instruction:
In this task, you're given a passage that represents a legal contract or clause between multiple parties. Your job is to write questions that ask the basic details corresponding to the legal contracts or clauses. Avoid questions that can be answered correctly without actually understanding the paragraph, and which might have multiple answers. The answer to each question should be unambiguous.
question:
-1 -                                            TELKOM CONTRACT No. 076C/01   LICENCE AND MAINTENANCE AGREEMENT   entered into by and between   SYSTEMS APPLICATIONS PRODUCTS (AFRICA) (PTY) LIMITED   (SAP AFRICA)   a company incorporated in accordance with the laws of the Republic of South Africa   with offices at SAP Business Park, 1 Woodmead Drive, Woodmead, Sandton   and   TELKOM SOUTH AFRICA LIMITED   (TELKOM)   a company incorporated in accordance with the laws of the Republic of South Africa with   its head office at 152 Proes Street, Pretoria



- 2 -                                             TELKOM CONTRACT No. 076C/01   1.     RECORDAL   It is recorded that:   1. 1.     SAP AFRICA wishes to grant to TELKOM and TELKOM wishes to accept from   SAP AFRICA a licence to use the SOFTWARE (as defined in clause 2. 3. 11),   upon the terms and conditions hereinafter set forth.   1. 2.     The SOFTWARE to be licensed in terms hereof will enable TELKOM to establish,   manage and operate an Internet-based business platform for TELKOM'S e-   commerce exchange, that is, a Marketplace as defined in clause 3. 9.   1. 3.    The parties record their agreement in this document that, upon signature by the   party signing last in time, shall supercede and prevail over all other arrangements   and agreements between them as to its subject matter.   2.     INTERPRETATION AND DEFINITIONS   In this AGREEMENT:   2. 1.     clause headings are for convenience and shall not be used in its interpretation;   2. 2.     unless the context clearly indicates a contrary indication -   2. 2. 1.         an expression which denotes -   2. 2. 1. 1.             any gender includes the other genders;   2. 2. 1. 2.             a natural person includes an artificial person and vice versa;   2. 2. 1. 3.             the singular includes the plural and vice versa;



- 3 -                                             TELKOM CONTRACT No. 076C/01   2. 3.      the following expressions shall bear the meanings assigned to them below and   cognate expressions bear corresponding meanings -   2. 3. 1.         AFFILIATE means a company located in the TERRITORY that is a   subsidiary of TELKOM as defined in the Companies Act of 1973, as   amended, provided that should any such entity cease, for whatever reason,   to be a subsidiary of TELKOM, then it shall ipso facto cease to be an   AFFILIATE for the purposes of this AGREEMENT and the provisions of   clause 6. 4 shall apply to such entity;   2. 3. 2.        BUSINESS THIRD PARTIES means those persons or entities who are   authorised by TELKOM to access and/or USE the SOFTWARE in terms of   formal arrangements that TELKOM has with such persons or entities;   2. 3. 3.        COMMERCE ONE INC.  means a company incorporated in accordance   with the Laws of Switzerland with its head offices in Zurich;   2. 3. 4.        DESIGNATED SITE means those facilities of TELKOM located in the   TERRITORY in which one or more DESIGNATED UNITS are located and   which initially is/are defined in annexure 1 to this AGREEMENT or, for   additional DESIGNATED SITES, as may be agreed upon in writing by the   parties;   2. 3. 5.        DESIGNATED UNIT means an individual computer server located at a   DESIGNATED SITE upon which the SOFTWARE is installed. Each   DESIGNATED UNIT must be approved by SAP AFRICA as compatible with   the SOFTWARE and must be identified in annexure 1 hereto or, for   additional DESIGNATED UNITS as may be agreed upon in writing by the   parties;



- 4 -                                             TELKOM CONTRACT No. 076C/01   2. 3. 6.       DOCUMENTATION  means SAP AFRICA's standard DOCUMENTATION   in machine readable format in any medium that is delivered to TELKOM   under this AGREEMENT, including SAP AFRICA's standard manuals,   program listings, data models, flow charts, logic diagrams, input and output   forms, functional specifications, instructions and complete or partial copies   of the aforegoing;   2. 3. 7.       PROGRAM CONCEPTS means the concepts, techniques, ideas and   know-how embodied and expressed in any computer programs or modules   included in the SOFTWARE, including the structure, sequence and   organisation of such programs and modules;   2. 3. 8.       PROPRIETARY INFORMATION means: -   2. 3. 8. 1.           with respect to SAP AFRICA, the SOFTWARE and   DOCUMENTATION and any complete or partial copies thereof, the   PROGRAM CONCEPTS and any other information identified or   reasonably identifiable as confidential and PROPRIETARY   INFORMATION of SAP, SAP AG, or each of their respective   licensors, whether marked with proprietary legend or not (SAP   AFRICA'S PROPRIETARY INFORMATION);   2. 3. 8. 2.           with respect to TELKOM, information identified or reasonably   identifiable, as the confidential and PROPRIETARY INFORMATION   of  TELKOM, whether marked with proprietary legend or not   (TELKOM's PROPRIETARY INFORMATION),   excluding any part of the SAP's or TELKOM's PROPRIETARY   INFORMATION which: -



- 5 -  TELKOM CONTRACT NO. 076C/01   2. 3. 8. 2. 1.        is, or becomes, publicly available through no act or failure of the         other party; or   2. 3. 8. 2. 2.        was or is rightfully acquired by the other party from a source other         than the disclosing party prior to receipt from the disclosing party;         or   2. 3. 8. 2. 3.        becomes independently available to the other party as a matter of         right;   2. 3. 9.              RELEASE means each issue of the SOFTWARE by SAP AG and its         licensors that incorporates the most recent technological functionality and is         identified by the numeral to the left of the decimal point (e. g. 2. 0);   2. 3. 10.            SAP AG means SAP Aktiengesellschaft Systeme, Anwendungen,         Produkte in der Datenverarbeitung, a German corporation, with its head         office located in Walldorf, Germany. For the purposes of this         AGREEMENT, and if required by the context, the phrase SAP AG shall be         deemed to include its licensors, particularly, COMMERCE ONE INC.. Inc, a         company incorporated in accordance with the laws of Switzerland with its         head office at Zurich, Switzerland;   2. 3. 11.         SOFTWARE means:   2. 3. 11. 1.                the SOFTWARE specified in annexure 1 hereto, in machine - or          human - readable form that is licensed to TELKOM hereunder;   2. 3. 11. 2.                any RELEASES, VERSIONS or correction levels of the          SOFTWARE; and



- 6 -                                             TELKOM CONTRACT No. 076C/01   2. 3. 11. 3.          any complete or partial copies or replacements of any of the   aforegoing;   2. 3. 11. 4.          TERRITORY means, for the purposes of USING the SOFTWARE,   all countries in. AFRICA;   2. 3. 11. 5.          THIRD-PARTY DATABASE means a third party proprietary   database or databases or portions thereof that are listed in annexure   1 and such other THIRD PARTY DATABASES that TELKOM may   require in the future;   2. 3. 11. 6.          TRANSACTION USE means USE including remote USE and   access to the SOFTWARE by any method by TELKOM or third   parties which results in a transaction as measured by the processor   incorporated in the SOFTWARE;   2. 3. 11. 7.         USE means to load, execute, employ, utilise, access, store process   information that results in TRANSACTION USE or display of the   SOFTWARE within the TERRITORY. USE is deemed to occur where   any such USE occurs by TELKOM, its AFFILIATES or their   respective employees or BUSINESS THIRD PARTIES authorised by   TELKOM in terms of formal arrangements, to USE the SOFTWARE   and, for the purposes of this AGREEMENT, TELKOM shall permit the    SOFTWARE to be USED only within the TERRITORY;   2. 3. 11. 8.          VERSIONS means each issue of each RELEASE of the   SOFTWARE developed by SAP AG, or its licensors, which has   incorporated further development work within the technology of that   RELEASE.



- 7 -  TELKOM CONTRACT No. 076C/01   2. 4.  Any reference to any legislation is to such legislation at the signature date as     amended or re-enacted from time to time.   2. 5.  All schedules and annexures to this AGREEMENT shall be deemed to be     incorporated in, and form part of, this AGREEMENT.   2. 6.  If any of the aforesaid definitions contains a substantive provision, effect shall be     given thereto as if it were contained in the body of this AGREEMENT.   2. 7.  Where any time period is stipulated in days, then same shall exclude Saturdays,     Sundays and all statutory public holidays provided that any reference in annexure     2 to days, shall include Saturdays, Sundays and statutory public holidays.   2. 8.  Should any provision contain a provision for the benefit of a third party, whether     named or not, then such third party shall be entitled to accept the benefits     conferred in terms thereof, within 30 days of being notified of such benefit. It is     recorded for the avoidance of doubt that the provisions of this AGREEMENT shall     not in the normal course, be disclosed other than to the parties hereto and their     respective employees.   3.  LICENSE   3. 1.  Subject to the provisions of this AGREEMENT, and with effect from the date   when the party signing last in time appends its signature to this agreement (the   effective date), and enduring in perpetuity unless terminated as provided for   elsewhere in this AGREEMENT, SAP AFRICA grants, and TELKOM accepts a   non-exclusive, non-transferable licence to USE the SOFTWARE,   DOCUMENTATION and other SAP AFRICA PROPRIETARY INFORMATION at   the specified DESIGNATED SITE within the TERRITORY.



- 8 -  TELKOM CONTRACT NO. 076C/01   3. 2.     TELKOM agrees that, subject to the provisions of clause 3. 9, the license granted   in terms hereof does not permit TELKOM to:   3. 2. 1.         USE the SOFTWARE and THIRD-PARTY DATABASE in a manner that   allows access to, and USE, (including TRANSACTION USE) directly or   indirectly, to the SOFTWARE by third parties (other than BUSINESS   THIRD PARTIES), whether on TELKOM'S hardware or otherwise; or   3. 2. 2.        sublicense the SOFTWARE to any person or entity in a manner that allows   such person or entity to provide the same or similar services as those   provided by TELKOM utilising the SOFTWARE alone.   3. 3.     TELKOM shall install the SOFTWARE only on the DESIGNATED UNIT located at   the DESIGNATED SITE as agreed to by the parties in annexure 1 hereto.   TELKOM further agrees to USE the SOFTWARE only in accordance with the   DOCUMENTATION or as may otherwise be agreed in writing by SAP AFRICA,   which may not be unreasonably withheld. TELKOM may connect multiple   application servers to each DESIGNATED UNIT and connect a network of   computer terminals and workstations to the application servers. TELKOM may   install the software on another DESIGNATED UNIT for disaster recovery and   business continuity purposes. It is recorded for the avoidance of doubt that   TELKOM shall not be entitled to install the SOFTWARE on another   DESIGNATED UNIT or other hardware situated at another site within the   TERRITORY for the purposes of establishing and operating a Marketplace as   defined in clause 3. 9.   3. 4.     TELKOM may transfer the SOFTWARE from one DESIGNATED UNIT to another   at a licensed DESIGNATED SITE upon prior written notice to SAP AFRICA. The



- 9 -  TELKOM CONTRACT No. 076C/01   SOFTWARE must be deleted in its entirety within 90 days from such transfer   from the DESIGNATED UNIT no longer in use.   3. 5.  If TELKOM is unable to use the SOFTWARE on a DESIGNATED UNIT because   of conditions beyond its control, TELKOM may temporarily install the   SOFTWARE on other equipment located within the TERRITORY until such   condition is corrected, provided that TELKOM shall ensure that:   3. 5. 1.  the temporary installation shall not impair TELKOM'S ability to prevent any        third party's USE of the SOFTWARE; and   3. 5. 2.  TELKOM shall notify SAP AFRICA in writing within 30 days of the location        of such temporary installation.   3. 6.  TELKOM is licensed to install at the DESIGNATED SITE no more than 1 (one)   copy of the SOFTWARE on the DESIGNATED UNIT utilised for testing and   backup purposes The DESIGNATED UNIT utilised for testing and backup   purposes of the SOFTWARE, must be of the same type as those used at the    DESIGNATED SITE for USE. Only 1 (one) copy of the SOFTWARE is licensed   for USE on the DESIGNATED UNIT at the DESIGNATED SITE, unless   otherwise agreed upon in writing by SAP AFRICA.   3. 7.  Subject to the provisions of the Escrow Agreement embodied in annexure 3   hereto, TELKOM shall have no right to claim or to be supplied with the basis   source code or the production and maintenance DOCUMENTATION for the   SOFTWARE, except as may otherwise be agreed in writing by the parties hereto   and by SAP AG.



- 10 -  TELKOM CONTRACT NO. 076C/01   3. 8.   Unless agreed by the parties to the contrary, TELKOM may only USE the   program modules referred to in the definition of SOFTWARE even if TELKOM is   technically able to USE other modules from the SOFTWARE supplied.   3. 9.   It is recorded that the SOFTWARE licensed in terms of this AGREEMENT, and   its functionality, enables, and is to be USED to establish, operate and administer   a central Internet/Web based market or e-commerce exchange (a   Marketplace), for USE by TELKOM, it's employees and BUSINESS THIRD   PARTIES for the purposes of:   3. 9. 1.   buying or selling, or offering to buy or sell, products and/or services;   3. 9. 2.   providing or being supplied with, or offering to provide or supply,   information and/or accessing or USING the SOFTWARE or any   functionality thereof to TELKOM or to each other, that may or may not   result in TRANSACTION USE. Accordingly, TELKOM is entitled to access   and USE the SOFTWARE and to allow access to, and USE of, the   SOFTWARE for such purposes and within such functionality.   3. 10.   TELKOM and its AFFILIATES shall only allow USE of the SOFTWARE and SAP   PROPRIETARY INFORMATION by their respective employees, authorised   representatives and persons and entities authorised by TELKOM in terms of   formal arrangements and who are required as part of such arrangements to   assist TELKOM or an AFFILIATE, to USE or enhance the USE of TELKOM'S or   an AFFILIATE'S USE of the SOFTWARE.   3. 11.   Unless the parties should agree otherwise, TELKOM may make 1 (one) copy of   the SOFTWARE at the DESIGNATED SITE for archival purposes and such   number of backup copies of the SOFTWARE consistent with TELKOM'S normal   periodic backup procedures. Such copies must be held in a safe place for use



- 1 1 -                                             TELKOM CONTRACT No. 076C/01   only in the event of the SOFTWARE in regular use being rendered unusable or   inoperable. TELKOM shall notify SAP AFRICA should TELKOM need to USE   such backup or archival copy/ies.   3. 12.    The DOCUMENTATION and SAP AFRICA PROPRIETARY INFORMATION may   not be copied by TELKOM except for USE by TELKOM or AFFILIATE.   3. 13.    TELKOM shall not alter or erase SAP AFRICA's, SAP AG's and any of their   respective licensors' copyright, trademark, service marks, logos and other    proprietary notices on any complete or partial copies of the SOFTWARE,   DOCUMENTATION or SAP AFRICA's PROPRIETARY INFORMATION.   3. 14.     It is recorded that the SOFTWARE requires those THIRD-PARTY DATABASES   listed in annexure 1 which, unless the parties should agree otherwise, shall be   acquired and licensed by TELKOM directly from THIRD-PARTY DATABASE   licensors approved by SAP AFRICA, which approval shall not unreasonably be   withheld. SAP AFRICA confirms that the SOFTWARE shall perform and conform   to its functional specifications on all THIRD-PARTY DATABASES in respect of   which it has given its approval aforesaid. Accordingly, the licence granted in   terms of this AGREEMENT, shall be restricted to such extent if any, required to   implement those restrictions imposed on TELKOM directly by such THIRD-   PARTY DATABASE licensors. This AGREEMENT and the license granted in   terms hereof shall be suspended, if for any reason:   3. 14. 1.      TELKOM fails to obtain and/or maintain a licence from SAP AFRICA or       such THIRD PARTY DATABASE licensor; or   3. 14. 2.      TELKOM'S database licence/s terminates prior to the termination of this       AGREEMENT and is not replaced with a suitable alternative.



-12-  TELKOM CONTRACT No. 076C/01   3. 15.      It is recorded for the avoidance of doubt that, provided TELKOM is receiving and   paying for Maintenance Service as contemplated in clause 9, SAP AFRICA shall   provide Maintenance Services in accordance with the provisions of clause 9 and   annexure 2, in respect of the third party software that is licensed by SAP   AFRICA to TELKOM in terms of this AGREEMENT provided that SAP AFRICA   shall not provide such Maintenance Services in respect of any THIRD PARTY   DATABASE software that is not licensed in terms of this AGREEMENT.   4.    DELIVERY AND INSTALLATION   4. 1.     Delivery:   SAP AFRICA shall deliver 1 (one) copy of the SOFTWARE and the   DOCUMENTATION, in machine-readable format to TELKOM'S DESIGNATED   1SITE within 4 (four) weeks from the effective date (delivery). The   DOCUMENTATION shall be delivered in the language version requested by   TELKOM provided that such language version is commercially available.   4. 2.     Installation and Support Services:   4. 2. 1.     unless agreed otherwise in writing, TELKOM shall be responsible for   installation of the SOFTWARE. TELKOM shall be responsible for   configuring and installing any required disk storage systems, network   software, application servers, DESIGNATED UNITS and computer   terminals and workstations prior to installation of the SOFTWARE. It is   recorded that upon TELKOM's request and on terms to be agreed upon   separately, in writing, SAP AFRICA will provide installation services, pre-   installation support, installation support, configuration, training and   consulting services in respect of the SOFTWARE;



- 1 3 -  TELKOM CONTRACT NO. 076C/01   4. 2. 2      TELKOM shall test each module of the SOFTWARE extensively in its live   business environment to determine that it appears to be free of any major   defects and that it is suitable for TELKOM's application before TELKOM   USES the SOFTWARE within and for the benefit of its business.   4. 3.    TELKOM shall be entitled to utilise or operate the SOFTWARE on different   operating software for no additional licence fee or consideration but TELKOM   shall be liable for any installation, configuration or other costs incurred in   changing such operating software.   5.    LICENSE AND REVENUE SHARING FEES AND PAYMENT TERMS   5. 1.     Licence Fee: In consideration for the licence granted hereunder, TELKOM shall   pay to SAP AFRICA the licence fee as stipulated in annexure 1 (the Licence   Fee). The Licence Fee is priced in US dollars (USD). Forthwith after the   effective date, SAP AFRICA shall invoice TELKOM for payment of the License   Fee. SAP AFRICA shall convert the agreed License Fee, expressed in USD, into   ZAR using the USD: ZAR rate of exchange ruling at the close of business on the   day immediately preceding the date of invoice. For the purposes of this   AGREEMENT, the ruling rate shall be the buy rate for USD's offered by SAP   AFRICA'S bankers on that day. The Licence Fee expressed in ZAR as   aforesaid, shall be paid by TELKOM within 30 days of receipt by TELKOM of the   invoice.   5. 2.     In addition to the Licence Fee, TELKOM shall pay to SAP AFRICA an amount   equal to that percentage stipulated in 5. 3 (the REVENUE SHARE   PERCENTAGE), of TELKOM'S total gross revenue that TELKOM earns or   derives from commercial exploitation of the SOFTWARE licensed in terms hereof.



-14 -                                             TELKOM CONTRACT No. 076C/01   (the REVENUE SHARE FEE). For the purposes of calculating the REVENUE   SHARE FEE payable to SAP AFRICA,  the total gross revenue earned or   derived by TELKOM from the USE of the SOFTWARE:   5. 2. 1.       shall exclude:   5. 2. 1. 1.         VAT and other Government taxes raised on such revenue;   5. 2. 1. 2.         any credits, if any, that TELKOM may grant on a formal basis, to a       BUSINESS THIRD PARTIES;   5. 2. 1. 3.         royalties or fees that may be payable by TELKOM to a bona fide third       party who provides, in terms of formal arrangements with TELKOM,       additional functionality, enhancement or value add services to, or in       respect of, the SOFTWARE; any revenue earned or derived by       TELKOM pursuant to TELKOM providing goods and/or services in a       manner that does not USE the SOFTWARE; and   5. 2. 1. 4.         any other type of cost or charge that SAP AFRICA and TELKOM may       expressly agree shall be excluded;   5. 2. 2.              shall include the following amounts payable to TELKOM by BUSINESS          THIRD PARTIES for:   5. 2. 2. 1.         all charges and fees for accessing the Marketplace, any value add       services, any information, access to, or USE of, the SOFTWARE;   5. 2. 2. 2.         regular or once - off subscription fees for access to, or USE of, the       SOFTWARE, or the Marketplace or any information in respect       thereof;



-15- TELKOM CONTRACT No. 076C/01    5. 2. 2. 3.     value add services that SAP AFRICA and it's licensors may provide to   TELKOM and/or BUSINESS THIRD PARTIES USING, or in respect   of, the SOFTWARE and/or the Marketplace;   5. 2. 2. 4.      value added services that TELKOM may provide to BUSINESS   THIRD PARTIES USING or in respect of the SOFTWARE and/or the   Marketplace; and   5. 2. 2. 5.      any other fee or charge that TELKOM and SAP AFRICA may in the   future agree, should be included in the total gross revenue.   Where REVENUE SHARE is levied from a Net Market Maker connected to the   TELKOM Marketplace, then, the cumulative REVENUE SHARE shall not exceed   the REVENUE SHARE PERCENTAGE.   5. 3    For the period commencing from the effective date and ending February 2002,   the REVENUE SHARE PERCENTAGE shall be 10%. For the financial year   commencing 01 March 2002 and thereafter until agreed otherwise, the   REVENUE SHARE PERCENTAGE shall be 10% provided that should the   percentage of TELKOM'S direct and indirect procurement expenditure that is   transacted USING the SOFTWARE equal those percentage ranges stipulated   below, then, the REVENUE SHARE PERCENTAGE shall be decreased to the   corresponding percentage:       Percentage of TELKOM'S procurement USING SOFTWARE       Between 60% and 79%      80% or greater        9%        8%



- 1 6 -  TELKOM CONTRACT No. 076C/01   5. 4    The REVENUE SHARE FEE shall be payable quarterly in arrears 45 days after   the end of each quarter for the duration of this AGREEMENT.   5. 5    Should TELKOM fail to pay the REVENUE SHARE FEE, such failure shall not   effect TELKOM'S rights to USE the SOFTWARE but SAP AFRICA shall be entitled to   separately claim such payments from TELKOM as provided for hereinabove.   5. 6    TELKOM shall keep accurate records and accounts as are reasonably necessary   to verify TELKOM'S compliance with its' obligations in respect of the REVENUE   SHARE FEE. For the duration of this AGREEMENT, TELKOM shall within 3   months after expiry of its financial year - end furnish to SAP AFRICA a certificate   by TELKOM'S auditors, certifying the gross revenue earned by TELKOM or   derived by TELKOM as calculated in accordance with clause 5. 2. SAP AFRICA   shall repay to TELKOM or TELKOM shall pay to SAP AFRICA, as the case may   be, any overpayment or underpayment respectively.   5. 7    Referral Fees   TELKOM shall be entitled for the duration of this AGREEMENT, to market, at   prices and on terms and conditions determined by SAP AFRICA and its licensors   as being applicable to potential buyers. Should TELKOM be the effective cause   of the sale and licensing to any person or entity, of the following products, then   TELKOM shall be entitled to receive from the licensor of such product, a referral   fee equal to 10 % of the agreed license fee of each such product:   5. 7. 1      Net Market Maker;   5. 7. 2      Enterprise Buyer (Professional); and/or   5. 7. 3      Private Exchange.



-17-                                             TELKOM CONTRACT No. 076C/01   5. 8     TELKOM shall invoice and recover from the licensee of such products the   full license fee thereof and TELKOM shall pay to SAP Africa an amount   equal to such license fee less the aforesaid referral fee.   5. 9      The Revenue Share Fee and other related commercial terms of this   AGREEMENT shall be reviewed to market by the parties upon each   anniversary of this AGREEMENT in an endeavour to agree upon any   increases or decreases thereto. The parties acknowledge that the market   for the SOFTWARE in South Africa is limited and that therefor it may be   difficult to ascertain market conditions for the purposes of reviewing such   commercial terms. Accordingly, the parties shall take cognisance of market   conditions in other countries where the SOFTWARE is being used. Should   the parties be unable to agree upon any such amendments within 30 days   from the end of each year if any, then such dispute shall be referred for   determination by the Arbitration Foundation of Southern Africa (AFSA) in   accordance with the rules of AFSA and to an arbitrator appointed by the   Chairperson of AFSA upon application by either party. Except in the case   of manifest error, the arbitrators' ruling shall be final and binding upon the   parties but shall be without prejudice to a party's other rights and   obligations arising from the AGREEMENT.   6.    DURATION AND TERMINATION   6. 1.      Duration:   The licence granted hereunder shall become effective upon execution of this   AGREEMENT by both parties and shall endure indefinitely unless terminated   under clause 6. 2.



-18 -                                             TELKOM CONTRACT No. 076C/01   6. 2.     Termination:   This AGREEMENT and the licence granted hereunder shall terminate should any   of the following events occur:   6. 2. 1.        30 (thirty) days after TELKOM gives SAP AFRICA written notice of   TELKOM's wish to terminate this AGREEMENT for any reason. Any such   termination shall be subject to accrued rights and obligations but only after   payment of all Licence and Maintenance Fees then due and owing; or   6. 2. 2.           Subject to the provisions of this AGREEMENT, should either party (the          defaulting party) breach a material obligation arising from this          AGREEMENT and remain in breach, notwithstanding receipt of written          notice from the other party (the innocent party) affording the defaulting          party 20 days to remedy its breach, then the innocent party shall be entitled          to terminate this AGREEMENT alternatively, to claim specific performance          of the defaulting party's obligations without prejudice to the innocent party's          rights to claim damages for such breach.   6. 3.     No Refund:   Subject to, and without prejudice to, the provisions of clauses 6. 2. 2, 10 and 11,   should this AGREEMENT be terminated for whatever reason, then TELKOM   shall not be entitled to any refund of any of the Licence Fee payments or portions   thereof made by TELKOM other than Maintenance Fees that may have been   paid in advance.   6. 4.     Duties upon Termination:



- 19 -  TELKOM CONTRACT NO. 076C/01   Upon any termination hereunder, TELKOM and its AFFILIATES shall immediately   cease USE of the SOFTWARE, DOCUMENTATION, THIRD-PARTY DATABASE   and other SAP AFRICA PROPRIETARY INFORMATION and shall irretrievably   delete and remove such items from all DESIGNATED UNITS, application   servers, computer terminals, workstations, data files and DESIGNATED SITES.   Within 30 (thirty) days after any termination, TELKOM shall deliver to SAP   AFRICA, at the latter's expense, (adequately packaged and insured for safe   delivery) or, at SAP AFRICA'S request, destroy, all copies of SAP AFRICA's   PROPRIETARY INFORMATION in every form. TELKOM shall irretrievably erase   the SOFTWARE, and DOCUMENTATION, from any THIRD-PARTY DATABASE   and SAP AFRICA's PROPRIETARY INFORMATION from any storage media.   TELKOM agrees that an officer of TELKOM with the express authority to make   such a representation, shall certify in writing to SAP AFRICA that it and each of   its AFFILIATES has performed the foregoing. Within 3 months after any   termination, SAP AFRICA shall at its' cost return TELKOM'S PROPRIETARY   INFORMATION to TELKOM.   7.    PROPRIETARY RIGHTS   7. 1.    TELKOM acknowledges that ownership of and title in and to all intellectual   property rights, including patent, trademark, service mark, copyright and trade   secret rights in SAP'S AFRICA'S PROPRIETARY INFORMATION are and shall   remain vested in SAP AFRICA and SAP AG and their respective licensors.   TELKOM acquires only the right to USE the SOFTWARE, SAP AFRICA'S   PROPRIETARY INFORMATION under the terms and conditions of this   AGREEMENT and does not acquire any ownership, rights or title in or to the   SOFTWARE nor to SAP AFRICA'S PROPRIETARY INFORMATION.



- 20 -  TELKOM CONTRACT NO. 076C/01   7. 2.    TELKOM shall not itself, nor through any third party copy, translate, disassemble,   or decompile, nor create or attempt to create, by reverse engineering or   otherwise, the source code from the object code of the SOFTWARE licensed   hereunder or use it to create a derivative work.   7. 3.    TELKOM shall not remove any proprietary, copyright, trademark, or service mark   legend from the SOFTWARE, DOCUMENTATION or SAP AFRICA'S   PROPRIETARY INFORMATION.   7. 4.    TELKOM shall maintain a log of the number and location of all originals and   copies of the SOFTWARE. The inclusion of a copyright notice on any portion of   the SOFTWARE, DOCUMENTATION or SAP AFRICA'S PROPRIETARY   INFORMATION shall not cause, or be construed to cause, it to be a published   work.   7. 5.    Subject to the provisions of clause 8. 1 that expressly provide otherwise, all   modifications and extensions to the SOFTWARE and DOCUMENTATION shall   be considered part of the SOFTWARE and DOCUMENTATION for purposes of   this clause 7.   7. 6.    In order to protect the rights of SAP AFRICA and its licensors and TELKOM, in   and to their respective PROPRIETARY INFORMATION, SAP AFRICA and   TELKOM agree that neither party shall, without the other party's prior written   consent, disclose, provide, or make available any of the PROPRIETARY   INFORMATION of the other party in any form to any person, except to bona fide   employees, officers, directors, or consultants of such party whose access is   necessary to enable such party to exercise its rights hereunder. Each party   agrees that prior to disclosing any PROPRIETARY INFORMATION of the other   party to any such other person, it will obtain from such other person, a written



- 21 -  TELKOM CONTRACT NO. 076C/01   acknowledgement that he will be bound by the same terms as specified in this   clause 7 with respect to the either party's PROPRIETARY INFORMATION.   7. 7.     TELKOM and SAP AFRICA acknowledge that any disclosure to third parties of   PROPRIETARY INFORMATION may cause immediate and irreparable harm to   the owner of the disclosed PROPRIETARY INFORMATION. Accordingly, each   party agrees to take all reasonable steps and the same protective precautions   and measures to protect the other party's PROPRIETARY INFORMATION from   disclosure to third parties as it would take with its own proprietary and confidential   information.   8.    MODIFICATIONS AND EXTENSIONS:   8. 1.     TELKOM may make modifications and extensions to the SOFTWARE for use on   the DESIGNATED UNIT(S) under the terms set forth in this clause 8.   8. 2.     In the event that TELKOM develops any extension or modification (hereinafter   referred to as TELKOM extension or TELKOM modification) to the   SOFTWARE, TELKOM shall have all rights, title and interest in such TELKOM   extension or TELKOM modification subject to SAP AFRICA'S rights in the   SOFTWARE. TELKOM agrees, however, that such TELKOM extension or   TELKOM modification will be used solely in connection with TELKOM and its   AFFILIATES' business operations and that such TELKOM extension or TELKOM   modification will not be marketed, licensed or sublicensed, sold, assigned, or   otherwise transferred or made available to any third party or other entity, without   the express prior written consent of SAP AFRICA. TELKOM hereby grants SAP   AFRICA the right of first refusal to any licence to, or assignment of, such   TELKOM extension or TELKOM modification and TELKOM agrees not to dispose.



- 22 -  TELKOM CONTRACT NO. 076C/01   of or license, its rights thereto to any third party for a consideration not less than,   and upon other terms not less favourable than those initially offered to SAP   AFRICA.   8. 3.   In the event that SAP AFRICA develops jointly with TELKOM for universal   application and jointly funds with TELKOM, any extension or modification to the   licensed SOFTWARE, then save as may otherwise be agreed upon in writing by   SAP AFRICA and TELKOM, such extensions or modifications will be the joint   property of SAP AFRICA and TELKOM provided that   8. 3. 1.    Neither SAP AFRICA nor TELKOM will grant to any third party, either   expressly or impliedly, any rights, title, interest in, or licences to, such jointly   developed modification or extension. It is recorded that TELKOM shall be   entitled to USE such modification and extension on the DESIGNATED   UNIT(S) at the DESIGNATED SITE(S) in accordance with the provisions of   this AGREEMENT.   8. 3. 2.    8. 4.   The parties hereto agree that the granting of any rights, title or interest to   TELKOM in any extension or modification (including TELKOM extensions and   TELKOM modifications) shall not be construed by the parties hereto or any court   of law to mean that SAP AFRICA has granted or given up any rights, title, or   interest in or to SAP AFRICA'S PROPRIETARY INFORMATION or any part   thereof.   8. 5.   TELKOM agrees that it will not modify any third party SOFTWARE provided in   terms of this AGREEMENT, unless expressly authorised in writing by such third   party vendor and SAP AFRICA.



- 23 -  TELKOM CONTRACT No. 076C/01   8. 6.     During such time as SAP AFRICA provides maintenance service to TELKOM in   respect of the SOFTWARE, TELKOM shall not make modifications to the   SOFTWARE without the prior written consent of SAP AFRICA which shall not be   unreasonably withheld.   8. 7.     Notwithstanding anything to the contrary contained herein and without prejudice   to SAP AFRICA'S right of pre- emption provided for in clause 8. 2, should a party   (the acquiror) wish to acquire for itself only, the rights (and accompanying   obligations) in and to the jointly developed and funded MODIFICATION OR   EXTENSION, then the acquiror shall pay to the other party (the divesting party)   an amount equal to the market value of such modification or extension.   9.    MAINTENANCE   9. 1     SAP AFRICA shall provide maintenance services in respect of the SOFTWARE   in accordance with the provisions of this AGREEMENT and annexure 2 hereto   (Maintenance Service). Maintenance Service by SAP AFRICA shall, unless   expressly agreed otherwise in writing, be provided only to the DESIGNATED   SITE as specified in annexure 1. Maintenance Service includes the delivery of   RELEASES and VERSIONS, support via telephone, the correction of defects,   SAP AFRICA'S remote support on-line SOFTWARE services, and those other   services as set out in annexure 2. It is conditional upon TELKOM receiving   Maintenance Service that TELKOM must make all required remote support and   connections to the DESIGNATED UNIT, at its expense, as reasonably requested   by SAP AFRICA. It is recorded that, unless the parties should agree otherwise,   such remote access shall be by a dial - up facility only.   9. 2     The Maintenance Services to be provided by SAP AFRICA shall not include any   services other than those contemplated in clause 9. 1 and those set out in



- 24 -                                             TELKOM CONTRACT No. 076C/01   annexure 2. Maintenance Services will be offered only for the current VERSION   and RELEASE and the immediately preceding VERSION and RELEASE. SAP   AFRICA shall use its best endeavours to provide Maintenance Services in   respect of earlier VERSIONS and/or RELEASES provided that should SAP   AFRICA and its licensors incur material costs in supporting such prior   RELEASES and/or VERSIONS, then the parties shall negotiate with each other,   observing the principles of good faith, to agree upon additional maintenance fees   payable by TELKOM in respect of such prior RELEASES and/or VERSIONS.   9. 3    Upon TELKOM'S request and provided that TELKOM has paid the Maintenance   Fee due to SAP AFRICA, SAP AFRICA shall, deliver new RELEASES and   VERSIONS and related DOCUMENTATION to the DESIGNATED SITES at no *   extra cost to TELKOM. Maintenance Service does not include the delivery of any   SOFTWARE and DOCUMENTATION that SAP AFRICA offers as separate   products and/or which have not been licensed in terms of this AGREEMENT.   9. 4      All other maintenance, consulting or related services not referred to in this clause 9   and/or in annexure 2, shall be agreed upon separately in writing and shall be   subject to agreed additional charges.   Maintenance Fees and Payment   9. 5     As consideration for providing the maintenance services, TELKOM shall pay to   SAP AFRICA an annual fee, that shall be calculated as a percentage of the   agreed License Fee, expressed in USD, for the SOFTWARE as specified in   annexure 1 hereto. Such percentage is stipulated in the annexure 2 hereto   (the Maintenance Fee). TELKOM shall pay the Maintenance Fee annually in   advance, in ZAR, calculated at the ruling USD: ZAR rate of exchange on the



- 25 -  TELKOM CONTRACT No. 076C/01   date of invoice and otherwise in accordance with the other terms of payment   set out in this AGREEMENT and annexure 2.   9. 6    SAP AFRICA shall be entitled, upon 3 months written notice, to increase the   Maintenance Fee by increasing the percentage upon which the Maintenance   Fee is calculated or, on another basis provided that any increase to the   Maintenance Fee, caused by a combination of increases arising from:   9. 6. 1       inflation; and/or   9. 6. 2       the percentage at which the Maintenance Fee is calculated; and/or   9. 6. 3       USD/ZAR exchange rate movements,   shall not be greater than the annual increase in the South African   Consumer Price Index for all areas for the immediately preceding year (the   CPI), as published by the Central Statistics Agency of South Africa, or its   successors. However, should the Maintenance Fee not be increased by   the full extent of the CPI for any one year then, future increases to the   Maintenance Fee shall not exceed the difference between the actual   increases to the maintenance fee and the cumulative effect of the annual   increases in the CPI, for the immediately preceding thirty six consecutive   months period.   9. 7    The Maintenance Services may be terminated by TELKOM in writing at   any time upon 3 (three) months prior written notice. Subject to any   accrued rights and obligations, SAP AFRICA shall be entitled to   terminate the provision of Maintenance Services in respect of the   SOFTWARE or any modules thereof in the event of:



- 26 -                                             TELKOM CONTRACT No. 076C/01   9. 7. 1           an unremedied material breach of this AGREEMENT by TELKOM;   and/or   9. 7. 2             should SAP AFRICA, SAP AG or their respective licensors, cease, for   whatever reason, providing such Maintenance Services,   provided that in the latter case, SAP AFRICA and /or SAP AG shall procure   that COMMERCE ONE INC.. Inc. shall provide the Maintenance Service   and any related obligations of SAP Africa when providing Maintenance   Service in terms of this AGREEMENT including, its' obligations arising out   of annexure 3 Any Maintenance Fees paid in advance will be refunded to   TELKOM.   9. 8    Wherever in terms of this AGREEMENT, TELKOM is obliged or required   to provide remote access for whatever reason to SAP AFRICA, then   SAP AFRICA and its representatives, shall comply strictly with   TELKOMS internal policies, arrangements and procedures with regard   thereto.   9. 9    SAP AFRICA shall use its best endeavours to meet and comply with the   projected resolution times set out in annexure 2 hereto.   10.     WARRANTY   10. 1    SAP AFRICA warrants that the SOFTWARE will conform to the functional   specifications contained in the DOCUMENTATION on the date of installation of the   SOFTWARE and will perform, when in use without material alteration on the   DESIGNATED UNIT in accordance with the functional specifications set forth in   the DOCUMENTATION.



- 27 -                                             TELKOM CONTRACT NO. 076C/01   10. 2    SAP AFRICA'S warranty aforesaid is subject to TELKOM providing SAP AFRICA   necessary access, including remote access, to the SOFTWARE and, if necessary,   to the DESIGNATED UNIT and to TELKOM not being in breach of any material   term of this AGREEMENT.   10. 3    TELKOM must specifically identify to SAP AFRICA, the nature of the perceived   SOFTWARE defect and specifically describe the conditions under which the   perceived defect occurs. TELKOM shall provide SAP AFRICA with sufficient test   time and support on TELKOM'S DESIGNATED UNIT to duplicate the problem, to   verify that the defect is within or in respect of the SOFTWARE and to confirm that   the problem has been corrected, provided that SAP AFRICA shall do so in a   manner and at a time that does not, in the circumstances, unreasonably disrupt,   TELKOM'S day to day operations.   10. 4    Should any module or aspect of the SOFTWARE fail to conform to its' functional   specifications, then SAP AFRICA shall, in terms of its warranty set out in this   AGREEMENT, either correct the defect, or, at SAP AFRICA's option, replace the   defective SOFTWARE or any module thereof.   10. 5    When the USE of the SOFTWARE is significantly restricted by a reported defect   and TELKOM has complied with its obligations on reporting defects, then SAP   AFRICA shall commence work on correcting the defect in accordance with the time   periods stipulated in annexure 2, and to complete such correction as soon as   possible thereafter, subject in all cases to the provisions of this clause 10.   10. 6     SAP AFRICA, at its cost, shall deliver and install a correction of the defect in   machine-readable form. If, at TELKOM'S request, SAP AFRICA corrects a defect   of any VERSION or RELEASE that is not subject to maintenance service, then



- 28 -                                             TELKOM CONTRACT No. 076C/01   SAP AFRICA shall be entitled to charge TELKOM in respect thereof, at SAP   AFRICA'S standard or usual charges and rates.   10. 7    The warranty set forth in this clause 10 shall not apply:   10. 7. 1     if the SOFTWARE is not USED in accordance with the DOCUMENTATION;     or   10. 7. 2       to any EXTENSIONS or MODIFICATIONS not carried out by SAP AFRICA;     or   10. 7. 3       if the defect is caused by a MODIFICATION or EXTENSION not carried out     or approved by SAP AFRICA; or   10. 7. 4       if the SOFTWARE is not installed on a DESIGNATED UNIT; or   10. 7. 5       to the extent that the defect is caused to a material extent by TELKOM; or   10. 7. 6       if TELKOM does not provide access, including remote access to the   SOFTWARE as required under clause 10. 2; or   10. 7. 7       if the defect is caused by a malfunction in the THIRD PARTY DATABASE in   which event, SAP AFRICA will assist TELKOM to obtain appropriate redress   from the third party database supplier in accordance with SAP AFRICA'S and   its licensors' arrangements with the supplier.   10. 8   SAP AFRICA does not warrant that the SOFTWARE will operate uninterruptedly or   that it will be free from minor defects or errors, that do not materially affect the   performance of the SOFTWARE or that the applications contained in the   SOFTWARE are designed to meet all of TELKOM'S or its AFFILIATES' business   requirements.



- 29 -  TELKOM CONTRACT No. 076C/01   10. 9    The warranty set out in this clause 10, is given and accepted in lieu of all other   express or implied warranties in respect of the SOFTWARE. TELKOM   acknowledges and agrees that save as otherwise herein contained, no   guarantees, representations, warranties or undertakings of any nature have been   given to TELKOM by SAP AFRICA or any other person acting or purporting to act,   on behalf of SAP AFRICA, SAP AG or their respective licensors, and TELKOM   acknowledges that no representations or undertakings other than those contained   herein have been made to, or relied upon by TELKOM.   10. 10   Ownership of all data stored on, or by means of, the THIRD PARTY DATABASES   vest in TELKOM.   11    LIMITATION OF LIABILITY   11. 1   TELKOM'S sole and exclusive remedies for any breach of SAP AFRICA'S   warranties contained in clause 10 shall, at SAP AFRICA'S option, be either:   11. 1. 1       replacement of the SOFTWARE and/or performance of services in respect   thereof; or   11. 1. 2       return or credit of an appropriate portion of any payment made, or to be   made, by TELKOM with respect to the defective portion, or the whole of the   SOFTWARE or Maintenance Services, but excluding the License Fee or any   portion thereof.   SAP AFRICA must exercise its option within 20 days of first becoming aware of the   defect.   11. 2   TELKOM'S remedies for other loss or damages shall be as set out in clauses   11. 34 and 11. 5 below.



- 30 -                                             TELKOM CONTRACT No. 076C/01   11. 3   For the avoidance of doubt, it is recorded that SAP AFRICA will not be liable under   this AGREEMENT for:   11. 3. 1       the MODIFICATION or improvement of the SOFTWARE by TELKOM to fit   the particular requirements of TELKOM; or   11. 3. 2       the correction of any data errors resulting from MODIFICATIONS or   EXTENSIONS by TELKOM or its agents; or   11. 3. 3       the correction of any data errors as a result of misuse of the SOFTWARE by   TELKOM or its agents; or   11. 3. 4       preparation or conversion of data by TELKOM into the form required for use   with the SOFTWARE.   11. 4   Subject to, and without prejudice to the provisions of this clause 11. 1 and clause   10, SAP AFRICA'S liability for any loss or damages of whatever nature or however   arising, that may be suffered by TELKOM or AFFILIATE from USE or license of the   SOFTWARE and irrespective of the number of occurrences giving rise to such   liability, shall be limited to the aggregate of all License Fees paid by TELKOM to   SAP AFRICA in terms of this AGREEMENT, up until the date when such damages   are determined or agreed.   11. 5     Notwithstanding anything to the contrary contained in this AGREEMENT, a party   hereto (the defaulting party) shall not be liable for any consequential damage or   loss of whatever nature and/or however caused, that may be suffered by the other   party (the innocent party) other than for consequential loss or damages suffered   by the innocent party caused by the wilful or intentional acts or omissions of the



- 31 -  TELKOM CONTRACT No. 076C/01   defaulting party or any person or entity in respect of whom the defaulting party may   be vicariously liable. However, it is recorded for the avoidance of doubt that if   TELKOM should suffer a loss of revenue as a consequence of the SOFTWARE   failing to conform or perform to its functional specifications, then SAP AFRICA's   revenue share fee shall be decreased accordingly.   11. 6   It is agreed that each provision of this AGREEMENT that provides for a limitation   of liability, or warranties or exclusion of damages, is intended by the parties to be   severable and independent of any other provision and to be enforced as such.   11. 7     FAILURE OF MARKETPLACE   11. 7. 1      Notwithstanding anything to the contrary contained in this AGREEMENT and in   particular, clause 11. 1, in instances where the module of the SOFTWARE   constituting a portion of the Marketplace known as MarketSet 2. 0 Platform, fails   and cannot be accessed or USED by TELKOM and BUSINESS THIRD PARTIES   on the DESIGNATED UNIT and/or such other DESIGNATED UNIT where the   SOFTWARE is installed for disaster recovery or back-up USE, and such failure is   caused solely by a failure in the SOFTWARE to perform in accordance with the   specifications set out in the DOCUMENTATION and should the Marketplace   remain unable to be accessed or USED by TELKOM and/or BUSINESS THIRD   PARTIES for a continuous period of 72 hours, commencing from the time when   such failure is logged as a Priority 1 error (as defined in annexure 2) with SAP   AFRICA as a SOFTWARE problem and SAP AFRICA is unable to provide a   solution or resolution within the said 72 hours, then TELKOM shall be entitled to   terminate this AGREEMENT and claim damages limited as provided for in clause   11. 4.



- 32 -  TELKOM CONTRACT No. 076C/01   11. 7. 2       The remedy granted to TELKOM in terms of clause 11. 7. 1 shall only be available   until statistics with regard to the stability of the Marketset 2. 0 Platform has   reached a level that is acceptable to Telkom. Such acceptance shall be based on   market norms for the availability levels of Marketset software similar to or the   same as Marketset considered to be mission critical, which can be established via   independent market research, which shall be the responsibility and for the   account of SAP. In the event of a dispute between the parties then clause 22 shall   apply.   12     INDEMNITY   12. 1   SAP AFRICA warrants that SAP AG and its licensors own the SOFTWARE and   CONFIDENTIAL INFORMATION licensed by SAP AFRICA hereunder, including   all intellectual property rights therein and that SAP AFRICA has all rights from SAP   AG and its licensors necessary to licence the SOFTWARE and SAP AFRICA'S   CONFIDENTIAL INFORMATION to TELKOM in accordance with the terms of this   AGREEMENT,   12. 2   SAP AFRICA makes no representations with regard to the possibility of   infringement by combination use of the SOFTWARE. The parties agree that SAP   AFRICA has no duty to investigate any such possibility. As used herein,   combination use means use of the SOFTWARE in combination or conjunction   with any of the following (unless such use is prescribed in the   DOCUMENTATION):   12. 2. 1       any software other than the SOFTWARE (including TELKOM EXTENSION   or TELKOM MODIFICATION) MODIFICATION) unless such EXTENSION or   MODIFICATION has been incorporated, wholly or partially, in the   SOFTWARE; or



- 33 -  TELKOM CONTRACT No. 076C/01   12. 2. 2       any apparatus other than a DESIGNATED UNIT; or   12. 2. 3        any activities of TELKOM or its authorised AFFILIATES not licensed under   this AGREEMENT.   12. 3    Subject to clause 11. 2, SAP AFRICA shall indemnify TELKOM against all claims,   liabilities, and costs, including reasonable attorneys fees, reasonably incurred in   the defence of any claim brought against TELKOM in the TERRITORY by a third   party alleging that TELKOM'S USE of the SOFTWARE and DOCUMENTATION    infringes a third party's copyright, patent, PROPRIETARY INFORMATION and/or   trade secrets; provided that TELKOM promptly notifies SAP AFRICA in writing of   any such claim and SAP AFRICA is permitted to control fully the defence and any   settlement of such claim at SAP AFRICA'S own expense. TELKOM shall co-   operate fully in the defence of such claim and any reasonable costs incurred by   TELKOM in giving such co-operation shall be reimbursed by SAP AFRICA. SAP   AFRICA may, in its sole discretion, settle any such claim on a basis whereby SAP   AFRICA, substitutes the SOFTWARE and DOCUMENTATION (in consultation   with TELKOM) with alternative, substantially equivalent, non-infringing programs    and support DOCUMENTATION, which TELKOM shall be obliged to accept.   12. 4    SAP AFRICA, SAP AG and their licensors, shall not be liable for any claims,   liabilities and costs, including attorneys fees, reasonably incurred in the defence   of any claim (other than for the infringement of intellectual property rights   specified in clause 10. 3 above), arising out of TELKOM'S unauthorised use of the   SOFTWARE, DOCUMENTATION, THIRD-PARTY DATABASE and SAP   AFRICA PROPRIETARY INFORMATION, licensed under this AGREEMENT   provided that SAP AFRICA promptly notifies TELKOM in writing of such claim   and that TELKOM is permitted to control fully the defence and any settlement of   such claim.



- 34 -  TELKOM CONTRACT NO. 076C/01   12. 5   SAP AFRICA shall be entitled, in its sole discretion, to take such actions against a   third party that it determines are necessary or desirable in connection with any   infringement or alleged infringement by a third party of the SOFTWARE and any   module thereof or the DOCUMENTATION.   12. 6   Save as is set out in clause 11 and this clause 12, TELKOM shall have no other   claim or remedy arising from the alleged infringement of third party intellectual   property rights, against SAP AFRICA, SAP AG and their licensors.   13     ASSIGNMENT   13. 1   Neither Party shall be entitled to cede, or delegate its rights and obligations arising   from this AGREEMENT or to assign this AGREEMENT to any other person or   entity without the prior written consent of the other party provided that either party   shall be entitled to assign this AGREEMENT, in whole and not part only, to any of   its' subsidiary or holding companies (as defined and contemplated in the   Companies Act of 1973, as amended) provided that any such assignment shall   ipso facto cease to be of any further force and effect as between the parties,   should the assignee cease, for whatever reason, to be a subsidiary or holding   company, of the assignor.   13. 2   TELKOM recognises and agrees that the source code and all parts thereof, is the   valuable proprietary and confidential information and trade secrets of SAP   AFRICA, SAP AG and its licensors, and shall remain so even after a release of the   source code to TELKOM under the Escrow agreement the provisions of which are   set out in annexure 3. In the event of a release of the source code to TELKOM   under the Escrow agreement, TELKOM agrees to hold same in strict confidence   and to take appropriate action to preserve its confidentiality, and TELKOM shall



- 35 -  TELKOM CONTRACT No. 076C/01   have a non-exclusive, non-transferable LICENCE to use the source code solely for   its own USE in order to support and maintain the SOFTWARE and for no other   purpose whatsoever. TELKOM shall use the source code only at its own premises   on its own data processing equipment or third parties in accordance with the   license granted in terms of clause 3 and the provisions of this AGREEMENT.   TELKOM shall not copy the source code, nor disclose it to any third party except   agents retained by TELKOM to assist in maintaining the SOFTWARE, provided   that no such agent is in the business of marketing or developing SOFTWARE   competitive with the SOFTWARE.   14     GENERAL PROVISIONS   14. 1   AGREEMENT Binding - This AGREEMENT shall be binding upon and accrue for   the benefit of the parties hereto and their respective successors and permitted   assigns.   14. 2   Entire AGREEMENT - This AGREEMENT and each annexure hereto constitute   the complete and exclusive statement of the AGREEMENT between SAP AFRICA   and TELKOM as to its subject matter and all previous representations, discussions   and writings are superseded by this AGREEMENT. No variation of, or addition to,   this AGREEMENT shall be of any force or effect unless reduced to writing and   signed by both parties.   14. 3   Severability - It is the intent of the parties that in case any one or more of the   provisions contained in this AGREEMENT shall be held to be invalid or   unenforceable in any respect, such invalidity or unenforceability shall not affect the   other provisions of this AGREEMENT and this AGREEMENT shall be construed   as if such invalid or unenforceable provisions had not been contained herein.



- 36 -  TELKOM CONTRACT No. 076C/01   14. 4   No Waiver - If either party should waive any breach of any provisions of this   AGREEMENT, it shall not thereby be deemed to have waived any preceding or   succeeding breach of the same or any other provision hereof.   14. 5   Publicity -Neither party shall use the name of the other in publicity, advertising, or   similar activity, without the specific prior written consent of the other as to the   content, appearance, layout and other features thereof, provided that TELKOM   may use the marks SAP, and COMMERCE ONE INC and the phrase Powered   by Market Set in its websites that employ or utilise the SOFTWARE provided SAP   AFRICA and/or COMMERCE ONE INC.. Inc. have given its/their prior consent to   the format and typeface thereof which consent shall not be unreasonably withheld.   14. 6   Governing Law -This AGREEMENT shall be governed by and construed under the   Laws of the Republic of South Africa.   1 5.     DOMICILIA AND NOTICES   15. 1    Any notices to be given to the parties in terms of this AGREEMENT shall be in   writing and delivered by hand during ordinary business hours or posted by prepaid   registered post or transmitted by fax during normal business hours to the   addresses mentioned hereunder, which respective addresses the parties choose   as their domicilia citandi et executandi for the delivery or service of all notices,   communications or legal processes arising out of this AGREEMENT:   SAP  AFRICA :  SAP Business Park   1 Woodmead Drive   Woodmead, Sandton   Attention Managing Director



- 37 -  TELKOM CONTRACT NO. 076C/01   Fax: (011)235 6002   TELKOM                             The Managing Executive   Procurement Services   P 0 Box 447   Pretoria, 0001   19  th Floor, Telkom Towers North   152 Proes Street, Pretoria   Fax: (012)311 6210/Tel: (012)311 6047   or such other address in the Republic of South Africa as either party may choose   by written notice to the other from time to time.   15. 2   Every notice shall be deemed to have been properly given, in the absence of proof   to the contrary:   15. 2. 1       if delivered by hand, on the date of delivery;   15. 2. 2       If sent by prepaid registered post, 14 (fourteen) days after the date on which   the notice is posted;   15. 2. 3       If sent to a party at its telefax number, on the date of transmission where it is   transmitted during normal business hours of the receiving instrument, and on   the next business day where it is transmitted outside those business hours,   in either event provided that it has been confirmed by registered letter posted   no later than the business day immediately following the date of   transmission.



- 38 -                                             TELKOM CONTRACT No. 076C/01   15. 2. 4       Notwithstanding anything to the contrary herein contained, a written notice or   communication actually received by either party from the other, shall be an   adequate written notice as communication to such receiving party   notwithstanding that it was not sent to or delivered at that party's chosen   domicilium citandi et executandi.   16.     FRAUD   16. 1    If, at any time during the currency of this Agreement, TELKOM in its reasonable   discretion based on prima facie evidence determines that SAP AFRICA has, in   respect of this Agreement or any other contract or agreement to which they were   or are Parties:   16. 2. 1       acted dishonestly and/or in bad faith, and/or   16. 2. 2       has made any intentional or negligent misrepresentation to TELKOM   whether in any negotiations preceding the conclusion of, or in the execution   of this or any other agreement between the Parties,   then TELKOM will be entitled by written notice to SAP Africa forthwith to cancel   this Agreement. Upon such cancellation TELKOM will be entitled in addition to all   other remedies available to it, to recover from SAP Africa all damages it has   suffered by virtue of such conduct by SAP Africa. If, at the time of such   cancellation, TELKOM is indebted to SAP Africa for any amounts whatsoever,   TELKOM will be entitled to withhold payment in respect thereof for a period of 90   (ninety) days from the date of cancellation in order to investigate SAP Africa's   conduct and any damages suffered by TELKOM. No payment by TELKOM to SAP   Africa after the lapse of such period will preclude TELKOM thereafter, from   recovering from SAP Africa any such damages as it may have suffered.



- 39 -  TELKOM CONTRACT No. 076C/01   17.     FORCE MAJEURE   17. 1   If circumstances which were not foreseeable with reasonable foresight or   avoidable with reasonable care (circumstances) arise, or be reasonably   anticipated and delayed or have potential to delay the performance, whether in   whole or in part impossible then, the party whose performance is affected, or   whose performance may be affected (affected party), will forthwith, in good faith   and by the most expeditious means, notify the other party in writing of:   17. 2. 1         the cause, nature and extent of the circumstances;   17. 2. 2         the expected duration of the circumstances;   17. 2. 3         the extent to, which the performance will be affected.   17. 3     If the circumstances change after the affected party has notified the other party in   accordance with clauses stated above, the affected party will, forthwith, in good   faith and by the most expeditious means, inform the other party of such changes   and keep the other party undated on such changes.   17. 4   Subject to the Agreement clauses stated above, the circumstances will not   terminate the Agreement between the parties, or absolve the affected party from   performance.   17. 4. 1      If the circumstances make the agreed performance impossible, the affected   party will, having regard to all relevant factors, as soon as possible and in   good faith, put proposals for alternatives to the other party. Such proposals   will be in sufficient details to enable the other party to technically and



- 40 -                                             TELKOM CONTRACT No. 076C/01   informatively assess the alternatives and to decide whether any alternative   is acceptable.   17. 4. 2      If there is no alternative acceptable to the other party, it may elect to   terminate the AGREEMENT with immediate effect and without prejudice to   any other rights it may have, subject to payment of any amounts due and   payable.   17. 5     If the circumstances delay the agreed performance-   17. 5. 1      the affected party will, forthwith and in good faith, take all reasonable steps   to mitigate delay and recover lost time, and   17. 5. 2       having regard to all relevant factors and in good faith, notify the other party   as soon as possible of the steps to be taken to mitigate the delay and   recover lost time and keep the other party updated on changes and   progress thereof.   17. 5. 3       the other party may, if the extent to which the delay may be mitigated and   time lost be recovered are unacceptable to it, elect to terminate the   AGREEMENT.   17. 5. 4       neither of the parties will have any claim, arising from the circumstances,   on the other, provided any amounts due and payable, are paid in full.   17. 6     Without limiting the generality and intention of the clauses above in any way, the   circumstances may include, without being limited thereto:   17. 6. 1         War, riots, civil or military insurrection and like political happenings.   17. 6. 2         Natural disasters such as earthquakes, fire, storms and floods.



- 41 -                                             TELKOM CONTRACT No. 076C/01   17. 6. 3         Governmental acts and omissions.   17. 6. 4         Terrorism and sabotage.   17. 7     Any delay or non performance of any provision of the AGREEMENT (other than for   payment of amounts due hereunder) caused by conditions beyond the control of   the performing party will not constitute a breach of the AGREEMENT and the time   for performance of such provision, if any, will be deemed to be extended for a   period equal to the duration of the conditions preventing performances.   18.     SAFETY AND SECURITY   18. 1   SAP Africa agrees to comply with TELKOM'S security and safety procedures.   Without limiting the generality thereof, SAP Africa will specifically comply with the   Occupational Health and Safety Act. This AGREEMENT will constitute compliance   with section 37(2) of said act and SAP Africa will ensure that all necessary steps   are taken to comply the said Act.   19.     CANVASSING, GIFTS, INDUCEMENTS AND REWARDS   19. 1   SAP Africa will not under any circumstances offer promise or make any gift,   payment, loan, reward, inducement, benefit or other advantage to any of   TELKOM'S employees.   19. 2   Such an act is a material breach of the AGREEMENT and will be dealt with   accordingly.   20.     MODIFICATION OF AGREEMENT



- 42 -                                             TELKOM CONTRACT No. 076C/01   20. 1    If it becomes necessary during the AGREEMENT period to amend this   AGREEMENT or to delete any of the existing provisions contained in this   AGREEMENT, then such amendments will be done after consultation and mutual   agreement between SAP AFRICA and TELKOM and confirmed in writing and   signed by the parties to this AGREEMENT.   21.       MARKETING PLANS   As soon as possible after signature of this AGREEMENT, representatives of the   parties shall meet and commence discussions and negotiations on the   establishment, compilation and content of a marketing and branding plan in   respect of the SOFTWARE and the services offered and to be offered by   TELKOM, USING the SOFTWARE. During such negotiations, the parties shall   observe the principles of utmost good faith to each other and they shall use their   best endeavours to reach agreement on the sharing of responsibilities and tasks,   the financial and other contributions due from each party and such other   appropriate terms and conditions. Failure by the parties to reach any such   agreement, shall not entitle either party to terminate this AGREEMENT.   22.     ARBITRATION   22. 1. 1      Should any dispute of whatever nature arise between the parties, then any and all   disputes shall be submitted to and decided by arbitration. Any such arbitration   (the arbitration) will be governed by the provisions of this clause 22.   22. 2   Subject to the other provisions of this agreement specifically providing for the   resolution of any dispute, where any dispute, disagreement, or claim arises   between the parties (called here after the dispute) concerning this agreement, the   parties shall try to resolve the dispute by negotiation. This entails that the one party



- 43 -  TELKOM CONTRACT NO. 076C/01   invites the other in writing (providing details of the dispute) to meet and to attempt   to resolve the dispute within 7 (seven) days from the date of the written invitation.   Should the dispute not be resolved in this manner, the dispute will go to arbitration.   22. 3   The arbitration shall be held informally in Johannesburg or such other place agreed   upon by the parties and in accordance with the rules of the Arbitration Foundation of   Southern Africa, it being the intention of the parties that, as far as possible, the   arbitration shall be concluded within 21 days after it has been demanded.   22. 3   The arbitrator shall be a person agreed upon by the parties or, failing such   agreement, by the chairperson of AFSA. The arbitrator shall be empowered to   appoint such assistants as he deems fit in the event of the subject matter of the   dispute requiring expertise in any particular field for its proper resolution.   22. 4   Unless the parties otherwise agree, the arbitrator's award shall be in writing, and shall   be final and binding upon the parties and at the notice of either party, be capable of   being made an order of a competent court.   22. 5   No provision in this arbitration clause shall be taken as prohibiting the rights of either   party to approach the appropriate court for the purposes of any interim or interdictory   relief.   23     INSURANCE   23. 1   Without limiting SAP AFRICA'S liabilities or responsibilities in terms of the   AGREEMENT, SAP AFRICA will provide and maintain insurance to cover its   liability and responsibilities in terms of this AGREEMENT.   23. 2   Notwithstanding anything elsewhere contained in the AGREEMENT, SAP AFRICA   will provide at least:   23. 3   Insurance in terms of the Compensation for Injuries and Diseases Act, No. 130 of   1993, as amended. SAP AFRICA will upon request from TELKOM submit proof   to the satisfaction of TELKOM that it is insured under the Compensation for



- 44 -  TELKOM CONTRACT NO. 076C/01   Injuries and Diseases Act by providing TELKOM with adequate proof stating that   it has paid all assessments due;   23. 4   Legal liability in respect of claims for death and/or injury to persons or loss of/or   damage to third party property;   23. 5   Motor Vehicle Liability Insurance in respect of all motor vehicles brought onto the   premises of TELKOM.   24     CONFIDENTIALITY   24. 1   For the purposes of this clause, any person giving information shall be   referred to as the discloser and any person receiving information shall   be referred to as the recipient.   24. 2   All information of a confidential nature (including, but not limited to, all   information relating to the software), disclosed or made available by one   party to the other in connection with this agreement, whether furnished   verbally or in writing or in computer language, and whether marked   with proprietary legend or not, shall constitute confidential, proprietary   and trade secret information (collectively referred to as the   information) of the disclosure, provided that there shall be excluded   from such information any information which is at the time of disclosure   already in the public domain otherwise than by breach of this agreement   and there shall furthermore be excluded such information as the   recipient is able to show was within its knowledge prior to the   disclosure thereof.



- 45 -  TELKOM CONTRACT NO. 076C/01   24. 3   The recipient shall at all times, including such times after this   agreement has been terminated, unless otherwise agreed in writing by   the discloser, hold the information furnished by the discloser in strict   confidence and shall use such information solely for the purposes of   this agreement. The recipient shall disclose such information only to its   own employees and professional advisers as are necessary for the   purposes of carrying out its obligations and duties in terms of this   agreement, provided that prior to such disclosure such employees and   professional advisers have been advised in writing by the recipient of   the confidential nature of the information. The same shall be true of   customers. The recipient shall make no other use or disclosure of any   nature of the information. For the purposes of this clause 25, the   phrase personnel shall be deemed to include directors, sub-   contractors or other representatives of the recipient.   24. 4    The recipient shall at all times, unless otherwise agreed in writing by   the discloser:   24. 4. 1      hold the information and the reports furnished by the discloser in the   strictest confidence;   24. 4. 2      shall use such information and reports solely in connection with the   recipient's internal evaluation of the possibilities, the advancement and   implementation of the business association contemplated in this   agreement.



- 46 -                     TELKOM CONTRACT No. 076C/01   24. 5   24. 6   The recipient shall disclose such information and the reports only to its   own employees and professional advisers as are necessary on a strictly   need to know basis.   The recipient and its employees shall not copy, reverse, engineer,   exchange or reproduce the information and/or the reports, in whole or in   part, by any method whatsoever.    THUS DONE AND SIGNED at  Pretoria  on this 31st day of  March 2001     For and on behalf of SYSTEMS APPLICATIONS (AFRICA)(Proprietary)limited     /S/                                                                              /S/                                                                                    (who warrants his authority to so sign)   For:  TELKOM  SOUTH AFRICA LIMITED             (who warrants his authority to so sign)   /s/                                      (who warrants his authority to so sign)                          THUS DONE AND SIGNED at  Pretoria  on this 31st day of  March 2001   For and on behalf of TELKOM SOUTH AFRICA LIMITED   in the presence of the undersigned witnesses   AS WITNESSES     Signature         /S/    Print name:      name illegible   Signature         /S/    Print name:      M.L.MORKEL



- 47 -   TELKOM CONTRACT No. 076C/01



- 48 -    TELKOM CONTRACT NO. 076C/01   ANNEXURE 1   To   AGREEMENT   between   SYSTEMS APPLICATION PRODUCTS (AFRICA) (PTY) LIMITED   with   TELKOM SOUTH AFRICA LIMITED   Designated Site/Location:                       91 OAK AVENUE, CENTURION   Affiliate Name (if different from Licensee):         Delivery Address:   Contact Person:    B L A I RE       A B SH I RE     Tel.  No     012-677-3518   Designated Unit to be identified by Licensee to SAP AFRICA in writing.   Hardware Manufacturer:      Type/Model:    Operating System: ____________________________   CENTURION DATA CENTRE      91 OAK AVENUE, CENTURION



- 49 -     TELKOM CONTRACT NO. 076C/01   Database Manager: Licence Number:   1.        This Annexure 1 is annexed to and incorporated into the Agreement. Should any provision of this Annexure conflict with the provisions of the Agreement, then the provisions of this Annexure shall prevail.   The Licence fee for the Software licensed in terms hereof is US$5, 000, 000, 00. The License Fee shall be converted into ZAR and TELKOM shall be invoiced on the day following signature of this AGREEMENT at the ruling USD/ZAR exchange rate being the average between buy and sell usd offered by SAP Africa's bankers at the close of business on the date of signature of this AGREEMENT. The License Fee expressed in ZAR plus VAT thereon shall be payable by TELKOM within 7 days of the date of invoice. Should TELKOM fail to pay the License Fee on due date then, TELKOM shall pay interest on such amounts due but outstanding at the legal rate of interest and any negative variation in the USD/ZAR exchange rate from due date of payment until receipt of payment shall be for TELKOM'S account. If this AGREEMENT is not signed by Telkom on or before 31 st  March 2001, then the license fee shall be determined in accordance with the SAP Africa/COMMERCE ONE INC.. standard pricing policies.   3.         The revenue share that TELKOM shall pay to SAP AFRICA shall be 10%.   4.          The Software licensed in terms of this agreement comprises the following modules and    components:   A. Platform   15. 1. 1.                         Product Description   The MarketSet 2. 0 Platform provides the infrastructure on which the MarketSet E- Marketplace is created and deployed. The MarketSet 2. 0 Platform provides the necessary tools and components to support the exchange of XML-based business documents (xCBL) between trading partners, and enables business services to interact with those business documents. More specifically, the MarketSet 2. 0 platform provides the messaging, routing, addressing, transaction, security, connectivity, and high availability components and services, necessary to create and deploy world class business-to-business e-marketplaces. The MarketSet 2. 0 platform shares a common feature/functionality set with COMMERCE ONE INC.. 's MarketSite 4. 0 and Net Market Maker 2. 0 e-Marketplace solutions.



- 50 -     TELKOM CONTRACT NO. 076C/01   16. B. Market Set Builder   16. 1. 1. Product Description   MarketSet Builder is an essential element of the MarketSet E-MarketpIace infrastructure. It enables communities to develop and flourish within a marketplace. It enables the marketplace operator to create their own branded marketplace, register and manage users of their marketplace and target content and services to those users. In addition, it plays a critical role in the integration of business services to the marketplace   1 7. C. Business Services Framework   17. 1. 1. Product Description   The Business Service Framework, or BSF, is a set of services, interfaces, tools, methodologies, and documentation that provides, as a whole, a comprehensive means for connecting new services into the Global Trading Web.   Add-In Services   The open and flexible Market Set Business Services Framework enables e- marketplaces to leverage their domain expertise and provide additional services and greater value for their users. An e-marketplace can incorporate third-party services specific to an industry, as well as cross-industry services such as shipping, taxation, and credit reports.   18. Core Market Set Services   19. A. Procurement Services   19. 1. Product Description   Enterprise Buyer Professional Edition has been optimized for SAP customers looking for an e-procurement application that can automate the entire purchasing process, including MRO as well as direct goods purchases. When this application suite is run hosted at a MarketSet, this is referred to as Procurement Services. Professional has deep integration natively to the other supply chain components that make up the MarketSet solution.



- 51 -     TELKOM CONTRACT NO. 076C/01   20. B. Content Services   20. 1. Product Description   Content Services offers a comprehensive set of offerings to handle all of the content needs of Market Set e-marketplaces and deliver value-added content to their trading communities.. Market Set's content and catalogue offering includes the following components and services:   21. Content Engine   21. 1. Product Description   Content Engine addresses all the critical needs of an e-marketplace operator to create, operate, and maintain a commerce-ready Catalog. Content Engine combines unique data aggregation capabilities with an easy to use, powerful search engine that enables marketplace operators to offer a multi-supplier catalog that could potentially contain products and information from thousands of suppliers. Content Engine also allows marketplace operators to link 3rd party data (ratings, data sheets, regulations information) or self created content to product information to provide a unique value added search experience for their community.   22. C. Order Management Services   22. 1. Product Description   MarketSet Order Management Services is a web-based application offered as a hosted service that enables sellers to simply manage orders and publish content through a Web browser. MarketSet Order Management Services allows suppliers to transact with buyers using only a browser and access to the Internet.   MarketSet Order Management Services is a critical piece of the solution that allows the participation of small or specialized sellers. With MarketSet Order Management Services, the buying customer can access unique products from a full range of sellers, regardless of their technical infrastructures.   MarketSet Order Management Services provides an efficient and easy-to-administer solution to enable sellers and automate the transaction process. At the same time, a MarketSet market maker is able to administer and monitor transaction related activities to ensure high service quality for their e-marketplace.



- 52 -    TELKOM CONTRACT NO. 076C/01   23. D. Auction Services   23. 1. 1. Product Description   Market Set Auction Services offers real-time bidding solutions for corporate buyers and sellers, enabling them to quickly and cost-effectively implement B2B Internet bidding events to enhance existing procurement or liquidation processes. Market Set Auction Services supplies businesses with a fully hosted solution and provides users with administrative capabilities to control the data and the bidding process. It enables businesses to conduct online dynamic exchanges of products and services with their suppliers, their channel partners and their customers   24. E. Analysis Services   24. 1.                 Product Description   The Reporting Solution in MarketSet 2. 0 includes capturing and retaining information about the data that passes through Enterprise Buyer Professional Edition on the e- marketplace and providing that data to Business Information Warehouse 1for analysis. Standard report templates are available out of Business Information Warehouse as well as the ability to create custom reports. Users can also use the build in online analytical processing (OLAP) engine for further evaluations and analyses. Currently, Enterprise Buyer Professional Edition is the only service providing data to Business Information Warehouse, but other services will provide data in future releases.   1 Branding name may change.



- 53 -    TELKOM CONTRACT No. 076C/01   2 4 .   2 .       S o f t w a r e   The following software is provided in the MarketSet 2. 0 Solution package:    Market Site Platform 4. 0    Market Site Admin Console 4. 0    Market Site Builder 4. 0    Order Management Services x. x    Supply Order 3. 0    SDK Pro 4. 0    BCC 4. 0    CPC 3. 2. 1 NT (128 Bit)    Business Connector 3. 1. 1    Document Mapping Service 1. 1    Procurement Service (Enterprise Buyer Professional Edition)    Content Engine 2. 0 with Service Pack 2    Planning Services 3. 0a (URL Link Only)    Design Services     Business Analysis 2. 0B    ITS 3. 0    Auction Services 4. 0    Market Set 1. 0 Additional Components CD    Business Connector 3. 1 (Developer Edition)    Round Trip Broker 1. 1    Bulletin Board 1. 0    User Management Mapping Service 1. 0    Installation for Market Set 1. 0 (PDF)   24. 3. 3rd Party Proprietary Software also Licensed in terms of this Agreement



- 54 -     TELKOM CONTRACT No. 076C/01   The following 3rd party proprietary software is provided as a part of the MarketSet E- Marketplace Solution    SonicMQ Message Broker    Netscape's iPlanet Directory Server 4. 11    Extensibility's XML Authority 1. 1 d    Allaire's JRun Pro 2. 3. 3    InetSoft's Style Report 2. 1    Cygnus'GNU Tools B20. 1 Release    Sun's Java Naming and Directory Interface 1. 2    Sun's Java Server Development Kit 2. 0    Sun's JavaMail. 1. 2    Sun's JavaBeans Activation Framework 1. 0. 1 Release    Sun's Java Runtime Environment Version 1. 2. 2    Sun's Java Foundation Classes (JFC) / Swing JFC 1. 1 with Swing 1. 1. 1    lAIK's Java toolkit for Cryptography Extension 2. 51    lAIK's iSaSiLk Java toolkit SSL 2. 51    RSA's BSafe Crypto-J    James Clark's XT XSL Processing Library Version 19991105    ANTLR. ORG's ANTLR 2. 5. 0    SAX's SAX 1. 0 and 2. 0     W3C's Jigsaw 2. 0. 3    Microsoft Virtual Machine Build 3229    Microsoft's Data Access Components (MDAC) 2. 1. 2. 4202. 3 Service Pack   5.  The following third party databases need to be acquired and licensed by Telkom (if    not already acquired and licensed) to enable the software to be operated:



- 5 5 -     TELKOM CONTRACT No. 076C/01   SAP MARKETSET DATABASES             Jrun           JDK           Web           Server           DB            JDBC             LDAP                   NT 4. 0               HotSpot Server             1. 2. 2             MJHS IIS 4. 0            MS SQL 7 SP 2            I-NET OPTA 2000             4. 1. 2 on NT                     SOLARIS 8                  HotSpot Server                        1. 2. 2                   Apache 1. 3. 9 +                      Oracle DB 8. 1. 6                      Oracle Driver for JD                            1. 2                    Netscape LDAP v                    4. 1. 2 on Solaris         WINDOWS 2000                  HotSpot Server                        1. 2. 2                      MS IIS 5. 2                     MS SQL 7 SP2                    I-NET OPTA 2000                     Netscape LDAP v                        4. 1. 2 on NT



-56-    TELKOM CONTRACT NO. 076C/01      THUS DONE AND SIGNED at  WOODMEAD  by SYSTEMS APPLICATIONS PRODUCTS (AFRICA) (PROPRIETARY) LIMITED    on this 31st day of  March 2001    /S/               For SYSTEMS APPLICATIONS PRODUCTS (AFRICA)(Pty)limited     /                                                                                                 (who warrants his authority to so sign)   For:  TELKOM  SOUTH AFRICA LIMITED             (who warrants his authority to so sign)   /s/                                                                THUS DONE AND SIGNED at  Pretoria by the TELKOM SOUTH AFRICA LIMITED    on this 31st day of  March 2001       AS WITNESSES     Signature         /S/        Signature         /S/



- 57 -     TELKOM CONTRACT No. 076C/01   ANNEXURE 2   to   AGREEMENT   between   SYSTEMS APPLICATION PRODUCTS (AFRICA) (PTY) LTD   and   TELKOM SOUTH AFRICA LIMITED   MAINTENANCE FEE   1.     The Maintenance Fee shall be calculated at 17% of the License fee stipulated in          annexure 1 for the license of the SOFTWARE.   2.     MAINTENANCE SERVICES   SAP Africa (SAP) endeavours to provide the highest quality support and to ensure system stability throughout the life cycle of the Software solution. TELKOM will benefit through a lower total cost of ownership and will, in the future, experience an optimal usage of system resources and protection of existing investments.            7 x 24h Support Worldwide   SAP Customer Support delivers help for software problems in a fast and competent manner. SAP provides a 7 x 24h Support availability for messages with 'very high' priority using the 'Follow-the-Sun' model. At any given time of day an expert will be at hand to provide advice.   All Support centres are linked through a unique Support infrastructure, ensuring that all information provided to SAP is on hand regardless where or when.



- 58 -     TELKOM CONTRACT No. 076C/01   Software Maintenance   Software Maintenance includes the further improvement of the software, as well as the continuous adaptation of the software to new database and operating system versions.  Each new release contains solutions to all known software errors.   Delivery of Functional Enhancements and Updates to the R/3 Software   SAP and its Licensors continuously enhance and improve the Software to ensure that Licensees customers always have the latest technology and business functions (e. g. functionality supporting the introduction of the Euro). SAP ensures that customers always receive the latest release of the R/3 software as soon as it becomes available.    Integrated Support for SAP and Partner Products   SAP maintains Collaborative Support Agreements with SAP Partners who have provided Licensees with hardware, operating system and database platforms to ensure seamless support. Should a Licensee request SAP require the involvement of the respective partner, SAP has established interfaces and procedures to do so.    Access to 'SAP's Frontend (formerly: OSS)   SAP'sFrontend is a quick and user-friendly interface for communication between customers and SAP. Features include:   - Access to the Software Support Package repository for downloads   - Database access to individual problem solutions for downloads   - Knowledge Database access to a wealth of information on the use of the Software   - Electronic notification about important information (HotNews)   - Access to SAP's request handling process.   Support Services   The requirement for deriving the full benefit from SAP's Global Support Network is a remote connection from the customer's Software System to SAP's Frontend. This enables the efficient usage of SAP's portfolio of Remote Services and will enable customers to work with the SAP Support experts whenever required and in particular, at the start of their



- 59 -     TELKOM CONTRACT NO. 076C/01   implementation. Also, a remote connection is a prerequisite for 7 x 24h support for priority 1 messages.   Under the TeamSAP Support maintenance agreement, SAP Support deals with problem messages pertaining to:   - An error in the software   - An error in the software causes subsequent errors   - There are problems when implementing corrections   - There is no training or documentation available   - The functions are not logical   - The software ergonomics has flaws   Messages of this nature are responded to in writing via SAP's Frontend.   Any other messages are termed consulting issues and may be processed by either SAP's Remote Consulting department, the customer's implementation consultants or SAP consultants. This service is, however, priced separately and is not within scope of the maintenance agreement. Messages of this nature usually concern:   -  Processing logic of the software, the business processes and customising (questions  regarding working with transactions, programs and screens, the contents of screens  and  pr in touts ,   e tc .   )   - Administration or tuning of the SAP System, of the database or the operating system   - Errors caused by a modification of the system   - A solution is clear from the short text or from the help text of the system error   Maintenance Service Levels   Optimum support with fast reaction times is the cornerstone of SAP's Support organisation. SAP's Support process uses a three-tier Support structure:    Local Support (in 50 countries worldwide)   Local Support Centres at SAP subsidiaries are the local contact points for customers. During usual working hours, the Local Support Centres handle all inquiries relating to support in the language of the respective country and, if necessary, forward them to the



-60-    TELKOM CONTRACT NO. 076C/01    appropriate local partner or the nearest Regional Support Centre. Most inquiries are entered via SAP 's Frontend which offers all the advantages of automatic dispatching.    Regional Support (more than 400 Support professionals in four Regional Support Centres)   Regional Support Centres are located in Walldorf, Germany (Europe/Africa), Philadelphia, USA (Americas), Singapore (Asia-Pacific) and Tokyo, Japan (North East Asia). These Centres are responsible for processing support inquiries and also form part of the 7 x 24h support network. According to the 'FoIlow-the-Sun' principle, inquiries received outside normal working hours are automatically forwarded to the Regional Support Centre that is currently active. Another task is the co-ordination of regional partners in their co-operation with SAP customers.    Development Support (Europe, Americas, Asia)   SAP Africa's Local Support Centre supports all SAP customers in the Southern Africa/Sub- Sahara region. In the event of SAP Africa being unable to respond timeously or effectively, the support query will be elevated to COMMERCE ONE INC.. Inc. consultants, in which event, SAP Africa shall use its best endeavours to respond timeously in accordance with the service levels stipulated in the table below.   The Quality Management processes implemented throughout the SAP Support organisation are certified globally according to the international standard ISO 9002.   The workflow between the support levels is defined in an internal Support Level Agreement (SLA) and SAP's Support Process Monitoring team ensures that requests are forwarded smoothly between the support levels. SAP Africa, SAP AG and their respective licensors shall use their best endeavours and efforts to ensure that the below mentioned Initial Reaction Times and Projected Resolution Times (PRT) are achieved in 80% of all cases;   Priority   Very High (1)   High (2)   Medium (3)   Low (4)   Initial Reaction Time   (IRT)   30 minutes   2 hours   4 hours   8 hours   Projected Resolution Time   (PRT)   1 day   3 days   7 days   1 4 days   Priority 1: d, h, min = days, hours, minutes in actual time Priority 2, 3, 4: d, h, min = days, hours, minutes during office hours



- 61 -     TELKOM CONTRACT No. 076C/01   The initial reaction time (IRT) is the time elapsed between message receipt at SAP (Send to SAP in SAP Service System) and initial contact with the customer or change of the message status.   The Projected Resolution Time (PRT) is the time elapsed between IRT and providing a solution.   Priorities of messages are defined as follows:    Very High or Priority 1   A message with priority Very high is justified when critical restrictions in day-to-day operations are encountered. Critical tasks, especially time-critical jobs, cannot be performed, due to a total system shutdown or a malfunction in a main function of the production SAP system.   This message requires immediate processing, as the malfunction can result in serious losses.    High or Priority 2   A message with priority High is justified when serious restrictions in day-to-day operations are encountered. Necessary tasks cannot be performed due to a malfunction or failed function in the Software that is urgently required in the current situation.   The message requires rapid processing, because the continuing malfunction could cause a serious interruption in the entire production system.    Medium or Priority 3   A message with priority Medium is justified when restrictions in day-to-day operations are encountered. This is caused by a malfunction or failed functionality in the system.    Low or Priority 4   A message with priority Low is justified when day-to-day operations are not affected or only affected in a minor fashion. This is caused by a malfunction or failed functionality in the system that is not used daily or is only used rarely.   (Problem situations in test systems will normally result in a priority that is one level lower than the identical problem in a production system).



- 62 -     TELKOM CONTRACT No. 076C/01   On the anniversary of this AGREEMENT, the parties shall enter into discussions and   negotiations for the purposes of reviewing the aforestated maintenance service level terms,   more particularly, the related commercial terms thereof including, the maintenance fee and/or   percentages; the response, processing and resolution times; the penalties that may be   payable by SAP Africa and/or its licensors for failing to comply with such times and other   aspects of the maintenance services. The parties acknowledge that the market for the   SOFTWARE in South Africa is limited and that therefor it may be difficult to ascertain market   conditions for the purposes of reviewing such commercial and related terms. Accordingly,   the parties shall take cognisance of market conditions in other countries where the   SOFTWARE is being used. Should the parties be unable to agree upon any such   amendments within 30 days from the anniversary date, then such dispute shall be referred   for determination by the Arbitration Foundation of Southern Africa (AFSA) in accordance   with the rules of AFSA and to an arbitrator appointed by the Chairperson of AFSA upon   application by either party. The arbitrator shall upon request of either party, appoint a   suitably qualified expert to assist him in determining the dispute. Except in the case of   manifest error, the arbitrators' ruling shall be final and binding upon the parties but shall be   without prejudice to a party's other rights and obligations arising from the AGREEMENT.



- 6 3 -    TELKOM CONTRACT No. 076C/01     Customer Message Support   The process of customer message support is the interface between development and service. The process steps that impact upon the SLA are customer message recording, preliminary checking, search for relevant error notes (known problem solution), and problem analysis.   Life Cycle of a Customer Message   Refer to accompanying PDF for diagram    Telkom customers can access the SAP's Frontend or SAPNet-Web Frontend and create their own requests and messages. Customer requests and messages that are received in writing via fax (+27 11 2356004) are first processed by the support facility of the Local Support Centre and then recorded for further processing in SAP's internal customer support system. A request or message is automatically assigned to an administrator in the SAP support organization (Local Support and Regional Support for the Software) based on the components assigned to it.   Performing preliminary checks, searching for troubleshooting information   The processor first checks whether the problem report is complete, and whether an entry has already been made in the system containing a solution to the reported problem. This search is conducted semi-automatically in SAP's support system. If an entry is found containing a solution to the problem, then the person who had submitted the problem report is notified in writing via SAPNet and the problem is closed for SAP.   Problem Analysis   If, following preliminary analysis, the Local Support level decides that the problem must be handled by an expert in the respective component, the problem is passed on to the Regional



- 64 -     TELKOM CONTRACT No. 076C/01   Support level. If the problem involves a program error or if the processor cannot find a solution despite intensive analysis, he or she transfers it to the Development Support level. The responsibility for Development Support lies with the user departments of the development areas.   If no relevant error note (known solution) exists, the customer shall provide SAP with sufficient test time and support, as an attempt is made to reproduce the reported problem and to determine whether it is a problem with the software (at SAP or in the customer's system, provided that the latter does not negatively affect the customer's operations). If this reproduction of the problem is not possible, the next time the problem occurs, additional analyses are performed to narrow down the source of the problem. In the meantime, the problem receives the status of customer action in the support system. If special handling by an expert is required, then it is relayed to Development Support.   Escalation Management   In the event of SAP's Support Management deciding that the standard support processes are insufficient to solve a critical customer situation (problems as described in point 2 above) a formal escalation process is invoked.   During this process, SAP will assign the required SAP personnel to the customer remotely (via a remote connection) and/or on site, as appropriate. These resources will be under the direct supervision of SAP's management and the customer will not incur any costs.   A formal de-escalation process, involving an assigned Customer Services Manager, will take place once the critical issue has been resolved.   During the implementation phase prior to the SOFTWARE being installed, SAP AFRICA and TELKOM will negotiate with each other to discuss and agree upon an appropriate detailed escalation process for the Maintenance Services that SAP AFRICA and its licensors will provide and that will apply during the said implementation phase and the go-live stage. The parties shall also determine an escalation process that is appropriate for TELKOM'S needs and business requirements when USING the SOFTWARE.



-65-    TELKOM CONTRACTN0. 076C/01   THUS DONE AND SIGNED at  WOODMEAD  by SYSTEMS APPLICATIONS PRODUCTS   (AFRICA) (PROPRIETARY) LIMITED    on this 31st day of  March 2001    /S/                  /S/                                                   (who warrants his authority to so sign)   For:  TELKOM  SOUTH AFRICA LIMITED             (who warrants his authority to so sign)   /s/                                                                THUS DONE AND SIGNED at  Pretoria by the TELKOM SOUTH AFRICA LIMITED    on this 31st day of  March 2001 in the presence of the undersigned witnesses       AS WITNESSES     Signature         /S/        Signature         /S/



- 66 -     TELKOM CONTRACT No. 076C/01   ANNEXURE 3   to   AGREEMENT   between   SYSTEMS APPLICATION PRODUCTS (AFRICA) (PTY) LTD   with   TELKOM SOUTH AFRICA LIMITED   1.           ESCROW ARRANGEMENTS   1. 1       SAP Africa warrants that the entire source code for the SOFTWARE owned by   or licensed by SAP AG and/or COMMERCE ONE INC.. (Source Code),   together with related DOCUMENTATION as it is, or becomes available, shall   be deposited into an escrow account by no later than 30 June 2001 which is   maintained at Volksbank Wiesloch, Germany (the Escrow Agent), pursuant   to an agreement between the Escrow Agent and SAP AG (the Escrow   Agreement). The Escrow Agreement provides that the Escrow Agent shall,   under certain circumstances, release the Source Code and related   DOCUMENTATION to TELKOM.   1. 2       SAP Africa further warrants that SAP AG will from time to time (as soon as   the relevant RELEASE and/or VERSION has been finalised) deposit into the   escrow account copies of all new versions of the Source Code and related   DOCUMENTATION encompassing any and all copies of all versions of the   Source Code and related DOCUMENTATION encompassing any and all   CORRECTION LEVELS.



- 67 -     TELKOM CONTRACT No. 076C/01   1. 3                       TELKOM may, at its own cost, verify that the new version of the Source Code   is deposited with the Escrow Agent.   1. 4                       Without prejudice to any express provision to the contrary contained in the   AGREEMENT, TELKOM shall have the right to access the Source Code if   SAP:   1. 4. 1                           is in default of any material term, condition or provision of this   AGREEMENT as a consequence of which the TELKOM is prevented from   having substantial USE and benefit of the SOFTWARE in terms thereof   and remains in default for a period of 30 (thirty) days from receipt of the   first written request to remedy the default concerned; or   1. 4. 2                            ceases to carry on business or to provide the particular USE, service or   benefit referred to in clause 12. 4. 1; or   1. 4. 3                           becomes bankrupt or has a receiving order made against it, or is placed in   liquidation or under judicial management in either case, whether   provisional or final, or is deregistered.   1. 5                       TELKOM shall not have the right to access the Source Code if SAP AG or a   SAP AG affiliate agrees to assume, carries out and continues to carry out,   SAP Africa's maintenance obligations under this AGREEMENT, pursuant to   the terms and conditions hereof.   1. 6                       TELKOM recognises and agrees that the Source Code and all parts thereof, is   the valuable proprietary and confidential information and trade secrets of SAP   AG, and shall remain so even after a release of the Source Code to TELKOM   under the Escrow Agreement. In the event of a release of the Source Code to   TELKOM under this AGREEMENT, TELKOM agrees to hold same in strict   confidence and to take appropriate action to preserve its confidentiality, and



- 68 -     TELKOM CONTRACT No. 076C/01   TELKOM shall have a non-exclusive, non-transferable LICENCE to USE the   Source Code solely for its own use in order to support and maintain the   SOFTWARE and for no other purpose whatsoever. TELKOM shall USE the   Source Code only at its own premises on its own data processing equipment   or third parties in accordance with clause 3 of the AGREEMENT. TELKOM   agrees not to copy the Source Code, nor to disclose it to any third party except   Agents retained by TELKOM to assist in maintaining SOFTWARE, provided   that no such Agent is in the business of marketing or developing software   competitive to the SOFTWARE.



-69-     TELKOM CONTRACT No. 076C/01   THUS DONE AND SIGNED at  WOODMEAD  by SYSTEMS APPLICATIONS PRODUCTS   (AFRICA) (PROPRIETARY) LIMITED    on this 31st day of  March 2001    /S/               For SYSTEMS APPLICATIONS PRODUCTS (AFRICA)(Pty)limited     /                                                                                                 (who warrants his authority to so sign)   For:  TELKOM  SOUTH AFRICA LIMITED             (who warrants his authority to so sign)   /s/                                                                THUS DONE AND SIGNED at  Pretoria by the TELKOM SOUTH AFRICA LIMITED    on this 31st day of  March 2001       AS WITNESSES     Signature         /S/        Signature         /S/
answer:
Highlight the parts (if any) of this contract related to Insurance that should be reviewed by a lawyer. Details: Is there a requirement for insurance that must be maintained by one party for the benefit of the counterparty?


question:
CONFIDENTIAL PORTIONS OMITTED

                                                                   EXHIBIT 10.16

                       [LOGO OF TEAM SABCO APPEARS HERE]

                             SPONSORSHIP AGREEMENT

THIS SPONSORSHIP AGREEMENT (hereinafter the Agreement) is made and entered into this 19th day of December 1997, by and between SABCO RACING, INC., a North Carolina corporation with a place of business in Iredell County, North Carolina (hereinafter Sabco), and Prolong Super Lubricants, Anaheim, Calif. (Hereinafter to be referred to as Prolong);

                                  WITNESSETH:

     WHEREAS, Sabco is engaged in the business of operating NASCAR Winston Cup  Series race cars and wishes to provide advertising space and advertising,  promotional and marketing assistance to Prolong; and

     WHEREAS, Prolong desires to become a major associate sponsor of all three Sabco entries during the 1998, 1999 and year-2000 NASCAR Winston Cup Series racing seasons. These entries shall mean the Sabco No. 40, all NASCAR Winston Cup Series races during this three-year period; the Sabco No. 42, all NASCAR Winston Cup Series races during this three-year period; and Sabco No. 46, all NASCAR Winston Cup Series races during this three-year period. Prolong shall use its sponsorship of the Sabco entries for advertising, promoting and marketing itself.        WHEREAS, the parties desire to set forth in this Agreement their respective rights and obligations;

     NOW, THEREFORE, in consideration of the mutual promises and agreements set  forth herein, and for other good and valuable consideration, the parties hereto  agree as follows:

     1.    Term.  The term of this Agreement shall commence with the first race             ----- of the 1998 Winston Cup season and shall continue until the final race of the  year-2000 Winston Cup season.

     2.    Services to be provided by Sabco.  Sabco shall perform the following            --------------------------------- services for Prolong during the term hereof:

     A.    Drivers.  The drivers for the 33 Winston Cup events to be held             -------- during the 1998 season in which Prolong is an associate sponsor shall be  Sterling Marlin (40), Joe Nemechek (42) and Wally Dallenbach Jr. (46), unless  due to injury or for some unforeseeable reason, either is unable to drive, in  which event Sabco shall choose a substitute driver to drive their respective  Sabco/Prolong-sponsored entry.  For the duration of this agreement, Sabco  reserves the right to substitute or replace any of the aforementioned drivers  listed without prior notice to Prolong or prior approval from Prolong.

     B.    Decal location.  Sabco will designate Prolong as an associate sponsor            --------------- on its No. 40, No. 42 and No. 46 Winston Cup race cars in the aforementioned 33 events. Sabco shall cause each car to be painted with paint schemes approved by each's primary sponsor and shall cause to display Prolong associate sponsor decal signage upon the middle side panel (between car number and rear tire; both sides of car) with dimensions of approximately 6

  inches high by 16 inches long. In addition, Sabco shall provide, subject to Prolong's approval, drive, pit crew, team uniforms, team pit equipment, team race car transporter, show car and show car transporter bearing prominent Prolong associate sponsor identification as well as team pit equipment with size and placement commensurate with level of sponsorship

    3.  Driver Appearances.  Sabco shall provide unto Prolong five aggregate          ------------------ driver appearances (2) two-hours each at no fee. Prolong shall be responsible  for all first class travel expenses relating to each driver appearance, i.e.  hotel, airfare, meals, etc.  Additional appearances by Sabco drivers shall be at the discounted rate of [ * ] ($[ * ]) Dollars per day per driver, [ * ].

        Sabco shall further provide the services of each driver for one free day for commercial use (up to six hours each) for still photo shoot, TV and  radio/commercial production.  Prolong shall be responsible for all first class  travel expenses relating to each driver appearance, i.e. hotel, airfare, meals,  etc.

        All Sabco drivers, while under contract with Team SABCO, shall allow their likeness, voice, picture and signature to be used for commercial purposes endorsing Prolong at no additional costs during the term of this agreement.

   4.   Compensation. Prolong agrees to pay unto Sabco the sum [ * ] [ * ]          ------------ Dollars ($[ * ]) for services to be provided by Sabco over this three year period of 1998, 1999 and year-2000.  This sponsorship fee of $ [ * ] shall be





paid to Sabco in the following installments:  Year One (1998): $ [ * ] (four  equal installments of  $ [ * ] to be paid on 3/15/98, 6/15/98, 8/15/98 and  10/15/98); Year Two (1999): $ [ * ] (four equal installments of $ [ * ] to be  paid on 3/15/99, 6/15/99, 8/15/99 and 10/15/99); Year Three (year-2000): $ [ * ] (four equal installments of $ [ * ] to be paid on 3/15/2000, 6/15/2000,8/15/2000 and 10/15/2000).

   5.   Show Car. Sabco agrees to provide at no expense to Prolong for its use         -------- in promoting its sponsorship, five (5) free show car appearance days whereas Prolong can deem which of the Sabco show cars to use. This shall mean that Prolong may schedule any combination of Sabco's three show cars (based on availability) not to exceed a total of five show days (travel days are considered a show date). Sabco will provide transportation of show car and will provide an attendant to stay with the car during its display period. For any show car appearance requested by Prolong over and above the five (5) free appearances, Sabco will make available unto Prolong a show car at a discounted rate of [ * ] Dollars ($ [ * ]) per day. All travel days to and from the site of a show car appearance, as well as the actual day upon which show car is on display will be charged as a show date. It is further understood that the parties will agree in advance upon a schedule of places and events for the show car to be displayed at such times as will not interfere with Sabco's racing schedule.

    6.  Media, Public Relations and Sponsor Communications. Sabco will use its         -------------------------------------------------- best efforts to obtain favorable exposure for Prolong and will be available to assist Prolong with public relations activities to a reasonable extent. This shall include making members of Sabco available for media interviews, press conferences or other public relations activity, as reasonably requested by Prolong, at or near race sites on dates Sabco is at race sites pursuant to their obligations hereunder. Sabco shall provide at its expense a staff member to handle race team's media and public relations needs and shall cause Prolong to receive prominent mention and display within press kits featuring the Sabco No. 40, 42 and 46 race cars. In each of the 1998, 1999 and year-2000 races in which Prolong is designated as an associate sponsor, Sabco shall fax to Prolong officers on the Monday following the race, race results and a summary of the prior weekend activities.

     *  CONFIDENTIAL PORTIONS OMITTED AND FILED SEPARATELY WITH THE COMMISSION.

         7.  Exclusivity. During the term of this Agreement, Sabco will not             ----------- represent or accept as a primary, secondary, or associate sponsor any other  company reasonably deemed to be competitive with Prolong products.

       8.  Confidentiality. During and after the term of this Agreement, each             --------------- party hereto, its employees and agents agree not to disclose any business  results, trade practices or other business information of the other party, its  employees or agents, which they may learn as a result of the performance of this Agreement.

       9.  Indemnification.            ---------------          A.  Sabco shall indemnify, defend and hold harmless Prolong, its         officers, directors, employees and representatives from and against any        and all losses, claims, suits, damages, liabilities, costs and expenses,        including attorney fees and count costs incurred by any of them arising        out of:

(i)        Any breach of any warrant made by Sabco herein;

(ii)       Any acts done or words spoken

(iii)      Any claims by any persons arising from acts or omissions of any            nature by Sabco, its employees or agents, including but not limited            to, claims arising during the court of competition or practice in the            performance of this Agreement.

       B.  Prolong shall indemnify, defend and hold harmless Sabco, its  officers, directors, employees and representatives, from and against any and all losses, claims, suits, damages, liabilities, costs and expenses, including  attorney fees and court costs incurred by any of them, arising out of:

(i)        The use of any logo, design or materials furnished to Sabco by             Prolong hereunder;

(ii)       Any breach of any warranty made by Prolong herein;

(iii)      Any acts done or words spoken by Prolong, its officers, directors,             agents, employees and representatives;

(iv)       Any claims by any persons arising from acts of omissions of any        nature by Prolong, its officers, directors, agents, employees or        representatives, including, but not limited to, claims arising under any        product liability theory with respect to Prolong's products.

       10. Nature of Relationship. The parties expressly acknowledge and agree             ---------------------- that Sabco is acting as an independent contractor. Each party is responsible for all taxes relating to its operation, including payroll taxes for its employees,  and nothing in this Agreement is intended to create a relationship, express or





implied, of employer-employee between Sabco and Prolong. Except as expressly  authorized herein, neither party may contract for or otherwise obligate the  other party without the party's prior express written consent.

       11.  Insurance.  Sabco shall provide at its expense and maintain throughout           --------- the term of this Agreement and any option period spectator liability insurance  in an amount not less than $1 million single limit coverage with respect to any  liability relating to the activities of Sabco in the performance of this  Agreement.  Sabco shall, within 90 days of the execution of this Agreement,  supply Prolong with a copy of such policy of insurance or a certificate thereof, and such policies shall be cancelable only upon 10 days written notice to  Prolong.

     12.  Notices, Statements and Payments.  All notices, statements and            -------------------------------- payments required under this Agreement shall be sent to the parties at the  following addresses:

SABCO RACING, INC. 114 Meadow Hill Circle Mooresville, North Carolina 28115 Attn:  Felix Sabates

PROLONG SUPER LUBRICANTS 1210 North Barsten Way Anaheim, California 92806 Attn: Jerry Grant

All notices, statements and payments shall be deemed delivered when deposited  in the United States mail postage prepaid, when hand delivered if delivered  personally, when telecopied if the sender's telecopier confirms transmission  (with respect to notices and statements) or when wire transferred in federal  funds (with respect to payments).

     13.  Waivers.  A waiver of any provision of this Agreement shall be            -------- enforceable only if the waiver is in writing signed by the party against whom  the waiver is sought to be enforced.  A failure by a party at any time to  exercise any rights hereunder shall not constitute a waiver of such rights at  another time.

     14.  Entire Agreement.  This Agreement contains the entire agreement and            ---------------- understanding between the parties with respect to the subject matter hereof and  supersedes all prior written or oral agreements between them with respect to the subject matter hereof.

     15.  Assignment.  This Agreement may not be assigned by either party            ---------- without the prior written consent of the other party.

     16.  Significance of Headings.  Paragraph headings contained herein are            ------------------------ solely for the purpose of aiding the speedy location of subject matter and are  not in any sense to be given weight in the construction of this Agreement.   Accordingly, in case of any question with respect to the construction of this  Agreement, it is to be construed as though paragraph headings had been omitted.

     17.  Governing Law, Jurisdiction and Venue.  This Agreement shall be            ------------------------------------- governed by and construed in accordance with the substantive laws of the State  of North Carolina.  The parties hereto hereby submit to jurisdiction and venue  in any state or federal court located in North Carolina as well as any other  jurisdiction having venue and competent jurisdiction of any law suit arising out of or relating to this Agreement; provided, however, if any

  proceedings are instituted in a jurisdiction other than North Carolina, any  party may remove such proceeding to any State or Federal Court in North  Carolina.

       18.  Further Execution; Cooperation. The parties agree to execute and              ------------------------------ deliver such further agreements, instruments and other documents as the other  party may reasonably deem necessary to effectuate the purposes and provisions of this Agreement. The parties further agree to cooperate with each other in any  manner reasonably requested by the other party to effectuate the purposes and  provisions of this Agreement.

       19.  Counterparts. This Agreement may be executed in counterparts and the             ------------ signature page of any party, and photocopies and facsimiles thereof, may be  appended to any counterpart and when so appended shall constitute an original  signature.

               IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be  executed by their duly elected officers as of the day and year first above  written.





                               SABCO RACING, INC. ATTEST:                                                                 BY /s/ Armando Fitz                                   -------------------------------- /s/ Jerry Grant                Armando Fitz - Vice President Business Operations - --------------------------    Jerry Grant - Secretary

                               PROLONG SUPER LUBRICANTS ATTEST:

                               BY /s/ Elton Alderman /s/ ILLEGIBLE                     --------------------------------- - --------------------------              Elton Alderman - President                  Secretary
answer:
Highlight the parts (if any) of this contract related to Insurance that should be reviewed by a lawyer. Details: Is there a requirement for insurance that must be maintained by one party for the benefit of the counterparty?


question:
Exhibit 10.36 [Pursuant to Item 601(b)(10) of Regulation S-K, certain confidential portions of this exhibit have been omitted by means of marking such portions with asterisks as the identified confidential portions (i) are not material and (ii) would be competitively harmful if publicly disclosed.] MANUFACTURING AND SUPPLY AGREEMENT (DA-9801 Licensed Products) Between DONG-A ST CO., LTD. And NEUROBO PHARMACEUTICALS, INC. Dated: September 28, 2018

Source: NEUROBO PHARMACEUTICALS, INC., S-4, 9/3/2019





MANUFACTURING AND SUPPLY AGREEMENT (DA-9801 Licensed Products) This MANUFACTURING AND SUPPLY AGREEMENT (this Agreement) is made and entered into as of September 28, 2018 (Effective Date) by and between: Dong-A ST Co., Ltd., a corporation duly incorporated under the laws of the Republic of Korea, having its principal place of business at 64 Cheonho-daero, Dongdaemun-gu, Seoul 02587, Republic of Korea (Dong-A) and NeuroBo Pharmaceuticals, Inc., a corporation duly incorporated under the laws of the State of Delaware, having its principal place of business at 177 Huntington Avenue, Suite 1700, Boston, MA 02115, U.S.A. (NeuroBo). RECITALS WHEREAS, Dong-A and NeuroBo entered into the License Agreement (DA-9801) dated January 18, 2018, as amended by the Amendment to License Agreement (DA-9801) dated April 18, 2018 (the License Agreement) whereby Dong-A granted to NeuroBo an exclusive license under the Licensed Technology in the Field and in the Territory, to make, use, offer to sell, sell and import the Licensed Products (as defined by the License Agreement); WHEREAS, NeuroBo wishes that Dong-A manufacture and supply to NeuroBo the entire requirement of the Licensed Products and their matching placebo for the purpose of research and development of the Licensed Products, including the use in phase III clinical trials to be conducted by NeuroBo for the purpose of obtaining the NDA in the Territory, pursuant to the License Agreement; WHEREAS, NeuroBo wishes that Dong-A supply to NeuroBo the Licensed Products and their matching placebo already manufactured by Dong-A as of the Effective Date in compliance with the Korea Good Manufacturing Practices promulgated by the Governmental Authority in the Republic of Korea (the KGMP) and the Licensed Products and/or their matching placebo to be manufactured by Dong-A after the Effective Date in compliance with the KGMP; and WHEREAS, Dong-A agrees (i) to supply to NeuroBo the Licensed Products and their matching placebo already manufactured by Dong-A as of the Effective Date in compliance with the KGMP, and (ii) to manufacture and supply to NeuroBo the Licensed Products and their matching placebo in compliance with the KGMP, and NeuroBo agrees to purchase from Dong-A, the Licensed Products and/or their matching placebo for research and development, on the terms and conditions hereinafter set forth. NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Dong-A and NeuroBo mutually agree as follows: 1. DEFINITIONS Unless otherwise defined in this Agreement, the capitalized terms utilized herein shall have 1

Source: NEUROBO PHARMACEUTICALS, INC., S-4, 9/3/2019





the same meanings as defined in the License Agreement. 2. MANUFACTURE AND SUPPLY 2.1 Subject to the provisions hereof, Dong-A shall (i) supply to NeuroBo the Licensed Products and their matching placebo already manufactured by Dong-A as of the Effective Date in compliance with the KGMP, and (ii) manufacture in compliance with the KGMP and in conformity with the specifications separately agreed upon between the Parties and attached hereto as Exhibit A (the Product Specifications) and supply to NeuroBo the Licensed Products and/or their matching placebo, and NeuroBo shall purchase from Dong-A the entire requirement of the Licensed Products and/or their matching placebo for research and development of the Licensed Products under the License Agreement. 2.2 NeuroBo shall manufacture, or have manufactured, and supply to Dong-A the active pharmaceutical ingredients (API), which are necessary to manufacture the Licensed Products, in the quantity and in conformity with the specifications separately agreed upon between the Parties and attached hereto as Exhibit C (the API Specifications) as may be amended by the Parties's agreement in writing from time to time. 2.3 NeuroBo shall, at its costs and expenses, deliver the API to the place designated by Dong-A no later than [***] days prior to the requested delivery date for the Licensed Products and/or their matching placebo in accordance with the Firm Order. 2.4 Within [***] days after receipt of the API from NeuroBo, Dong-A shall perform quality control test (the API Test) in accordance with the methods of the API Test on such API for acceptance (the API Test Methods), which shall be separately agreed in writing by and between the Parties and attached hereto as Exhibit D) as may be amended by the Parties's agreement in writing from time to time. NeuroBo shall provide Dong-A with all available information and technical assistance necessary for Dong-A to perform the API Test expeditiously. If the API Test indicates that the API is deficient in quantity or does not meet the API Specifications, Dong-A shall notify NeuroBo thereof in writing within the [***]-day period together with results of the API Test. If the quantity is deficient, NeuroBo shall, as soon as commercially reasonable, ship, or have shipped, the sufficient amount of additional API to cover the deficiency. If the API does not meet the API Specifications, NeuroBo shall retrieve the API at its own expense and replace the API at no additional cost to Dong-A. 2.5 Upon [***] days' notice and at time mutually agreed upon by the Parties during Dong-A's normal business hours, but no more frequently than [***] every year during the term of this Agreement, NeuroBo may, at its cost and expense, inspect Dong-A's manufacturing facilities where the Licensed Products are manufactured. Within [***] days after the completion of the inspection, NeuroBo shall provide a written report detailing the results of such audit to Dong-A. In case of any inspection by any Governmental Authority of Dong-A's manufacturing facilities where the Licensed Products are manufactured, NeuroBo shall promptly provide Dong-A with a notice of the inspection and all notices, correspondence and related documents received from or sent to the applicable Governmental Authority. Dong-A shall permit such Governmental Authority to inspect the facilities to the fullest extent permitted by Laws and shall make its [***] and cooperate with the Governmental Authority in conducting the inspection. NeuroBo shall provide 2

such assistance as reasonably requested by Dong-A for the preparation of and during such inspection and furnish Dong-A with copies of all reports and notices received as a result of any such inspection. NeuroBo agrees that Dong-A shall not be obligated to correct any deficiencies documented by the Governmental Authority as a result of any such inspection. NeuroBo further agrees that it shall not hold Dong-A responsible nor shall bring any claims or actions against Dong-A for any such deficiencies and/or costs or damages NeuroBo may incur resulting therefrom. Upon request of Dong-A, the Parties may discuss in good faith a plan for NeuroBo to assist in correcting such deficiencies and the terms and conditions for implementing the corrective actions under such plan. 2.6 The Parties acknowledge and agree that prior to commercialization of the Licensed Products by NeuroBo, its Affiliates and/or sublicensees, the Parties shall, in good faith, negotiate the terms and conditions for, including, without limitation, the supply price, and enter into a definitive non-exclusive supply agreement pursuant to which Dong-A shall supply to NeuroBo the Licensed Products for the commercialization by NeuroBo, its Affiliates and/or sublicensees of the Licensed Products in the Field in the Territory pursuant to the License Agreement. 2.7 In case NeuroBo requests Dong-A to conduct any additional activities, including testing (e.g. AMV, PV), documentation (e.g. CMC packaging), which NeuroBo requires for obtaining the NDA for the Licensed Product in the Territory, the Parties shall, in good faith, negotiate the terms and conditions, including, without limitation, the costs and expenses for conducting such additional testing activities of the Licensed Products and/or their matching placebo. For any such activities, NeuroBo shall pay to Dong-A [***] ([***]%) of the fees as agreed by the Parties within [***] days prior to conducting such activities by Dong-A, and shall pay the balance due within [***] days after delivery by Dong-A to NeuroBo of the deliverables as agreed by the Parties. 3. ORDERING AND DELIVERY 3.1 NeuroBo shall submit to Dong-A an order for the Licensed Products and/or their matching placebo no later than [***] days prior to the requested delivery date thereof. For each order, NeuroBo shall be obligated to order the Licensed Products and/or their matching placebo in [***] tablets. NeuroBo acknowledges and agrees that certain quantity of the Licensed Products and/or their matching placebo from each batch ordered shall be retained by Dong-A for use in the stability tests and as retention samples, and NeuroBo shall order the Licensed Products and/or their matching placebo in consideration of such quantity to be retained by Dong-A. Each order shall specify at least (i) the quantity of the Licensed Products and/or their matching placebo, (ii) the specifications of the Licensed Products and/or their matching placebo, including the specifics of packaging, (iii) the expected delivery date for the API, (iv) the requested delivery date for the Licensed Products and/or their matching placebo, (v) the shipment terms for the Licensed Products and/or their matching placebo and (vi) the supply price for the Licensed Products and/or their matching placebo. Upon receipt of the order from NeuroBo, Dong-A shall promptly acknowledge the receipt of such order. No order shall be binding upon the Parties until agreed in writing by Dong-A and NeuroBo; provided, however, that such agreement shall not be unreasonably withheld or delayed. Upon such agreement, the order shall be deemed to be the Firm Order which shall be binding and may only be revised by agreement of the Parties in writing. Dong-A shall deliver the Licensed Products and/or their matching placebo to NeuroBo in accordance with the Firm 3

Source: NEUROBO PHARMACEUTICALS, INC., S-4, 9/3/2019





Order on the shipment terms of [***] manufacturing facility of Dong-A (ICC Incoterms 2010), including the delivery date and place set forth therein, within the later of (i) [***] days after the date of the Firm Order and (ii) [***] days after the date of acceptance by Dong-A of the API. 3.2 Dong-A shall supply NeuroBo with the Licensed Products and/or their matching placebo together with a certificate of analysis, as described in the Product Specifications, for each batch of the Licensed Products and/or their matching placebo shipped hereunder certifying that such batch of the Licensed Products and/or their matching placebo meets the Product Specifications. 3.3 Within [***] days after receipt of the Licensed Products and/or their matching placebo hereunder, NeuroBo may, in its discretion, perform a quality control test (the Product Test) in accordance with the methods of the test on such Licensed Products and/or their matching placebo for acceptance (the Product Test Methods), which shall be separately agreed in writing by and between Dong-A and NeuroBo and attached hereto as Exhibit B, as may be amended by the Parties' agreement in writing from time to time. Dong-A shall provide NeuroBo with all available information and technical assistance necessary for NeuroBo to perform the Product Test expeditiously. If the Product Test indicates that the Licensed Products and/or their matching placebo is deficient in quantity or does not meet the Product Specifications, NeuroBo shall notify Dong-A thereof in writing within the [***]-day period together with results of the Product Test. If the quantity is deficient, Dong-A shall immediately ship the sufficient amount of additional Licensed Products and/or their matching placebo to cover the deficiency. If Dong-A does not agree that the Licensed Products and/or their matching placebo does not meet the Product Specifications, the Parties shall refer their disagreement for decision by an independent testing laboratory agreed by the Parties. The decision by the independent testing laboratory shall be conclusive and binding on both Parties, and the losing Party shall bear the costs of the independent testing laboratory. If Dong-A agrees that the Licensed Products and/or their matching placebo does not meet the Product Specifications, or if the decision by the testing laboratory confirms that the Licensed Products and/or their matching placebo does not meet the Product Specifications, (i) Dong-A shall arrange for the return from NeuroBo of the Licensed Products and/or their matching placebo at Dong-A's expense, and (ii) without waiting for the return, Dong-A shall promptly replace the Licensed Products and/or their matching placebo at no additional cost to NeuroBo. 4. TERMS AND CONDITIONS OF SALE 4.1 The terms and conditions of sale and purchase of the Licensed Products and/or their matching placebo between Dong-A and NeuroBo shall be set forth in each Firm Order. 4.2 The supply prices for the Licensed Products and their matching placebo shall be specified in Schedule 4.2. 4.3 Upon agreement by the Parties of the Firm Order, Dong-A shall issue to NeuroBo an invoice in Korean Won for each shipment of the Licensed Products and/or their matching placebo based on the Firm Order. Unless otherwise agreed in writing by Dong-A, NeuroBo shall pay the invoiced supply price (i) in Korean Won (KRW) or (ii) in United States Dollars (USD) which amount shall correspond the invoiced amount converted from KRW to USD at the exchange rate of the payment date, no later than [***] days prior to the shipment date by way of wire transfer 4

Source: NEUROBO PHARMACEUTICALS, INC., S-4, 9/3/2019





to Dong-A. NeuroBo shall be responsible for and pay all wire transfer fees incurred in the Territory. If Dong-A does not receive payment of any sum due to it on or before the due date, [***] interest shall thereafter accrue on the sum due to until the date of payment at the [***] rate of [***] percent ([***]%) over the then-current prime rate quoted by Citibank in New York, New York or the maximum rate allowable by New York law, whichever is lower. 4.4 Dong-A shall not be responsible for any taxes levied on account of the payments under this Agreement. In the event that any taxes are required to be paid on account of any payment hereunder, NeuroBo shall pay all such taxes. 4.5 In performing its obligations under this Agreement, NeuroBo shall, and shall cause its Affiliates and sublicensees to, comply with all applicable laws, including any applicable anti-corruption or anti-bribery laws or regulation, of any governmental authority with jurisdiction over the activities performed by NeuroBo or its Affiliates or sublicensees in furtherance of such obligations. 5. TERM AND TERMINATION 5.1 This Agreement shall commence on the Effective Date and, unless earlier terminated, shall continue in full force and effect for a period of [***] years thereafter. 5.2 This Agreement shall automatically terminate in case the License Agreement is terminated for any reason specified therein. 5.3 A Party may terminate this Agreement by notice to the other Party if the other Party is in material breach of any provision of this Agreement, and (a) the breaching Party has not cured the breach within [***] days after receiving notice from the terminating Party; or (b) if the breach cannot reasonably be cured within the [***]-day period, the breaching Party has not started to remedy the breach within the [***]-day period and diligently endeavored to cure the breach within a reasonable time thereafter. 5.4 Either Party may terminate this Agreement immediately upon notice to the other Party in the event that (a) the other Party is the subject of a petition for bankruptcy, reorganization, or arrangement, whether voluntary or involuntary, and the same is not dismissed within thirty (30) days thereof, (b) a receiver or trustee is appointed for all or a substantial portion of the assets of the other Party, or (c) the other Party makes an assignment for the benefit of its creditors. 5.6 The termination or expiration of this Agreement, in whole or in part, shall be without prejudice to the right of either Dong-A and NeuroBo to receive all payments accrued and unpaid at the effective date of such termination or expiration, without prejudice to the remedy of either Dong-A and NeuroBo in respect to any previous breach of any of the representations, warranties, covenants or obligations herein contained and without prejudice to any other provisions hereof which expressly or necessarily call for performance after such termination or expiration. 5

Source: NEUROBO PHARMACEUTICALS, INC., S-4, 9/3/2019





6. GOVERNING LAW The laws of the State of New York (without giving effect to its conflicts of law principles) govern all matters arising out of or relating to this Agreement and all of the transactions it contemplates, including without limitation, its validity, interpretation, construction, performance, and enforcement. 7. NOTICES All notices, consents, and approvals under this Agreement must be delivered in writing by courier, electronic facsimile (fax), or certified or registered mail, (postage prepaid and return receipt requested) to the other Party; and shall be effective upon receipt or three (3) business days after being deposited in the mail, whichever occurs sooner. Notices to the Parties shall be sent to the addresses set forth at the beginning of this Agreement. Notice of change of address shall be given in the same manner as other communications. 8. INCORPORATION BY REFERENCE Articles or Sections 8.2 (Limitation of Liability), 9 (Indemnification), 12.2 (Force Majeure), 12.3 (Assignment), 12.4 (Severability), 12.6 (Remedies), 12.8 (Submission to Jurisdiction/Waiver of Jury Trial), 12.9 (Independent Contractor/No Agency), 12.10 (Entire Agreement) of the License Agreement shall be deemed to be incorporated herein by reference as it is set forth in this Agreement <Signature page follows.> 6

Source: NEUROBO PHARMACEUTICALS, INC., S-4, 9/3/2019





IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of the Effective Date. DONG-A ST CO., LTD. By: /s/ Daesik Eom Daesik Eom, Chairman and CEO NEUROBO PHARMACEUTICALS, INC. By: /s/ John L. Brooks, III John L. Brooks III, President & CEO 7

Exhibit A Product Specifications

Test Analytical Method Specification Requirements [***] [***] [***]

[***] [***] [***][***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] Schedule 1-1

Source: NEUROBO PHARMACEUTICALS, INC., S-4, 9/3/2019





Exhibit B Product Test Methods [***] Schedule 1-2

Source: NEUROBO PHARMACEUTICALS, INC., S-4, 9/3/2019





Exhibit C API Specifications

Test Analytical Method Specification Requirements [***] [***] [***]

[***] [***] [***][***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] Schedule 1-3

Exhibit D API Test Methods [***] Schedule 1-4

Source: NEUROBO PHARMACEUTICALS, INC., S-4, 9/3/2019





Schedule 4.2 Supply Price [***] Schedule 1-5

Source: NEUROBO PHARMACEUTICALS, INC., S-4, 9/3/2019
answer:

Highlight the parts (if any) of this contract related to Warranty Duration that should be reviewed by a lawyer. Details: What is the duration of any  warranty against defects or errors in technology, products, or services  provided under the contract?