EXPENSE CAP/REIMBURSEMENT AGREEMENT

     This Agreement is entered into as of the 14th day of February, 2006 between
KEELEY ASSET MANAGEMENT CORP. (the "Adviser") and KEELEY FUNDS, Inc. (the
"Company") on behalf of KEELEY All Cap Value Fund (the "Fund").

     WHEREAS, the Adviser desires to contractually agree to waive a portion of
its advisory fee or reimburse certain of the Fund's operating expenses to ensure
that the Fund's total operating expenses do not exceed the level described
below.

     NOW THEREFORE, the parties agree as follows:

     The Adviser agrees that until September 30, 2007, the Adviser will reduce
its compensation with respect to the Fund as provided for in the Investment
Advisory Agreement between the Company and the Adviser dated February 14, 2006,
and/or assume expenses for the Fund to the extent necessary to ensure that the
Fund's total operating expenses (on an annual basis), exclusive of (i) taxes,
(ii) interest charges, (iii) litigation and other extraordinary expenses, and
(iv) brokers' commissions and other charges relating to the purchase and sale of
the Fund's portfolio securities do not exceed 2.00% of the Fund's average daily
net assets. Reimbursed expenses will be determined in the following order:
organizational, offering and all other expenses.

     The Adviser shall be entitled to recoup such amounts for a period of up to
three (3) years following the fiscal year in which the Adviser reduced its
compensation and/or assumed expenses for the applicable Fund, provided that the
total operating expenses including this recoupment do not exceed the established
cap on expenses for that year.



                                      KEELEY FUNDS, INC.

                                      By: /s/ JOHN L. KEELEY, JR.
                                          -----------------------
                                                John L. Keeley, Jr., President



                                      KEELEY ASSET MANAGEMENT CORP.

                                      By: /s/ JOHN L. KEELEY, JR.
                                          -----------------------
                                                John L. Keeley, Jr., President