20-F









Exhibit 4.43 


Confidential treatment requested as to
portions of this agreement, which were omitted and filed separately with the
Securities and Exchange Commission


FRAME PRODUCT AND SERVICE PURCHASE AGREEMENT


This Frame Product and Service Purchase Agreement (this “Agreement”) is entered into as of the
January 1, 2008,  (the “Effective
Date”) by and between Ituran Location and Control Ltd., a company
incorporated under the laws of the State of Israel having its principal place
of business at 26 Hamelacha St., Industrial Zone, Holon, Israel, (“Ituran”), and Telematics Wireless Ltd., a
company incorporated under the laws of the State of Israel having its principal
place of business at 26, Hamelacha Street, Holon Industrial Area, Holon, Israel
(“Telematics”) (each referred to
as a “Party” and collectively the “Parties”).


WHEREAS:


	
 

	
 


	
(A)

	
ST
Electronics (Info-Comm Systems) Pte Ltd. (“ST”)] has entered into a Share
Purchase Agreement dated ____ 2007 with Telematics, Ituran and certain other
individuals, pursuant to which ST has purchased more than 95% of the issued
share capital of Telematics (the “SPA”); and  


	
 

	
 


	
(B)

	
One of the
  conditions precedent to closing the SPA is the execution of this Agreement; 


	
 

	
 


	
(C)

	
Ituran
wishes to purchase from Telematics, and Telematics wishes to sell to Ituran,
certain Products (the “Products”) and certain services (the “Services”), as
listed in Annex A hereto, under the terms set forth herein;  


	
 

	
 


	
(D)

	
Telematics
  wishes to grant and Ituran wishes to receive a sub-license for Teletrac
  Systems and Technology as defined in Annex C attached hereto, for use in the
  Ituran Markets as defined in para. 8.1 herein;


	
 

	
 


	
(E)

	
Telematics
  wishes to receive a license from Ituran, and Ituran wishes to grant a license
  to Telematics, to use and sub-license the Ituran Technology and Know-how, as
  defined in Annex B attached hereto


	
 

	
 


	
(F)

	
Telematics
  wishes to purchase from Ituran, and Ituran wishes to sell to Telematics, the
  Ituran Products, including but not limited to software products, as described
  in Section 7.2, and the Ituran Services, including but not limited to the
  Teletrac system design and deployment related Services, as defined in section
  7.1 below.





***Confidential Treatment Requested









NOW, THEREFORE, the Parties hereto agree as
follows: 


	
 

	
 

	
 


	
1.

	
Orders, Prices and Payment


	
 

	
 

	
 


	
 

	
1.1

	
Throughout the Term, as defined in section 11.1 below, once every
calendar year and no later than the 31st August of each year,
Ituran shall provide Telematics with a binding minimum annual non-cancelable
frame order for Products, including but not limited to End Units and Base
Stations (both as defined in Annex A), for the following calendar year (a
“Frame Order”). The Frame Order will specify the aggregate number and type of
Product units being ordered. The Parties acknowledge that they have already
agreed on Ituran’s binding commitments for non-cancellable orders for the
year 2007, as set out in those certain purchase orders. 


	
 

	
 

	
 


	
 

	
1.2

	
Ituran shall
issue to Telematics binding non-cancellable written purchase orders (the
“Purchase Orders”), each Purchase Order covering a period of 3 (three) months
(the “Purchase Order Periods”), with each such Purchase Order Period
commencing four months following the date of its relevant Purchase Order (the
“Purchase Order Notice Periods”).  


	
 

	
 

	
 


	
 

	
 

	
Notwithstanding
  the foregoing, Telematics may, prior to any Purchase Order approval, reduce
  or increase any Purchase Order Period or Purchase Order Notice Period in
  accordance with its then current market requirements and raw material
  availability. Telematics shall accept any Purchase Order that materially
  conforms to the terms of this Agreement. Each Purchase Order must be approved
  in writing in advance by Telematics, and without derogating from the above,
  Telematics shall use commercially reasonable efforts to send written
  confirmation of such acceptance within 14 (fourteen) business days following
  Telematics’ receipt of a Purchase Order from Ituran.


	
 

	
 

	
 


	
 

	
 

	
Ituran shall
  be entitled to increase or decrease by up to 20% the quantities of products
  ordered under any purchase order delivered to Telematics by written notice of
  three (3) months prior to the delivery of the Products that were requested
  pursuant to such purchase order.


	
 

	
 

	
 


	
 

	
 

	
Telematics
  undertakes that it will maintain sufficient inventory at all times to ensure
  the availability of Products to Purchaser in accordance with the terms of
  this Agreement. 





***Confidential Treatment Requested










	
 

	
 

	
 


	
 

	
 

	
Telematics
  undertakes that it shall obtain from Ituran written approval prior to any
  change in the specifications of any Product.


	
 

	
 

	
 


	
 

	
 

	
The
  aggregate number of Products covered by the Purchase Orders for each calendar
  year must reach at least the minimum number of Products stated in the Frame
  Order for such year, provided that Ituran shall have a grace period of one
  calendar quarter in which to correct any failure to reach such minimum Frame
  Order. For the avoidance of any doubt, any Products delivered in such grace
  period will be in addition to, and will not reduce, the quantities of units
  ordered, or to be ordered, under the Frame Order for the following year.


	
 

	
 

	
 


	
 

	
 

	
Telematics
  will be entitled to utilize to the maximum Obsolete Parts, as defined below,
  and Ituran is committed to buy Products incorporating such Obsolete Parts, or
  to buy such Obsolete Parts. 


	
 

	
 

	
 


	
 

	
 

	
“Obsolete
Parts” shall mean (i) any existing inventory parts that were purchased by
Telematics prior to the Effective Date in order to supply previous generation
products or versions of products before their replacement with next
generation products or versions of products, or (ii) any inventory parts,
regardless of the date of purchase by Telematics, the supply of which is
stopped or declared to be stopped by Telematics’ relevant suppliers or
manufacturers, which were purchased by Telematics according to a plan,
negotiated and agreed in good faith between the Parties to secure further
production by Telematics of the Products in excess of the relevant Frame
Order and Purchase Order.  


	
 

	
 

	
 


	
 

	
1.3

	
Frame Orders
  and Purchase Orders will cover Products ordered by Ituran from vendors
  licensed by Telematics to manufacture and supply the Products as well as from
  Telematics itself, provided that the Purchase Orders issued to such vendors
  will be separate from the Purchase Orders issued to Telematics itself. Any
  Purchase Orders to such vendors shall be taken into account when determining
  whether Ituran has reached the minimum number of Products that Ituran is
  obligated to purchase pursuant to the Frame Order for the specific year.


	
 

	
 

	
 


	
 

	
Ituran will
  order Services through separate non-cancellable purchase orders.


	
 

	
 

	
 


	
 

	
1.4

	
Notwithstanding
  any other provision contained herein, Ituran shall purchase hereunder a
  minimum of *** End Units, as defined in Annex A to be delivered during the
  period from January 2008 to January 2011 (the “Initial End Units”). As prescribed in Section 1.5 below,
  prices of the Initial End Units shall be fixed for every quarterly purchase
  order and shall be based on the consideration specified in Annex A.





***Confidential
Treatment Requested










	
 

	
 

	
 


	
 

	
1.5

	
Telematics shall sell the Products and Services to Ituran and
  Ituran’s subsidiaries at the prices specified in Annex A (the
  “Consideration”). All prices are FOB/FCA, as applicable, Telematics, Holon,
  Israel. At the end of each calendar year, the parties shall examine the total
  number of Products and Services sold by Telematics in said year and in the
  event that it is found that Ituran purchased such number of products in that
  year that would entitle either party, in accordance with Annex A, to a
  refund, then such refund shall be paid within thirty (30) days following the
  end of year, or set off against future payments to be made by Ituran, as
  shall be instructed in writing by Ituran.


	
 

	
 

	
 


	
 

	
 

	
Annex A shall contain the direct manufacturing cost of all Products
  as of the Effective Date.


	
 

	
 

	
 


	
 

	
 

	
Subject to
  the foregoing sentence, the Consideration will be updated by Telematics once
  every calendar quarter commencing three months after the Closing, in
  accordance with Telematics’ manufacturing costs of the Products. In the event
  that Telematics advises Ituran of an increase or decrease in Telematics’
  manufacturing costs of the Products, Ituran shall be entitled, at its own
  expense, to request and receive a report from an independent auditor,
  appointed by Ituran, the identity of which will be agreed between the parties
  (and if no agreement is reached within 7 business days, then the identity
  will be chosen by the President of the Israeli Association of Certified
  Public Accountants) regarding Telematics’ manufacturing costs for the
  Products, provided that such request may only be made once every calendar
  quarter and Telematics will provide such auditor with details of the
  breakdown of the manufacturing costs and increase or decrease thereof and all
  information related thereto. The Products for the Israeli market shall be
  produced in Israel by manufacturers that have been selected and approved by
  Telematics


	
 

	
 

	
 


	
 

	
 

	
***


	
 

	
 

	
 


	
 

	
 

	
If during
  the term of this Agreement prices are changed in accordance with the terms
  hereof, such new prices shall apply to all Purchase Orders and Service
  purchase orders issued by Ituran after the effective date of such new prices.


	
 

	
 

	
 


	
 

	
1.6

	
***. Until such time as manufacturing for supply in Brazil is
  transferred to Brazil pursuant to Section 1.11 below, in the case of sea
  shipments or air deliveries to Brazil the first payment will be due at end of
  the month in which the first such shipment or air delivery has arrived at a
  Brazilian sea port or airport, as applicable. In such cases, Telematics will
  on the date of each shipment or air delivery notify Ituran of such shipment
  or air delivery, and the other 3 (three) payments will be made in the
  following three consecutive months.





***Confidential Treatment Requested










	
 

	
 

	
 


	
 

	
1.7

	
The
  Consideration does not include, and Ituran shall pay, any taxes and fees
  required by any applicable law in connection with this Agreement, including,
  without limitation, value added tax and any other taxes and fees relating to
  sale or use of the Products or Services, save that taxes measured by Telematic’s net income or assets and business and
  occupation taxes shall be the sole responsibility of, and payable by,
  Telematics. Ituran shall include such
  taxes with payment or shall provide Telematics with the appropriate
  certificate of exemption of withholding tax or other documentation to support
  exemption from such tax. Furthermore, the Consideration is exclusive of
  applicable freight and insurance charges and duties, which shall be the sole
  responsibility of, and payable by, Ituran. 


	
 

	
 

	
 


	
 

	
1.8

	
Ituran shall be solely responsible for any and all base station
royalties that may be due to Teletrac, Inc. (“Teletrac”) as a result of the
sale of the Products hereunder. Without derogating from the generality of the
foregoing, Ituran shall pay such royalties only with respect to the Products
purchased by Ituran or any of Ituran’s direct and indirect
subsidiaries (the “Ituran Group”), either
prior to or following the Effective Date, save for any royalties in respect
of base stations erected in Korea and the Republic of China.  


	
 

	
 

	
 


	
 

	
 

	
Telematics acknowledges and warrants that it will act with accordance
  with the provisions of the Teletrac Agreement. 


	
 

	
 

	
 


	
 

	
1.9

	
All payments
  hereunder shall be made in US$ (US Dollars) unless otherwise agreed by the
  parties in advance and shall be transferred per telegraph/wire transfer to an
  account number designated by Telematics.


	
 

	
 

	
 


	
 

	
1.10

	
For the purposes of the Israeli Ministry of Trade and Industry,
  Ituran will record in its books Telematics as the export beneficiary for any
  Product manufactured by Telematics or on its behalf sold to Ituran’s overseas
  subsidiaries or related parties.


	
 

	
 

	
 


	
 

	
1.11

	
Manufacturing
  in Brazil








	
 

	
 

	
 


	
 

	
1.11.1

	
Telematics
  further undertakes that the manufacturing of End Units to be used and/or
  installed in Brazil, shall be manufactured by or on behalf of Telematics in
  Brazil (the “Setup”), provided that such Setup ensures the collection by
  Telematics of the full Considerations per product, excluding (a) taxes, duties
  and fees, payable by Ituran, that are imposed, by any Brazilian authority, on
  such Setup (b) The lower of: 1. *** per year or 2. Cost of engineering
  support by Telematics to the Brazilian manufacturer incurred by Telematics.


	
 

	
 

	
 


	
 

	
1.11.2

	
***





***Confidential Treatment Requested











	
 

	
 

	
 


	
2.

	
Shipment and Delivery


	
 

	
 

	
 


	
 

	
2.1

	
***, as applicable (port of shipment/air delivery), (Incoterms 2000).
  Accordingly, title and risk of loss or damage shall pass from Telematics to
  Ituran upon Telematics’ loading of the Products onto the ship at the port of
  shipment or on to the plane at the port of air delivery. Telematics will bear
  all expenses related to packing, loading and delivery of Products to the
  designated ship or plane, and loading of Products onto the ship or plane.


	
 

	
 

	
 


	
 

	
 

	
*** (Incoterms 2000).


	
 

	
 

	
 


	
 

	
2.2

	
Telematics shall preserve, package, handle, and pack Products so as
  to protect them from loss or damage, in conformance with good commercial
  practice.


	
 

	
 

	
 


	
 

	
2.3

	
Each delivery of Products to Ituran shall include a packing list that
  contains (i) the Purchase Order number; (ii) the quantity of Products
  shipped; and (iii) the date of shipment. Packaging of the
  products shall be in accordance with the current Telematics standards. Any
  change from said standards will be submitted to Ituran for approval.


	
 

	
 

	
 


	
3.

	
Upgrades, Developments and Adaptations


	
 

	
 

	
 


	
 

	
3.1

	
Telematics
will use commercially reasonable efforts to comply with any requests by
Ituran to perform any Product upgrades, developments or customizations for
any members of the Ituran Group or any of their customers (“Telematics
Upgrades”), and in such circumstances Ituran shall fully reimburse Telematics
for the cost of the non-recurring engineering (“NRE”), and tooling costs, and
any other costs of the Telematics Upgrades. Telematics shall provide details
of such costs. The costs of NRE will be computed in accordance with a Tariff,
specified in Annex A.. Without derogating from the aforesaid, Telematics
undertakes to make commercially reasonable efforts to correct immediately and
without further delay any errors and/or bugs and/or malfunction of the
Products, based on Ituran’s written complaints, which are related to design
and/or manufacturing. As part of the NRE, Telematics will develop and supply
to Ituran the necessary tools in order to examine the proper functionality of
the Product.  





***Confidential
Treatment Requested










	
 

	
 

	
 


	
 

	
3.2

	
Ituran will
  use commercially reasonable efforts to comply with any requests by Telematics
  to perform for Telematics’ customers customizations and adaptations of the
  Ituran Technology, Ituran Products or the Teletrac Systems and Technology or
  applicable components of any of the foregoing, (collectively, the “Ituran
  Adaptations”), and in such circumstances Telematics shall fully reimburse
  Ituran for NRE costs of such Ituran Adaptations, details of such costs to be
  provided and invoiced by Ituran to Telematics. The costs of NRE will be
  computed in accordance with a Tariff specified in Annex B.. Ituran shall
  provide Telematics with the monthly number of hours of availability of its
  staff in order to provide the Ituran Adaptations. To avoid any doubt, Ituran
  hereby commits to make available the required resources and personnel to
  support a minimum of two (including further extension of the existing
  Metropolitan deployments) new metropolitan deployments per year.








	
 

	
 

	
 


	
 

	
 

	
Without
  derogating from the aforesaid, Ituran undertakes to make commercially
  reasonable efforts to correct immediately and without further delay any
  errors and/or bugs and/or malfunction of the Ituran Technology and Know-how,
  Ituran Products or the Teletrac Systems and Technology or applicable
  components of any of the foregoing, based on Telematics’ written complaints,
  which are related to design and/or manufacturing. 


	
 

	
 

	
 


	
 

	
3.3

	
Subject to
  Section 6.4 below, Ituran will make available, at no cost, to Telematics and
  Telematics will make available at no cost to Ituran, all upgrades and
  developments made to their respective products whether for their own use or
  for use by their other customers (ie. upgrades and developments performed
  other than at the request of Telematics or Ituran, as applicable).


	
 

	
 

	
 


	
 

	
3.4

	
All
  Products, Services, Telematics Upgrades and any other Telematics upgrades and
  developments and all rights therein, including all intellectual property
  rights, shall be the sole and exclusive property of Telematics, and Ituran
  will sign a confidentiality agreement in the form attached hereto as Annex D.
  


	
 

	
 

	
 


	
 

	
 

	
All Ituran
  Products, Ituran Adaptations, any other Ituran developments and Ituran’s
  Technology and Know-how and all rights therein, including all intellectual
  property rights, shall be the sole and exclusive property of Ituran, and
  Telematics will sign a confidentiality agreement in the form attached hereto
  as Annex D.





***Confidential Treatment Requested










	
 

	
 

	
 


	
 

	
3.5

	
Any dispute
  relating to the amount of NRE costs under the above sections 3.1 or 3.2 will
  be settled by an independent arbitrator, the identity of whom will be agreed
  by the Parties and, in the event that no such agreement is reached, as
  appointed by the President of the Israel Association of Certified Public
  Accountants, the costs of such arbitration to be borne solely by Ituran in
  the case of arbitration under section 3.1, and solely by Telematics in the
  case of arbitration under section 3.2, regardless in either case of the
  arbitration’s outcome.


	
 

	
 

	
 


	
 

	
3.6

	
Effective upon payment in full of the NRE and other costs specified
  in Section 3.1 above, Telematics will grant Ituran an irrevocable license to
  use the Telematics Upgrades for Ituran’s customers in Ituran Markets, as
  defined in section 8.1, at no additional charge.


	
 

	
 

	
 


	
 

	
3.7

	
Effective upon payment in full of the NRE costs specified in Section
  3.2 above, Ituran will grant Telematics an irrevocable license to use the
  Ituran Adaptations for Telematics’ customers in Telematics Markets, as
  defined in section 8.2.2, for no additional charge.


	
 

	
 

	
 


	
4.

	
Warranties


	
 

	
 

	
 


	
 

	
4.1

	
Telematics warrants that all Products and Services (i) shall conform
  strictly to any design criteria, specifications, descriptions, drawings,
  samples, and any other requirements referred to in the relevant Purchase
  Order; (ii) with respect to Products, shall be free from defects in design,
  material, and workmanship; (iii) shall be free of all liens, encumbrances,
  and other claims against title; (iv) do not infringe any patent, trademark,
  copyright or other intellectual property right of a third party; (v) with
  respect to Products, are new and do not contain any used or reconditioned
  parts or materials; and (vi) with respect to Services, will be performed in a
  professional manner consistent with the prevailing standards of care and
  skill. Other than the express warranties specified in this
  section 4.1, Telematics makes no warranties or representations regarding the
  Products or Services.


	
 

	
 

	
 


	
 

	
4.2

	
All warranties specified in the above section 4.1 (i to v) shall
  survive any inspection, delivery, acceptance, or payment by
  Ituran, and shall be in effect for a *** following the date of delivery by
  Telematics of the Products or Services, as applicable. 


	
 

	
 

	
 


	
 

	
4.3

	
Ituran warrants that (i) the Ituran Products and Services shall
  conform strictly to any design criteria, specifications, descriptions,
  drawings, samples, and other requirements referred to in the relevant
  Telematics purchase order; (ii) with respect to the Ituran Products and
  Ituran Technology, shall be free from defects in design, material, and
  workmanship; (iii) with respect to the Ituran Products and Ituran Technology
  shall be free of all liens, encumbrances, and other claims against title;
  (iv) with respect to the Ituran Technology and the Ituran Products, do not
  infringe any patent, trademark, copyright or other intellectual property
  right of a third party; (v) with respect to the Ituran Products, are new and
  do not contain any used or reconditioned parts or materials; and (vi) with
  respect to the Ituran Services, will be performed in a professional manner
  consistent with the prevailing standards of care and skill. Other
  than the express warranties specified in this section 4.3, Ituran makes no
  warranties or representations regarding the Ituran Technology and Know-how,
  the Ituran Products or the Ituran Services.





***Confidential Treatment Requested










	
 

	
 

	
 


	
 

	
4.4

	
All warranties specified in section 4.3(i), (ii), (iii), (iv) and (v)
  shall survive any inspection, delivery, acceptance, or payment
  by Telematics, and shall be in effect for *** following the date of delivery
  by Ituran of the Ituran Products or the Ituran Services, as applicable. 


	
 

	
 

	
 


	
5

	
Non-Complying Products, Services, Ituran Products, Ituran Services
  and Ituran Technology and Know-how 


	
 

	
 

	
 


	
 

	
5.1

	
If any
Products are defective or otherwise not in conformity with the requirements
of a Purchase Order (the “Non-Complying Products”), Ituran may return the
Non-Complying Products for repair or replacement at Telematics’ expense. If
any Services are defective or otherwise not in conformity with the
requirements of a Services purchase order (the “Non-Complying Services”),
Ituran may require Telematics to rectify the non-compliant Services at
Telematics’ expense.  


	
 

	
 

	
 


	
 

	
 

	
Ituran acknowledges that the warranty contained in Section 4.1 shall
  not apply to damage, deterioration or malfunctions which, after passage of
  title to Ituran, are caused by:








	
 

	
 

	
 

	
 


	
 

	
 

	
a)

	
The improper removal or installation of Products or components
  thereof, performed not according to the agreed upon procedure;


	
 

	
 

	
 

	
 


	
 

	
 

	
b)

	
Accidents, acts of nature, misuse, abuse, negligence, neglect,
  unauthorized product malfunction or failure to follow proper instruction
  procedure by Ituran; or


	
 

	
 

	
 

	
 


	
 

	
 

	
c)

	
Repair or attempted repair by any person not authorized by
  Telematics.








	
 

	
 

	
 


	
 

	
 

	
Any Products
  or Services repaired or furnished in replacement shall, from the date of
  delivery of such corrected or replaced Products or Services, be subject to the
  provisions of Sections 4.1 and 4.2 for the remaining period of the warranty
  period for the original Non-Complying Products or Non-Complying Services.





***Confidential Treatment Requested










	
 

	
 

	
 


	
 

	
 

	
During the
  warranty period described in the above Section 4.2, Telematics undertakes to
  repair or replace any Non-Complying Product or Non-Complying Service within
  three (3) months from the date of receipt of the Non-Complying Product or
  Non-Complying Service, as applicable. 


	
 

	
 

	
 


	
 

	
 

	
The warranties contained in this Section 5.1 are in lieu of all other
  warranties whether oral, written or express, implied or statutory. Except as
  mentioned above in this Section 5.1, Telematics will have no other liability
  with respect to Non-Complying Products or Non-Complying Services. Without
  derogating from the generality of the foregoing, Telematics will not be
  responsible for any other costs, expenses or expenditure incurred by Ituran,
  including but not limited to any costs arising from de-installation of any
  Non-Complying Product or any part thereof or the re-installation of any
  Product or any part thereof.


	
 

	
 

	
 


	
 

	
5.2

	
If Ituran returns Non-Complying Products in accordance with section
  5.1 above, Telematics shall return the repaired Non-Complying Products or
  replacement thereof no later than, with respect to End Units, 90 days
  following Telematics’ receipt of the Non-Complying Products from Ituran, and,
  with respect to Base Stations equipment, 30 days following such receipt. 


	
 

	
 

	
 


	
 

	
 

	
Notwithstanding any of the foregoing, Ituran shall only be entitled
  to send Non-Complying Product End Units in minimum quantities of 500 End
  Units per request


	
 

	
 

	
 


	
 

	
 

	
Furthermore and for the avoidance of any doubt, in the event that
  Ituran returns Products that are found by Telematics not to be Non-Complying
  Products, Telematics will not be liable in any way and Ituran will reimburse
  Telematics for all costs incurred by Telematics related to such return of
  Products.


	
 

	
 

	
 


	
 

	
5.3

	
If the Ituran
  Products are defective or otherwise not in conformity with Telematics’
  relevant purchase order or requirements (the “Non-Complying Ituran Technology and Ituran Products”),
  Telematics may return the Non-Complying Ituran Products, for repair or
  replacement at Ituran’s’ expense. If any Ituran Services or Ituran Technology
  are defective or otherwise not in conformity with Telematic’s relevant
  purchase order or requirements (the “Non-Complying
  Ituran Services”), Telematics may require Ituran to correct the
  Ituran Services or Ituran Technology at Ituran’s expense. 





***Confidential Treatment Requested










	
 

	
 

	
 


	
 

	
 

	
Any Ituran
  Products or Ituran Services repaired or furnished in replacement shall, from
  the date of delivery of such corrected or replaced Ituran Products or Ituran
  Services, be subject to the provisions of Sections 4.3 and 4.4 for the same
  period and to the same extent as the Ituran Products or Ituran Services
  initially furnished pursuant to the relevant Telematics purchase order or requirements. 


	
 

	
 

	
 


	
 

	
5.4

	
If Telematics returns Non-Complying Ituran Products in accordance with
  section 5.3 above, Ituran shall return the repaired Non Complying Ituran
  Products or replacement no later than three (3) months following Ituran’s
  receipt from Telematics of the Non-Complying Ituran Products. Any
  Ituran Products or Ituran Services repaired or furnished in replacement
  shall, from the date of delivery of such corrected or replaced Products or
  Services, be subject to the provisions of Sections 4.3 and 4.4 for the
  remaining period of the warranty period for the original Non-Complying Ituran
  Products or Non-Complying Ituran Services.


	
 

	
 

	
 


	
6.

	
Licenses and Escrow Arrangements


	
 

	
 

	
 


	
 

	
6.1

	
Three months following the Effective Date, Telematics will, at
  Ituran’s sole expense, deposit a copy of the Product Production Files, as
  detailed in Annex A with an independent escrow agent, the identity of whom
  will be agreed between the Parties (and in the event that no such agreement
  is reached, will be appointed by the President of the Israel
  Association of Certified Public Accountants), and Telematics will keep such files up to date. Should (i)
  Telematics discontinue its support of any Product; or (ii) Telematics
  terminates the manufacture or distribution of any Product, required and/or
  may be required by Ituran, unless the Product is replaced by another product
  with similar functionality, (iii)
  Telematics becomes subject to insolvency proceedings that are not terminated,
  rejected or revoked within 14 (fourteen) business days of their commencement;
  or (iv) Telematics otherwise is unable to manufacture any Product or deliver
  such Product on the Delivery Date as per the Purchase Order and if no more
  than 3 months after the date when such case becomes known to Telematics and
  Telematics can not prove that it is able to rectify the situation in
  additional 3 months, provided that external arbitrator will decide that
  Ituran will be able to rectify the situation faster than Telematics, or
  (v) Telematics otherwise ceases its business and operations, or (vi) upon
  expiration of this Agreement Telematics is unwilling to continue production
  and support of any Product for Ituran, then
  Ituran will be granted access to the relevant portion of the escrowed
  production files solely for the purpose of enabling Ituran to, (A)
  manufacture the Products for its current and future customers and (B) service
  its current and future customers. The
  release of the Production file from Escrow per this section 6.1 refers only
  to the specific Product which is subject to the conditions described above in
  this section.





***Confidential Treatment Requested










	
 

	
 

	
 


	
 

	
6.2

	
The escrow arrangements described in Section 6.1 above will be
further detailed in escrow agreements in the form attached hereto as Annex
E.  


	
 

	
 

	
 


	
 

	
6.3

	
Ituran shall transfer to Telematics the Ituran Technology and
Know-how and the Ituran Products and shall provide Telematics with relevant
training for use of the Ituran Technology and Know-how and the Ituran
Products (“Ituran Technology Transfer”) to Telematics personnel to enable
Telematics to independently deploy, maintain, and operate the Teletrac
System, the Ituran Technology and Know-how and the Ituran Products. Ituran
shall assist Telematics to fully document the Ituran Technology and Know-how
and the Ituran Products. The said documentation will be equally available to
both parties. Telematics shall bear the technical writing expenses and each
party shall bear its own personnel costs and expenses related to the Ituran
 Technology Transfer. Notwithstanding anything of the contrary Ituran
Technology Transfer shall not include software source codes.  


	
 

	
 

	
 


	
 

	
6.4

	
Ituran shall grant Telematics a perpetual, exclusive, worldwide
  (except for the territories listed in the Ituran Market as defined in Section
  8.2.1 below) license to use, reproduce, display, distribute and sub-license,
  including directly or by way of integration into any Telematics products and
  services, the Ituran Products and the Ituran Technology and Know-how and any
  other related technology provided by Ituran, and all future developments of
  any segments of the Ituran Products and Ituran Technology and Know-how.
  Telematics will pay to Ituran consideration for the use of Ituran license as
  specified in the attached Annex B paragraph 2. 


	
 

	
 

	
 


	
 

	
6.5

	
Subject to and to the extent permitted under the License Agreement
dated 13th July 2004, between Teletrac and Telematics (the
“Teletrac Agreement”), Telematics hereby grants Ituran a non-exclusive,
perpetual license to market and sell the Teletrac Systems and Technology in
Ituran’s Markets, as defined in section 8.2.1 below. Telematics agrees that it
will not sub-license the right to market and sell the Teletrac Systems and
Technology to any party other than Ituran in the Ituran Markets  


	
 

	
 

	
 


	
 

	
 

	
The said license will be royalty free, save that immediately upon
  Telematics’ written demand, Ituran will fully reimburse Telematics for any
  royalties, license fees or other payments due to Teletrac as a result of the
  sub-license to Ituran under this Section 6.5, including but not limited to
  any payments required to be paid by Telmatics pursuant to Section 8 of the
  Teletrac Agreement. 





***Confidential Treatment Requested










	
 

	
 

	
 


	
 

	
6.6

	
Subject to Section 1.8 second paragraph, Telematics makes absolutely
  no warranties, express or implied, with respect to the Teletrac Systems and
  Technology or any part thereof, including but not limited to its components,
  software and technical information. By way of example, but not of limitation,
  Telematics makes no warranty of merchantability or fitness for a particular
  purpose or warranty that the Teletrac Systems and Technology, or any part
  thereof, is error-free or that its use will be uninterrupted or that the
  Teletrac Systems and Technology will be a profitable enterprise for Ituran. 


	
 

	
 

	
 


	
 

	
 

	
Telematics expressly disclaims the making of, and Ituran acknowledges
  that it has not received or relied upon, any guarantee or representation,
  express or implied, as to the feasibility of operation of the Teletrac
  Systems and Technology in any territory, as to Ituran’s ability to design,
  construct, operate or maintain the Teletrac Systems and Technology in any
  territory or as to the costs Ituran may incur or the revenues it may receive
  with respect to the Teletrac Systems and Technology in any territory. Ituran
  further acknowledges that it has no knowledge of any representations by any
  officer, employer or agent of Telematics that are contrary to this Section
  6.6.


	
 

	
 

	
 


	
7.

	
Ituran Services








	
 

	
 

	
 


	
 

	
7.1

	
Throughout
the Term, Ituran shall provide Telematics with the services as listed in the
attached Annex B (the “Ituran Services”).  


	
 

	
 

	
 


	
 

	
 

	
Ituran shall
  provide Telematics free of charge with copies of all relevant documentation
  in its possession related to the Ituran Products and the Ituran Technology and Know-how, and to the Teletrac
  Systems and Technology for Telematics’ use of the foregoing in accordance
  with this Agreement.


	
 

	
 

	
 


	
 

	
 

	
In
  consideration for the Ituran Services, Telematics will pay fees to Ituran in
  accordance with Annex B attached hereto. 


	
 

	
 

	
 


	
 

	
7.2

	
The Ituran
  Products are those products listed in Annex B attached hereto. In consideration
  for any Ituran Products purchased by Telematics, Telematics will pay the
  prices as listed in Annex B.


	
 

	
 

	
 


	
 

	
 

	
Ituran shall grant Telematics an exclusive, perpetual, worldwide
  license to use, reproduce, display, distribute and sub-license, including directly
  or by way of integration into any Telematics products and services, the
  Ituran Products and Ituran Technology and Know-how and any other related
  technology and know how provided by Ituran, and all future developments of
  any segments of the Ituran Products in the Telematics Markets as defined in
  section 8.2.2 below. 





***Confidential Treatment Requested










	
 

	
 

	
 


	
8

	
Exclusivity, Non-Compete and Confidentiality


	
 

	
 

	
 


	
 

	
8.1

	
Products and
  Services


	
 

	
 

	
 


	
 

	
 

	
Throughout
  the Term and in Ituran Markets as defined hereunder, Ituran and all members
  of the Ituran Group will purchase Products and Services and any other
  products and services utilizing any RF location technology compatible to
  Teletrac System as defined in Annex C exclusively from Telematics and
  Telematics will sell Products and Services and any other products and
  services utilizing any RF location technology compatible to Teletrac System
  as defined in Annex C exclusively to Ituran. 


	
 

	
 

	
 


	
 

	
 

	
For the
  purpose of this section 8.1, “Ituran
  Markets” shall mean: ***


	
 

	
 

	
 


	
 

	
8.2

	
Worldwide
  Teletrac Systems and Technology marketing rights


	
 

	
 

	
 


	
 

	
 

	
Neither
  Party shall compete with the other Party for Teletrac Systems and Technology
  or similar RF terrestrial location systems and technology in the other
  party’s exclusive markets/territories as defined below: 








	
 

	
 

	
 

	
 


	
 

	
8.2.1

	
The
  Ituran Markets 








	
 

	
 

	
 


	
 

	
 

	
For the
purpose of this section 8.2, “Ituran Markets” shall mean: *** 


	
 

	
 

	
 


	
 

	
 

	
Ituran will
  invite Telematics to participate in any operating company that Ituran will
  establish in Ituran Markets based on Teletrac Technology.


	
 

	
 

	
 


	
 

	
 

	
If Ituran
  will enter one of the Itruran Markets with different location technology than
  Teletrac technology, and within 6 month thereafter shall not order Telematics
  Products for this market, Ituran exclusivity with regard to this market will
  lapse.








	
 

	
 

	
 

	
 


	
 

	
8.2.2

	
Telematics
  Markets








	
 

	
 

	
 


	
 

	
 

	
“Telematics Markets” are hereby defined as
  all markets and territories that do not fall within the definition of Ituran
  Markets in section 8.2.1 above, subject to the Teletrac Agreement. The
  Telematics Markets are exclusive to Telematics.






	
 

	
 

	
 


	
 

	
-

	
***




***Confidential Treatment Requested













	
 

	
 

	
 

	
 


	
 

	
 

	
8.2.3.

	
If
  either party receives from Teletrac a license for additional markets, ***
  shall be added to Ituran Markets and *** shall be added to Telematics
  Markets.


	
 

	
 

	 	
 


	
 

	
 

	
8.2.4

	
If
either party (the “First Party”) reach an agreement with a third party who
posses an adequate spectrum license and all other permits as needed in the
other party territory, the other party (the “Purchaser”) shall be entitled to
purchase (the “Acquisition Right”) up to 50.1% of the operating entity in the
said territory (whether such operating entity is incorporated by the First
Party or is a joint venture with a local customer or otherwise (the
“Operating Entity”), for a consideration based on the actual costs and
expenses incurred by such Operating Entity as of the date of the Notice, as
defined below. The Acquisition Right shall be exercised by the Purchaser
within forty five (45) days following receipt of written notice (the
“Notice”) from the First Party giving Notice of such agreement in a certain
territory, specifying all details of the Operating Entity, as reasonably
requested by the Purchaser. It is hereby clarified that the Acquisition Right
of the Purchaser shall be incorporated and a condition to the effectiveness
of any contract entered between the First Party and the Operating Entity in
the territory, including any third parties.  


	
 

	
 

	 	
 


	
 

	
8.3

	
Except as required for each Party’s performance of this Agreement,
  neither Party shall use or disclose any Confidential Information obtained
  from the other Party or otherwise prepared or discovered by either Party and
  shall protect the confidentiality of Confidential Information with the same
  degree of care as such Party uses for its own similar information, but with
  no less than reasonable care. Confidential Information includes, without
  limitation, all information designated by the disclosing Party as
  confidential, all information or data concerning the Products and Services
  (including the discovery, invention, research, improvement, development,
  product plans, manufacture or sale thereof) or the disclosing Party’s general
  business operations (including strategies, customers, costs, forecasts, profits,
  pricing methods, and processes), and any information which, if not otherwise
  described above, is of such a nature that a reasonable person would believe
  it to be confidential. 


	
 

	
 

	 	
 





***Confidential Treatment Requested










	
 

	
 

	
 


	
9.

	
Liability


	
 

	
 


	
 

	
Subject to
  Sections 1.8, 6.5 and 10 herein, in no event shall either party’s liability
  arising out of, or in connection with, this Agreement exceed the
  consideration paid by the other party under the relevant purchase order
  relating to those products or services causing the damage. For the avoidance
  of any doubt, the said limitation of liability will not apply to the
  liability of either party arising from Sections 1.8, 6.5 and 10 herein.


	
 

	
 


	
 

	
Also, for
  the avoidance of any doubt, the said limitation of liability will not apply
  to the liability of Ituran arising from sections 3.2, 3.3, 3.7, 6.3, 7 and 8
  with regards to the markets in China, Korea which Telematics has committed to
  deploy the Teletrac System with prior consent of Ituran, provided however
  that in the said markets, Ituran’s liability shall no exceeds_500,000$per
  country. 


	
 

	
 


	
 

	
IN NO EVENT SHALL EITHER
  PARTY BE LIABLE FOR ANY CONSEQUENTIAL, INCIDENTAL OR INDIRECT DAMAGES
  RESULTING FROM ITS PERFORMANCE OR FAILURE TO PERFORM UNDER THIS AGREEMENT;
  WHEATHER BASED UPON CONTRACT, NEGLIGENCE, OR ANY OTHER BASIS WHATSOEVER
  (INCLUDING, WITHOUT LIMITATION, DAMAGES FOR LOSS OF BUSINESS PROFITS. 


	
 

	
 


	
10.

	
Indemnification 


	
 

	
 

	
 


	
 

	
10.1

	
Telematics agrees to protect, defend, indemnify and hold Ituran
  harmless from all sums, costs and expenses which Ituran may incur or be
  obligated to pay as a result of any and all loss, expense, damage, liability,
  claims, demands, either at law or in equity, of every nature whatsoever in
  favor of any person, resulting from any third party claim of infringement of
  intellectual property rights as a result of use, distribution or sale of the
  Products or Services.


	
 

	
 

	
 


	
 

	
10.2

	
Ituran agrees to protect, defend, indemnify and hold Telematics
  harmless from all sums, costs and expenses which Telematics may incur or be
  obligated to pay as a result of any and all loss, expense, damage, liability,
  claims, demands, either at law or in equity, of every nature whatsoever in
  favor of any person, resulting from any third party claim of infringement of
  intellectual property rights as a result of use, distribution or sale of the
  Ituran Technology and Know-how, the Ituran Products or the Ituran Services.


	
 

	
 

	
 


	
11.

	
Term and Termination of the Agreement; Effect of Termination


	
 

	
 

	
 


	
 

	
11.1

	
This
Agreement shall commence on the Effective Date and shall remain in force for
a period of 10 (ten) years or until terminated in accordance with the terms
hereof (the “Term”). Upon expiry of the Term, the Agreement will
automatically renew for additional consecutive 12 month periods, unless
either party notifies the other with 30 business days prior written notice
that the Agreement will not be so renewed.  





***Confidential Treatment Requested










	
 

	
 

	
 

	
 


	
 

	
11.2

	
Neither
  Party shall be entitled to terminate this Agreement unless termination is in
  accordance with Section 11.3 and 11.4 only.


	
 

	
 

	
 


	
 

	
11.3

	
Without
  derogating from any remedy or right available to either Party under any law,
  each Party may immediately terminate this Agreement, by giving termination
  notice to the other Party upon the occurrence of any of the following events:
  


	
 

	
 

	
 


	
 

	
 

	
11.3.1

	
The other
  Party has been declared bankrupt or becomes subject to liquidation
  proceedings that have not been withdrawn, revoked, or rejected within 60
  (sixty) days, or otherwise ceases its business operations for a period of at
  least 60 (sixty) days; 


	
 

	
 

	
 

	
 


	
 

	
 

	
11.3.2

	
Without
  derogating from Section 11.3 above, Ituran shall be entitled to terminate
  this Agreement if Telematics commits a fundamental breach of this Agreement,
  including but without derogating from the generality of the foregoing, a
  material breach of any of its obligations under Sections 1.5, 1.11, 4.1, 6.1, 6.5, 8.2. which has not been cured within 60 days of receipt of
  notification of said breach from Ituran. Telematics shall be entitled to termination
  this Agreement in the event that Ituran does not comply with its payment
  obligations in accordance with this Agreement.


	
 

	
 

	
 

	
 


	
 

	
 

	
11.3.3

	
Without
  derogating from any remedy or right available to Telematics under any law,
  except for termination of this Agreement, if Ituran commits a fundamental
  breach of this Agreement, including a material breach of any of its
  obligations under Sections 3.2, 3.3, 3.7, 6.3, 7 and 8 which has not been
  cured within 60 days of receipt of notification of said breach from Telematics,
  Telematics shall be entitled to terminate all its obligations for the payment
  of consideration as defined in Annex B, paragraph 2.


	
 

	
 

	
 

	
 


	
 

	
11.4

	
Upon
  termination or expiry of this Agreement in accordance with sections 11.3.1 or
  11.3.2 or 11.3.3 above, the following shall occur: 


	
 

	
 

	
 


	
 

	
 

	
11.4.1

	
each party
  shall supply all the open and outstanding purchase orders, including Purchase
  Orders, issued in accordance with this Agreement; 


	
 

	
 

	
 

	
 


	
 

	
 

	
11.4.2

	
for 1 (one)
  year following the expiry or termination of this Agreement, each party shall
  be entitled to continue to deliver purchase orders, including Purchase
  Orders, to the other party and during such 1 (one) year period, the other
  party will supply the other party with products and services ordered in accordance
  with this Agreement during such one year period. 





***Confidential Treatment Requested










	
 

	
 

	
 

	
 


	
 

	
 

	
11.4.3

	
other than
  where the agreement has been terminated in accordance with Sections 11.3.1.
  or 11.3.2, all licenses granted under this Agreement shall survive the
  Agreement’s termination or expiration and shall continue to exist.


	
 

	
 

	
 

	
 


	
 

	
11.5

	
Survival. In
  addition to sections that are defined in this Agreement as surviving
  Termination thereof, Section 4 (Warranty), 10 (indemnification), 9
  (Limitation of Liability) and Annex D (Confidentiality), 8 (licenses to
  Ituran and Telematics) shall survive termination or expiration of this
  Agreement and shall remain in full force thereafter.


	
 

	
 

	
 

	
 


	
12

	
Miscellaneous


	
 

	
 

	
 

	
 


	
 

	
12.1

	
This
  Agreement shall be governed by and construed in accordance with the laws of
  the State of Israel, without regard to its conflict of laws provisions and
  principles. The parties hereto irrevocably agree that, subject to section
  3.5, the competent courts of Tel Aviv-Jaffa shall have exclusive jurisdiction
  to settle all the disputes which may arise out of, under, or in connection
  with this Agreement or the legal relationship established thereby, and that
  no other courts shall have any jurisdiction whatsoever in respect of such
  disputes, and for such purposes irrevocably submit all such disputes to the
  exclusive jurisdiction of such courts.


	
 

	
 

	
 

	
 


	
 

	
12.2

	
This
  Agreement, inclusive of all Annexes attached hereto and made an integral part
  hereof, constitutes the entire understanding and agreement between the
  Parties with respect to the subject matter hereof, and supersedes all prior
  understandings, communications, negotiations, discussions and agreements
  whether written or oral. Terms and conditions of this Agreement take
  precedence over the terms and conditions of any other agreement between
  Ituran and Telematics covering the Products and Services, the Ituran
  Technology and Know-how, the Teletrac
  Systems and Technology, the Ituran Services and the Ituran Products,
  including but not limited to any Purchase Orders or other purchase orders
  issued hereunder. This Agreement shall not be varied or amended except by an
  instrument in writing of subsequent date duly executed by authorized
  representatives of the Parties.





***Confidential Treatment Requested










	
 

	
 

	
 


	
 

	
12.3

	
Should any
  part of this Agreement be declared invalid or unenforceable for any reason,
  such part shall be deemed modified to the extent necessary to make it valid
  and operative and in a manner most closely representing the intention of the
  parties, or if it cannot be so modified, then eliminated, and such
  elimination shall not affect the validity of any remaining portion, which
  shall remain in force and effect as if this Agreement had been executed with
  the invalid portion thereof eliminated.


	
 

	
 

	
 


	
 

	
12.4

	
All notices
  or other communications hereunder shall be in writing and shall be given (i)
  in person, (ii) by registered mail (registered international air mail if
  mailed internationally), (iii) by an overnight courier service which obtains
  a receipt to evidence delivery, (iv) by facsimile transmission (provided that
  written confirmation of transmission is provided by way of the sender’s fax
  machine), or (v) if an email address is provided, by email (provided that
  evidence of delivery is provided and with a copy by e-mail). In each case,
  the notice will be addressed as set forth below or such other address as any
  party may designate to the other in accordance with the aforesaid procedure.
  All communications delivered in person shall be deemed to have been given
  upon delivery. Those deliveries given by facsimile transmission or email
  shall be deemed given on the business day following transmission, and all
  notices and other communications sent by courier or registered mail (or air
  mail if the posting is international) shall be deemed given ten (10) days
  after posting or sending, as applicable, provided that if the courier service
  actually gives personal delivery, then delivery will be deemed to have been
  given on such personal delivery.


	
 

	
 

	
 


	
 

	
 

	
Notices to
  Ituran shall be delivered to:


	
 

	
 

	
 


	
 

	
 

	
Ituran
  Location and Control LTD


	
 

	
 

	
8 Hashikme
  St. 


	
 

	
 

	
Azur, 58001


	
 

	
 

	
Fax:
  +972-3-5571393


	
 

	
 

	
For the
  attention of Guy Aharonov, General Council


	
 

	
 

	
 


	
 

	
 

	
With copy
  to:


	
 

	
 

	
 


	
 

	
 

	
Ituran
  Location and Control LTD


	
 

	
 

	
8 Hashikme
  St. 


	
 

	
 

	
Azur, 58001


	
 

	
 

	
Fax:
  +972-3-5571393


	
 

	
 

	
For the
  attention of Mr. Eyal Sheratzky, CEO





***Confidential Treatment Requested










	
 

	
 

	
 


	
 

	
 

	
Notices to
  Telematics shall be delivered to:


	
 

	
 

	
 


	
 

	
 

	
26 Hamelacha
  St.


	
 

	
 

	
Holon, 58117


	
 

	
 

	
 


	
 

	
 

	
Fax:
  +972-3-5575703


	
 

	
 

	
For the
  attention of Roman Sternberg, VP


	
 

	
 

	
 


	
 

	
 

	
With copy
  to:


	
 

	
 

	
 


	
 

	
 

	
26 Hamelacha
  St.


	
 

	
 

	
Holon, 58117


	
 

	
 

	
 


	
 

	
 

	
Fax:
  +972-3-5575703


	
 

	
 

	
 


	
 

	
 

	
For the
  attention of Eddy Kafry, CEO


	
 

	
 

	
 


	
 

	
12.5

	
Neither Party shall delegate or assign its rights or obligations
  under this Agreement without the other Party’s prior written consent,
  provided that Ituran and its affiliates will be authorized to assign or
  transfer freely all of their rights and obligations hereunder, provided that
  any assignee shall become party to this Agreement. For clarification
  purposes, all affiliated companies of Ituran are entitled to submit Purchase
  Orders to Telematics under the terms and conditions of this Agreement.


	
 

	
 

	
 


	
 

	
 

	
Telematics may, without the consent of Ituran, assign its rights or
  obligations under this Agreement to any of its affiliates. Any attempted
  delegation or assignment by either Party without such consent shall be void.


	
 

	
 

	
 


	
 

	
12.6

	
The waiver of any term or condition of this Agreement must be in
  writing. No such waiver shall be construed as a waiver of any other term or
  condition except as provided in writing, nor as a waiver of any subsequent
  breach of the same term or condition.


	
 

	
 

	
 


	
 

	
12.7

	
Neither Party shall make or authorize any news release,
  advertisement, or other disclosure to any third party which shall deny or
  confirm the existence of this Agreement or reveal the terms of this Agreement
  without prior written consent of the other Party.





***Confidential Treatment Requested










	
 

	
 

	
 


	
 

	
12.8

	
The Parties
  obligations under this Agreement are subject to, and neither Party shall be
  liable for, failure to perform, damages or losses caused or occasioned by
  Events of Force Majeure. For this purpose the term, “Event of Force Majeure”,
  shall mean any event affecting the ability of either Party to fulfill its
  obligations hereunder and where such event arises from or is attributable to
  acts, events, omissions or accidents which are beyond the reasonable control
  of the relevant Party including, without limitation, any abnormally inclement
  weather, flood, lightning, storm, fire, explosion, earthquake, subsidence,
  structural damage, disease, epidemic or other natural physical disaster,
  failure or shortage of power supplies, war, military operations, riot, crowd
  disorder, strike, lock-outs or other industrial action, terrorist action,
  civil commotion and any legislation, regulation, ruling or omissions
  (including failure to grant any necessary permissions) of any relevant
  government, court or any competent national authority.


	
 

	
 

	
 


	
 

	
12.9

	
This Agreement shall be automatically and immediately terminated,
  unless 4 months as of date of signing, SPA closing takes place.





IN WITNESS
WHEREOF, the Parties, intending to be legally bound, have executed this Frame
Product and Service Purchase Agreement by their respective authorized representatives
as of the Effective Date.


	
 

	
 

	
 


	
APPROVED AND AGREED

	
 

	
APPROVED AND AGREED


	
 

	
 

	
 


	


	
 

	



	
TELEMATICS WIRELESS LTD.

	
 

	
ITURAN LOCATION AND CONTROL LTD.


	
 

	
 

	
 


	


	
 

	



	
(Signature)

	
 

	
(Signature)


	
 

	
 

	
 


	


	
 

	



	
(Typed Name)

	
 

	
(Typed Name)


	
 

	
 

	
 


	


	
 

	



	
(Title)

	
 

	
(Title)





***Confidential Treatment Requested









Annex A


1. Telematics Products and Services


	
 

	
 


	
A. Telematics Products include:


	
 

	
 


	
     ***





To avoid any
doubt Telematics Products as defined above include all the variations of each
product as adapted for different Markets as well as all further generations and
derivatives.


B. Telematics Services include:


	
 

	
 


	
1.

	
Maintenance
  and repair of Telematics Products


	
 

	
 


	
2.

	
Performance
  of Telematics Upgrades as defined in section 3.1.


	
 

	
 


	
3.

	
Support to
  Ituran marketing efforts in Ituran Markets as defined in Section 8.1 of the
  Agreement, as applicable





2. Consideration


Following are
the prices to be paid to Telematics by Ituran (Consideration) for Telematics
Products and Services


A. Telematics
Products


     ***


B. Telematics
Services


     1.
Maintenance and Repair of Telematics Products 


     1.1 ***


     1.2 ***


     2.
Telematics Upgrades: *** 


C. Support to
Ituran Marketing Efforts 


***


D. Production
Files - set of documents that are identical to the set of documents provided by
Telematics to its manufacturers.


E. Tariff


***


***Confidential Treatment Requested









Annex B


1. Ituran Technology, Products, Know-How and
Services


	
 

	
 


	
1.

	
“Ituran
  Technology” is *** 


	 
	
2.

	
Ituran
  Products ***


	 
	
3.

	
Ituran
  know-how ***


	 
	
4.

	
Ituran
  Services include following services associated with
  the design, deployment, maintenance and operation of Teletrac System:


	 
	
 

	
***


	
 

	
 


	
 

	
It is hereby
  clarified that Telematics shall be entitled to purchase the Ituran Products
  from an alternative manufacturer, provided that in this case Ituran shall not
  give any warranty and/or undertaking and/or representation in respect of the
  Ituran Product purchased from such alternative manufacturer and shall have no
  obligations in respect thereof.





2. Consideration


Following are
the prices to be paid to Ituran by Telematics (Consideration) for Ituran
Products and Services


	
 

	
 


	
1.

	
Ituran
  Products: ***


	 
	
2.

	
Ituran
  services: 


	 
	
 

	
***


	 
	
 

	
In addition,
  Telematics shall pay the following fees: 


	
 

	
In China and
  Korea:


	 
	
 

	
***


	 
	
 

	
     3.
  Tariff


	 
	
 

	
     ***





***Confidential Treatment Requested









Annex C


Teletrac Systems and Technology


***


***Confidential Treatment Requested









Annex D


CONFIDENTIALITY AGREEMENT


This Confidentiality Agreement (this “Agreement”)
is entered into as of the ____ day of __________ 2007 (the “Effective Date”), by and
between Ituran Location and Control Ltd., a company incorporated under the laws
of the State of Israel having its principal place of business at 26 Hamelacha
St., Industrial Zone, Holon, Israel (“Ituran”), and Telematics Wireless Ltd., a
company incorporated under the laws of the State of Israel having its principal
place of business at 26, Hamelacha Street, Holon Industrial Area, Holon, Israel
(“Telematics”) (each referred to
as a “Party” and collectively the “Parties”). 


All undefined
capitalized terms used in this Confidentiality Agreement, except where stated
otherwise, will have the same meanings as contained in the Frame Product and Service Purchase Agreement
dated ________ between Ituran and Telematics.


	
 

	
 


	
1.

	
In order to
  evaluate, establish or continue a business relationship between both parties
  hereto, each undersigned party (a “Recipient”)
  acknowledges that the other party (a “Discloser”)
  has or may disclose to it Confidential Information, as defined below. 


	
 

	
 


	
2.

	
The term “Confidential Information” shall include
  any information or material which is proprietary to the Discloser or
  designated as “Confidential Information” by Discloser, including but not
  limited to corporate information, business development plans and strategies,
  designs, drawings, photographs, specifications, techniques, models, data,
  algorithms, specifications, source code, object code, documentation,
  diagrams, flow charts, research, development, process, procedures,
  “know-how”, inventions, discoveries, new product or new technology
  information, product prototypes, product copies, marketing techniques and
  materials, marketing timetables, including trade names, trademarks, customer
  names and other information related to customers and sales, pricing policies,
  and other technical, business and financial information. 


	
 

	
 


	
3.

	
The term
  Confidential Information does not include information which is or becomes
  publicly available through no fault or action of the Recipient or agents,
  representatives or employees of the Recipient, or becomes available to the
  Recipient on a non-confidential basis from another source which is not
  prohibited to the best knowledge of the Recipient from disclosing such
  information to the Recipient by a contractual, legal or fiduciary obligation.


	
 

	
 


	
4.

	
The
  Confidential Information furnished pursuant to this Confidentiality Agreement
  is done so solely for the purpose of furthering the business relationship for
  which it was disclosed to the Recipient (the “Purpose Of Disclosure”). 





***Confidential Treatment Requested










	
 

	
 


	
5.

	
The
  Recipient hereby undertakes not to use the Confidential Information for any
  purpose, commercial or otherwise, except for the Purpose Of Disclosure. Upon
  the request of the Discloser, the Recipient will either destroy all copies of
  the Confidential Information or return all copies of the Confidential
  Information to the Discloser within seven days.


	
 

	
 


	
6.

	
The
  Recipient hereby agrees to keep confidential the Confidential Information and
  will not (except as required by applicable law, regulation or process, and
  then only after giving reasonable prior written notice to the Discloser)
  without the prior written consent of the Discloser, disclose any Confidential
  Information to any person; provided, however, that the
  Recipient may reveal the Confidential Information to its employees only to
  the extent absolutely necessary on an “absolute need to know” basis solely
  for the Purpose Of Disclosure and the Recipient shall ensure that each such
  employee shall hold such Confidential Information in confidence and trust and
  subject to the restrictions imposed by this letter agreement.


	
 

	
 


	
7.

	
The
  Recipient undertakes to take all actions and appropriate precautions which
  may be necessary to ensure that any of its employees who has received
  Confidential Information directly or indirectly from or on behalf of the
  Recipient, shall not divulge or disclose any aspect of the same to any person
  in any manner, directly or indirectly, or use the same for any purpose except
  in connection with the Purpose Of Disclosure.


	
 

	
 


	
8.

	
The
  Recipient acknowledges that all Confidential Information shall remain the
  Discloser’s sole and exclusive property, and no license or other rights in
  the Confidential Information are granted hereby, except the limited right to
  use the Confidential Information for the Purpose Of Disclosure. All
  information provided by the Discloser is provided “AS IS” and without
  warranty, express, implied, or otherwise, regarding its accuracy or
  performance.


	
 

	
 


	
9.

	
If the
  Recipient commits a breach of, or threatens to commit a breach of, any of the
  terms or conditions of this letter agreement, the Discloser shall have the
  right to seek and obtain all judicial relief (including but not limited to
  specific monetary damages, interest and attorney’s fees and expenses) as may
  be ordered or awarded by a court of competent jurisdiction. The Recipient
  hereby acknowledges that, in the event of a breach of this letter by the
  Recipient, legal remedies would be inadequate compensation. The Recipient
  therefore agrees that prior to and in addition to any legal remedies obtained
  for a breach of this letter agreement by the Recipient, the Discloser shall
  be entitled to seek and, if awarded, enjoy immediate equitable relief against
  the Recipient.





***Confidential Treatment Requested










	
 

	
 


	
10.

	
This letter
  agreement shall be governed by and construed in accordance with the laws of
  the State of Israel and each party hereby submits to the exclusive
  jurisdiction of the competent court in the district of Tel Aviv – Jaffa and
  no other court shall have jurisdiction over any matter connected with this
  letter agreement.


	
 

	
 


	
11.

	
The parties
  do not intend that any agency or partnership relationship be created between
  them by this letter agreement.


	
 

	
 


	
12.

	
All additions
  or modifications to this letter agreement must be made in writing and must be
  signed by both parties.


	
 

	
 


	
13.

	
This letter
  agreement may not be assigned, in whole or in part, by either party without
  the prior written consent of the other party.


	
 

	
 


	
14.

	
Neither
  party will use the name or trademarks of the other party in any news release,
  publicity, advertising, endorsement, or commercial communication without the
  prior written approval of the other party.


	
 

	
 





This letter
agreement constitutes the entire and exclusive agreement between the parties
with respect to the subject matter hereof. 


IN WITNESS
WHEREOF, the Parties, intending to be legally bound, have executed this
Confidentiality Agreement by their respective authorized representatives as of
the Effective Date.


	
 

	
 

	
 


	
APPROVED AND AGREED

	
 

	
APPROVED AND AGREED


	
 

	
 

	
 


	


	
 

	



	
TELEMATICS WIRELESS LTD.

	
 

	
ITURAN LOCATION AND CONTROL LTD.


	
 

	
 

	
 


	


	
 

	



	
(Signature)

	
 

	
(Signature)


	
 

	
 

	
 


	


	
 

	



	
(Typed Name)

	
 

	
(Typed Name)


	
 

	
 

	
 


	


	
 

	



	
(Title)

	
 

	
(Title)





***Confidential Treatment Requested