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Exhibit 10.2

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MASTER SERVICES AGREEMENT

BETWEEN

EQUANT INC.

AND

QAD INC.

AGREEMENT NUMBER: MSA/US/QAD/06/02/05

DATED: June 6, 2002

Final

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EQUANT MASTER SERVICES AGREEMENT

TABLE OF CONTENTS

Definitions   1 Term   3 Ordering of Services   3   New Services   4   Change
Control Process   4 Invoices, Payment and Taxes   4   Commencement of Invoicing
  4   Payment   4   Taxes   5   Late Payment   5   Billing Disputes   5   Credit
Requirements   5   Additional Pro Forma Invoices   5 Intellectual Property
Rights   6   Ownership of Intellectual Property   6   Indemnification for
Infringement of Intellectual Property Rights   6 Software   6 Confidentiality
and Non-Disclosure   7 Exclusions and Limitations of Liability   7   Limitation
of Warranties   8 Termination   8   Immediate Termination   8   Termination on
Notice   9   Effect of Termination   9 Assignment   10 Governing Law   10
Dispute Resolution   10 General   11   Notices   11   Status of the Parties   11
  Third Party Beneficiaries   11   Sub-Contractors   11   Invalidity   11   No
Waivers   11   Modifications of the Agreement   11   Order of Precedence   11  
Entire Agreement   12   Compliance with Laws   12   Non-Solicitation   12  
Independent Counsel   12   Counterparts   12   Force Majeure   12   Survival  
12 SERVICE ANNEX 1—NETWORK SERVICES   13   Annex 1-A—Additional Terms And
Conditions For Network Services   13     Network Services Definitions   13    
Provision of Service and Support Services—Equant's Obligations   13

DATE ISSUED: June 6, 2002

CONFIDENTIAL
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    Use of the Service—Customer's Obligations   14     CPE   15     Connection
of Services   16     Disconnection of Locations   17     Reservation of Rights  
17   Annex 1-B—Network Services Support   21     Help Desk   21     Global
Support   21     Support Levels   21       Core Network Support   21      
Customer Service Support   21       On-site Support   22       Fault Management
  22         Fault Reporting   22         Fault Diagnosis   22         TO
Problems   22         Equipment Problem   23       Network Problems   23        
Closing Trouble Ticket   23         Escalation Process   23       Support
Services—Tail Circuit Management   23       Support Services—Project Management
  24   Annex 1-C—Network Services Acceptance Tests.   25     Tail Circuit
Testing   25     Frame Relay Functionality Testing   25     PPP Dial Access
Testing   25     Alternative Testing   25   Annex 1-D—Service Descriptions   26
  Equant Frame Relay Service   26     Committed Information Rate   26     Excess
Information Rate   26     Premium Burst Option   26   Annex 1-E—Service Levels  
28     Introduction   28     Conditions and Exclusions   28       P Grade
(X.28/RLA/PPP/CID Dial Services)   28       Mean Time To Attend (MTTA)   29    
  Fault Management   30       Cancellation of Service   30     Definitions   30
      Schedule 1—Service Levels   32   Annex 1-F—Pricing   34       Table 1 to
Annex 1-F Zones for Remote IP Dial Charges   35       Table 2 to Annex 1-F IP
Dial Usage Charges   36       Table 3 to Annex 1-F Monthly IP Dial Fixed Charges
  37       Table 4 to Annex 1-F Frame Relay Charges   38

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This Agreement is made as of April 30, 2002 ("Effective Date") between:

(1)Equant Inc., a company incorporated in Delaware, with its principal place of
business located at 400 Galleria Parkway, Atlanta, Georgia 30339 ("Equant"); and

(2)QAD Inc., a company incorporated in Delaware, with its principal place of
business located at 6450 Via Real, Carpinteria, California 93013 ("Customer").

BACKGROUND

(A)Customer desires to obtain data, voice, and professional services from Equant
in order to facilitate communications between various locations, as described in
the Service Annexes; and

(B)Equant has agreed to provide, and Customer has agreed to use the Services in
accordance with the terms and conditions set out in this Agreement.

IT IS AGREED as follows:

1.DEFINITIONS

In addition to capitalized terms defined elsewhere in this Agreement, the
following capitalized words and phrases have the meanings given below.

    "Affiliate"   means in relation to an entity, any other entity controlled
by, under common control with or controlling such entity, where "control" means
an entity's (a) ownership, directly or indirectly, of equity securities
entitling it to exercise in the aggregate at least 50% of the voting power of
the entity in question; or (b) possession directly or indirectly, of the power
to direct or cause the direction of the management and policies of or with
respect to the entity in question, whether through ownership of securities, by
contract or otherwise.
 
 
"Agreement"
 
means this fully executed Master Services Agreement, including all Service
Annexes, Order Forms, schedules, attachments, exhibits and all amendments to
this Master Services Agreement as may be made in writing and signed by the
Parties.
 
 
"Business Day"
 
means the customary working hours for each day in each country where the
Services are provided (except locally observed holidays in such countries).
 
 
"Changes"
 
means changes to this Agreement effected pursuant to the Change Control Process.
 
 
"Change Control Process"
 
means the process set out in Clause 3.6.
 
 
"Charges"
 
means the fees and rates that Equant will charge Customer for all Services
provided under this Agreement.
 
 
 
 
 

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"Confidential Information"
 
means the contents of this Agreement and all information disclosed (whether in
writing, or orally or whether directly or indirectly) by a Party to the other
Party whether before or after the Effective Date of this Agreement and marked or
indicated "CONFIDENTIAL", including information relating to the disclosing
Party's products and services, operations, customers and prospects, know-how,
design rights, trade secrets, market opportunities or business affairs.
 
 
"CPE"
 
or "Customer Premises Equipment" means the hardware (including cables,
connectors and software) at Locations, as may be supplied by Equant as part of
the Network Services.
 
 
"Date of Acceptance"
 
means the date the Acceptance Tests are successfully completed.
 
 
"Effective Date"
 
means, the date indicated above, or if no date is stated, the latest date
written on the signature blocks of this Agreement.
 
 
"Force Majeure Event"
 
means a cause beyond the reasonable control of a Party affecting the performance
of any of its obligations under this Agreement, as provided in section 13.14.
 
 
"Initial Term"
 
or "Term" means a period of thirty-six (36) months commencing on the Effective
Date.
 
 
"Intellectual Property Rights"
 
means any patents, design rights, copyright, trademarks, trade names, trade
secrets, know-how, in each case, whether registered or unregistered and any
other intellectual property right whatsoever and wherever enforceable.
 
 
"Location"
 
means each User site to be provided with Services, identified in Order Forms.
 
 
"Losses"
 
means all claims, liabilities, demands, proceedings, losses, costs (including
reasonable legal and other professional costs) and reasonable expenses of
whatever nature.
 
 
"Network Services"
 
means the Equant data network services as described in the relevant Service
Descriptions.
 
 
"Network"
 
means Equant's network used by Equant for the provision of the Network Services,
excluding Tail Circuits, public networks and CPE.
 
 
"Order Form"
 
means any of Equant's standard order forms for the Services, prevailing from
time to time.
 
 
"Order"
 
means any request for a Service issued by Customer or a User, using an Order
Form. All Orders are subject to acceptance by Equant.
 
 
"Parties"
 
means Equant and Customer, or individually as a "Party".
 
 
"Service Annexes"
 
means the annexes to this Agreement attached hereto and detailing Service
specific additional terms and conditions, Service descriptions, the SLA(s), and
the schedule of Charges.
 
 
 
 
 

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"Service Level"
 
or "Service Level Agreement" or "SLA" means the required level of service that
Equant shall provide to Customer.
 
 
"Services"
 
means the services to be provided by Equant to Customer under this Agreement,
described in the applicable Service Annexes.
 
 
"Software"
 
means computer programs in object code, as applicable, provided or to be
provided by Equant pursuant to this Agreement, and excluding any proprietary
Software provided by Customer.
 
 
"Tail Circuit"
 
means a telecommunications circuit or other capacity and attached modems leased
from a TO connecting Locations to the Network.
 
 
"Target Date"
 
means the expected date for delivery and acceptance of Network Services, as set
out in Order Forms.
 
 
"TO"
 
or "Telecommunications Operator" means an entity authorized to own, lease and
operate telecommunications circuits.
 
 
"Users"
 
means users of the Services under this Agreement, excluding Customer, who have
been authorized by Equant in writing, and will include the entity or entities
that are designated in an Order Form as the recipient of the Services.

The terms defined above include the plural as well as the singular. Any
reference to a "Clause" means a clause of the document in which it appears
unless otherwise expressly stated. The words "include" and "including" will not
be construed as terms of limitation. Use of the word "or" means and/or. The
words "day", "month", and "year" mean, respectively, calendar day, calendar
month and calendar year, unless otherwise expressly stated. Any amounts
expressed in dollars or preceded by "$" will refer to United States dollars. The
headings used in any document are included for convenience only and may not be
used in construing or interpreting that document.

2.TERM

This Agreement becomes effective from the Effective Date and, except as provided
under Clause 3.2, will continue in full force and effect for thirty-six
(36) months. Thereafter, this Agreement shall continue on a monthly basis until
terminated by either Party upon at least sixty (60) days notice before the end
of the Initial Term or any renewal thereof.

3.ORDERING OF SERVICES

3.1.Equant's provision of any Services to Customer and Users is contingent upon
the execution and acceptance of an Order Form for each Service.

3.2.Upon the Effective Date of this Agreement, Customer will provide Equant with
a list of Customer and User personnel who are authorized to issue Orders to
Equant. Equant may elect not to accept any Orders that are issued by
non-authorized personnel. Customer may add or delete names to/from the list,
provided Equant has been notified in writing prior to the placement of an Order.

3.3.All revisions to a previously issued and accepted Order Form must be
provided in writing and signed by duly authorized personnel. Revisions issued
verbally or electronically to Equant must be confirmed in writing within three
(3) Business Days. Customer will be charged for all costs incurred by Equant in
preparation for the initially requested Services and those incurred in revising
the Services.

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3.4.No cancellations of Orders will be permitted unless otherwise stated in this
Agreement or in writing and agreed in advance by the Parties.

3.5.New Services

(a)Customer may request that Equant provide certain services (collectively, "New
Services") that are not described in any Service Annex, provided, however, that
such a request will not require Customer to procure any such New Services from
Equant.

(b)Additionally, Customer may request pricing on a per project basis whereby
Equant will provide pricing (a "Price Quote") in accordance with the following:

(i)upon receipt of such request, Equant will investigate and advise Customer of
the feasibility and availability of the proposed New Service, and to the extent
possible, if Equant can legally provide the New Service. If so, Equant will
promptly provide Customer with a Price Quote for such New Services;

(ii)Customer will have sixty (60) days or as mutually agreed to time period to
accept or reject the Price Quote. If Customer accepts the Price Quote, the
Parties will execute an amendment to this Agreement, adding or revising the
relevant Service Annex;

(iii)upon execution of all necessary documentation by both Parties, such New
Services will be by amendment and will be deemed "Services" under this
Agreement, and Equant will commence provision thereof.

3.6.Change Control Process

Customer may request Changes to this Agreement using the relevant Order Form in
respect of any upgrades, downgrades, re-configuration or re-location of any
Services ordered. All Changes will be subject to such terms and conditions
(including financial considerations) to be agreed by the Parties.

4.INVOICES, PAYMENT AND TAXES

4.1.Commencement of Invoicing

 
4.1.1
 
Charges for all Services are set out in the schedule of Charges, or in Order
Forms. Charges will be invoiced and paid in Dollars.
 
4.1.2
 
Equant will commence invoicing of all Charges as of the date specified in the
relevant Service Annex.
 
4.1.3
 
Equant will invoice all fixed recurring Charges monthly in advance, all other
recurring Charges monthly in arrears, and all Charges for one time services on
completion of the Service, unless otherwise specified in any Service Annex.
 
4.1.4
 
Equant shall invoice Customer for its Charges, excluding claims for Losses,
within one hundred eighty (180) days after the month in which the applicable
Services and other work are rendered or the expense incurred.
 
4.1.5
 
Equant shall invoice Customer for all Tail Circuit Charges and third party
charges, excluding claims for Losses, within one (1) year after the month in
which the applicable Services and other work are rendered or the expense
incurred.

4.2.Payment

All invoices are due and payable within thirty (30) days of the date of the
invoice. Customer may dispute an invoice within one hundred eighty (180) days of
the invoice date. Failing any notification of a dispute from Customer within the
one hundred eighty (180) day period,

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Customer will be deemed to have accepted the amounts stated on the invoice. In
the event of a good faith, timely notified dispute on a part of the invoice,
Customer may withhold payment only of the disputed amount.

4.3.Taxes

The amounts listed in the schedule of Charges do not include taxes or government
imposed fees or surcharges, including VAT, sales, excise, gross receipts,
withholding taxes and universal service fund fees, which will be invoiced to
Customer in accordance with local law. Customer agrees to pay or reimburse
Equant for all such taxes, fees, and surcharges, excluding tax on Equant's,
associated companies or Sub-Contractors income. In respect of withholding tax,
Customer will pay such additional amounts as may be necessary, such that Equant
receives the amount it would have received had no withholding been imposed.

4.4.Late Payment

Failure by Customer to pay any undisputed charges in accordance with this
Agreement will entitle Equant to suspend the Service to which the non-payment
relates, having given thirty (30) days notice of its intention to do so, and
Customer having failed to remedy its payment default during that time unless
such payment is disputed in good faith pursuant to Clause 4.5 below.

The exercise of this remedy is without prejudice to Equant's other rights and
remedies under this Agreement.

4.5.Billing Disputes

In the event that Customer disputes in good faith the accuracy or validity of an
invoice provided by Equant, Customer shall notify Equant within thirty
(30) business days of the receipt of the invoice stating the reason why Customer
disputes the invoice and the amount in dispute. Customer shall pay the
undisputed portion of the Charges to Equant. Customer and Equant shall use their
commercially reasonable efforts to promptly resolve any billing dispute in
accordance with the dispute procedure set forth in Clause 12.1.

4.6.Credit Requirements

 
4.6.1.
 
From time to time, Customer may be requested to provide financial information as
Equant may reasonably request, to determine Customer's continued
creditworthiness.
 
4.6.2.
 
If Equant reasonably determines that Customer's creditworthiness is insufficient
to cover the full payment of all Charges under this Agreement, Equant may
require Customer to provide a financial guarantee in a form reasonably
acceptable to both Parties in order to continue the provision of the Services as
a condition for the continued provision of the Services.

4.7Additional Pro Forma Invoices

Equant shall include pro forma invoices along with each billing invoice to allow
Customer to identify its pass-through costs related to the use of the Services
by Customer's Affiliates and use such documentation to substantiate potential
local tax deductions. The content of such schedules and pro forma invoices will
be agreed by the Parties and shall be provided to Customer for a Charge of $250
per month. In no event shall Equant be liable to Customer or Customer's
Affiliates for any disallowance or rejection of local tax deductions by the
applicable authorities due to the provision of such pro forma invoices by Equant
or the content thereof.

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5.INTELLECTUAL PROPERTY RIGHTS

5.1.Ownership of Intellectual Property

As between the Parties, all Intellectual Property Rights in the Services are
either owned by or licensed to Equant. Nothing contained in this Agreement will
be deemed to convey any title or ownership interest in any Intellectual Property
Rights to Customer or Users, nor are any rights or licenses are granted by this
Agreement with respect to any Intellectual Property Right, except as otherwise
expressly provided in this Agreement.

5.2.Indemnification for Infringement of Intellectual Property Rights

Equant, at its expense, will indemnify, defend, and hold harmless Customer from
any action brought against Customer or any User based on a claim that any
Service or part thereof infringes any Intellectual Property Right in any country
where the Service is provided, if Customer promptly notifies Equant in writing
when such action is brought against Customer and Equant has sole control of such
defense. Equant at its sole option may settle or compromise the claim.
Notwithstanding the foregoing, Customer may elect to be represented by its own
counsel at its cost in any such settlement negotiation. In addition, Equant will
pay all fees, costs or damages finally awarded in the action or constituting a
settlement thereof, provided Customer gives Equant reasonable assistance in the
defense or settlement. In the event that an injunction, whether temporary or
permanent, is obtained against Customer prohibiting the use of a Service or any
part thereof, by reason of such infringement, Equant will:

(a)use reasonable efforts, at its own expense, to procure the right for Customer
to continue using the Service, or replace or modify the Service so that it is no
longer infringing an Intellectual Property Right; or

(b)only if Equant cannot achieve the solution referred to in Clause 5.2
(a) above, direct Customer to cease using the affected Service or to return the
infringing equipment to Equant at Equant's expense, in which case the relevant
Order will be automatically terminated.

5.3.Equant will have no obligation to defend Customer or any User or to pay
costs, damages or fees for any claim based on:

(a)use of the Service or of any part thereof other than the current unaltered
Service provided by Equant, if such infringement would have been avoided by the
use of the current unaltered Service provided by Equant; or

(b)the combination, operation or use of a Service, or of any part thereof, with
non-Equant services, equipment or software, if such infringement would have been
avoided by not combining, operating or using such Service or part thereof with
other such non-Equant service, equipment or software.

6.SOFTWARE

If required to enable Customer or Users to use a Service, Equant, will grant to
Customer and Users for the Term of this Agreement, non-exclusive and
non-transferable licenses to use Software strictly for such purpose. Customer
agrees not to produce, copy (except for the purpose of retaining a back-up
copy), alter, modify, or add to the Software or any part thereof, nor to attempt
or to allow a third party to attempt to reverse engineer, translate or convert
the Software from machine readable to human readable form, except as permitted
by applicable law.

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7.CONFIDENTIALTY AND NON-DISCLOSURE

7.1.During the Term of this Agreement and for three (3) years after its expiry,
each Party will (a) use Confidential Information of the other Party only for the
purpose of this Agreement (which may include disclosure to all necessary
sub-contractors, provided such subcontractors agree to comply with the
provisions of the Agreement); (b) only disclose the Confidential Information to
a third party with the other Party's prior written consent, except to its
professional advisors and auditors and as regards Equant, to its Affiliates
which agree to comply with this Agreement; and (c) use reasonable endeavors to
prevent the unauthorized use or disclosure of Confidential Information using at
least the same degree of care exercised to protect its own Confidential
Information.

7.2.Clause 7.1 will not apply to the disclosure of Confidential Information
(a) which is in the public domain at the time of disclosure otherwise than by
the receiving Party's breach of Clause 7.1; (b) which is rightfully received
from a third party or independently developed by the receiving Party; or (c) in
accordance with the order of a court or governmental authority, in which case
the receiving Party will give as much advance notice thereof to the disclosing
Party as is reasonably practicable and will use its reasonable efforts to limit
the extent of any such disclosure.

7.3Neither Party will make any public announcement or issue any press release
concerning this Agreement, the fact that Customer is a customer of Equant for
the Services, or the transactions contemplated hereby, without the other Party's
prior written consent, such consent not to be unreasonably withheld or delayed.

8.EXCLUSIONS AND LIMITATIONS OF LIABILITY

8.1.Neither Party will be liable for any indirect, incidental or consequential
loss or damages, howsoever arising, including loss of use or data or lost time,
revenue, profits, goodwill of clients or any business interruption of any kind
even if advised of the possibility of such damages.

8.2.Except for completing any payment obligations, which Customer shall satisfy
as soon as practicable following a Force Majeure Event that initially prevents
Customer from meeting its payment obligations in a timely manner but in any case
within thirty (30) days of the Force Majeure Event, neither Party will be liable
for any delay or for the consequences of any delay in fulfilling any of its
obligations under this Agreement if such delay is due to a Force Majeure Event.

8.3.Equant will have no liability in contract, tort or otherwise for any claim
of unauthorized access of Customer's or any Users' transmission facilities or
equipment, or for unauthorized access to, or alteration, theft or destruction of
Customer's or any Users' data files, programs, procedures or information through
accident, fraudulent means or devices, or any other method, except to the extent
caused by Equant's willful misconduct or gross negligence.

8.4.EACH PARTY'S LIABILITY FOR DIRECT DAMAGES UNDER THIS AGREEMENT, WHETHER IN
CONTRACT OR IN TORT, INCLUDING NEGLIGENCE, WILL BE LIMITED, FOR EACH EVENT OR
SERIES OF CONNECTED EVENTS, AS FOLLOWS:

(A)FOR FAILURE TO COMPLY WITH THE SERVICE LEVELS SET OUT IN THE SERVICE ANNEXES,
TO THE AMOUNT OF CREDITS SET OUT IN THE RELEVANT SLA;

(B)FOR DAMAGE OR DESTRUCTION OF TANGIBLE PROPERTY, *;

*Confidential portions omitted and filed separately with the Securities and
Exchange Commission.

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(C)FOR ALL OTHER EVENTS, * OR THE CHARGES INCURRED IN THE 12 MONTHS IMMEDIATELY
PRECEDING THE CAUSE OF ACTION UNDER THE ORDER TO WHICH THE CLAIM RELATES,
WHICHEVER IS THE GREATER.

THE EXCLUSIONS AND LIMITATIONS OF LIABILITY CONTAINED IN CLAUSE 8.4 DO NOT APPLY
TO CLAUSES 5 AND 7 OR TO CLAIMS FOR DEATH OR PERSONAL INJURY.

8.5.Limitation of Warranties

 
8.5.1
 
EXCEPT FOR ANY EXPRESS WARRANTY SET OUT IN THE SLAS CONTAINED IN THE SERVICE
ANNEXES OR ELSEWHERE IN THIS AGREEMENT, THE SERVICES ARE PROVIDED ON AN "AS IS"
BASIS, AND CUSTOMER'S AND USERS' USE OF THE SERVICES IS AT THEIR OWN RISK.
EQUANT DOES NOT MAKE, AND HEREBY DISCLAIMS, ANY AND ALL OTHER EXPRESS AND/OR
IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT AND TITLE,
AND ANY WARRANTIES ARISING FROM A COURSE OF DEALING, USAGE, OR TRADE PRACTICE.
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, EQUANT DOES NOT WARRANT THAT
THE SERVICES WILL BE UNINTERRUPTED, ERROR-FREE, OR SECURE.
 
8.5.2
 
The obligation of Equant and the rights and remedies of Customer set out in this
Agreement are exclusive and in substitution for all other remedies, obligations
and liabilities of Equant. The remedies of the Parties with respect to any
matter under this Agreement will be limited to the remedies set out herein;
provided, that neither Party will receive duplicative recoveries.

9.TERMINATION

9.1.Immediate Termination

Either Party may terminate this Agreement with immediate effect, by giving
notice to the other Party, if:

 
9.1.1.
 
the other Party commits any material breach of this Agreement, and does not
remedy the breach (if it is capable of remedy) within thirty (30) days of notice
of the breach being given by the non-defaulting Party. Failure to meet an SLA
will not be deemed a material breach for the purpose of this Clause 9.1.1, and
any right of termination will be governed by the terms of the SLA set out in the
relevant Service Annex;
 
9.1.2.
 
a court order is made, or an effective resolution is passed for the dissolution
or winding up of the other Party except for the purposes of an amalgamation,
merger or restructuring;
 
9.1.3.
 
a lien holder takes possession or a receiver is appointed over the whole or a
material part of the undertakings or assets of the other Party;
 
9.1.4.
 
the other Party becomes insolvent or makes any special arrangements or any
special assignment for the benefit of its creditors, or is the subject of a
voluntary or involuntary filing under the insolvency or bankruptcy laws of any
jurisdiction;
 
9.1.5.
 
all Orders have been terminated pursuant to Clause 9.2.

*Confidential portions omitted and filed separately with the Securities and
Exchange Commission.

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9.2.Termination on Notice

Either Party may terminate any Order with immediate effect by giving notice to
the other Party:

 
9.2.1.
 
if the other Party fails to make any payment relating to that Order when due and
does not remedy this within thirty (30) days following notice thereof, unless
such payment is in dispute in accordance with Clause 4.5;
 
9.2.2.
 
as permitted in the relevant SLA;
 
9.2.3.
 
if a Force Majeure Event affecting the provision of Services under that Order
continues for more than thirty (30) consecutive days.

9.3.Effect of Termination

 
9.3.1.
 
On termination of this Agreement, all Orders will immediately be terminated. The
expiration or termination, for any reason, of this Agreement or of any Order,
will not affect (a) the rights of either Party against the other which have
accrued on or prior to the termination; nor (b) any provision expressed to
survive the termination.
 
9.3.2.
 
On termination of this Agreement for whatever reason, each Party will
immediately return to the other Party all property of whatever kind and nature
provided under this Agreement and belonging to the other Party, including
Confidential Information.
 
9.3.3.
 
Subject to Clause 6.2 of Annex 1-A and satisfaction of the Service Commitments
in Annex 1-F,Customer may terminate service at any Location at any time provided
that (i) the Service has been connected at the applicable Location for a minimum
of twelve (12) months, and (ii) Customer continues to meet the agreed to
Services Commitment set forth in Annex 1-F for the remainder of the Term.
Notwithstanding the foregoing, the twelve (12) month minimum connection
requirement stated in subsection (i) above shall not apply to the following
Locations as of the Effective Date:

Carpinteria, CA USA
Mt. Laurel, NJ
Alfortville, France
Annecy, France
Bangkok, Thailand
Mexico City, Mexico
Adelaide, Australia
Grand Rapids, Michigan USA
Durban, South Africa
Chicago, Illinois USA
Istanbul, Turkey
Johannesburg, South Africa
Limerick, Ireland
Milan, Italy
Mumbai, India
Sydney, Australia
Osaka, Japan
Powell, TN USA
Rancho Pales Verdes, CA USA
San Mateo, CA USA
Sao Paulo, Brazil
Singapore

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Tokyo, Japan
Wanchai, Hong Kong
Dudley, UK
Willich, Germany
Wroclaw, Poland

The following Locations will satisfy the twelve (12) month minimum connection
requirement stated in subsection (i) above on the dates set forth below:

    Turin, Italy   December 1, 2002     Melbourne, Australia   June 1, 2003    
Brisbane, Australia   November 1, 2002     Milton, Australia   November 1, 2002
    Schiphol, Netherlands   June 1, 2003

10.ASSIGNMENT

 
10.1.
 
Either Party may at any time assign all or part of its rights or obligations
under this Agreement to any of its Affiliates, provided that (a) the assignee is
not a direct competitor of the other Party; or (b) the assignment would not
cause the other Party to incur materially increased costs in connection with the
provision of the Services or this Agreement.
 
10.2.
 
Subject to Clause 10.1 and 13.4, neither Party may assign, or otherwise dispose
of its rights or obligations under this Agreement, or any part of this
Agreement, without the written consent of the other Party, such consent not to
be unreasonably withheld or delayed.

11.GOVERNING LAW

This Agreement and all matters regarding the interpretation or enforcement
hereof, will be governed exclusively by the laws of the State of New York,
without regard to its conflict of laws provisions.

12.DISPUTE RESOLUTION

 
12.1
 
Informal Dispute Resolution
 
 
 
Equant and Customer will attempt in good faith to resolve any dispute arising
out of or relating to this Agreement promptly by negotiation between executives
who have authority to settle the controversy and who are at a higher level of
management than the persons with direct responsibility for administration of
this Agreement. Either party may give the other party written notice of any
dispute not resolved in the normal course of business. Within ten (10) days
after delivery of the notice, the receiving party will submit to the other a
written response. The notice and the response will include (a) a statement of
each party's position and a summary of arguments supporting that position, and
(b) the name and title of the executive who will represent that party and of any
other person who will accompany that executive. Within twenty (20) days after
delivery of the disputing party's notice, the executives of both parties will
meet at a mutually acceptable time and place, and thereafter as often as they
reasonably deem necessary to attempt to resolve the dispute. If the executives
are unable to reach resolution within forty-five (45) days after delivery of the
disputing party's notice, then the parties may proceed to mediation or
arbitration as set forth below. All reasonable requests for information made by
one party to the other will be honored.
 
 
 
 

10

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1.1.
 
Arbitration. All disputes, controversies or differences which may arise between
the Parties, out of, or in relation to or in connection with this Agreement, or
for the breach of it, will be initially by internal dispute resolution and then,
if necessary, exclusively by arbitration before a single arbitrator in New York
City, New York, in accordance with the Commercial Arbitration Rules of the
American Arbitration Association. Each Party irrevocably consents to personal
jurisdiction and to ex parte action should any Party refuse to participate in
such proceedings. The arbitrator's award will be final and binding on all
Parties and judgment on the award may be entered and the award enforced in any
court having jurisdiction thereof.

13.GENERAL

 
13.1.
 
Notices. Any and all notices required or permitted to be given under this
Agreement will be in writing and will be sufficiently given when delivered
(i) by hand, (ii) by registered mail, postage prepaid, return receipt requested,
(iii) by facsimile transmission, sent to the addresses of the Parties appearing
on page 3 of this Agreement or such other address as may be notified by a Party
to the other. Except in the case of delivery by hand, and save for evidence to
the contrary, notices will be deemed to have been given on the day on which such
communication ought to have been delivered in due course of postal or facsimile
transmission.
 
13.2.
 
Status of the Parties. This Agreement is not intended to create, nor will it be
construed to be, a joint venture, association, partnership, franchise, or other
form of business relationship. Neither Party will have, nor hold itself out as
having, any right, power or authority to assume, create, or incur any expenses,
liability, or obligation on behalf of the other Party, except as expressly
provided in this Agreement.
 
13.3.
 
Third Party Beneficiaries. Nothing in this Agreement will be construed as
conferring any rights or benefits on any person or legal entity (including Users
other than Customer) who or which is not a party to this Agreement.
 
13.4.
 
Sub-Contractors. Equant will be entitled to sub-contract any of its obligations
to a third party (each, a "Sub-Contractor"), except that it will not
sub-contract any of its obligations to a third party which may be reasonably
considered as a competitor of Customer without Customer prior written consent.
Equant will be responsible for the acts and omission of any Sub-Contractor.
 
13.5.
 
Invalidity. Should any provision of this Agreement be declared invalid for any
reason, such decision will not affect the validity of any remaining provisions
which will remain in force and effect as if this Agreement had been executed
with the invalid provision eliminated. In any such event, the Parties will work
together and negotiate in good faith to replace the invalid provision with a
provision of equivalent economic effect.
 
13.6.
 
No Waivers. The failure of either Party to require the performance of any of the
terms of this Agreement or the waiver by either Party of any default under this
Agreement will not prevent a subsequent enforcement of such term, nor be deemed
a waiver of any subsequent breach.
 
13.7.
 
Modifications of the Agreement. This Agreement may be modified, supplemented, or
amended upon signed written agreement of the Parties.
 
13.8.
 
Order of Precedence In the event of any conflict or inconsistency between the
provisions of (1) the body of this Agreement; (2) the Service Annexes; and
(3) Order Forms, the following order of precedence will apply:
 
1.2.
 
the body of this Agreement;
 
 
 
 

11

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1.3.
 
the Service Annexes;
 
1.4.
 
the Order Forms.
 
 
 
This order of precedence will apply unless otherwise expressly set out in any
Service Annex.
 
13.9.
 
Entire Agreement. This Agreement represents the entire agreement of the Parties
with respect to its subject matter and supersedes all prior agreements,
negotiations, representations (innocent or negligent), and proposals, written or
oral, relating to its subject matter including, without limitation, the Managed
Data Network Services Agreement Number MDNS/US/QAD/07/99/02 executed between the
Parties. Neither Party will be bound by or liable to the other Party for any
representation, promise, or inducement made by any agent or person in the other
Party's employ which is not expressly stated in this Agreement.
 
13.10.
 
Compliance with Laws. The Parties will comply in all material respects with all
telecommunications, data protection and other laws relating to the subject
matter of this Agreement.
 
13.11.
 
Non-Solicitation. Each Party acknowledges the importance of the other Party's
employees to its successful operation, and agrees not to solicit, for the
purposes of making an offer of employment any person employed by the other Party
(a) at any time during the term of this Agreement (including any extensions
hereof); and (b) for a period of 12 months following the termination of this
Agreement, without the prior written consent of the other Party. The Parties
expressly acknowledge that the remedy at law for any breach by it of this
covenant will be inadequate and therefore, in the event of any threatened or
actual breach of such covenant, the breaching Party will be entitled to
injunctive or other equitable relief in addition to any other remedies that it
may have at law or in equity.
 
13.12.
 
Independent Counsel. This Agreement has been negotiated at arms length and
jointly prepared by the Parties and their respective counsel of choice.
 
13.13.
 
Counterparts. This Agreement may be signed in any number of counterparts each of
which, when signed, will be an original, but all the counterparts together will
constitute one and the same instrument.
 
13.14.
 
Force Majeure. Neither party shall be held responsible for any delay or failure
in performance to the extent such delay or failure is caused by fires, floods,
strikes, lockouts, epidemics, accidents, shortages, act of any governmental
authority, or other causes beyond the reasonable control and without the fault
or negligence of the delayed or non performing party or its subcontractors. If
any such conditions occur, the party delayed or unable to perform shall give
immediate notice to the other party stating the nature of the condition and any
action being taken to avoid or minimize its effect.
 
13.15.
 
Survival. The provisions of this Agreement that, by their very nature, are
intended to survive this Agreement, including without limitation, Clauses 7, 8,
and 9, shall survive the termination or expiration of this Agreement.

        IN WITNESS WHEREOF, the Parties have caused this Agreement to be
executed by their duly authorized representatives as of the dates set out below.

FOR AND ON BEHALF OF:
 
FOR AND ON BEHALF OF:
EQUANT INC.
 
QAD INC.
BY:
 
/s/  BRUCE W. SMITH       

--------------------------------------------------------------------------------

 
BY:
 
/s/  VINCE NIEDZIELSKI      

--------------------------------------------------------------------------------

NAME:   Bruce W. Smith

--------------------------------------------------------------------------------

  NAME:   Vince Niedzielski

--------------------------------------------------------------------------------

TITLE:   Head of North America

--------------------------------------------------------------------------------

  TITLE:   Executive VP, R&D

--------------------------------------------------------------------------------

DATE:   7/22/02

--------------------------------------------------------------------------------

  DATE:   6/7/02

--------------------------------------------------------------------------------

             

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SERVICE ANNEX 1—NETWORK SERVICES

ANNEX 1-A—ADDITIONAL TERMS AND CONDITIONS FOR NETWORK SERVICES

        The terms set forth below may conflict with terms and conditions set
forth in another Service Annex. Such conflicting terms are not inadvertent;
rather, they are due to the nature of these Specific Conditions. To the extent
that there is a conflict, the terms provided in these Specific Conditions will
prevail regarding delivery of the Services described in this Service Annex

1.Definitions
All capitalized terms used will have the meanings set out elsewhere in this
Agreement.

2.Provision of Network Service And Support Services—Equant's Obligations
2.1.Equant will provide the Services ordered by Customer as of the Date of
Acceptance.

2.2.Equant will cooperate with and provide all reasonable assistance to Customer
in its performance of this Agreement including the timely provision of all
information necessary for Customer to utilize the Services and effect any
Changes.

2.3.The Services will conform to the Service Levels set out in the relevant SLAs
attached to this Agreement. If any Service fails to so conform, Customer will be
entitled to the remedies set out in the relevant SLA attached to this Agreement.

2.4.Equant will maintain during this Agreement, security procedures (as the same
may be revised from time to time so as to maintain security), to protect
Customer's computer stored data transmitted over the Network from unauthorized
access and disclosure other than as permitted by this Agreement or to anybody
having statutory authority to require Equant to make disclosures. The security
procedures will at all times be consistent with the Code of Practice for
Information Security Management.

2.5.Equant will not inspect Customer data transmitted over the network beyond
OSI Layer 4.

2.6.Equant will not provide service via a NNI or third party Frame Relay
provider without prior approval.

2.7.Technology upgrades

Equant warrants that it will keep up to date in technology changes in the
telecommunications industry and will offer all new technologies to Customer when
commercially available. In the event that Customer is able to demonstrate that
it can obtain an enhanced or upgraded service as an alternative to the Service
at all the Locations listed in the table following this Clause 2.7 from at least
one (1) other single-source service provider at performance levels and charges
equivalent to or better than the Service Levels and Charges, then Equant shall
have four (4) months in which to offer such enhanced or upgraded service to
Customer at competitive charges and performance levels, failing which Customer's
sole remedy shall be the right to terminate this Agreement upon thirty (30) days
notice subject to payment of the Charges set forth in Clauses 6.2.2 and 6.2.3 of
this Annex 1-A.

13

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Table to Annex 1-A

Technology Upgrade Locations

Carpinteria, CA USA
Mt. Laurel, NJ
Alfortville, France
Annecy, France
Mexico City, Mexico
Adelaide, Australia
Grand Rapids, Michigan USA
Chicago, Illinois USA
Limerick, Ireland
Melbourne, Australia
Milan, Italy
Milton, Australia
Sydney, Australia
Nieuwegein (Schiphol) Netherlands
Osaka, Japan
Powell, TN USA
Rancho Pales Verdes, CA USA
San Mateo, CA USA
Sao Paulo, Brazil
Singapore
Tokyo, Japan
Turin, Italy
Wanchai, Hong Kong
Dudley, UK
Willich, Germany

3.Use of Network Services—Customer's Obligations

3.1.Customer will accept the Services on each mutually agreed upon Date of
Acceptance and thereafter pay the Charges for all Services in accordance with
this Agreement.

3.2.Customer will cooperate with and provide all reasonable assistance to Equant
in its performance of this Agreement including the timely provision of all
information necessary for Equant to install the Services and effect any Changes.

3.3.Customer will not knowingly use the Services to transmit, distribute,
disseminate, publish, or store any material that:

(a)is in violation of any applicable local, national, or international law or
regulation;

(b)is defamatory, abusive, obscene, indecent, or harassing; or that threatens or
encourages bodily harm, destruction of property, or infringement of the lawful
rights of any party;

(c)violates the privacy of any party as protected by applicable local, national,
or international law or regulation; or

(d)contains software viruses, trojan horses, or any computer code, files, or
programs designed to disrupt, destroy, invade, gain unauthorized access to,
corrupt, observe, or modify without authorization, data, software, computing or
network devices, or telecommunications equipment.

14

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3.4Customer will not knowingly use the Services to access any computer, network,
or data without authorization or in a manner which exceeds authorization
including, any attempt to:

(a)retrieve, alter, or destroy data;

(b)probe, scan or test the vulnerability of a system or network; or

(c)breach or defeat system or network security, authentication, authorization,
confidentiality, intrusion detection, monitoring, or other security measures.

3.5Customer will indemnify and hold harmless Equant and its Affiliates from and
against any and all Losses caused by or arising from any breach by Customer or
Users of Clauses 4.3 and 3.4.

3.6Customer will not interconnect the Network, or cause or allow the Network to
be interconnected via an NNI (Network to Network Interface—on layer 1 and 2 of
the OSI Model), with any other network unless Equant has given Customer its
prior approval. Any breach of this provision will be a material breach of this
Agreement

3.7Customer will ensure that all Users will comply at all times with the
obligations of Customer under this Agreement.

3.8Except as otherwise authorized under this Agreement, Customer will not resell
or otherwise make available the Services to any third party. Any breach of this
provision will be a material breach of this Agreement.

4.CPE

4.1The Services may include CPE. Equant warrants that it has the right to
provide the CPE to Customer and that Customer and its Affiliates will have the
right to use the CPE for the duration of this Agreement.

4.2Equant will connect the CPE at the Locations on dates to be agreed by the
Parties. If a connection requires the removal or disconnection of any existing
equipment of Customer, Customer will permit, or obtain all necessary consents
for, the removal or disconnection and will give Equant all reasonable assistance
to enable the work to be carried out.

4.3The CPE will at all times remain the sole and exclusive property of Equant or
its Sub-Contractors and Customer will obtain no property rights or interest in
the CPE but will have the right to quiet possession and the right to use the CPE
in accordance with this Agreement.

4.4Customer will have the following obligations with respect to the CPE:

 
4.4.1
 
not to sell, assign, sub-let, pledge or part with possession or control of, or
otherwise deal with the CPE or any interest in it;
 
4.4.2
 
not to change, remove or obscure any labels, plates, insignia, lettering or
other markings which are on the CPE at the time of its connection or which may
afterwards be placed on the CPE by Equant;
 
4.4.3
 
to keep the CPE free from distress, execution or any other legal process
provided Equant shall have taken such action itself as shall be reasonably
necessary or appropriate to protect against claims of liens;
 
4.4.4
 
not to move the CPE from the Location to which it was delivered and connected
without Equant's prior consent, which consent shall not be unreasonably be
withheld;
 
4.4.5
 
not to use the CPE or permit the same to be used contrary to any law or any
regulation for the time being in force;
 
 
 
 

15

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4.4.6
 
to ensure that proper environmental conditions as recommended in writing by
Equant are maintained for the CPE and that the exterior surfaces are kept clean
and in good condition;
 
4.4.7
 
not make any modifications to the CPE; without Equant's prior consent;
 
4.4.8
 
provide Equant with all reasonably required access to the Locations.

4.5Upon termination of this Agreement, Customer will surrender possession of the
CPE in good order, repair and condition, to Equant, reasonable wear and tear
excepted, provided Equant covenants to remove such CPE in a manner that does not
cause damage to Customer property or premises.

4.6Subject to Clause 4.4 of this Service Annex, Equant will ensure that the CPE
is in good working order for the duration of this Agreement. If a fault in a
Service occurs which has been caused by a failure in the CPE, Equant will repair
the fault as soon as possible following notification of the fault by Customer or
detection of the fault by Equant, whichever first occurs. If a visit to a
Location is required, Equant will comply with the relevant Service Level
described in the SLA.

4.7Any visits to a Location or repairs to CPE made necessary by: (a) damage to
the CPE not caused by Equant; (b) interventions other than normal interventions
carried out by non-Equant personnel; (c) modifications to the CPE which have not
been approved by Equant or have been carried out by personnel not approved by
Equant; (d) improper treatment of the CPE by Customer; (e) failure by Customer
to meet the CPE manufacturer's specifications as advised by Equant to Customer
on environmental conditions; or (f) Customer's negligence, will entitle Equant
to make an additional charge for the Services at the relevant Location, such
additional charge to be equal to the actual and reasonable cost to Equant of
restoring the Services and repairing or replacing the CPE.

5Connection of Services

5.1Equant will use reasonable efforts to connect Services on the Target Dates,
or if not so stated on dates agreed by the Parties and in any event as soon as
possible after the date the Tail Circuits are made available by the TOs. Equant
will use all reasonable efforts to ensure that Tail Circuits are ordered and
administered by Equant so as to be made available in accordance with TOs' usual
lead times. However, Equant will have no responsibility, nor liability for
delays caused by Customer Users, TOs or any event of Force Majeure. In the event
of any such delays, Equant will use all reasonable efforts to provide the
Services at the earliest opportunity. Equant reserves the right to connect an
interim service of an equivalent functionality and performance should such
delays occur.

5.2Customer will use all reasonable efforts to accept the Services on agreed
connection dates. Equant reserves the right to commence the Charges for any
delayed Service due to Customer's breach of this provision, and in addition no
such delay will affect Equant's right to receive reimbursement from Customer for
all TO and other third party vendor charges in respect of Tail Circuits and
communications equipment incurred from the date of any contract between Equant
and any TO or other third party vendor.

5.3Customer also understands that should Equant, its agents or Sub-Contractors
carry out a visit agreed to in advance by Customer to a Location in order to
connect a Service, and then be unable to do so as a result of any act or
omission by Customer or any User, Equant reserves the right to charge Customer
for such visit at its then current manpower rates for such time and its
reasonable travel and out of pocket expenses.

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6Cancellation of Services

6.1Customer may not cancel or disconnect any Service during the Term of this
Agreement unless:

 
6.1.1
 
Customer is entitled to terminate this Agreement, or to cancel a Service
pursuant to its rights under any SLA;
 
6.1.2
 
Customer is unable to conduct its business at any Location due to Force Majeure.
Customer may only invoke this provision after 30 continuous days of Force
Majeure;
 
6.1.3
 
Customer is unable to conduct its business at a Location due to insolvency,
cessation of business or dissolution of an entity within the Customer's
operation. In such instance Customer shall advise Equant in writing of its
intent to cancel such Location, with the reasons for such cancellation.
 
6.1.4
 
Customer substitutes any Location or PVC with a new Location or PVC having
equivalent monthly recurring Charges that are substantially equivalent to the
monthly recurring Charges of the Location or PVC being disconnected, provided
Equant is able to connect the Service at the new Location or PVC. Equant shall
be entitled to charge a connection and project management fee for the new
Location or PVC, as agreed by the Parties.

6.2Any cancellation or disconnection of a Service authorized by Equant will be
conditional on Customer providing the following:

 
6.2.1
 
at least sixty (60) days prior notice and signature on and return of an Equant
Disconnect Form to Equant;
 
6.2.2
 
for CPE based services, payments of (i) an early disconnection charge of $1500;
and (ii) the applicable router disconnection fee indicated in the table
following this Clause 6.2; and
 
6.2.3
 
any contingent Tail Circuit charges including any cancellation penalties; Equant
agrees to mitigate any such charges by terminating any Tail Circuit leases with
the TO as soon as practicable following notification of the cancellation by
Customer. In most cases, cancellation penalties imposed by TOs will not exceed
12 month's charges for the disconnected Tail Circuit.

Location

--------------------------------------------------------------------------------

  Router Disconnection Fee

--------------------------------------------------------------------------------

        Netherlands   $ 1,275 USA   $ 1,050 Hong Kong   $ 1,500 Australia   $
1,500

6.3Payment of the charges set out in Clauses 6.2.2 and 6.2.3 above are in
addition to any early termination damages that may accrue elsewhere in this
Agreement.

7Reservation of Rights

7.1Equant reserves the right to make operational changes to the Services, if the
changes do not adversely affect the Services provided to Customer nor cause
Customer to incur increased charges, and Equant will provide advance notice of
such operational changes whenever practicable.

7.2Equant will be entitled to refuse, suspend, or discontinue the provision of
Services to Customer in any Location by providing to Customer prior written
notice as is appropriate under the circumstances, if Equant, in its reasonable
discretion, determines that the provision

17

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of any Service will jeopardize Equant's ability or authority to provide Equant
services in any jurisdiction. In the event of such refusal, suspension, or
discontinuation of Services, the Parties will consult with each other in an
attempt to find an alternative solution, if any that would allow the provision
of Services to that Location. The amount of any Shortfall as set forth in
Clause 1 of Annex 1-F shall be Services commitment will be reduced for the
Customer as appropriate for Services discontinued under this Clause 7.2 with no
alternative solution provided by Equant.

8.Benchmarking

8.1Overview

 
8.1.1
 
This Clause 8 of Service Annex 1 defines the process for benchmarking the
Services.
 
8.1.2
 
Benchmarking will be carried out to provide an independent view of the Median
Charge for Comparative Services.
 
8.1.3
 
The benchmarking shall occur during the eighteenth (18th) month of Term of this
Agreement or as agreed to by the Parties.

8.2Definitions

In this Clause 8:

"Comparative Services" means the services provided by at least two
(2) reasonably comparable global service suppliers selected by the Independent
Adviser that are reasonably comparable to the Services being benchmarked in
respect of (a) geographic availability; (b) service levels; and
(c) functionality.

"Regions" means (1) North, South and Central America, (2) Europe, (3) the
Asia/Pacific region and (4) the rest of the world.

"Independent Adviser" means Gartner Group, GIGA, Ovum or such other independent
third party adviser agreed in writing by the parties from time to time.

"Median Charge" means, in respect of Comparative Services, the median market
price for such services identified by the Independent Adviser.

8.3Selection of the Independent Adviser

 
8.3.1
 
The Parties will agree to the selection of the Independent Adviser. The
Independent Adviser chosen will be responsible for all subsequent benchmarking
of the Services, unless the Parties agree otherwise.
 
8.3.2
 
The Independent Adviser will be jointly instructed by the Parties and, subject
to Clause 8.4.7 below, the Parties will share the Independent Advisor's costs
equally. The instruction to the Independent Adviser will specify the number of
Comparative Services to be considered in the benchmarking process. There will be
a single brief for the Independent Adviser, produced jointly by the Parties,
except where there are differences between the Parties' requirements for that
brief. In these circumstances, there will be a single joint brief, together with
a document from each Party, in which each explains their respective differences.
The Independent Adviser will decide in his sole discretion how to resolve any
such differing requirements.

18

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8.4Process

 
8.4.1
 
Benchmarking may be invoked for any or all Services then provided to Customer by
Equant, in any or all Regions. Where the Services to be benchmarked are provided
across a Region, the benchmarking will be conducted against the whole of such
Region and not against any individual country or countries.
 
8.4.2
 
The Independent Adviser will identify the Comparative Services against which the
Services are to be benchmarked.
 
8.4.3
 
Where in his sole judgment it is appropriate, the Independent Adviser will
adjust the applicable charges for Comparative Services to take account of any
material differences between the Comparative Services and the Services then
provided by Equant to Customer, including differences in: (a) geographic
availability; (b) service levels; (c) functionality; (d) service configuration
and capacities; (e) service management and reporting; (f) security;
(g) aggregate expenditure and volumes; (h) minimum commitment and available
discounts; (i) contract term; and (j) the level of remedies provided under any
service level agreement.
 
8.4.4
 
The applicable charges derived by the Independent Adviser for each Comparative
Service, including any adjustment made pursuant to Clause 8.4.3 above, will then
be aggregated, and the relevant Median Charge will be calculated. The
Independent Adviser will then compare the Median Charge with the charges then
payable by Customer to Equant for the relevant Service (including any relevant
applicable discounts). The comparison will take full account of any elements of
the charges that the Independent Adviser deems appropriate in his sole
discretion (e.g. in addition to comparing fixed recurring service charges, the
Independent Adviser may include connection charges in the relevant comparison).
 
8.4.5
 
For Services that comprise a number of options, e.g., CIR capacity options, the
Independent Adviser may choose to benchmark a representative sample of what he
considers to be the most frequently used options. Either party may object, on
reasonable grounds, to the Independent Adviser's chosen options and the parties
will resolve any such objection and agree to the relevant sample to apply prior
to the Independent Auditor proceeding with the process. Any percentage change in
charges resulting from the benchmarking of the relevant sample will then be
applied to all options for that Service and aggregated to derive a new Median
Charge. Where there are a range of available prices within a Service, the
Independent Advisor will use his sole discretion to determine the Median Charge
for that Service in order to produce a fair and reasonable balance between the
various prices.
 
8.4.6
 
Where the Median Charges for a Service are less than the charges then charged by
Equant to Customer for such Service, Customer will have the right to request
Equant to reduce its Charges to match the relevant Median Charges to take effect
from the first (1st) of the month following completion of the process ("Date of
Effect").
 
8.4.7
 
If Equant does not reduce its Charges in accordance with Clause 8.4.6 above,
Customer may, within forty-five (45) days of the Date of Effect:

 
8.4.7.1
 
terminate the Services in the relevant Region under this Agreement, on thirty
(30) days prior written notice to Equant; or
 
 
 
 

19

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8.4.7.2
 
terminate this Agreement on thirty (30) days prior written notice to Equant,
where the Services that may be terminated pursuant to Clause 8.4.7.1 above
constitute at least forty percent (40%) (by volume of charges) of all Services
then being provided to Customer by Equant under this Agreement;
 
8.4.7.3
 
in both such events, Equant shall be responsible for full payment of the
Independent Advisor's costs for the relevant benchmarking exercise.

 
8.4.8
 
Any dispute between the parties relating to this Clause 8 which is not resolved
within ten (10) business days of notice of the dispute by either party shall be
escalated by both parties to their respective senior management. If the dispute
is not settled by senior management within ten (10) business days of escalation,
either party shall be entitled to initiate the dispute resolution process
pursuant to Clause 12 of this Agreement.

20

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Annex 1-B—Network Services Support

1.Help Desk

Access to help desks at certain locations notified by Equant, via which Customer
and Users may obtain technical advice and guidance on the operation and use of
the Service. Customer understands that the location of the help desks is subject
to reasonable change at any time. These help desks will be available 24 hours a
day, 7 days a week, to answer all Service related queries to Customer's and
Users designated personnel. Equant will use its reasonable efforts to respond
promptly on any query that is related to the Services.

2.Global Support 2.1.Equant's multi-tiered support structure is available to
serve the needs of customers in more than 200 countries. All support personnel
can speak English and are either indigenous to the local country or are fluent
in one or more of nearly 40 local languages.

2.2.Equant takes responsibility for managing network access between all sites,
even where the network path crosses many national boundaries. Each service
center is equipped with comprehensive trouble and fault diagnosis hardware.

2.3.Equant support is organized as a pyramid based on 3 levels of support: core
network support, customer service support, and on-site support. These support
levels and the key functions of the hierarchy are illustrated below:

         GRAPHIC [g247135.jpg]

3.Support Levels

3.1.Core Network Support

Ultimate responsibility for network management is assigned to 3 network
management centers in Paris, Tulsa, and Singapore. These 3 centers, referred to
as Global Network Management Centers (GNMCs), use a follow-the-sun approach to
provide 24 hour central control and visibility over the core backbone network,
7 days a week, three hundred sixty-five (365) days a year. The 3 GNMCs maintain
the integrity of the core backbone and also serve as a final escalation point
for the most complex of customer network issues.

3.2.Customer Service Support

 
3.2.1.
 
Equant's 5 Global Customer Service Centers (GCSCs) provide the first level of
customer support on a twenty-four hour/seven day basis. The 5 GCSCs, located in
Atlanta, Cairo, London, Rio de Janeiro and Sydney, each have global visibility
of the entire network and maintain full ownership of all faults reported. The
GCSCs are supported by more than 20 satellite Customer Service Centers, which
handle in-country fault management activities for countries with regulatory,
technical or linguistic restrictions.
 
3.2.2.
 
Located within the GCSCs are the Proactive Surveillance Units, which provide
constant monitoring of selected customers that have subscribed to Equant's
managed router solutions.
 
 
 
 

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3.2.3.
 
The GCSCs are further supported by Equant's Internetwork Operation Centers,
which provide local LAN Access, Intranet Connect, and VPN support for customers
and operations; the Applications Referral Centers, which deliver support of core
network application-based problems; and Equant's Centers of Excellence, which
provide the highest level of technical expertise in resolving service-specific
problems.

3.3.On-site Support

At the local level, Equant's entire organization is supported by multiple Fault
Repair Units (FRUs), which are part of Regional Service Operations. The FRUs
maintain local presence in over 280 cities in more than 150 countries. The FRUs
facilitate the repair and service of local nodes, connections and customer
equipment as well as manage the relationship with local TO service providers.

3.4.Fault Management

 
3.4.1.
 
Fault Reporting
 
(a)
 
Upon the Customer's detection or notification of a fault, the Customer will open
a trouble ticket with the GCSC. The GCSC staff will retrieve the Customer site
file from the trouble ticket database, confirm the user code and address, and
initiate the appropriate action.
 
(b)
 
The GCSC will commence standard procedures to properly address all problems and
restore the Service within the shortest possible period of time.
 
(c)
 
All GCSCs utilize Equant's single global trouble ticket system to log and track
reported faults. This system provides global visibility of all faults and
associated activities to all network operations and support staff. In order to
assist Customer in its fault monitoring and management, Equant offers Customer
the optional Web Vision, TT Vision and i Vision customer service tools at no
charge, so Customer can obtain real-time access to this system to check the
status and add comments to the ticket.
 
3.4.2.
 
Fault Diagnosis
 
 
 
The GCSC personnel will initiate a step-by-step fault diagnosis process that
will allow them to diagnose the problem and take the appropriate corrective
action. This may include dispatching a technician, or referring the fault to the
local TO or one of our internal Centers of Excellence. In cases where the
problem is identified to be at the remote end, the trouble ticket will be
referred to the appropriate local customer service center while maintaining
trouble ticket ownership to resolution.
 
3.4.3.
 
TO Problems
 
 
 
If the problem is identified as within the local TO's responsibility, GCSC
personnel will open a trouble ticket and route the problem directly to the local
TO supplier. The trouble ticket will remain open until the problem has been
resolved and the user confirms that the service has been restored back to
normal. During this time, ownership of the trouble ticket stays with the Equant
GCSC and they will keep Customer apprised of the status and escalate as
required.
 
 
 
 

22

--------------------------------------------------------------------------------

 
3.4.4.
 
Equipment Problem
 
 
 
If the problem is diagnosed as caused by an Equant-supplied equipment component,
the trouble ticket will be routed to the local field service unit, who will
arrange to dispatch a technician under the terms of Customer's maintenance
agreement. Once the fault has been resolved, the field support engineer will
contact the local customer service center and request confirmation that service
has been restored with the local user and close the trouble ticket.
 
3.4.5.
 
Network Problems
 
 
 
Any problem identified as a fault in the Equant network will be routed to the
Network Operations staff and/or the appropriate Center of Excellence. After the
fault has been cleared, it will be referred back to the GCSC, which will check
with the local site prior to closing the trouble ticket.
 
3.4.6.
 
Closing Trouble Tickets
 
 
 
Once the fault has been reported as resolved it will be placed in "cleared"
status. The GCSC staff will then contact Customer's contact and request
confirmation that the fault is in fact resolved. Only after the GCSC staff has
received this confirmation can the trouble ticket be closed.
 
3.4.7.
 
Escalation Process
 
 
 
If the trouble ticket is not immediately resolved, the trouble ticket is
automatically escalated using a predefined time scale. The Equant escalation
process is designed to provide a high level of management visibility within
Network Operations to ensure every possible action is being taken to resolve the
fault.
 
 
 
The following is a general guideline for an automated management notification:

Level

--------------------------------------------------------------------------------

  Elapsed Time

--------------------------------------------------------------------------------

  Function

--------------------------------------------------------------------------------

1   2 hours   Unit Supervisor/COM (if assigned)
2
 
4 hours
 
CSC Manager
3
 
6 hours
 
Regional CSC Director
4
 
24 hours
 
GCSC Director
5
 
48 hours
 
VP of Global Customer Service

Managerial escalation should occur anytime it is felt that involvement of the
next level manager is required to resolve a problem. Managerial escalation times
are based on the judgment of the problem owner.

3.5.Tail Circuit Management

Tail Circuit management services for all Tail Circuits, includes:

•ordering and management of the connection of Tail Circuits, modems and other
communications equipment from the relevant TOs or other third party vendors as
applicable; in the event Equant is unable to order Tail Circuits due to
regulatory impediment, Customer agrees to order them in its own name;

•testing and acceptance of Tail Circuits, modems and other communications
equipment;

•notification of Tail Circuit faults both to Customer and the relevant TO upon
Equant becoming aware of the faults and the coordination and expediting of
Service restoration;

23

--------------------------------------------------------------------------------

•payment to TOs and other third party vendors in local currency on Customer's
behalf, where applicable. However, this service does not affect Customer's
liability with respect to such Tail Circuits, modems or other communications
equipment and all sums paid by Equant to TOs or other third party vendors in
respect thereof will be reimbursed by Customer as more fully described in Annex
1-F.

3.6.Project Management.

Project management includes the creation and agreement of critical path
schedules, liaison with Customer's designated network personnel, implementation
and configuration of all Network connections and overall management of
Customer's account.

24

--------------------------------------------------------------------------------

Annex 1-C—Network Services Acceptance Tests.

1.Tail Circuits. Equant will perform a 15 minute Bit Error Rate Test to ensure
that no more than one error in 106 data bits occur on the Tail Circuit.

2.Frame Relay Functionality Testing. Equant will perform:

•A test to confirm that a route DTE supporting Frame Relay attached via a Tail
Circuit to a Node is able to establish link-level communications via a
pre-designated local DLCI address with the Node local to the Site.

•A test to confirm that application data is able to be successfully transferred
up to the registered CIR level between Customer-sited router DTEs supporting
Frame Relay, via PVC routers and pre-designated local DLCI addresses.

3.IP Private Dial Testing. Customer will be deemed to have accepted the Service
at a Location upon issuance of a domain name.

4.Alternative Testing. Where TO operating conditions are such that the
Acceptance Tests are not appropriate, Equant shall carry out alternative
commissioning tests as agreed between the Parties. In this event, Equant will
provide to Customer a written description of these alternative acceptance tests.

25

--------------------------------------------------------------------------------

Annex 1-D—Network Service Descriptions

1Description Of Equant Frame Relay Service

1.1Equant Frame Relay Service

The Equant Frame Relay Service is delivered on the Equant Global Network (EGN).
Equant's Frame Relay service provides a Committed Information Rate based service
with Burst Mode Options. Equant's Frame Relay service conforms to:

STANDARDS INSTITUTE

--------------------------------------------------------------------------------

  STANDARD

--------------------------------------------------------------------------------

  LIMITATIONS

--------------------------------------------------------------------------------

Frame Relay Forum   "Joint Specification"     Frame Relay Forum   UNI     ANSI  
T1.617 Annex D     ITU-T (CCITT)   Q.933 Annex A     ANSI   T.606; T1.606
addendum     ANSI   T1.617—1991     ANSI   T1.618—1991   Only 2 byte addressing
No CLLM mechanism

1.2Committed Information Rate

The Committed Information Rate (CIR), is the amount of bandwidth that Equant
agrees to make available to the Customer's Frame Relay Data Terminal Equipment
through the Network, enabling the transfer of data between any given Frame Relay
Permanent Virtual Circuit Ingress and Egress points during normal network
operational conditions. CIRs are provided on a per individual Data Link Channel
basis.

1.3Excess Information Rate

The Excess Information Rate (EIR), is the additional bandwidth that Equant agree
to make available, to enable the transfer of data between any given Frame Relay
Permanent Virtual Circuit Ingress and Egress points on a per Data Link Channel
Basis. The value of the EIR will be an additional 50 percent of the CIR, on
individual CIRs up to 128 Kbit/s, or the upper limit of the access line
bandwidth, dependent on whichever sum is the lesser. The EIR will be made
available as a sustained Network resource during normal Network operations. All
data submitted within the EIR range is eligible to be discarded under adverse
Network conditions.

1.4Premium Burst Option

Premium Burst is an additional Equant Frame Relay service feature that provides
additional bursting capacity of up to an additional 100% of the CIR value on any
given individual CIR or the access line bandwidth, dependent on whichever sum is
the lesser. The Premium Burst configurations will ensure that CIR will be equal
to or greater than 25% of the Access Speed unless otherwise agreed by Equant.

The Premium Burst facility will be made available to Customer's Frame Relay DTE
under the following terms and conditions:

Upon acceptance by Equant and subject to the payment of Charges by Customer, EIR
may be configured subject to the limitations below:

EIR usage will be limited to either:

(i)15 million characters per day (for both directions) per 8kbps of CIR; or

(ii)450MB of total traffic (that is, the combined CIR and EIR usage) for both
directions per month per 8 kbps of CIR.

26

--------------------------------------------------------------------------------

In the event that the EIR usage exceeds the limitations stated in above for
(i) 2 consecutive months; or (ii) 3 out of any 6 consecutive months, Equant
reserves the right, at its sole discretion, to take the steps set out below.

Equant may do either or both of the following:

(i)upgrade the CIR to a level such that the EIR usage is within the limitations
stated above; and

(ii)downgrade (to a level as determined by Equant) or terminate EIR over the
PVC.

Equant reserves the right to charge for the above upgrade or reconfiguration of
EIR.

2.Description of Equant IP Private Dial Service

The Private Dial service enables access to hosts using a native LAN protocol via
PSTN or ISDN, using point-to-point protocol (PPP). The service is accessed via a
PC or a router. The PC requires no additional hardware beyond a terminal adapter
or a modem, except an available serial Port (ie, any port on a PC that can
support a dial modem connection) and client software supporting PPP and
challenge handshake authentication protocol (CHAP).

To use the IP Private Dial Service, a user calls a public PSTN or ISDN telephone
number that gives the user access to the network access server. The user's
terminal, PC, or router then issues a CHAP user name, domain name, and encrypted
password. The call is sent automatically to the router defined to be associated
with the domain name specified via a layer 2 forwarding tunnel.

The IP Private Dial security server positively identifies the user as
authenticated and having access to the network or LAN and then opens an IP
session. Additional levels of security may also be procured (e.g., token-based
systems, etc.). Please note that this process is handled by the client software;
therefore, it is transparent to the user.

27

--------------------------------------------------------------------------------

Annex 1-E—Service Levels

1.Introduction.

In calculating Equant's performance using the metrics set forth below, Equant
will only be liable for its obligations hereunder as they relate to the Service
described in this Service Annex. Equant will not be liable for any required
remedial actions if the failure to meet a Service Level was caused by the
actions or inactions of (i) Customer or User; (ii) third parties; (iii) any
events that would be deemed Force Majeure Event as defined in Clause 1 of the
Agreement.

All words with initial caps are defined in Clause 9 of this SLA or Clause 1 of
the Agreement.

2.Conditions and Exclusions. This SLA and the remedies set out are subject to
the following conditions and exclusions:

2.1Save only in respect of material breach of this Agreement, this SLA sets out
Customer's sole and exclusive remedies for any failure by Equant to provide
Services in accordance with this Agreement Equant's periodic routine,
non-routine, or emergency maintenance of the Service, provided in a proper,
non-negligent manner and in accordance with commercially prudent practices will
not be deemed to be a failure of Equant to provide Services in accordance with
this Agreement, or the breach of any SLA.

2.2Customer must claim credits for unachieved SLA in writing within 120 days
following the end of the month in which Customer believes the Service Level was
not achieved. Within 30 days following receipt of the claim, Equant will confirm
in writing to Customer the amount of the credit, if any, from reports generated
by Equant. All credits will be issued within 60 days of Customer's written
claim.

2.3Customer's right of cancellation of a Service pursuant to Equant's failure to
meet a SLA must be exercised within 120 days of Equant's written confirmation of
that failure. If Customer does not notify Equant in writing of its election to
cancel, the availability of that particular remedy expires.

2.4Any termination of a Service or this Agreement by Customer due to Equant's
failure to meet its SLA obligations is without financial liability to Customer,
other than Customer's liability to pay for Service provided before the effective
date of termination.

2.5In no event will total credits due under for any unachieved SLA for any
Location or Service in any month exceed 100% of the Qualifying Charges for that
Location or Service in that month.

2.6Service Levels for Service Availability, Latency and P Grade will apply from
the first full month following the Date of Acceptance of the Service at the
relevant Location.

3.P Grade (IP Dial Services).

3.1Equant commits to an accessibility level of 99.5% during Peak Hours (as
defined below) for all calls placed by Customer. This accessibility level is
equal to 100 minus P-Grade indicator. P Grade means the probability of a call
being blocked, during Peak Hours, due to access ports not being available for
that call, which probability is expressed as percentage.

P Grade ratio = (accumulated duration in minutes of the maximum port occupancy
in the period × 100) (reference threshold for the period) where—the reference
threshold is set to 1500 minutes per week. Equant regularly monitors the P Grade
levels in every rotary and targets to maintain it at levels below 0.5%. For
purposes of this Clause 3.1, "Peak Hours" means the normal business hours of the
city and country where the call is placed.

28

--------------------------------------------------------------------------------

3.2If the accessibility level is not achieved in any Month, Customer will
receive a credit of 10% of the previous Month's usage Charges via the relevant
Node.

4.Network Path Availability (Frame Relay)

If an NPA Service Level is not met in any calendar month, Equant will grant
Customer a credit against the monthly recurring Port and CIR charge for any
affected Location, payable for the calendar month during which the Service Level
has been breached.

This credit shall be an amount calculated as follows:

10    x (NPA - Actual NPA)

--------------------------------------------------------------------------------

NPA   x    monthly port and CIR charge for the month concerned for the Location

provided that no credit will be paid until the difference between the relevant
NPA Service Level and the actual NPA is one tenth of one percent (0.10%) or
greater.    For example, if the NPA = 99.5%, the monthly Port and CIR Charges =
$1,800 and the actual NPA = 99.45%, then

10 × (99.5-99.45) / 99.5 × $1,800 = $9.05

5.Network Transit Time (Frame Relay)

If any NTT Performance Level is not achieved, Customer will receive a credit
against the Qualifying Charges for the affected Locations, calculated as
follows:

Actual NTT higher than NTT Service Level by less than 10%   No credit
Actual NTT higher than NTT Performance Level by greater than 10%
 
1% of Qualifying Charges for every 1% by which actual NTT is higher than the NTT
Service Level, up to a maximum credit of 100% of Qualifying Charges for the
affected Locations

Credits will be pro rated per millisecond.

6.Maximum Time To Attend (MTTA).

Equant commits to a MTTA of 4 hours (5 hours for Customer's Location in
Carpinteria, California USA), provided that:

6.1a call-out notification is received from Customer, and the call-out can be
made during the normal business day in the country in which the Location is
situated; and

6.2the Location is situated within a 50 mile radius of the nearest Equant
Service Center ("Normal Service"). This requirement does not apply to Customer's
Location in Carpinteria, California USA. If a call-out notification is received
and there are less than 4 hours remaining in the normal business day in the
applicable country (5 hours with respect to Customer's Carpinteria, California
Location), then the MTTA calculation will stop at the end of the normal business
day and resume on the following normal business day.

Remedial service on CPE other than Normal Service will be carried out soon as is
practicably possible, taking into account availability of service personnel, the
time and date of Customer's notification and the country concerned.

Where Equant provides Normal Service, but does not achieve an MTTA of 4 hours or
less (or 5 hours or less for Customer's Location in Carpinteria, California
USA), Customer will receive a credit of $150.00 up to a maximum of the Monthly
CPE Charges, for each full hour that Equant delays commencement of its remedial
activities.

29

--------------------------------------------------------------------------------

7.Fault Management.

Equant will:

•Issue a Trouble Ticket number to Customer when Customer reports each fault to
Equant;

•Inform Customer of Outages identified by Equant and not reported by Customer no
later than one (1) hour after detecting such faults;

•Provide Customer with copies of all Trouble Tickets opened.

If Customer can demonstrate that Equant has not achieved the above Service
Levels in any Month, the Parties will meet to discuss the reasons and Equant
will escalate to a senior Network manager for resolution.

All escalation of faults will be in accordance with the procedures described in
Annex 1-B.

8.Cancellation of Service. In addition to any credits due for any unachieved
SLA, in respect of all Service Levels, Customer shall be entitled to cancel the
Service at a Location, or this Agreement in its entirety, in the following
circumstances:

•If the maximum credit is due in two (2) consecutive months, or in any four
(4) Months during any 12 month period, at any Location, Customer will be
entitled to terminate the affected Service at the affected Location, by giving
Equant at least 30 days prior notice.

•If the maximum credit is due in 2 consecutive months, or in any 4 months during
any 12 month period, at more than 50% of the Locations, Customer will be
entitled to terminate this Agreement in its entirety by giving Equant at least
30 days prior notice. For the purposes of this remedy, non-achievement of the
Service Level at a Hub Location that causes non-achievement of the same Service
Level at other Locations will be counted as one event.

The amount of any Shortfall, as defined in Clause 1 of Annex 1-F, shall be
reduced accordingly in the event of a cancellation of Service under this
Clause 8.

9.Definitions

    "Acceptance Tests"   means the processes employed by Equant to determine
that the Services are properly performing.
 
 
"Accessibility Level"
 
means the probability of accessing a free Port on a dial modem bank.
 
 
"Back-Up"
 
means either automatic ISDN back-up or redundant Tail Circuits with automatic
switching capability on a separate circuit path to the Tail Circuit. Back Up for
Hub Locations must include equivalent service levels and diverse routing.
 
 
"CIR"
 
or "Committed Information Rate" means the amount of bandwidth that is made
available to Customer on the end-to-end path between the Network Entry Access
Node and the Network Exit Access Node.
 
 
"EIR"
 
or "Excessive Information Rate" means the feature that allows Users to send
bursts of data that exceed the CIR allocated bandwidth. All frames within the
EIR range are tagged to denote they are eligible for discarding if network
congestion occurs.
 
 
 
 
 

30

--------------------------------------------------------------------------------

 
 
"Entry Access Node"
 
means the access node to which the originator data terminal equipment is
connected.
 
 
"Exit Access Node"
 
means the access node to which the destination data terminal equipment or host
computer is connected.
 
 
"Hub Location"
 
means the Location(s) designated as a hub or host Location by Customer.
 
 
"MTTA"
 
or "Mean Time To Attend" means the average time it takes for authorized Equant
field personnel to arrive at the Customer Location in the event of a fault,
failure or malfunction of the CPE that cannot be repaired or restored remotely.
 
 
"Node"
 
means a node of the Network to which Customer is connected via a Tail Circuit or
to which Customer dials in, such Nodes being deployed at such times and places
as determined by Equant.
 
 
"NPA"
 
or "Network Path Availability", means the availability of the virtual
communication path between the Entry Access Node and the Exit Access Node on the
Network excluding Scheduled Maintenance, host links, Tail Circuits, and CPE. NPA
is measured on a monthly basis.
 
 
"Network Transit Time"
 
or "NTT" means the elapsed time taken for the one way transmission of a one
hundred twenty-eight (128) character length packet (a "Packet") between the
entry point on the Network Node to which Customer's transmitter of the Packet is
connected, and the exit point on the Network Node to which the receiver of the
Packet is connected, averaged over a calendar month. NTT excludes Tail Circuits
and CPE.
 
 
"Outage"
 
means the non-availability of the Service at a Location, specifically that
Customer or User cannot send or receive data using the Service.
 
 
"P Grade"
 
means a monthly measurement of congestion (or blocking) at the X.28/RLA/PPP
rotary, expressed as a percentage, excluding availability and quality of the
PSTN from the user to the rotary.
 
 
"Qualifying Charges"
 
means all monthly recurring Charges excluding Tail Circuit Charges and all
one-time charges, including installation, project management and professional
services charges.
 
 
"Scheduled Maintenance"
 
means maintenance scheduled by Equant to occur during low network traffic
periods three to five times per year to implement generic changes to, or generic
version updates of, the Network and lasting an average of five minutes each.
 
 
"Third Party Intervention"
 
means intervention by any person not authorized by Equant.
 
 
 
 
 

31

--------------------------------------------------------------------------------

Schedule 1—Service Levels

LOCATION

--------------------------------------------------------------------------------

 
NTT
(ms)

--------------------------------------------------------------------------------

 
NPA
(%)

--------------------------------------------------------------------------------

 
 
 
 
 
 
 
Host Location
 
 
 
 
 
Carpinteria, CA USA
 
N/A
 
99.99
%
Carpinteria, CA USA
 
N/A
 
99.99
%
Mt. Laurel, NJ
 
N/A
 
99.99
%
Remotes to Carpinteria, California
 
 
 
 
 
Nieuwegein, Netherlands
 
139
 
99.99
%
Wanchai, Hong Kong
 
100
 
99.99
%
Sydney, Australia
 
114
 
99.99
%
Mumbai, India
 
190
 
99.99
%
Mexico City, Mexico
 
80
 
99.99
%
Limerick, Ireland
 
145
 
99.99
%
Sao Paulo, Brazil
 
140
 
99.99
%
Grand Rapids, Michigan USA
 
95
 
99.99
%
Chicago, Illinois USA
 
91
 
99.99
%
Powell, TN USA
 
60
 
99.99
%
Rancho Pales Verdes, CA USA
 
30
 
99.99
%
San Mateo, CA USA
 
30
 
99.99
%
Remotes to Mt. Laurel
 
 
 
 
 
Grand Rapids, Michigan USA
 
40
 
99.99
%
Chicago, Illinois USA
 
40
 
99.99
%
Rancho Pales Verdes, CA USA
 
60
 
99.99
%
Remotes to Nieuwegein, Netherlands
 
 
 
 
 
Alfortville, France
 
40
 
99.99
%
Annecy, France
 
40
 
99.99
%
Hoofddorp, Netherlands
 
30
 
99.99
%
Istanbul, Turkey
 
55
 
99.99
%
Willich, Germany
 
30
 
99.99
%
Wroclaw, Poland
 
40
 
99.99
%
Dudley, UK
 
30
 
99.99
%
Durban, South Africa
 
128
 
99.99
%
 
 
 
 
 
 

32

--------------------------------------------------------------------------------

Milan, Italy
 
30
 
99.99
%
Remote to Durban
 
 
 
 
 
Johannesburg, South Africa
 
40
 
99.99
%
Remote to Milan
 
 
 
 
 
Turin, Italy
 
30
 
99.99
%
Remotes to Hong Kong
 
 
 
 
 
Bangkok, Thailand
 
58
 
99.99
%
Singapore
 
47
 
99.99
%
Tokyo, Japan
 
40
 
99.99
%
Remote to Tokyo
 
 
 
 
 
Osaka, Japan
 
30
 
99.99
%
Remotes to Sydney, Australia
 
 
 
 
 
Adelaide, Australia
 
40
 
99.99
%
Melbourne, Australia
 
35
 
99.99
%
Milton, Australia
 
35
 
99.99
%

33

--------------------------------------------------------------------------------

Annex 1-F—Pricing

1.Services Commitment

Customer agrees that it shall have paid or shall be due to pay One Million One
Hundred Twenty Thousand Dollars ($1,120,000) in "Qualifying Charges" (as defined
below) under this Agreement ("Services Commitment") during the period commencing
on the Effective Date and ending twelve (12) months from that date, and during
each consecutive twelve (12) month period during the Term of this Agreement (or
a pro-rated amount for any portion thereof) thereafter (each such consecutive
twelve (12) month period referred to as an "Annual Period").

The term "Qualifying Charges" shall refer to all Charges for the Services
ordered under this Agreement, including all Tail Circuit charges and charges for
CPE.

Should the actual Qualifying Charges invoiced to Customer during any Annual
Period be less than the Services Commitment, Equant shall invoice, and Customer
shall pay, the difference between the actual Qualifying Charges invoiced to
Customer during the applicable Annual Period and the Services Commitment
("Shortfall") in accordance with Clause 4 of the Agreement.

2.Charges

Charges for the Service are set out in the following tables attached to this
Annex 1-F (collectively, the "Table"). Charges shall be invoiced and paid in
accordance with Clause 4 of this Agreement.

3.Commencement of Charges

All Charges shall commence from the Date of Acceptance of the Service at a
Location except that: (a) Tail Circuit Charges shall commence from the date of
installation of the Tail Circuit at a Location by the TO; (b) any Software
license fees shall commence from the date of delivery of the Software to
Customer.

4.Monthly Recurring/One Time Charges

Unless otherwise stated, all Charges set out in the Table are monthly recurring.
All connection, disconnection and project management charges are one time only
charges.

5.Tail Circuit Charges

Tail Circuit Charges shall be as set out in the Table or otherwise as notified
by Equant from time to time.

6.Network User Identifier ("NUI") Charges

NUI Charges shall be $10 per NUI per month plus a one time set up Charge of $10
per NUI.

34

--------------------------------------------------------------------------------

Table 1 to Annex 1-F Zones for Remote IP Dial Charges

Group 1

--------------------------------------------------------------------------------

  Group 2

--------------------------------------------------------------------------------

  Group 3

--------------------------------------------------------------------------------

  Group 4

--------------------------------------------------------------------------------

*   *   *   *   *   *   *                           Group 5

--------------------------------------------------------------------------------

  Group 6

--------------------------------------------------------------------------------

  Group 7

--------------------------------------------------------------------------------

  Group 8

--------------------------------------------------------------------------------

  Group 9

--------------------------------------------------------------------------------

  Group 10

--------------------------------------------------------------------------------

  Group 11

--------------------------------------------------------------------------------

*   *   *   *   *   *   *                           Group 12

--------------------------------------------------------------------------------

  Group 13

--------------------------------------------------------------------------------

  Group 14

--------------------------------------------------------------------------------

  ROW

--------------------------------------------------------------------------------

*   *   *   *   *   *   *

*Confidential portions omitted and filed separately with the Securities and
Exchange Commission.

35

--------------------------------------------------------------------------------

Table 2 to Annex 1-F—IP Dial Usage Charges

Route

--------------------------------------------------------------------------------

  Group 1

--------------------------------------------------------------------------------

  Group 2

--------------------------------------------------------------------------------

  Group 3

--------------------------------------------------------------------------------

  Group 4

--------------------------------------------------------------------------------

  Group 5

--------------------------------------------------------------------------------

  Group 6

--------------------------------------------------------------------------------

  Group 7

--------------------------------------------------------------------------------

  Group 8

--------------------------------------------------------------------------------

  Group 9

--------------------------------------------------------------------------------

  Group 10

--------------------------------------------------------------------------------

  Group 11

--------------------------------------------------------------------------------

  Group 12

--------------------------------------------------------------------------------

  Group 13

--------------------------------------------------------------------------------

  Group 14

--------------------------------------------------------------------------------

  ROW

--------------------------------------------------------------------------------

Domestic   *   *   *   *   *   *   *   *   *   *   *   *   *   *   * Group 1   *
  *   *   *   *   *   *   *   *   *   *   *   *   *   * Group 2   *   *   *   *
  *   *   *   *   *   *   *   *   *   *   * Group 3   *   *   *   *   *   *   *
  *   *   *   *   *   *   *   * Group 4   *   *   *   *   *   *   *   *   *   *
  *   *   *   *   * Group 5   *   *   *   *   *   *   *   *   *   *   *   *   *
  *   * Group 6   *   *   *   *   *   *   *   *   *   *   *   *   *   *   *
Group 7   *   *   *   *   *   *   *   *   *   *   *   *   *   *   * Group 8   *
  *   *   *   *   *   *   *   *   *   *   *   *   *   * Group 9   *   *   *   *
  *   *   *   *   *   *   *   *   *   *   * Group 10   *   *   *   *   *   *   *
  *   *   *   *   *   *   *   * Group 11   *   *   *   *   *   *   *   *   *   *
  *   *   *   *   * Group 12   *   *   *   *   *   *   *   *   *   *   *   *   *
  *   * Group 13   *   *   *   *   *   *   *   *   *   *   *   *   *   *   *
Group 14   *   *   *   *   *   *   *   *   *   *   *   *   *   *   * ROW   *   *
  *   *   *   *   *   *   *   *   *   *   *   *   *

*Confidential portions omitted and filed separately with the Securities and
Exchange Commission.

36

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Table 3 to Annex 1-F Monthly IP Dial Fixed Charges

Location

--------------------------------------------------------------------------------

  Tail
Circuit
Speed
(kbps)

--------------------------------------------------------------------------------

  Port Speed
(kbps)

--------------------------------------------------------------------------------

  CIR Speed
(kbps)

--------------------------------------------------------------------------------

  Tail Circuit

--------------------------------------------------------------------------------

  Tail
Circuit
Mgmt.

--------------------------------------------------------------------------------

  Port

--------------------------------------------------------------------------------

  CIR

--------------------------------------------------------------------------------

  Managed
Router

--------------------------------------------------------------------------------

  Monthly Total

--------------------------------------------------------------------------------

Carpinteria, CA   T-1   384K   N/A   *   *   *   *   *   *
New Joy, Netherlands
 
E-1
 
512K
 
N/A
 
*
 
*
 
*
 
*
 
*
 
*
Mt. Laurel, NJ
 
T-1
 
512K
 
N/A
 
*
 
*
 
*
 
*
 
*
 
*
Hong Kong, HK
 
512K
 
256K
 
N/A
 
*
 
*
 
*
 
*
 
*
 
*
Sydney, Australia
 
512K
 
256K
 
N/A
 
*
 
*
 
*
 
*
 
*
 
*
TOTAL
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
*

*Confidential portions omitted and filed separately with the Securities and
Exchange Commission.

37

--------------------------------------------------------------------------------

Table 4 to Annex 1-F—Frame Relay Charges

 
   
   
   
  MONTHLY RECURRING CHARGES

--------------------------------------------------------------------------------

LOCATION

--------------------------------------------------------------------------------

  CIRCUIT

--------------------------------------------------------------------------------

  PORT

--------------------------------------------------------------------------------

  CIR

--------------------------------------------------------------------------------

  CIRCUIT
CHARGES

--------------------------------------------------------------------------------

  PORT
CHARGES

--------------------------------------------------------------------------------

  CIR
CHARGES

--------------------------------------------------------------------------------

  TOTAL
CHARGES

--------------------------------------------------------------------------------

Host Location                             Carpinteria, CA USA   1536K   1536K  
N/A   *   *   *   * Carpinteria, CA USA   1536K   512K   N/A   *   *   *   * Mt.
Laurel, NJ   1536K   512K   N/A   *   *   *   *
Remotes to Carpinteria, California
 
 
 
 
 
 
 
 
 
 
 
 
 
  Nieuwegein, Netherlands   2048K   2048K   768K   *   *   *   * Wanchai, Hong
Kong   512K   512K   256K   *   *   *   * Sydney, Australia   512K   512K   256K
  *   *   *   * Mumbai, India   2048K   512K   128K   *   *   *   * Mexico City,
Mexico   256K   256K   192K   *   *   *   * Limerick, Ireland   384K   384K  
256K   *   *   *   * Sao Paulo, Brazil   256K   256K   96K   *   *   *   * Grand
Rapids, Michigan USA   256K   256K   192K   *   *   *   * Chicago, Illinois USA
  256K   256K   64K   *   *   *   * Powell, TN USA   128K   128K   96K   *   *  
*   * Rancho Pales Verdes, CA USA   56K   56K   16K   *   *   *   * San Mateo,
CA USA   384K   384K   256K   *   *   *   *
Remotes to Mt. Laurel
 
 
 
 
 
 
 
 
 
 
 
 
 
  Grand Rapids, Michigan USA   256K   256K   24K   *   *   *   * Chicago,
Illinois USA   256K   256K   64K   *   *   *   * Rancho Pales Verdes, CA USA  
56K   56K   16K   *   *   *   *
Remotes to Nieuwegein, Netherlands
 
 
 
 
 
 
 
 
 
 
 
 
 
  Alfortville, France   128K   128K   48K   *   *   *   * Annecy, France   128K
  128K   96K   *   *   *   * Istanbul, Turkey   128K   64K   48K   *   *   *   *
Willich, Germany   128K   128K   64K   *   *   *   * Wroclaw, Poland   256K  
256K   48K   *   *   *   * Dudley, UK   E-1   768K   256K   *   *   *   *
Durban, South Africa   128K   128K   64K   *   *   *   * Milan, Italy   256K  
256K   128K   *   *   *   *
Remote to Durban
 
 
 
 
 
 
 
 
 
 
 
 
 
  Johannesburg, South Africa   128K   128K   48K   *   *   *   *
Remote to Milan
 
 
 
 
 
 
 
 
 
 
 
 
 
  Turin, Italy   128K   128K   64K   *   *   *   *
Remotes to Hong Kong
 
 
 
 
 
 
 
 
 
 
 
 
 
  Bangkok, Thailand   256K   128K   64K   *   *   *   * Singapore   128K   128K
  96K   *   *   *   * Tokyo, Japan   256K   256K   192K   *   *   *   *
Remote to Tokyo
 
 
 
 
 
 
 
 
 
 
 
 
 
  Osaka, Japan   64K   64K   32K   *   *   *   *
Remotes to Sydney, Australia
 
 
 
 
 
 
 
 
 
 
 
 
 
  Adelaide, Australia   128K   128K   64K   *   *   *   * Melbourne, Australia  
256K   256K   96K   *   *   *   * Milton, Australia   128K   128K   64K   *   *
  *   *    

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

Total               *   *   *   *                

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Notes: 1) There are no installation charges specified for the above Locations
because the Service is already installed at these Locations as of the Effective
Date.
 
2)
There will be a one-time project management charge applied for each Change Order
submitted.
 
3)
Charges for Web Vision, TT Vision and I Vision are waived for Customer during
the Term.
 
4)
The Charges above include one (1) Customer Operations Manager.
 
 
 

*Confidential portions omitted and filed separately with the Securities and
Exchange Commission.

38

--------------------------------------------------------------------------------

QuickLinks

MASTER SERVICES AGREEMENT BETWEEN EQUANT INC. AND QAD INC. AGREEMENT NUMBER:
MSA/US/QAD/06/02/05 DATED: June 6, 2002 Final
Annex 1-F—Pricing
Table 2 to Annex 1-F—IP Dial Usage Charges