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CONTENTS

1. 	DEFINITIONS AND INTERPRETATION 							5

2. 	SUSPENSIVE CONDITION 								13

3. 	STRATEGIC SERVICES AND PERSONNEL 						14

4.

	PROVISION OF PERSONNEL BY SBCI-MSI AND TMS 					17

5. 	ADDITIONAL CONTRIBUTION 								18

6. 	ST POSITIONS 									18

7. 	USM POSITIONS 									19

8. 	VACANCIES 									21

9. 	REMOVALS 									25

10.

	TRANSFORMATION 								26

11. 	COSTS AND CHARGES 								27

12. 	ADDITIONAL OBLIGATIONS 								28

13. 	MANAGEMENT STRUCTURE 								29

14. 	SETTLEMENT OF DISPUTES 								30

15. 	REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS 					35

16. 	INDEMNIFICATION 									38

17. 	TERMINATION 									39

18.

	CONFIDENTIALITY 									41

19. 	GOVERNING LAW 									44

20. 	NOTICES 									44

21. 	ENTIRE AGREEMENT 								47

22. 	ASSIGNMENT 									47

23. 	SUBCONTRACTING 								47

24. 	WAIVER OF SOVEREIGN IMMUNITY 							48

25. 	FORCE MAJEURE 									48

26. 	COUNTERPARTS 									48

27. 	SEVERABILITY 									49

28. 	WAIVER 										49

29. 	AMENDMENTS AND MODIFICATIONS 							49

30.

	NO PARTNERSHIP OR AGENCY 							49

31. 	THIRD PARTY BENEFICIARIES 							50

APPENDIX 1: 	MANAGEMENT STRUCTURE

APPENDIX 2: 	SCHEDULE OF AUTHORISATIONS

APPENDIX 3: 	LONG-TERM PERSONNEL PAYMENT SCHEDULE

APPENDIX 4: 	SHORT-TERM PERSONNEL PAYMENT SCHEDULE

APPENDIX 5: 	AGGREGATE ANNUAL PAYMENT SCHEDULE

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1.

DEFINITIONS AND INTERPRETATION

1.

In this Agreement and the preamble above:

1. 1.

"Affiliate"

means in relation to any person, any other person

which controls, is controlled by, or is under

common control with the first person (where

control is the possession, directly or indirectly, of

the power to direct or cause the direction of the

management and policies of any person through

ownership of shares, debentures, partnership

interests or otherwise) and shall include, without

limitation, when used with respect to (a) any

person, any subsidiary of such person; and (b) the

SEP, Affiliates of the SEP and those of its owners,

provided that for the purposes of this Agreement,

Telkom shall not be considered an Affiliate of the

SEP or any of the Affiliates of the SEP's owners;

1. 1. 2

"this Agreement"

means this Strategic Services Agreement, as

amended from time to time;

1. 1. 3

1. 1.4

"Board"

"CEO"

means the board of directors of Telkom;

means the incumbent for the time being of the ST

Position of "CEO Telkom Group";

1. 1.5

"COO"

means the incumbent for the time being of the ST

Position of "COO Telkom";

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1.1.6

"CSO"

means the incumbent for the time being of the ST

Position of "CSO";

1.1.7

"Commencement

Date"

means the first day following that on which the

whole of this Agreement becomes unconditional in

terms of Clause 2 .4 below;

1.1.8

"Dollars" or "US$"

means the lawful currency for the time being of the

United States of America,

1.1.9

"Exchange Control

Approvals"

means any and all exchange control or similar

governmental approvals which shall, from time to

time, be required for the payment by Telkom of the

amounts provided for herein in connection with the

provision of the Strategic Services or for the

transfer of such amounts from South Africa to any

other jurisdiction,

1.1.10

"GE-HR"

means the incumbent for the time being of the ST

Position of "GE-HR",

1.1.11

"Historically

Disadvantaged

Individuals"

means South African persons historically

discriminated against on the basis of race, colour,

origin or gender in South Africa;

1.1.12

"HRRC"

means the 'Human Resources Review

Committee of the Board established pursuant to

Telkom's Articles of Association;

1.1.13

"Initial Strategic 	            means the Strategic Services Agreement dated 14

Services Agreement"          May 1997, as amended by Addendum No 1 to it

dated as of 15 May 2002, among the Parties and

which is superseded by this Agreement on and

with effect from the Commencement Date;

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1. 1.14

"Long-Term

Personnel"

means Personnel who are assigned to work in

South Africa for not less than 1 (one) year;

1.1.15

"Malaysian

Personnel"

means Personnel who immediately prior to

providing Strategic Services to Telkom were

domiciled in Malaysia;

1.1.16

"Management

Structure"

means the management structure of Telkom, as of

the Commencement Date, as shown in Appendix 1

attached hereto and as may be amended from

time to time;

1.1.17

"Minister"

means the Minister for Communications of the

Government of South Africa;

1.1.18

"MTSA"

means the Management and Technical Services

Agreement, dated 26 February 1997 among the

SEP, SBCI-MSI and TMS;

1.1.19

"Original

Shareholders'

Agreement"

means the shareholders' agreement among

Telkom, the Minister and the SEP dated 14 May

1997, as amended by amendment No. 1 dated 18

February 1999, which is being terminated in terms

of a termination agreement which is being entered

into among the same parties at or about the same

time as this Agreement;

1.1.20

"Other Personnel"

means Personnel who are not Malaysian

Personnel or US Personnel;

1.1.21

"Parties"

means the parties to this Agreement, and a "Party"

means any one of them as the context may

require;

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1. 1.22

"Permit"

shall mean any work, residence, immigration or

other permit, licence or clearance which, under the

laws of South Africa, is required to be obtained

and/or maintained by the SEP, any Personnel

Provider and/or Personnel in connection with the

provision of the Strategic Services hereunder;

1. 1.23

"Personnel"

means persons who provide Strategic Services

under this Agreement;

1. 1.24

"Personnel Provider"

means, with respect to any Personnel, any person

which directly or indirectly provides such

Personnel to Telkom at the request of the SEP for

the purpose of providing the Strategic Services;

and for purposes of this Agreement, shall include,

without limitation, SBCI-MSI and TMS (to the

extent they provide Personnel pursuant to

Clause 4 of this Agreement); and such other

Affiliates of SBCISA and TMA respectively, chosen

by the SEP in its sole and absolute discretion,

which may from time to time provide Personnel at

the request of the SEP to perform the Strategic

Services as contemplated by this Agreement;

1. 1.25

"PSTS Licence"

means the licence for the provision of public

switched telecommunication services issued to

Telkom by the Minister pursuant to Section 36 of

the Telecommunications Act;

1. 1.26

"Restated

Shareholders'

Agreement"

means the new shareholders' agreement which is

being entered into among the Minister and the

SEP at or about the same time as this Agreement,

and which will replace the Original Shareholders'

Agreement;

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1. 1.27

"SBCI"

means SBC International Inc., a company

incorporated under the laws of the State of

Delaware of the United States of America, and a

parent company of SBCISA and SBCI-MSI on the

date hereof;

1. 1.28

"SBCISA"

means SBC International South Africa LLC, a

limited liability company organised under the laws

of the State of Delaware of the United States of

America;

1.1.29

"Schedule of

Authorisations"

means the schedule or other record of the nature

and extent of any authorities conferred on

members of the Management Structure set forth in

Appendix 2 attached hereto;

1. 1.30

"Search Committee"            means a committee of Telkom constituted in

accordance with the provisions of Clause 8. 1. 2

below;

1.1.31

"SEP Appointee"

means an incumbent for the time being of an SEP

Position;

1.1.32

"SEP Class B

Positions"

means the positions identified in the Management

Structure by the letter "B" as "SEP Appointments";

1.1.33

"SEP Class B*

Positions"

means the positions identified in the Management

Structure by the letter "B*" as "SEP Appointments"

which, when the Management Structure was

adopted, were being filled by Historically

Disadvantaged Individuals in anticipation of the

Transition Period as contemplated in clause

4. 05(c) of the Original Shareholders' Agreement;

1.1.34

"SEP Class C

means the USM Positions identified in the

Page

Positions"

Management Structure by the letter "C" as "SEP

Appointments", but to be made only as and when

requested by Telkom and agreed to by the SEP in

accordance with the provisions of Clause 7. 2

below;

1. 1.35

"SEP Positions"

means the positions which the SEP is entitled to fill

in terms of the Management Structure, being the

SEP Class B Positions, the SEP Class B*

Positions and the SEP Class C Positions;

1. 1. 36

"SEP Strategic

Positions"

means the 2 (two) positions shown in the

Management Structure as "♦2 Group Executives

B" with reporting lines to the CEO;

1.1.37

"Shares"

means the ordinary shares of Telkom, each of

R10.00 par value or such other value determined

in accordance with the Memorandum and Articles

of Association of Telkom;

1. 1.38

"Share Transfer

Agreement"

means the Share Transfer Agreement among the

SEP, Telkom and the Minister dated

26 March 1997;

1. 1.39

"Short-Term

Personnel"

means Personnel who are assigned to work in

South Africa for less than 1 (one) year;

1.1.40

"Signature Date"

means the date on which this Agreement is last

signed by the Parties;

1. 1.41

"Significant

Shareholder"

shall have the meaning ascribed to it in the

Restated Shareholders' Agreement;

1. 1.42

"South Africa"

means the Republic of South Africa;

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1.1.43

"ST Positions"

means the separate positions shown in the

Management Structure for which specific titles are

shown in an abbreviated form, such as "CTO",

"CFO", "ME Bus/Govt", "GE Corp Corns" and "MD

TDS" (which are mentioned by way of examples

only), and shall include the SEP Strategic

Positions, and which are all the positions shown in

the Management Structure other than the USM

Positions;

1.1.44

"Strategic Services"

means certain management and technical services

and advice to be provided to the Telkom Group by

Personnel in accordance with the terms and

conditions of this Agreement which relate to the

following ;business management, oversight of

personnel matters, development and

implementation of marketing plans and other

corporate strategies, network planning and

supervision, network operations, budget planning,

payroll processing, internal financial support

services, technical advice and assistance,

regulatory compliance, customer billing and other

related services;

1.1.45

"Telecommunications           means the Telecommunications Act, No. 103 of

Act"                                    1996 of the laws of South Africa as in effect on the

date hereof and as amended from time to time;

1.1.46

"Telkom Group"

1.1.47

"Telkom Positions"

means Telkom, its subsidiaries and Affiliates from

time to time and shall be deemed to include

Vodacom;

means the positions identified in the Management

Structure by the letter "A" as positions to be filled

by Telkom;

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1. 1.48

"TMA"

means Telekom Malaysia Africa Sdn. Bhd., a

corporation organised under the laws of Malaysia;

1. 1. 49

1.1.50

"TMB"

"Transition Period"

means Telekom Malaysia Berhad, a company

incorporated under the laws of Malaysia and the

ultimate parent company of TMA and TMS;

means the period defined as such in the Original

Shareholders' Agreement;

1. 1.51

"US Personnel"

means Personnel who immediately prior to

providing Strategic Services to Telkom were

domiciled in the United States;

1. 1.52

"USM Positions"

means the 24 (twenty-four) positions for senior

managers shown in the Management Structure as

"# Senior Managers B" and "V Senior Managers

C" whose reporting lines are flexible in the

Management Structure and for whom no specific

titles are designated; and

1. 1.53

"Vodacom"

means each of Vodacom Group (Proprietary)

Limited, Vodacom (Proprietary) Limited and their

subsidiaries.

1.2

In this Agreement and the preamble above:

1. 2.1

references to a person include, without limitation, an individual, firm, a

body corporate and an unincorporated association of persons;

1. 2.2

references to a natural person include his or her estate and personal

representatives;

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2. 2

Subject to Clause 2. 1 above, the whole of this Agreement shall be subject to

the fulfilment of the suspensive condition that by 30 November 2003 or by

such later date as may be agreed upon in writing by the Parties before 30

November 2003 any necessary Exchange Control Approvals required for

entering into and implementing this Agreement are duly obtained in writing in

accordance with the requirements of those Regulations.

2. 3

If the suspensive condition referred to in Clause 2. 2 above is not fulfilled by

30 November 2003 or by such later date as may be agreed upon in writing by

the Parties before 30 November 2003 then the provisions of this Agreement

that are suspended shall not take effect and those that have taken effect and

become operative shall fall away, unless otherwise agreed in writing by the

Parties.

2. 4

If the suspensive condition referred to in Clause 2. 2 above is fulfilled then all

the provisions of this Agreement, which were suspended, in terms of

Clause 2. 2 above shall also take effect and become operative, and the whole

of this Agreement shall accordingly become unconditional.

2. 5

Each Party shall sign all such documents and do everything else that may

reasonably be required of it by the other Parties to bring about the fulfilment

of the suspensive condition referred to in Clause 2. 2 above, and all of the

Parties shall co-operate with each other in all respects to that end.

3. 	STRATEGIC SERVICES AND PERSONNEL

3. 1

From the Commencement Date until the expiration or termination of this

Agreement in accordance with Clause 17 below, and, subject to the

provisions of this Agreement, the SEP shall, subject to obtaining any Permits,

be entitled and obligated to provide Personnel to Telkom to serve as SEP

Appointees to provide Strategic Services to Telkom, provided such Personnel

are appointed in compliance with the provisions of this Agreement.

3. 2

All candidates for SEP Positions submitted to Telkom pursuant to this

Agreement shall be selected in the sole and absolute discretion of the SEP.

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Such discretion shall include whether Personnel are Malaysian Personnel,

US Personnel or Other Personnel

3.3

Subject to the provisions of this Agreement, all SEP Appointees shall be

appointed, dismissed and replaced by Telkom at the exclusive direction of the

SEP, and the SEP shall be entitled to require the removal and replacement of

all SEP Appointees with or without cause from time to time, in its sole

discretion.

3.4

Subject to Clause 9 1 below, no SEP Appointee shall be dismissed without

the SEP's approval except by the Board for gross incompetence, breach of

any of Telkom's policies against discrimination (based on, inter alia, race,

sex, national origin or colour) or repeated or significant breaches of any other

policies of Telkom, breach of duty to Telkom or other just cause If any SEP

Appointee is removed pursuant to this Clause 3 4, then the SEP shall be

entitled to appoint such person's replacement, it being expressly agreed that

the SEP's rights with respect to SEP Appointees shall not be affected in any

manner by such removal.

3.5

The SEP shall be entitled to provide to Telkom (or arrange to be provided to

Telkom) Long-Term Personnel and Short-Term Personnel as SEP

Appointees, for purposes of this Agreement and Telkom shall be obliged to

appoint such Personnel to perform Strategic Services, provided that:

3.5.1

except as otherwise provided in this Agreement, the fees payable by

Telkom to the SEP and all Personnel Providers hereunder in

connection with their provision of Personnel, shall not exceed the

annual amounts set forth in Appendix 5; and

3.5. 2                                       if in any such year, amounts payable under this Agreement to the SEP

and Personnel Providers exceed in the aggregate the amount set forth

in Appendix 5 with respect to such year, Telkom and the SEP shall

negotiate in good faith to reach agreement regarding additional fees, if

any, to be paid by Telkom to the SEP or any Personnel Provider for

Personnel thereafter provided to Telkom during such year

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3. 6

Subject to Clause 4 below, the SEP, in its sole and absolute discretion may,

from time to time, substitute (or arrange for the substitution of) Malaysian

Personnel or US Personnel provided to Telkom to provide the Strategic

Services with Other Personnel (and vice versa). In the event that any Other

Personnel are provided to Telkom to provide Strategic Services, Telkom shall

pay a fee to the SEP or the Personnel Provider which provides such

Personnel, as applicable, with respect to any such other Personnel, in

accordance with Clause 11 in an amount equal to the corresponding fee set

forth with respect to US Personnel in Appendices 3 or 4, as applicable,

except that if (i) such Other Personnel are domiciled in South Africa prior to

their appointment by the SEP to provide the Strategic Services and (ii) such

Other Personnel is appointed to fill a SEP Position other than a ST position,

then the fee payable shall be commensurate with the amount normally paid to

a South African counterpart employed by Telkom.

3. 7

Telkom shall be obliged to accept Personnel provided to it by the SEP or a

Personnel Provider pursuant to this Clause 3 in the position for which they

are provided. No Personnel provided by the SEP or any Personnel Provider

to Telkom hereunder shall be deemed an employee or agent of Telkom by

virtue of such arrangement but such Personnel shall nevertheless comply

with Telkom's policies, codes of conduct and delegation of authority

applicable generally to all Telkom employees as if such Personnel were

Telkom employees. No Personnel provided to Telkom by any Personnel

Provider hereunder shall be deemed an employee or agent of the SEP. In

addition, all such Personnel shall be subject to the normal appraisal

procedures for employees of Telkom as if they were employees of Telkom

and the results of such appraisals shall be taken into account by the SEP and

any other Personnel Provider.

3. 8

Notwithstanding any provision contained in this Clause 3 to the contrary,

upon mutual agreement by the SEP and the CEO (on behalf of Telkom), the

SEP may fill an SEP Position with a Telkom employee, or a South African

national currently residing in South Africa as a Telkom employee, provided

that:

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3 8. 1                              such employee shall be employed by Telkom and be subject to

Telkom's conditions of employment;

3 8. 2                              the SEP shall retain the right to terminate or otherwise remove or

replace such Telkom employee or South African national in its sole

discretion and to fill a vacancy arising upon the termination of the

employment of such Telkom employee; and

3. 8. 3

Telkom shall be liable directly to such Personnel for the payment of all

remuneration (including all perquisites) payable to them, and none of

which shall be credited against the aggregate annual payment set forth

in Appendix 5.

3. 9

An appointment under Clause 3. 8, including but not limited to Clause 3. 8. 2

above, shall not be interpreted as a modification of SEP Positions or a

relinquishment of an SEP Position from the Management Structure for

purposes of Clause 13. 2 below, however, all the SEP rights with respect to

such position shall be suspended until the position becomes vacant.

3. 10

The Parties agree that the SEP Appointees will use reasonable efforts to

inform the relevant Telkom managers of and co-ordinate with Telkom leave,

holidays, and other absences. The SEP shall give due consideration to

performance at Telkom when making internal personnel decisions related to

SEP Appointees.

4. 	PROVISION OF PERSONNEL BY SBCI-MSI AND TMS

4. 1

SBCI-MSI shall, upon the request of and in consultation with the SEP, provide

Personnel to Telkom for the purposes of Clause 3 above. Such Personnel

may be either US Personnel or Other Personnel and shall be removed and

replaced by SBCI-MSI upon the request of the SEP from time to time;

provided that SBCI-MSI shall be entitled to provide Personnel hereunder who

are not employed by SBCI-MSI or any of its Affiliates at the time that SBCI-

Page 											18

MSI proposes to provide such Personnel to Telkom, only with the prior written

consent of TMA, such consent not to be unreasonably withheld.

4. 2

TMS

         shall, upon the request of and in consultation with the SEP, provide

Personnel to Telkom for purposes of Clause 3 above. Such Personnel may

be either Malaysian Personnel or Other Personnel and shall be removed and

replaced by TMS upon the request of the SEP from time to time; provided

that TMS shall be entitled to provide Personnel hereunder which are not

employed by TMS or any of its Affiliates at the time that TMS proposes to

provide such Personnel to Telkom, only with the prior written consent of

SBCISA, such consent not to be unreasonably withheld.

4. 3

The Parties hereby acknowledge that neither SBCI-MSI nor TMS shall

provide Personnel to Telkom except at the request of, and in consultation

with, the SEP in accordance with Clauses 4. 1 and 4. 2 above, as applicable.

5.

ADDITIONAL CONTRIBUTION

In the event that, during the term of this Agreement, the members of the SEP or any

of their respective Affiliates sell, licence or otherwise generally make available

technology or intellectual property (e. g. patented software, technical information or

know how) to third parties, the SEP undertakes to use its reasonable endeavours to

cause such members or Affiliates, as applicable, to offer such technology or

intellectual property, as the case may be, to Telkom on terms and conditions which

are no less favourable than those upon which such members or Affiliates actually

provide such technology or intellectual property to any such third party.

6.

ST POSITIONS

Current incumbents

The Parties acknowledge that each one of the ST Positions has been since 1 May

2002, and still is, filled by an incumbent who has been duly appointed in accordance

Page 											19

with the requirements of the Original Shareholders' Agreement and where applicable

the Initial Strategic Services Agreement.

7. 	USM POSITIONS

7.1 	            Appointments to USM Class B Positions

The SEP shall be entitled to provide Personnel to Telkom to serve as SEP

Appointees for the USM Positions which are SEP Class B Positions and

Telkom shall be obliged to accept such Personnel in those positions in

accordance with the following provisions:

7. 1. 1

for Telkom's financial year ending 31 March 2003, the SEP may provide

a maximum of 15 (fifteen) persons at any one time to be appointed by

Telkom as SEP Appointees for the USM Positions in question;

7.1.2

     for Telkom's financial year ending 31 March 2004, the SEP may provide

a maximum of 12 (twelve) persons at any one time (which shall include

persons already appointed in terms of Clause 7.1.1 above) to be

appointed by Telkom as SEP Appointees for the USM Positions in

question;

7.1.3

     for the period from 1 April 2004 until the expiration or termination of this

Agreement in accordance with Clause 17 below, the SEP may provide

a maximum of 3 (three) persons (which shall include persons already

appointed in terms of Clauses 7.1.1 and 7.1.2 above) at any one time to

be appointed by Telkom as SEP Appointees for the USM Positions in

question;

7.1.4

    each person so accepted by  Telkom as an SEP Appointee shall be

appointed for at least 18 (eighteen) months but not more than 36 (thirty-

six) months, to provide the Strategic Services on the same terms as

other Personnel provided by or for the SEP in terms of this Agreement;

Page 											22

8. 1. 2

For the purposes of Clause 8. 1. 1 above:

(a)

the Search Committee shall be an informal committee

comprising such persons as the CEO may appoint from time to

time, but shall always include at least the GE-HR and the COO

or their authorised delegates;

(b)

decisions of the Search Committee shall be determined by a

majority vote.

8. 2 	SEP Positions

8. 2. 1

Any vacancy in an SEP Position shall be filled in accordance with a two

part consultative process as follows:

(a)

first, if a suitably qualified Historically Disadvantaged Individual

is available for the position in question, the vacancy shall be

filled in accordance with the provisions of Clause 8. 1 above, as

if it were a Telkom Position, provided that the position shall

nonetheless continue to be regarded for all purposes until the

termination of this Agreement as an SEP Position; and

(b)

second, if a suitably qualified Historically Disadvantaged

Individual is not available within 60 (sixty) days from the date

on which the vacancy occurs, the vacancy shall:

(i)

if it is for an ST Position, be filled in accordance with the

provisions of Clause 8. 2. 3 below; or

(ii)

if it is for a USM Position, be filled in accordance with

the provisions of Clause 8. 2. 6 below.

8. 2. 2

For the purposes of Clause 8. 2. 1 above a "vacancy" shall be regarded

as having occurred when the incumbent of the SEP Position actually

Page											 23

vacates that position by ceasing to render the services he was obliged

to render.

8.2.3

 For the purposes of Clause 8.2.1(b)(i)  above,  where  the  vacancy  to be

filled is for an ST Position, it shall be filled in accordance with the

provisions of this Agreement, only after the following further consultative

process has been followed:

(a)

after the SEP has selected a candidate for the position in

question, in accordance with the provisions of this Agreement,

it shall nominate the candidate for approval by the CEO and the

GE-HR, by giving written notice ("the nomination notice") of its

nomination to the CEO on Telkom's behalf, together with the

candidate's employment credentials;

(b)

on receipt of the nomination notice, the CEO may call for such

further information about the candidate so nominated (the

"nominee") as he may reasonably require, and also for an

interview either in person or by telephone, by any one or more

of himself, the GE-HR and the chairman for the time being of

the HRRC;

(c)

if the nominee is approved by the CEO and the GE-HR, the

nominee shall be appointed to fill the ST Position in question;

(d)

if the nominee is not acceptable to the CEO and the GE-HR

and is rejected by them, they shall within 10 (ten) days from the

date the CEO receives the nomination notice, notify the SEP in

writing to that effect, ("the rejection notice") and such notice

shall include the reasons for the rejection;

(e)

upon receipt of any rejection notice in terms of Clause 8.2.3(d)

above, the SEP may either refer the appointment of its

nominee to the HRRC for determination or propose another

nominee for the ST Position in question;

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(f)

if the SEP refers the appointment of its nominee to the HRRC

for determination then a decision of the majority of the

members of the HRRC shall be final and binding on the Parties;

(g)

if the SEP proposes another nominee then the procedures set

out in this Clause 8. 2. 3 shall apply and be followed all over

again, mutatis mutandis.

8. 2. 4

If the appointments of 2 (two) different candidates nominated by the

SEP for a particular ST Position are referred to the HRRC for

determination in terms of Clause 8. 2. 3(f) and both are rejected by the

HRRC, then Telkom shall be obliged to appoint to the ST Position in

question a 3rd (third) candidate selected by the SEP in its sole

discretion.

8. 2. 5

If the consultative process referred to in Clause 8. 2. 3 in respect of any

candidate nominated by the SEP for a particular ST Position is not

completed within 30 (thirty) days from the date on which the nomination

notice is given to the CEO in terms of Clause 8. 2. 3(a), then such

candidate shall be deemed to have been approved in terms of Clause

8. 2. 3(c) and Telkom shall be obliged to appoint such candidate to the

ST Position in question. The provisions of this Clause 8. 2. 5 shall not

however apply where the delay is caused by any act or omission of the

SEP.

8. 2. 6

For the purposes of Clause 8. 2. 1 (b)(ii) above, where the SEP Position

to be filled is for a USM Position, it shall be filled in accordance with the

provisions of this Agreement, but only after following the same further

consultative process as that prescribed in Clauses 8. 2. 3, 8. 2. 4 and

8. 2. 5 above, the provisions of which shall accordingly apply mutatis

mutandis, except that the SEP's nominee shall be subject to the

approval of the CEO, GE-HR and the executive to whom the nominee, if

appointed, would have to report in terms of the Management Structure,

Page 											26

9. 2

The SEP shall in any event continue to be entitled under Clause 3. 3 above to

remove any SEP Appointees with or without cause from time to time in its

discretion.

9. 3

Any vacancy in an SEP Position which results from a removal of an SEP

Appointee in terms of Clause 9. 1 or Clause 9. 2 above shall be filled in

accordance with the applicable provisions of Clause 8 above.

10. 	TRANSFORMATION

10. 1

Any incumbent of an SEP Position who is not an Historically Disadvantaged

Individual may by agreement between Telkom and the SEP be replaced at

any time during the term of this Agreement by a suitably qualified Historically

Disadvantaged Individual, after following the procedure referred to in Clause

8.1 above for filling a vacancy in a Telkom Position, as if the replacement

were a nominee for a Telkom Position.

10. 2

In any event, if the CEO on behalf of Telkom is of the opinion that the

incumbent of any SEP Position can and should be replaced by an Historically

Disadvantaged Individual, he may seek such replacement without the

agreement of the SEP by referring the matter to the HRRC for determination.

Any determination by the HRRC of any such matter referred to it by the CEO

shall be final and binding on the Parties, provided that the determination is

made unanimously by all the members present at a meeting of the HRRC,

including in attendance at least 1 (one) member of that committee appointed

by the SEP.

10. 3

The Parties record, for the avoidance of any doubt, that if any incumbent of

an SEP Position has at the Commencement Date been replaced by an

Historically Disadvantaged Individual or is after the Commencement Date

replaced by an Historically Disadvantaged Individual pursuant to the

provisions of Clauses 10. 1 or 10. 2 above, the position which is or will then be

held by that Historically Disadvantaged Individual shall not be regarded as an

Page 											27

SEP Position and the provisions of Clause 3. 9 above shall apply to that

position, mutatis mutandis.

10. 4

Notwithstanding anything to the contrary contained elsewhere in this

Agreement, the provisions of this Clause 10 shall not apply to an incumbent

of any of the SEP Positions referred to in Clause 8. 3. 1.

11. 	COSTS AND CHARGES

11. 1

Subject to other applicable provisions of this Clause 11, Telkom shall pay a

fee to each person that directly provides Personnel to Telkom (i. e. the SEP or

a Personnel Provider and including, if applicable and without limitation, SBCI-

MSI or TMS) with respect to such Personnel as follows:

11. 1. 1

with respect to any Long-Term Personnel provided to Telkom to provide

Strategic Services, the amount per annum (payable monthly) set forth in

Appendix 3 attached hereto, pro rated for any partial year of this

Agreement in which such Personnel are provided to Telkom; and

11. 1. 2

with respect to any Short-Term Personnel provided to Telkom to

provide Strategic Services, an amount per month during each year of

the term of this Agreement set forth in Appendix 4 attached hereto, pro

rated for any partial month in which such Personnel are provided to

Telkom.

11. 2

Each person that directly provides Personnel to Telkom (i. e. the SEP or a

Personnel Provider and including, if applicable and without limitation, SBCI-

MSI or TMS) shall submit to Telkom monthly invoices in Dollars for all fees

payable hereunder by Telkom including fees for services provided by the

Personnel to Telkom in the immediately preceding month. Such invoices

shall set forth the Personnel provided to Telkom by such Personnel Provider

who provided Strategic Services during the period elapsed under each

invoice. Telkom shall, within 30 (thirty) days from the date of such invoices,

pay such monthly invoices in full as herein provided. In the event that Telkom

Page											 28

fails to pay any amounts due under this Agreement within such 30 (thirty) day

period and in the manner herein provided, any such unpaid amounts shall

bear interest at the rate of 15% (fifteen percent) per annum, from the date of

expiration of such 30 (thirty) day period to the date Telkom pays such

amounts to the SEP or such Personnel Provider.

11. 3

All amounts payable hereunder by Telkom to the SEP or any Personnel

Provider (including, if applicable, SBCI-MSI and TMS) shall be paid in Dollars

in New York, New York by wire transfer of immediately available funds to the

respective accounts specified from time to time by the SEP or the applicable

Personnel Provider. Such payments shall be made free from any set-off,

withholding or deduction which, if payable in connection with any payments

due or made hereunder shall be borne and paid by Telkom and such

payments will be increased by any value-added tax for which the SEP or any

Personnel Provider, as applicable, shall be liable in respect of such

payments. In the event that Telkom is required by any law or regulation to

make any deduction or withholding (on account of tax or otherwise) from any

payment to be made under this Agreement, then Telkom shall, together with

such payment, pay such additional amount as to ensure that the SEP and

each Personnel Provider receives (free and clear of any tax or other

deductions or withholdings) the full amount which it would have received if no

such deduction or withholding had been required.

12. 	ADDITIONAL OBLIGATIONS

12. 1

Telkom agrees to discharge promptly all costs and obligations payable or to

be performed by it in respect of the Strategic Services and will provide the

Personnel with such assistance and access to its facilities, operations and

staff as Telkom would ordinarily provide employees employed by Telkom in

positions which are equal to (or substantially equal to) positions for which

such Personnel have been provided to Telkom in terms of seniority and

responsibility. Telkom further agrees to provide the SEP and each Personnel

Provider with such assistance as the SEP and each Personnel Provider may

Page 											29

reasonably request to enable the SEP and each such Personnel Provider to

obtain and maintain any Permit.

12. 2

The Parties agree that, upon the request of either Telkom or the SEP, but not

more than once in any quarter, the CEO, COO, CSO and GE-HR shall meet

and, in good faith, review the performance of the Personnel and consider

whether and the extent to which the SEP should provide (or arrange for the

provision of) additional Personnel to Telkom.

13. 	MANAGEMENT STRUCTURE

13. 1

The Management Structure (including reporting lines for the most senior

members of management, including the SEP Positions) is set forth in

Appendix 1. The SEP shall be entitled to provide Personnel for the SEP

Positions (being the SEP Class B Positions, the SEP Class B* Positions and

the SEP Class C positions) and Telkom shall be obliged to appoint such

Personnel pursuant to the terms of this Agreement.

13. 2

The SEP and Telkom agree that, in accordance with the procedures set forth

in this Clause 13, modification to the number of SEP Positions may be

permitted to reflect changing market conditions, employee expertise levels,

SEP ownership levels, and such other factors that Telkom and the SEP agree

to be relevant. Further, the Parties agree:

13. 2. 1

The SEP may relinquish an SEP Position to which it is entitled under

the Management Structure at any time, provided that in such

circumstances, the SEP shall be consulted with regard to each

replacement for such position appointed by Telkom at any time during a

period of 1 (one) year from the date on which the SEP Position was so

relinquished and Telkom shall give due consideration to the SEP's

views with regard to each replacement. The SEP shall provide Telkom

with official notice in accordance with Clause 20 below to confirm the

SEP's relinquishment of its right to provide Personnel for such position

under the Management Structure.

Page 											30

13. 2. 2

Telkom may relinquish a Telkom Position under the Management

Structure at any time, provided that in such circumstances Telkom shall

be consulted with regard to each replacement for such position

appointed by the SEP at any time during a period of 1 (one) year from

the date on which the Telkom Position was so relinquished and the

SEP shall give due consideration to Telkom's views with regard to each

replacement. Telkom shall provide the SEP with notice in accordance

with Clause 20 below to confirm Telkom's relinquishment of its right to

make appointments to such position under the Management Structure.

13. 3

The extent of the authority of the members of Telkom's senior management

including the SEP Appointees is set forth in the Schedule of Authorisations

attached hereto as Appendix 2.

13. 4

Each member of Telkom's management shall have the authority to appoint,

dismiss and replace personnel subordinate to such member other than

Personnel appointed by the SEP, provided that Personnel appointed by the

SEP shall not have the authority to appoint, dismiss and replace Telkom

personnel other than Personnel appointed by the SEP subordinate to such

Personnel appointed by the SEP without prior consultation with and the

approval of the CEO.

14.	SETTLEMENT OF DISPUTES

14. 1

The Parties shall in good faith attempt to resolve any dispute, controversy or

claim between or among any of them arising out of or relating to this

Agreement or the breach, termination or invalidity thereof (hereafter, a

'dispute') amicably. Any dispute which they have been unable to resolve by

mutual agreement shall be submitted to binding arbitration as provided below,

at the written request of any Party in accordance with the provisions of

Clause 20 of this Agreement.

Page											 31

14. 2

Any dispute which cannot be resolved amicably shall be exclusively and

finally resolved by arbitration conducted in accordance with the UNCITRAL

Arbitration Rules (the 'Rules') as at present in force (except as modified

below); provided that such arbitration may not be commenced unless the

Parties to the dispute otherwise agree, until the 31st (thirty-first) day after the

written request referred to in Clause 14. 1 has been received by the other

Party or Parties to such dispute. The Appointing Authority under the Rules

shall be the Secretary General for the time being of the International

Chamber of Commerce (the 'ICC') International Court of Arbitration.

14. 3

There shall be 3 (three) arbitrators. The claimant(s), irrespective of number,

shall appoint jointly one arbitrator, the respondent(s) irrespective of their

number, shall appoint jointly the second arbitrator, and a third arbitrator, who

shall serve as presiding arbitrator, shall be appointed as provided in the

Rules. In the event that any respondent or joint respondents shall fail to

appoint an arbitrator, such arbitrator shall be appointed by the Appointing

Authority.

14. 4

A sole respondent may join a Party other than the claimant in the arbitration

within 15 (fifteen) days after receipt by the respondent of notification from the

claimant of the appointment of an arbitrator, provided that the right to relief by

the respondent against such joined Party depends on the determination of

substantially the same question of law or fact which, if separate actions were

instituted, would arise on each action. In the event of such joinder, the

arbitrator to be appointed by the respondent pursuant to Clause 14. 3 above

shall be appointed jointly by the respondent and the joined party, and if they

fail to so jointly appoint, such arbitrator shall be appointed by the Appointing

Authority. Once the arbitration panel is constituted, upon the request of the

claimant, the panel shall render a decision as to whether such joinder was

appropriate based on the terms of this Clause 14. 4, and if the arbitral panel

determines that such joinder was not appropriate then it shall sever the joined

claim from the pending arbitration.

14. 5

The place of arbitration shall be Gauteng Province, South Africa and the

award shall be deemed rendered in South Africa. The arbitrators may

Page 											32

conduct proceedings or portions of proceedings at venues they deem

convenient. The language of the arbitration shall be English. The aforegoing

notwithstanding, the place of arbitration for disputes between or among the

SEP, SBCISA, TMS and/or any other Personnel Provider shall be London,

England.

14. 6

The arbitrators shall be able to read, write and converse fluently in English.

The presiding arbitrator shall not be a national of any country in which any

Party or ultimate parent of such Party is domiciled.

14. 7

In addition to the powers expressly provided in the Rules, the arbitrators shall

have the power to:

14. 7. 1

investigate any matter, fact or thing which they consider necessary or

desirable in connection with the dispute submitted to the arbitral panel

and, for that purpose, shall have the widest powers of investigating all

the books, records, documents and other materials in the possession of

the Parties or under their control, and the right to make or have made

copies thereof and/or take extracts therefrom and the right to have such

documents or copies thereof produced and/or delivered at any place

reasonably requested by the arbitrators for the aforesaid purposes;

14. 7. 2		       inspect goods and property of the Parties;

14. 7. 3

question the Parties under oath (including their officers, directors and

employees);

14. 7. 4

summon witnesses to appear at the hearing before the arbitral panel;

and

14. 7. 5

record evidence.

The arbitrators shall hold hearings and render their award as soon as

practicable.

Page											 33

14. 8

In connection with any arbitral proceeding commenced under this Clause 14,

each Party shall have the power to:

14. 8. 1

request and inspect documents and other materials in the possession

of any Party or under their control, make or have made copies thereof

and/or take extracts therefrom and have such documents or copies

thereof produced and/or delivered at any place reasonably requested

by such Party for the aforesaid purposes;

14. 8. 2

present oral evidence at any hearing conducted before the arbitral

panel;

14. 8. 3

interview witnesses to appear at any hearing conducted before the

arbitral panel;

14. 8. 4

cross-examine witnesses summoned by the other Party at any hearing

conducted before the arbitral panel; and

14. 8. 5                submit other evidence to the arbitral panel as such panel may permit.

14. 9

In rendering their decision, the arbitrators shall be bound by this Agreement

and shall interpret this Agreement under the laws of South Africa. In addition

to the aforegoing, the arbitrators are empowered to act ex acquo et bono in

the event that the laws or regulations of South Africa would cause an unfair

result. The arbitrators' decision shall be reasoned and shall be rendered in

writing, shall be final and binding upon the Parties and shall be carried into

effect and may be enforced and confirmed as a judgment or an order of any

competent court at the instance of either Party.

14. 10

In any arbitration proceedings under this Clause 14, the arbitrators shall be

empowered to award monetary damages (but excluding any damages which

in the circumstances would be special damages) to the extent permitted by

South African law. If one or more Parties prevails on all or substantially all of

the claims of any arbitration proceedings under this Clause 14, the other

Party or Parties not prevailing shall pay all fees and expenses of the

Page 											34

arbitrators, the ICC and of such prevailing Party or Parties, including such

Party's or Parties' reasonable attorneys' fees. Any monetary award made

hereunder shall be made in Dollars and payable free of any tax or other

deduction, and shall include:

14. 10. 1

interest from the date of any breach or other violation of this Agreement

to the date on which such award is paid at a fair rate determined by the

arbitrators; and

14. 10. 2

any additional amounts necessary to compensate the Party or Parties

to whom such award is made pursuant to this Clause 14 for any taxes

imposed on such Party or Parties or its or their owners with respect to

such amount (except for income taxes payable with respect to any such

award that is paid to satisfy a claim for amounts which, if paid as and

when due as claimed, would have constituted taxable income to such

Party or Parties).

14. 11

In any arbitration proceeding under this Clause 14, the arbitrators shall be

authorised to order specific performance of any obligations arising under this

Agreement.

14. 12

This Clause 14 shall not preclude any Party from obtaining relief by way of

motion proceedings on an urgent basis or from instituting any interdict,

injunction or any similar proceedings in any court of competent jurisdiction in

order to preserve the subject matter to the arbitration or the availability of

effective relief pending the decisions of the arbitrators. Notwithstanding

anything contained in the Rules to the contrary, the Parties shall not be

restricted from making any disclosures required by law or enforceable legal

process, or by the rules of any securities exchange or regulatory authority

having jurisdiction over any such Party.

14. 13

In any arbitration proceedings under this Clause 14, the Parties shall remain

bound by the provisions of Clause 18 of this Agreement.

Page 											35

15. 	REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS

15. 1

On the date hereof, each of the SEP and Telkom represents and warrants to

the other that:

15. 1. 1

it is a company duly incorporated or otherwise formed with limited

liability and validly existing in good standing under the jurisdiction in

which it is formed and has full power, authority and legal right to own its

property and assets and to carry on its business subject to the terms of

any licence required to be held by it to carry on such business;

15. 1. 2

it has full power, authority and legal right to enter into this Agreement

and to engage in the transactions contemplated hereby and has taken

or obtained all necessary corporate and other action to authorise the

execution and performance of this Agreement;

15. 1. 3

this Agreement constitutes the legal, valid and binding obligation of that

Party and is enforceable in accordance with its terms;

15. 1. 4

neither the execution of this Agreement nor the performance by the

Party of any of its obligations or the exercise of any of its rights

hereunder will conflict with or result in a breach of any treaty, law,

regulation, judgment, court order, authorisation or agreement or

obligation applicable to that Party or cause any limitation placed on that

Party or on the powers of that Party's directors to be exceeded;

15. 1. 5

all authorisations legally required from any governmental or other

authority or from the shareholders or creditors of that Party for or in

accordance with the execution, validity and performance of this

Agreement, other than Permits related to the provision of Personnel,

have been obtained and are in full force and effect;

15. 1. 6

that Party is not in default under any treaty, law, regulation, judgment,

court order, authorisation or agreement or obligation applicable to it or

its assets or revenues, the consequences of which default could

Page 											36

materially or adversely affect its ability to perform its obligations under

this Agreement;

15. 1. 7

no litigation, arbitration or administrative proceeding is currently taking

place or pending or, to the knowledge of that Party, threatened against

that Party or its assets which proceeding could materially and adversely

affect the ability to perform its obligations under this Agreement;

15. 1. 8

that Party is generally subject to civil and commercial law and to legal

proceedings and neither that Party nor any of that Party's assets or

revenues is entitled to any immunity or privilege (sovereign or

otherwise) from any set-off, judgment, execution, attachment or other

legal process.

15. 2  	The SEP represents, warrants and undertakes that:

15. 2. 1

it has or will have the capacity, and is or will be in a position to provide,

the Strategic Services to Telkom (or it is or will be in a position to cause

one or more suitably qualified Personnel Providers with adequate

capacity to provide the Strategic Services to Telkom);

15. 2. 2

it has or will have (or such Personnel Providers have or will have) the

technical resources to provide the Strategic Services to Telkom;

15. 2. 3

it has or will have (or such Personnel Providers have or will have)

available to them persons with the requisite skills, qualifications and

experience to meet the SEP's obligations under this Agreement; and

15. 2. 4

during the term of this Agreement the facts warranted above will

continue to be correct;

15. 2. 5

the carrying out of its obligations pursuant to this Agreement will not

conflict with or constitute a breach of, or default under, any contract or

agreement or arrangement to which it is a party or by which it may be

bound, nor will any such action result in any violation of any treaty, law,

Page											 37

judgment or court order save where absence of such title or conflict

with, breach or default under any contract, agreement or arrangement

or violation of any treaty, law, judgment or court order would not in any

such case materially or adversely affect the ability of the SEP to

perform its obligations under this Agreement;

15. 2. 6

the Strategic Services will be provided with reasonable care and skill

and in a manner that is consistent with good industry practice.

15. 3

Each Party undertakes that such Party shall use its reasonable endeavours to

comply with and cause its Affiliates to comply with all applicable laws of South

Africa, and Telkom and its Affiliates shall not at any time conduct any

business or take any act which would cause the SEP, its owners, any

Personnel Providers or any of their Affiliates to be in violation of such laws.

Also, the SEP, SBCI-MSI and TMS shall (and the SEP shall cause each other

Personnel Provider to) comply with all laws, rules and regulations applicable

to them in connection with the provision of Personnel. In addition to the

aforegoing, Telkom acknowledges that SBCISA, SBCI, SBCI-MSI and their

Affiliates are subject to the United States Communications Act of 1934, as

amended by the United States Telecommunications Act of 1996, and as

amended from time to time (collectively referred to as "the US Act"), and

Telkom shall not and Telkom shall cause its Subsidiaries not to take any

action which would cause SBCISA, SBCI, SBCI-MSI or any of their Affiliates

to be deemed to be engaged in the provision of:

15. 3. 1

long-distance telecommunications services (in those States where

SBCISA, SBCI, SBCI-MSI or any of their Affiliates have not received

authority in terms of Section 271 of the US Act); or

15. 3. 2

any other services which, in the opinion of SBCISA are prohibited by

the US Act in the "In-Region" States as defined in Section 271(i)(1) of

the US Act. The Parties acknowledge that on the Signature Date the

"In-Region" States of the United States of America applicable to

SBCISA, SBCI, SBCI-MSI and their Affiliates currently include the

Page											 38

States of California, Illinois, Indiana, Michigan, Nevada, Ohio and

Wisconsin.

16. 	INDEMNIFICATION

16.1

None of the SEP, the Personnel or any Personnel Provider, any of their

Affiliates, officers, directors, and each of their respective assignees,

subcontractors, directors, officers, shareholders, employees or agents shall

be liable to Telkom or any of its Affiliates for any claim, loss, damage or

expense whatsoever sustained or incurred by Telkom or its Affiliates as a

result of the actions or the failure to act of the SEP, the Personnel or such

Personnel Provider, provided that the SEP shall fully indemnify and hold

Telkom or any of its Affiliates, officers, directors and each of their respective

assignees, subcontractors, directors, officers, shareholders, employees or

agents harmless from and against any claims, damages or liabilities actual or

alleged, costs and expenses, including attorneys' fees and expenses

(including investigative costs) arising directly from the wilful misconduct of the

Personnel in connection with the provision of the Strategic Services to

Telkom, in accordance with the terms of this Agreement Notwithstanding

anything contained herein to the contrary, none of the SEP, the Personnel or

any Personnel Provider or any Affiliate thereof shall have any liability to

Telkom or its Affiliates whatsoever for any indirect losses, consequential or

incidental damages, including, without limitation, loss of profits or goodwill,

sustained or claimed by any person, firm, company or organisation

whatsoever and howsoever arising, including, without limitation, as a result of

the performance or non-performance hereunder by the SEP, the Personnel or

any Personnel Provider

16.2

Telkom shall fully indemnify and hold the SEP, the Personnel, any Personnel

Provider and their Affiliates and each of their respective assignees,

subcontractors, directors, officers, shareholders, employees and agents,

harmless from and against any claims, damages or liabilities, actual or

alleged, costs and expenses, including attorneys' fees and expenses

(including investigative costs) arising directly from Telkom's acts related to

Page 											39

this Agreement, except to the extent caused by the wilful misconduct of the

SEP, the Personnel or the Personnel Provider, as the case may be.

16. 3

Telkom shall fully indemnify and hold the Personnel harmless from and

against any claims, damages or liabilities, actual or alleged, costs and

expenses including attorneys' fees and expenses, (including investigative

costs) arising from acts of the Personnel to the same extent that Telkom

would ordinarily indemnify its officers, directors, representatives and/or

employees, as the case may be.

16. 4

Telkom shall maintain officer and director insurance with respect to the

Personnel as Telkom ordinarily maintains with respect to the officers and

directors of Telkom generally.

17. 	TERMINATION

17. 1

This Agreement shall commence on the Commencement Date and shall

continue in force until terminated pursuant to this Clause 17.

17. 2

This Agreement shall automatically terminate upon the occurrence of any of

the following:

17. 2. 1 	      		mutual Agreement by the Parties; or

17. 2. 2 	              		the liquidation or dissolution of either of Telkom or of the SEP.

17. 3

This Agreement shall automatically terminate upon the earlier of (i) 10 (ten)

days after SEP ceases to be a Significant Shareholder; provided that, at the

written request of Telkom, this Agreement shall continue in effect for a period

up to 120 (one hundred and twenty) days or such shorter period as agreed

with the SEP, notwithstanding that the SEP ceases to be a Significant

Shareholder and (ii) the later of (x) the third anniversary of the Initial Public

Offering by Telkom and (y) 8 May 2007.

Page 											40

17. 4

This Agreement shall terminate, at the option of the SEP, upon the

occurrence of any of the following:

17. 4. 1

the failure of Telkom to pay, in the manner herein provided, any

payment due hereunder within 30 (thirty) days after receipt of notice of

such failure;

17. 4. 2

the failure of Telkom to comply with its obligations under Clause 12. 1

above;

17. 4. 3

at any time Exchange Control Approvals terminate or lapse or are

revoked and are not renewed or reinstituted;

17. 4. 4

the Restated Shareholders' Agreement terminates for any reason or the

Minister (as therein defined) commits a breach of any of the material

terms thereof;

17. 4. 5

the consent rights, Board and committee representation rights or any

other rights granted to the SEP under the Restated Shareholders'

Agreement or Telkom's Memorandum and Articles of Association are

deemed or become unenforceable for any reason; or

17. 4. 6

Telkom ceases to be a significant provider of telecommunications

services for any reason whatsoever.

17. 5

In addition, this Agreement may be terminated by SBCI-MSI or TMS (with

respect to themselves only) by written notice to the other Parties as follows:

17. 5. 1

SBCI-MSI may terminate this Agreement with respect to itself, and TMS

may terminate this Agreement with respect to itself, in the event that the

terminating Party (SBCI-MSI or TMS, as applicable) declares

bankruptcy or seeks legal protection from its creditors;

17. 5. 2

SBCI-MSI may terminate this Agreement with respect to itself if none of

SBCISA or any of its Affiliates owns an equity interest in the SEP; and

Page 											41

17. 5. 3

TMS may terminate this Agreement with respect to itself if none of TMA

or any of its Affiliates owns any equity interest in the SEP.

Notwithstanding any provision contained herein to the contrary, a termination

by either SBCI-MSI or TMS pursuant to this Clause 17. 5 (as applicable, the

'Terminating Party') shall be effective only with respect to the Terminating

Party and shall have no effect on the rights, obligations, or duties of any other

Party hereto (all of which rights, obligations and duties shall continue in full

force and effect).

17. 6

If this Agreement terminates pursuant to Clauses 17. 1, 17. 2, 17. 3 or 17. 4

hereof (or with respect to a Terminating Party pursuant to Clause 17. 5

hereof), all further obligations of the Parties hereto (or of such Terminating

Party, as applicable) shall terminate and no damages or other compensation

shall be payable by any Party (or by such Terminating Party, as applicable)

except that nothing in this Clause 17. 6 shall relieve any Party (or by such

Terminating Party, as applicable) hereto of any liability for any breach of this

Agreement that occurred prior to termination or release of any Party (or such

Terminating Party, as applicable) from the continued application of any

provisions of this Agreement expressed to be applicable after termination.

18. 	CONFIDENTIALITY

18. 1

The Parties recognise that any and all information, know-how and

management material and expertise (collectively, 'Confidential Information')

disclosed by any Party or any Personnel Provider or any of their respective

employees, agents or other representatives under this Agreement or the

Initial Strategic Services Agreement, or in connection with the provision of

Strategic Services (whether directly or indirectly) is the exclusive property of

such Party or Personnel Provider, as applicable. Subject to Clause 5, each of

the Parties (the 'recipient') agrees in relation to the Confidential Information of

any party (the 'owner'):

Page 											42

18. 1. 1

to use the Confidential Information of any owner solely for the purposes

contemplated by this Agreement and as necessary in connection with

the business and affairs of Telkom;

18. 1. 2

to keep such information confidential and to disclose it only to their or

their Affiliates' officers, directors, employees, representatives,

consultants and professional advisers or such other persons who have

a need to know such information in connection with the business or

affairs of Telkom or the recipient or their respective Affiliates, who are

aware of the recipient's obligations of confidentiality hereunder with

respect to such information and have agreed to comply with such

obligations (it being understood that any recipient which discloses any

Confidential Information to any other person shall be responsible for

any further use or disclosure of such information in breach of the

restrictions contained herein);

18. 1. 3

at any time requested by an owner in writing, and upon termination of

this Agreement, promptly deliver (or cause to be delivered) to the owner

or, if requested by the owner, destroy (or cause to be destroyed) in

either case without retaining any copies thereof, all of the owner's

Confidential Information in the possession or control of the recipient or

its Affiliates or their respective officers, directors, employees,

representatives, consultants and professional advisers. This

Clause 18. 1. 3 is applicable to all documentation and other materials

(including magnetic and optical storage media) and all copies thereof

containing or embodying Confidential Information, including

documentation and materials such as specifications, manuals, training

material, written instructions, schedules and plans.

18. 2

The aforegoing notwithstanding, no recipient shall be obligated to treat

information as Confidential Information of an owner under this Agreement if:

18. 2. 1

such information enters the public domain other than in breach of this

Clause 18 or any other obligation of confidentiality owed to the owner

thereof;

Page 											43

18. 2. 2

such information was lawfully received by the recipient from a third

party who, to the knowledge of such recipient at the time of disclosure,

was not subject to any duty of confidentiality, directly or indirectly, to the

owner thereof;

18. 2. 3

such information was expressly in the files of, or known to, the recipient

(or its officers, directors, employees, representatives, consultants and

professional advisers) provided that knowledge thereof was not

obtained, to the knowledge of such recipient, as a result of a disclosure

by a third party in violation of any duty of confidentiality, directly or

indirectly, to the owner thereof; or

18. 2. 4

such information is independently developed by the recipient (or its

officers, directors, employees, representatives, consultants or

professional advisers) or on their behalf without the use of Confidential

Information of the owner thereof.

18. 3

No Party hereto shall be restricted in disclosing any Confidential Information

of any owner if and then only to the extent that such disclosure is required by

law or enforceable legal process, or by the rules of any securities exchange

or regulatory authority having jurisdiction over such party, provided the party

required to make such disclosure:

18. 3. 1

provides the owner of such Confidential Information notice of such

requirement as soon as practicable after the party obligated to make

such disclosure learns of such requirement, and thereafter consults with

the owner thereof before making any disclosure of such information;

and

18. 3. 2

takes all reasonable steps (including steps reasonably requested by the

owner thereof and any Party which is an Affiliate of such owner) to

oppose or prevent the disclosure, to limit, to the maximum extent

reasonably possible, the scope of such disclosure and to obtain

confidential treatment by the recipient of such disclosure.

Page 											45

New Castle, Delaware 19720

U. S. A.

Attn: Mr Rick L Moore

Facsimile: +210 370-1195

Telephone: + 1 210 351-2578

with copies by facsimile, which shall not constitute notice and which if not sent

will not constitute a failure to send notice, to

Attn: Mr Wayne Watts

Facsimile: + 1 210 351-3257

Telephone: + 1 210 351 3476

and

Ms Wang Cheng Yong

Telekom Malaysia-Africa Sdn. Bhd.

Facsimile: + 60 3 2283 2415

Telephone: + 60 2020 2103

20. 3

To SBCI-MSI: For service of legal process purposes:

Corporation Trust Center

1209 Orange Street

Wilmington, Delaware 19801

U. S. A.

Facsimile: + 1 210 351-3257

Telephone: + 1 210 351-3476

Attention: Mr Wayne Watts

For all other purposes:

SBC International South Africa LLC

#117 Read's Way

Suite 222

Corporate Commons

New Castle, Delaware 1970

U. S. A.

Facsimile: + 1 210 370-1195

Telephone: + 1 210 351-2578

Attention: Mr Rick L. Moore

with a copy by facsimile, which does not constitute notice and which if not sent

will not constitute a failure to send notice, to:

Mr Wayne Watts

SBC International South Africa LLC

Facsimile: + 1 210 351-3257

Telephone: + 1 210 351-3476

Page 											48

24.

 WAIVER OF SOVEREIGN IMMUNITY

The Parties recognise and acknowledge that this Agreement and the transactions

contemplated by this Agreement constitute a commercial transaction. To the extent

that any Party (including the assignee of a Party's rights or obligations under this

Agreement) may be entitled, in any jurisdiction, to claim sovereign immunity or any

other immunity, as the case may be, from the jurisdiction of any court or arbitral

tribunal, or from any legal process, including but not limited to any order, attachment,

judgment or award, such Party hereby irrevocably agrees not to claim or assert, and

hereby irrevocably waives such sovereign or other immunity. The Parties intend the

aforegoing waiver of sovereign immunity to be no less broad than any waiver

permitted by the State Immunity Act of 1978 of Great Britain.

25.

 FORCE MAJEURE

None of the SEP, SBCI-MSI, TMS or any other Personnel Provider shall have any

liability for any failure or delay in complying with any provision of this Agreement if,

and to the extent and for so long as, that compliance is prevented or substantially

hindered by any act of God, government, flood, tempest, severe weather conditions,

war (whether declared or not), civil disturbances, revolution, riot, insurrection, other

natural disasters, act of terrorism, sabotage, strike, failure to acquire any Permit,

labour dispute, other public emergencies or any other cause whatsoever which is

substantially beyond the control of the SEP, SBCI-MSI, TMS or any other Personnel

Provider, as applicable.

26.

 COUNTERPARTS

This Agreement may be executed in one or more counterparts and in separate

counterparts, each of which shall be deemed an original but all of which together shall

constitute one and the same legal document.

Refer to accompanying PDF for Management structure diagram

Page											 53

APPENDIX 2

SCHEDULE OF AUTHORISATIONS

Page 											54

APPENDIX 2

Schedule of Authorisations

(which was amended by the Board on 12 August 1997 in accordance with the attached

resolution passed by the Board on that date)

Subject to the Articles and the rights of the Minister and the SEP with respect to Deserved

Matters, the senior managers of Telkom shall have the following authority with respect to all

matters other than those matters within the authority of the Operating Committee pursuant to

Clause 5.

1.

The CEO shall have authority to bind Telkom to transactions (or a series of

related transactions) consistent with the CEO's delegated management

responsibilities where the aggregate of payments and other consideration

given by the parties thereto will not exceed fifty million Rand (R50 000 000).

2.

The COO shall have authority to bind Telkom to transactions (or a series of

related transactions) consistent with the COO's delegated management

responsibilities where the aggregate of payments and other consideration

given by the parties thereto will not exceed thirty-five million Rand

(R35 000

 000).

3.

Each Group executive (other than the COO) shall have the authority to bind

Telkom to transactions (or a series of related transactions) consistent with their

respective delegated management responsibilities where the aggregate of

payments and other consideration given by the parties thereto will not exceed

ten million Rand (R10 000 000). The HRO shall have the authority, subject to

the approval of the HRRC and the Board, and in accordance with the then

current Annual Budget and the Business Plan, to conduct negotiations with

employee groups and union representatives including without limitation

collective bargaining agreements on behalf of Telkom.

4.

Each Managing Executive shall have authority to bind Telkom to transactions

(or a series of related transactions) consistent with their respective delegated

management responsibilities where the aggregate of payments and other

consideration given by the parties thereto will not exceed five million hand

(R5 000

 000).

5.

Each other Senior Manager shall have authority to bind Telkom to transactions

(or a series of related transactions) consistent with each such Senior

Manager's delegated management responsibility where the aggregate of

payments and other consideration given by the parties thereto will not exceed

two hundred fifty thousand stand (R250 000).

With respect to matters within the authority of the Operating Committee pursuant to Clause

5. 03, the senior managers of Telkom shall have only such authority as the Operating

Committee may from time to time delegate as a Reserved Matter.

TELKOM SA LIMITED

EXTRACT FROM MINUTES OF BOARD MEETING,

NO 5 OF 1997 HELD ON 12 AUGUST 1997

IN THE BOARD ROOM, 24TH FLOOR, TELKOM TOWER NORTH,

152 PROES STREET, PRETORIA

3. 6 	Schedule of Authorisations - proposed amendments

The following amendments as proposed by the Chief Financial Officer were

APPROVED by the meeting in accordance with clause 3. 02 of the

Shareholders Agreement as RECOMMENDED by the Operating Committee

in accordance with clause 5. 03 of the said agreement.

Approval Authority 			Management Level

Up to R50 million 				Chief Executive Officer

Up to R35 million 				Chief Operating Officer

Up to R20 million 				Group/Managing Executive

Up to R2 million 				Executive (E-level)

Up to R1 million 				Manager (D-level)

AUTHORISATION was also GRANTED to the Chief Financial Officer of the

Company to revise the authorities of all other levels based on the needs of

the Company and to finalise the Delegation of Authority, PROVIDED that

the amount of the approved authority which he may confer for any such

lower level shall not exceed R1 million.

CERTIFIED a true copy.

Pretoria

16 January 2003

VINCENT MASHALE

COMPANY SECRETARY

Page

APPENDIX 3

LONG-TERM PERSONNEL PAYMENT SCHEDULE

Year of

Agreement

Annual Rate COO Telkom,

CSO, CFO, CIO, CMSO

and CTO

(000)

US$

US

Personnel

1,

1,

1,

Malaysian

Personnel

Annual Rate per Group

and Managing Executive

(000)

US$

US

Personnel

Malaysian

Personnel

Annual Rate Per Senior

Manager

(000)

US$

US

Personnel

Malaysian

Personnel

 All amounts above are exclusive of "gross ups" for withholdings and

deductions and value added taxes.

For further years, the annual amounts shall be increased annually by 5%.

Page

APPENDIX 4

SHORT-TERM PERSONNEL PAYMENT SCHEDULE

Year of Agreement

Rate Per Month Per Senior Manager

US$

US Personnel

45, 020

46, 400

47, 800

49, 200

Malaysian Personnel

23, 356

24, 757

26, 242

27, 817

All amounts above are exclusive of "gross ups" for withholdings and

deductions and value added taxes.

For further years, the annual amounts shall be increased annually by 5%.

Page

APPENDIX 5

AGGREGATE ANNUAL PAYMENT SCHEDULE

Year of Agreement

and thereafter

Aggregate Annual Payment Amount

(000)

US$

52, 200

35, 800

36, 900

38, 745

All amounts above are exclusive of "gross ups" for withholdmgs and deductions and value

added taxes