INTERIM SUB-INVESTMENT MANAGEMENT CONTRACT
AGREEMENT dated as of May 31, 2006 between Xxxx Xxxxxxx Advisers, LLC
("Xxxx Xxxxxxx") (the "Adviser"), a Delaware limited liability company,
Independence Investments, LLC (the "Sub-adviser"), a Delaware limited liability
company, and Xxxx Xxxxxxx Capital Series (the "Trust"), a business trust under
the laws of the Commonwealth of Massachusetts, on behalf of Xxxx Xxxxxxx Core
Equity Fund (the "Fund"), a series of the Trust.
Whereas, the Sub-adviser has acted as investment sub-advisor to the Fund
pursuant to a Sub-Investment Management Contract dated August 30, 1996 as
amended on June 7, 2002 (the "Prior Contract").
Whereas, the Prior Contract has been approved by the Board of Trustees of
the Trust and the shareholders of the Fund.
Whereas, the Prior Contract is being terminated as a result of assignment.
Whereas, the Board of Trustees has determined to appoint the Sub-adviser as
investment sub-adviser to the Fund.
Whereas, this Agreement is being entered into in reliance upon Rule 15a-4
under the Investment Company Act of 1940, as amended (the "Investment Company
Act").
Now therefore the Trust and the Sub-adviser agree as follow:
Section 1. The Trust appoints the Sub-adviser as investment sub-adviser of
the Fund for the period and on the terms set forth herein. The Sub-adviser
accepts such appointment.
Section 2. The Sub-adviser and the Trust, on behalf of the Fund, hereby
agree that the provisions of the Prior Contract (other than as to the term of
the Prior Contract) are incorporated herein by reference and made a part hereof.
Without limiting the forgoing, Sub-adviser shall be entitled to the fee for its
services provided for in the Prior Contract from (but exclusive of) the date
hereof until the termination of this Agreement, except as provided in Section 3
below.
Section 3. In the event that this Agreement is not approved by a majority
of the Trust's outstanding voting securities (as such term is used in the
Investment Company Act), the Sub-adviser shall be entitled to a fee equal to the
lower of the fee under the Prior Contract and the cost to the Sub-adviser of
performing its services under this Agreement in lieu of the fee provided for in
Section 2. For purposes of this Agreement, the Sub-adviser's costs in providing
the services under this Agreement shall be equal to the pro rata portion of the
Sub-adviser's expenses for the term of this Agreement attributable to its
investment company advisory business, calculated as follows: the Sub-adviser's
cost in providing investment advisory services to its investment companies
multiplied by a fraction the numerator of which shall be the average daily net
assets of the Fund during the term of this Agreement and the denominator of
which shall be the average month end net assets under the Sub-adviser's
management of all of its investment company clients.
Section 4. The compensation earned by the Sub-adviser under Section 2 of
this Agreement shall be held in an interest bearing escrow account with the
Fund's custodian. If a majority of the outstanding voting securities approves
this Agreement prior to the end of its term, the amount in the escrow account
(including any interest earned) shall be paid to the Sub-adviser. If a majority
of the outstanding voting securities do not approve this Agreement prior to the
end of its term, the Sub-adviser shall be entitled to be paid, out of the escrow
account the lesser of (i) the amount in the escrow account (including any
interest earned on that amount while in escrow) and (ii) the fee provided for in
Section 3 (plus any interest on that amount while in escrow), with any remaining
amount in the escrow account being returned to the Fund.
Section 5. This Agreement shall become effective on May 31, 2006. Unless
terminated as provided below, this Agreement shall remain in full force and
effect until the earliest of (i) approval of a Sub-Investment Management
Contract between the Fund and the Sub-adviser and (ii) a date that is the later
of 150 days after the date of the termination of the Prior Contract or such
later date as may be consistent with a rule or interpretive position (formal or
informal) of the staff of the Securities and Exchange Commission. This Agreement
may be terminated at any time without payment of penalty by vote of the Trustees
of the Trust or by vote of a majority of the outstanding voting securities of
the Fund. The Sub-adviser may terminate this Agreement at any time without
payment of any penalty on not less than 60 days written notice to the Fund. This
Agreement shall automatically terminate upon its assignment as defined in the
Investment Company Act.
In witness whereof, the parties hereto have executed this Agreement as the
31st day of May, 2006.
XXXX XXXXXXX ADVISERS, LLC
/s/Xxxxx X. Xxxxxxxxx
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By: Xxxxx X. Xxxxxxxxx
Its: President and Chief Executive Officer
XXXX XXXXXXX CAPITAL SERIES
on behalf of Xxxx Xxxxxxx Core Equity Fund
/s/Xxxxx X. Xxxxxxx
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By: Xxxxx X. Xxxxxxx
Its: Assistant Secretary
INDEPENDENCE INVESTMENTS, LLC
/s/Xxxxxx X. Xxxxxx
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By: Xxxxxx X. Xxxxxx
Its: Chief Operating Officer
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