Filed by sedaredgar.com - Net 1 UEPS Technologies, Inc. - Exhibit 10.45






     Exhibit 10.45 

 

Execution Copy 

 

 

27 August 2008 


SMARTSWITCH NETHERLANDS C.V. 

as the Borrower 

 

and 

NET1 UEPS TECHNOLOGIES, INC. 

as Subordinated Creditor 

and 

 

INVESTEC BANK (UK) LIMITED 

as the Lender 

 

______________________________________

DEED OF SUBORDINATION

______________________________________

 

 

 

Herbert Smith LLP 




TABLE OF CONTENTS 

	Clause 	Headings 	Page 
	 	 	 
	1. 	DEFINITIONS, CONSTRUCTION AND THIRD PARTY RIGHTS 	1 
	 	 	 
	2. 	RANKING OF DEBT 	2 
	 	 	 
	3. 	UNDERTAKINGS OF BORROWER 	3 
	 	 	 
	4. 	UNDERTAKINGS OF SUBORDINATED CREDITOR 	3 
	 	 	 
	5. 	TURNOVER OF RECEIPTS 	4 
	 	 	 
	6. 	SUBORDINATION ON INSOLVENCY 	4 
	 	 	 
	7. 	VOTING 	5 
	 	 	 
	8. 	TREATMENT OF DISTRIBUTIONS 	5 
	 	 	 
	9. 	ENFORCEMENT 	6 
	 	 	 
	10. 	ENFORCEMENT BY THE LENDER 	6 
	 	 	 
	11. 	CONSENTS 	7 
	 	 	 
	12. 	REPRESENTATIONS AND WARRANTIES 	7 
	 	 	 
	13. 	INFORMATION BY SUBORDINATED CREDITORS 	8 
	 	 	 
	14. 	SUBROGATION BY SUBORDINATED CREDITORS 	9 
	 	 	 
	15. 	PROTECTION OF SUBORDINATION 	9 
	 	 	 
	16. 	PRESERVATION OF SUBORDINATED DEBT 	10 
	 	 	 
	17. 	POWER OF ATTORNEY 	10 
	 	 	 
	18. 	EXPENSES, DEFAULT INTEREST ETC 	10 
	 	 	 
	19. 	CHANGES TO THE PARTIES 	12 
	 	 	 
	20. 	STATUS OF BORROWER 	13 
	 	 	 
	21. 	LIABILITY OF LENDER 	13 
	 	 	 
	22. 	NOTICES 	13 
	 	 	 
	23. 	PARTIAL INVALIDITY 	14 
	 	 	 
	24. 	REMEDIES AND WAIVERS CUMULATIVE 	14 
	 	 	 
	25. 	COUNTERPARTS 	14 








	26. 	GOVERNING LAW 	14 
	 	 	 
	27. 	JURISDICTION 	15 







THIS DEED OF SUBORDINATION is dated 27 August 2008 and
made 

BETWEEN: 

	(1) 	
      SMARTSWITCH NETHERLANDS C.V. (a limited
      partnership registered in the Netherlands under number 24439756 acting
      through its general partner SMARTSWITCH USA LLC, a limited
      liability company organised and existing under the laws of Delaware as
      borrower (the "Borrower")

	 	 
	(2) 	
      UEPS TECHNOLOGIES, INC. (a company incorporated in
      Florida with company registration number P97000041098 whose registered
      office is at 100 North Tampa, Suite 2200, Tampa, Florida (the
      "Subordinated Creditor"); and

	 	 
	(3) 	
      INVESTEC BANK UK LIMITED (the
    "Lender").



IT IS AGREED as follows: 

	1. 	
      DEFINITIONS, CONSTRUCTION AND THIRD PARTY
      RIGHTS

	 	 
	1.1 	
      Definitions

	 	 
		
      Terms defined in the Facility Agreement shall, unless
      otherwise defined in this Deed or unless a contrary intention appears,
      bear the same meaning when used in this Deed and the following terms shall
      have the following meanings:

	 	 
		
      "Ancillary Liabilities" in relation to any of the
      Senior Debt or the Subordinated Debt means:




	 	(A) 	
      any refinancing, novation, refunding, restructuring,
      deferral or extension of any of those liabilities;

	 	 	 
	 	(B) 	
      any further advance which may be made under any agreement
      supplemental to the relevant facilities or credit agreement plus all
      interest, indemnities, fees and costs in connection therewith;

	 	 	 
	 	(C) 	
      any claim for damages or restitution in the event of
      rescission of any such liabilities or otherwise in connection with any
      relevant facilities or credit agreement;

	 	 	 
	 	(D) 	
      any claim against the Borrower flowing from any recovery
      by the Borrower of a payment or discharge in respect of those liabilities
      on the grounds of preference or otherwise; and

	 	 	 
	 	(E) 	
      any amounts (including post-insolvency interest) which
      would be included in any of the above but for any discharge,
      non-provability, unenforceability or non- allowability of the same in any
      insolvency or other proceedings.



"Facility Agreement" means the
facility agreement between, among others, the Borrower and the Lender dated on
or around the date of this Deed.

"Debt" means: 

	 	(A) 	
      the Senior Debt; and

	 	 	 
	 	(B) 	
      the Subordinated Debt.



"Party" means a party to this
Deed. 

"Receiver" means a Receiver as
defined in any of the Senior Security Documents. 

1 





		
      "Senior Debt" means all present and future sums,
      liabilities and obligations (actual or contingent) payable, owing, due or
      incurred by the Borrower to the Lender under or in connection with a
      Finance Document together with all Ancillary Liabilities relating
      thereto.

	 	 
		
      "Senior Discharge Date" means the date, as
      determined by the Lender, on which all Senior Debt has been
      unconditionally and irrevocably paid and discharged in full to the
      satisfaction of the Lender whether or not by enforcement and on which no
      commitment is in force under the Finance Documents.

	 	 
		
      "Senior Security Documents" means a Security
      Document as defined in the Facility Agreement.

	 	 
		
      "Subordinated Debt" means all present and future
      sums, liabilities and obligations whatsoever (actual or contingent)
      payable, owing due or incurred by the Borrower to the Subordinated
      Creditor together with all Ancillary Liabilities relating
  thereto.

	 	 
		
      "Subordinated Document" means any document
      evidencing or recording the terms of any Subordinated Debt.

	 	 
	1.2 	
      Construction

	 	 
		
      The provisions of clause 1.2 of the Facility Agreement
      apply to this Deed as though they were set out in full in this
  Deed.

	 	 
	1.3 	
      Third Party Rights

	 	 
		
      Except as otherwise expressly provided in this Deed, no
      term of this Deed is enforceable under the Contracts (Rights of Third
      Parties) Act 1999 by a person who is not a party to this Deed.

	 	 
	1.4 	
      Effect as a Deed

	 	 
		
      This Deed is intended to take effect as a deed
      notwithstanding that the Lender may have executed it under hand
    only.

	 	 
	2. 	
      RANKING OF DEBT

	 	 
	2.1 	
      Ranking of Debt

	 	 
		
      Subject to the terms of this Deed, the Debt shall rank in
      the following order:




	 	First 	Senior Debt 
	 	 	 
	 	Second 	Subordinated Debt.




	2.2 	
      Application of ranking

	 	 	 
		
      The ranking in Clause 2.1 (Ranking of Debt) shall
      apply regardless of:

	 	 	 
		2.2.1 	
      the order of registration, delivery of, notice or
      execution of any document;

	 	 	 
		2.2.2 	
      the date upon which any Debt arises;

	 	 	 
		2.2.3 	
      whether the Lender is obliged to advance moneys included
      in any Debt; or

	 	 	 
		2.2.4 	
      any fluctuations in the outstanding amount of, or any
      intermediate discharge of, any Debt in whole or in
part.



2 





	3. 	
      UNDERTAKINGS OF BORROWER

	 	 	 
		
      So long as any Senior Debt is or may become outstanding,
      the Borrower undertakes to the Lender that it will not:

	 	 	 
		3.1.1 	
      discharge any of the Subordinated Debt;

	 	 	 
		3.1.2 	
      create or permit to subsist any security over any of its
      assets for, or any guarantee, indemnity or other assurance against
      financial loss in respect of, any of the Subordinated Debt;

	 	 	 
		3.1.3 	
      pay, repay, prepay, redeem, pay any interest, fees,
      dividends or commissions on or by reference to, purchase or otherwise
      acquire, any of the Subordinated Debt in cash or in kind nor allow any of
      its Subsidiaries to do so;

	 	 	 
		3.1.4 	
      purchase or acquire any of the Subordinated Debt or any
      interest therein nor allow any of its Subsidiaries to do so;

	 	 	 
		3.1.5 	
      amend, waive or release any term of the Subordinated
      Documents, except for an amendment, waiver or release which does not
      prejudice any Senior Debt, the Lender or impair the subordination
      contemplated by this Deed; or

	 	 	 
		3.1.6 	
      take or omit to take any action whereby the subordination
      contemplated by this Deed may be impaired.

	 	 	 
	4. 	
      UNDERTAKINGS OF SUBORDINATED CREDITOR

	 	 	 
		
      So long as any Senior Debt is or may become outstanding,
      the Subordinated Creditor undertakes to the Lender:

	 	 	 
		4.1.1 	
      not to demand or receive payment, prepayment or repayment
      of, or any distribution in respect of (or on account of) any of the
      Subordinated Debt in cash or in kind from the Borrower or any other source
      or apply any money or property in discharge of any Subordinated
    Debt;

	 	 	 
		4.1.2 	
      not to discharge any of the Subordinated Debt by
      set-off;

	 	 	 
		4.1.3 	
      not to permit to subsist or receive the benefit of any
      security interest, guarantee, indemnity or other assurance against
      financial loss for, or in respect of, any of the Subordinated
  Debt;

	 	 	 
		4.1.4 	
      not to take or omit to take any action whereby the
      subordination contemplated by this Deed may be impaired;

	 	 	 
		4.1.5 	
      not to amend, waive or release any term of the
      Subordinated Documents, except for an amendment which does not prejudice
      any Senior Debt, the Lender or impair the subordination contemplated by
      this Deed;

	 	 	 
		4.1.6 	
      not to convert any of the Subordinated Debt into shares
      of the Borrower; and

	 	 	 
		4.1.7 	
      to endorse a memorandum of this Deed on each document
      evidencing any Subordinated Debt.



3 





	5. 	
      TURNOVER OF RECEIPTS

	 	 	 
	5.1 	
      Non-permitted payments

	 	 	 
		
      If before the Senior Discharge Date:

	 	 	 
		5.1.1 	
      the Subordinated Creditor receives a payment or
      distribution in cash or in any other form in respect of, or on account of
      the Subordinated Debt from the Borrower or any other source;

	 	 	 
		5.1.2 	
      the Subordinated Creditor receives the proceeds of any
      enforcement of any security, or payment under any guarantee, for any
      Subordinated Debt; or

	 	 	 
		5.1.3 	
      the Borrower makes any payment or distribution in cash or
      in any other form on account of the purchase or other acquisition of any
      of the Subordinated Debt,

	 	 	 
			
      the Subordinated Creditor will forthwith pay any and all
      such amounts to the Lender for application against the Senior Debt and
      until it does so shall hold all such amounts on trust for the
    Lender.

	 	 	 
	5.2 	
      Non-permitted set-off

	 	 	 
		
      If, for any reason, any of the Subordinated Debt is
      discharged in whole or in part by set-off, the Subordinated Creditor will
      forthwith pay an amount equal to the amount of the Subordinated Debt
      discharged by the set-off to the Lender for application against the Senior
      Debt.

	 	 	 
	6. 	
      SUBORDINATION ON INSOLVENCY

	 	 	 
	6.1 	
      Subordination events

	 	 	 
		
      If:

	 	 	 
		6.1.1 	
      any distribution, assignment, division or application,
      partial or complete, voluntary or involuntary, by operation of law or
      otherwise, of all or any part of the assets of the Borrower, by reason of
      the liquidation, dissolution or other winding-up of the Borrower or its
      businesses or any sale, receivership, administration or insolvency
      proceeding for the benefit of creditors in respect of the Borrower is made
      or occurs; or

	 	 	 
		6.1.2 	
      an Event of Default is continuing,

	 	 	 
			
      the provisions of Clause 6.2 (Subordination) shall
      apply.

	 	 	 
	6.2 	
      Subordination

	 	 	 
		
      In any of the circumstances mentioned in Clause 6.1
      (Subordination events):

	 	 	 
		6.2.1 	
      the Subordinated Debt shall be postponed and subordinated
      in right of payment to the Senior Debt;

	 	 	 
		6.2.2 	
      the Lender may, and is irrevocably authorised on behalf
      of the Subordinated Creditor to:

	 	 	 
			
      (A)        claim,
      enforce and prove for the Subordinated Debt;



4 





	 	(B) 	
      file claims and proofs, give receipts and take all such
      proceedings and do all such things as the Lender sees fit to recover the
      Subordinated Debt; and

	 	 	 
	 	(C) 	
      receive all distributions on the Subordinated Debt for
      application towards the Senior Debt;




	 	6.2.3 	
      if and to the extent that the Lender is not entitled to
      claim, enforce, prove, file claims or proofs, or take proceedings for the
      Subordinated Debt, the Subordinated Creditor shall do so in good time as
      requested by the Lender acting in accordance with the instructions of the
      Lender;

	 	 	 	 
	 	6.2.4 	
      the Subordinated Creditor shall:

	 	 	 	 
	 		(A) 	
      hold any payment or distribution in cash or in kind
      received or receivable by it in respect of the Subordinated Debt from the
      Borrower or its estate or from any other source on trust for the Lender;
      and

	 	 	 	 
	 		(B) 	
      upon demand promptly pay and transfer any such payment to
      the Lender for application against the Senior Debt; and

	 	 	 	 
	 	6.2.5 	
      the trustee in bankruptcy, liquidator, assignee or other
      person distributing the assets of the Borrower or their proceeds is
      directed to pay distributions on the Subordinated Debt direct to the
      Lender until the Senior Debt is irrevocably paid in
full.




	7. 	
      VOTING

	 	 	 	 
		
      If any of the events referred to in Clause 6.1
      (Subordination events) occurs:

	 	 	 	 
		7.1.1 	
      the Lender may (and is hereby irrevocably authorised to)
      exercise all powers of convening meetings, voting and representation in
      respect of the Subordinated Debt and the Subordinated Creditor shall
      provide the Lender with all necessary forms of proxy and of
      representation; and

	 	 	 	 
		7.1.2 	
      if and to the extent that the Lender is not entitled to
      exercise a power conferred by the above, the Subordinated
  Creditor:

	 	 	 	 
			(A) 	
      shall exercise the power as the Lender directs;
  and

	 	 	 	 
			(B) 	
      shall not exercise any power so as to impair this
      subordination.

	 	 	 	 
	8. 	
      TREATMENT OF DISTRIBUTIONS

	 	 	 	 
	8.1 	
      Realisation of non-cash distributions

	 	 	 	 
		
      If the Lender receives any distribution otherwise than in
      cash in respect of the Subordinated Debt from the Borrower or any other
      source, the Lender may realise the distribution as it sees fit and the
      Senior Debt shall not be deemed reduced by the distribution until and
      except to the extent that the realisation proceeds are applied towards the
      Senior Debt.

	 	 	 	 
	8.2 	
      Transfer of distributions

	 	 	 	 
		
      The Subordinated Creditor shall do all such things as the
      Lender may require as being necessary or desirable to transfer to the
      Lender all payments and distributions which must be turned over or held in
      trust for the Lender, including endorsements and execution of formal
      transfers, and shall pay all costs and stamp duties in connection
      therewith.



5 





	8.3 	
      Currencies

	 	 
		
      If the Lender receives any payment required to be paid by
      the Subordinated Creditor under this Deed or paid in respect of the
      Subordinated Debt in a currency other than the currency of the Senior
      Debt, the Lender may convert the currency received into the currency of
      the Senior Debt at a prevailing market rate of exchange and the Senior
      Debt shall not be deemed reduced by the payment until and except to the
      extent that the proceeds of conversion are applied towards the Senior
      Debt.

	 	 
	8.4 	
      Failure of trust

	 	 
		
      If for any reason, a trust in favour of, or a holding of
      property for, the Lender under this Deed is invalid or unenforceable, the
      Subordinated Creditor shall pay and deliver to the Lender an amount equal
      to the payment, receipt or recovery in cash or in kind (or its value, if
      in kind) which the Subordinated Creditor would otherwise have been bound
      to hold on trust for or as property of the Lender.

	 	 
	9. 	
      ENFORCEMENT

	 	 
		
      Until the Senior Discharge Date, the Subordinated
      Creditor shall not be entitled:

	 	 
	9.1 	
      to accelerate any of the Subordinated Debt or otherwise
      declare any of the Subordinated Debt prematurely payable;

	 	 
	9.2 	
      either alone or in conjunction with any other person, to
      commence or take any action against the Borrower for the enforcement of,
      or in connection with, any Subordinated Document (including for the
      payment of any amount thereunder or in respect of a breach of a term
      thereunder) or for the termination thereof;

	 	 
	9.3 	
      to initiate or support or take any steps with a view to
      any insolvency, liquidation, reorganisation, receivership, administration,
      winding-up or dissolution proceedings or any voluntary arrangement or
      assignment for the benefit of creditors or any similar proceedings
      involving the Borrower, whether by petition, convening a meeting, voting
      in support of a resolution or otherwise;

	 	 
	9.4 	
      without prejudice to Clause 4.1.3 (Undertakings of
      Subordinated Creditor), to enforce any Security which secures any
      Subordinated Debt by foreclosure or otherwise or to exercise any right of
      marshalling; or

	 	 
	9.5 	
      otherwise to exercise any remedy for the recovery of the
      Subordinated Debt.

	 	 
	10. 	
      ENFORCEMENT BY THE LENDER

	 	 
		
      The Lender may enforce, or refrain from enforcing, the
      security created by any of the Senior Security Documents in accordance
      with their terms:

	 	 
	10.1 	
      in such manner as it sees fit;

	 	 
	10.2 	
      solely having regard to its interests; and

	 	 
	10.3 	
      without any liability or duty to any of the Subordinated
      Creditor.



6 





	11. 	
      CONSENTS

	 	 	 
	11.1 	
      New transactions

	 	 	 
		
      The Subordinated Creditor shall not have any remedy
      against the Borrower or the Lender by reason of any transaction entered
      into between the Lender and the Borrower which violates, does not comply
      with or is a potential event of default or an event of default (however
      described) under any Subordinated Document. The Subordinated Creditor may
      not object to any such transaction by reason of any provision of any of
      the Subordinated Documents.

	 	 	 
	11.2 	
      Waivers

	 	 	 
		
      Any waiver or consent granted by the Lender in respect of
      any Finance Document shall also be deemed to have been given by the
      Subordinated Creditor if any transaction or circumstances would, in the
      absence of that waiver or consent, violate or not comply with any
      Subordinated Document or result in a potential event of default or an
      event of default (however described) under any Subordinated
    Document.

	 	 	 
	12. 	
      REPRESENTATIONS AND WARRANTIES

	 	 	 
		
      The Subordinated Creditor represents and warrants to the
      Lender that:

	 	 	 
	12.1 	
      it is a duly incorporated corporation and validly
      existing under the laws of its jurisdiction of formation;

	 	 	 
	12.2 	
      it has the power to enter into and perform, and has taken
      all necessary action to authorise the entry into, performance and delivery
      of, this Deed;

	 	 	 
	12.3 	
      this Deed constitutes its legal, binding, valid and
      enforceable obligations subject to any general principles of law limiting
      its obligations which are specificially referred to in any legal opinion
      delivered pursuant to Clause 4 (Conditions of Utilisation) of the
      Facility Agreement;

	 	 	 
	12.4 	
      the entry into and performance by it of, and the
      transactions contemplated by, this Deed do not and will not:

	 	 	 
		12.4.1 	
      conflict with any law or regulation or judicial or
      official order applicable to it; or

	 	 	 
		12.4.2 	
      conflict with its constitutional documents; or

	 	 	 
		12.4.3 	
      conflict with any agreement or document which is binding
      upon it or any of its assets and it has obtained all necessary consents
      and authorisations for the performance by it of this Deed;

	 	 	 
	12.5 	
      it is the sole legal and beneficial owner of the
      Subordinated Debt owed to it and of the benefits of the Subordinated
      Documents free from any security interest, declaration of trust, option
      and subordination in favour of any person other than the Lender;

	 	 	 
	12.6 	
      the Subordinated Debt is not subject to any set-off,
      counterclaim or other defence;

	 	 	 
	12.7 	
      its payment obligations under this Deed rank at least
      pari passu with all its other present and future unsecured payment
      obligations, except for obligations mandatorily preferred by
law;

	 	 	 
	12.8 	
      no stamp or registration duty or similar Tax or charge is
      payable in its jurisdiction of incorporation in respect of this Deed and
      it is not necessary that this Deed be filed, recorded or enrolled with any
      court or other authority in any jurisdiction;



7 





	12.9 	
      all information provided by it or on its behalf in
      connection with or pursuant to this Deed or any other Transaction Document
      was true and accurate in all material respects as at the date it was
      provided or as at the date (if any) it was stated and nothing was omitted
      from such information that results in such information being untrue or
      misleading in any material respect;

	 	 	 
	12.10 	
      no litigation, arbitration or administrative proceedings
      of or before any court, arbitral body or agency which, if adversely
      determined, might reasonably be expected to have a materially adverse
      effect on its ability to comply with its obligations under this Deed have
      (to the best of its knowledge and belief) been started or threatened
      against it;

	 	 	 
	12.11 	
      the execution by it of this Deed constitutes, and the
      exercise by it of its rights and performance of its obligations under this
      Deed will constitute, private and commercial acts performed for private
      and commercial purposes and it will not be entitled to claim immunity from
      suit, execution, attachment or other legal process in any proceedings
      taken in its jurisdiction of incorporation in relation to this
  Deed;

	 	 	 
	12.12 	
      it is not necessary under the laws of its jurisdiction of
      incorporation:

	 	 	 
		12.12.1 	
      in order to enable the Lender to enforce its rights under
      this Deed; or

	 	 	 
		12.12.2 	
      by reason of the execution of this Deed or the
      performance by it of its obligations under this Deed,

	 	 	 
		
      that the Lender should be licensed, qualified or
      otherwise entitled to carry on business in its jurisdiction of
      incorporation and the Lender is not and will not be deemed to be resident,
      domiciled or carrying on business in its jurisdiction of incorporation by
      reason only of execution, performance and/or enforcement of this Deed;
      and

	 	 	 
	12.13 	
      its:

	 	 	 
		12.13.1 	
      irrevocable submission under this Deed to the
      jurisdiction of the courts of England;

	 	 	 
		12.13.2 	
      agreement that this Deed is governed by English law;
      and

	 	 	 
		12.13.3 	
      agreement not to claim any immunity to which it or its
      assets may be entitled,

	 	 	 
		
      are legal, valid and binding under the laws of its
      jurisdiction of incorporation and any judgment obtained in England will be
      recognised and be enforceable by the courts of its jurisdiction of
      incorporation.

	 	 	 
	12.14 	
      The representations set out in this Clause 12 are made on
      the date of this Deed and are deemed to be repeated by the Subordinated
      Creditor on each date until the Senior Discharge Date with reference to
      the facts and circumstances then existing.

	 	 	 
	13. 	
      INFORMATION BY SUBORDINATED CREDITORS

	 	 	 
	13.1 	
      Defaults

	 	 	 
		
      The Subordinated Creditor will, promptly upon becoming
      aware of the same, notify the Lender of the occurrence of any event of
      default or potential event of default (howsoever described) or mandatory
      prepayment event or other event entitling the Subordinated Creditor to
      demand prepayment or repayment of any Subordinated Debt prior to its
      specified maturity under the Subordinated
Documents.



8 





	13.2 	
      Amounts of debt

	 	 	 
		
      The Subordinated Creditor will on the written request by
      the Lender notify the Lender in writing of details of the amount of the
      Subordinated Debt.

	 	 	 
	14. 	
      SUBROGATION BY SUBORDINATED CREDITORS

	 	 	 
		
      If the Senior Debt is wholly or partially paid out of any
      proceeds received of or on account of the Subordinated Debt, the
      Subordinated Creditor (as the case may be) will to that extent be
      subrogated to the Senior Debt so paid (and all securities and guarantees
      for that Senior Debt) but not before the Senior Discharge Date.

	 	 	 
	15. 	
      PROTECTION OF SUBORDINATION

	 	 	 
	15.1 	
      Continuing subordination

	 	 	 
		
      The subordination provisions in this Deed constitute
      continuing subordination arrangements and benefit the ultimate balance of
      the Senior Debt, regardless of any intermediate payment or discharge of
      the Senior Debt in whole or in part.

	 	 	 
	15.2 	
      Waiver of defences

	 	 	 
		
      The subordination arrangements in this Deed and the
      obligations of the Subordinated Creditor under this Deed will not be
      affected by any act, omission, matter or thing which but for this
      provision, might operate to reduce, release or prejudice the subordination
      or any of those obligations in whole or in part, including without
      limitation:

	 	 	 
		15.2.1 	
      any time, waiver or indulgence granted to or composition
      with the Borrower or any other person;

	 	 	 
		15.2.2 	
      the taking of any other security interest from the
      Borrower or any other person or the variation, compromise, exchange,
      renewal or release of, or refusal or neglect to perfect, take up or
      enforce, any rights against, or security over assets of, the Borrower or
      any other person under the Finance Documents or otherwise or any
      non-presentation or non-observance of any formality or other requirement
      in respect of any instruments or any failure to realise the full value of
      any security;

	 	 	 
		15.2.3 	
      the release of the Borrower or any other person under the
      terms of any composition or arrangement;

	 	 	 
		15.2.4 	
      any incapacity or lack of power, authority or legal
      personality of or dissolution or change in the members or status of the
      Borrower or any other person;

	 	 	 
		15.2.5 	
      any amendment (however fundamental) or replacement of a
      Finance Document or any other document or security;

	 	 	 
		15.2.6 	
      any unenforceability, illegality or invalidity of any
      obligation of any person under any Finance Document or any other document
      or security;

	 	 	 
		15.2.7 	
      any winding-up, insolvency or similar proceedings in
      relation to any person; or

	 	 	 
		15.2.8 	
      any unenforceability, illegality or invalidity of any
      obligation of any person or any security under any of the Finance
      Documents or under any other document or security.



9 





	15.3 	
      Immediate recourse

	 	 	 
		
      The Subordinated Creditor waives any right it may have of
      first requiring the Lender (or any trustee or agent on its behalf) to
      proceed against or enforce any other rights or security or claim payment
      from any person before claiming the benefit of this subordination, of the
      security conferred by the Senior Security Documents or of the obligations
      of the Subordinated Creditor under this Deed. The Lender (or any trustee
      or agent on its behalf) may refrain from applying or enforcing any money,
      rights or security.

	 	 	 
	15.4 	
      Borrower's acknowledgement

	 	 	 
		
      The Borrower recognises the undertakings and obligations
      to and on the parts of the Subordinated Creditor herein contained and
      irrevocably waives any rights which each may now or in the future have to
      challenge or have set aside any arrangement relating to:

	 	 	 
		15.4.1 	
      the placing in a suspense account of any moneys or
      distributions received from the Subordinated Creditor or on account of the
      liability of the Subordinated Creditor under this Deed; and

	 	 	 
		15.4.2 	
      any other matter or thing regarding the order of
      enforcement of the Senior Security Documents and the priority of the
      application of the proceeds of such enforcement,

	 	 	 
			
      and the Borrower confirms that it does not have any right
      to enforce or sue in respect of any agreement, arrangement or
      understanding herein contained or to claim any right of estoppel in
      relation hereto.

	 	 	 
	16. 	
      PRESERVATION OF SUBORDINATED DEBT

	 	 	 
		
      The Subordinated Debt shall, solely as between the
      Borrower and the Subordinated Creditor, remain owing or due and payable in
      accordance with the terms of the Subordinated Documents and interest and
      default interest will accrue on missed payments accordingly.

	 	 	 
	17. 	
      POWER OF ATTORNEY

	 	 	 
		
      By way of security for the obligations of the
      Subordinated Creditor under this Deed, the Subordinated Creditor
      irrevocably appoints the Lender as its attorney to do anything which the
      Subordinated Creditor is required to do by this Deed but has failed to do.
      The Lender may delegate this power. The Subordinated Creditor ratifies and
      confirms and agrees to ratify and confirm all acts and things which any
      attorney mentioned in this Clause 17 does or purports to do in exercise of
      the powers granted by this Clause 17.

	 	 	 
	18. 	
      EXPENSES, DEFAULT INTEREST ETC

	 	 	 
	18.1 	
      Enforcement costs

	 	 	 
		
      The Borrower and the Subordinated Creditor shall,
      forthwith on demand, pay to the Lender the amount of all costs and
      expenses incurred by it in connection with the preservation or enforcement
      against the Borrower or the Subordinated Creditor (as the case may be) of
      any of the rights of the Lender against it under this Deed.

	 	 	 
	18.2 	
      Legal expenses and taxes

	 	 	 
		
      The costs and expenses referred to in Clause 18.1 above
      include, without limitation, the fees and expenses of legal advisers and
      any value added tax or similar tax, and are payable in the currency in
      which they are incurred.



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	18.3 	
      Default interest

	 	 	 	 
		18.3.1 	
      If the Subordinated Creditor fails to pay any amount
      payable by it under this Deed to the Lender, it must, on demand by the
      Lender, pay interest on the overdue amount from the due date up to the
      date of actual payment (both before and after judgment).

	 	 	 	 
		18.3.2 	
      Interest on an overdue amount is payable at a rate equal
      to the aggregate of:

	 	 	 	 
			(A) 	
      two per cent.;

	 	 	 	 
			(B) 	
      the rate quoted by the Lender to leading banks in the
      London interbank market on the relevant rate fixing day for the offering
      of deposits in the currency of the overdue amount during the period of
      non-payment;

	 	 	 	 
			(C) 	
      the cost of compliance with the requirements of the Bank
      of England, the Financial Services Authority or the European Central Bank
      (or, in any case, any successor authority) in relation to the overdue
      amount, as certified by the Lender.

	 	 	 	 
		18.3.3 	
      For the purpose of determining the relevant rate under
      Clause 18.3.2 above, the Lender may:

	 	 	 	 
			(A) 	
      select successive periods of any duration up to three
      months; and

	 	 	 	 
			(B) 	
      determine the appropriate rate fixing day for that
      period.

	 	 	 	 
		18.3.4 	
      Interest (if unpaid) on an overdue amount will be
      compounded at the end of the period selected by the Lender under Clause
      18.3.3 above but will remain immediately due and payable.

	 	 	 	 
		18.3.5 	
      Any interest accruing under this Clause 18 accrues from
      day to day and is calculated on the basis of the actual number of days
      elapsed and a year of 360 days or otherwise, depending on what the Lender
      determines is market practice for the currency of the amount
due.

	 	 	 	 
	18.4 	
      Certificates and Determinations

	 	 	 	 
		
      Any certification or determination by the Lender of a
      rate or amount under this Deed is, in the absence of manifest error,
      conclusive evidence of the matters to which it relates.

	 	 	 	 
	18.5 	
      No Deduction

	 	 	 	 
		
      All payments to be made by the Subordinated Creditor
      under this Deed shall be made without any set-off, counterclaim or equity
      and (subject to the following sentence) free from, clear of and without
      deduction for any taxes, duties, levies, imposts or charges whatsoever,
      present or future. If the Subordinated Creditor is compelled by the law of
      any applicable jurisdiction (or by an order of any regulatory authority in
      such jurisdiction) to withhold or deduct any sums in respect of taxes,
      duties, levies, imposts or charges from any amount payable to the Lender
      under this Deed or, if any such withholding or deduction is made in
      respect of any recovery from the Subordinated Creditor under this Deed,
      the Subordinated Creditor shall pay such additional amount so as to ensure
      that the net amount received by the Lender shall equal the full amount due
      to it under the provisions of this Deed (had no such withholding or
      deduction been made).



11 





	18.6 	
      Currency of Payment

	 	 	 	 
		
      The obligation of the Subordinated Creditor under this
      Deed to make payments in any currency shall not be discharged or satisfied
      by any tender, or recovery pursuant to any judgment or otherwise,
      expressed in or converted into any other currency, except to the extent
      that tender or recovery results in the effective receipt by a Finance
      Party of the full amount of the currency expressed to be payable under
      this Deed.

	 	 	 	 
	18.7 	
      Currency Indemnity

	 	 	 	 
		18.7.1 	
      If any sum due from the Subordinated Creditor under this
      Deed (a "Sum"), or any order, judgment or award given or made in
      relation to a Sum, has to be converted from the currency (the "First
      Currency") in which that Sum is payable into another currency (the
      "Second Currency") for the purpose of:

	 	 	 	 
			(A) 	
      making or filing a claim or proof against the
      Subordinated Creditor;

	 	 	 	 
			(B) 	
      obtaining or enforcing an order, judgment or award in
      relation to any litigation or arbitration proceedings; or

	 	 	 	 
			(C) 	
      applying the Sum in satisfaction of any amount due under
      this Deed,

	 	 	 	 
				
      the Subordinated Creditor shall, as an independent
      obligation, within three Business Days of demand, indemnify the relevant
      Finance Party against any cost, loss or liability arising out of or as a
      result of the conversion including any discrepancy between (A) the rate of
      exchange used to convert that Sum from the First Currency into the Second
      Currency and (B) the rate or rates of exchange available to that Finance
      Party at the time of its receipt of that Sum.

	 	 	 	 
		18.7.2 	
      The Subordinated Creditor waives any right it may have in
      any jurisdiction to pay any amount under this Deed in a currency or
      currency unit other than that in which it is expressed to be
    payable.

	 	 	 	 
	19. 	
      CHANGES TO THE PARTIES

	 	 	 	 
	19.1 	
      Successors and assigns

	 	 	 	 
		
      This Deed is binding on the successors and assigns of the
      parties hereto.

	 	 	 	 
	19.2 	
      Borrower

	 	 	 	 
		
      The Borrower may not assign or transfer any of its rights
      (if any) or obligations under this Deed.

	 	 	 	 
	19.3 	
      Subordinated Creditor

	 	 	 	 
		
      The Subordinated Creditor shall not:

	 	 	 	 
		19.3.1 	
      assign or dispose of, or create or permit to subsist any
      security or trust over, any of the Subordinated Debt owing to it or its
      proceeds or any interest in that Subordinated Debt or its proceeds, or any
      security therefor, to or in favour of any person or attempt to do any of
      the foregoing; or

	 	 	 	 
		19.3.2 	
      subordinate any of the Subordinated Debt owing to it or
      its proceeds to any sums owing by the Borrower to any person other than
      the Lender; or



12 





	 	19.3.3 	
      transfer by novation or otherwise any of its rights or
      obligations under the Subordinated Documents or this Deed to any
      person.




	19.4 	
      The Lender

	 	 	 	 
		
      The Lender may assign or otherwise dispose of all or any
      of its rights under this Deed in accordance with the Finance Documents to
      which it is a party.

	 	 	 	 
	20. 	
      STATUS OF BORROWER

	 	 	 	 
	20.1 	
      Priorities

	 	 	 	 
		
      The Borrower joins in this Deed for the purpose of
      acknowledging the priorities, rights and obligations recorded in this Deed
      and undertakes with each of the other parties hereto to observe the
      provisions of this Deed at all times and not in any way to prejudice or
      affect the enforcement of such provisions or do or suffer anything which
      would be inconsistent with the terms of this Deed.

	 	 	 	 
	20.2 	
      No rights

	 	 	 	 
		
      The Borrower shall not have any rights hereunder and none
      of the undertakings herein contained on the part of the Lender or the
      Subordinated Creditor are given (or shall be deemed to have been given)
      to, or for the benefit of, the Borrower.

	 	 	 	 
	21. 	
      LIABILITY OF LENDER

	 	 	 	 
		
      The Lender shall have no liability to the Borrower or the
      Subordinated Creditor for any omission or any act taken by it in
      connection with its rights, powers, duties or obligations under this
      Deed.

	 	 	 	 
	22. 	
      NOTICES

	 	 	 	 
	22.1 	
      Communications in writing

	 	 	 	 
		
      Any communication to be made under or in connection with
      this Deed shall be made in writing and, unless otherwise stated, may be
      given in person, by post or fax.

	 	 	 	 
	22.2 	
      Addresses

	 	 	 	 
		
      The address and fax number (and the department or
      officer, if any, for whose attention the communication is to be made) of
      each Party for any communication or document to be made or delivered under
      or in connection with this Deed is that identified with its name below or
      any substitute address, fax number or department or officer as any Party
      may notify to the others by not less than five Business Days'
    notice.

	 	 	 	 
	22.3 	
      Delivery

	 	 	 	 
		22.3.1 	
      Any communication or document made or delivered by one
      person to another under or in connection with this Deed will only be
      effective:

	 	 	 	 
			(A) 	
      if by way of fax, when received in legible form;
  or

	 	 	 	 
			(B) 	
      if by way of letter, when it has been left at the
      relevant address or five Business Days after being deposited in the post
      postage prepaid in an envelope addressed to it at that
  address,



13 





	 		
      and, if a particular department or officer is specified
      as part of its address details provided under Clause 22.2
      (Addresses), if addressed to that department or
    officer.

	 	 	 
	 	22.3.2 	
      Any communication or document to be made or delivered to
      the Lender will be effective only when actually received by the Lender and
      then only if it is expressly marked for the attention of the department or
      officer identified with the Lender's signature below (or any substitute
      department or officer as the Lender shall specify for this
  purpose).




	22.4 	
      English language

	 	 	 	 
		22.4.1 	
      Any notice given under or in connection with this Deed
      must be in English.

	 	 	 	 
		22.4.2 	
      All other documents provided under or in connection with
      this Deed must be:

	 	 	 	 
			(A) 	
      in English; or

	 	 	 	 
			(B) 	
      if not in English, and if so required by the Lender,
      accompanied by a certified English translation and, in this case, the
      English translation will prevail unless the document is a constitutional,
      statutory or other official document.




	23. 	
      PARTIAL INVALIDITY

	 	 	 
		
      If, at any time, any provision of this Deed is or becomes
      illegal, invalid or unenforceable in any respect under any law or any
      jurisdiction, neither the legality, validity or enforceability of the
      remaining provisions nor the legality, validity or enforceability of such
      provision under the law of any other jurisdiction will in any way be
      affected or impaired.

	 	 	 
	24. 	
      REMEDIES AND WAIVERS CUMULATIVE

	 	 	 
		
      The rights of the Lender under this Deed:

	 	 	 
		24.1.1 	
      are cumulative and not exclusive of its rights under the
      general law;

	 	 	 
		24.1.2 	
      may be exercised as often as necessary; and

	 	 	 
		24.1.3 	
      may be waived only in writing and specifically.

	 	 	 
			
      Delay in exercising or non-exercise of any such right is
      not a waiver of that right.

	 	 	 
	25. 	
      COUNTERPARTS

	 	 	 
		
      This Deed may be executed in any number of counterparts,
      and this has the same effect as if the signatures on the counterparts were
      on a single copy of this Deed.

	 	 	 
	26. 	
      GOVERNING LAW

	 	 	 
		
      This Deed is governed by English
law.



14 





	27. 	
      JURISDICTION

	 	 	 	 
	27.1 	
      Jurisdiction of English courts

	 	 	 	 
		27.1.1 	
      The courts of England have exclusive jurisdiction to
      settle any dispute arising out of or in connection with this Deed
      (including a dispute regarding the existence, validity or termination of
      this Deed) (a "Dispute").

	 	 	 	 
		27.1.2 	
      Subject to Clause 27.1.3 below, the Parties agree that
      the courts of England are the most appropriate and convenient courts to
      settle Disputes and accordingly neither the Borrower, an Obligor nor a
      Subordinated Creditor will:

	 	 	 	 
			(A) 	
      argue to the contrary; or

	 	 	 	 
			(B) 	
      take any proceedings relating to a Dispute in any
      jurisdiction other than England.

	 	 	 	 
		27.1.3 	
      This Clause is for the benefit of the Lender only. As a
      result the Lender shall not be prevented from taking proceedings relating
      to a Dispute in any other courts with jurisdiction nor from contending
      that such courts are appropriate and convenient. To the extent allowed by
      law, the Lender may take:

	 	 	 	 
			(A) 	
      proceedings in any other court; and

	 	 	 	 
			(B) 	
      concurrent proceedings in any number of
    jurisdictions.

	 	 	 	 
	27.2 	
      Service of process

	 	 	 	 
		
      Without prejudice to any other mode of service allowed
      under any relevant law, the Subordinated Creditor:

	 	 	 	 
		27.2.1 	
      irrevocably appoints [o] as its agent for service of
      process in relation to any proceedings before the English courts in
      connection with this Deed; and

	 	 	 	 
		27.2.2 	
      agrees that failure by a process agent to notify it of
      the process will not invalidate the proceedings
  concerned.



IN WITNESS whereof this Deed has been duly executed and
delivered as a deed on the date stated at the beginning of this Deed. 

15 




SIGNATORIES 

THE BORROWER 

EXECUTED AS A DEED by 
SMARTSWITCH NETHERLANDS
C.V. 
Represented by its Management Committee 

/s/ Herman
Kotze                                   

By: Herman Kotze 

Its: Sole Member of the Management Committee 

in the presence of: Signature of witness 

/s/ E C de
Villers                                     


Name of witness
(in BLOCK CAPITALS) 

EC de Villers 


Notice details for the purposes of Clause 22 

	Address of company: 	President Place 
	  	4th Floor 
	  	Cnr Jan Smuts Avenue and Bolton Road
  
	  	Rosebank 
	  	Johannesburg 2196 
	 	South Africa 
	  	  
	Fax: 	27 11 880 7080 
	  	  
	Attention: 	Mr Herman Kotze 


SIGNATURE PAGE TO DEED OF SUBORDINATION 

16 




THE SUBORDINATED CREDITOR 
EXECUTED AS A DEED by

NET1 UEPS TECHNOLOGIES, INC. 

/s/ Herman
Kotze                                   
By:
Herman Kotze 
Its: Chief Financial Officer 


Signature of witness 

/s/ E C de
Villers                                     


Name of witness
(in BLOCK CAPITALS) 

EC de Villers 

Notice details for the purposes of Clause 22 

Address of company:

President Place 
4th Floor 
Cnr. Jan Smuts
Avenue and Bolton Road 
Rosebank 
Johannesburg 2196 
South Africa


	Fax: 	27 11 880 7080 
	 	 
	Attention: 	Mr. Herman Kotze 


SIGNATURE PAGE TO DEED OF SUBORDINATION 

17 





	THE LENDER 	  	 
	SIGNED by 	) 	 
	  	) 	 
	for and on behalf of 	) 	 
	INVESTEC BANK (UK) 	) 	 
	LIMITED 	  	 


/s/ Charles
Stott                                     
Charles
Stott 
Authorized Signatory 

/s/ Michael
Kurland                               

Michael Kurland 
Authorized Signatory

 

Notice details for the purposes of Clause 22 

Address of company:

2 Gresham Street 
LONDON 
EC2 V 7QP 


	Fax: 	+44 (0)20 597 4070 
	 	 
	Attention: 	Kim Boatwright 



18