

$20.83

 

$16.77

 
 

Investment loss — net†

(13

)

(.23

)

(.15

)

(.21

)

(.20

)

(.23

)

 

Realized and unrealized gain
(loss) on investments and from
the Trust — net

(6.50

)

5.58

 

1.14

 

8.25

 

(4.38

)

6.84

 
 

Total from investment operations

(6.63

)

5.35

 

.99

 

8.04

 

(4.58

)

6.61

 
 

Less distributions from realized gain
on investments — net

(.44

)

(1.18

)

(4.18

)

(1.93

)

(1.04

)

(2.55

)

 

Net asset value, end of period

$15.23

$22.30

 

$18.13

 

$21.32

 

$15.21

 

$20.83

 
 

Total Investment Return:**

                     
 

Based on net asset value per share

(29.94

)%#

30.23

%

5.29

%

56.98

%

(22.99

)%

41.74

%

 

Ratios to Average Net Assets:

                     
 

Expenses††

2.06

%*

2.02

%

2.08

%

2.12

%

2.12

%

2.06

%

 

Investment loss — net

(1.30

)%*

(1.11

)%

(.75

)%

(1.16

)%

(1.14

)%

(1.17

)%

 

Supplemental Data:

                     

Net assets, end of period
(in thousands)

$370,399

$504,537

$140,610

$67,390

$38,249

$70,159

Portfolio turnover

32.11

%###

54.14

%###

42.30

%##

89.18

%

57.82

%

67.02

%

* Annualized.
** Total investment returns exclude the effects of sales charges.
† Based on average shares outstanding.
†† Includes the Fund’s share of the Trust’s allocated expenses.
‡ On September 1, 2000, the Fund converted from a stand-alone investment company to a “feeder” fund that seeks to achieve its investment objective by investing all of its assets in Master Small Cap Value Trust, a mutual fund that has the same investment objective as the Fund. All investments will be made at the Trust level. This structure is sometimes called a “master/feeder” structure.
# Aggregate total investment returns.
## Portfolio turnover for the Trust for the period September 1, 2000 (commencement of operations of the Trust) to March 31, 2001.
### Portfolio turnover for the Trust.</R>

 

  8 MERRILL LYNCH SMALL CAP VALUE FUND, INC.  

 

 
<R> FINANCIAL HIGHLIGHTS   (concluded)

    Class D
  Increase (Decrease) in
Net Asset Value: 		For the Six Month
Period Ended
September 30,
2002
(unaudited)
For the Year Ended March 31 ,
  2002   2001‡   2000   1999   1998  
 

Per Share Operating Performance:

                       
 

Net asset value, beginning of period

$24. 45  

$19.73

 

$22.80

 

$16.19

 

$21.97

 

$17.56

 
 

Investment loss — net†

(.05 )

(.07

)

—

‡‡

(.07

)

(.06

)

(.08

)

 

Realized and unrealized gain (loss) on
investments and from the Trust — net

(7.14 )

6.08

 

1.23

 

8.82

 

(4.65

)

7.18

 
 

Total from investment operations

(7.19 )

6.01

 

1.23

 

8.75

 

(4.71

)

7.10

 
 

Less distributions from realized gain
on investments — net

(.48 )

(1.29

)

(4.30

)

(2.14

)

(1.07

)

(2.69

)

 

Net asset value, end of period

$16.78

$24.45

 

$19.73

 

$22.80

 

$16.19

 

$21.97

 
 

Total Investment Return:**

                   
 

Based on net asset value per share

(29.64 )%#

31.17

%

6.11

%

56.98

%

(22.37

)%

42.80

%

 

Ratios to Average Net Assets:

                   
 

Expenses††

1.27 %*

1.25

%

1.30

%

1.33

%

1.33

%

1.27

%

 

Investment loss — net

(.51 )%*

(.30

)%

(.02

)%

(.37

)%

(.35

)%

(.39

)%

 

Supplemental Data:

                   
 

Net assets, end of period
(in thousands)

$342,129

$467,733

 

$198,094

 

$151,650

 

$82,279

 

$114,183

 
 

Portfolio turnover

32.11 %###

54.14

%###

42.30

%##

89.18

%

57.82

%

67.02

%

* Annualized.
** Total investment returns exclude the effects of sales charges.
† Based on average shares outstanding.
†† Includes the Fund’s share of the Trust’s allocated expenses.
‡ On September 1, 2000, the Fund converted from a stand-alone investment company to a “feeder” fund that seeks to achieve its investment objective by investing all of its assets in Master Small Cap Value Trust, a mutual fund that has the same investment objective as the Fund. All investments will be made at the Trust level. This structure is sometimes called a “master/feeder” structure.
‡‡ Amount in less than $.01 per share.
# Aggregate total investment returns.
## Portfolio turnover for the Trust for the period September 1, 2000 (commencement of operations of the Trust) to March 31, 2001.
### Portfolio turnover for the Trust.</R>

 
  MERRILL LYNCH SMALL CAP VALUE FUND, INC. 9 



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  MERRILL LYNCH SMALL CAP VALUE FUND, INC.  



<R>Code # SCV-PR/SAI-0203SUP</R>

     

 

 

 

PART C. OTHER INFORMATION

Item 23.  Exhibits.

Exhibit
Number
Description
<R>
1 (a) — Articles of Incorporation of the Registrant, dated February 22, 1978.(a)
  (b) — Articles of Amendment to Articles of Incorporation of the Registrant, dated October 3, 1988.(a)
  (c) — Articles Supplementary to the Articles of Incorporation of the Registrant, dated October 17, 1994.(a)
  (d) — Articles of Amendment to the Articles of Incorporation of the Registrant, dated October 17, 1994.(a)
  (e) — Articles of Amendment to the Articles of Incorporation of the Registrant, dated May 2, 2000. (b)
  (f) — Articles of Amendment to the Articles of Incorporation of the Registrant, dated July 31, 2000.(c)
  (g) — Articles of Transfer from the Registrant to the Master Special Value Trust, (the “Trust”) dated September 5, 2000.(l)
  (h) — Articles Supplementary Increasing the Authorized Capital Stock of the Corporation and Creating an Additional Class of Common Stock, dated December 9, 2002.
2   — By-Laws of the Registrant.(d)
3   — Portions of the Articles of Incorporation, as amended, and the By-Laws of the Registrant defining the rights of holders of shares of common stock of the Registrant.(e)
4   — Not Applicable
5   — Form of Distribution Agreement between the Registrant and FAM Distributors, Inc.(f)
6   — None.
7   — Not Applicable.
8 (a) — Form of Administration Agreement between the Registrant and Fund Asset Management, L.P.(c)
(b)(1) — Form of Transfer Agency, Dividend Disbursing Agency and Shareholder Servicing Agency Agreement between the Registrant and Financial Data Services, Inc.(a)
(b)(2) — Amendment to the Transfer Agency, Dividend Disbursing Agency and Shareholder Servicing Agency Agreement.(i)
(b)(3) — Amendment to the Transfer Agency, Dividend Disbursing Agency and Shareholder Servicing Agency Agreement, dated January 1, 2003.
  (c) — Form of Administrative Services Agreement between the Registrant and State Street Bank and Trust Company.(k)
9   — Opinion and Consent of Brown & Wood LLP , counsel to the Registrant.(g)
10   — Consent of Deloitte & Touche LLP , independent auditors for the Registrant and the Trust.
11   — None.
12   — None.
13 (a) — Form of Amended and Restated Class B Distribution Plan of the Registrant.(h)
  (b) — Form of Amended and Restated Class C Distribution Plan of the Registrant.(h)
  (c) — Form of Amended and Restated Class D Distribution Plan of the Registrant.(h)
  (d) — Form of Class R Distribution Plan.(m)
14   — Revised Merrill Lynch Select Pricing SM System Plan pursuant to Rule 18f-3.(n)
15   — Code of Ethics.(j)</R>
(a)   Previously filed with Post-Effective Amendment No. 21 to the Registrant’s Registration Statement on Form N-1A under the Securities Act of 1933, as amended (File No. 2-60836) (the “Registration Statement”) on July 28, 1995.
(b)   Previously filed with Post-Effective Amendment No. 27 to the Registrant’s Registration Statement on July 28, 2000.
(c)   Previously filed with Post-Effective Amendment No. 28 to the Registrant’s Registration Statement on August 3, 2000.
(d)   Previously filed with Post-Effective Amendment No. 19 to the Registrant’s Registration Statement on July 28, 1994.
(e)   Reference is made to Article IV, Article V (Sections 3, 5, 6 and 7), Articles VI, VII and IX of the Registrant’s Articles of Incorporation, as amended, filed as Exhibits 1(a), 1(b), 1(c) and 1(d) to the Registration Statement and to Article II, Article III (Sections 1, 3, 5 and 6), Articles VI, VII, XIII and XIV of the Registrant’s By-Laws, previously filed as Exhibit 2 to the Registrant’s Statement.

 
  C-1  

 

 

(f)   Incorporated by reference to Exhibit 5 to Post-Effective Amendment No. 38 to the Registration Statement on Form N-1A of Merrill Lynch Balanced Capital Fund, Inc. (File No. 2-49007) filed on June 30, 2000.
(g) Previously filed with Post-Effective Amendment No. 25 to the Registrant’s Registration Statement on May 26, 1999.
(h)   Incorporated by reference to Exhibit 13 to Post-Effective Amendment No. 38 to the Registration Statement on Form N-1A of Merrill Lynch Balanced Capital Fund, Inc. (File No. 2-49007) filed on June 30, 2000.<R>
(i)   Previously filed with Post-Effective Amendment No. 31 to the Registrant’s Registration Statement on July 25, 2002.</R>
(j)   Incorporated by reference to Exhibit 15 to Post-Effective Amendment No. 9 to the Registration Statement on Form N-1A of Merrill Lynch Multi-State Limited Maturity Municipal Series Trust (File No. 33-50417) filed on November 22, 2000.
(k)   Incorporated by reference to Exhibit 8(d) to Post-Effective Amendment No. 1 to the Registration Statement on Form N-1A of Merrill Lynch Focus Twenty Fund, Inc. (File No. 333-89775) filed on March 20, 2001.
(l)   Previously filed with Post-Effective Amendment No. 30 to the Registrant’s Registration Statement on July 12, 2001.<R>
(m)   Incorporated by reference to Exhibit 13(d) to Post-Effective Amendment No. 32 to the Registration Statement on Form N-1A of Merrill Lynch Basic Value Fund, Inc. (File No. 2-58521), filed on December 20, 2002.
(n)   Incorporated by reference to Exhibit 14 to Post-Effective Amendment No. 32 to the Registration Statement on Form N-1A of Merrill Lynch Basic Value Fund, Inc. (File No. 2-58521), filed on December 20, 2002.</R>

Item 24.   Persons Controlled by or under Common Control with Registrant.

     The Registrant is not controlled by or under common control with any other person.

Item 25.   Indemnification.

     Reference is made to Article VI of the Registrant’s Articles of Incorporation, Article VI of the Registrant’s By-Laws, Section 2-418 of the Maryland General Corporation Law and Section 9 of the Distribution Agreement.

     Insofar as the conditional advancing of indemnification monies for actions based on the Investment Company Act of 1940, as amended (the “Investment Company Act”) may be concerned, Article VI of the Registrant’s By-Laws provides that such payments will be made only on the following conditions: (i) advances may be made only on receipt of a written affirmation of such person’s good faith belief that the standard of conduct necessary for indemnification has been met and a written undertaking to repay any such advance if it is ultimately determined that the standard of conduct has not been met and (ii) (a) such promise must be secured by a security for the undertaking in form and amount acceptable to the Registrant, (b) the Registrant is insured against losses arising by receipt of the advance, or (c) a majority of a quorum of the Registrant’s disinterested, non-party Directors, or an independent legal counsel in a written opinion, shall determine, based upon a review of readily available facts, that at the time the advance is proposed to be made, there is reason to believe that the person seeking indemnification will ultimately be found to be entitled to indemnification.

     In Section 9 of the Distribution Agreement relating to the securities being offered hereby, the Registrant agrees to indemnify the Distributor and each person, if any, who controls the Distributor within the meaning of the Securities Act of 1933, as amended (the “Securities Act”), against certain types of civil liabilities arising in connection with the Registration Statement or Prospectus and Statement of Additional Information.

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

 
  C-2  

 

Item 26.   Business and Other Connections of Investment Adviser.

     <R>Fund Asset Management, L.P. (“FAM” or the “Investment Adviser”) acts as the investment adviser for a number of affiliated open-end and closed-end registered investment companies.

     Merrill Lynch Investment Managers, L.P. (“MLIM”), an affiliate of the Investment Adviser, acts as the investment adviser for a number of affiliated open-end and closed-end registered investment companies, and also acts as sub-adviser to Merrill Lynch World Strategy Portfolio and Merrill Lynch Basic Value Equity Portfolio, two investment portfolios of EQ Advisors Trust.

     The address of each of these registered investment companies is P.O. Box 9011, Princeton, New Jersey 08543-9011, except that the address of Merrill Lynch Funds for Institutions Series is One Financial Center, 23rd Floor, Boston, Massachusetts 02111-2665. The address of the Investment Adviser, MLIM, Princeton Services, Inc. (“Princeton Services”) and Princeton Administrators, L.P. (“Princeton Administrators”) is also P.O. Box 9011, Princeton, New Jersey 08543-9011. The address of FAM Distributors, Inc., (“FAMD”) is P.O. Box 9081, Princeton, New Jersey 08543-9081. The address of Merrill Lynch, Pierce, Fenner & Smith Incorporated (“Merrill Lynch”) and Merrill Lynch & Co., Inc. (“ML & Co.”) is World Financial Center, North Tower, 250 Vesey Street, New York, New York 10080. The address of the Fund’s transfer agent, Financial Data Services, Inc. (“FDS”), is 4800 Deer Lake Drive East, Jacksonville, Florida 32246-6484.</R>

 
  C-3  

 

 

     Set forth below is a list of each executive officer and partner of the Investment Adviser indicating each business, profession, vocation or employment of a substantial nature in which each such person or entity has been engaged since April 1, 2000 for his, her or its own account or in the capacity of director, officer, partner or trustee. In addition, Mr. Glenn is President and Mr. Burke is First Vice President and Treasurer of all or substantially all of the investment companies described in the first two paragraphs of this Item 26, and Mr. Doll is an officer of one or more of such companies.

Name
      Position(s) with the
Investment Adviser
      Other Substantial Business,
Profession, Vocation or Employment
ML & Co   Limited Partner   Financial Services Holding Company; Limited Partner of MLIM
         
Princeton Services   General Partner   General Partner of MLIM
         
Robert C. Doll, Jr.   President   President of MLIM; Co-Head (Americas Region) of MLIM from 2000 to 2001 and Senior Vice President thereof from 1999 to 2001; Director of Princeton Services; Chief Investment Officer of Oppenheimer Funds, Inc. in 1999 and Executive Vice President thereof from 1991 to 1999
         
Terry K. Glenn   Executive Vice President   President of Merrill Lynch Mutual Funds; Chairman (Americas Region) and Executive Vice President of MLIM; Executive Vice President and Director of Princeton Services; President and Director of FAMD; President of Princeton Administrators; Director of FDS
         
Donald C. Burke   First Vice President
and Treasurer 		  First Vice President, Treasurer and Director of Taxation of MLIM; Senior Vice President and Treasurer of Princeton Services; Vice President of FAMD
         
Philip L. Kirstein   General Counsel   General Counsel of MLIM (Americas Region); Senior Vice President, General Counsel, Director and Secretary of Princeton Services
         
Debra W. Landsman-Yaros   Senior Vice President   Senior Vice President of MLIM; Senior Vice President of Princeton Services; Vice President of FAMD
         
Stephen M. M. Miller   Senior Vice President   Senior Vice President of MLIM; Executive Vice President of Princeton Administrators; Senior Vice President of Princeton Services
         
Mary E. Taylor   Head (Americas
Region) 		  Head (Americas Region) of MLIM; Senior Vice President of ML & Co.

Item 27.   Principal Underwriters.

     <R>(a) FAMD acts as the principal underwriter for the Registrant and for each of the following open-end registered investment companies: Financial Institutions Series Trust, Mercury Basic Value Fund, Inc., Mercury Global Holdings, Inc., Mercury Funds II, Mercury Large Cap Series Funds, Inc., Mercury Small Cap Value Fund, Inc., Mercury U.S. High Yield Fund, Inc., Merrill Lynch Balanced Capital Fund, Inc., Merrill Lynch Basic Value Fund, Inc., Merrill Lynch Bond Fund, Inc., Merrill Lynch California Municipal Series Trust, Merrill Lynch Developing Capital Markets Fund, Inc., Merrill Lynch Disciplined Equity Fund, Inc., Merrill Lynch Dragon Fund, Inc., Merrill Lynch Emerging Markets Debt Fund, Inc., Merrill Lynch Equity Income Fund, Merrill Lynch EuroFund, Merrill Lynch Focus Twenty Fund, Inc., Merrill Lynch Focus Value Fund, Inc., Merrill Lynch Fundamental Growth Fund, Inc., Merrill Lynch Funds for Institutions Series, Merrill Lynch Global Allocation Fund, Inc., Merrill Lynch Global Balanced Fund of Mercury Funds, Inc., Merrill Lynch Global Financial Services Fund, Inc., Merrill Lynch Global Bond Fund for Investment and Retirement, Merrill Lynch Global Growth Fund, Inc., Merrill Lynch Global SmallCap Fund, Inc., Merrill Lynch Global Technology Fund, Inc., Merrill Lynch Global Value Fund, Inc., Merrill Lynch Healthcare Fund, Inc., Merrill Lynch Index Funds, Inc., Merrill Lynch International Equity Fund, Merrill Lynch International Fund of Mercury Funds, Inc., Merrill Lynch Latin America Fund, Inc., Merrill Lynch Large Cap Growth V.I. Fund of Mercury V.I. Funds, Inc., Merrill Lynch Large Cap Series Funds, Inc., Merrill Lynch Multi-State Municipal Series Trust, Merrill Lynch Municipal Bond Fund, Inc., Merrill Lynch Municipal Series Trust, Merrill Lynch Natural Resources Trust, Merrill Lynch Pacific Fund, Inc., Merrill Lynch Pan-European Growth Fund of Mercury Funds, Inc., Merrill Lynch Ready Assets Trust, Merrill Lynch Retirement Series Trust, Merrill Lynch Series Fund, Inc., Merrill Lynch Short Term U.S. Government Fund, Inc., Merrill Lynch Small Cap Value Fund, Inc., Merrill Lynch U.S. Government Mortgage Fund, Merrill Lynch U.S. High Yield Fund, Inc., Merrill Lynch U.S. Treasury Money Fund, Merrill Lynch U.S.A. Government Reserves, Merrill Lynch Utilities and Telecommunications Fund, Inc., Merrill Lynch Variable Series Funds, Inc., Merrill Lynch World Income Fund, Inc. and The Asset Program, Inc. FAMD also acts as the principal underwriter for the following closed-end registered investment companies: Merrill Lynch Senior Floating Rate Fund, Inc. and Merrill Lynch Senior Floating Rate Fund II, Inc.</R>

 
  C-4  

 

 

     (b) Set forth below is information concerning each director and officer of FAMD. The principal business address of each such person is P.O. Box 9081, Princeton, New Jersey 08543-9081, except that the address of Messrs. Breen and Wasel is One Financial Center, 23rd Floor, Boston, Massachusetts 02111-2665.

Name
      Position(s) and Office(s)
with FAMD
      Position(s) and Office(s)
with Registrant
        
Terry K. Glenn       President and Director       President and Director  
Michael G. Clark   Treasurer and Director   None  
Thomas J. Verage   Director   None  
Michael J. Brady   Vice President   None  
William M. Breen   Vice President   None  
Donald C. Burke   Vice President   Vice President and Treasurer  
Debra W. Landsman-Yaros   Vice President   None  
William Wasel   Vice President   None  
Robert Harris   Secretary   None  

     (c) Not applicable.

Item 28.    Location of Accounts and Records.

     All accounts, books and other documents required to be maintained by Section 31(a) of the Investment Company Act and the rules thereunder are maintained at the offices of the Registrant (800 Scudders Mill Road, Plainsboro, New Jersey 08536), and its transfer agent, Financial Data Services, Inc. (4800 Deer Lake Drive East, Jacksonville, Florida 32246-6484).

Item 29.   Management Services.

     Other than as set forth under the caption “Management of the Fund — Fund Asset Management” in the Prospectus constituting Part A of the Registration Statement and under “Management of the Fund —Management and Advisory Arrangements” in the Statement of Additional Information constituting Part B of the Registration Statement, the Registrant is not a party to any management-related service contract.

Item 30.   Undertakings.

     Not applicable.

 
  C-5  

 

 

SIGNATURES

     <R>Pursuant to the requirements of the Securities Act and the Investment Company Act, the Registrant certifies that it meets all of the requirements for effectiveness of this Registration Statement pursuant to Rule 485(b) under the Securities Act and has duly caused this Registration Statement to be signed on its behalf by the undersigned, duly authorized, in the Township of Plainsboro, and State of New Jersey, on the 3rd day of February, 2003.</R>

M ERRILL L YNCH S MALL C AP V ALUE F UND , I NC.
(Registrant)
 

By:

/s/ D ONALD C. B URKE
 
  Donald C. Burke,
Vice President and Treasurer

     Pursuant to the requirements of the Securities Act, this Post-Effective Amendment to the Registration Statement has been signed below by the following persons in the capacities and on the date(s) indicated.

 

Signature

   

Title

   

Date

 

T ERRY K. G LENN *

 

President and Director
   (Principal Executive Officer)

   
 

(Terry K. Glenn)

 

 

   
           

D ONALD C. B URKE *

 

Vice President and Treasurer
   (Principal Financial and Accounting
   Officer)

   
 

(Donald C. Burke)

 

  

   
           
  D ONALD W. B URTON *
 

Director

   

(Donald W. Burton)

       
           
  M. C OLYER C RUM *
 

Director

   
 

(M. Colyer Crum)

       
           
  L AURIE S IMON H ODRICK *
 

Director

   
 

(Laurie Simon Hodrick)

       
           
  J. T HOMAS T OUCHTON *
 

Director

   
 

(J. Thomas Touchton)

       
           
  F RED G. W EISS *
 

Director

   
 

(Fred G. Weiss)

       
           

*By:

/s/ D ONALD C. B URKE

     

<R>February 3, 2003</R>

 

(Donald C. Burke, Attorney-in-Fact)

       

 

  C-6  

 

 

SIGNATURES

     <R>Master Small Cap Value Trust has duly caused this Registration Statement of Merrill Lynch Small Cap Value Fund, Inc. to be signed on its behalf by the undersigned, thereunto duly authorized, in the Township of Plainsboro, and State of New Jersey, on the 3rd day of February, 2003.</R>

M ASTER S MALL C AP V ALUE T RUST
(Registrant)

   

By:

/s/ D ONALD C. B URKE

 
 

Donald C. Burke,
Vice President and Treasurer

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

 

Signature

   

Title

   

Date

T ERRY K. G LENN *

 

President and Trustee
   (Principal Executive Officer)

   
 

(Terry K. Glenn)

 

 

   
           
 

D ONALD C. B URKE *

 

Vice President and Treasurer (Principal    Financial and Accounting Officer)

   
 

(Donald C. Burke)

 

  

   
           
  D ONALD W. B URTON *
 

Trustee

   
 

(Donald W. Burton)

       
           
  M. C OLYER C RUM *
 

Trustee

   
 

(M. Colyer Crum)

       
           
  L AURIE S IMON H ODRICK *
 

Trustee

   
 

(Laurie Simon Hodrick)

       
           
  J. T HOMAS T OUCHTON *
 

Trustee

   
 

(J. Thomas Touchton)

       
           
  F RED G. W EISS *
 

Trustee

   
 

(Fred G. Weiss)

       
           

*By:

/s/ D ONALD C. B URKE

     

<R>February 3, 2003</R>

 

(Donald C. Burke, Attorney-in-Fact)

       

 

  C-7  

 

 

<R> EXHIBIT INDEX

Exhibit
Number
Description
1 (h) — Articles Supplementary Increasing the Authorized Capital Stock of the Corporation and Creating an Additional Class of Common Stock, dated December 9, 2002.
8 (a)(3) — Amendment to the Transfer Agency, Dividend Disbursing Agency, and Shareholder Servicing Agreement, dated January 1, 2003.
10
  — Consent of Deloitte & Touche LLP , independent auditors for the Registrant.</R>

 

 

Exhibit 1(h)

Articles Supplementary Increasing the Authorized Capital Stock of the Corporation and Creating an Additional Class of Common Stock

MERRILL LYNCH SMALL CAP VALUE FUND, INC. (hereinafter called the "Corporation"), a Maryland corporation, having its principal office in the State of Maryland in the City of Baltimore, hereby certifies to the State Department of Assessments and Taxation of the State of Maryland that:

1. The Corporation is registered as an open-end investment company under the Investment Company Act of 1940, as amended, with the authority to issue Four Hundred Million (400,000,000) shares of capital stock as follows: 

       Classes                           Number of Authorized Shares
       -------                           ---------------------------
Class A Common Stock                             100,000,000
Class B Common Stock                             100,000,000
Class C Common Stock                             100,000,000
Class D Common Stock                             100,000,000

                             Total:              400,000,000

All shares of all classes of the Corporation's capital stock have a par value of Ten Cents ($0.10) per share, and an aggregate par value of Forty Million Dollars ($40,000,000).

2. The Board of Directors of the Corporation, acting in accordance with
Section 2- 105(c) of the Maryland General Corporation Law and Article V, paragraph 2 of the Articles of Incorporation, as amended and supplemented, hereby increases the total number of authorized shares of Common Stock of the Corporation by One Hundred Million (100,000,000) and designates such newly authorized shares as Class R Common Stock.

3. The preferences, designations, conversion or other rights, voting powers, restrictions, limitations as to dividends, qualifications or terms or conditions of redemption of Class R Common Stock are as follows:

The Class R Common Stock of the Corporation shall represent the same interest in the Corporation and have identical preferences, designations, conversion or other rights, voting powers, restrictions, limitations as to dividends, qualifications, or terms or conditions of redemption as the Class C Common Stock as of the date of these Articles Supplementary, except as otherwise set forth in the Corporation's charter and further except that:

(i) Expenses related to the distribution of the Class R Common Stock shall be borne solely by such class and such class shall have exclusive voting rights with respect to matters relating to the expenses being borne solely by such class; and

(ii) Such distribution expenses borne solely by Class R Common Stock shall be appropriately reflected (in the manner determined by the Board of Directors) in the net asset value, dividends, distribution and liquidation rights of the shares of such class.

4. After this increase in the number of authorized shares and the classification of the newly authorized shares as Class R Common Stock, the Corporation will have the authority to issue Five Hundred Million (500,000,000) shares of capital stock as follows: 

       Classes                           Number of Authorized Shares
       -------                           ---------------------------
Class A Common Stock                             100,000,000
Class B Common Stock                             100,000,000
Class C Common Stock                             100,000,000
Class D Common Stock                             100,000,000
Class R Common Stock                             100,000,000

                             Total:              500,000,000

After this increase, all shares of all classes of the Corporation's capital stock will have a par value of Ten Cents ($0.10) per share, and an aggregate par value of Fifty Million Dollars ($50,000,000).

2

IN WITNESS WHEREOF, MERRILL LYNCH SMALL CAP VALUE FUND, INC. has caused these presents to be signed in its name and on its behalf by its President and attested by its Secretary on December 9, 2002.

MERRILL LYNCH SMALL CAP VALUE FUND, INC. 

                                             By: /s/ Terry K. Glenn
                                                 -------------------------------
                                                 Terry K. Glenn
                                                 President

Attest:

/s/ Susan B. Baker
-------------------------------
Susan B. Baker
Secretary

The undersigned, President of MERRILL LYNCH SMALL CAP VALUE FUND, INC. who executed on behalf of said Corporation the foregoing Articles Supplementary, of which this certificate is made a part, hereby acknowledges the foregoing Articles Supplementary to be the corporate act of said Corporation and further certifies that as to all of the matters and facts required to be verified under oath, that to the best of his knowledge, information and belief, the matters set forth therein are true in all material respects, under the penalties of perjury. 

Dated: December 9, 2002                          /s/ Terry K. Glenn
                                                 -------------------------------
                                                 Terry K. Glenn
                                                 President

3

Exhibit 8(a)(3)

AMENDMENT
TO THE
TRANSFER AGENCY, DIVIDEND DISBURSING AGENCY AND
SHAREHOLDER SERVICING AGENCY AGREEMENT

WHEREAS, Financial Data Services, Inc. ("FDS") and Merrill Lynch Small Cap Value Fund, Inc. (the "Fund"), on behalf of its self and certain of its series, entered into a Transfer Agency, Dividend Disbursing Agency and Shareholder Servicing Agency Agreement as amended (the "Agreement");

WHEREAS, the parties hereto desire to amend the Agreement to reflect the Fund's issuance of Class R shares; and

WHEREAS, the parties hereto desire to amend the Agreement to reflect services FDS may provide to the Fund in connection with the Fund's money laundering prevention programs and compensation to FDS for such services.

NOW, THEREFORE, FDS end the Fund hereby amend the Agreement as follows:

1. The parties agree that, in order to more accurately reflect the conduct of their business relationship, Paragraph 3(f) of the Agreement shall be re-designated Paragraph 3(g) and a new Paragraph 3(f) added to read in its entirety: "FDS agrees to perform such anti-money laundering ("AML") functions with respect to the Fund's shares as the Fund or its agent may delegate to FDS from time to time or as FDS is otherwise obligated to perform. In accordance with mutually-agreed procedures, FDS shall use its best efforts in carrying out such functions under the Fund's AML program. Fund shareholders (which for this purpose shall mean only shareholders of record) are customers of the Fund and not customers of FDS and the Fund retains legal responsibility under the USA PATRIOT Act for AML compliance with respect to transactions in Fund shares." FDS agrees to cooperate with any request from examiners of US Government agencies having jurisdiction over the Fund for information and records relating to the Fund's AML program and consents to inspections by such examiners for this purpose.

2. The parties agree that the compensation payable in connection with certain accounts will be modified. Pursuant to Section 4 of the Agreement, the compensation payable to FDS on services for such accounts is set forth in the Amended and Restated Schedule of Fees attached to this Amendment, which shall become a part of the Agreement and shall be effective January 1, 2003.

IN WITNESS HEREOF, the parties hereto have executed this Amendment as of this 1st day of January, 2003.

MERRILL LYNCH SMALL CAP VALUE FUND, INC. 

By:    /s/ Donald C. Burke
     ----------------------------
           Donald C. Burke
           Treasurer

FINANCIAL DATA SERVICES, INC. 

By:    /s/ Sharon L. Hockersmith
     ----------------------------
           Sharon L. Hockersmith
           Vice President

AMENDED AND RESTATED
SCHEDULE OF FEES
MERRILL LYNCH MUTUAL FUNDS

Transfer Agency and Record-keeping Fees:

The Fund shall pay monthly the following transfer agency and record-keeping fees to FDS, unless otherwise noted: 

--------------------------------------------------------------------------------
Proprietary Retail(1)                              $16           $19
--------------------------------------------------------------------------------
Third Party(2)                                     $16           $19
--------------------------------------------------------------------------------
Direct Account                                     $20           $23
--------------------------------------------------------------------------------
MFA ERISA(3)                                       0.10%         0.10%
--------------------------------------------------------------------------------
RG Recordkept Plans(4)                             $16           $19
--------------------------------------------------------------------------------
ML Connect Network Plans(5)                        $16           S19
--------------------------------------------------------------------------------

NOTES:

1. Shares, are sold through Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPF&S"), excluding MFA ERISA accounts. Certain MLPF&S fee-based program accounts are subject to separately negotiated transfer agency and record-keeping fees.

2. Shares are sold through broker-dealers other than MLPF&S.

3. Shares are held through the MLPF&S MFA (Mutual Fund Advisor) program, or any other fee-based program, in accounts requiring equalization under ERISA. Fees are calculated based on average daily net assets.

4. Shares are sold to participants of a defined benefit or defined contribution plan (a "Plan") that is recordkept by Merrill Lynch.

5. Shares are sold to participants of a Plan for which a third-party administrator (currently BISYS, Paychex, Inc., Invesco Retirement, Inc., MFS and Oppenheimer Funds) is the record-keeper pursuant to certain agreements with Merrill Lynch.

6. Fees apply to accounts that are active for any portion of a month.

2

Out-of-Pocket Expenses:

The Fund shall pay the following out-of-pocket costs incurred by FDS:

o AML compliance costs, including, but not limited to, legal fees, reporting agency fees, and incremental personnel expenses, but only insofar as any of the foregoing fees and expenses relate to "direct" individual accounts. The Fund shall not pay for any costs related to the underlying beneficial owners of any omnibus or other similar type of accounts.

o Postage

o Special Mail processing expenses, including, but not limited to, postal presort, householding, exception extract, and duplicate elimination)

o Envelopes/stationery

o Record storage and retrieval

o Telephone (local and long distance)

o Pre-authorized checks

o Returned check fees/charges and other similar fees/charges

o Handling costs or similar supplemental charges imposed by ADP or other vendor delivering goods and services related to the Agreement

o Fed wire charges, excluding wires to/from Fund custody accounts

o Forms

o Any other costs as mutually agreed by the parties

Estimated miscellaneous out-of-pocket expenses are paid monthly based on an annualized rate of $0.04 per account. This estimated expense rate may be increased or decreased periodically, as necessary, to more accurately reflect anticipated actual expenses. On a semi-annual basis, the actual miscellaneous out-of-pocket expenses incurred will be compared to the estimated out-of-pocket expense paid. The appropriate adjustment will be made by FDS Finance or MLIM Accounts Payable at that time.

Extraordinary Expenses:

The fees and expense reimbursements described above do not cover extraordinary services, including, but not limited to, administration of a reorganization or liquidation of the Fund, remedial actions necessitated by errors or omissions of the Fund or any of its agents, or conversion of the Fund to another transfer agent. Fees and expenses reimbursements, in connection with extraordinary services, will be mutually agreed by the parties prior to the performance of such services.

3

 
EXHIBIT 10

INDEPENDENT AUDITORS’ CONSENT

We consent to the incorporation by reference in Post-Effective Amendment No. 32 to Registration Statement No. 2-60836 on Form N-1A of our reports dated May 10, 2002 on Merrill Lynch Small Cap Value Fund, Inc. (the “Fund”) and Master Small Cap Value Trust, both appearing in the March 31, 2002 Annual Report of the Fund, and to the reference to us under the caption “Financial Highlights” in the Prospectus, which is part of such Registration Statement.

/s/ Deloitte & Touche LLP

New York, New York
January 31, 2003