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Manage and Maintenance Services – Draft

BUSINESS RELATIONSHIP AGREEMENT

entered into by and between

The City of Johannesburg

Physical Address 158 Loveday Street, Braamfontein

Fax No. Complete

Signed at Date

Draft – Not for Signature

Name who warrants that they are duly authorised to sign

Designation

and

("Contractor")

Description and Registration Number a private company registered in accordance with the laws of South Africa with registration number ………

Physical Address Complete

Signed at Date

Draft – Not for Signature

Name who warrants that they are duly authorised to sign

Designation

IN TERMS OF WHICH THE PARTIES AGREE AS FOLLOWS :

TABLE OF CONTENTS

1 DEFINITIONS ....................................................................................................................................................... 1

2 APPOINTMENT .................................................................................................................................................... 7

3 DURATION ........................................................................................................................................................... 7

4 NATURE OF RELATIONSHIP ............................ ................................................................................................. 7

5 SOCIO ECONOMIC DEVELOPMENT .................................................................................................................. 8

6 THE SERVICES .................................................................................................................................................... 9

7 VARIATION PROCEDURE ............................... ................................................................................................... 9

8 SERVICE LEVELS .................................... ........................................................................................................... 9

9 WITHHOLDING OF PERFORMANCE & SET-OFF............... ............................................................................. 10

10 REPORTS ........................................................................................................................................................... 10

11 CONTRACTOR’S STAFF ................................ ................................................................................................... 11

12 PROCESSES & PROCEDURES ........................................................................................................................ 11

13 CONSIDERATION .............................................................................................................................................. 12

14 DATA .............................................. .................................................................................................................... 12

15 USER SATISFACTION SURVEY .......................... ............................................................................................. 13

16 BENCHMARKING ...................................... ........................................................................................................ 14

17 GOVERNANCE STRUCTURES ......................................................................................................................... 14

18 CORRUPT ACTS................................................................................................................................................ 14

19 THE CONTRACTOR'S WARRANTIES ....................... ....................................................................................... 16

20 CONTRACTOR’S INDEMNITIES .......................... ............................................................................................. 18

21 LIMITATIONS ON LIABILITY .......................... ................................................................................................... 19

22 CONTRACT OWNER WARRANTIES ......................... ....................................................................................... 20

23 CONSENTS ........................................................................................................................................................ 20

24 OBLIGATIONS OF THE CONTRACTOR. .................... ...................................................................................... 20

25 OBLIGATIONS OF THE CITY ........................... ................................................................................................. 21

26 REVIEW OF THE AGREEMENT ........................................................................................................................ 21

27 INSPECTION ...................................................................................................................................................... 21

28 CONFIDENTIAL INFORMATION .......................... ............................................................................................. 22

29 INTELLECTUAL PROPERTY RIGHTS ...................... ........................................................................................ 24

30 DISPUTE RESOLUTION .................................................................................................................................... 26

31 BREACH & TERMINATION .............................. ................................................................................................. 27

32 TRANSFER MANAGEMENT UPON TERMINATION .............. .......................................................................... 27

33 FORCE MAJEURE ..................................... ........................................................................................................ 28

34 PERFORMANCE BOND .................................. .................................................................................................. 29

35 NOTICES AND DOMICILIUM ............................ ................................................................................................. 30

36 EXCLUSIVITY .................................................................................................................................................... 31

37 NO PARTNERSHIP ............................................................................................................................................ 31

38 ASSIGNMENT AND SUB CONTRACTING .................... ................................................................................... 31

39 INTERPRETATION ............................................................................................................................................. 32

40 GENERAL ........................................... ............................................................................................................... 34

SCHEDULES

Schedule 1 - Master Fleet Management Schedule 35

Schedule 2 - Service Level Schedule 2

Schedule 3 - Service Procedures 3

Schedule 4 - Variation Procedure 4

Schedule 5 - Dispute Resolution Procedure 6

Schedule 6 - Socio-Economic Development 9

Schedule 7 - Benchmarking Terms of Reference 10

Schedule 8 - Fuel Issues 11

Schedule 9 - Abuse Procedure 12

Schedule 10 - Contract Governance Structure 14

Schedule 11 - Fees and Billing 16

Schedule 12 - Form of Deed of Adherence 17

City of Joburg / Contractor

Manage & Mainentenance Draft

WHEREAS:

(A) This Agreement shall regulate the relationship between the Contract Owner and the Contractor

on the one hand and between the Contractor and the User Entities on the other hand,

pertaining to the provision of fleet management and maintenance services in respect of

particular vehicles to enable the efficient and optimal delivery of municipal services by the City

of Johannesburg and its User Entities to its citizens and ratepayers.

(B) The contract objectives have been aligned to the strategic objectives of the City and the Service

Level Schedule contained herein has taken into consideration the vision and value statements

of the City to become "a World-class African City".

(C) Accordingly, the City issued a Request For Proposals inviting proposals from the private sector

to undertake the provision of fleet management services to the City.

(D) Pursuant to a competitive tender process, the Contractor has been selected, based on its

responsiveness to the requirements of the bid, to provide the services contemplated in this

Agreement and the Contracting Parties wish to record the basis on which the Contractor will

provide the Services to the User Entities in writing.

(E) This Preamble is intended to outline the context within which this Agreement is being entered

into and shall not create substantive obligations on the Contracting Parties.

1 DEFINITIONS

In this Agreement the following expressions and words have the meanings assigned to them below

and derivative expressions and words will have the corresponding meaning:-

1.1 "Abuse " means any conscious act or omission attributable to a member of a User Entity's Staff

which causes physical damage to a Managed Vehicle and which arises out of the wilful or

grossly negligent misconduct of such member of Staff;

1.2 "Accessory " in relation to a Managed Vehicle, means any item of equipment that is additional

to the standard vehicle specifications by the vehicle’s manufacturer, which by its nature will not

require regular or significant maintenance during the term of this Agreement including but not

limited to, car radios, emergency lights, canopies, tow bars and other items with such

characteristics, but excluding Attachments;

1.3 "Ad Hoc Vehicle " means a vehicle provided by the Contractor on an ad hoc basis;

1.4 "AFSA" means the Arbitration Foundation of Southern Africa and its successors in title,

provided that should AFSA or a successor not be in existence at any time, any appointment

required to be made by AFSA shall be made by the Chairman of the Johannesburg Bar

Council;

1.5 "Agreement " means this Agreement, comprising:-

1.5.1 Part 1 - The Business Relationship Agreement; and

1.5.2 Part 2 - The Schedules;



together with amendments thereto, executed by the Contracting Parties in accordance with

Variation Procedure;

1.6 "Attachment " means an item of equipment (itself an assembly of parts), which is mechanically

attached or fixed to a Managed Vehicle and becomes a permanent structural part of the

Managed Vehicle, such that if the item were to be removed it would reconfigure the functional

dimensions of the Managed Vehicle to which it is attached;

1.7 "Authorised Driver " means a member of a User Entity's Staff declared to the Contractor in

writing who:-

1.7.1 is authorised to operate a Managed Vehicle;

1.7.2 possesses the required valid driving licence;

1.7.3 complies with the conditions of such driving licence; and

1.7.4 is not legally prohibited from operating the class of vehicle in question.

1.8 "Business Day " means any day in the RSA which is not a Saturday, Sunday or official public

holiday within the meaning of the Public Holidays Act, 1994. All references in this Agreement to

days shall be deemed to be to calendar days, unless specifically stipulated as being "Business

Days ";

1.9 "Business Hours " shall mean the hours from 07h00 to 18h00 on Business Days;

1.10 "Business Relationship Agreement " means the Part 1 of this Agreement;

1.11 "Category B Vehicle " means a City vehicle with an attachment which is mechanically affixed to

it and which reconfigures the vehicle to perform a particular function;

1.12 "Category C Vehicles " means a City vehicles with an attachment which is mechanically affixed

to it and which is reconfigured for waste management functions;

1.13 "Call Centre " means the facility established and/or operated by the Contractor for the purposes

of receiving and capturing service calls from the City;

1.14 "the City " means the City of Johannesburg Metropolitan Municipality;

1.15 "the City’s Data " means collectively:-

1.15.1 data provided by the City, any User Entity or any third party to the Contractor, or otherwise

received or collected by the Contractor, relating to the Contract Owner or the User Entities in

respect of this Agreement; and

1.15.2 data specific to the Services which the Contractor generates, processes, or supplies to the

User Entities in the performance of the Services;

1.16 "Consents " means all consents, permits, clearances, authorisations, approvals, rulings,

exemptions, registrations, filings, decisions, licences, required to be issued by or made with any

Responsible Authority in connection with the performance of any of the Services;



1.17 "Contract Owner " means the City acting in its capacity as the owner and prime contractor

under this Agreement, acting herein through Group Corporate and Shared Services. For

purposes of clarity, the City, as such, will act in two capacities under this Agreement, namely as

the Contract Owner and a User Entity;

1.18 "Client Service Executive " or "CSE" means the Contractor representative appointed as such

in terms of Schedule 10 (Contract Governance Structure) to fulfil the functions set out

therein;

1.19 "Contract Manager " means the Contract Manager of the Contract Owner, designated as such

in terms of Schedule 10 (Contract Governance Structure) ;

1.20 "Contract Year " means each successive 12 (twelve) month period during the term of this

Agreement, as measured from the Effective Date and each anniversary thereafter;

1.21 "Contracting Parties " means collectively the Contract Owner and the Contractor and the term

"Contracting Party " refers to either of them;

1.22 "Corrupt Act " means:

1.22.1 offering, giving or agreeing to give to the City or any other local, provincial or national

government or authority ("Public Body "), or to any person employed by or on behalf of the

City or any other Public Body any gift or consideration of any kind as an inducement or

reward:

1.22.1.1 for doing or not doing (or for having done or not having done) any act in relation to the

obtaining or performance of this Agreement or any other contract with the City or any

other Public Body; or

1.22.1.2 for showing or not showing favour or disfavour to any person in relation to this Agreement

or any other contract with the City or any other Public Body;

1.22.2 entering into this Agreement or any other contract with the City or any other Public Body in

connection with which commission has been paid or has been agreed to be paid by the

Contractor or on its behalf, or to its knowledge, unless before the relevant contract is entered

into, particulars of any such commission and of the terms and conditions of any such

contract for the payment of such commission have been disclosed in writing to the City;

1.22.3 committing any offence:

1.22.3.1 under any law from time to time dealing with bribery, corruption or extortion;

1.22.3.2 under any law creating offences in respect of fraudulent acts; or

1.22.3.3 at common law, in respect of fraudulent acts in relation to this Agreement or any other

contract with the City or any other Public Body; or

1.22.4 defrauding or attempting to defraud or conspiring to defraud the City or any other Public

Body;



1.23 "CPI" means the Consumer Price Index (historical metropolitan areas) published in the

Statistical Release P0141.1 compiled by Statistics South Africa, or, in the absence thereof, a

similar index nominated or prepared by an independent firm of auditors agreed between the

Contracting Parties, or, failing agreement, nominated by AFSA. The escalation factor used

shall be the latest available published year on year percentage change in the CPI at the

commencement of the month preceding the effective date of increase.

1.24 "Default " means the failure by a Service Party or Contracting Party to comply with its

obligations in terms of this Agreement or any negligent or wilful act or omission of the Party in

question or its Staff;

1.25 "Dispute Resolution Procedure " means the procedure contemplated in clause 30;

1.26 "Effective Date " means [��];

1.27 "Excluded Attachment " means any item of equipment recorded as such in terms of this

Agreement and which is owned by a User Entity and is not subject to any Services or Service

Levels;

1.28 "Expiry Date " means the date on which this Agreement expires due to the effluxion of time in

accordance with clause 3;

1.29 "Fleet Manager " or "FM" means a User Entity representative appointed as such in terms of

Schedule 10 – Contract Governance Structure , irrespective of what such person’s

organizational designation is;

1.30 "Good Industry Practice " means in relation to the manner in which the Services are rendered,

the standards, practices, methods and procedures conforming to applicable law, and exercising

that degree of skill, care, diligence, prudence and foresight that would reasonably and ordinarily

be expected from a skilled and experienced person engaged in a similar type of undertaking

under similar circumstances;

1.31 "Independent Expert " means an independent expert appointed by agreement between the

Contracting Parties to resolve a dispute between them in terms of this Agreement, provided

that:-

1.31.1 if the Contracting Parties are unable to agree on an independent expert within 5 (five) days

of either Contracting Party requiring one to be appointed, either Contracting Party may

thereafter require that same shall be appointed by AFSA;

1.31.2 such expert shall be deemed to act as an expert and not as an arbitrator;

1.31.3 the decision of such Independent Expert shall (in the absence of clerical or manifest error)

be final and binding on the Contracting Parties;

1.31.4 the Independent Expert’s fees for so acting shall be borne by the Contracting Parties in

equal shares unless the Independent Expert determines that the conduct of either

Contracting Party was such that it should bear a greater proportion or all of such fees; and



1.31.5 where AFSA is required in terms of this Agreement to appoint an independent third party, it

is the Contracting Parties' intention that such third party shall have the requisite skills,

experience and expertise necessary to determine the specific issue at hand, provided further

that AFSA’s appointee shall not be subject to dispute by either Contracting Party on the

grounds that it has failed to act in accordance with the intention expressed in this clause;

1.32 "Intellectual Property Rights " means patents, trademarks, service marks, design rights,

copyright (including all copyright in any designs and computer software), source codes, know-

how, logos, trade or business names and other similar rights or obligations of whatsoever

nature, whether capable of registration or not, but including any right to register same;

1.33 "Interim Phase " means a period of 3 (three) calendar months from the Effective Date,

1.34 "Managed Vehicle " means a vehicle which is subject to a Vehicle Management and

Maintenance Agreement and in respect of which the Contractor will provide the Services. For

the purposes of this Agreement the User Entities shall be obliged to enter into Vehicle

Management Agreements in respect of all categories of vehicles which are operated by the

User Entities and which are accepted for take-on by the Contractor pursuant to the take on

procedure contemplated in Schedule 3 (Service Procedures );

1.35 "Master Fleet Management Terms " means the master fleet management terms and conditions

contained in Schedule 1 (Master Fleet Management Schedule), pursuant to which the

Service Parties will enter into Vehicle Maintenance Agreements;

1.36 "Penalties " means the service credits payable by the Contractor to the specific User Entities on

the basis set out in the SLS;

1.37 "Pricing Principles " means the principles applicable to the costing of the Services provided by

the Contractor pursuant to this Agreement;

1.38 "Prime Rate " means the publicly quoted prime rate of interest (percent, per annum) from time

to time charged by Absa Bank Limited, as certified by any manager of such bank, whose

appointment and authority it shall not be necessary to prove, calculated daily and compounded

monthly in arrears;

1.39 "Rate Card " means the rate schedule setting out the current pricing for Services, as amended

by the Parties in writing from time to time;

1.40 "Responsible Authority " means any ministry, minister, organ of state, official in the public

administration or any other governmental or regulatory department, commission, institution,

entity, service utility, board, agency, instrumentality or authority (in each case, whether national,

provincial or municipal) or any court, each having jurisdiction over the matter in question;

1.41 "RSA" means the Republic of South Africa;

1.42 "Services " means the services to be provided by the Contractor to the User Entities, as set out

in the SLS;

1.43 "Service Levels " means the stipulated criteria applicable to the Services, as set out in the SLS;



1.44 "Service Managers " means collectively, the Fleet Managers of the respective User Entities and

the Contractor's CSEs;

1.45 "Service Parties " means collectively the Contractor on the one hand and a specific User Entity

or User Entities on the other hand, and the term "Service Party " refers to either of them;

1.46 "Service Procedures " means the processes and procedures applicable to the provision and

acquisition of Services by the Service Parties pursuant to this Agreement, as set out in

Schedule 3 (Service Procedures) as read with the provisions of the SLS, providing that

should there be any conflict between the two schedules, the provisions of the SLS shall prevail;

1.47 "Signature Date " means the date of the lasted-dated signature of this Agreement by the

Parties;

1.48 "SLS" means the Service Level Schedule defining the Services, Service Levels, reciprocal

obligations of the Service Parties in respect thereof and penalties payable in respect of any

failure to achieve such Service Levels, as set out in Schedule 2 (Service Level Schedule)

hereto;

1.49 "Staff " means, in respect of a Service Party or Contracting Party, any officer, employee, agent,

consultant or sub-contractor of such Party;

1.50 "User Entities " means the utilities, agencies, services and Municipal-Owned Entities of the

City comprising:

1.50.1 the utilities of City Power Johannesburg (SOC) Ltd, Pikitup Johannesburg (SOC) Ltd and

Johannesburg Water (SOC) Ltd;

1.50.2 the agencies, being Johannesburg City Parks (SOC) Ltd and Johannesburg Roads Agency

(SOC) Ltd;

1.50.3 the services, being Emergency Management Services and the Johannesburg Metropolitan

Police Department, which are not independent corporate entities; and

1.50.4 the Core Administration of the City which is not an independent corporate entity;

or such other entities or agencies as may be included in this Agreement by the Contracting

Parties in accordance with the Variation Procedure from time to time; and

1.51 "Variation Procedure " means the procedure set out in Schedule 4 (Variation Procedure);

1.52 "Vehicle Management Agreement " means the Managed Vehicle Management Agreement in

respect of each Managed Vehicle, to be entered into between the Contract Owner and the

Contractor, comprising the Master Fleet Management Terms and each Vehicle Schedule; and

1.53 "Vehicle Schedule " means a schedule containing the information contemplated in Annexe 1.1

to Schedule 1 (Master Fleet Management Schedule) . For the purposes of clarity, the User

Entities may include a number of vehicles on one Vehicle Schedule, but a discrete Vehicle

Management Agreement shall be constituted in respect of each Vehicle listed on such Vehicle

Schedule.



2 APPOINTMENT

The Contract Owner hereby appoints the Contractor, who accepts such appointment, to provide

the Services to the User Entities in respect of each Managed Vehicle in accordance with the terms

and conditions of this Agreement.

3 DURATION

This Agreement shall commence on the Effective Date and, subject to rights of termination

stipulated herein, shall continue for an initial period of 5 (five) years ("the Initial Period ")

whereafter it shall automatically terminate, provided that the Contract Owner may extend the

Agreement on written notice to the Contractor, which notice shall be given at least 90 (ninety) days

prior to the expiry date of the Initial Period, for a period of 6 (six) months, during which period the

Contract Owner may terminate this Agreement on 90 (ninety) days' notice to the Contractor.

4 NATURE OF RELATIONSHIP

4.1 Intention of the Parties . For the purposes of simplifying the relationship between the

Contractor on the one hand and the Contract Owner and its various User Entities on the other

hand, the Contracting Parties have agreed that the primary contractual relationship will exist

between the Contractor and the Contract Owner. In this regard it is the Contracting Parties'

intention that:

4.1.1 the Contract Owner shall be obliged and be responsible for procuring the fulfilment by the

User Entities of all the obligations contemplated in this Agreement including, without

limitation, the obligation to pay for the Services and recognise the exclusivity of the

Contractor as contemplated in clause 36;

4.1.2 all disputes, litigation and the like will be conducted and resolved exclusively between the

Contractor and the Contract Owner; and

4.1.3 neither the Contractor, nor any User Entity shall be entitled to institute action against the

other in its own name for any cause of action which arises pursuant to this Agreement.

4.2 Principal Parties not deprived of claims, etc . Likewise it is not the Contracting Parties’

intention that:

4.2.1 the Contract Owner, to the extent that it seeks to institute or defend any claim on behalf of a

User Entity; or

4.2.2 the Contractor;

be deprived of any indemnity, claim, counterclaim, right, action, remedy, exception, limitation of

liability or defence due to the structure implemented.

4.3 Quasi-contractual relationship . The relationship between the Contractor and each User

Entity shall thus constitute a quasi-contractual relationship with the effect that, whilst no

contractual nexus factually exists between the Contractor and such User Entity, the Service

Parties shall conduct themselves as if a contract on the terms and conditions of this Agreement



exists between them and to the extent that any claim arises, same shall, to the extent required,

be instituted, disputed and resolved between the Contract Owner and the Contractor on the

basis that each shall have all rights and duties in law and this Agreement as if they were the

principal parties to the dispute.

4.4 Deed of Adherence . Each User Entity shall be required to sign a Deed of Adherence on

substantially the terms set out in Schedule 12 (Deed of Adherence) in order to confirm its

acceptance of the terms set out in this clause 4.

4.5 Clarification . Without derogating from the generality of the aforegoing, it is thus confirmed that

to the extent that:

4.5.1 any User Entity is guilty of any act or omission which would, were it a party to this

Agreement, constitute a breach of this Agreement, such breach shall be deemed to be a

breach of this Agreement by the Contract Owner;

4.5.2 the Contractor is guilty of any act or omission in respect of a User Entity, which would, were

such User Entity a party to this Agreement, constitute a breach of this Agreement, such

breach shall be deemed to be a breach of its obligations to the Contract Owner in terms of

this Agreement;

4.5.3 any User Entity suffers any loss, harm or damage due to any act or omission of the

Contractor pursuant to this Agreement such loss, harm or damage shall be deemed to be

that of the Contract Owner and Each User Entity, by signing the Deed of Adherence shall

subrogate its rights in respect of any such claim to the Contract Owner and shall not itself,

under any circumstances whatsoever have any claim against the Contractor. In such

circumstances:

4.5.3.1 the Contract Owner shall procure that the User Entity fulfils all its obligations in terms of

the common law in respect of such damages, including without limitation the relevant

User Entity’s obligation to mitigate its losses;

4.5.3.2 the Contract Owner shall be liable to the Contractor to the extent that the Contractor

would have had any successful contractual or delictual claim (or counterclaim) against

the User Entity in respect of such action;

4.5.4 the Contractor suffers any loss, harm or damage due to any act or omission of a User Entity

pursuant to this the Contractor shall, vis-à-vis the Contract Owner:

4.5.4.1 fulfil all its obligations in terms of the common law in respect of such damages, including

without limitation the obligation to mitigate its losses;

4.5.4.2 indemnify the Contract Owner to the extent that the User Entity would have any

contractual or delictual claim (or counterclaim) against the Contractor.

5 SOCIO ECONOMIC DEVELOPMENT

The Contractor shall implement and comply with the socio-economic development commitments

and requirements set out in Schedule 6 (Socio-Economic Development).



6 THE SERVICES

6.1 Own cost and risk . Subject to, and in accordance with, the provisions of this Agreement, the

Contractor shall exercise its rights and perform its obligations included in the Services at its own

cost and risk without recourse to the Contract Owner save as otherwise expressly provided for

in this Agreement.

6.2 Provision of Services . During the term of this Agreement, the Contractor shall at its own cost

and risk be solely responsible for procuring that the Services are provided to the User Entities:

6.2.1 in accordance with the Service Levels;

6.2.2 in accordance with Good Industry Practice;

6.2.3 in accordance with the terms of this Agreement;

6.2.4 in a manner that is not likely to cause death, injury to the health of any person or damage to

property or the environment;

6.2.5 in a reasonable manner that is consistent with the City discharging its statutory functions and

duties; and

6.2.6 in compliance with all applicable laws and the Consents;

6.3 Co-operation . Each of the Contractor on the one hand and the User Entities on the other hand

shall co-operate with the other in the exercise and performance of their respective rights and

obligations under this Agreement.

7 VARIATION PROCEDURE

7.1 Amendments to this Agreement . Should the Contracting Parties at any stage wish to amend

the provisions of this Business Relationship Agreement including the provisions of this clause,

they shall do so by way of a written amendment signed by the authorised representatives of

each Contracting Party. Accordingly no variation, addition or consensual cancellation of this

Agreement shall be of any force or effect unless reduced to writing and signed by the duly

authorised representatives of each Contracting Party.

7.2 Change in scope of services . Should any Service Party wish to propose any change to the

scope or nature of Services, same shall be implemented in accordance with the Variation

Procedure.

8 SERVICE LEVELS

8.1 Undertaking to achieve Service Levels . The Contractor undertakes that in providing the

Services to the User Entities, it will achieve the Service Levels set out in the SLS.

8.2 Service Credits . Without detracting from any rights or remedies which the Contract Owner may

have in terms of this Agreement or law, the Contractor shall be liable for the payment of the

Service Credits on the basis set out in the SLS.



8.3 Obligations upon failure to meet Service Levels . Should the Contractor at any time fail to

meet the Service Levels due to its Default, the Contractor will, without prejudice to the User

Entities’ other rights and remedies:-

8.3.1 as an adjustment to the consideration payable in terms of this Agreement, credit the User

Entity concerned with such Service Credits, if any, as may be stipulated in the SLS; and

8.3.2 provide all such additional resources as may be necessary to perform the Services in

accordance with the Service Levels as early as practicable thereafter and at no additional

charge to the User Entity concerned;

provided that, for the purposes of clarity it is recorded that the Contractor shall not be liable for

any failure to meet a Service Level to the extent that such failure arises directly out of an event

of force majeure or a failure of the User Entity to comply with its responsibilities set out in the

SLS.

8.4 Interim Phase . Notwithstanding the provisions of this clause 8, it is recorded that during the

Interim Phase the Contractor will not be penalised for any failure to meet the Service Levels,

but shall nonetheless be obliged to use its best endeavours to attempt to provide the Services

in accordance with the Service Levels during such period.

9 WITHHOLDING OF PERFORMANCE & SET-OFF

9.1 No withholding of Services . Subject to clause 9.2, the Contractor may not withhold any

Services or Vehicles from any User Entity during the term of this Agreement.

9.2 Exception . Notwithstanding the provisions of clause 9.1. and without prejudice to any of its

other rights in terms of this Agreement or at law, should any User Entity, in the absence of any:-

9.2.1 bona fide dispute between the Service Parties in respect thereof; or

9.2.2 material breach of this Agreement by the Contractor which has been notified by the Contract

Owner to the Contractor,

fail to make payment on the due date of any amount due to the Contractor under and in terms

of this Agreement and persist in any such failure for a period in excess of one hundred and

twenty days, the Contractor shall notify the Contract Owner’s Contract Manager of such failure

and demand payment. Should the Contract Owner fail to procure payment of all such

outstanding amounts within 14 (fourteen) days of receipt by the Contract Manager of such

notice, the Contractor may suspend the Services in respect of the User Entity concerned, for so

long as payment remains outstanding, provided that the Contractor shall immediately resume

provision of the Services to the User Entity concerned upon receipt of such payment.

10 REPORTS

10.1 Provision of Information . The Contractor shall provide accurate information to the User

Entities in order to enable them to manage their fleet requirements with respect to the Managed



Vehicles. Such information shall be provided on the basis set out in the SLS and shall reflect

information which is current to within 24 (twenty four) hours.

10.2 Management Reports . The Contractor shall furnish the Contract Owner with the reports set out

in the SLS on the terms and format stipulated therein.

11 CONTRACTOR’S STAFF

11.1 Suitably Qualified Staff . The Contractor shall employ suitably qualified and trained Staff to

provide the Services to the User Entities in terms of this Agreement, provided that they shall be

entitled, in their discretion, to allocate Staff resources in accordance with the skills and

knowledge required, provided further that any exercise of such discretion shall not negatively

impact upon the provision of the Services to the User Entities.

11.2 The Contractor Staff . The Contractor Staff providing the Services may be absent for short

periods of time for reasons including annual leave and training. The Contractor undertakes to

avoid any disruption of the Services because of such circumstances.

11.3 Replacement of Service Managers . Any Service Party may substitute Service Managers at

its discretion and each will give reasonable notice to the other of such substitution and will

provide replacement Staff of equivalent ability. Without derogating from the aforegoing, should

the Contractor replace a CSE for any reason whatsoever, it shall ensure, to the greatest extent

possible in the circumstances, that a suitable period of handover and overlap, being not less

than 30 (thirty) days, takes place between the new and the incumbent CSE. The costs of such

handover shall be borne by the Contractor.

11.4 Access to premises . Each User Entity shall grant the Contractor Staff reasonable access to

all its premises for the purpose of providing the Services and Managed Vehicles in terms of this

Agreement.

11.5 The Contractor to adhere to security procedures of User Entities . The Contractor Staff

shall at all times when on User Entities premises adhere to the standard health, safety and

security procedures and guidelines applicable to User Entity's Staff, as varied and conveyed in

writing by the User Entities to the Contractor from time to time. It shall at all times be the

responsibility of the Contractor to notify its Staff of such changes and no User Entity shall be

liable for any failure by the Contractor to do so. Should any User Entity have reason to believe

that any of the Contractor’s Staff is failing to comply with such standard health, safety and

security procedures and guidelines, the City may deny such person access to any or all of the

City’s premises or systems and, upon providing the Contractor with the reasons for such

request, require the Contractor to replace such person immediately.

12 PROCESSES & PROCEDURES

In providing and acquiring the Services in terms of this Agreement, the Service Parties shall

adhere to the Service Procedures.



13 CONSIDERATION

13.1 Fees and payment terms . For the Services provided to the User Entities by the Contractor in

terms of this Agreement, the User Entities will pay the Contractor the fees set out in Schedule

11 (Fees and Payment), on the terms and conditions set out therein.

13.2 Late Payments . The Contractor shall be entitled, without prejudice to any other right or

remedy, to receive interest on any payment not duly made pursuant to the terms of this

Agreement on the due date at the Prime Rate.

13.3 Disputed Charges . Should any User Entity dispute any amount reflected in any invoice in

good faith, the User Entity shall advise the Contractor of such disputed amounts, together with

the reasons for disputing same, in writing within 30 (thirty) days of any invoice, provided that:

13.3.1 the User Entity shall pay all undisputed amounts in respect of such invoice; and the User

Entity shall not be entitled to withhold any such undisputed amounts pending resolution of

the dispute;

13.3.2 should the contractor and the relevant User Entity fail to resolve such dispute within 30

(thirty) days of it having been raised in terms of this clause, such dispute shall be referred for

dispute resolution in accordance with the Dispute Resolution Procedure.

13.4 Value added tax . Any invoice or other request for payment of monies due to the Contractor

under this Agreement shall comply with the requirements of the Value Added Tax Act, 1991.

14 DATA

14.1 Ownership . Ownership in all the City’s Data, whether under its control or not, shall continue to

vest in the relevant User Entities and the Contractor shall not obtain any proprietary rights in

such data. Without derogating from the aforegoing, the database (but not, for the avoidance of

doubt, the database application) containing the up to date information in respect of the

Managed Vehicles, including all back-up copies of such data, shall vest in the relevant User

Entity.

14.2 Data may only be used in performance of the Service s. The City’s Data in the possession

of the Contractor, or to which the Contractor may have access during the currency of this

Agreement, may not be used by the Contractor for any purposes whatsoever other than as may

be specifically required to enable the Contractor to comply with its obligations in terms of this

Agreement.

14.3 Preservation of integrity of data . The Contractor shall take reasonable precautions to

preserve the integrity of the City’s Data under its control and to prevent any unauthorised

access, corruption or loss of such data. Without limiting the aforegoing, the Contractor shall

implement and maintain suitable:-

14.3.1 back up procedures;

14.3.2 security policies; and



14.3.3 disaster recovery plans;

to ensure the integrity of the data at all times.

14.4 Return of data . Upon termination of this Agreement, the Contractor shall provide such data

and database to the Contract Owner, in the format such data is in at the date of termination, or

such other format as may be agreed between the Contracting Parties, within 2 (two) days of

such termination.

15 USER SATISFACTION SURVEY

15.1 Services to enable business purpose . Whilst the Contracting Parties agree that the Services

will be provided at the levels stipulated in the SLS, the Contractor acknowledges that the

ultimate purpose of the Services is to enable the User Entities to achieve their business

purpose. Accordingly the Contractor undertakes that, notwithstanding any Service Levels

which may be stipulated, it shall provide the Services at a level and in a manner which are in

accordance with Good Industry Practice and pricing.

15.2 User satisfaction surveys . In order to gauge the above, the Contract Owner may on 30

(thirty) days notice to the Contractor, conduct user satisfaction surveys during the currency of

this Agreement. Such survey shall be conducted at the City Contract Owner's cost amongst the

users of the Services within the User Entities.

15.3 Consequences of Survey . Subject to such surveys being conducted by an Independent

Expert who shall be a reputable third party survey company, on a statistically acceptable basis

with regard, inter alia, to the representative nature of the sample and the conclusions drawn,

the Contractor agrees that should any such survey indicate that the level of service being

provided by the Contractor to the User Entities is unsatisfactory to the users, the Contract

Owner may, notwithstanding the fact that the services are being provided within the Service

Levels, request the Contractor to submit a remediation plan to address the concerns raised.

Such plan shall be submitted by the Contractor within 30 (thirty) days of notification by the

Contract Owner, or such longer period as the Contract Owner may agree, and shall be

reasonable with regard to the cost and ease of implementation. The approval and

implementation of any remediation plan shall take place in accordance with the Variation

Procedure.

15.4 Failure . Should the Contractor fail:-

15.4.1 to submit such remediation plan within the time period contemplated above;

15.4.2 to implement any remediation plan approved by the Contract Owner in terms of the Variation

Procedure;

such failure shall constitute a material breach of this Agreement.



16 BENCHMARKING

16.1 Benchmarking . The Contract Owner reserves the right to benchmark some of the Contractor's

charges, and the Contractor shall provide all reasonable assistance to the Contract Owner to

carry out the benchmarking exercise, which shall be carried out according to the principles set

out in Schedule 7 (Benchmarking Principles) .

16.2 Costs . The Contract Owner shall bear all costs in carrying out the benchmarking exercise,

provided that the costs of the Contract Owner (including any costs, fees and charges payable to

the benchmarker) shall be borne by the Contractor where the results of the benchmarking

exercise indicate the benchmarked charges are more than 105% of such charges generally

applicable to Services rendered by any third party suppliers reviewed in the benchmarking

exercise.

16.3 Impact . The Contractor’s fees and charges to the User Entities shall be reduced in line with the

results of the benchmarking exercise, such reduction to take effect from the first month following

the conclusion of the benchmarking exercise. The Contracting Parties shall execute such

amended versions of the SLS and Schedules affected by this election in order to reflect in

contractual terms, the outcome of the Benchmarking exercise.

16.4 Restrictions . It is recorded that the Contract Owner may only conduct such benchmarking

exercise after 12 (twelve) months of this Agreement, as from the Effective Date, have elapsed

and may only conduct such exercise on one occasion in any Contract Year.

17 GOVERNANCE STRUCTURES

In order to facilitate the smooth and effective management of the relationship, the Service Parties

will implement and adhere to the contract governance structures set out in Schedule 10 (Contract

Governance Structure).

18 CORRUPT ACTS

18.1 Warranty . The Contractor warrants that in entering into this Agreement it has not committed

any Corrupt Act.

18.2 Consequences of breach of warranty against Corrupt Acts . If the Contractor, any

shareholder, any subcontractor or any affiliate of any of them or any of their Staff commits or is

reasonably suspected (and such reasonable suspicion is supported by prima facie evidence

confirming that reasonable suspicion on a balance of probabilities) by the City of having

committed any Corrupt Act, then:

18.2.1 if the Corrupt Act is committed by the Contractor, any shareholder of the Contractor or any

member of their Staff acting under the authority of or with the knowledge of a director of the

Contractor or such shareholder, as the case may be, then in any such case, the City may

terminate this Agreement with immediate effect by giving written notice to the Contractor;

18.2.2 if the Corrupt Act is committed by a Staff member of the Contractor or of any shareholder

acting of his or her own accord, then in any such case, the City may give written notice to



the Contractor of termination and this Agreement will terminate, unless within 7 (seven)

Business Days of the Contractor’s receipt of such notice that member of Staff’s involvement

in the provision of Services is terminated and (if necessary) the performance of any part of

the Services previously performed by him or her is performed by another person;

18.2.3 if the Corrupt Act is committed by a subcontractor, director of a subcontractor or an

employee of a subcontractor acting under the authority or with the knowledge of a director of

that subcontractor, then in any such case, the City may give written notice to the Contractor

of termination and this Agreement will terminate, unless within 14 (fourteen) Business Days

of its receipt of such notice the Contractor terminates the relevant subcontract and procures

the performance of the relevant part of the Services by another person;

18.2.4 if the Corrupt Act is committed by an employee of a subcontractor acting of his or her own

accord, then the City may give notice to the Contractor of termination and this Agreement

will terminate, unless within 7 (seven) Business Days of its receipt of such notice the

Contractor procures the termination of that employee’s involvement in the provision of

Services and (if necessary) procures the performance of that part of the Services previously

performed by that employee to be performed by another person;

18.2.5 if the Corrupt Act is committed by any other person not specified in clauses 18.2.1 to 18.2.4

above but involved in the provision of Services as a subcontractor or supplier to any

subcontractor or to the Contractor, then the City may give notice to the Contractor of

termination and this Agreement will terminate unless within 7 (seven) Business Days the

Contractor procures the termination of such person’s involvement in the provision of

Services and (if necessary) procures the performance of the relevant part of the Services by

another person; and

18.2.6 any notice of termination under this clause shall specify:

18.2.6.1 the nature of the Corrupt Act;

18.2.6.2 the identity of the party or parties who the City believes has committed the Corrupt Act;

and

18.2.6.3 the date on which this Agreement will terminate in accordance with the applicable

provisions of this clause.

18.3 Contract Owner’s remedies . Without prejudice to its other rights or remedies under this

Clause, the City shall be entitled to recover from the Contractor, the greater of:

18.3.1 the amount or value of the gift, consideration or commission which is the subject of the

Corrupt Act; and

18.3.2 any direct losses sustained by the City in consequence of any breach of this clause 18 by

the Contractor.



18.4 Proper commissions permissible . Nothing contained in this clause 18 shall prevent the

Contractor from paying any proper commission or bonus to its Staff within the agreed terms of

their employment.

18.5 Contractor to notify of Corrupt Acts . The Contractor shall notify the Contract Owner of the

occurrence (and details) of any Corrupt Act promptly on the Contractor becoming aware of its

occurrence.

19 THE CONTRACTOR'S WARRANTIES

19.1 General The Contractor gives the Contract Owner the warranties, representations and

undertakings stipulated in this clause 19 ("Warranties ") on the basis that

19.1.1 each Warranty is deemed to be an essential contractual undertaking by the Contractor to

ensure that each Warranty is true and correct;

19.1.2 each such Warranty shall be deemed to be material;

19.1.3 insofar as any Warranty is promissory or relates to a future event, such Warranty shall be

deemed conclusively to have been given as at the due date for fulfilment of the promise or

for the happening of the event, as the case may be;

19.1.4 each such Warranty shall be a separate and independent Warranty and shall not be limited

by any reference to, or inference from, the terms of any other Warranty or by any other

provision of this Agreement; and

19.1.5 each such Warranty shall, save as expressly stipulated otherwise, be given as at the date of

signature of this Agreement and shall be deemed to be repeated on each day during the

term of this Agreement.

19.2 Contractor warranties . The Contractor warrants that:

19.2.1 it has taken all necessary actions to authorise its execution of this Agreement;

19.2.2 the execution and performance of this Agreement do not and will not contravene any

provision of the memorandum or articles of association of the Contractor as at the Signature

Date, or any order or other decision of any Responsible Authority or arbitrator that is binding

on the Contractor as at the Signature Date;

19.2.3 all Consents required by the Contractor for the provision by it of the Services are in full force

and effect as at the Signature Date, save for any Consents which are not required under

applicable law to be obtained by the Signature Date; provided that the Contractor warrants

that it knows of no reason (having made all reasonable enquiries in this regard) why any

such Consent will not be granted on reasonable terms by the time it is required to obtain

such Consent;

19.2.4 no litigation, arbitration, investigation or administrative proceeding is in progress as at the

Signature Date or, to the best of the knowledge of the Contractor, as at the Signature Date



having made all reasonable enquiries, threatened against it, which is likely to have a

material adverse effect on the ability of the Contractor to render the Services;

19.2.5 no proceedings or any other steps have been taken or, to the best of the knowledge of the

Contractor having made all reasonable enquiries, threatened for the winding-up or

liquidation (whether voluntary or involuntary, provisional or final), judicial management

(whether provisional or final) or deregistration of the Contractor, or for the appointment of a

liquidator, judicial manager or similar officer over it or over any of its assets;

19.2.6 all information disclosed by or on behalf of the Contractor to the Contract Owner at any time

up to the Signature Date and, in particular, during the bid process preceding the award of

this Agreement to the Contractor, is true, complete and accurate in all material respects and

the Contractor is not aware of any material facts or circumstances not disclosed to the

Contract Owner which would, if disclosed, be likely to have an adverse effect on the

Contract Owner’s decision (acting reasonably) to award the Agreement to the Contractor;

19.2.7 it possesses the requisite knowledge, skill and experience to perform the Services in an

expert manner; and

19.2.8 the maintenance of all Vehicles undertaken by them pursuant to this Agreement shall be

conducted in accordance with Good Industry Practice.

19.3 The Contractor to comply with all employment legisl ation, etc . The Contractor warrants

that it has full knowledge of all relevant statutory, collective and other stipulations applicable to

the relationship with its contractors and its relationship with the Contract Owner. This includes,

but is not limited to, the Labour Relations Act, the Basic Conditions of Employment Act, 1997,

the Employment Equity Act, 1998 and any other applicable employment legislation currently in

force. The Contractor warrants further that it is not and will not in future be in contravention of

any of the provisions of any such legislation and in the event of such contravention, the

Contractor shall immediately take all steps to remedy such contravention. If the Contract

Owner advises the Contractor of any contravention of such legislation in writing, the Contractor

shall, within 10 (ten) days after receipt of such notice, take all steps necessary to remedy such

contravention and shall keep the Contract Owner informed regarding the steps taken and the

implementation and the result thereof.

19.4 No temporary employment service . The Contractor warrants that it is conversant with section

198(4) of the Labour Relations Act and warrants further that any contractor supplied by the

Contractor shall be an independent contractor as defined in the Labour Relations Act and the

Occupational Health and Safety Act, 1993 and will render the Services as such. The Contractor

shall not have the authority to act on behalf of the Contract Owner or any User Entity or to bind

such parties in any manner whatsoever without their prior written consent and shall not be

considered as having employee status for the purpose of any benefit applicable to the User

Entities' employees generally.



20 CONTRACTOR’S INDEMNITIES

20.1 General indemnity . The Contractor indemnifies and shall keep the Contract Owner Contract

Owner and User Entities ("Indemnified Parties ") indemnified at all times against all losses

sustained by the Indemnified Parties in consequence of any:

20.1.1 loss of or damage to property;

20.1.2 breach of a statutory duty arising under applicable law;

20.1.3 claim for or in respect of the death or personal injury of any individual; or

20.1.4 any breach by the Contractor of any warranties given by it in this Agreement;

(including, without limitation, any legal fees or costs) arising in connection with the performance

or non-performance by the Contractor of any Services, save to the extent caused by the

negligence or wilful misconduct of the Indemnified Parties or by a breach by the Indemnified

Parties of an express provision of this Agreement.

20.2 Section 198(4) indemnity . The Contractor indemnifies and shall keep the Indemnified Parties

indemnified at all times against all losses sustained by the Indemnified Parties in consequence

of any claim or action whatsoever in terms of section 198(4) of the Labour Relations Act,

instituted against an Indemnified Party by a contractor of the Contractor. In the event that the

Contractor or any of its contractors rendering the Services to the User Entities, become involved

in arbitration or other proceedings falling under a collective agreement under a bargaining

council, then the Contractor shall immediately inform the Contract Owner thereof and on

request supply the Contract Owner with a copy of any award made pursuant to such

proceedings or agreement and any documentation that the Contract Owner may request in

respect thereof;

20.3 Indemnity in respect of Competition issues . The Contractor hereby confirms that it has

acquired professional opinion to the effect that no notification to the competition authorities is

required if this Agreement is awarded to it. Accordingly the Contractor hereby indemnifies and

holds the Indemnified Parties and all relevant officials harmless against any fine, penalty or

other payment which the Indemnified Parties or such officials may be required to pay to the

competition authorities whether as a result of the incorrectness of the opinion, or otherwise,

including any and all legal costs incurred by the Indemnified Parties pursuant thereto.

20.4 Liability and indemnity . The Contractor shall be liable for all loss, harm or damage which

arises in respect of or due to any Managed Vehicle being in the Contractor's possession during

term of this Agreement. The Contractor hereby indemnifies and holds the Indemnified Parties

harmless against all:-

20.4.1 direct loss or damage which may be sustained by the Indemnified Parties or its Staff; and

20.4.2 loss, actions, costs, claims, demands, expenses, liabilities or any amounts whatsoever

which may become payable by the Indemnified Parties to any other person as a result of a

claim made against an Indemnified Party or its Staff;



arising out of the Contractor's possession of the relevant Managed Vehicle.

20.5 Process in the event of a claim . Should any claim be made against an Indemnified Party by

any person in terms of this clause 20:-

20.5.1 the Indemnified Party shall give the Contractor written notice thereof within 30 (thirty) days of

becoming aware of such claim to enable the Contractor to take steps to contest it;

20.5.2 the Contractor may, within 7 (seven) days of receipt of the notice in terms of clause 20.5.1,

elect, in writing, to contest an indemnified claim in the name of the Indemnified Party and

may control the proceedings in respect thereof (including any appeals), provided that the

Contractor indemnifies the Indemnified Party and holds it harmless (in a manner reasonably

acceptable to the Contract Owner) against all and any costs (including without being limited

to attorney and own client costs and any other costs not recoverable on taxation) which may

be incurred by or awarded against the Indemnified Party as a consequence of the defence of

any indemnified claim;

20.5.3 the Contractor shall pay the Indemnified Party the amount of an indemnified claim within 7

(seven) days of receipt of the notification referred to in clause 20.5.1, unless the Contractor

contests the indemnified claim in terms of clause 20.5.2, in which case the Contractor shall

pay to the Indemnified Party the amount of the indemnified claim within 7 (seven) days after

any final judgement or order is granted against the Indemnified Party, provided that in those

circumstances where a claim is contested and despite such contest, the claim is payable in

law, the Contractor shall pay to the Indemnified Party the amount of the claim as soon as it

is payable, provided further that should such amount be repaid to the Indemnified Party, the

Indemnified Party shall refund such amount to the Contractor within 7 (seven) days of

receiving such amount;

20.5.4 the Indemnified Party shall furnish the Contractor with all reasonable assistance and shall

cooperate in every reasonable way to facilitate the defence and/or settlement of any such

claim, action, proceeding or suit provided that the Contractor shall reimburse and pay to the

Indemnified Party all reasonable costs and expenses incurred by the Indemnified Party in

respect of such assistance and co-operation. Without derogating from the aforegoing, the

Indemnified Party shall not: -

20.5.4.1 make any admissions of liability in respect of such claims;

20.5.4.2 knowingly (which term shall include instances where the Indemnified Party ought

reasonably to have known) act or omit to act in a manner which may prejudice the

Contractor's rights.

21 LIMITATIONS ON LIABILITY

Under no circumstances shall the Contractor, the Contract Owner or any User Entity be liable for

any special, indirect, consequential or like damages which may arise pursuant to this Agreement

including, without limitation, any damages arising due to any loss of profits or loss of business.



22 CONTRACT OWNER WARRANTIES

The Contract Owner hereby warrants to the Contractor that as at the Signature Date:-

22.1 it has the power to execute the Agreement and any other documents referred to in the

Agreement to which it is a party and has taken all necessary actions to authorise such

execution;

22.2 it has the power to perform its obligations under the Agreement and any other documents

referred to in the Agreement to which it is a party and has taken all necessary actions to

authorise such performance; and

22.3 it has not knowingly omitted to disclose to the Contractor any material relevant information in its

possession or under its control.

22.4 it is duly authorised to represent each of the User Entities in entering into this Agreement and

each User Entity will be bound by the provisions of this Agreement, by executing a Deed of

Adherence, or otherwise.

23 CONSENTS

23.1 Each Party’s responsibility . Each Contracting Party shall be responsible for:

23.1.1 obtaining all Consents which may be required by it in connection with its obligations under

this Agreement;

23.1.2 maintaining in full force and effect all Consents required by it; and

23.1.3 implementing all Consents required by it in accordance with their respective terms within the

period of their validity.

23.2 Mutual assistance . Each Service Party shall provide all such assistance to the other Service

Party as may be reasonably necessary for the other Service Party to obtain the Consents

referred to in clause 23.1.1; provided, however, that the Party providing assistance shall incur

no liability for the costs of obtaining or maintaining, or any delay, failure or inability of the other

Party to obtain or maintain any such Consents.

24 OBLIGATIONS OF THE CONTRACTOR.

24.1 Problem and Negative Trend Identification . Should the Contractor encounter any problem or

identify any trend in relation to any of the Services or the Vehicles or any component thereof,

which could cause, or which indicates the likely occurrence of, a disruption to any User Entity’s

business or the availability of the Services or Vehicles, it must report such matter to the

Contract Owner in writing without delay. Thereafter, the Parties will agree on corrective

measures to be taken to address or pre-empt the problem, as the case may be, in accordance

with the Variation Procedure.

24.2 Items required for the Services . Save as provided otherwise, the Contractor shall supply all

items required for the provision of the Services at its sole cost and risk.



25 OBLIGATIONS OF THE CITY

The Contract Owner shall ensure that any User Entity over which it has direct control performs its

duties and functions referred to in this Agreement in a manner which enables the Contractor to

comply with their obligations to provide the Services.

26 REVIEW OF THE AGREEMENT

It is fundamental to the success of this Agreement and the Contracting Parties' ongoing

relationship that this Agreement reflects and continues to reflect their prevailing business

imperatives and capabilities. Consequently the Contracting Parties agree that for the purposes of

reviewing this Agreement, the Services, or any other matter arising out of this Agreement, they will,

at a minimum, formally meet within 30 (thirty) days of the anniversary of the Effective Date (or at

such other time as the Parties may agree) each year during the term of this Agreement provided

that any and all changes agreed at such meetings shall be executed in accordance with the

Variation Procedure.

27 INSPECTION

27.1 The Contractor to maintain full set of records . The Contractor shall ensure that a full and

accurate set of records is kept of all Services performed in terms of this Agreement for a period

of 5 (five) years after the provision of any such Services. In addition the Contractor shall, in

order to enable the Contract Owner to determine whether the provisions of this Agreement are

being complied with:

27.1.1 provide within a five days of the written request therefor, the Contract Owner with such

information as it may reasonably require;

27.1.2 allow the Contract Owner to inspect and take copies of any documents of the Contractor

relating to the Services, including all data, information, procedures, event logs, transaction

logs, audit trails, books, records, contracts and correspondence;

27.1.3 allow the Contract Owner or its authorised representatives to conduct interviews with any of

the Contractor’s employees, subject to reasonable notice being given and the Contractor's

employees consenting thereto.

27.2 Exclusions . Notwithstanding the provisions of clause 27.1, the Contract Owner shall not be

entitled to access the financial statements and balance sheet of the Contractor, provided that

should the Contract Owner require to inspect such excluded records, it may request the

Contractor's auditors, or the forensic services division of any auditing firm of international

standing and repute, to scrutinise such records to determine the existence of any irregularity

reasonably suspected by the Contract Owner, provided that any party other than the

Contractor's auditors shall be obliged to maintain the confidentiality of the aforementioned

excluded records.

27.3 The Contractor to provide reasonable assistance . Where any information required for the

inspection in terms of this clause 27 is kept by means of a computer, the Contractor shall give



the Contract Owner such reasonable assistance it requires to facilitate inspection and the taking

of copies of the information in a visible and legible form or to inspect and check the operation of

any computer and any associated apparatus or material that is or has been in use in connection

with the keeping of the information.

27.4 Information to be provided in specified form . Any information required to be provided to the

City pursuant to this clause 27 shall be provided by the Contractor, at the Contract Owner's

cost, in such form (unless same is in electronic format, in which event it will be provided at no

cost) as the Contract Owner may reasonably specify.

27.5 The Contractor to allow access to premises . Where, pursuant to any provision contained in

this clause 27, the Contractor is required to allow the Contract Owner to inspect or take copies

of any item of any description the Contractor shall allow the Contract Owner, or its authorised

representatives, such access to any premises of the Contractor as is necessary to enable the

Contract Owner to inspect or take copies of the items.

27.6 Cost of inspection . The cost of any inspection inclusive of copies to be made contemplated in

terms of this clause shall be for the account of the Contract Owner unless any material

irregularity or failure on the part of the Contractor is determined and proven by the Contract

Owner in the course of such inspection.

27.7 Minimum interference . The inspection contemplated in this clause 27 will be conducted:-

27.7.1 during normal business hours; agreed

27.7.2 with the minimum of interference in the provision of the Services and the Contractor’s other

operations.

28 CONFIDENTIAL INFORMATION

28.1 Confidentiality obligation . Each Contracting Party ("the Receiving Party ") must treat and

hold as confidential all information which they may receive from the other Contracting Party

("the Disclosing Party ") or which becomes known to them concerning the Disclosing Party

during the currency of this Agreement.

28.2 Nature of the confidential information . The confidential information of the Disclosing Party

shall, without limitation, include:-

28.2.1 all software and associated material and documentation, including information contained

therein;

28.2.2 all information relating to :-

28.2.2.1 the Disclosing Party's past, present and future research and development;

28.2.2.2 the Disclosing Party's business activities, products, services, customers and clients, as

well as its technical knowledge and trade secrets;

28.2.2.3 the terms and conditions of this Agreement;

28.2.2.4 the City’s Data.



28.3 The Receiving Party's obligations with regard to co nfidential information . The Receiving

Party agrees that in order to protect the proprietary interests of the Disclosing Party in its

confidential information:

28.3.1 it will only make the confidential information available to those of its Staff who are actively

involved in the execution of this Agreement;

28.3.2 it will initiate internal security procedures reasonably acceptable to the Disclosing Party to

prevent unauthorised disclosure and will take all practical steps to impress upon those Staff

who need to be given access to confidential information, the confidential nature thereof;

28.3.3 subject to the right to make the confidential information available to their Staff under clause

28.3.1, they will not at any time, whether during this Agreement or thereafter, either use any

confidential information of the Disclosing Party or directly or indirectly disclose any

confidential information of the Disclosing Party to third parties;

28.3.4 all written instructions, drawings, notes, memoranda and records of whatever nature relating

to the confidential information of the Disclosing Party which have or will come into the

possession of the Receiving Party and its Staff, will be, and will at all times remain, the sole

and absolute property of the Disclosing Party and shall be promptly handed over to such

Disclosing Party when no longer required for the purposes of this Agreement.

28.4 Obligations in respect of confidential information upon termination . Upon termination or

expiry of this Agreement, the Receiving Party will deliver to the Disclosing Party or, at the

Disclosing Party’s option, destroy all originals and copies of the Disclosing Party's confidential

information in its possession.

28.5 Exceptions . The foregoing obligations shall not apply to any information which:

28.5.1 is lawfully in the public domain at the time of disclosure;

28.5.2 subsequently and lawfully becomes part of the public domain by publication or otherwise;

28.5.3 subsequently becomes available to the Receiving Party from a source other than the

Disclosing Party, which source is lawfully entitled without any restriction on disclosure to

disclose such confidential information;

28.5.4 is disclosed pursuant to a requirement or request by operation of law, regulation or court

order; or

28.5.5 is disclosed by the City to any Responsible Authority.

28.6 Disclosure to professional advisors . Nothing in this clause shall preclude the Contracting

Parties from disclosing the confidential information:-

28.6.1 to their professional advisors in the bona fide course of seeking business advice and

professional advice; or

28.6.2 to the extent reasonably necessary to enforce their rights in terms of this Agreement.



28.7 Indemnity in respect of confidential information . The Receiving Party hereby indemnifies

the Disclosing Party against any loss or damage, which the Disclosing Party may suffer as a

result of a breach of this clause by the Receiving Party or its Staff.

28.8 Severability . The provisions of this clause 28 are severable from the rest of the provisions of

this Agreement and shall survive its termination and continue to be of full force and effect for a

period of 10 (ten) years after the date of termination.

29 INTELLECTUAL PROPERTY RIGHTS

29.1 Intellectual Property of the User Entities.

29.1.1 All Intellectual Property Rights of the User Entities shall remain the sole property of the User

Entities and nothing in this Agreement shall grant the Contractor any licence to use or exploit

same.

29.1.2 Each User Entity may, on prior written application by the Contractor, grant a non-exclusive

revocable right and licence to the Contractor to use the User Entity’s trademarks and logos

for a period not to exceed the term of this Agreement.

29.1.3 In order to establish and maintain standards of quality and propriety acceptable to the

relevant User Entity, if the Contractor desires to use a User Entity's trademarks or logos in

any way, the Contractor shall first submit the concept or a sample of the proposed use to the

relevant User Entity for approval, which shall be in the User Entity’s sole discretion. The

User Entity shall use reasonable endeavours to advise the Contractor of its approval or

disapproval of the concept or sample within 15 (fifteen) Business Days of its receipt of the

concept or sample. If the User Entity approves the concept or sample, the Contractor shall

not depart therefrom in any respect without the City’s further prior written approval.

29.1.4 If at any time the User Entity revokes its approval for the specified use of any trademark or

logo, the Contractor shall forthwith discontinue all use of such trademark or logo. The costs

incurred by the Contractor as a result of such revocation shall be borne by the Contractor if

the grounds for the revocation include any ground described in clause 29.1.5.

29.1.5 The User Entity may revoke its approval upon 3 (three) Business Days written notice to the

Contractor if the Contractor, any subcontractor or any of its or its subcontractors’ Staff

commits any crime or otherwise engages in conduct which violates any law, or engages in

any conduct that offends against public morals and decency and, in the User Entity’s

reasonable opinion, materially prejudices the reputation and public goodwill of the City or the

User Entity.

29.1.6 The Contractor acknowledges that the names of the User Entities (the "Protected Names")

are associated with and peculiar to the City and are the intellectual property of the City.

Consequently, the Contractor agrees that the sole and exclusive ownership of the Protected

Names shall vest in the City or the relevant User Entity, as the case may be.



29.1.7 In circumstances where the Contractor utilises any of the Protected Names, either on its own

or in combination or association with any other name, it shall do so only in terms of this

Agreement and with the prior approval of the relevant User Entity. On termination or expiry

of this Agreement, the Contractor shall not be entitled to operate or conduct any business

using any of the Protected Names either on its own or in combination or association with any

other name.

29.2 Intellectual property of the Contractor .

29.2.1 The Contractor shall, in respect of all Intellectual Property that is owned by it, on termination

of this Agreement in accordance with its terms, grant to the User Entities User Entities a

non-exclusive, royalty free licence to use the Contractor’s Intellectual Property for the

Services, or any operational and maintenance services to be provided in the future by or for

the User Entities in relation to the Services (the "Permitted Purposes "). Those licences

shall be capable of being freely transferred by the Contract Owner to third parties at no cost,

for the Permitted Purposes, but to no other parties without the prior written consent of the

Contractor. . However the full import and effect of the provisions of this clause might have to

be discussed in more detail

29.2.2 In the event that any Intellectual Property is not owned by the Contractor but was specifically

developed for the Project, whether or not it is Licensed Intellectual Property, the Contractor

shall ensure that it is at all times entitled to-

29.2.2.1 grant to the User Entities a non-exclusive licence, on terms no less favourable than those

applicable to the Contractor, to use that Intellectual Property for the Permitted Purposes.

Those licences shall be capable of being further transferred by the Contract Owner to

third parties at no cost, for the Permitted Purposes; or

29.2.2.2 assign all of its rights in and to that Intellectual Property to the Contract Owner on the

basis that those rights shall be capable of being further assigned to third parties for the

Permitted Purposes. .

29.2.3 In the event that the Contractor uses any Intellectual Property owned by any third party in

the provision of Services, other than Intellectual Property which is the subject of clause

29.2.1, the Contractor shall prior to using any such Intellectual Property ensure the consent

of the relevant owner in order to ensure that the Contractor is at all times entitled to:

29.2.3.1 grant to the User Entities a non-exclusive licence, on terms no less favourable than those

applicable to the Contractor, to use that Intellectual Property for the Permitted Purposes,

which licences shall be capable of being further transferred by the User Entities to third

parties at no cost, for the Permitted Purposes; or

29.2.3.2 assign all of the Contractor’s rights in and to such Intellectual Property to the User

Entities, on the basis that those rights shall be capable of being further assigned by the

User Entities to third parties at no cost, for the Permitted Purposes.



29.2.4 If the owner of Intellectual Property contemplated in clause 29.2.3 withholds or denies such

consent, the Contractor shall not use any such Intellectual Property for the Services without

the prior written approval of the Contract Owner.

29.3 No aspect of the Services to infringe 3rd Party Int ellectual Property Rights . The

Contractor warrants that no aspect of the provision of Services in terms of this Agreement will

infringe any patent, design, copyright, trade secret or other proprietary right of any third party

("Third Party Proprietary Rights "), and the Contractor shall, at its cost, defend the User

Entities against any claim that the Services infringe any such Third Party Proprietary Rights,

provided that the relevant User Entity gives prompt notice to the Contractor of such claim and

the Contractor controls the defence thereof. The Contractor hereby further indemnifies the

User Entities against, and undertakes that it will pay all costs, damages and attorney fees, if

any, finally awarded against any User Entity in any action which is attributable to such claim

and will reimburse the relevant User Entities with all costs reasonably incurred by such User

Entities in connection with any such action.

29.4 Process in the event of a claim . Should any claim be made against a User Entity by any

person in terms of clause 29.2, the User Entity shall give the Contractor written notice thereof

within 10 (ten) days of becoming aware of such claim to enable the Contractor to take steps to

contest it. The provisions of clauses 20.5.2 to 20.5.4 shall apply mutatis mutandis in respect of

any claims made in terms of this clause 29.

29.5 Infringement of 3rd Party rights . Should any third party succeed in its claim for the

infringement of any Third Party Proprietary Rights, the Contractor shall, at its discretion and

within 30 (thirty) days of the Services having been found to infringe:-

29.5.1 obtain for the User Entities the right to continue using the subject of infringement or the parts

thereof which constitute the infringement; or

29.5.2 replace the subject of infringement or the parts thereof which constitute the infringement with

another product or service which does not infringe and which is materially similar to the

subject of infringement; or

29.5.3 alter the subject of infringement in such a way as to render it non infringing while still in all

respects operating in substantially the same manner as the subject of infringement; or

29.5.4 withdraw the subject of infringement.

30 DISPUTE RESOLUTION

The Contracting Parties accept that disputes may arise between them during the course of this

Agreement. Any dispute which cannot be resolved between the respective Service Managers shall

be dealt with in accordance with the Dispute Resolution Procedure.



31 BREACH & TERMINATION

Should the Contractor dispose of a material portion of its business, or should there be a change in

control in the Contractor (in which event the Contractor shall be deemed to be the Defaulting Party

and the Contract Owner, the Aggrieved Party) or should either Party ("the Defaulting Party "):-

31.1 commit a material breach of this Agreement, and fail to remedy such breach within 14 (fourteen)

days of having been called upon in writing by the other party ("the Aggrieved Party ") to do so;

or

31.2 be provisionally or finally wound up, whether voluntarily or compulsory; or

31.3 make any arrangement with its creditors, be financially distressed or any other circumstances

be present to justify business rescue under Chapter 6 of the Companies Act, 2008, or if it is

actually under business rescue or business rescue is pending, threatened against or any steps

have been taken, at any time, to commence business rescue against it under Chapter 6 of the

Companies Act, 2008;

31.4 receive a notice from the Companies and Intellectual Property Commission to show cause why

it should be permitted to continue to carry on its business, or trade or requesting it to cease

carrying on business or trading;

31.5 cease or threaten to cease to carry on its normal line of business in the Republic of South Africa

or default or threaten to default in the payment of its liabilities generally, be unable to pay its

debts as described in Section 345 of the Companies Act, 1973 (Act No 61 of 1973), or commit

any act or omission which would, in the case of an individual, be an act of insolvency in terms of

the Insolvency Act, 1936 (as amended); or

31.6 have any judgment granted against it (which is not subject to appeal or, if it is, such appeal is

not diligently pursued) or the passing of any resolution, for the dissolution and/or liquidation of

such Party except for the purposes of amalgamation or reconstruction on terms approved in

advance by the other Party in writing;

then the Aggrieved Party may, in its discretion, terminate this Agreement on written notice to the

Defaulting Party, in which event such termination shall be without prejudice to any claims which the

Aggrieved Party may have for damages against the Defaulting Party occasioned by the termination

of this Agreement in terms of this clause.

32 TRANSFER MANAGEMENT UPON TERMINATION

32.1 Transitional Arrangements . For a period of 60 (sixty) days prior the Expiry Date or, in the

case of any earlier termination, for the notice period contemplated in the relevant notice of

termination, the Contractor shall have the following obligations:

32.1.1 The Contractor shall co-operate fully with the Contract Owner and any successor providing

services to the User Entities in the nature of any of the Services or any part of the Services

in order to achieve a smooth transfer of the manner in which the User Entities obtain

services in the nature of the Services and to avoid or mitigate in so far as reasonably



practicable any inconvenience or any risk to the health and safety of the Staff of the City and

members of the public.

32.1.2 If the Contract Owner wishes to conduct a tender process with a view to entering into a

contract for the provision of services (which may or may not be the same as, or similar to,

the Services or any of them) following the Expiry Date or earlier termination of this

Agreement, the Contractor shall co-operate with the Contract Owner fully in such tender

process including (without limitation) by:

32.1.2.1 providing any information which the Contract Owner may reasonably require to conduct

such tender excluding any information which is commercially sensitive to the Contractor

(and, for the purposes of this sub-clause, commercially sensitive shall mean information

which would if disclosed to a competitor of the Contractor or subcontractor give that

competitor a competitive advantage over the Contractor or subcontractor and thereby

prejudice the business of the Contractor or subcontractor); and

32.1.2.2 assisting the Contract Owner by providing all (or any) participants in such tender process

with access on reasonable notice and at reasonable times to the workshops which are

leased from the Contract Owner.

32.2 Delivery of confidential information, data and prop rietary material . The Contractor shall

deliver to the Contract Owner, within 14 (fourteen) days of the date of termination of the

Agreement, all confidential information, data and other proprietary material of the User Entities

in its possession.

32.3 Authorities and other rights granted to the Contrac tor . All authorities and other rights

granted by the User Entities to the Contractor shall continue whilst the Contractor continues to

provide the Services in accordance with this clause 32, whereafter such authorities and other

rights shall automatically terminate.

32.4 Timeframe . The obligations of the Contractor in terms of clauses 32.2 shall be executed within

7 (seven) days of the effective date of termination of this Agreement, or such longer period as

the Contracting Parties may agree in writing.

33 FORCE MAJEURE

Performance of the obligations of any Contracting Party or Service Party in terms of this

Agreement shall be excused for as long as and to the extent that it is unable to do so because of

any cause beyond its control which was not reasonably foreseeable and for which it is not

responsible which, if qualifying as such shall include, without limitation, an act of God or state, or

war (whether declared or not) or sabotage, fire, flood, riot, downtime of any communication

infrastructure, governmental restriction, affecting the performance of such obligations, provided

that –

33.1 the party claiming such inability –



33.1.1 shall, when that party knows that it is likely to occur and when it occurs, immediately give

notice to the other party (which shall be confirmed in writing as soon as possible thereafter)

detailing the circumstances on which it relies and an estimate of the likely duration of such

inability; and

33.1.2 shall, when that party knows that such inability is likely to terminate and when it terminates,

immediately give notice thereof to the other Party, which shall be confirmed in writing as

soon thereafter as is possible;

33.2 the parties shall co-operate together and use all reasonable efforts to overcome, or failing

which, to minimise the effect of such inability;

33.3 if the Contractor is claiming such inability and the effect thereof has not been so overcome or

minimised to the satisfaction of the Contract Owner:

33.3.1 within a period of 7 (seven) days, then the Contract Owner may, but shall not be obliged, to

engage, at its own cost, one or more third parties to perform the obligations of the Contractor

hereunder affected by such inability which would otherwise have been performed in terms of

this Agreement by the Contractor, for only as long as and to the extent that the Contractor is

unable to perform the same;

33.3.2 within a period of 60 (sixty) days, then either Contracting Party may (as its sole remedy

therefor):-

33.3.2.1 to the extent that such inability relates to a particular User Entity, cancel this Agreement

in respect of the provision of Services to such User Entity forthwith by written notice;

33.3.2.2 to the extent that such inability relates to the entire Agreement, cancel the entire

Agreement forthwith by written notice;

provided that no Contracting Party or Service Party shall be liable for any damages arising out

of such termination;

33.4 neither Contracting Party hereto shall be obliged to subsequently perform any obligation

hereunder not performed as a consequence of and during any such inability, and the duration of

this Agreement shall not be extended as a consequence of any such inability;

33.5 the User Entities shall not be obliged to pay the Contractor to the extent that the Contractor

does not provide the Services during the period of any such inability (whether arising in respect

of any User Entities or the Contractor).

34 PERFORMANCE BOND

34.1 The Contractor to provide performance bond . In the event of any actual or perceived

material adverse risks arising subsequent to the Effective Date in respect of ability of the

Contractor to comply with the provisions of this Agreement, the Contract Owner shall consult

with the Contractor and may request the Contractor in writing to procure a performance bond

equal to no more than the aggregate amount payable by the User Entities to the contractor over

the preceding six months within 14 Business Days on terms acceptable to the Contract Owner,



which bond shall be provided by a registered South African financial institution reasonably

acceptable to the Contract Owner, for the due performance of the Contractor's obligations in

terms of this Agreement. It is recorded that the cost of this bond shall be charged by the

Contractor to the User Entities as a separate line item within the monthly User Entity billing on a

User Entity allocation basis which Contract Owner shall direct from time to time, or on any other

basis which the Contracting Parties may agree to in writing.

34.2 The Contractor to discharge all premiums. Notwithstanding the provisions of clause 34.1,

the Contractor shall be responsible for paying all premiums due in respect of the performance

bond in a timely fashion and shall provide the Contract Owner with proof of payment of all

premiums due within the period stipulated for payment thereof. Should the Contractor fail to

pay any such premium, such failure shall constitute a material breach of this Agreement,

entitling the Contract Owner either to:-

34.2.1 pay such premium itself. In such event the Contractor shall repay the Contract Owner the

amount of the premium within 3 (three) days of receiving written notice from the Contract

Owner demanding payment. Any amounts paid by the Contract Owner in terms of this

clause shall bear Penalty Interest from the date of payment of such amount by the Contract

Owner to the financial institution providing the performance bond ("the Issuer "); or

34.2.2 terminate this Agreement and exercise its rights in terms of the performance bond.

34.3 Renewal of Bond. Should the performance bond be issued on the basis that it is subject to

renewal on a periodic basis, the Contractor shall, no less than 60 (sixty) days prior to the

lapsing of the performance bond, procure that either:-

34.3.1 the issuer thereof agrees to extend the performance bond for a further period; or,

34.3.2 a new performance bond, on terms reasonably acceptable to the Contract Owner, is

executed in respect of the period subsequent to the lapsing of the then existing performance

bond.

34.4 Performance bond not in lieu of the Contract Owner' s rights . The performance bond shall

not be in lieu of the rights of the Contract Owner under this Agreement, but shall be in addition

to, supplementary to and without prejudice to such rights.

34.5 Review of amount of Bond . It is recorded that the Contract Owner may, in its discretion,

reduce the amount of the performance bond required.

35 NOTICES AND DOMICILIUM

35.1 Addresses . The Contracting Parties select as their respective domicilia citandi et executandi

the physical addresses set out on the cover sheet. Likewise the Contracting Parties choose all

the addresses set out on the cover sheet for the purposes of giving or sending any other notice

provided for or required hereunder, or such other address or fax number as may be substituted

by notice given as herein required.



35.2 Change of Address . Either Contracting Party may by giving written notice to the other by

hand, mail or by fax change its address details, provided that in respect of its physical address

and fax number, the new address or number, as the case may be, shall be in the Republic of

South Africa, and provided further that such change shall take effect fourteen 14 (fourteen)

days after delivery of such written notice.

35.3 Deemed Receipt . Any notice to be given by either Contracting Party to the other shall be

deemed to have been duly received by the other Contracting Party –

35.3.1 if addressed to the addressee at its domicilium and posted by pre-paid registered post, on

the 10th day after the date of posting thereof, or

35.3.2 if delivered to the addressee’s domicilium by hand during Business Hours on a Business

Day, on the date of delivery thereof, or

35.3.3 if sent by fax to the addressee on the first Business Day following the date of sending

thereof;

36 EXCLUSIVITY

36.1 Exclusivity . The Contract Owner hereby undertakes that all Category [��] Vehicles which are

operated by the User Entities shall, to the extent that they are taken on by the Contractor in

terms of the take-on procedure set out in Schedule 3 (Service Procedures) , be subject to

Vehicle Management Agreements and that no User Entity shall, in the absence of the breach of

this Agreement by the Contractor, utilise the services of any third party to provide services

which are substantially similar to the Services.

36.2 No minimum Fleet . Subject to the provisions of clause 36.1, it is expressly recorded that the

User Entities shall not be obliged to contract for a minimum number of Managed Vehicles under

this Agreement.

36.3 Compliance . The Contract Owner shall procure the compliance of all User Entities with this

clause 36.

37 NO PARTNERSHIP

Nothing in this Agreement shall be construed as creating a partnership between the Contracting

Parties and, save as expressly provided otherwise in terms of this Agreement, no Contracting

Party shall have any authority to incur any liability on behalf of any other or to pledge the credit of

any other Contracting Party.

38 ASSIGNMENT AND SUB CONTRACTING

38.1 Restriction on assignment or transfer of this Agree ment . Neither the Contract Owner nor

the Contractor shall be entitled to assign or otherwise transfer the benefit or burden of all or any

part of this Agreement without the prior written consent of the other Contracting Party, which

consent shall not be unreasonably withheld.



38.2 Right of the Contractor to sub-contract . The Contractor may sub-contract any of its

obligations in terms of this Agreement to a third party, provided that:-

38.2.1 such sub-contracting shall not absolve the Contractor from responsibility for achieving the

Service Levels or complying with its obligations in terms of this Agreement and the

Contractor hereby indemnifies and holds the User Entities harmless against any loss, harm

or damage which the User Entities may suffer as a result of such sub-contracting and for

which it would, but for the sub-contracting, be liable in terms of this Agreement;

38.2.2 such sub-contracting shall not have the effect of diluting or circumventing the provisions of

clause 5;

38.2.3 the Contractor shall at all times remain the sole point of contact for the User Entities in

respect of the acquisition of Services by the User Entities.

39 INTERPRETATION

This Agreement shall be subject to the following rules of interpretation.

39.1 Headings . Headings and sub-headings are inserted for information purposes only and shall not

be used in the interpretation of this Agreement.

39.2 References . Unless otherwise stated, references to:-

39.2.1 clauses, sub-clauses, schedules or paragraphs are to be construed as references to

clauses, sub-clauses, schedules or paragraphs of this Agreement. References in Schedules

to clauses shall, unless expressly provided otherwise, be deemed to be a reference to

clauses in such Schedule;

39.2.2 "this Agreement " shall refer to this Agreement as amended, varied, novated or substituted

in writing from time to time;

39.2.3 any other contract or document shall include (subject to all approvals required to be given

pursuant to this Agreement for any amendment or variation to or novation or substitution of

such contract or document) a reference to that contract or document as amended, varied,

novated or substituted from time to time;

39.2.4 a "person" shall include any "Responsible Authority" or any public or professional

organisation and shall include a reference to any of its successors or any organisation or

entity, which takes over its functions or responsibilities;

39.3 Enactments . References to the provisions of any law shall include such provisions as

amended, re-enacted or consolidated from time to time in so far as such amendment, re-

enactment or consolidation applies or is capable of applying to any transaction entered into

under this Agreement.

39.4 References to persons . References to:-



39.4.1 persons shall include an individual, firm, company, corporation, juristic person, Responsible

Authority, and any trust, organisation, association or partnership, whether or not having

separate legal personality;

39.4.2 any party shall, where relevant, be deemed to be references to, or to include, as appropriate,

their respective successors or permitted assigns;

39.4.3 the singular shall include the plural and vice versa;

39.4.4 any one gender shall include a reference to all other genders.

39.5 Substantive provisions . If any provision in a definition is a substantive provision conferring

rights or imposing duties on any party, notwithstanding that it is only in the definition clause,

effect shall be given to it as if it were a substantive provision in this Agreement.

39.6 Calculation of days . When any number of days is prescribed in this Agreement, same shall be

reckoned exclusively of the first and inclusively of the last day, unless the last day falls on a day

which is not a business day, in which case the last day shall be the next business day.

39.7 Definitions apply in Schedules . Expressions defined in clause 1 shall bear the same

meanings in the Schedules to this Agreement. Where any term is defined within the context of

any particular clause in this Agreement, the term so defined, unless it is clear from the clause in

question that the term so defined has limited application to the relevant clause, shall bear the

meaning ascribed to it for all purposes in terms of this Agreement, notwithstanding that the term

has not been defined in clause 1.

39.8 Approvals and consents . Where the approval or consent of any party is required in terms of

this Agreement, the parties hereby agree that such approval or consent shall not, unless

expressly provided to the contrary, be unreasonably withheld or delayed by the party who is

required to give same.

39.9 Neutral construction . The rule of construction that the Agreement shall be interpreted against

the party responsible for the drafting or preparation of the Agreement, shall not apply.

39.10 The term "including" . The words "include", "includes", and "including" means "include without

limitation", "includes without limitation", and "including without limitation". The use of general

words preceded or followed by words such as "other" or "including" or "particularly" shall not be

given a restrictive meaning because they are preceded or followed by particular examples

intended to fall within the meaning of the general words.

39.11 Common meaning . Terms other than those defined within the Agreement will be given their

plain English meaning, and those terms, acronyms, and phrases known in general commercial

or industry specific practice, will be interpreted in accordance with their generally accepted

meanings.

39.12 Use of email . The parties record that whilst they may correspond via email during the currency

of this Agreement for operational reasons, no formal notice required in terms of this Agreement,

nor any amendment or variation to this Agreement may be given or concluded via email.



40 GENERAL

40.1 Whole Agreement . This Agreement constitutes the entire agreement between the parties in

respect of the subject matter hereof and no party shall be bound by any undertakings,

representations, warranties or promises not recorded in this Agreement.

40.2 Waiver . No waiver of any of the terms and conditions of this Agreement will be binding or

effectual for any purpose unless expressed in writing and signed by the Contracting Party

hereto giving the same, and any such waiver will be effective only in the specific instance and

for the purpose given. No failure or delay on the part of any Contracting Party hereto in

exercising any right, power or privilege hereunder will operate as a waiver thereof, nor will any

single or partial exercise of any right, power or privilege preclude any other or further exercise

thereof or the exercise of any other right, power or privilege.

40.3 Severability . Should any of the terms and conditions of this Agreement be held to be invalid,

unlawful or unenforceable, such terms and conditions will be severable from the remaining

terms and conditions which will continue to be valid and enforceable. If any term or condition

held to be invalid is capable of amendment to render it valid, the Contracting Parties agree to

negotiate an amendment to remove the invalidity.

40.4 Non-solicitation . The Contractor shall not during the term of this Agreement offer any

employment, consultancy or other contract to a person:

40.4.1 who is an official of the City, any User Entity or any other municipal entity under the sole or

shared control of the City; or

40.4.2 who was such an official at any time during a period of one year before the offer is made.

40.5 Applicable Law . This Agreement will be governed by and construed in accordance with the

law of the RSA and all disputes, actions and other matters relating thereto will be determined in

accordance with such law.

40.6 Jurisdiction . Subject to clause 30, the Contracting Parties hereby consent and submit to the

jurisdiction of the South Gauteng High Court, Johannesburg, in any dispute arising from or in

connection with this Agreement.

40.7 Survival . Notwithstanding termination of this Agreement, any clause which, from the context,

contemplates ongoing rights and obligations of the parties, shall survive such termination and

continue to be of full force and effect.

40.8 Good Faith . The parties shall at all times during the currency of this Agreement owe each

other a duty of good faith.

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