FORM OF
AGREEMENT FOR ACCOUNTING SERVICES
Agreement, made this __ day of ____________, 2004, between Xxxxxxx, Xxxxxx &
Co., a Florida Professional Association, with offices at 0000 Xxxxx Xxxxxxxx
Xxxxx, Xxxxx, Xxxxxxx 00000, (hereinafter referred to as the Firm) and ASA
(Bermuda) Limited c/o LGN Associates, X.X. Xxx 000, Xxxxxxx Xxxx, Xxx Xxxxxx
00000 (hereinafter referred to as the Client).
It is agreed as follows:
1. SERVICES
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Subject to the Client's responsibilities identified in Section 4 of
this agreement, the Firm will maintain the books of record of the
Client and prepare weekly and other periodic net asset values. In
connection with the preparation of each net asset value, the Firm will
obtain values of the Client's portfolio securities in accordance with
the Client's valuation procedures. We will also record general ledger
entries, reconcile activity to the trial balances and prepare account
balances and income statements.
Subject to the responsibilities reflected in Section 4, monthly, the
Firm will prepare the financial statements of the Client including: the
statement of assets and liabilities, the schedule of investments and
related statements of operations, statement of surplus changes in net
assets and cash flows. The financial statements will present
information that is the representation of management. Neither an audit
nor a review will be carried out and accordingly no assurance will be
expressed. The Firm's monthly report on the financial statements of the
Client would be expected to read as follows:
The accompanying statements of assets and liabilities of ASA
(Bermuda) Limited (incorporated in the Republic of South Africa),
as of January 31, 2004 and 2003 including the schedule of
investments, as of January 31, 2004 and the related statements of
operations, surplus and changes in net assets for the four months
ended January 31, 2004 and 2003 and supplementary information
were not audited by us and, accordingly, we do not express an
opinion on them.
If, for any reason, the Firm is unable to complete the preparation of
the Client's financial statements, the Firm will not issue a report as
a result of this engagement.
The Firm will provide financial statement audit liaison services. The
Firm will prepare the Client's annual and semi-annual financial
statements and related footnotes along with the supporting schedules
and workpapers to be provided to the independent auditors. Such
financial statements and footnotes will be prepared in conformance with
United States generally accepted accounting principles and Securities
and Exchange Commission Regulation S-X.
2. TERM
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This Agreement shall become effective ____________, 2004 and shall
continue in force and effect until such time as either party provides
the other with notice of its intent to terminate the agreement within a
period of not less than thirty days and payment of all fees for
services previously rendered has been made.
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It is recognized by the parties that outside the terms of the
Agreement, the Firm is available to provide other services upon request
by the Client. Such services shall be provided under the same terms and
conditions as those covered by the Agreement unless documented by a
separate Agreement.
If during the course of its engagement the Firm encounters
circumstances which it believes may create a conflict of interest or
conflict with the ethical standards of its profession, the Firm will
inform the Client of its concerns. If these concerns cannot be
adequately addressed to the Firm's satisfaction, or the Firm is
compelled to do so by the professional standards of its profession, it
may withdraw from the engagement. Additionally, the Firm reserves the
right to withdraw from the engagement should it encounter circumstances
which conflict with the ethical standards of the Firm.
3. CHARGES
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Fees for our services will be based on the time expended at the Firm's
regular professional rates and will be payable monthly and in arrears
and are $8,500 per month.
Audit liaison services including the preparation of the annual and
semi-annual financial statements including footnotes and supporting
working papers for the auditors will range from $3,000 to $5,000 for
each audit.
The Firm will also xxxx the Client for out-of-pocket costs and expenses
incurred on this engagement including but not limited to travel,
telephone, fax, postage, courier and delivery charges.
Any additional services such as assistance with examination by taxing
or regulatory authorities, accounting services or consultation
concerning financial matters requested during or after the term of this
Agreement will also be billed at the regular professional rates for
such services. The Firm will be entitled to recover from the Client all
reasonable attorney's fees and costs in connection with any litigation,
regulatory investigation or inquiry that may arise out of this
Agreement. Additionally, so long as the Firm is not a party to such
investigation or inquiry, the Client shall reimburse the Firm for its
professional time and expenses.
All services will be billed monthly and shall be payable within ten
(10) days of receipt of such billing.
The Firm reserves the right to suspend or terminate its work due to
nonpayment within terms. In the event that the Firm's work is suspended
or terminated as a result of nonpayment, the Client agrees that the
Firm will not be responsible for the Client's failure to meet
government and other filing deadlines, or for penalties or interest
that may be assessed, or other damages that may be sustained by the
Client or its owners, resulting from the Client's failure to meet said
deadlines.
4. RESPONSIBILITIES
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The services as described in Section 1 are not designed and cannot be
relied upon to disclose errors, fraud, or illegal acts, that may exist,
although their discovery may result from the Firm's engagement.
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The Client will review each month's brokerage statements for
completeness and propriety of all trading activity and identify all
other transactions entered into during each month. Additionally, the
Client will review and corroborate the monthly trial balances and
financial statements and explicitly manifest its responsibility
therefor. The Client acknowledges their responsibility for the accuracy
and completeness of the accounting data underlying the financial
statements and acknowledges its responsibility for the fair
presentation of the financial statements and income tax returns. The
Client further acknowledges its responsibility for timely filing of the
income tax returns, estimated tax payments and other items required to
be paid on a timely basis.
The Client will authorize, execute, consummate, classify and
communicate to the Firm all transactions. The Client is responsible for
management decisions and functions, and for designating a competent
individual, preferably management level, to oversee any bookkeeping
services, income tax services, and other non-financial statement
services we may provide. The Client is responsible for evaluating the
adequacy and results of the services performed and accepting
responsibility for such services. The Client is responsible for
establishing and maintaining internal controls, including monitoring
ongoing activities. None of these services can be relied on to detect
errors, fraud or illegal acts that may exist, however, the Firm will
inform the Client of any items, unless clearly inconsequential, that
comes to the Firm's attention.
The Firm will assist in the preparation of the Client's financial
statements, but the responsibility for the financial statements remains
with the Client. As part of preparing the financial statements the Firm
may propose standard, adjusting, or correcting journal entries to the
Client's financial statements. The Client is responsible for reviewing
the entries and understanding the nature of any proposed entries and
the impact they have on the financial statements. Further, the Client
is responsible for designating a qualified management-level individual
to be responsible and accountable for overseeing these services.
Except in the case of the Firm's bad faith, gross negligence,
fraudulent behavior or willful misconduct, the Client agrees that the
Firm shall have no liabilities to the Client, its owners, directors,
agents, employees, controlling persons or security holders for any
losses, claims, damages or liabilities arising out of or in connection
with this engagement for any amount in excess of the total professional
fees paid by the Client under this agreement for professional
engagement.
The Client agrees that it will not, directly or indirectly, agree to
assign or transfer any claim against the Firm arising out of this
engagement to anyone, except to a successor.
If the Client intends to publish or otherwise reproduce the financial
statements together with the Firm's report (or otherwise make reference
to the Firm) in a document that contains other information, the Client
agrees to (a) provide the Firm with a draft of the document to read;
and (b) obtain the Firm's written approval for inclusion of its report,
before such document is distributed.
5. CLIENT ASSISTANCE
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In order for the Firm to work as efficiently as possible, it is
understood that the Client's staff will provide certain working papers,
information, or documentation which shall be discussed with the
Client's personnel. The services will be completed in as timely a
manner as possible consistent with the conditions of the engagement.
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6. CONFIDENTIALITY AND REQUEST FOR INFORMATION
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With respect to financial, statistical and personnel data relating to
the Client's business which is confidential and which is submitted to
or obtained by the Firm in order to carry out the Agreement, the Firm
will instruct its personnel to keep such information confidential.
The Firm may receive requests for information in its possession arising
out of this engagement. The requests may come from governmental
agencies, courts or other tribunals. If permitted, the Firm will notify
the Client of any request for information prior to responding. In
certain proceedings an accountant-client privilege may exist. The
Client agrees that the Firm is not under any obligation to assert any
privilege to protect the release of information. The Client may, prior
to the Firm's response to any request, initiate legal action to prevent
or limit the Firm's response.
Unless, the Client promptly initiates such action after the Firm
notifies the Client at its last known address as reflected in the
Firm's files, the Firm will release the information requested.
In the event the Firm is requested or authorized by the Client or
required by government regulation, subpoena, or other legal process to
produce our working papers or our personnel as witness with respect to
our engagement the Client will, so long as the Firm is not a party to
the proceeding in which the information is sought, reimburse the Firm
for its professional time and expenses, as well as the fees and
expenses of the Firm's counsel, incurred in responding to such a
request.
The Firm retains ownership of the working papers produced by it in
connection with the performance of services under this agreement.
Access to these working papers other than described above may be
granted to others upon mutual approval of the Client and the Firm.
The books and records prepared and maintained pursuant to Section 1 of
this Agreement shall be prepared and maintained in such form, for such
periods and in such locations as may be required by the Investment
Company Act of 1940, as amended. The books and records pertaining to
the Client that are in possession of the Firm shall be the property of
the Client. The Client, or the Client's authorized representatives,
shall have access to such books and records during the Firm's normal
business hours. Upon the reasonable request of the Client, any such
books and records or copies thereof shall be provided promptly by the
Firm to the Client or the Client's authorized representatives at the
Client's expense. In the event the Client designates a successor that
shall assume any of the Firm's obligations under this Agreement, the
Firm shall, at the expense and direction of the Client, transfer to
such successor all relevant books, records and other data established
or maintained by the Firm under this Agreement.
7. ALTERNATIVE DISPUTE RESOLUTION
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Parties to this engagement agree that any dispute that may arise
regarding the meaning, performance, or enforcement of this Agreement
will, prior to resorting to litigation, be submitted to mediation upon
the written request of any party to the engagement. All mediation
initiated as a result of this engagement shall be administered by the
American Arbitration Association. The results of this mediation shall
be binding only upon agreement of each party to be bound. Costs of any
mediation proceeding shall be shared equally by both parties.
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This Agreement shall be governed and its terms construed in accordance with the
laws of the State of Florida applicable to contracts to be performed in that
State. The waiver by any party hereto of any provision of this Agreement shall
not operate or be construed as a waiver of any subsequent breach by any party.
If any portion of this Agreement is held to be void, invalid, or otherwise
unenforceable, whole or in part, the remaining portions of this Agreement shall
remain in effect. This Agreement supersedes all proposals, oral or written, and
all other communications between the parties relating to the engagement subject
matter.
XXXXXXX, XXXXXX & CO., P.A. ASA (BERMUDA) LIMITED
0000 Xxxxx Xxxxxxxx Xxxxx c/o LGN Associates
Xxxxx, Xxxxxxx 00000 X.X. Xxx 000
Xxxxxxx Xxxx, Xxx Xxxxxx 00000
By:____________________________________ By:__________________________________
By:____________________________________ Title:_______________________________
Date:__________________________________ Date:________________________________
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