Document:

Net 1 UEPS Technologies, Inc.: Exhibit 10.42 - Filed by newsfilecorp.com

Exhibit 10.41
EXECUTION

SUBORDINATION AGREEMENT 

 

DATED 20 OCTOBER, 2016 

between 

NET1 APPLIED TECHNOLOGIES SOUTH AFRICA PROPRIETARY LIMITED

(as Borrower)

NET1 UEPS TECHNOLOGIES, INC. 
(as Holdco)

THE PERSONS LISTED IN SCHEDULE 1 
(as Original
Subordinated Creditors)

THE PERSONS LISTED IN SCHEDULE 2 
(as Original
Intergroup Debtors)

THE PERSONS LISTED IN SCHEDULE 3 
(as Original Senior
Creditors)

 

with 

FIRSTRAND BANK LIMITED 
(ACTING THROUGH ITS RAND
MERCHANT BANK DIVISION) 
(as Facility Agent)

 

CONTENTS 

	Clause 	  	Page
	  	  	  	  
	1.
      	Interpretation
      	1
      
	2.
      	Subordination
      	3
      
	3.
      	Undertakings
      	4
      
	4.
      	Insolvency
      	5
      
	5.
      	Enforcement
      	6
      
	6.
      	Turnover
      of Non-permitted Recoveries 	7
      
	7.
      	Amendments
      to the Subordinated Documents 	8
      
	8.
      	Consents
      	8
      
	9.
      	Protection
      of Subordination and Priority 	8
      
	10.
      	Representations
      and Warranties 	9
      
	11.
      	Information
      by Subordinated Creditors 	11
      
	12.
      	Preservation
      of Subordinated Debt 	11
      
	13.
      	Treatment
      of Distributions 	12
      
	14.
      	Responsibility
      of the Facility Agent 	12
      
	15.
      	Changes
      to the Parties 	12
      
	16.
      	Power
      of Attorney 	13
      
	17.
      	Set-off
      	  	13
      
	18.
      	Default
      Interest 	14
      
	19.
      	Calculations
      and Certificates 	14
      
	20.
      	Notices
      and Domicilia 	14
      
	21.
      	Miscellaneous
      Matters 	16
      
	Schedule
      1 	The
      Original Subordinated Creditors 	19
      
	Schedule
      2 	The
      Original Intergroup Debtors 	20
      
	Schedule
      3 	The
      Original Senior Creditors 	21
      
	Schedule
      4 	Conditions
      Precedent 	22
      
	Schedule
      5 	Form
      of Accession Letter 	24
      
	  	  	  	  
	Signature
      Page 	  	27
      

THIS AGREEMENT is made between: 

	(1) 	
      NET1 APPLIED TECHNOLOGIES SOUTH AFRICA PROPRIETARY
      LIMITED, registration number 2002/031446/07 (the
    Borrower);

	 	 
	(2) 	
      NET1 UEPS TECHNOLOGIES, INC., a Florida
      corporation (Holdco);

	 	 
	(3) 	
      THE PERSONS LISTED IN SCHEDULE 1 (The Original
      Subordinated Creditors) as subordinated creditors (in this capacity, the
      Original Subordinated Creditors);

	 	 
	(4) 	
      THE PERSONS LISTED IN SCHEDULE 2 (The Original
      Intergroup Debtors) as intergroup debtors (in this capacity, the
      Intergroup Debtors);

	 	 
	(5) 	
      THE PERSONS LISTED IN SCHEDULE 3 (The Original
      Senior Creditors) as senior creditors (in this capacity, the Original
      Senior Creditors); and

	 	 
	(6) 	
      FIRSTRAND BANK LIMITED as facility agent of the
      other Finance Parties (the Facility Agent).

IT IS AGREED as follows: 

BACKGROUND: 

	(A) 	
      The Intergroup Debtors and the Subordinated Creditors
      enter into this Agreement in connection with the Finance Documents (as
      defined in the Common Terms Agreement, as defined below).

	 	 
	(B) 	
      Each Subordinated Creditor has agreed to subordinate its
      Subordinated Debt (as defined below) to the Senior Debt (as defined below)
      on the terms and conditions set out in this
Agreement.

	1. 	
      INTERPRETATION

	1.1 	
      Definitions

	 	 
		
      In this Agreement:

	1.1.1 	
      Accession Letter means, in relation to an
      Additional Intergroup Debtor and an Additional Subordinated Creditor, a
      document substantially in the form set out in Schedule 5 (Form of
      Accession Letter);

	 	 
	1.1.2 	
      Additional Intergroup Debtor means any person that
      accedes and becomes party to this Agreement as an Intergroup Debtor in
      accordance with Clause 15.2 (Changes to the Parties);

	 	 
	1.1.3 	
      Additional Subordinated Creditor means any person
      that accedes and becomes party to this Agreement as a Subordinated
      Creditor in accordance with Clause 15.3 (Changes to the
Parties);

	 	 
	1.1.4 	
      Common Terms Agreement means the common terms
      agreement dated on or about the Signature Date, between, amongst others,
      Net1 Applied Technologies South Africa Proprietary Limited (as borrower),
      Net1 UEPS Technologies, Inc. (as holdco), FirstRand Bank Limited (acting
      through its Rand Merchant Bank division) (as original senior lender),
      FirstRand Bank Limited (acting through its Rand Merchant Bank division)
      (as mandated lead arranger) and the Facility Agent (as agent of the other
      Finance Parties);

1 

	1.1.5 	
      Final Discharge Date means the "Final Discharge
      Date" as defined in the Common Terms Agreement;

	 	 
	1.1.6 	
      Intergroup Debt means all Liabilities payable or
      owing by any Intergroup Debtor to a Subordinated Creditor, and all the
      claims of a Subordinated Creditor against any Intergroup Debtor from time
      to time;

	 	 
	1.1.7 	
      Intergroup Debtors
means:

	 	(a) 	
      the Original Intergroup Debtors; and

	 	 	 
	 	(b) 	
      any Additional Intergroup Debtor,

and Intergroup Debtor, as the
context requires, means any of them; 

	1.1.8 	
      Liability means any present or future liability
      (actual or contingent), together with:

	 	(a) 	
      any permitted novation, deferral or extension of that
      liability;

	 	 	 
	 	(b) 	
      any further advance which may be made under any agreement
      expressed to be supplemental to any document in respect of that liability,
      together with all related interest, fees and costs;

	 	 	 
	 	(c) 	
      any claim for damages or restitution in the event of
      rescission of that liability or otherwise;

	 	 	 
	 	(d) 	
      any claim arising from any recovery by a payment or
      discharge in respect of that liability on grounds of preference or
      otherwise; and

	 	 	 
	 	(e) 	
      any amount which would be included in any of the above,
      but for its discharge, non-provability, unenforceability or
      non-allowability in any insolvency or other
proceedings;

	1.1.9 	
      Party means a party to this Agreement;

	 	 
	1.1.10 	
      Permitted Payment means a payment by the Borrower
      or an Intergroup Debtor to a Subordinated
Creditor:

	 	(a) 	
      which is permitted by clause 25.19 (Distributions) of the
      Common Terms Agreement; or

	 	 	 
	 	(b) 	
      made with the express prior written consent of the
      Facility Agent;

	1.1.11 	
      Proceeds Account means a dedicated, single-purpose
      proceeds account held in the name of a Subordinated Creditor with the
      Facility Agent;

	 	 
	1.1.12 	
      Senior Creditors
means:

	 	(a) 	
      the Original Senior Creditors; and

	 	 	 
	 	(b) 	
      any person which becomes party to the Common Terms
      Agreement and the Intercreditor Agreement as a Finance Party after the
      Signature Date, in accordance with the provisions of those
    agreements,

and Senior Creditor, as the
context requires, means any of them; 

2 

	1.1.13 	
      Senior Debt means all Liabilities payable or owing
      by any Obligor to a Senior Creditor, and all the claims of a Senior
      Creditor against any Obligor, from time to time;

	 	 
	1.1.14 	
      Shareholder Debt means all Liabilities payable or
      owing by the Borrower to Holdco, and all the claims of Holdco against the
      Borrower from time to time;

	 	 
	1.1.15 	
      Signature Date means the date on which, once this
      Agreement has been signed by all the Parties, it is signed by the last
      Party to do so;

	 	 
	1.1.16 	
      Subordinated Creditor
means:

	 	(a) 	
      each Original Subordinated Creditor; and

	 	 	 
	 	(b) 	
      any Additional Subordinated
Creditor,

and Subordinated Creditor, as
the context requires, means any of them; 

	1.1.17 	
      Subordinated Debt
means:

	 	(a) 	
      any Shareholder Debt; and

	 	 	 
	 	(b) 	
      any Intergroup Debt;

	1.1.18 	
      Subordinated Document means any document
      evidencing or recording the terms of, or any guarantee or Security for,
      any Subordinated Debt; and

	 	 
	1.1.19 	
      Subordination Period means the period beginning on
      the Signature Date and ending on the Final Discharge
  Date.

	1.2 	
      Construction

	1.2.1 	
      Unless expressly defined in this Agreement, terms and
      expressions defined in the Common Terms Agreement have the same meaning in
      this Agreement.

	 	 
	1.2.2 	
      The provisions of clause 1.3 (Construction) and 1.4
      (Third party rights) of the Common Terms Agreement apply to this Agreement
      as though they were set out in full in this Agreement, except that
      references to the Common Terms Agreement are to be construed as references
      to this Agreement.

	 	 
	1.2.3 	
      Any undertaking of the Borrower, a Intergroup Debtor or a
      Subordinated Creditor under this Agreement remains in force during the
      Subordination Period.

	 	 
	1.2.4 	
      If any amount paid to a Senior Creditor under a Finance
      Document is capable of being avoided or otherwise set aside on the
      liquidation or administration of the payer or otherwise, then that amount
      will not be considered to have been irrevocably discharged for the
      purposes of this Agreement.

	2. 	
      SUBORDINATION

	 	 
		
      At all times during the Subordination
  Period:

	2.1 	
      the Subordinated Debt is subordinate in right of payment
      to all Senior Debt, which (whether secured or unsecured) ranks in priority
      to the Subordinated Debt in all respects; and

3 

	2.2 	
      except for a Permitted Payment, a payment of any amount
      of the Subordinated Debt is conditional upon the Senior Debt having been
      irrevocably and unconditionally discharged in
full.

	3. 	
      UNDERTAKINGS

	3.1 	
      Undertakings of the Borrower and the Intergroup
      Debtors

	3.1.1 	
      Except as provided below, during the Subordination Period
      the Borrower and each Intergroup Debtor shall
not:

	 	(a) 	
      pay or repay or make any distribution in respect of, any
      Subordinated Debt owed by it whether in cash or kind from any
    source;

	 	 	 
	 	(b) 	
      allow any of its Affiliates to purchase or acquire any of
      the Subordinated Debt owed by it;

	 	 	 
	 	(c) 	
      allow any Subordinated Debt owed by it in respect of
      which Security has been granted for the benefit of a Senior Creditor to be
      discharged;

	 	 	 
	 	(d) 	
      allow to exist the benefit of any Security, guarantee,
      indemnity or other assurance against loss in respect of any Subordinated
      Debt owed by it;

	 	 	 
	 	(e) 	
      allow any Subordinated Debt owed by it to be evidenced by
      a negotiable instrument;

	 	 	 
	 	(f) 	
      allow any Subordinated Debt owed by it to be subordinated
      to any person other than in accordance with this Agreement; or

	 	 	 
	 	(g) 	
      take or omit to take any action which might impair the
      priority or subordination achieved or intended to be achieved by this
      Agreement.

	3.1.2 	
      Notwithstanding Clause 3.1.1 above, the Borrower and each
      Intergroup Debtor may:

	 	(a) 	
      make a Permitted Payment; and

	 	 	 
	 	(b) 	
      do anything prohibited by Clause 3.1.1 above with the
      express prior written consent of the Facility
Agent.

	3.2 	
      Undertakings of the Subordinated
  Creditors

	3.2.1 	
      Except as provided below, during the Subordination Period
      a Subordinated Creditor shall not:

	 	(a) 	
      demand or receive payment of, or any distribution in
      respect or on account of, any Subordinated Debt owed to it, whether in
      cash or in kind from any source;

	 	 	 
	 	(b) 	
      allow any Subordinated Debt owed to it in respect of
      which Security has been granted for the benefit of a Senior Creditor to be
      discharged;

	 	 	 
	 	(c) 	
      allow to exist or receive the benefits of any Security,
      guarantee, indemnity or other assurance against loss in respect of the
      Subordinated Debt owed to it;

	 	 	 
	 	(d) 	
      allow any Subordinated Debt owed to it to be evidenced by
      a negotiable instrument;

4 

	 	(e) 	
      allow any Subordinated Debt owed to it to be subordinated
      to any person otherwise than in accordance with this Agreement;

	 	 	 
	 	(f) 	
      take or omit to take any action which might impair the
      priority or subordination achieved or intended to be achieved by this
      Agreement.

	3.2.2 	
      Notwithstanding Clause 3.2.1 above, a Subordinated
      Creditor may:

	 	(a) 	
      receive and retain for its own benefit a Permitted
      Payment; and

	 	 	 
	 	(b) 	
      do anything prohibited by Clause 3.2.1 above with the
      express prior written consent of the Facility
Agent.

	4. 	
      INSOLVENCY

	 	 
		
      In this Clause 4 (Insolvency), Insolvency Event
      means:

	4.1 	
      any resolution is passed or order made for a winding-up,
      bankruptcy, liquidation, dissolution, administration, business rescue,
      re-organisation or moratorium of or in respect of the Borrower or an
      Intergroup Debtor, or any analogous proceedings affecting the Borrower or
      an Intergroup Debtor in any jurisdiction; or

	 	 
	4.2 	
      the Borrower or any Intergroup Debtor enters into any
      composition or arrangement with its creditors generally; or

	 	 
	4.3 	
      any event analogous to any of the foregoing occurs in
      relation to the Borrower or an Intergroup Debtor or its assets in any
      jurisdiction.

	 	 
	4.4 	
      Filing of claims

	4.4.1 	
      Subject to Clause 4.4.2 below, if an Insolvency Event
      occurs, each Subordinated Creditor undertakes in favour of the Senior
      Creditors that it will not, at any time during the Subordination Period,
      without the express prior written consent of the Facility
  Agent:

	 	(a) 	
      claim, enforce and prove for any Subordinated Debt owed
      to it by an Intergroup Debtor;

	 	 	 
	 	(b) 	
      exercise any powers of convening meetings, voting and
      representation in respect of the Subordinated Debt owed to it by an
      Intergroup Debtor;

	 	 	 
	 	(c) 	
      file claims and proofs, give receipts and take any
      proceedings in respect of the Subordinated Debt owed to it by an
      Intergroup Debtor;

	 	 	 
	 	(d) 	
      do anything to recover the Subordinated Debt owed to it
      by an Intergroup Debtor; and

	 	 	 
	 	(e) 	
      receive any distributions on or in respect of the
      Subordinated Debt owed to it by an Intergroup
Debtor.

	4.4.2 	
      If an Insolvency Event occurs, a Subordinated Creditor
      may, subject to Clause 4.5 below, if it has given the Facility Agent not
      less than 15 Business Days express prior written notice, enforce and prove
      for the Subordinated Debt owed to it by an Intergroup Debtor and take any
      action referred in Clause 4.4.1 if, should it fail to do or take those
      actions, it will permanently lose its right to claim. If a Subordinated
      Creditor elects to do or take any such action, it must do so in a timely
      manner and as directed by the Facility Agent.

5 

	4.4.3 	
      Each Subordinated Creditor hereby cedes in securitatem
      debiti to the Senior Creditors, individually and collectively, as a
      continuing general covering security for the due, proper and timeous
      payment in full of all the payment obligations of an Intergroup Debtor to
      the Senior Creditors under this Agreement, all its rights, title and
      interest in and to any and all claims that such Subordinated Creditor has
      against an Intergroup Debtor, as a result of exercising its rights under
      this Clause 4.4, which cession in security the Senior Creditors hereby
      accept. To the extent necessary, the Borrower and each Intergroup Debtor
      hereby consent to any splitting of claims which may arise as a result of
      the cession contained in this Clause.

	4.5 	
      Distributions

	 	 
		
      Until the Final Discharge Date, each Subordinated
      Creditor must:

	4.5.1 	
      direct the trustee in bankruptcy, liquidator or other
      person distributing the assets of the Borrower or any Intergroup Debtor or
      their proceeds, to pay all payments and distributions on the Subordinated
      Debt owed to it directly to the Facility Agent until the Senior Debt has
      been paid in full;

	 	 
	4.5.2 	
      hold all payments and distributions (other than a
      Permitted Payment) in cash or in kind received or receivable by it or on
      its behalf in respect of the Subordinated Debt owed to it (whether from
      the Borrower, an Intergroup Debtor or from any other source) for the
      benefit of the Senior Creditors, and deposit all amounts received in cash
      into the Proceeds Account;

	 	 
	4.5.3 	
      upon demand by the Facility Agent, immediately pay and
      transfer to the Facility Agent an amount equal to the amount of all
      payments and distributions (other than any Permitted Payment) received in
      respect of Subordinated Debt owed to it (up to a maximum of an amount
      equal to the Senior Debt) for application against the Senior Debt;
    and

	 	 
	4.5.4 	
      give any notice and do anything which the Facility Agent
      (acting reasonably) may direct to give effect to this Clause
  4.

	4.6 	
      Security cession in respect of Proceeds
    Account

	4.6.1 	
      Each Subordinated Creditor cedes in securitatem
      debiti, individually and collectively, as a continuing general
      covering security for the due, proper and timeous payment in full of all
      the payment obligations of the Subordinated Creditors to the Senior
      Creditors under this Agreement, all its rights, title and interest in and
      to its Proceeds Account and any monies standing to the credit of its
      Proceeds Account, which cession in security the Senior Creditors hereby
      accept. To the extent necessary, the Borrower and each Intergroup Debtor
      hereby consent to any splitting of claims which may arise as a result of
      the cession contained in this Clause.

	 	 
	4.6.2 	
      Each Subordinated Creditor agrees that it may not
      encumber, withdraw or transfer any amount from its Proceeds Account,
      except as required under this Agreement or with the express prior written
      consent of the Facility Agent.

	5. 	
      ENFORCEMENT

	5.1 	
      Enforcement by the Subordinated
Creditors

	 	 
		
      During the Subordination Period a Subordinated Creditor
      shall not:

6 

	5.1.1 	
      accelerate any of the Subordinated Debt owed to it or
      otherwise declare any of that Subordinated Debt prematurely due and
      payable;

	 	 
	5.1.2 	
      obtain or enforce any judgment against any Intergroup
      Debtor in respect of the Subordinated Debt owed to it;

	 	 
	5.1.3 	
      enforce any Security created in its favour or for its
      benefit by any Subordinated Document;

	 	 
	5.1.4 	
      initiate or support or take any steps with a view
    to:

	 	(a) 	
      any insolvency, liquidation, reorganisation, business
      rescue, administration or dissolution proceedings; or

	 	 	 
	 	(b) 	
      any voluntary arrangement or assignment for the benefit
      of creditors; or

	 	 	 
	 	(c) 	
      any similar proceedings,

involving any Intergroup Debtor,
whether by petition or an application to court, convening a meeting, voting for
a resolution or otherwise; or 

	5.1.5 	
      bring or support any legal proceedings against any
      Intergroup Debtor (or any of its Subsidiaries); or

	 	 
	5.1.6 	
      otherwise exercise any remedy for the recovery of the
      Subordinated Debt (except as provided in Clause 4.4.2 (Filing of claims)
      above).

	5.2 	
      Enforcement by Senior Creditors

	 	 
		
      The Senior Creditors, or any one of them, may enforce, or
      refrain from enforcing, their rights under the Finance Documents and the
      Transaction Security created by any Security
Agreement:

	5.2.1 	
      in such manner as they see fit;

	 	 
	5.2.2 	
      solely having regard to their interests;

	 	 
	5.2.3 	
      without any liability or duty to the Subordinated
      Creditors.

	6. 	
      TURNOVER OF NON-PERMITTED
  RECOVERIES

	6.1 	
      Non-permitted payment

	 	 
		
      If a Subordinated Creditor:

	6.1.1 	
      receives a payment or distribution in respect of any of
      the Subordinated Debt from any Intergroup Debtor or any other source other
      than as allowed under this Agreement; or

	 	 
	6.1.2 	
      receives the proceeds of any enforcement of any Security
      or any guarantee or other assurance against financial loss for any
      Subordinated Debt other than as allowed under this
  Agreement,

that Subordinated Creditor must
receive and hold the amount received by it (up to a maximum of an amount equal
to the Senior Debt) for the benefit of the Senior Creditors and within 5
Business Days pay that amount (up to that maximum) to the Facility Agent for
application against the Senior Debt. 

7 

	6.2 	
      Non-permitted discharge

	 	 
		
      If, for any reason, any Subordinated Debt owed to a
      Subordinated Creditor is discharged in any manner other than as allowed
      under a Finance Document, that Subordinated Creditor must pay an amount
      equal to the amount discharged (up to a maximum of an amount equal to the
      Senior Debt) to the Facility Agent within 5 Business Days of receipt for
      application against the Senior Debt.

	7. 	
      AMENDMENTS TO THE SUBORDINATED DOCUMENTS

	 	 
		
      Neither the Parent nor any Subordinated Creditor may
      amend, waive or release any term of a Subordinated Document, except for an
      amendment which:

	7.1 	
      is a procedural, administrative or other change;
    and

	 	 
	7.2 	
      does not prejudice any Senior Debt, any Senior Creditor
      or impair the subordination achieved or intended to be achieved by this
      Agreement.

	8. 	
      CONSENTS

	8.1 	
      No Subordinated Creditor will have any remedy or claim
      against any Intergroup Debtor or any Senior Creditor by reason of any
      transaction entered into between a Senior Creditor, the Borrower and/or
      any Intergroup Debtor (including any Finance Document) which may conflict
      with or constitute a default under any Subordinated Document.

	 	 
	8.2 	
      Any waiver or consent granted by or on behalf of a Senior
      Creditor in respect of any Finance Document will be deemed to have been
      given also by each Subordinated Creditor, if any transaction or
      circumstances would, in the absence of such a waiver or consent by that
      Subordinated Creditor, conflict with a term of or constitute a default
      under any Subordinated Document.

	9. 	
      PROTECTION OF SUBORDINATION AND
  PRIORITY

	9.1 	
      Continuing subordination

	 	 
		
      The subordination and priority provisions in this
      Agreement constitute continuing subordination and priority undertakings
      and, until the Final Discharge Date, will benefit the ultimate balance of
      all of the Senior Debt, regardless of any intermediate payment or
      discharge in whole or in part.

	 	 
	9.2 	
      Waiver of defences

	 	 
		
      The subordination and priority in this Agreement and the
      obligations of each Subordinated Creditor under this Agreement will not be
      affected by any act, omission, matter or thing (whether or not known to
      the Subordinated Creditors or any Senior Creditor) which, but for this
      provision, would reduce, release or prejudice the subordination or any of
      those obligations. This includes:

	9.2.1 	
      any time or waiver granted to, or composition with, any
      person;

	 	 
	9.2.2 	
      any release of any person under the terms of any
      composition or arrangement;

	 	 
	9.2.3 	
      the taking, variation, compromise, exchange, renewal or
      release of, or refusal or neglect to perfect, take up or enforce, any
      rights against, or security over assets of, any person;

	 	 
	9.2.4 	
      any non-presentation or non-observance of any formality
      or other requirement in respect of any instrument or any failure to
      realise the full value of any Security;

8 

	9.2.5 	
      any incapacity or lack of power, authority or legal
      personality of or dissolution or change in the members or status of any
      person;

	 	 
	9.2.6 	
      any amendment of a Finance Document or any other document
      or security;

	 	 
	9.2.7 	
      any unenforceability, illegality or invalidity of any
      obligation of any person under any Finance Document or any other document
      or security; or

	 	 
	9.2.8 	
      any insolvency, business rescue or similar
      proceedings.

	9.3 	
      Immediate recourse

	9.3.1 	
      Each Subordinated Creditor waives any right it may have
      of first requiring any Senior Creditor (or any trustee or other agent on
      its behalf) to proceed against or enforce any other rights or security or
      claim payment from any person before enforcing its rights under this
      Agreement.

	 	 
	9.3.2 	
      This waiver applies irrespective of any provision of a
      Finance Document to the contrary.

	9.4 	
      Non-competition

	 	 
		
      Except as permitted under Clause 4.4.2 (Filing of
      claims), until the Final Discharge Date or until the Facility Agent
      otherwise directs, no Subordinated Creditor will under any
      circumstance:

	9.4.1 	
      be entitled to any cession of action or otherwise be
      subrogated to any rights, security or moneys held, received or receivable
      by any Senior Creditor (or any trustee or agent on its behalf) or be
      entitled to any right of contribution or indemnity in respect of any
      payment made or moneys received on account of that Subordinated Creditor's
      liability under this Agreement;

	 	 
	9.4.2 	
      claim, rank, prove or vote as a creditor of any person or
      estate in competition with any Senior Creditor (or any trustee or other
      agent on its behalf); or

	 	 
	9.4.3 	
      receive, claim or have the benefit of any payment,
      distribution or security from or on account of any person in respect of a
      Subordinated Debt.

	10. 	
      REPRESENTATIONS AND
WARRANTIES

	10.1 	
      General

	 	 
		
      Each Subordinated Creditor makes the representations and
      warranties set out in this Clause 10, on its own behalf only, to each
      Senior Creditor. References in this Clause to "it" or "its"
      include, unless the context otherwise requires, is a reference to each
      Subordinated Creditor. The Senior Creditors enter into the Finance
      Documents on the strength of and relying on the representations and
      warranties set out in this Clause 10, each of which is a separate
      representation and warranty, given without prejudice to any other
      representation or warranty and is deemed to be a material representation
      or warranty (as applicable) inducing the Senior Creditors to enter into
      the Finance Documents.

	10.2 	
      Status

	10.2.1 	
      It is a limited liability company, duly incorporated and
      validly existing under the laws of its jurisdiction of
    incorporation.

9 

	10.2.2 	
      It has the power to own its assets and conduct its
      business as it is being conducted.

	10.3 	
      Powers and authority

	 	 
		
      It has the power to enter into and perform, and has taken
      all necessary action to authorise the entry into and performance of, this
      Agreement and the transactions contemplated by this Agreement.

	 	 
	10.4 	
      Legal validity

	 	 
		
      This Agreement constitutes its legally valid, binding and
      enforceable obligations (save to the extent that such enforcement is
      limited by laws of insolvency or other limitations on the rights of
      creditors generally).

	 	 
	10.5 	
      Non-conflict

	 	 
		
      The entry into and performance by it of, and the
      transactions contemplated by, this Agreement do not and will not conflict
      with:

	10.5.1 	
      any law or regulation applicable to it; or

	 	 
	10.5.2 	
      its constitutional documents; or

	 	 
	10.5.3 	
      any document which is binding upon it or any of its
      assets.

	10.6 	
      Authorisations

	 	 
		
      All authorisations required by it in connection with the
      entry into, performance, validity and enforceability of, and the
      transactions contemplated by, this Agreement have been obtained or
      effected (as appropriate) and are in full force and
  effect.

	10.7 	
      Subordinated Debt

	10.7.1 	
      Each Subordinated Creditor is the sole legal and
      beneficial owner of the Subordinated Debt owed to it and of the benefits
      of any Subordinated Documents to which it is party as a creditor, free
      from any Security, option or subordination in favour of any person other
      than the Senior Creditors.

	 	 
	10.7.2 	
      The Subordinated Debt is not subject to any set-off,
      counterclaim or other defence.

	10.8 	
      Immunity

	10.8.1 	
      The entry into by it of this Agreement, and the exercise
      by it of its rights and performance of its obligations under this
      Agreement will constitute private and commercial acts performed for
      private and commercial purposes.

	 	 
	10.8.2 	
      As at the Signature Date, it will not be entitled to
      claim immunity from suit, execution, attachment or other legal process in
      any proceedings taken in its jurisdiction of incorporation in relation to
      this Agreement.

	10.9 	
      Jurisdiction/governing
law

	10.9.1 	
      Its:

10 

	 	(a) 	
      irrevocable submission under this Agreement to the
      non-exclusive jurisdiction of the High Court of South Africa (Gauteng
      Local Division, Johannesburg) (or any successor division);

	 	 	 
	 	(b) 	
      agreement that this Agreement is governed by the laws of
      South Africa; and

	 	 	 
	 	(c) 	
      agreement not to claim any immunity to which it or its
      assets may be entitled,

are legal, valid and binding under the
laws of its jurisdiction of incorporation. 

	10.9.2 	
      Any judgment obtained in South Africa in relation to this
      Agreement will be recognised and enforced in its jurisdiction of
      incorporation

	10.10 	
      Common Terms Agreement

	 	 
		
      It is familiar with the relevant terms, conditions, words
      and expressions in the Common Terms Agreement and agrees to be bound by
      the terms of the Common Terms Agreement that are incorporated into this
      Agreement.

	 	 
	10.11 	
      Times for making
representations

	10.11.1 	
      The representations and warranties set out in this Clause
      10 are made by each Subordinated Creditor on the Signature Date.

	 	 
	10.11.2 	
      Unless a representation and warranty is expressed to be
      given at a specific date (in which case it shall not be deemed to be
      repeated on another date), each representation and warranty is deemed to
      be repeated by:

	 	(a) 	
      each Subordinated Creditor on each day until the Final
      Discharge Date; and

	 	 	 
	 	(b) 	
      each Additional Subordinated Creditor, on the day on
      which it becomes (or it is proposed that it becomes) an Additional
      Subordinated Creditor.

	10.11.3 	
      When a representation and warranty is repeated, it is
      made with reference to the circumstances existing at the time of
      repetition.

	11. 	
      INFORMATION BY SUBORDINATED
  CREDITORS

	11.1 	
      Defaults

	 	 
		
      Each Subordinated Creditor must notify the Facility Agent
      of the occurrence of any event of default or potential event of default
      under the Subordinated Documents to which it is party, promptly upon
      becoming aware of it.

	 	 
	11.2 	
      Amount of Subordinated Debt

	 	 
		
      Each Subordinated Creditor must, on request by the
      Facility Agent, notify it of details of the amount of the Subordinated
      Debt.

	12. 	
      PRESERVATION OF SUBORDINATED DEBT

	 	 
		
      Notwithstanding any term of this Agreement postponing,
      subordinating or preventing the payment of any Subordinated Debt, that
      Subordinated Debt will, solely as between the Parent and the relevant
      Subordinated Creditor, remain owing or due and payable in accordance with
      the terms of the applicable Subordinated
Documents.

11 

	13. 	
      TREATMENT OF
DISTRIBUTIONS

	13.1 	
      Non-cash distributions

	 	 
		
      If any Senior Creditor receives from any Obligor or from
      any other source any distribution otherwise than in cash in respect of the
      Subordinated Debt from any Obligor or from any other source, the Senior
      Debt will not be deemed reduced by that distribution until and except to
      the extent that the realisation proceeds are applied towards the Senior
      Debt.

	 	 
	13.2 	
      Transfer of distributions

	 	 
		
      The Borrower, each Intergroup Debtor and each
      Subordinated Creditor must do anything which the Facility Agent may
      reasonably require as being necessary to transfer to the Facility Agent
      all payments and distributions which are to be made to or held for the
      benefit of the Senior Creditors, including endorsements and execution of
      formal transfers.

	14. 	
      RESPONSIBILITY OF THE FACILITY
  AGENT

	14.1 	
      Rights and responsibility of the Facility
    Agent

	 	 
		
      The Facility Agent will not be liable to any Subordinated
      Creditor for the manner of exercise of or for any non-exercise of its
      powers under this Agreement or another Finance Document, or any failure to
      collect or preserve the Subordinated Debt (except to the extent that a
      Subordinated Creditor incurs any loss, liability or damage as a direct
      result of the gross negligence or wilful misconduct of the Facility
      Agent).

	 	 
	14.2 	
      Indemnity

	 	 
		
      The Borrower, each Intergroup Debtor and each
      Subordinated Creditor must jointly and severally indemnify the Facility
      Agent and every attorney appointed by it in respect of any loss or
      liability incurred by it in connection with any of its rights, powers and
      discretions under this Agreement, unless that liability arises as a result
      of the Facility Agent's or it's attorney's gross negligence or wilful
      misconduct.

	 	 
	14.3 	
      Non-derogation

	 	 
		
      Nothing contained in this Agreement in any manner affects
      the rights or remedies of any Senior Creditor under the Finance
      Documents.

	15. 	
      CHANGES TO THE PARTIES

	15.1 	
      The Borrower, the Intergroup Debtors and the
      Subordinated Creditors

	15.1.1 	
      The Borrower, the Intergroup Debtors or the Subordinated
      Creditors may not cede and/or delegate or otherwise transfer any of its
      rights or obligations under this Agreement, without the express prior
      written consent of the Facility Agent.

	 	 
	15.1.2 	
      Without prejudice to the provisions of another Finance
      Document, no Subordinated Creditor may cede and/or delegate or otherwise
      transfer any of its rights or obligations under any Subordinated Document
      or with respect to any Subordinated Debt, unless the person to which those
      rights or obligations are transferred is or becomes party to this
      Agreement as a Subordinated Creditor.

	 	 
	15.1.3 	
      In the event that any person other than Holdco becomes a
      shareholder of the Borrower, the Borrower and each Intergroup Debtor or
      Subordinated Creditor that is aware thereof shall, promptly upon becoming
      so aware, be obliged to:

12 

	 	(a) 	
      notify the Facility Agent; and

	 	 	 
	 	(b) 	
      procure that such person who becomes a shareholder of the
      Borrower accedes to this Agreement as an Additional Subordinated Creditor
      in accordance with Clause 15.3(Additional Subordinated Creditor) without
      delay and in any case before or simultaneously with such person becoming a
      shareholder of the Borrower.

	15.2 	
      Additional Intergroup Debtor

	 	 
		
      A person shall become an Additional Intergroup Debtor
      if:

	15.2.1 	
      the Additional Intergroup Debtor and the Borrower deliver
      to the Facility Agent a duly completed and executed Accession Letter;
      and

	 	 
	15.2.2 	
      the Facility Agent has received all of the documents and
      evidence listed in Schedule 4 (Conditions Precedent) in relation to that
      Additional Intergroup Debtor, each in form and substance satisfactory to
      the Facility Agent.

	15.3 	
      Additional Subordinated Creditor

	 	 
		
      A person shall become an Additional Subordinated Creditor
      if:

	15.3.1 	
      the Additional Subordinated Creditor and the Borrower
      deliver to the Facility Agent a duly completed and executed Accession
      Letter; and

	 	 
	15.3.2 	
      the Facility Agent has received all of the documents and
      evidence listed in Schedule 4 (Conditions Precedent) in relation to that
      Additional Subordinated Creditor, each in form and substance satisfactory
      to the Facility Agent.

	15.4 	
      The Senior Creditors

	15.4.1 	
      A Senior Creditor may cede or otherwise transfer all or
      any of its rights under this Agreement, in accordance with the Common
      Terms Agreement.

	 	 
	15.4.2 	
      The Borrower, each Intergroup Debtor and each
      Subordinated Creditor irrevocably consent to any splitting of claims which
      may arise as a result of a Senior Creditor exercising its rights under
      this Clause 15.4.

	 	 
	15.4.3 	
      References to the Facility Agent in this Agreement
      include any successor Facility Agent appointed under the Finance
      Documents.

	16. 	
      POWER OF ATTORNEY

	 	 
		
      The Borrower, each Intergroup Debtor and each
      Subordinated Creditor irrevocably and severally appoint the Facility Agent
      and any of its delegates or sub-delegates to be its attorney to take any
      action which the Borrower, an Intergroup Debtor or a Subordinated Creditor
      is obliged to take under this Agreement but has failed to take. The
      Borrower, each Intergroup Debtor and each Subordinated Creditor ratify and
      confirm whatever any attorney does or purports to do under its appointment
      under this Clause.

	 	 
	17. 	
      SET-OFF

	 	 
		
      A Senior Creditor may set off any matured obligation owed
      to it by a Subordinated Creditor under this Agreement (to the extent
      beneficially owned by that Senior Creditor) against any matured obligation
      owed by that Senior Creditor to that Subordinated Creditor, regardless of
      the place of payment, booking branch or currency of either obligation. If
      the obligations are in different currencies, the Senior Creditor may
      convert either obligation at a market rate of exchange in its usual course of business for the purpose of the
set-off. 

13 

	18. 	
      DEFAULT INTEREST

	18.1 	
      If a Subordinated Creditor fails to pay any amount
      payable by it under this Agreement to a Senior Creditor, it must, on
      demand by the Facility Agent, pay interest on the overdue amount from the
      due date up to the date of actual payment at a rate equal to the Prime
      Rate plus 2.00 per cent.

	 	 
	18.2 	
      For the purposes of this Clause, Prime Rate means,
      at any relevant time, the publicly quoted prime overdraft rate of interest
      of FirstRand Bank Limited (acting through its First National Bank
      division) at that time, being the nominal rate of interest per annum
      (compounded monthly in arrear) at which that bank lends money on unsecured
      overdraft to corporate borrowers (a certificate from any manager of that
      bank, whose appointment or authority need not be proved, as to the prime
      rate at any time and the usual way in which it is calculated and
      compounded at such time will be prima facie proof of that
    rate).

	 	 
	18.3 	
      Interest (if unpaid) on an overdue amount will be
      compounded at the end of each calendar month, but will remain immediately
      due and payable.

	19. 	
      CALCULATIONS AND
CERTIFICATES

	19.1 	
      Accounts

	 	 
		
      In any litigation or arbitration proceedings arising out
      of or in connection with this Agreement, the entries made in the accounts
      maintained by a Senior Creditor, in the absence of manifest error, are
      prima facie proof of the matters to which they relate.

	 	 
	19.2 	
      Certificates and determinations

	 	 
		
      A certification or determination by the Facility Agent of
      a rate or amount or a due date under this Agreement, signed by any
      officer, manager or employee of the Facility Agent (the appointment of
      which officer, manager or employee need not be proved), will be, in the
      absence of manifest error, prima facie proof of the matters to
      which it relates.

	 	 
	19.3 	
      Accrual and day count convention

	 	 
		
      Any interest accruing under this Agreement accrues from
      day to day and is calculated on the basis of the actual number of days
      elapsed and a year of 365 days or otherwise, depending on what the
      Facility Agent reasonably determines is market
practice.

	20. 	
      NOTICES AND DOMICILIA

	20.1 	
      In writing

	20.1.1 	
      Any communication in connection with this Agreement must
      be in writing.

	 	 
	20.1.2 	
      Communications in connection with this Agreement, other
      than a notice of intended cession, delegation or transfer or a notice of
      Default, may also be given by any form of electronic communication
      previously approved in writing by the Facility Agent.

	 	 
	20.1.3 	
      Any consent, waiver or agreement required under this
      Agreement must be given in writing.

14 

	20.2 	
      Language

	 	 
		
      Any notice given in connection with this Agreement must
      be in English.

	 	 
	20.3 	
      Addresses

	 	 
		
      The address and fax number (and the department or
      officer, if any, for whose attention the communication is to be made) of
      each Party for any communication or document to be made or delivered under
      or in connection with this Agreement is:

	20.3.1 	
      in the case of the Subordinated Creditors, the address
      and other details specified opposite its name in Schedule 1 to this
      Agreement;

	 	 
	20.3.2 	
      in the case of the Borrower:

	 	Address: 	Sixth Floor 
	 	 	
      President Place  

	 	  	Corner Jan Smuts Avenue and Bolton Road 
	 		
      Rosebank, 2196  

	 	  	  
	 	Email address: 	hermank@net1.com 
	 	  	  
	 	For the attention of: 	Herman Kotze 

	20.3.3 	
      in the case of the Facility Agent (in its capacity as
      such):

	 	Address: 	1 Merchant Place, 14th Floor 
	 	  	
      Cnr Fredman Drive and Rivonia Road 

	 	  	
      Sandton, 2196 

	 	  	
      

	 	Email address: 	
      Ravana.chetty@rmb.co.za 

	 		
      Sureka.ally@rmb.co.za    

	 		
      Ziyaad.manie@rmb.co.za    

	 	  	
      

	 	Fax number: 	
      +27 (11) 282 4043 

	 	  	
      

	 	For the attention of: 	
      Head of Transaction Management - Investment Banking
      Division 

	20.3.4 	
      in the case of each Original Senior Creditor (in its
      capacity as such), the address and other details specified opposite its
      name in Schedule 1 (The Original Parties) of the Common Terms
      Agreement;

	 	 
	20.3.5 	
      in the case of any other Senior Creditor, those details
      notified in writing to the Facility Agent on or before the date on which
      it becomes a party to the Common Terms Agreement,

or any substitute address or fax
number or department or officer as the Party may notify to the Facility Agent
(or the Facility Agent may notify to the other Parties, if a change is made by
the Facility Agent) by not less than 5 Business Days' notice. 

	20.4 	
      Effectiveness

	20.4.1 	
      Except as provided below, any communication in connection
      with this Agreement will be deemed to have been duly
  given:

	 	(a) 	
      if delivered in person, at the time of
  delivery;

15 

	 	(b) 	
      if posted, 14 days after being deposited in the post,
      postage prepaid, in a correctly addressed envelope;

	 	 	 
	 	(c) 	
      if by fax, e-mail or any other electronic communication,
      and provided it is received in legible form, on the day of its
      transmission, except that any such transmission after 16h30 shall be
      deemed to have been received on the following
day.

	20.4.2 	
      A communication given under 20.4.1 above but received on
      a day which is not a Business Day or after business hours in the place of
      receipt will be deemed to be given on the next Business Day.

	 	 
	20.4.3 	
      Where the Facility Agent nominates a particular
      department or officer to receive a communication, a communication will not
      be effective if it fails to specify that department or officer.

	 	 
	20.4.4 	
      A communication to the Facility Agent will only be
      effective on actual receipt by it.

	 	 
	20.4.5 	
      This Clause will not operate so as to invalidate the
      giving or receipt of any notice which is actually received by the
      addressee other than by a method referred to
above.

	21. 	
      MISCELLANEOUS MATTERS

	21.1 	
      Entire contract

	 	 
		
      This Agreement read together with the other Finance
      Documents contain all the express provisions agreed on by the Parties with
      regard to the subject matter of the Finance Documents and each Party
      waives the right to rely on any alleged express provision not contained in
      the Finance Documents.

	 	 
	21.2 	
      No representations

	 	 
		
      A Party may not rely on any representation which
      allegedly induced that Party to enter into this Agreement or another
      Finance Document, unless the representation is recorded in this Agreement
      or another Finance Document.

	 	 
	21.3 	
      Rights and remedies

	 	 
		
      The rights and remedies of a Senior Creditor under this
      Agreement:

	21.3.1 	
      are cumulative and not exclusive of its rights under the
      general law;

	 	 
	21.3.2 	
      may be exercised as often as that Senior Creditor
      requires;

	 	 
	21.3.3 	
      may be waived only in writing and
  specifically.

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

	21.4 	
      Indulgences

	21.4.1 	
      If a Senior Creditor allows any indulgence to the
      Borrower, an Intergroup Debtor or a Subordinated Creditor under this
      Agreement, that indulgence will not constitute a waiver by that Senior
      Creditor of any rights under this Agreement or prevent or adversely affect
      the exercise by that Senior Creditor of any existing or future
    right.

16 

	21.4.2 	
      A Senior Creditor will not be estopped (i.e. prevented)
      from exercising its rights arising out of a breach by the Borrower, an
      Intergroup Debtor or a Subordinated Creditor of any of its obligations
      under this Agreement, as a result of that Senior Creditor having elected
      or agreed on one or more previous occasions not to exercise its rights
      arising out of any similar preceding breach or
breaches.

	21.5 	
      Amendments and
cancellation

	21.5.1 	
      No contract varying, adding to, deleting from or
      cancelling this Agreement will be effective unless reduced to writing and
      signed by or on behalf of the Parties.

	 	 
	21.5.2 	
      The expiry or termination of this Agreement will not
      prejudice the rights of a Senior Creditor in respect of any antecedent
      breach by the Borrower, an Intergroup Debtor or a Subordinated Creditor
      of, or non-performance under, this Agreement.

	21.6 	
      Severability

	 	 
		
      Each term of this Agreement, whether forming an entire
      clause or only part of a clause, is divisible and severable from all the
      other terms (regardless of the manner in which they may be linked together
      or grouped grammatically). If a term of this Agreement is or becomes
      illegal, invalid or unenforceable in any respect in any jurisdiction, that
      will not affect or impair in any manner the legality, validity or
      enforceability in that jurisdiction of any other term of this Agreement,
      or the legality, validity or enforceability in other jurisdictions of that
      and all the other terms of this Agreement.

	 	 
	21.7 	
      Renunciation of benefits

	 	 
		
      Each Subordinated Creditor renounces, to the extent
      permitted under applicable law, the benefits of each of the legal
      exceptions of excussion, division, revision of accounts, no value
      received, errore calculi, non causa debiti, non numeratae
      pecuniae and cession of actions, and declares that it understands the
      meaning of each such legal exception and the effect of such
      renunciation.

	 	 
	21.8 	
      Governing law

	 	 
		
      This Agreement and any non-contractual obligations
      arising out of or in connection with it are governed by South African
      law.

	 	 
	21.9 	
      Jurisdiction

	21.9.1 	
      The Parties consent to the non-exclusive jurisdiction of
      the High Court of South Africa (Gauteng Local Division, Johannesburg) (or
      its successor division), to settle any dispute in connection with this
      Agreement.

	 	 
	21.9.2 	
      The Parties agree that the High Court of South Africa
      (Gauteng Local Division, Johannesburg) is the most appropriate and
      convenient court to settle any such dispute in connection with this
      Agreement. The Parties agree not to argue to the contrary and waive
      objection to this court on the grounds of inconvenient forum or otherwise
      in relation to proceedings in connection with this Agreement.

	 	 
	21.9.3 	
      To the extent allowed by law, a Senior Creditor may
      take:

	 	(a) 	
      proceedings in any other court; and

	 	 	 
	 	(b) 	
      concurrent proceedings in any number of
    jurisdictions.

17 

	21.10 	
      Waiver of immunity

	 	 
		
      Each Subordinated Creditor irrevocably and
      unconditionally:

	21.10.1 	
      agrees not to claim any immunity from proceedings brought
      by a Senior Creditor against it in relation to a Finance Document and to
      ensure that no such claim is made on its behalf;

	 	 
	21.10.2 	
      consents generally to the giving of any relief or the
      issue of any process in connection with those proceedings; and

	 	 
	21.10.3 	
      waives all rights of immunity in respect of it or its
      assets.

	21.11 	
      Further assurances

	 	 
		
      Each Party must perform, or procure the performance, of
      all further things, and execute and deliver (or procure the execution and
      delivery) of all further documents, as may be required by any applicable
      law or as may be necessary or desirable to implement or give effect to
      this Agreement and the transactions contemplated herein.

	 	 
	21.12 	
      Independent advice

	 	 
		
      Each Party acknowledges that it has been free to secure
      independent legal and other advice as to the nature and effect of this
      Agreement and that it has either taken such independent legal and other
      advice or dispensed with the necessity of doing so. Further, each Party
      acknowledges that all of the provisions of this Agreement and the
      restrictions herein contained have been negotiated as between the Parties
      and are part of the overall intention of the Parties in connection with
      this Agreement.

	 	 
	21.13 	
      Counterparts

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

18 

SCHEDULE 1 

THE ORIGINAL SUBORDINATED
CREDITORS 

		
      Original Subordinated Creditor

      [Column 2] 
	Domicile /
      

      Jurisdiction of 
incorporation 
      [Column 3] 
	Registration
      

      number 
(or equivalent)
      [Column 4] 
	Address for purposes
      of Clause 20 (Notices and 

      Domicilia)
      [Column 5] 

	1. 	Net1 UEPS Technologies, Inc. 	State of Florida, 
United States 	- 	Sixth Floor 
President Place
      
Corner Jan Smuts Avenue and Bolton Road 
Rosebank, 2196
      

Email:       
          hermank@net1.com
    

Attention:    Herman Kotze
	  	  	  	  
	2. 	Net1 Applied Technologies South Africa
      Proprietary Limited 	South Africa 	2002/031446/07 
	3. 	Cash Paymaster Services Proprietary Limited 	South Africa 	1971/007195/07 
	4. 	EasyPay Proprietary Limited 	South Africa 	1983/008597/07 
	5. 	Manje Mobile Electronic Payment Services
      Proprietary Limited 	South Africa 	2008/004377/07 
	6. 	Moneyline Financial Services Proprietary
      Limited 	South Africa 	1998/020799/07 
	7. 	Net1 FIHRST Holdings Proprietary Limited 	South Africa 	2009/022023/07 
	8. 	Net1 Finance Holdings Proprietary Limited 	South Africa 	1998/020801/07 
	9. 	Net1 Mobile Solutions Proprietary Limited 	South Africa 	2006/009851/07 
	10. 	Net1 Universal Electronic Technological
      Solutions Proprietary Limited 	South Africa 	2009/001034/07 
	11. 	Prism Holdings Proprietary Limited 	South Africa 	1998/018949/07 
	12. 	Prism Payment Technologies Proprietary Limited
    	South Africa 	1990/005062/07 
	13. 	RMT Systems Proprietary Limited 	South Africa 	2001/028826/07 

19 

SCHEDULE 2 

THE ORIGINAL INTERGROUP
DEBTORS 

		
      Original Intergroup Debtors 

      [Column 2] 
	Domicile /
      

      Jurisdiction of 
incorporation
      [Column 3] 
	Registration
      

      number 
(or equivalent)
      [Column 4] 
	Address for purposes
      of Clause 20 (Notices and 

      Domicilia)
      [Column 5] 

	1. 	Net1 UEPS Technologies, Inc. 	State of Florida, 
United States 	- 	Sixth Floor 
President Place
      
Corner Jan Smuts Avenue and Bolton Road 
Rosebank, 2196
      

Email:           
      hermank@net1.com
      

Attention:    Herman Kotze
      

	2. 	Net1 Applied Technologies South Africa
      Proprietary Limited 	South Africa 	2002/031446/07 
	3. 	Cash Paymaster Services Proprietary Limited 	South Africa 	1971/007195/07 
	4. 	EasyPay Proprietary Limited 	South Africa 	1983/008597/07 
	5. 	Manje Mobile Electronic Payment Services
      Proprietary Limited 	South Africa 	2008/004377/07 
	6. 	Moneyline Financial Services Proprietary
      Limited 	South Africa 	1998/020799/07 
	7. 	Net1 FIHRST Holdings Proprietary Limited 	South Africa 	2009/022023/07 
	8. 	Net1 Finance Holdings Proprietary Limited 	South Africa 	1998/020801/07 
	9. 	Net1 Mobile Solutions Proprietary Limited 	South Africa 	2006/009851/07 
	10. 	Net1 Universal Electronic Technological
      Solutions Proprietary Limited 	South Africa 	2009/001034/07 
	11. 	Prism Holdings Proprietary Limited 	South Africa 	1998/018949/07 
	12. 	Prism Payment Technologies Proprietary Limited
    	South Africa 	1990/005062/07 
	13. 	RMT Systems Proprietary Limited 	South Africa 	2001/028826/07 

20 

SCHEDULE 3 

THE ORIGINAL SENIOR CREDITORS 

Part I : Original Senior Lender 

		Name
      of Original Senior Lender 	Jurisdiction of 
Incorporation 	Registration number 
(or equivalent, if
      any) 
	1. 	FirstRand Bank Limited (acting
      through its Rand Merchant Bank Division) 	South Africa 	1929/001225/06

Part II : Other Finance Parties 

		Name
      of Other Finance Parties 	Jurisdiction of 
Incorporation 	Registration number 
(or equivalent, if
      any) 
	1. 	FirstRand Bank Limited (acting
      through its Rand Merchant Bank division) (as Facility Agent) 	South Africa 	1929/001225/06

21 

SCHEDULE 4 

CONDITIONS PRECEDENT 

	1. 	
      An Accession Letter, duly executed by the Additional
      Intergroup Debtor or the Additional Subordinated Creditor and the
      Borrower.

	 	 
	2. 	
      A copy of the constitutional documents of the Additional
      Intergroup Debtor or the Additional Subordinated Creditor.

	 	 
	3. 	
      A copy of a resolution of the board of directors of the
      Additional Intergroup Debtor or the Additional Subordinated
    Creditor:

	3.1 	
      approving the terms of, and the transactions contemplated
      by, the Accession Letter and the Agreement and resolving that it execute
      the Accession Letter;

	 	 
	3.2 	
      authorising a specified person or persons to execute the
      Accession Letter on its behalf; and

	 	 
	3.3 	
      authorising a specified person or persons, on its behalf,
      to sign and/or despatch all other documents and notices to be signed
      and/or despatched by it under or in connection with the Finance
      Documents.

	4. 	
      To the extent required with reference to the
      constitutional documents of an Additional Intergroup Debtor or an
      Additional Subordinated Creditor, a copy of a resolution duly passed by
      the holders of the issued shares of that Additional Intergroup Debtor or
      that Additional Subordinated Creditor, approving the terms of, and the
      transactions contemplated by, the Finance Documents to which that
      Additional Intergroup Debtor or that Additional Subordinated Creditor is a
      party.

	 	 
	5. 	
      A specimen of the signature of each person authorised by
      the resolution referred to in paragraph 3 above.

	 	 
	6. 	
      A certificate of an authorised signatory of the
      Additional Intergroup Debtor or the Additional Subordinated Creditor
      certifying that each copy document listed in this Schedule 4 is correct,
      complete and in full force and effect as at a date no earlier than the
      date of the Accession Letter.

	 	 
	7. 	
      A legal opinion of [•], legal advisers to the
      Finance Parties and the Facility Agent in South Africa, addressed to the
      Facility Agent for and on behalf of the Finance Parties, substantially in
      the form distributed to the Original Senior Lenders prior to signing the
      Accession Deed in respect of the legality, validity and enforceability of
      the Accession Deed.

	 	 
	8. 	
      A legal opinion of [•], legal advisers to the
      Borrower in South Africa addressed to the Facility Agent for and on behalf
      of the Finance Parties, substantially in the form distributed to the
      Original Senior Lender prior to signing the Accession Deed, in respect of
      the capacity, powers and authority of the Additional Intergroup Debtor or
      the Additional Subordinated Creditor incorporated in South Africa which
      are party to the Accession Deed, to enter into and perform their
      obligations under the Accession Deed and the other Finance Documents and
      the due execution of those documents.

	 	 
	9. 	
      In relation to any Additional Intergroup Debtor or any
      Additional Subordinated Creditor incorporated in a jurisdiction other than
      South Africa, a legal opinion from legal counsel in that jurisdiction
      acceptable to the Facility Agent, addressed to the Facility Agent for and
      on behalf of the Finance Parties, substantially in the form distributed
to the Original Senior Lender prior to signing this Agreement, in respect of the
capacity, powers and authority of the Additional Intergroup Debtor or the
Additional Subordinated Creditor incorporated in a jurisdiction other than South
Africa which are party to the Accession Deed, to enter into and perform their
obligations under the Accession Deed and other Finance Documents and the due
execution of those documents. 

22 

	10. 	
      A copy of any other authorisation or other document,
      opinion or assurance which the Facility Agent considers to be necessary or
      desirable in connection with the entry into and performance of the
      transactions contemplated by the Accession Letter or for the validity and
      enforceability of any Finance Document.

23 

SCHEDULE 5 

FORM OF ACCESSION LETTER 

	To: 	[Facility Agent], as Facility Agent
  
	  	[•] 
	  	[•] 
	  	  
	From: 	NET1 APPLIED TECHNOLOGIES SOUTH AFRICA
      PROPRIETARY LIMITED 
	  	  
	And: 	[ADDITIONAL INTERGROUP DEBTOR/ADDITIONAL
      SUBORDINATED CREDITOR] 

[•], 201[•] 

Dear Sirs, 

NET1 APPLIED TECHNOLOGIES SOUTH AFRICA PROPRIETARY LIMITED

Subordination Agreement, dated [•], 2016 
(the
Agreement)

	1. 	
      We refer to the Agreement.

	 	 
	2. 	
      This is an Accession Letter. Terms defined in the
      Agreement have the same meaning in this Accession Letter unless given a
      different meaning in this Accession Letter.

	 	 
	3. 	
      [Intergroup Debtor/Subordinated Creditor] agrees,
      with effect from the date of this Accession Letter, to become a[n]
      [Intergroup Debtor/Subordinated Creditor] under the Agreement and to be
      bound by the terms of the Agreement as a[n] [Intergroup
      Debtor/Subordinated Creditor] pursuant to Clause 15.2 (Changes to the
      Parties) of the Agreement.

	 	 
	4. 	
      [Intergroup Debtor/Subordinated Creditor] is a
      company duly incorporated under the laws of [name of relevant
      jurisdiction].

	 	 
	5. 	
      [Intergroup Debtor/Subordinated Creditor's]
      administrative details are as follows:

	 	Address: 	
      [•]; 

	 	Fax number: 	
      [•]; 

	 	For the attention of: 	
      [•]. 

	6. 	
      This Accession Letter is a Finance Document.

	 	 
	7. 	
      This Accession Letter may be executed in any number of
      counterparts. This has the same effect as if the signatures on the
      counterparts were on a single copy of this Accession Letter.

	 	 
	8. 	
      This Accession Letter and any non-contractual obligations
      arising out of or in connection with it are governed by South African
      law.

24 

  

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	Net1 Applied Technologies South Africa
      Proprietary Limited 		[Additional Intergroup Debtor/Additional
      Subordinated Creditor] 

	Name: 	 	 	Name: 	 
	  	 	 	  	 
	Office: 	 	 	Office: 	 
		(who warrants his authority)  	 		(who warrants his
  authority)  

25 

Accepted by the Facility Agent: 

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	[Facility Agent] 	 	[Facility Agent]

	Name: 	 	 	Name: 	 
	 	 	 	 	 
	Office: 	 	 	Office: 	 
	 	 	 	 	 
	Date: 	 	 	Date: 	 
		(who warrants his authority) 	 		(who warrants his authority)

26 

SIGNATURE PAGE 

BORROWER 

 

	For and on behalf of:
    
	Net1 Applied Technologies South Africa
      Proprietary Limited 

	Name: 	/s/
      Herman G. Kotzé 	 
	  	  	 
	Office: 	Chief
      Financial Officer 	 
	  	(who warrants his authority) 	 

SIGNATURE PAGE 

HOLDCO 

 

	For and on behalf of:
    
	Net1 UEPS Technologies, Inc.

	Name: 	/s/
      Herman G. Kotzé 	 
	  	  	 
	Office: 	Chief
      Financial Officer 	 
	  	(who warrants his authority) 	 

SIGNATURE PAGE 

SUBORDINATED CREDITORS 

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	Net1 UEPS Technologies, Inc. 	 	Net1 Applied Technologies South Africa
      Proprietary Limited 

	Name: 	/s/
      Herman G. Kotzé 	 	Name: 	/s/
      Herman G. Kotzé 
	  	  	 	  	  
	Office: 	Chief
      Financial Officer 	 	Office: 	Chief
      Financial Officer 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	Cash Paymaster Services Proprietary Limited
    		EasyPay Proprietary Limited
  

	Name: 	/s/
      Herman G. Kotzé 	 	Name: 	/s/
      Herman G. Kotzé 
	  	  	 	  	  
	Office: 	Chief
      Financial Officer 	 	Office: 	Chief
      Financial Officer 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	Manje Mobile Electronic Payment Services
      Proprietary Limited 	 	Moneyline Financial Services Proprietary
      Limited 

	Name: 	/s/
      Herman G. Kotzé 	 	Name: 	/s/
      Herman G. Kotzé 
	  	  	 	  	  
	Office: 	Chief
      Financial Officer 	 	Office: 	Chief
      Financial Officer 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

SIGNATURE PAGE 

SUBORDINATED CREDITORS 

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	Net1 FIHRST Holdings Proprietary Limited 		Net1 Finance Holdings Proprietary
      Limited 

	Name: 	/s/
      Herman G. Kotzé 	 	Name: 	/s/
      Herman G. Kotzé 
	  	  	 	  	  
	Office: 	Chief
      Financial Officer 	 	Office: 	Chief
      Financial Officer 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

 

	 	 	 
	For and on behalf of: 	 	For and on behalf of: 
	Net1 Mobile Solutions Proprietary 	 	Net1 Universal Electronic Technological    
	Limited 	 	Solutions Proprietary Limited  

	Name: 	/s/
      Herman G. Kotzé 	 	Name: 	/s/ N.
      Pillay 
	  	  	 	  	  
	Office: 	Chief
      Financial Officer 	 	Office: 	Director 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	Prism Holdings Proprietary Limited 	 	Prism Payment Technologies Proprietary
      Limited 

	Name: 	/s/
      Herman G. Kotzé 	 	Name: 	/s/
      Herman G. Kotzé 
	  	  	 	  	  
	
    Office: 
	Chief
      Financial Officer 	 	Office: 	Chief
      Financial Officer 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

SIGNATURE PAGE 

SUBORDINATED CREDITORS 

 

	For and on behalf of:
    
	RMT Systems Proprietary Limited

	Name: 	/s/ Herman G. Kotzé 	 
	  	  	 
	Office: 	Chief Financial Officer 	 
	  	(who warrants his authority)
	 

SIGNATURE PAGE 

INTERGROUP DEBTORS 

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	Net1 UEPS Technologies, Inc. 	 	Net1 Applied Technologies South Africa
      Proprietary Limited 

	Name: 	/s/
      Herman G. Kotzé 	 	Name: 	/s/
      Herman G. Kotzé 
	  	  	 	  	  
	Office: 	Chief
      Financial Officer 	 	Office: 	Chief
      Financial Officer 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	Cash Paymaster Services Proprietary Limited
    		EasyPay Proprietary Limited
  

	Name: 	/s/
      Herman G. Kotzé 	 	Name: 	/s/
      Herman G. Kotzé 
	  	  	 	  	  
	Office: 	Chief
      Financial Officer 	 	Office: 	Chief
      Financial Officer 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	Manje Mobile Electronic Payment Services
      Proprietary Limited 		Moneyline Financial Services Proprietary
      Limited 

	Name: 	/s/
      Herman G. Kotzé 	 	Name: 	/s/
      Herman G. Kotzé 
	  	  	 	  	  
	Office: 	Chief
      Financial Officer 	 	Office: 	Chief
      Financial Officer 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

SIGNATURE PAGE 

INTERGROUP DEBTORS 

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	Net1 FIHRST Holdings Proprietary Limited 	 	Net1 Finance Holdings Proprietary
      Limited 

	Name: 	/s/
      Herman G. Kotzé 	 	Name: 	/s/
      Herman G. Kotzé 
	  	  	 	  	  
	Office: 	Chief
      Financial Officer 	 	Office: 	Chief
      Financial Officer 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	Net1 Mobile Solutions Proprietary Limited 	 	Net1 Universal Electronic Technological
      Solutions Proprietary Limited 

	Name: 	/s/
      Herman G. Kotzé 	 	Name: 	/s/ N.
      Pillay 
	  	  	 	  	  
	Office: 	Chief
      Financial Officer 	 	Office: 	Director 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	Prism Holdings Proprietary Limited 	 	Prism Payment Technologies Proprietary
      Limited 

	Name: 	/s/
      Herman G. Kotzé 	 	Name: 	/s/
      Herman G. Kotzé 
	  	  	 	  	  
	Office: 	Chief
      Financial Officer 	 	Office: 	Chief
      Financial Officer 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

SIGNATURE PAGE 

INTERGROUP DEBTORS 

 

	For and on behalf of:
    
	RMT Systems Proprietary Limited

	Name: 	/s/
      Herman G. Kotzé 	 
	  	  	 
	Office: 	Chief
      Financial Officer 	 
	  	(who warrants his authority) 	 

SIGNATURE PAGE 

THE ORIGINAL SENIOR LENDER 

	For and on behalf of:
    	 	For and
      on behalf of: 
	FirstRand Bank Limited (acting through its Rand
      Merchant Bank Division) 		FirstRand Bank Limited (acting through
      its Rand Merchant Bank Division) 

	Name: 	/s/
      Niel van Zyl 	 	Name: 	/s/
      Ziyaad Manie 
	  	  	 	  	  
	Office: 	Authorised 	 	Office: 	Authorised 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

SIGNATURE PAGE 

THE FACILITY AGENT 

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	FirstRand Bank Limited (acting through its Rand
      Merchant Bank division) 		FirstRand Bank Limited (acting through
      its Rand Merchant Bank division) 

	Name: 	/s/
      Niel van Zyl 	 	Name: 	/s/
      Ziyaad Manie 
	  	  	 	  	  
	Office: 	Authorised 	 	Office: 	Authorised 
	  	(who warrants his authority) 	 	  	(who warrants his authority)Net 1 UEPS Technologies, Inc.: Exhibit 10.42 - Filed by newsfilecorp.com

Exhibit 10.42

EXECUTION

SECURITY CESSION & PLEDGE 

 

DATED 20 OCTOBER, 2016 

 

given by 

 

NET1 APPLIED TECHNOLOGIES SOUTH AFRICA PROPRIETARY LIMITED

(as Cedent) 

 

in favour of 

 

FIRSTRAND BANK LIMITED 
(ACTING THROUGH ITS RAND
MERCHANT BANK DIVISION) 

 

and 

 

EACH OF THE OTHER SECURED CREDITORS 
(as Cessionaries)

 

in respect of certain Shares, Shareholder Claims and Related
Rights 

	 	 	

CONTENTS 

	Clause 	 	Page 
	 	 	 	 
	 	 	 	 
	1.
      	Interpretation
      	3
  
	2.
      	Pledge
      and Cession in Security 	5
  
	3.
      	Duration
      	5
  
	4.
      	Representations
      and Warranties by the Cedent 	6
  
	5.
      	Undertakings
      by the Cedent 	7
  
	6.
      	Delivery
      of Documents 	8
  
	7.
      	Corporate
      action in respect of the Shares 	9
  
	8.
      	Rights
      of the Cedent before Default 	9
  
	9.
      	Enforcement
      	10
  
	10.
      	Appropriation
      of Proceeds 	12
  
	11.
      	Payments
      	12
  
	12.
      	Power
      of Attorney 	12
  
	13.
      	Further
      Assurances 	12
  
	14.
      	Additional
      Rights 	13
  
	15.
      	Cedent
      bound notwithstanding certain circumstances 	13
  
	16.
      	Keeping,
      inspection and delivery of records 	13
  
	17.
      	Exemption
      from Liability 	14
  
	18.
      	Changes
      to the Parties 	14
  
	19.
      	Severability
      	14
  
	20.
      	Governing
      Law 	15
  
	21.
      	Jurisdiction
      	15
  
	22.
      	Miscellaneous
      Matters 	15
  
	 	 	 	 
	 	 	 	 
	Schedule
      1 	CSDP
      Confirmation 	17
  
	 	 	 
	 	 	 	 
	 	 	 	 
	Signature
      Page 	 	19
  

2

THIS AGREEMENT is dated 20 October, 2016 and is made
between: 

	(1) 	
      NET1 APPLIED TECHNOLOGIES SOUTH AFRICA PROPRIETARY
      LIMITED, registration number 2002/031446/07, as pledgor and cedent
      (the Cedent);

	 	 
	(2) 	
      FIRSTRAND BANK LIMITED (ACTING THROUGH ITS RAND
      MERCHANT BANK DIVISION) as Secured Creditor; and

	 	 
	(3) 	
      EACH OF THE OTHER SECURED CREDITORS (as defined in
      this Agreement below).

BACKGROUND: 

As security for the due and punctual performance of the Secured
Obligations, the Cedent has agreed to pledge its Shares and to cede in
securitatem debiti all its Secured Property to the Secured Creditors, on the
terms set out in this Agreement. 

	1. 	
      INTERPRETATION

	1.1 	
      Definitions

	 	 
		
      In this Agreement:

	1.1.1 	
      Blue Label Telecoms means Blue Label Telecoms
      Limited (registration number 2006/022679/06), a public company registered
      under the laws of South Africa;

	 	 
	1.1.2 	
      Common Terms Agreement means the common terms
      agreement, dated on or about 20 October, 2016, between, among others, the
      Cedent (as borrower) and FirstRand Bank Limited (acting through its Rand
      Merchant Bank division) (as arranger, lender and facility
agent);

	 	 
	1.1.3 	
      CSDP means a Central Securities Depository
      Participant, accepted as a participant under the Financial Markets
    Act;

	 	 
	1.1.4 	
      CSP means a custody services provider regulated in
      terms of the Financial Markets Act;

	 	 
	1.1.5 	
      Financial Markets Act means the Financial Markets
      Act, 2012, as amended or replaced from time to time;

	 	 
	1.1.6 	
      Party means a party to this Agreement;

	 	 
	1.1.7 	
      Related Rights means, in relation to any Shares
      and Shareholder Claims:

	 	(a) 	
      any monies, distributions and proceeds (including the
      proceeds of a disposal or other realisation) accrued or receivable in
      respect of all or part thereof;

	 	 	 
	 	(b) 	
      all rights and benefits in respect of any agreement for
      the disposal or other realisation thereof;

	 	 	 
	 	(c) 	
      all contracts, warranties, remedies, Security,
      indemnities and other undertakings in respect thereof; and

	 	 	 
	 	(d) 	
      any of the reversionary interests referred to in Clause
      4.7.4 (Secured Property);

	1.1.8 	
      Secured Creditor means each person who is or
      becomes a Finance Party under (and as defined in) the Common Terms
      Agreement, from time to time;

3 

	1.1.9 	
      Secured Obligations means all present and future
      obligations and indebtedness of whatsoever nature (whether actual or
      contingent and whether owed jointly or severally or in any other capacity
      whatsoever, including any liability to pay damages or pursuant to
      enrichment) which an Obligor may now or at any time hereafter owe or have
      towards any Secured Creditor under or in connection with the Finance
      Documents;

	 	 
	1.1.10 	
      Secured Property means,
  collectively:

	 	(a) 	
      the Shares;

	 	 	 
	 	(b) 	
      the Shareholder Claims; and

	 	 	 
	 	(c) 	
      the Related Rights,

and all of the Cedent's rights, title
and interests therein and thereto and claims against any person in respect
thereof, of whatsoever nature and howsoever arising (whether actual, prospective
or contingent, direct or indirect, arising under common law or statute, whether
a claim for the payment of money or the performance of another obligation and
whether or not those rights and interests were within the contemplation of the
Parties at the Signature Date) and, in each case, any property forming part
thereof; 

	1.1.11 	
      Shareholder Claims means any and all claims of any
      nature whatsoever and howsoever arising which the Cedent now has, or from
      time to time in future may have (other than claims in respect of trade
      credit in respect of goods and services supplied by the Cedent from time
      to time in the ordinary course of business), against, and any and all
      indebtedness of any nature whatsoever and howsoever arising which are now,
      or from time to time in future may be, owed to the Cedent by Blue Label
      Telecoms (whether in the form of shareholder loans, inter-company loans or
      any other form of credit provided by the Cedent to the Blue Label
      Telecoms), together with the benefit of any Security given to the Cedent
      in respect of those claims;

	 	 
	1.1.12 	
      Shares means all of the following shares and
      securities of which it is or becomes the legal or beneficial owner from
      time to time or which may be issued or transferred to it in
  future:

	 	(a) 	
      117,924,529 ordinary shares in the share capital of Blue
      Label Telecoms;

	 	 	 
	 	(b) 	
      any capitalisation shares or bonus shares issued in
      respect of the shares referred to in paragraph (a) above); and

	 	 	 
	 	(c) 	
      any securities issued in substitution or exchange for the
      securities in paragraphs (a), and (b) above,

		
      including, for the avoidance of doubt, all dividends
      (whether paid or unpaid), rights to dividends and voting rights in
      relation to those shares and securities; and

	 	 
	1.1.13 	
      Signature Date means the date on which, once this
      Agreement has been signed by all the Parties, it is signed by the last
      Party to do so.

	1.2 	
      Construction

	1.2.1 	
      Terms and expressions defined in the Common Terms
      Agreement, unless expressly defined in this Agreement, have the same
      meaning in this Agreement.

	 	 
	1.2.2 	
      The provisions of Clauses 1.3 (Construction) and 1.4
      (Third Party Rights) of the Common Terms Agreement apply to this Agreement
      as though they were set out in full in this Agreement, except that any reference in that
clause to the Common Terms Agreement is to be construed as references to this
Agreement. 

4

	1.2.3 	
      Any undertaking of the Cedent under this Agreement
      remains in force until the Final Discharge Date.

	 	 
	1.2.4 	
      If any Secured Creditor considers that an amount paid to
      it under a Finance Document is capable of being avoided or otherwise set
      aside on the sequestration, liquidation, business rescue or administration
      of the payer or otherwise, then that amount will not be considered to have
      been irrevocably discharged for the purposes of this
  Agreement.

	2. 	
      PLEDGE AND CESSION IN
SECURITY

	2.1 	
      Pledge and cession

	 	 
		
      The Cedent hereby pledges to the Secured Creditors all
      its Shares and cedes in securitatem debiti to the Secured
      Creditors, jointly and severally, all its Secured Property, in each case
      individually and collectively with all other Secured Property, as
      continuing general covering collateral security for the due, proper and
      punctual payment and performance in full of all the Secured Obligations,
      on the terms set out in this Agreement, which pledge and cession the
      Secured Creditors accept.

	 	 
	2.2 	
      Nature of pledge and
cession

	2.2.1 	
      The pledge and cession contemplated by this Agreement are
      intended to operate as a pledge and a cession of each part and all of the
      Shares and the Secured Property, individually and collectively.

	 	 
	2.2.2 	
      If, for any reason, any Security intended to be created
      under this Agreement is or becomes illegal, invalid or unenforceable in
      respect of some of the Shares or the Secured Property, the pledge of those
      Shares and the cession of that Secured Property shall be severed from this
      Agreement, and this Agreement and all the Security created over the
      remainder of the Secured Property shall continue in full force and
      effect.

	 	 
	2.2.3 	
      The cession contemplated by this Agreement operates as a
      security cession and not as an outright cession, and the Cedent retains
      bare ownership of all the Secured Property, subject to the rights of the
      Secured Creditors as secured creditors under this
  Agreement.

	2.3 	
      Cedent remains liable to perform
  obligations

	 	 
		
      Notwithstanding any other provision of a Finance
      Document, the Cedent shall remain liable to perform all its duties and
      obligations, whether contractual or otherwise, in respect of the Secured
      Property and nothing in this Agreement or the exercise by a Finance Party
      of any right under a Finance Document shall constitute or be deemed to
      constitute a delegation to or acceptance by a Finance Party of any
      obligation of the Cedent or any other person.

	3. 	
      DURATION

	 	 
		
      This Agreement and the Security created pursuant to this
      Agreement:

	3.1 	
      comes into full force and effect on the Signature Date
      without any further action, consent or authority required from any
      person;

	 	 
	3.2 	
      unless otherwise agreed by the Secured Creditors, shall
      not terminate before the Final Discharge Date; and

5

	3.3 	
      shall remain of full force and effect, notwithstanding
      any intermediate discharge or settlement of, or temporary fluctuation in,
      the Secured Obligations.

	4. 	
      REPRESENTATIONS AND WARRANTIES BY THE
  CEDENT

	4.1 	
      General

	4.1.1 	
      The Cedent makes the representations and warranties set
      out in this Clause 4 to each Finance Party on each day that this Agreement
      is in force. References in this Clause to "it" or "its",
      unless the context otherwise requires, is a reference to the
  Cedent.

	 	 
	4.1.2 	
      The Finance Parties enter into the Finance Documents on
      the strength of and relying on the representations and warranties set out
      in this Clause 4, each of which is a separate representation and warranty,
      given without prejudice to any other representation or warranty and is
      deemed to be a material representation or warranty (as applicable)
      inducing the Finance Parties to enter into the Finance
  Documents.

	4.2 	
      Status

	4.2.1 	
      It is a limited liability company, duly incorporated and
      validly existing under the laws of South Africa.

	 	 
	4.2.2 	
      It has the power to own its assets (including all the
      Secured Property) and carry on its business as it is being
    conducted.

	4.3 	
      Powers and authority

	 	 
		
      It has the power to enter into and perform, and has taken
      all necessary action to authorise the entry into and performance of, this
      Agreement and the transactions contemplated by this Agreement.

	 	 
	4.4 	
      Legal validity

	 	 
		
      This Agreement:

	4.4.1 	
      creates the Security it purports to create and is not
      liable to be avoided or otherwise set aside on its liquidation or business
      rescue or otherwise; and

	 	 
	4.4.2 	
      constitutes its legally valid and binding obligation,
      enforceable against it in accordance with its
terms.

	4.5 	
      Non-conflict

	 	 
		
      Its entry into and the performance of its obligations
      under this Agreement, the transactions contemplated by and the Security
      created under this Agreement, do not and will not conflict
  with:

	4.5.1 	
      any law or regulation applicable to it;

	 	 
	4.5.2 	
      its constitutional documents; or

	 	 
	4.5.3 	
      any material agreement or instrument binding upon it or
      any of its assets, or constitute a default or termination event (however
      described) under any such document.

6

	4.6 	
      Authorisations

	4.6.1 	
      All authorisations required by it in connection with the
      entry into, performance, validity and enforceability of, the transactions
      contemplated by and the Security established under, this Agreement have
      been obtained or effected (as appropriate) and are in full force and
      effect.

	 	 
	4.6.2 	
      If it is required to give notice to or obtain consents or
      waivers from any person to pledge the Shares and cede the Secured Property
      under this Agreement, all such notices have been given and consents or
      waivers obtained before the Signature Date.

	4.7 	
      Secured Property

	4.7.1 	
      The Secured Property is and will be valid and all rights
      evidenced thereby or which exists in respect thereof are and will be
      legally valid, binding and fully enforceable in accordance with their
      terms in all respects.

	 	 
	4.7.2 	
      It is and will remain the sole legal and beneficial owner
      of all of the Secured Property over which it purports to grant the
      Security under this Agreement, to the exclusion of all others.

	 	 
	4.7.3 	
      No person has an option or right of refusal over the
      Secured Property or any part thereof which would apply on an enforcement
      by a Secured Creditor of its rights under this Agreement.

	 	 
	4.7.4 	
      No part of the Secured Property has been pledged, ceded
      (either outright or as security), discounted, factored, mortgaged under
      notarial bond or otherwise, or otherwise disposed of or hypothecated, nor
      is it subject to any other right or claim in favour of any person
      (including any rights of pre-emption) which would apply on enforcement by
      a Secured Creditor of its rights under this Agreement. If any Secured
      Property is subject to Security in breach of this representation and
      warranty then, without prejudice to any other rights that the Secured
      Creditors may have, any reversionary or other interests the Cedent may
      have in the said Secured Property are also ceded to the Secured
      Creditors.

	 	 
	4.7.5 	
      The Shares are fully paid-up and have been validly issued
      or transferred to it in compliance with all applicable laws and
      regulations and are held in uncertificated form.

	 	 
	4.7.6 	
      The CSP in respect of the Shares for the time being is
      RMB Morgan Stanley Proprietary Limited.

	5. 	
      UNDERTAKINGS BY THE CEDENT

	 	 
		
      The Cedent is bound by the undertakings set out in this
      Clause 5. The undertakings in this Clause 5 remain in force from the
      Signature Date until the Final Discharge Date.

	5.1 	
      Negative pledge

	 	 
		
      The Cedent:

	5.1.1 	
      shall not grant or permit to exist any further Security
      over any Secured Property or dispose of the Secured Property in any manner
      without the express prior consent of the Secured Creditors; and

	 	 
	5.1.2 	
      must at all times keep the Secured Property free of
      judicial attachments and other Security.

7

	5.2 	
      Preservation of Secured
Property

	5.2.1 	
      The Cedent undertakes:

	 	(a) 	
      to the extent reasonably possible, that it shall not
      permit any material depreciation of the value of, or a variation of rights
      relating to, the Secured Property or any of them to occur without the
      express prior consent of the Secured Creditors;

	 	 	 
	 	(b) 	
      not to take or omit to take any action which could
      reasonably be expected to adversely affect the rights of the Secured
      Creditors under this Agreement or the effectiveness of the Security
      created by this Agreement;

	 	 	 
	 	(c) 	
      to take all appropriate steps required from time to time
      for the care, preservation and protection of the Secured Property and the
      rights of the Secured Creditors under this Agreement; and

	 	 	 
	 	(d) 	
      to timeously comply in full with all its obligations in
      respect of the Secured Property, from time to
time.

	5.2.2 	
      The Cedent waives for the benefit of the Secured
      Creditors any and all rights it may have in respect of the Secured
      Property which conflict with or may restrict the rights of the Secured
      Creditors under this Agreement.

	5.3 	
      Shares

	 	 
		
      The Cedent irrevocably authorises each Secured Creditor
      as its agent in rem suam, in respect of any Shares of the Cedent
      which are not in certificated form, to take all steps necessary to ensure
      that an appropriate entry is made in the securities account of the Cedent
      with its CSDP, in accordance with section 39 of the Financial Markets Act,
      to record the relevant Security in those Shares created under this
      Agreement.

	 	 
	5.4 	
      Amounts received on account of Secured
    Property

	 	 
		
      If an Event of Default occurs and is continuing, the
      Cedent shall forthwith pay and transfer to the Secured Creditors or to
      their order, and place them in possession of, all cash and other assets
      received in respect of the Secured Property.

	6. 	
      DELIVERY OF DOCUMENTS

	 	 
		
      The Cedent must deliver the documents set out this Clause
      6 to the Secured Creditors by no later than the Subscription Date (or in
      respect of Secured Property acquired by the Cedent or otherwise arising
      thereafter, as soon as reasonably possible after that property becomes
      Secured Property, but in any event within 5 Business
  Days).

	6.1 	
      Shares

	 	 
		
      The Cedent must deliver to the Secured Creditors, in
      respect of all its Shares, a copy of a notice by its CSP addressed to the
      Secured Creditors, substantially in the form of Schedule 4 (CSDP
      Confirmation).

	 	 
	6.2 	
      Other requirements

	6.2.1 	
      If any Secured Property, or part thereof, is evidenced by
      a document, or when the Cedent holds Security for any obligation owed to
      it in respect of Secured Property and that Security is evidenced by a
      document, the Cedent shall, at the request of the Secured Creditors,
      promptly deliver a certified copy of that document to the Secured
      Creditors.

8

	6.2.2 	
      In addition to the documents referred to above, the
      Cedent shall deliver to the Secured Creditors:

	 	(a) 	
      in respect of all Secured Property acquired by the Cedent
      or otherwise arising after the Signature Date, all information and
      applicable items of documentation referred to in Clause 6.1;

	 	 	 
	 	(b) 	
      any other documents relating to the Secured Property for
      which the Secured Creditors may at any time reasonably
  call,

		
      which documents must be delivered to the Secured
      Creditors within a reasonable period, as agreed between the Secured
      Creditors and the Cedent and, failing such agreement, within 5 Business
      Days.

	 	 
	6.2.3 	
      The Secured Creditors may retain possession of all
      documents delivered to them under this Clause 6 and deal with them in
      accordance with the Finance Documents until the Final Discharge Date,
      after which date they shall be returned to the Cedent as soon as
      reasonably possible.

	 	 
	6.2.4 	
      If any third party consents are required by the Cedent to
      cede any of its Secured Property under this Agreement, it must obtain
      those third party consents before or on the Signature
  Date.

	7. 	
      CORPORATE ACTION IN RESPECT OF THE
SHARES

	 	 
		
      Should, prior to the Secured Creditors exercising any of
      their rights in terms of Clause 9 (Enforcement), any of the Shares be
      sub-divided, consolidated or converted into any other shares, securities
      or rights, or any shares, securities or rights be issued, distributed or
      otherwise received or accrued on account of the Shares in connection with
      any corporate action or distribution made by Blue Label Telecoms or
      otherwise, the sub-divided, consolidated or converted shares, securities
      or rights, or such other issued, distributed, received or accrued shares,
      securities or rights (as the case may be) shall automatically be ceded in
      security and pledged to the Secured Creditors upon the terms of this
      Agreement, and the Cedent shall take all such steps as are necessary to
      ensure such shares, securities or rights are ceded in security and pledged
      to the Secured Creditors in terms of this Agreement, including without any
      limitation, instructing the CSDP to note the cession in security and
      pledge in accordance with section 39 of the Financial Markets Act.
      References in this Agreement to the “Shares” shall thereafter be
      construed to include any such sub- divided, consolidated or converted
      shares, securities or rights, or such other issued, distributed, received
      or accrued shares, securities or rights (as the case may be).

	 	 
	8. 	
      RIGHTS OF THE CEDENT BEFORE
  DEFAULT

	8.1 	
      Unless the Facility Agent has given the Cedent written
      notice of a Default which is continuing, the Cedent is entitled, at its
      own cost, to:

	8.1.1 	
      enforce and receive payment for, delivery of or
      performance in respect of all amounts or obligations owing in respect of
      the Secured Property in the ordinary course of business and, subject to
      the Finance Documents, to appropriate amounts so recovered to its own use
      (including any dividends or other benefits in respect of its Shares and
      Shareholder Claims); and

	 	 
	8.1.2 	
      receive notice of every general meeting of shareholders
      of Blue Label Telecoms (provided that each such notice is to be forwarded
      to the Secured Creditors as if they were shareholders of Blue Label
      Telecoms);

	 	 
	8.1.3 	
      attend every general meeting of the shareholders of Blue
      Label Telecoms, and exercise all the votes attaching to the Shares at such
      meetings (provided that it will not exercise those votes in a manner which
      is reasonably likely to (a) be materially prejudicial to the validity or enforceability of
this Agreement, (b) materially impair the value of any Shares, or (c) be
otherwise materially prejudicial to the Secured Creditors). 

9

	8.2 	
      If the Facility Agent has given the written notice of a
      Default which is continuing as contemplated in Clause 8.1 or an Event of
      Default is continuing, all rights, powers and privileges attaching to the
      Secured Property, including, but not limited to those set out in Clause
      8.1 above, shall vest in the Secured Creditors, jointly or severally, with
      the power to exercise them either in any of their own name or in the name
      of the Cedent. If any Secured Creditor so directs when a Default is
      continuing, the Cedent shall exercise the Secured Creditors' rights,
      powers and privileges in its own name and to the greatest extent permitted
      by applicable law.

	9. 	
      ENFORCEMENT

	9.1 	
      Rights of the Secured Creditors

	 	 
		
      If an Event of Default is continuing, the Secured
      Creditors (or any of them) may, without prejudice to any other rights they
      may have against the Cedent, exercise their rights under this Clause 9,
      and otherwise put into force and effect all rights, powers and remedies
      available to them in relation to the Secured Property, in such manner and
      on such terms and conditions as they in their sole discretion consider
      most expedient. Without limiting the foregoing, if an Event of Default is
      continuing, the Secured Creditors (or any of them) may, and the Cedent
      hereby irrevocably and unconditionally authorises and empowers each of
      them or their nominee, and appoints each of them in rem suam,
      without any further authority or consent of any nature whatsoever required
      from any person, in the name of any or all of the Secured Creditors or
      their nominee or in the name of the Cedent to:

	9.1.1 	
      exercise all or any of the rights, powers and privileges
      and enforce all or any obligations attaching to the Secured Property, in
      such manner and on such terms as the Secured Creditors in their sole
      discretion deem fit;

	 	 
	9.1.2 	
      receive payment for, delivery of, and/or performance in
      respect of, the Secured Property in their own name or that of their
      nominee;

	 	 
	9.1.3 	
      authorise any officer of any Secured Creditor (whose
      appointment need not be proved) to sign, on behalf of and in the name of
      the Cedent, any document that may be necessary to give effect to any
      disposal or realisation of Secured Property by the Secured Creditors under
      this Clause;

	 	 
	9.1.4 	
      at the election of the Secured
  Creditors:

	 	(a) 	
      sell or otherwise realise all or some of the Secured
      Property by public auction;

	 	 	 
	 	(b) 	
      sell or otherwise realise at a Fair Value all or some of
      the Secured Property by private treaty; or

	 	 	 
	 	(c) 	
      take over all or some of the Secured Property at a Fair
      Value,

and, subject to the provisions of
Clause 10 (Appropriation of Proceeds), apply the proceeds of such sale, purchase
or other realisation or transfer (including the purchase price payable for any
Secured Property taken over by the Secured Creditors) against the Secured
Obligations on the basis that any excess upon realisation or balance owing to
the Cedent (as the case may be) will be paid to the Cedent and any shortfall on
realisation will remain a debt due by the Cedent to the Secured Creditors. 

10

		
      For the purposes of paragraph (c) above, the Fair
      Value of any Secured Property will be the value agreed in writing
      between the Secured Creditors and the Cedent or, failing agreement within
      ten Business Days after delivery of a notice to the Cedent stating that
      the Secured Creditors exercise their rights under this Clause 9.1, the
      value determined by an independent chartered accountant employed by either
      PwC, EY, Deloitte or KPMG agreed to by the Secured Creditors and the
      Cedent (or, failing agreement within 5 Business Days, appointed, at the
      request of either Party, by the President of the South African Institute
      of Chartered Accountants, or the successor body thereto), which
      independent accountant shall act as an expert and not as an arbitrator,
      shall be instructed to make his determination within ten Business Days and
      shall determine the liability for his charges (which shall be paid
      accordingly), provided that if a determination is manifestly unjust and a
      court exercises its general power, if any, to correct such determination,
      the Parties shall be bound thereby;

	 	 
	9.1.5 	
      institute any legal proceedings which the Secured
      Creditors may deem necessary in connection with any sale, purchase or
      other realisation or transfer of any of the Secured Property and to
      prosecute such proceedings to their final end and conclusion, including
      the prosecution of such appeals and reviews as the Secured Creditors in
      their discretion may determine;

	 	 
	9.1.6 	
      compromise any of the Secured Property, grant any
      extension or other indulgence in respect of the Secured Property, agree to
      amend the terms of the Secured Property, and/or release any security,
      guarantee or suretyship held for the Secured Property or waive any right
      which relates to or constitutes part of the Secured Property;

	 	 
	9.1.7 	
      give transfer of and convey valid title in any Secured
      Property to any person (including a Secured Creditor); and/or

	 	 
	9.1.8 	
      take all such further or other steps as the Secured
      Creditors may consider necessary to deal with the Secured Property in
      order to give effect to this Agreement.

	9.2 	
      Undertakings by the Cedent in respect of
      realisation

	 	 
		
      On the Secured Creditors taking any action under Clause
      9.1, or otherwise as required by the Secured Creditors if an Event of
      Default is continuing, the Cedent shall on demand by the Secured
      Creditors:

	9.2.1 	
      give written notice to all persons required by the
      Secured Creditors that payment for, delivery of or performance in respect
      of the relevant Secured Property must be made to the Secured Creditors or
      their nominee and that payment, delivery or performance to the Cedent or
      to anyone else will not constitute valid payment, delivery or performance,
      and the Secured Creditors shall be entitled to do likewise. The Cedent
      shall on demand by the Secured Creditors provide proof that such
      notification has been duly given;

	 	 
	9.2.2 	
      refuse to accept any payment, delivery, or performance
      tendered in respect of any of the Secured Property and order that such
      payment, delivery or performance be tendered to the Secured
    Creditors;

	 	 
	9.2.3 	
      forthwith pay over or deliver to the Secured Creditors
      any interest, dividend, negotiable instruments or other monetary benefits
      of any nature accrued or received in respect of the Secured Property after
      the date of an Event of Default, by depositing the same into any bank
      account in South Africa nominated by the Secured
  Creditors;

11

	9.2.4 	
      deliver to the Secured Creditors any property which the
      Cedent acquires or which accrues to it in connection with the Secured
      Property;

	 	 
	9.2.5 	
      at its own cost, carry out any lawful directions the
      Secured Creditors may give in regard to the realisation of Secured
      Property, and sign any document or do any other lawful act necessary
      to:

	 	(a) 	
      vest the Secured Property in the Secured
  Creditors;

	 	 	 
	 	(b) 	
      enable any sale, purchase or other realisation or
      transfer of Secured Property; or

	 	 	 
	 	(c) 	
      perfect and complete (to the extent necessary) the
      cession of any Secured Property under this
Agreement.

	9.3 	
      No obligation on the Secured Creditors

	 	 
		
      Notwithstanding anything to the contrary contained in
      this Agreement, no Secured Creditor shall be obliged to take any steps to
      preserve, protect, collect, recover or otherwise enforce its rights under
      or in respect of the Secured Property.

	10. 	
      APPROPRIATION OF PROCEEDS

	 	 
		
      The Secured Creditors shall apply the net proceeds of all
      amounts received pursuant to the sale or other realisation of Secured
      Property, or from the appropriation of cash amounts which constitute
      Secured Property, under this Agreement (after deducting all properly
      evidenced costs and expenses incurred by the Secured Creditors) in
      reduction or discharge of the Secured Obligations, in such order and in
      such manner as the Secured Creditors deem fit.

	 	 
	11. 	
      PAYMENTS

	 	 
		
      Subject to the Common Terms Agreement, and unless
      otherwise agreed or specified by the Secured Creditors by notice in
      writing, all payments due by the Cedent under this Agreement or in respect
      of the Secured Property shall be made free of any bank or other charges in
      the currency of the Secured Obligation into a bank account, or at such
      other address in South Africa, nominated by the Secured
  Creditors.

	 	 
	12. 	
      POWER OF ATTORNEY

	 	 
		
      The Cedent irrevocably and severally appoints the Secured
      Creditors, jointly and severally, and any of their delegates or
      sub-delegates to be its attorney to take any action which the Cedent is
      obliged to take under this Agreement but has failed to take. The Cedent
      ratifies and confirms whatever any attorney does or purports to do
      pursuant to its appointment under this Clause.

	 	 
	13. 	
      FURTHER ASSURANCES

	 	 
		
      The Cedent shall generally promptly do everything that
      may be required in order to comply with its obligations under this
      Agreement, and as may otherwise be required by the Secured Creditors for
      the purposes of, and to give effect to, this Agreement, failing which the
      Secured Creditors may, to the extent possible, attend thereto on behalf of
      the Cedent and recover on demand from the Cedent any reasonable expenses
      incurred in relation thereto. In particular the Cedent shall execute and
      do all such acts and things as the Secured Creditors, in their reasonable
      discretion, may require:

	13.1 	
      to perfect or protect the Security created (or intended
      to be created) by this Agreement;

	 	 
	13.2 	
      to preserve or protect any of the rights of the Secured
      Creditors under this Agreement;

12

	13.3 	
      to enforce any Security created under this Agreement on
      or at any time after it becomes enforceable;

	 	 
	13.4 	
      for the exercise of any power, authority or discretion
      vested in a Secured Creditor under this Agreement;

	 	 
	13.5 	
      to carry out the effect, intent and purpose of this
      Agreement,

		
      in any such case, forthwith upon demand by the Secured
      Creditors, to the maximum extent permitted by law and at the expense of
      the Cedent.

	 	 
	14. 	
      ADDITIONAL RIGHTS

	 	 
		
      The rights conferred on the Secured Creditors by this
      Agreement are additional to and not in substitution
for:

	14.1 	
      any other rights a Secured Creditor has, or may at any
      time in the future have, against the Cedent or any other person;

	 	 
	14.2 	
      any other Security held or hereafter to be held by a
      Secured Creditor from the Cedent or any other person, in connection with
      the Secured Obligations. A Secured Creditor may release any Security held
      by it without prejudice to its rights under this
  Agreement.

	15. 	
      CEDENT BOUND NOTWITHSTANDING CERTAIN
      CIRCUMSTANCES

	 	 
		
      The Cedent agrees that on signature of this Agreement, it
      will be bound under this Agreement to the full extent hereof, despite the
      fact that:

	15.1 	
      any additional Security from the Cedent or any other
      person for the Secured Obligations may not be obtained or may be released
      or may cease to be held for any other reason;

	 	 
	15.2 	
      the Finance Parties may agree any variation or novation
      of the Finance Documents (including any amendment providing for the
      increase in the amount of the Facility or an additional
  facility);

	 	 
	15.3 	
      any Finance Party may receive a dividend or benefit in
      any insolvency, liquidation or business rescue or any compromise or
      composition, whether in terms of any statutory enforcement or the common
      law;

	 	 
	15.4 	
      the Secured Creditors may grant any indulgences to the
      Cedent or may not exercise any one or more of its rights under the Finance
      Documents, either timeously or at all; or

	 	 
	15.5 	
      any other fact or circumstance may arise on which the
      Cedent might otherwise be able to rely on a defence based on prejudice,
      waiver or estoppel.

		
      If the Cedent suffers any loss arising from any of the
      facts, circumstances, acts or omissions referred to above, it will have no
      claim against any Secured Creditor in respect thereof.

	 	 
	16. 	
      KEEPING, INSPECTION AND DELIVERY OF
  RECORDS

	16.1 	
      The Cedent shall at all times keep up-to-date records of
      the Secured Property and shall comply with any reasonable directions the
      Secured Creditors may give in regard to the keeping of such
  records.

	 	 
	16.2 	
      The Secured Creditors or anyone authorised by the Secured
      Creditors may at any time and on reasonable notice inspect any of the
      Cedent's books of account and other records, including books of account
      and records in the possession of a third party.

13

	16.3 	
      If the Secured Creditors at any time so request, the
      Cedent shall at its own cost deliver to the Secured Creditors or their
      order certified copies of any of the books and records referred to in
      Clauses 16.1 and 16.2 above.

	17. 	
      EXEMPTION FROM
LIABILITY

	17.1 	
      A Secured Creditor, their officers, trustees, agents,
      beneficiaries, employees and advisors (each an Exempt Party) shall
      not be liable for any loss or damage, whether direct, indirect,
      consequential or otherwise, suffered by the Cedent howsoever arising in
      connection with this Agreement, whether that loss or damage arises as a
      result of a breach of contract (whether total, fundamental or otherwise),
      delict or any other cause, and whether this Agreement has been terminated
      or not, other than as a result of the gross negligence or wilful
      misconduct of that Exempt Party.

	 	 
	17.2 	
      The Cedent hereby indemnifies (and agrees to keep
      indemnified) and holds harmless the Secured Creditors and their respective
      officers, trustees, agents, beneficiaries, employees and advisors against
      any and all losses, claims, damages or liabilities (excluding any
      consequential damages, loss or liability (including opportunity cost)) to
      which they may become subject under or in connection with this Agreement,
      and agrees to reimburse the Secured Creditors for any legal or other
      expenses reasonably incurred by them in connection with investigating or
      defending any such loss, claim, damage, liability or action; provided that
      the Cedent will not be liable to any particular Secured Creditor in any
      such case to the extent that any such loss, claim, damage or liability of
      that Secured Creditor arises out of the gross negligence or wilful
      misconduct of that Secured Creditor or any of its officers, trustees,
      agents, beneficiaries, employees and advisors, as the case may
  be.

	18. 	
      CHANGES TO THE PARTIES

	18.1 	
      Transfers by a Secured
Creditor

	18.1.1 	
      A Secured Creditor may cede any of its rights and/or
      delegate any of its obligations under this Agreement to any person to whom
      it cedes any of its rights and/or delegates any of its obligations under
      the Finance Documents. The Cedent agrees to co-operate and take all such
      steps as a Secured Creditor may reasonably request to give any such
      transferee the benefit of this Agreement.

	 	 
	18.1.2 	
      To the extent that a splitting of claims arises as a
      result of any actions taken under Clause 18.1.1 above, the Cedent hereby
      consents to such splitting of claims.

	18.2 	
      Stipulation for the benefit of future Secured
      Creditors

	 	 
		
      The provisions of this Agreement which confer benefits on
      the Secured Creditors constitute stipulations for the benefit of any
      person who becomes a Finance Party and a Secured Creditor after the
      Signature Date, and shall be capable of acceptance by that person at any
      time. To the extent that a splitting of claims arises as a result of the
      provisions of this Clause, the Cedent hereby consents to such splitting of
      claims.

	 	 
	18.3 	
      Transfers by the Cedent

	 	 
		
      The Cedent may not cede any of its rights nor delegate
      any of its obligations under this Agreement.

	19. 	
      SEVERABILITY

	 	 
		
      Each term of this Agreement, whether forming an entire
      clause or only part of a clause, is divisible and severable from all the
      other terms (regardless of the manner in which they
may be linked together or grouped grammatically). If a term or
provision of this Agreement is or becomes illegal, invalid or unenforceable in
any respect in any jurisdiction, that will not affect:

14

	19.1 	
      the legality, validity or enforceability in that
      jurisdiction of any other term or provision of this Agreement which shall
      remain in full force and effect, and such illegal, invalid or
      unenforceable term or provision shall be severed from this Agreement;
      or

	 	 
	19.2 	
      the legality, validity or enforceability in other
      jurisdictions of that or any other term of this
  Agreement,

		
      and in particular, a Secured Creditor shall be entitled
      to deal with its rights in respect of the Secured Property in such manner
      as is sanctioned or approved in terms of a court order or as is otherwise
      legally permissible.

	 	 
	20. 	
      GOVERNING LAW

	 	 
		
      This Agreement and any non-contractual obligations
      arising out of or in connection with it are governed by South African
      law.

	 	 
	21. 	
      JURISDICTION

	21.1 	
      The Parties hereby irrevocably and unconditionally
      consent to the non-exclusive jurisdiction of the High Court of South
      Africa (Gauteng Local Division, Johannesburg) (or any successor to that
      division) in regard to all matters arising from this Agreement (including
      a dispute relating to the existence, validity or termination of this
      Agreement or any non-contractual obligation arising out of or in
      connection with this Agreement) (a dispute).

	 	 
	21.2 	
      The Parties agree that the courts of South Africa are the
      most appropriate and convenient courts to settle disputes. The Parties
      agree not to argue to the contrary and waive objection to this court on
      the grounds of inconvenient forum or otherwise in relation to proceedings
      in connection with this Agreement.

	 	 
	21.3 	
      This Clause 21 is for the benefit of the Secured
      Creditors only. As a result, the Secured Creditors shall not be prevented
      from taking proceedings relating to a dispute in any other court with
      jurisdiction. To the extent allowed by law, the Secured Creditors may take
      concurrent proceedings in any number of
jurisdictions.

	22. 	
      MISCELLANEOUS MATTERS

	22.1 	
      Amendments, waivers and
  cancellation

	22.1.1 	
      No contract varying, adding to, deleting from or
      cancelling this Agreement will be effective unless reduced to writing and
      signed by or on behalf of the Parties.

	 	 
	22.1.2 	
      The expiry or termination of this Agreement will not
      prejudice the rights of the Secured Creditors in respect of any antecedent
      breach by the Cedent of, or non- performance under, this
  Agreement.

15

	22.2 	
      Certificates and Determinations

	 	 
		
      Any certification or determination by a manager of a
      Secured Creditor (whose appointment need not be proved) as to the
      existence of and the amount of indebtedness by the Cedent to the Secured
      Creditors, that such amount is due and payable, the amount of interest
      accrued thereon and as to any other fact, matter or thing related to the
      Cedent's indebtedness under the Finance Documents shall be, in the absence
      of manifest error, prima facie evidence of contents and correctness
      of the matters to which it relates for the purposes of provisional
      sentence, summary judgement or any other proceedings, shall be valid as a
      liquid document for such purposes and shall, in addition, be prima facie proof
for purposes of pleading or trial in any action instituted against the Cedent
arising herefrom. 

THIS AGREEMENT has been entered into on the date stated
at the beginning of this Agreement. 

16

SCHEDULE 1 

CSDP CONFIRMATION 

	To: 	FIRSTRAND BANK LIMITED (ACTING THROUGH ITS
      RAND MERCHANT BANK DIVISION) 
	  	[•] 
	  	[•] 
	  	  
	From: 	[•] (the CSP) 

[Date] 

Dear Sirs, 

Cession and Pledge in Security dated [•]
October, 2016 
by Net1 Applied Technologies South Africa Proprietary Limited
of FirstRand Bank Limited 
(acting through its Rand Merchant Bank division)

(the Security Cession and Pledge) 

	1. 	
      We refer to the Security Cession and Pledge (a copy of
      which has been furnished to us by the Cedent).

	 	 
	2. 	
      Unless expressly otherwise defined in this letter, terms
      and expressions defined in the Security Cession and Pledge have the same
      meaning where used in this letter.

	 	 
	3. 	
      We confirm that we, as the CSP of the Cedent, are holding
      to the order of the Secured Creditors, on behalf of the Cedent, [•]
      ordinary shares in the issued share capital of Blue Label Telecoms Limited
      (the Company), which are beneficially owned by the
Cedent.

	 	 
	4. 	
      We confirm, in respect of the Shares
  that:

	4.1 	
      we are an authorised user as contemplated under the
      Financial Markets Act, 2012 (the Act); and

	 	 
	4.2 	
      an entry in favour of the Secured Creditors has been made
      in the applicable sub- register as contemplated in section 39 of the
      Act.

	5. 	
      Until we have been advised in writing by the Secured
      Creditors that the Final Discharge Date has occurred, we undertake
      that:

	5.1 	
      unless and until otherwise notified in writing by the
      Secured Creditors, we shall act solely in accordance with the instructions
      of the Secured Creditors which shall override any conflicting instructions
      or directions given to us by another person;

	 	 
	5.2 	
      we shall not transfer the Shares (or any part thereof) or
      any interest therein except with the prior written consent of the Secured
      Creditors;

	 	 
	5.3 	
      we shall hold the Shares in the name of Net1 Applied
      Technologies South Africa Proprietary Limited, subject to the terms of the
      Act;

	 	 
	5.4 	
      [we shall pay all distributions in respect of the Shares
      directly into the following bank account:

17

	 	Bank: 	[•] 	  
	 	 	 	 
	 	Branch number: 	[•] 	  
	 	 	 	 
	 	Account number: 	[•] 	  
	 	 	 	 
	 	Named account beneficiary: 	[•]]; 	and 

	5.5 	
      with effect from the date on which the Secured Creditors
      notifies us in writing that a Default is
continuing:

	5.5.1 	
      (and thereafter until otherwise notified by the Secured
      Creditors), we shall make all payments to be made in respect of its Shares
      direct to the Secured Creditors by payment into any bank account nominated
      by them in writing or otherwise as they may direct;

	 	 
	5.5.2 	
      if instructed to do so by the Secured Creditors, we shall
      transfer the Shares to the Secured Creditors or another person nominated
      by them.

Yours faithfully, 

 

	For and on
      behalf of: 	 	For and on behalf of: 
	[•] 	 	 	[•] 	 
	 	 	 	 	 
	Name: 	 	 	Name: 	 
	 	 	 	 	 
	Date: 	 	 	Date: 	 

Net1 Applied Technologies South Africa Proprietary Limited, by
its signature hereto, irrevocably authorises any action undertaken by the CSP
pursuant to this letter of undertaking. This authorisation may not be revoked or
amended without the prior written consent of the Secured Creditors. 

 

	For and on
      behalf of: 	 
	Net1 Applied Technologies South 	 
	Africa Proprietary Limited 	 
	  	  	 
	Name: 	 
    	 
	  	  	 
	Date: 	 
    	 

18

SIGNATURE PAGE 

THE CEDENT 

 

	For and on
      behalf of: 	 
	Net1 Applied Technologies South 	 
	Africa Proprietary Limited 	 
	 	 
	Name: 	/s/
      Herman G. Kotzé 	 
	 	 	 
	Office: 	Chief
      Financial Officer 	 
	  	(who warrants his authority)
	 

19 

SIGNATURE PAGE 

THE SECURED CREDITOR 

 

	For and on behalf of:
    	 	For and
      on behalf of: 
	FirstRand Bank Limited (acting through 	 	FirstRand Bank Limited (acting through
    
	its Rand Merchant Bank division) 	 	its Rand Merchant Bank division)
  

	Name: 	/s/ Niel van Zyl 	 	Name: 	/s/
      Ziyaad Manie 
	 	 	 	 	 
	Office: 	Authorised 	 	Office: 	Authorised 
	  	(who warrants his authority) 	 	  	(who warrants his authority)

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00263-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00263-of-00352.parquet"}]]