Document:

Amended and Restated Warrant to Purchase Shares of Common Stock

  
 EXHIBIT 4.12

  
 THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY NOT BE SOLD, OFFERED FOR SALE, ASSIGNED, TRANSFERRED OR OTHERWISE DISPOSED OF, UNLESS REGISTERED PURSUANT TO THE PROVISIONS OF THAT ACT AND ANY SUCH APPLICABLE LAWS OR AN OPINION OF COUNSEL
REASONABLY ACCEPTABLE TO THE COMPANY IS OBTAINED STATING THAT SUCH DISPOSITION IS IN COMPLIANCE WITH AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION. 
  
 ATX TECHNOLOGIES, INC. 
  
 (Void after 5:00 p.m., San Antonio, Texas time, on March 18, 2008) 
  
 Amended and Restated Warrant to Purchase Shares of Common Stock 
  
 July 13, 2001 
  
 AMENDED AND RESTATED WARRANT TO PURCHASE SHARES OF COMMON STOCK (this “Warrant”), dated as of July 13,
2001, between ATX TECHNOLOGIES, INC., a Texas corporation (the “Company”), and James R. Leininger, M.D., an individual residing in San Antonio, Texas, or his assigns (the “Holder”). 
  
 WHEREAS, the Company, Holder and Vodafone TeleCommerce GmbH, a German limited
liability company (“VTC”), have entered into a Series C and D Convertible Preferred Stock Share Subscription Agreement, dated as of July 6, 2001 (the “Subscription Agreement”), pursuant to which Holder will purchase
and the Company will sell, subject to the terms and conditions thereof, shares of the Company’s Series C Convertible Preferred Stock, par value $.0l per share (the “Series C Preferred Stock”), and VTC will purchase and the
Company will sell, subject to the terms and conditions thereof, shares of the Company’s Series D Convertible Preferred Stock, par value $.0l per share (the “Series D Preferred Stock”); and 
  
 WHEREAS, the Company and Holder desire to amend certain terms of and restate
in its entirety the Warrant to Purchase Shares of Common Stock, dated March 18, 1998 (the “Original Issue Date”), by and between the Company and Holder, to amend certain rights and obligations of the Company and Holder in light of
the terms of the Subscription Agreement; and 
  
 WHEREAS, the
execution by the Company of this Warrant, as amended and restated, is a condition to VTC’s purchase of Series D Preferred Stock under the Subscription Agreement. 
  
 NOW, THEREFORE, FOR VALUE RECEIVED, the Company hereby certifies that Holder is entitled, subject to the provisions of this
Warrant, to purchase from the Company, at any time, or from time to time during the period commencing on the Original Issue Date and expiring at 5:00 p.m. San Antonio, Texas local time on the tenth anniversary of the Original Issue Date (the
“Exercise Period”), up to 428,572 fully paid and nonassessable shares of 

  

 
Common Stock of the Company at a price of $1.75 per share (such exercise price per share, as it may be adjusted as set out herein, being hereinafter referred
to as the “Exercise Price”). 
  
 The term
“Common Stock” means the common stock, par value $0.01 per share, of the Company. The number of shares of Common Stock set forth above that may be purchased upon the exercise of the Warrant may be adjusted from time to time as
hereinafter set forth. The shares of Common Stock purchasable upon such exercise, as adjusted from time to time, are hereinafter sometimes referred to as the “Warrant Stock.” This Warrant was purchased by the Holder on March 18,
1998 in connection with the Holder’s purchase of shares of Common Stock from the Company. The Company and the Holder agree that this Warrant was acquired for value equal to its fair market value. 
  
 Upon receipt by the Company of evidence reasonably satisfactory to it of the
loss, theft, destruction or mutilation of the Warrant, and (in the case of loss, theft or destruction) of reasonably satisfactory indemnification, and upon surrender and cancellation of the Warrant, if mutilated, the Company shall execute and
deliver a new Warrant of like tenor and date. Any such new Warrant executed and delivered shall constitute an additional contractual obligation on the part of the Company, whether or not the Warrant so lost, stolen, destroyed or mutilated shall be
at any time enforceable by anyone. 
  
 The Holder agrees with the
Company that the Warrant is issued, and all the rights hereunder shall be held, subject to all of the conditions, limitations and provisions set forth herein. 
  

1. Exercise of Warrant. The Warrant may be exercised in whole or in part at any time, or from time to time, during the Exercise Period, or, if
the last day of such period is a day on which banking institutions in the City of San Antonio, Texas are authorized by law to close, then on the next succeeding day that shall not be such a day, by presentation and surrender hereof to the Company at
its principal office, or at the office of its stock transfer agent, if any, with the Warrant Exercise Form attached hereto duly executed and accompanied by payment (either in cash or by certified or official bank check, payable to the order of the
Company, or by cancellation of indebtedness of the Company to the Holder hereof, if any, at the time of exercise) of the Exercise Price for the number of shares specified in such Form and instruments of transfer, if appropriate, duly executed by the
Holder or his or her duly authorized attorney. If the Warrant should be exercised in part only, the Company shall, upon surrender of the Warrant for cancellation, execute and deliver a new Warrant evidencing the rights of the Holder thereof to
purchase the balance of the Warrant Stock. Upon receipt by the Company of the Warrant, together with the Exercise Price, at its office, or by the stock transfer agent of the Company, if any, at its office, in proper form for exercise, the Holder
shall be deemed to be the holder of record of the shares of Common Stock issuable upon such exercise, notwithstanding that the stock transfer books of the Company shall then be closed or that certificates representing such shares of Common Stock
shall not then be actually delivered to the Holder. 
  
 2.
Reservation of Shares. The Company will at all times reserve for issuance and delivery upon exercise of the Warrant all shares of Common Stock or other shares of capital stock of the Company (and other securities) from time to time receivable
upon exercise of the Warrant. All such shares (and other securities) shall be duly authorized and, when issued upon 

  

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such exercise, shall be validly issued, duly paid and nonassessable and free of all preemptive rights. 
  
 3. Absence of Registration under Securities Act of 1933; Restrictions on
Transferability. The shares of Common Stock issuable upon exercise of the Warrant are not presently, and upon their issuance will not be, registered under the Securities Act of 1933, as amended (the “Act”) or any state
securities laws. The Holder acknowledges that the Warrant was issued in a transaction that is intended to be exempt from the registration requirements of the Act and applicable state securities laws and must be held by the Holder and may not be
resold unless subsequently registered under the Act and any applicable state securities laws or an exemption from any registration is available. The Holder, by its acceptance hereof, agrees to indemnify and hold the Company harmless against loss or
liability arising from the transfer of the Warrant Stock or the Warrant or any interest therein in violation of any Act or any applicable state securities laws. The certificates representing the Warrant Stock will bear the restrictive legend set
forth in Section 11 hereof, and will be subject to the restrictions referred to therein. 
  
 4. Fractional Shares. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of the Warrant, but the
Company shall issue one additional share of its Common Stock in lieu of each fraction of a share otherwise called for upon any exercise of the Warrant. 
  
 5. Exchange, Transfers, Assignment of Warrant. The Warrant cannot be sold, exchanged, transferred, pledged or assigned, except in accordance with
the provision of Section 3 hereof. Upon such event and upon surrender of the Warrant to the Company or at the office of its stock transfer agent, if any, with the Assignment Form annexed hereto duly executed and funds sufficient to pay any
transfer tax, the Company shall, without charge, execute and deliver a new Warrant in the name of the assignee named in such instrument of assignment and the Warrant shall promptly be canceled. 
  
 6. [Intentionally Omitted] 
  
 7. Rights of the Holder. The Holder shall not, by virtue hereof, be
entitled to any rights as a stockholder of the Company, either at law or in equity, and the rights of the Holder are limited to those set forth in the Warrant. 
  

8. Reports. For so long as the Holder is the registered owner of the Warrant, the Company shall furnish to the Holder one copy of (i) such
financial statements and other periodic reports as it may from time to time distribute generally to the holders of any class of its capital stock; and (ii) each report it is required to file with the Securities and Exchange Commission. 

 
 9.1 Exercise Price Adjustment. The Exercise Price shall be subject
to adjustment from time to time as follows; provided, however, that no adjustment of the Exercise Price shall have the effect of increasing such Exercise Price above the Exercise Price in effect immediately prior to such adjustment except as
provided pursuant to Section 9.l(d): 
  
 (a) (i) Upon each issuance (or deemed issuance pursuant to the provisions hereof) by the Company of any Additional Stock (as defined below) after the Original Issue Date, without consideration or for an Effective Price (as defined below)
per share less than the 

  

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Exercise Price in effect immediately prior to the issuance (or deemed issuance) of such Additional Stock, then the Exercise Price in effect immediately prior
to each issuance (or deemed issuance) shall be adjusted to a price determined by multiplying such Exercise Price by a fraction, (1) the numerator of which shall be the number of Common Stock Equivalents Outstanding immediately prior to such issuance
plus the number of shares of Common Stock which the aggregate consideration received (or deemed received) by the Company for such issuance would purchase at such Exercise Price; and (2) the denominator of which shall be the number of Common Stock
Equivalents Outstanding immediately after such issuance. 
  
 (ii) No adjustment of the Exercise Price shall be made in an amount less than $0.01 per share, provided that any adjustments which are not required to be made by reason of this sentence shall be carried forward and
shall be taken into account in any subsequent adjustment to the Exercise Price. 
  
 (iii) In the case of the issuance of securities of the Company for cash, the amount of consideration received by the Company for such
securities shall be deemed to be the amount of cash paid therefor before deducting any discounts, commissions or other expenses allowed, paid or incurred by the Company for any underwriting or otherwise in connection with the issuance and sale
thereof. 
  
 (iv) In the case of the issuance of
securities of the Company for a consideration in whole or in part other than cash, the consideration other than cash shall be deemed to have a dollar value equal to the fair market value of such non-cash consideration as determined by the Board of
Directors, irrespective of any accounting treatment thereof. 
  
 (v) In the case of the issuance on or after the Original Issue Date of Options (as defined below) or Convertible Securities (as defined below), the following provisions shall apply for all purposes of Sections
9.1(a) and (b). 
  
 (A) With respect
to Options to purchase Common Stock, the aggregate maximum number of shares of Common Stock deliverable upon exercise of such Option shall be deemed to have been issued at the time such Options were issued and for a consideration equal to the
consideration (determined in the manner provided in Section 9.1(a)(iii) and (iv), if any, received by the Company for such Options plus the minimum exercise price provided in such Options for the Common Stock covered thereby. 
  
 (B) With respect to Convertible Securities and Options to
purchase Convertible Securities, the aggregate maximum number of shares of Common Stock deliverable upon the conversion or exchange of any such Convertible Securities and the aggregate maximum number of shares of Common Stock issuable upon the
exercise of such Option to purchase Convertible Securities and the subsequent conversion or exchange of such Convertible Securities shall be deemed to have been issued at the time such Convertible Securities or such Options were issued and for a
consideration equal to the consideration, if any, received by the Company for any such Convertible Securities and Options, plus the minimum additional consideration, if any, to be received by the Company upon the conversion or exchange of such
Convertible Securities or the exercise of such Options and the conversion or exchange of the Convertible Securities or the exercise of such Options and the conversion or exchange of the 

  

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Convertible Securities issuable upon exercise of such Options (the consideration in each case to be determined in the manner provided in Section
9.1(a)(iii) and (iv). 
  
 (C) In the
event of any change in the number of shares of Common Stock deliverable, or in the consideration payable to the Company, upon exercise of such Options or upon conversion or exchange of such Convertible Securities, including, but not limited to, a
change resulting from the antidilution provisions thereof, other than the Excluded Securities (defined below), the Exercise Price, to the extent in any way affected by or computed using such Options or Convertible Securities, shall be recomputed to
reflect such change, but no further adjustment shall be made for the actual issuance of Common Stock or any payment of such consideration upon the exercise of any such Options or the conversion or exchange of such Convertible Securities.
“Excluded Securities” means the Company’s Series A Convertible Preferred Stock, the Company’s Series B Convertible Preferred Stock and the Secured Convertible Note dated August 25, 1999, payable to Protection One Alarm
Monitoring, Inc. 
  
 (D) Upon the expiration or
termination of any such Options or any such rights to convert or exchange Convertible Securities, the Exercise Price, to the extent in any way affected by or computed using such Options or Convertible Securities, shall be recomputed to reflect the
issuance of only the number of shares of Common Stock (and Options and Convertible Securities which remain in effect) that were actually issued upon the exercise of such Options or upon the conversion or exchange of such Convertible Securities.

  
 (E) The number of shares of Common Stock
deemed issued and the consideration deemed paid therefor pursuant to Section 9.1(a)(v)(A) and (B) shall be appropriately adjusted to reflect any change, termination or expiration of the type described in either Section
9.1(a)(v)(C) or (D). 
  
 (b)
“Additional Stock” shall mean any shares of Common Stock issued (or deemed to have been issued pursuant to Section 9.1(a)(v) by the Company after the Original Issue Date other than: 
  
 (i) Common Stock issued pursuant to a transaction described
in Section 9.l(c); 
  
 (ii) Shares of
Common Stock issuable or issued to employees, officers, directors of, or consultants to, executive recruiters for, or lessors of personal property to the Corporation, directly or pursuant to a stock option plan or stock purchase plan or any stock
option grant, stock purchase agreement or other written agreement, in each case approved by the Board of Directors of the Company; 
  
 (iii) Any Common Stock issued or issuable upon exercise of any Options, or upon conversion of any Convertible Securities outstanding on or
before the Original Issue Date; 
  
 (iv) Any
Common Stock issued or issuable upon the issuance or conversion of the shares of Series C Preferred Stock issued pursuant to the Subscription Agreement or the Amended and Restated Convertible Promissory Note, dated July 13, 2001; 
  

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 (v) Any Common Stock issued or issuable upon the issuance or exercise of either of the
“Purchase Options” referred to in Section 4 of the Reimbursement Agreement entered into by the Company and Holder pursuant to the Subscription Agreement; or 
  
 (vi) Any Common Stock issued or issuable upon the exercise of the two Amended and Restated Warrants issued
to James R. Leininger currently with this Amended and Restated Warrant. 
  
 (c) In the event the Company at any time or from time to time after the Original Issue Date fixes a record date for the effectuation of a split or subdivision of the outstanding shares of Common Stock or the
determination of holders of Common Stock entitled to receive a dividend or other distribution payable in additional shares of Common Stock or other securities or rights convertible into, or entitling the holder thereof to receive directly or
indirectly, additional shares of Common Stock (hereinafter referred to as “Common Stock Equivalents”) without payment of any consideration by such holder for the additional shares of Common Stock or the Common Stock Equivalents
(including the additional shares of Common Stock issuable upon conversion or exercise thereof), then, as of such record date (or the date of such dividend, distribution, split or subdivision if no record date is fixed), the Exercise Price shall be
appropriately decreased so that the number of shares of Common Stock issuable on exercise of this Warrant shall be increased in proportion to such increase in the aggregate number of shares issuable with respect to Common Stock Equivalents, with the
number of shares issuable with respect to Common Stock Equivalents determined from time to time in the manner provided for deemed issuances in Section 9.l(a)(v). 
  
 (d) If the number of shares of Common Stock outstanding at any time after the Original Issue Date is
decreased by a combination of the outstanding shares of Common Stock, then, following the record date of such combination, the Exercise Price shall be appropriately increased so that the number of shares of Common Stock issuable on exercise of this
Warrant shall be decreased in proportion to such decrease in the outstanding shares of Common Stock. 
  
 9.2 Recapitalization. If at any time after the Original Issue Date or from time to time there shall be a recapitalization of the Common Stock,
provision shall be made so that the holder of this Warrant shall thereafter be entitled to receive, upon exercise of this Warrant, the number of shares of stock or other securities or property of the Company or otherwise, receivable upon such
recapitalization by a holder of the number of shares of Common Stock into which this Warrant could have been converted immediately prior to such recapitalization. In any such case, appropriate adjustment shall be made in the application of the
provisions this Section 9 with respect to the rights of the holder of this Warrant after the recapitalization to the end that the provisions of this Section 9 (including adjustments of the Exercise Price then in effect and the number
of shares purchasable upon exercise of this Warrant) shall be applicable after that event as nearly equivalent as may be practicable. 
  
 9.3 No Impairment. The Company will not, by amendment of its Articles of Incorporation or through any reorganization, recapitalization or any other
voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the 

  

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provisions of this Section 9 and in the taking of all such actions as may be necessary or appropriate in order to protect the rights of the holder of
this Warrant against impairment. 
  
 9.4 Certificate as to
Adjustments. Upon the occurrence of each adjustment or readjustment of the Exercise Price pursuant to this Section 9, the Company, at its expense, shall promptly compute such adjustment or readjustment in accordance with the terms hereof
and prepare and furnish to the holder of this Warrant a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Company shall, upon the written request at any
time of the holder of this Warrant, furnish or cause to be furnished to such holder a like certificate setting forth (i) such adjustment and readjustment, (ii) the Exercise Price at the time in effect, and (iii) the number of shares of Common Stock
and the amount, if any, of other property which at the time would be received upon the exercise of this Warrant. 
  
 9.5 Notices of Record Date. In the event of any taking by the Company of a record of the holders of any class of securities for the purpose of
determining the holders thereof who are entitled to receive any dividend other than a cash dividend) or other distribution, any right to subscribe for, purchase or otherwise acquire any shares of stock of any class or any other securities or
property, or to receive any other right, the Company shall mail to the holder of this Warrant, at least 20 days prior to the date specified therein, a notice specifying the date on which any such record is to be taken for the purpose of such
dividend, distribution or right, and the amount and character of such dividend, distribution or right. 
  
 9.6 Notices. Any notice required by the provisions of this Section 9 to be given to the holder of this Warrant shall be deemed given if sent
by facsimile transmission, by telex, or if deposited in the United States mail, postage prepaid, and addressed to each holder of record at his, her or its address appearing on the books of the Company. 
  
 9.7 Definitions. For purposes of this Section 9 in addition to
the definitions set forth above, the following terms shall have the indicated meaning: 
  
 (a) “Common Stock Equivalents Outstanding” means the number of shares of Common Stock that is the sum of: (i) all shares
of Common Stock that, at the time in question, are then outstanding plus (ii) all shares of Common Stock issuable upon the conversion in full of all Convertible Securities that are then outstanding plus (iii) all shares of Common Stock that are
issuable upon the exercise in full of all Options that are then outstanding (assuming the full conversion of any Convertible Securities issuable upon exercise of any such Options that are Options to purchase Convertible Securities). 
  
 (e) “Convertible Securities” means any
indebtedness or shares of stock convertible into or exchangeable for Common Stock. 
  
 (f) The “Effective Price” of shares of Additional Stock means the quotient determined by dividing (i) the total number of
such shares of Additional Stock issued or sold, or deemed to have been issued or sold, by the Company under Section 9 into (ii) the consideration received by the Corporation under Section 9 for the issuance of such shares. 

 

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 (g) “Options” means rights, options or warrants to subscribe for,
purchase or otherwise acquire Common Stock or Convertible Securities. 
  
 10. Right to Convert Warrant. The Holder shall have the right to convert this Warrant (the “Conversion Right”) at any time prior to the expiration of the Exercise Period, into shares of Common Stock in accordance
with this Section 10; provided, however, that no such right shall exist if there is no reported bid and ask price for the Common Stock to enable the determination of the Closing Price (as defined below). 
  
 Upon exercise of the Conversion Right, the Company will deliver to the Holder
(without payment by the Holder of the Exercise Price) the number of shares of Common Stock equal to the quotient obtained by dividing (x) the value of the portion of this Warrant being converted at the time the Conversion Right is exercised
(determined by subtracting the aggregate Exercise Price for the portion of the Warrant being converted (in effect immediately prior to the exercise of the Conversion Right) from the amount obtained by multiplying the number of shares of Common Stock
issuable upon the exercise of the portion of this Warrant being converted by the Closing Price (as defined below) immediately prior to the exercise of the Conversion Right by (y) the Closing Price of one share of Common Stock immediately prior to
the exercise of the Conversion Right. 
  
 For purposes hereof, the
“Closing Price” shall mean the average of the closing bid and ask prices on the principal national securities exchange on which the Common Stock is listed or admitted to trading, or, if the Common Stock is not listed or admitted to
trading on any national securities exchange, the average of the highest reported bid and lowest reported ask prices as furnished by the National Association of Securities Dealers, Inc. through the Nasdaq or a similar organization if Nasdaq is no
longer reporting such information. 
  
 The Conversion Right may be
exercised by the Holder, at any time or from time to time, prior to its expiration and subject to the first sentence of this Section 10, on any business day by delivering a written notice (the “Conversion Notice”) to the
Company at the offices of the Company, exercising the Conversion Right and specifying (i) the total number of shares of Common Stock the Holder will purchase pursuant to the conversion and (ii) a place and date not less than two nor more than 20
business days from the date of the Conversion Notice for the closing of such purchase. 
  
 At any closing under this Section 10, (i) the Holder will surrender this Warrant and (ii) the Company will deliver to the Holder a certificate or certificates of the number of shares of Common Stock issuable
upon such conversion. 
  
 11. Legend. Upon exercise of the
Warrant and the issuance of shares of Common Stock thereunder, all certificates representing such shares shall bear substantially the following legend, as well as any other legend(s) required by applicable law: 
  
 “The shares of Common Stock represented by this certificate have not
been registered under the Securities Act of 1933, as amended, and may not be offered for sale, sold, pledged, assigned, transferred or otherwise disposed of, unless registered pursuant to 

  

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the provisions of that Act or an opinion of counsel reasonably acceptable to the Corporation is obtained stating that such disposition is in compliance with
an available exemption from such registration.” 
  
 12.
Applicable Law. This Warrant is being executed and delivered, and is intended to be performed in the State of Texas. Except to the extent that the laws of the United States may apply to the terms hereof, the substantive laws of the State of
Texas shall govern the validity, construction, enforcement and interpretation of this Warrant, 
  
 13. Notice. Any notice provided for by this Warrant and any other notice, demand or communication which any party may wish to send to the other shall be in writing and shall be delivered by facsimile, reliable
courier, or first-class registered or certified United States mail, postage prepaid, return receipt requested in a properly sealed envelope, and addressed to the party for which such notice, demand or communication is intended at such party’s
address as set forth below: 
  
 If to the Holder:

  
 James R. Leininger, M.D. 
 8122 Datapoint Drive, Suite 900 
 San
Antonio, Texas 78229 
 Attention: Thomas W. Lyles, Jr. 
  
 If to the Company: 
  
 ATX Technologies, Inc. 
 8550 Freeport
Parkway 
 Irving, Texas 75063 
 Attention: President 
  
 Any address or name specified
above may be changed by a notice given by the addressee to the other parties in accordance with this Section 13. 
  
 Any notice, demand or other communication shall be deemed given and effective as of the date of delivery in person or upon receipt as set forth on the
return receipt. The inability to deliver because of changed address of which no notice was given, or the rejection or other refusal to accept any notice, demand or other communication, shall be deemed to be receipt of the notice, demand or other
communication as of the date of such inability to deliver or the rejection or refusal to accept. 
  
 [signature page follows] 
  

 -9- 

 IN WITNESS WHEREOF, the Company has caused this Amended and Restated Warrant to be signed on its behalf,
in its corporate name, by its duly authorized officer, all as of the day and year first above written. 
  

			
	ATX TECHNOLOGIES, INC.
		
	By:	 	 
	 	 	

	 	 	 Steven A. Millstein

	 	 	 President and CEO

  

	
	
	 
	

	 JAMES R. LEININGER, M.D.

  

 -10- 

 IN WITNESS WHEREOF, the Company has caused this Amended and Restated Warrant to be signed on its behalf
in its corporate name, by its duly authorized officer, all as of the day and year first above written. 
  

			
	ATX TECHNOLOGIES, INC.
		
	By:	 	 
	 	 	

	 	 	 Steven A. Millstein

	 	 	 President and CEO

  

	
	
	 
	

	 JAMES R. LEININGER, M.D.

  

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 WARRANT EXERCISE FORM 
  
 The undersigned hereby irrevocably elects to exercise the within Warrant to the extent of purchasing
         shares of Common Stock of ATX Technologies, Inc., a Texas corporation (the “Company”), and hereby makes payment in full therefor of
$                     
  

	
	
	 
	

	 Signature

  

	
	
	 
	

	 Signature, if jointly held

  

	
	
	 
	

	 Date

  
 INSTRUCTIONS
FOR ISSUANCE OF STOCK 
 (if other than to the registered holder of the within Warrant) 
  

			
	Name:	 	 
	 	 	

	 	 	 (Please typewrite or print in block letters)

  

			
	Address:	 	 
	 	 	

	 	 	 
	 	 	

	 	 	 
	 	 	

  

			
	Social Security or Taxpayer
	 Identification Number:
	 	 
	 	 	

  

 WARRANT ASSIGNMENT FORM 
  
 FOR VALUE RECEIVED,
                                        
                                        
             hereby sells, assigns and transfers unto 

	
	  

	Name (Please typewrite or print in block letters)

  
 the right to purchase Common Stock of
ATX Technologies, Inc., a Texas corporation, represented by this Warrant to the extent of shares as to which such right is exercisable and does hereby irrevocably constitute and appoint
                    , Attorney, to transfer the same on the books of the Company with full power of substitution in the premises, 

 
 DATED:
                                        
     
  

	
	
	 
	

	 Signature

  

	
	
	 
	

	 Signature, if jointly heldTelematics Services  Agreement

  
 EXHIBIT 10.1

  
 CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS

 OF THIS DOCUMENT HAVE BEEN REDACTED AND HAVE BEEN 
 SEPARATELY FILED WITH THE COMMISSION.*** 
  

 February 19, 2002 
  

TELEMATICS SERVICES AGREEMENT 
  
 This TELEMATICS SERVICES AGREEMENT (“Agreement”) is made as of January 1, 2002 (the “Effective Date”), by and between BMW of North
America, LLC, a Delaware limited liability company (“BMW”), and ATX Technologies, Inc., a Texas corporation (“ATX”), each of whom may be hereafter referred to individually as a “party” or collectively as the
“parties.” 
  
 RECITALS 
  
 WHEREAS, BMW is in the business of, among other things, importing and
distributing automobiles and light trucks (“Vehicles”); 
  
 WHEREAS, BMW intends to enter into agreements with its consumer customers to monitor signals emitted by telematics devices installed by or on behalf of BMW in customers’ Vehicles (the “Devices”); 
  
 WHEREAS, ATX is in the business of, among other things, providing
location-based emergency, navigation, and information services; location data; and connectivity, infrastructure, and support services for the integration of third parties’ service offerings (collectively, the “Telematics Services”);
and 
  
 WHEREAS, the parties desire to enter an agreement
pursuant to which ATX will become the exclusive provider of Telematics Services for Vehicles under the terms and conditions of this Agreement; 
  
 WHEREAS, BMW shall provide ATX with the opportunity to sell Telematics Services to selected BMW customers. 
  
 NOW, THEREFORE, for and in consideration of the foregoing, the mutual
promises and covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 
  

	1.	THE TELEMATICS SERVICES.  

  
 A. DESCRIPTION. The Telematics Services provided by ATX pursuant to this Agreement shall consist of the services set forth on Exhibit A hereto
(such services hereinafter being referred to as “ATX Services”). ATX will provide the ATX Services to those occupants of Vehicles that are properly equipped with Devices to receive the ATX Services. Fees for ATX Services shall be
calculated, invoiced and paid in accordance with the terms set forth on Exhibit B hereto. 
  

 2 
 CONFIDENTIAL TREATMENT 

 B. EXCLUSIVE NATURE. Commencing January 1, 2002, ATX shall be the exclusive provider of the
Exclusive Services to those owners/lessees of Vehicles, sold or leased after February 1, 2001, whose vehicles are properly equipped with Devices to receive the ATX Services based on the Akira platform or subsequent platform (each such vehicle, an
“Eligible Vehicle”). BMW shall not, directly or indirectly, provide or contract for Exclusive Services to any owner/lessee of a BMW Vehicle who is then receiving Exclusive Services directly or indirectly from ATX. “Exclusive
Services” mean (i) emergency telematics services (i.e., automatic collision notification, emergency assistance, enhanced roadside assistance, stolen vehicle tracking, security system notification, remote door unlock and vehicle locator); (2)
the gathering of location data of BMW Vehicles; and (3) the connectivity, infrastructure and support services for the integration of Telematics Service offerings by BMW for BMW Vehicles. 
  

	2.	ATX DUTIES AND RESPONSIBILITIES. 

  
 A. MONITORING. ATX shall monitor, process and respond to, all data, signals and telephone calls (collectively, “Incidents”) received from
Eligible Vehicles owned or leased by BMW customers who have executed and delivered a Subscription Agreement (as hereinafter defined) on a seven (7)-day-per-week, twenty-four (24) hour-per-day basis at ATX’s response center (the “Response
Center”) in accordance with the “BMW Operating Procedures”, defined in the manner described below, and in accordance with all applicable federal, state, and local laws, regulations, and other legal requirements (collectively,
“Laws”). BMW understands that (i) ATX will not send any personnel in response to any Incident, and (ii) ATX does not represent or promise that anyone telephoned or contacted by or through ATX, including without limitation, emergency
service providers, roadside assistance providers or concierge service providers (each a “Contact Person”) will respond to the call and BMW hereby releases ATX from any responsibility or liability for any losses incurred as a result of such
failure or delay of such Contact Person in responding to ATX’s call to such Contact Person. Based on the detailed service specifications requested by BMW, ATX and BMW shall work diligently and in good faith to develop, on or before November 1,
2001, the material policies and procedures governing the manner in which the ATX Response Center delivers the ATX Services to BMW Vehicles (the “BMW Operating Procedures”) for Akira platform vehicles. ATX shall be obligated to deliver its
initial proposed BMW Operating Procedures for the Akira platform on or before October 1, 2001. Based on the detailed service specifications requested by BMW, ATX and BMW shall work diligently and in good faith to develop, at least 90 days prior to
service launch, the BMW Operating Procedures for Everest platform vehicles in 2002 and subsequent platforms thereafter. ATX shall be obligated to deliver its initial proposed BMW Operating Procedures for the Everest platform and subsequent platforms
at least 120 days prior to service launch. Upon written approval by BMW (which approval will not be unreasonably withheld) of the BMW Operating Procedures, they will be incorporated into this agreement as Exhibit C. ATX may subsequently modify the

  

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BMW Operating Procedures from time to time only upon the prior written approval of BMW (which approval will not be unreasonably withheld). Failure by ATX to
deliver its initial proposed BMW Operating Procedures within the time periods specified shall be deemed a material breach of this Agreement. 
  
 B. RESPONSE CENTER. ATX shall establish, staff, equip, and operate the Response Center so as to properly perform the ATX Services (collectively,
“Response Center Operation”) consistent with the metrics defined in the BMW Operating Procedures, and shall procure, maintain, and provide all manpower, facilities, equipment (including computer hardware and communications hardware),
information technology/data processing assets (including computer software), supplies, training, expertise, and other tangible and intangible assets and resources associated with Response Center Operation. ATX shall procure and maintain all
licenses, permits, and authorizations required by law to perform the ATX Services or required for the Response Center. 
  
 C. TELECOMMUNICATIONS. ATX shall, throughout the term of this Agreement maintain the necessary “800” number lines and other dedicated
communications lines (e.g., T-1 line to BMW’s roadside provider) at its cost to provide the ATX Services hereunder. The BMW-designated “800” numbers and the other dedicated lines shall be dedicated to BMW-related services only. ATX
agrees to assign said “800” numbers and other dedicated lines to BMW upon termination of this Agreement. 
  
 D. SERVICE LEVEL REQUIREMENTS. Upon receiving an Incident and determining the type of assistance needed, ATX will request dispatch of assistance,
if, in ATX’s sole reasonable judgment, dispatch is warranted by such call. Answer speed targets are as follows: 
  

					
	 Priority 1: Airbag and Emergency:
	 	 	 	 
	 On Target:
	 	>= 90% of calls <= ***	 	 
	 Bin 1:
	 	<= 8% of calls > *** and <= ***	 	 
	 Bin 2:
	 	<= 2% of calls > ***	 	 
			
	 Priority 2: All other calls:
	 	 	 	 
	 On Target:
	 	>= 90% of calls <= ***	 	 
	 Bin 1:
	 	<= 8% of calls > *** and <= ***	 	 
	 Bin 2:
	 	<= 2% of calls > ***	 	 

  
 ATX and BMW
understand that calls in Bin 2 should be minimized, however due to sporadic call volume peaks, some calls may fall in this category. The parties agree that the implementation of new technologies in the delivery of the Telematics Services at the
request of BMW may result in necessary changes to the answer speed targets and that each party will negotiate in good faith to revise those targets if technology so demands. The parties agree, however, that ATX’s failure to meet such answer
speed targets, shall not constitute a 
  
  
 ***Confidential material redacted and filed separately with the Commission 
  

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material breach of this Agreement, but rather shall require the parties to review the program, during which review ATX shall define for BMW the source and
scope of any problems associated with failure to meet the answer speed targets and provide BMW with a written plan of action to address such failure and to meet the standards set forth in this Section 2D. Should ATX continue to fail to meet
said answer speed targets and is unable to remedy or cure the problems associated with such failure, two months after the initial notice of the problem or sixty (60) days beyond the development of the written plan of action noted above, which ever
comes first, such failure shall constitute a material breach of this Agreement by ATX or, at BMW’s option, ATX and BMW may choose to develop additional action plans to address the problem. 
  
 E. MEASUREMENT AND REPORTING. ATX will measure its response time to
all calls on the ATX automation system Response Time reports. “Response Time” shall mean the time from data transmission completion until the time when the Incident is acknowledged by the Response Center. “Data transmission
completion” means the point in time in which a signal has been received, processed and made available in the operator’s queue, ready for acknowledgment. ATX shall compile written monthly response time reports and deliver the same to BMW
within ten (10) days of the end of each month during the term of this Agreement. 
  
 F. ABUSE OF SERVICES. ATX reserves the right to withhold the provision of ATX Services to any BMW customers who abuse ATX Services. Abuse of ATX Services shall mean usage, unjustified by any emergency that
materially interferes with the ability of ATX to efficiently provide Telematics Services to other customers. Examples of material interference include usage that jeopardizes ATX’s ability to meet answer speed requirements for its customers,
which materially increases ATX’s cost of providing services, etc. Prior to withholding the provision of ATX Services, ATX shall notify BMW of its intention to withhold service and the reasons therefore. ATX will not withhold service if BMW
reasonably objects to ATX’s withholding service by notifying ATX within 5 business days of receipt of ATX’s original notice, provided, however, that BMW guarantees relief from performance standards during the continuation of such provision
of services. 
  
 G. CUSTOMER ACCOUNTS. The parties hereto
agree that ATX shall be obligated to perform ATX Services for an owner/lessee of an Eligible Vehicle only from and after such owner/lessee’s execution and delivery (in the manner described herein) to ATX of the data contained within a
subscription agreement for same, in a form mutually acceptable to BMW and ATX (each, a “Subscription Agreement”, a copy is attached hereto as Exhibit D) and upon ATX’s receipt of payment for all required fees for such ATX Services, to
be paid within 30 days after receipt of invoice from ATX (see Exhibit B). In the event BMW disputes a charge on an invoice, BMW will notify ATX within 15 days of receipt of the invoice and the payment obligation for the disputed portion will toll
pending 

  

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 CONFIDENTIAL TREATMENT 

 
resolution of the dispute. The Parties agree to work toward a resolution in good faith. ATX reserves the right, upon BMW’s approval, which approval
shall not be unreasonably withheld, to require changes to the Subscription Agreement as may be necessary or appropriate due to changes or developments in Laws or industry standards. Such changes shall not be retroactively effective to BMW customers
unless specifically authorized or required by any Laws. ATX shall have the right to terminate any BMW customer’s account and/or cease to provide Telematics Services to any BMW customer if such customer breaches the Subscription Agreement or if
ATX does not receive full payment for all fees due for services rendered to such customer. Prior to terminating any account or ceasing to provide Telematics Services to any customer, ATX shall give the customer prior written notice as provided in
the Subscription Agreement. Prior to terminating any such account, ATX shall give BMW detailed reports of accounts to be terminated as specified in the BMW Operating Procedures. ATX shall develop and implement a process for active renewal of
Subscription Agreements for then-existing subscribers. BMW shall hold ATX harmless from any errors or omissions in customer account data received from previous BMW telematics service providers and from the lack of executed subscriber agreements from
any such customers. Additionally, ATX shall be entitled to rely upon the delivery of customer data from a BMW dealer with respect to a Vehicle as a deemed certification that the customer described therein is in fact the lawful owner/lessee of such
Vehicle (whether new or pre-owned) and BMW shall indemnify and hold ATX harmless for claims, liabilities, losses and expenses if the customer described therein is not in fact the lawful owner/lessee of the Vehicle. ATX shall also be entitled to rely
upon notification from BMW that a Vehicle has been removed from service (e.g., totaled, foreign shipment, etc.) and BMW shall indemnify and hold ATX harmless from claims, liabilities, losses, and expenses if the Vehicle has not in fact been removed
from service. BMW shall review and approve, which approval shall not be unreasonably withheld, all proposed electronic or physical correspondence with current or prospective BMW subscribers. 
  
 H. TAXES. At its sole cost and expense, ATX will conduct research to
determine the tax consequences of the retail sales of the telematics services contemplated herein whether sold by or consummated by a BMW Center, over the Internet, by ATX, or any other media, excluding any excise taxes that may apply to the
wireless telecommunication aspect of the telematics services. ATX will provide BMW with a jurisdictional matrix showing the tax consequences for each type of service offered along with a copy of the research relied upon in making such determination.
ATX will be responsible for ongoing tax research, compliance and collection (provided that collection obligations by ATX are limited to payments remitted to ATX) and will provide BMW with a report showing gross sales, exempt sales & tax
collected by jurisdiction for BMW remittance. To that end, ATX will use commercially reasonable efforts to ensure that its personnel and/or consultants acting on its behalf are familiar with all State and Federal, laws and regulations impacting the
tax consequences of the telematic 

  

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 CONFIDENTIAL TREATMENT 

 
services. ATX will maintain a system that will update rate changes and will implement procedures to ensure that the proper determination of tax rates are
applied to all telematics transactions. ATX will conduct periodic review of sales and use tax source documentation and will advise, analyze and provide support documentation to BMW of any extraordinary transactions requiring specialized sales tax
treatment 
  
 Based on its research, ATX will calculate, apply
and collect sales, use, and/or any other taxes required by taxing authorities having jurisdiction over the telematic services provided hereunder. ATX will remit to BMW by the fifth (5th) working day of each month, the taxes calculated and collected by ATX for the previous month. Simultaneous therewith, ATX will provide BMW an electronic file
in flat ASCII format listing location code or customer identifier, gross sales and exempt sales , city, county, state and zip code information and must be compatible with BMW’s tax preparation system requirements as specified herein and as
amended by BMW from time to time. BMW will provide ATX with at least 30 days notice prior to a change in file format to allow ATX time to implement the change. ATX designates its controller for questions relating to the research conducted by ATX or
its suppliers, rate changes and other miscellaneous telematics related tax questions. ATX will verify the accuracy of the file prior to transmittal and will use commercially reasonable measures to ensure the security of the data transferred.

  
 BMW will remit the taxes as determined by ATX, to the
appropriate jurisdictions, by incorporating the taxes on its tax return. ATX will notify BMW of the jurisdictions requiring tax returns via the monthly report. . Based on this notification, BMW will determine the tax registration requirement and
apply for the required tax licenses in such jurisdiction, at its sole cost and expense. 
  
 BMW will represent itself and/or ATX in all sales and use tax examination and will defend all audits, should such audits occur. ATX will cooperate with BMW in all such examinations and audits by providing all source
documents, tax formula and/or any other documents or information relied upon and used by ATX in determining the tax liability for the telematic services hereunder. Additionally, in the event a taxing authority overcharges BMW or assesses additional
taxes, interest and/or penalty, BMW will undertake the prosecution of a refund or defense of such claim, if appropriate, and ATX, at its cost, will promptly provide any and all documentation and assistance required for the defense and pleading of
such matters. Notwithstanding the above, ATX may, at its own expense, engage counsel to consult or defend itself on any such matters. 
  
 ATX will indemnify and hold BMW, its subsidiaries, affiliates, director, officers, successors, assigns, heirs, legal representatives, employees and agents
harmless from any and all losses, liabilities, claims, demands, damages, actions, suits, proceedings, assessments, interests, penalties, judgments, reasonable costs and expenses of whatever nature, suffered or incurred by BMW resulting from any

  

 7 
 CONFIDENTIAL TREATMENT 

 
acts, omissions, negligence or willful misconduct of ATX in the performance of all of its duties, responsibilities and undertakings set forth above in this
Section 2H, including, but not limited to, additional taxes, penalties or interests for failure to file returns directly attributable to ATX’s failure to notify BMW of the need to file a return in a particular jurisdiction; untimely filing due
to ATX’s delayed (beyond 10 days) submission of the monthly electronic file, unless such delay is caused by ATX’s inability to accommodate a requested file format change by BMW; ATX’s use of incorrect tax rates, as determined by the
taxing authorities and improper tax computation by ATX. 
  
 I.
VULNERABILITY OF WIRELESS NETWORK. BMW acknowledges that wireless phone transmissions may be impaired or interrupted by atmospheric conditions, power failures, or other causes, conditions or events beyond the control of ATX. BMW also
acknowledges that the transmission and receipt of wireless signals is dependent upon telephone service and that telephone service may be interrupted, circumvented or compromised by conditions or events beyond the control of ATX. BMW further
acknowledges that the receipt of satellite signals and the use of wireless devices are controlled by the federal government of the United States of America (the “U.S. Government”), and changes in Laws may necessitate the modification of
the ATX Services pursuant to an amendment executed by the parties pursuant to the terms of the Agreement. 
  
 J. WARRANTY. ATX represents and warrants to BMW that it shall provide the ATX Services to BMW customers in a diligent and professional manner
conducive to the BMW brand and shall maintain the infrastructure and trained personnel sufficient to fulfill and comply with the terms and provisions outlined in the BMW Operating Procedures. 
  
 K. LIMITATION OF LIABILITY. BMW acknowledges that ATX is not an
insurer and that the amounts payable by BMW and its customers under this Agreement are not sufficient to warrant ATX’s assuming any responsibility or liability in excess of one (1) year’s ATX Services fee for each affected customer account
for any and all loss or injury sustained by BMW or its customer. BMW agrees to include in all customer contracts and other customer notifications, limitation of BMW’s and ATX’s liability as provided herein. 
  
 IN NO EVENT SHALL ATX BE LIABLE TO BMW FOR ANY SPECIAL, INCIDENTAL, INDIRECT
OR CONSEQUENTIAL DAMAGES, HOWEVER CAUSED. THESE LIMITATIONS WILL APPLY FOR ANY CLAIMS, INCLUDING, WITHOUT LIMITATION, CONTRACT, TORT (INCLUDING NEGLIGENCE) AND STRICT LIABILITY, EVEN IF ATX HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

  
 EXCEPT AS SET FORTH IN SECTION 2J HEREOF, ATX DOES NOT
MAKE ANY OTHER WARRANTY, EXPRESS OR IMPLIED, AND IN PARTICULAR DOES NOT MAKE ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. 

  

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 CONFIDENTIAL TREATMENT 

 
FURTHER, ATX DOES NOT WARRANT THAT THE ATX SERVICES OR THE DEVICES WILL PREVENT ANY LOSS OF PROPERTY OR PERSONAL INJURY BY THEFT, BURGLARY, HOLD-UP, FIRE,
MEDICAL PROBLEM OR OTHERWISE. FURTHERMORE, ATX DOES NOT MAKE ANY WARRANTY, EXPRESS OR IMPLIED, WITH REGARD TO THE WIRELESS PHONE EQUIPMENT, THE WIRELESS SERVICE, OR THE TRANSMISSION OF ATX SIGNALS VIA SUCH SERVICE. 
  
 This Section 2K shall survive any termination or expiration of this
Agreement. 
  

	3.	BMW RESPONSIBILITIES. 

  
 A. INSTALLATION. During the term of this Agreement, BMW shall use reasonable efforts to include Devices in all Vehicles sold or leased by or on
behalf of BMW in the United States. 
  
 B. ACTIVATION. BMW
agrees to include on each Device a notice clearly visible to the Eligible Vehicle owner/lessee that no ATX Services will be provided unless and until a completed and fully executed Subscription Agreement is received by ATX. Such notice shall be in
place at the time each Eligible Vehicle is delivered to its owner/lessee. BMW shall also provide a permanent, conspicuous notice in each Eligible Vehicle (e.g., in the owner’s manual) to inform the owner/lessee of a 1-800 number to call with
questions about the ATX Services and advise each owner/lessee to conduct an acquaintance call with ATX after activation of the ATX Services. If a customer subscribes for ATX Services, the dealer shall activate the selected ATX Services and the
customer shall complete the acquaintance call before the Eligible Vehicle is released from the dealership. 
  
 C. SUBSCRIPTION AGREEMENTS; FEES FOR ATX SERVICES. BMW shall add the presentation of a Subscription Agreement to the Eligible Vehicles sales/lease
process for BMW dealerships. Prior to releasing any Eligible Vehicle to a customer after purchase/lease thereof, each original owner/lessee of any Eligible Vehicle that desires to subscribe for ATX Services shall complete and execute a Subscription
Agreement, and shall provide ATX with the data contained within the Subscription Agreement in the manner described below. BMW shall require the BMW center to retain a copy of the executed subscriber agreement with the customer records, and to make
such agreement available to ATX upon reasonable request from ATX. BMW shall pay to ATX all fees due for ATX Services and payable by BMW. If the customer does not elect to subscribe for ATX Services, BMW shall use commercially reasonable efforts to
ensure that the customer completes and executes a form reasonably acceptable to ATX that such customer understands that such customer will not have access to the ATX Services. 
  

 9 
 CONFIDENTIAL TREATMENT 

 The Electronic Subscriber Agreement will be used for point of sale registration and for updating
subscribers’ information and services on the bmwusa.com\owner’s circle web site. ATX will have access to the subscriber information in both electronic and paper formats. ATX will be responsible to undertake to maintain a valid subscriber
agreement with the customer after initial vehicle delivery and registration; however, BMW will assist in this process through its retail locations and web site. 
  
 D. MARKETING AND PROMOTION. BMW shall be responsible for the marketing and promotion of the ATX Services, and shall
provide active, ongoing dealer training and channel support for the program as well as support through branding, product advertising, and promotional activity, at its cost. BMW shall provide dealers with marketing materials in support of the program
including, point of sale displays, retailer literature to assist sales people, product brochures, website support, and welcome kits for new owners/lessees. BMW shall develop and implement a process to actively recruit and secure Subscription
Agreements for new and non-activated Eligible Vehicles. ATX shall have the opportunity to participate in the development of all marketing programs related to the delivery of Telematics Services. 
  
 E. GOVERNMENT REGULATION. Notwithstanding anything else contained in
this Agreement, ATX shall not be responsible for complying with any requirement under any Laws that require the user of the Device to obtain a license or permit and to pay a fee or other charge to a governmental agency. In the event BMW elects to
sell the ATX Services to the U.S. Government or a prime contractor selling to the U.S. Government, BMW shall remain solely and exclusively responsible for compliance with all statutes and regulations governing such sales to the U.S. Government. ATX
makes no representations, certifications or warranties whatsoever with respect to the ability of its goods, services or prices to satisfy any such statutes or regulations. 
  
 F. CUSTOMER DATA. BMW shall require its dealers to deliver all customer information requested in the Subscription
Agreement (the “Customer Data”) in an electronic format in form and manner reasonably acceptable to ATX such that the Customer Data is downloaded directly into the ATX database. BMW shall use commercially reasonable effort to confirm that
the Customer Data is complete and accurate before it is delivered to ATX. BMW agrees to timely update the Customer Data promptly after BMW’s receipt of revised data from Customers, and to deliver such updated information electronically to ATX
in formats approved in advance by ATX. ATX may use the Customer Data only: 
  

	 	i.	In connection with the provision of Telematics Services to the Customers, 

  

	 	ii.	For purposes of planning and evaluating new and existing Telematics Services on behalf of BMW, 

  

	 	iii.	For preparing aggregate statistical data that do not disclose specific Customer Data about a particular Customer, and 

  

 10 
 CONFIDENTIAL TREATMENT 

	 	iv.	For complying with legally mandated orders of a governmental authority requesting such information, provided BMW is given written notice prior to any disclosure and a reasonable
opportunity to contest such disclosure, unless disclosure is expressly forbidden by the governmental authority. Should BMW and ATX agree on a standardized process for disclosure, that process will supersede this item iv. 

  
 G. NON-RECURRING ENGINEERING (NRE) FEES. During the term of this
Agreement, with respect to each new program, BMW shall pay to ATX NRE fees as may be mutually agreed upon from time to time by ATX and BMW. 
  

	4.	ADVERTISING, TRADEMARKS AND USE OF NAME. 

  
 A. TRADEMARKS – BMW. BMW may from time to time grant ATX a limited non-exclusive license to use its trademarks, trade names, service marks,
and logos owned by BMW or by its affiliates in connection with the documentation, presentation and marketing of the various services to be provided by ATX. ATX will have no interest in or right to the use of such names, marks, and/or logos, except
the limited right of usage thereof granted in connection with this Agreement and during its term. ATX understands that BMW or its affiliates have adopted guidelines regarding the use of such trademark and logos, including guidelines governing color,
size, typeface, and style, and ATX agrees to comply with all such guidelines of which it is made aware in writing. ATX must submit all materials to BMW for review and approval prior to release. 
  
 B. TRADEMARKS – ATX. ATX may from time to time grant to BMW the
right to use trademarks, trade names, service marks, and logos owned by ATX or by its affiliates in connection with the documentation, presentation and marketing of the various services to be provided by BMW. BMW will have no interest in or right to
the use of such names, marks, and/or logos, except the limited right of usage thereof granted in connection with this Agreement and during its term. BMW understands that ATX or its affiliates have adopted guidelines regarding the use of such
trademark and logos, including guidelines governing color, size, typeface, and style, and BMW agrees to comply with all such guidelines of which it is made aware in writing. BMW must submit all materials to ATX for review and approval prior to
release. 
  

	5.	PROTECTIVE PROVISIONS. 

  
 A. CONFIDENTIAL INFORMATION. This Agreement shall not modify or affect the terms and conditions of the Mutual Confidentiality Agreement between the
parties, dated October 15, 1999, attached hereto as Exhibit E, the terms and conditions of which shall remain in full force and effect. Each of the parties recognizes that due to the nature of its association and relationship with the other, it will
have access to, will acquire, and may assist in developing confidential and 

  

 11 
 CONFIDENTIAL TREATMENT 

 
proprietary information relating to the business and operations of the other. Each of the parties acknowledges that all such confidential information of the
other has been and will continue to be of central importance to the business of the other, and that the use of such confidential information for its own account, or the disclosure of it to or its use by others would cause substantial loss and
irreparable harm to the owner of the confidential information. Neither party shall use for its own account, or disclose to any person, corporation, firm, partnership, association or other entity, directly or indirectly: (a) any confidential
information regarding the other’s technologies, processes, or strategies; (b) any other confidential information relating to the other’s business; and (c) any other confidential information the disclosure of which would have an adverse
effect on the business of the other. Notwithstanding the foregoing, nothing in this Section 5 shall prevent either party from using information obtained from the other party to the extent such information (a) is already in the possession of
the receiving party at the time of the disclosure, (b) is developed independently by the receiving party without violating the disclosing party’s proprietary rights, (c) is obtained from a source other than the disclosing party under no
obligation of confidentiality to the disclosing party, (d) is publicly available when received, or which thereafter becomes publicly available other than through any unauthorized disclosure by, through, or on behalf of, the receiving party, or (e)
is required to be disclosed by the receiving party by judicial or administrative process, provided that the non-disclosing party is given reasonable prior written notice sufficient to permit the non-disclosing party to contest such disclosure. This
Section 5 shall survive any termination or expiration of the Agreement. 
  
 B. CUSTOMER INFORMATION. The parties acknowledge that during the term of this Agreement, ATX, on behalf of BMW, shall be collecting confidential and proprietary information provided by customers who subscribe
to the Services hereunder. ATX acknowledges that all such information, including, but not limited to, customer names, addresses, credit card numbers and account history (“Customer Information”), belongs to BMW. ATX shall not sell, license,
rent, use or otherwise exploit Customer Information, and shall only access and employ Customer Information to fulfill its duties and responsibilities hereunder. Moreover, ATX shall adhere to and comply with the BMW Privacy Policy, attached hereto as
Exhibit F. BMW shall own all rights, and have complete and unfettered access to Customer Information upon advance notice. 
  
 C. NON-SOLICITATION. Neither party shall, unless consented to in writing by the other, directly or indirectly solicit for employment or offer
employment to any managerial, technical or other key employee of the other party (whether on its own behalf or on behalf of a third party) for a period of one year after the employee has worked on the soliciting party’s account. 
  

 12 
 CONFIDENTIAL TREATMENT 

	6.	TERM AND TERMINATION. 

  
 A. TERM. This Agreement shall commence on January 1, 2002 and shall continue for an initial term through December 31, 2004. Following the initial
term, this Agreement shall automatically renew for additional one-year periods unless at least six (6) months prior to the commencement of any such additional one-year period, either party gives written notice to the other party of its intention not
to renew the Agreement. 
  
 In the event BMW terminates this
agreement for any reason, ATX shall assist BMW in good faith to develop and implement a transition plan to enable BMW to minimize the impact of such termination on its telematics customers. BMW shall reimburse ATX for its reasonable expenses
incurred to assist BMW to develop and implement any transition plan. In connection with its assistance, ATX shall make customer data available to BMW or its new third party service provider. ATX shall not be required to disclose confidential
information of ATX. 
  
 B. ANNUAL REVIEW. On an annual
basis starting in June 2002, the parties shall meet in good faith to review the wholesale and retail pricing for the ATX Services in anticipation of pricing adjustment for the upcoming model year introduction in September. Such review shall also
include an evaluation of the accuracy of call routing by call type as more specifically outlined in the BMW Operating Procedures. The parties may also make adjustments to the pricing structure whenever a new model is introduced. If, during the
annual review the parties mutually agree to modify the pricing for the ATX Services, the parties shall enter into an appropriate amendment to this Agreement in a form satisfactory to the parties. 
  
 C. TERMINATION FOR NON-PERFORMANCE. Either party may terminate this
Agreement at any time for material breach or default by the other party. In the event that either party desires to terminate this Agreement for material breach or default, that party must first provide to the other party prior written notice of the
material breach or defaults and afford that party no less than ninety (90) business days within which to cure any such material breach or defaults. If no cure is successful in eliminating the material breach or defaults within the ninety (90)
business day period following the delivery of the notice of material breach or default, then the aggrieved party shall notify the other party of failure to cure and may terminate the Agreement effective with such notice of failure to cure.
Notwithstanding the forgoing, the cure period for any nonpayment of fees due by BMW to ATX for services rendered shall be sixty (60) days. 
  

 13 
 CONFIDENTIAL TREATMENT 

 D. RIGHT OF THE PARTIES IN THE EVENT OF TERMINATION OR NON-RENEWAL. This Section 6D shall
survive any termination or expiration of this Agreement. Upon expiration or termination of this Agreement for any reason the parties shall have the following rights: 
  
 (1) Each party shall return to the other all documents, materials, reports, Customer Information, customer data, or other
information, or copies thereof, and any Confidential Information, which were received from the other party for use in the course of this Agreement. 
  
 (2) Each party shall cease to use any of the others marketing materials, trademarks, trade names or logos. 
  

	7.	INDEMNIFICATION; RELEASE. This Section 7 shall survive any termination or expiration of this Agreement. 

  
 A. ATX INDEMNIFICATION. ATX will indemnify, defend and hold BMW and
any of its affiliated companies, and the officers, directors, agents, employees, and assigns of each, harmless from and against any and all actions, claims, demands, losses, liabilities, costs and expenses, including attorneys’ fees, to the
extent arising from ATX’s breach of any material obligation of ATX hereunder, regardless of the form of action (and including negligence, willful misconduct, failure to comply with the Fair Credit Reporting Act, or failure to comply with any
other Laws), and any action, claim, demand, loss or liability based upon, arising out of, or in any manner resulting from any false or misleading written statement delivered by ATX to BMW for use in marketing materials, customer statements or other
similar documents for BMW’s customers. 
  
 B. BMW
INDEMNIFICATION. BMW will indemnify, defend and hold ATX and any of its affiliated companies, and the shareholders, officers, directors, agents, employees, and assigns of each, harmless from and against any and all actions, claims, demands,
losses, liabilities, costs and expenses, including attorneys’ fees, to the extent arising from BMW’s breach of any material obligation of BMW hereunder, regardless of the form of action (and including negligence, willful misconduct, or
failure to comply with any Laws), and any action, claim, demand, loss or liability based upon, arising out of, or in any manner resulting from (1) any allegation of a design or manufacturing defect in any Vehicle or the Devices; or (2) any
allegation that any marketing materials, customer statements, or other similar documents created by BMW for the program contain any false or misleading statement; (3) the disclosure or use by ATX of Customer Data in a manner requested or directed by
BMW. 
  
 C. RELEASE. BMW understands, acknowledges and
agrees that ATX will contact certain agencies and persons (including without limitation public safety answering points, roadside assistance providers and concierge service providers) authorized by BMW’s customers to receive Device location
information, and that ATX has no obligation to telephone any emergency agency or person other than the agency or person(s) named in the Customer Data or otherwise authorized by BMW for reasons including but not limited to theft recovery of BMW owned
vehicles. BMW understands that ATX is responsible only for using its best 

  

 14 
 CONFIDENTIAL TREATMENT 

 
efforts to notify by telephone the appropriate emergency agency or other person named in the Customer Data. BMW also understands that ATX does not promise
that anyone telephoned by it will respond to the call. BMW also understands that ATX may be required by judicial or administrative process to disclose Customer Data or tracking information, in which event, ATX will provide BMW with reasonable
written notice sufficient to provide BMW with an opportunity to contest such disclosure. The parties agree to cooperate in good faith and share the cost to contest such disclosure. BMW hereby releases and forever discharges ATX and its shareholders,
directors, officers, employees, and affiliates, from any and all liabilities, losses, claims, demands, actions, damages, injuries and expenses of every kind and nature (collectively, “Losses”) arising out of or relating to any claim that
ATX was not authorized to contact the agencies and persons, provided ATX was so authorized by a BMW customer or BMW (or by judicial or administrative process) to receive Device location information in accordance with the terms hereof, or for failure
or delay by such agencies or persons in responding, and BMW shall indemnify ATX for any Losses incurred by ATX in connection with any claim by any BMW customer that ATX was not authorized to contact the agencies and persons who ATX was in fact
authorized by such customer or BMW to receive Device location information in accordance with the terms hereof or that any authorized persons or agencies failed to respond or delayed in responding to such customer. 
  

	8.	INSURANCE. ATX will secure and maintain at its sole cost and expense, during the entire term of this Agreement, insurance coverage as outlined in Exhibit G attached hereto
and shall, upon request, furnish a certificate(s) evidencing such insurance coverage by forwarding such certificates to BMW. ATX’s failure to maintain insurance coverage as outlined in Exhibit G may constitute a material breach. Nothing herein
shall limit or prohibit BMW from obtaining insurance for its own account and any proceeds payable thereunder shall be payable as provided in the underlying policy. 

  

	9.	RIGHT TO AUDIT. ATX shall maintain accurate and complete records of all services performed pursuant to this Agreement for at least one (1) year following the delivery of such
services, in accordance with the BMW Operating Procedures. On an annual basis, ATX will store the records on permanent storage and deliver the data in form reasonably acceptable to and accessible by BMW for storage thereafter. BMW or its designated
representatives shall have the right, at BMW’s expense, from time to time, but no more frequently than twice annually, upon reasonable notice and during regular business hours, to inspect and audit those books and records of ATX which relate
directly to this Agreement and the services performed hereunder. ATX shall cooperate with BMW in the conduct of any such inspection and audit. 

  

 15 
 CONFIDENTIAL TREATMENT 

	10.	GENERAL. This Section 10 shall survive termination or expiration of this Agreement. 

  
 A. NO LICENSE TO ATX INTELLECTUAL PROPERTY. Nothing contained in the Agreement will be deemed to grant either
directly or by implication, estoppel, or otherwise, any license under or any right to use any patents, copyrights, trademarks, service marks, trade names or trade secrets of ATX, except as set forth herein. 
  
 B. NO LICENSE TO BMW INTELLECTUAL PROPERTY. Nothing contained in the
Agreement will be deemed to grant either directly or by implication, estoppel, or otherwise, any license under or any right to use any patents, copyrights, trademarks, service marks, trade names or trade secrets of BMW, except as set forth herein.

  
 C. NOTICES. In the event of the serving of any notice,
service shall be made personally or by Federal Express or other nationally recognized overnight courier, or registered or certified mail, return receipt requested, postage prepaid, and the notice shall be effective only upon receipt by the party
being served with the notice. Notices shall be addressed to the parties as follows: 
  
 If to BMW: 
  
 BMW of North
America, LLC 
 300 Chestnut Ridge Road 
 Woodcliff Lake, NJ 07677-7731 
 Attn: Purchasing Manager 
 cc: General Counsel 
 Fax: (201) 307-9286

  
 If to ATX: 
  
 ATX Technologies, Inc. 
 8550 Freeport Parkway 
 Irving, Texas 75063

 Attn: President 
 cc: General
Counsel 
 Fax: 972-753-6275 
  
 Each party is responsible for informing the other of any changes in its address by sending proper written notice to the other. 
  
 D. GOVERNING LAW. The validity, interpretation and construction of
this Agreement, and all other matters related to this Agreement, shall be governed and interpreted by the laws of the State of New York. 
  
 E. ATTORNEYS’ FEES. Should either party institute or participate in a legal or equitable proceeding against the other to enforce or interpret
this Agreement, the non-prevailing party shall pay the prevailing party’s costs, expert 

  

 16 
 CONFIDENTIAL TREATMENT 

 
and professional fees, reasonable attorney’s fees and all other costs incurred by the prevailing party in preparation for the proceeding. 
  
 F. ENTIRE AGREEMENT/AMENDMENT. This Agreement, together with its
attached Exhibits, constitutes the entire agreement between the parties with respect to the subject matter hereof, and supersedes any and all prior expressions, whether written or oral, except this Agreement shall not modify or affect the terms and
conditions of the Mutual Confidentiality Agreement between the parties, dated October 15, 1999, the terms and conditions of which shall remain in full force and effect. Each party acknowledges that it is not entering into this Agreement on the basis
of any representations, which are not expressly stated herein. No amendments, alterations, or modifications of this Agreement may be made unless in writing signed by both parties. 
  
 G. SEVERABILITY. If any of the provisions of this Agreement are held by a court of competent jurisdiction to be
unenforceable or invalid, then such provisions will be ineffective to the extent of the court’s ruling. All remaining portions of the Agreement shall remain in full force and effect. 
  
 H. ASSIGNMENT. Neither party may assign this Agreement or delegate
its duties hereunder without the prior written consent of the other party except that either party may assign this Agreement to any entity controlling, controlled by, or under common control with such assigning party. The provisions hereof will be
binding upon and inure to the benefit of the parties, their successors and permitted assigns. If BMW chooses to permit the assignment of the contract, then BMW will be entitled, prior to such assignment, to specify the circumstances under which the
assignment will occur, including the extent to which the assignee obtains proprietary or confidential information of BMW. 
  
 I. PARAGRAPH HEADINGS AND INTERPRETATION. The paragraph headings contained herein are for reference only and will not be considered substantive
parts of this Agreement. The use of the singular or plural shall include the other form. Similarly, when applicable, a reference to one gender shall include the other. No provision of this Agreement will be interpreted in favor of, or against,
either of the parties hereto by reason of the extent to which such party or its counsel participated in the drafting thereof or by reason of the extent to which any such provision may be inconsistent with any prior draft hereof or thereof.

  
 J. NO WAIVER. Upon a party’s breach or default
hereunder, the other party’s failure, whether single or repeated, to exercise a right hereunder shall not be deemed to be a waiver of that right as to any future breach or default. 
  
 K. FORCE MAJEURE. Neither party will be liable to the other for any delay or failure in performance under this
Agreement (excluding payment obligations) to the extent that such delay or failure results from acts of nature, civil unrest or 

  

 17 
 CONFIDENTIAL TREATMENT 

 
other calamities, labor strikes, communications or power failures, transportation delays, or subsequently enacted governmental regulations, but only to the
extent such events are outside the non-performing party’s reasonable control. Such excuse for delay or failure in performance provided by this section will apply only during the existence or occurrence of the pertinent event, and for a
reasonable time thereafter. 
  
 L. NATURE OF RELATIONSHIP.
Under this Agreement, the parties shall be independent contractors. By entering into this Agreement, the parties do not intend to create a partnership, joint venture, agency, or employment relationship, or to grant a franchise under federal or state
law. Neither party has authority to act on the other’s behalf without specific authority. 
  
 M. NO IMPLIED RIGHTS OR REMEDIES. Except as otherwise expressly provided herein, nothing herein is intended or shall be construed to confer upon or
give to any person, organization, or business (in any form) other than the parties hereto and their respective successors and permitted assigns, any rights or remedies under or by reason of this Agreement. 
  
 N. SURVIVAL. The provisions of this Agreement which are expressly
stated to survive the termination of this Agreement, and the provisions of this Agreement which by their nature are intended to survive termination of this Agreement, including without limitation all representations, warranties and indemnification
obligations of the parties, shall survive any termination or non-renewal of this Agreement. 
  
 O. COUNTERPARTS. This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were on the same instrument.

  
 IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the
date first indicated above. 
  

									
	 BMW OF NORTH AMERICA, LLC
	 	 	 	 ATX TECHNOLOGIES INC.

					
	By:	 	 	 	 	 	By:	 	 
	 	 	
	 	 	 	 	 	

					
	 Printed Name:
	 	 	 	 	 	 Printed Name:
	 	 
	 	 	
	 	 	 	 	 	

					
	 Title:
	 	 	 	 	 	 Title:
	 	 
	 	 	
	 	 	 	 	 	

  

 18 
 CONFIDENTIAL TREATMENT 

									
					
	By:	 	 	 	 	 	By:	 	 
	 	 	
	 	 	 	 	 	

					
	 Printed Name:
	 	 	 	 	 	 Printed Name:
	 	 
	 	 	
	 	 	 	 	 	

					
	 Title:
	 	 	 	 	 	 Title:
	 	 
	 	 	
	 	 	 	 	 	

  
 Schedule of Exhibits 
  

	 	A.	ATX Services 

  

	 	B.	Payment Terms 

  

	 	C.	BMW Operating Procedures 

  

	 	D.	Subscription Agreement 

  

	 	E.	Confidentiality Agreement 

  

	 	F.	Privacy Policy 

  

	 	G.	Insurance Requirements 

  

 19 
 CONFIDENTIAL TREATMENT 

 EXHIBIT A 
  

ATX SERVICES 
  
 ATX will deliver Telematics Services to subscribers owning and/or leasing BMW vehicles equipped with a navigation system and the Akira Telematics Control Unit, as well as all vehicles to be equipped with the Everest
Telematics Control Unit. 
  
 ATX will support the development and porting of its
services for registration, renewals and accessing at bmwusa.com/owner’s circle. 
  
 The following service description tables are for illustrative purposes only. The full description of service implementation and service delivery can be found in the BMW Operating Procedures. 
  

 20 
 CONFIDENTIAL TREATMENT 

 Akira Telematics Control Unit, February 2001-August 2002 production 
  

					
	 Service Package

	  	 Service Name

	  	 Service
Description

	 	  	 Automatic collision notification
 (3 year duration of service from date of retail delivery,
 paid by BMW)
	  	***
			
	Safety & Security Package	  	 Emergency assistance
 (3 year duration of service from date of retail delivery,
 paid by BMW)
	  	***
	  	 Roadside assistance
 (3 year duration of service from date of retail delivery,
 paid by BMW)
	  	***
			
	 	  	 Security system notification
 (3 year duration of service from date of retail delivery,
 paid by BMW)
 I-bus vehicles only (excludes new 7 Series, E65)
	  	***

  
  
 ***Confidential material redacted and filed separately with the Commission 
  

 21 
 CONFIDENTIAL TREATMENT 

 Everest Telematics Control Unit, Commencing September 2002 Production 
  
 It is BMW NA’s intention to introduce this new hardware platform effective with its
2003 Model Year launch in 9/02. In the event that the supporting infrastructure (including but not limited to vehicle hardware, software, wireless network compatibility, call center readiness, etc.) is not ready to support this launch, BMW intends
to continue with the Akira platform per the above program. Rollout of the Everest TCU may be by Series, rather than across all series, dependent on vehicle readiness. BMW shall not be held liable by ATX for any delay in the launch of the Everest
platform, or subsequent loss in potential revenues. 
  
 Products listed in the
following tables may be introduced in phases as mutually agreed by both BMW and ATX. 
  

					
	 Service Package

	  	 Service Name

	  	 Service
Description

	 	  	Automatic collision notification	  	***
			
	Safety & Security Package (1 year duration of service from date of retail delivery, paid by BMW)	  	Emergency assistance	  	***
	  	Roadside assistance	  	***
			
	 	  	 Security system notification I - bus vehicles only (excludes new 7 Series, E65) (1 year duration of service from date of delivery,
paid by BMW)
	  	***

  
  
 ***Confidential material redacted and filed separately with the Commission 
  

 22 
 CONFIDENTIAL TREATMENT 

							
	 Service Package

	  	 Service Name

	  	 Service Description

	  	 Current
 Third Party
Supplier

	Convenience Package (customer option)	  	Real time traffic	  	***	  	Westwood One/ Tele Atlas
	  	 	  	 	  	 
	  	 Route guidance
	  	***	  	NavTech GDT Telcontar
	  	 	  	 	  	 
	  	 Convenience info (ATMs, gas, hotels)
	  	***	  	POIs: InfoUSA Maps: NavTech GDT Telcontar
	  	 	  	 	  	 
	  	 Concierge (tickets, reservations, flowers)
	  	***	  	Prestige
	  	 	  	 	  	 
	  	 Customer Relations
	  	***	  	BMW FS

  
  
 ***Confidential material redacted and filed separately with the Commission 
  

 23 
 CONFIDENTIAL TREATMENT 

							
	 Service Package

	  	 Service Name

	  	 Service
Description

	  	 Current
 Third Party
Supplier

	Online Package (New 7 Series, E65 only, customer option)	  	 Info (weather, news, finance, traffic, sports)
	  	***	  	CNN & Westwood One/ Tele Atlas
	  	 	  	 	  	 
	  	 PIM - personal info management
	  	***	  	Unknown
	  	 	  	 	  	 
	  	 Online services (e-mail, yellow pages)
	  	***	  	Unknown
				
	 Service Package

	  	 Service Name

	  	 Service
Description

	  	 
	TeleService (duration of vehicle warranty, paid by BMW)	  	 Service request
	  	***	  	 

  
  
 ***Confidential material redacted and filed separately with the Commission 
  

 24 
 CONFIDENTIAL TREATMENT 

 EXHIBIT B 
  
 PAYMENT TERMS 
  
 Akira Platform 
  
 Safety & Security Package: 
  
 ***/year/customer 
  
 Service pricing includes
incoming ATX related 800# telephone costs, data entry and acquaintance calls (3 minute target) 
  
 Security System Notification: 
  
 Call data and volume recorded w/o response, *** 
  
 Everest
Platform 
  
 TeleService: 
  
 ***/year/customer, calendar year 2002 only, to obtain baseline cost
data on approximately 4000 7 Series Everest-equipped vehicles to be activated with this capability over the last 3 months of 2002. ATX will evaluate, track and share usage and expenses associated with providing this service in order to establish
appropriate service pricing beginning January 1, 2003. 
  
 Safety &
Security Package: 
  
 ***/year/customer 
  
 Service pricing includes incoming ATX related 800# telephone costs, data
entry and acquaintance calls (3 minute target) 
  
 Security System
Notification: 
  
 Call data and volume recorded w/o
response, *** 
  
 Convenience Package: 
  
 ***/year/customer for less than 10k subscribers, 
  
 ***/year/customer for more than 10k but less than 20k subscribers,

  
 ***/year/customer for more than 20k subscribers

  
 Convenience package pricing includes content provider license fees for
existing providers, Prestige International (Concierge) and ATX call center (Traffic, route guidance and convenience info). This pricing assumes annual billing (paid annually by the customer in advance each year, commencing with vehicle delivery
and/or subscription to this service) and that the vehicle dials a 972 or similar area code number that is local to the ATX call center. All pricing is subject to review, contingent upon content provider re-negotiations (e.g., Westwood One instead of
Etak, NavTech under BMW contract, etc). 
  
 Content providers and licensors can be
changed, subject to BMW approval, which will not be unreasonably withheld. Investigation and integration related to a change in content 
  
  
 ***Confidential material redacted and filed separately with
the Commission 
  

 25 
 CONFIDENTIAL TREATMENT 

 
providers will involve technical and economic evaluation. Approval by both parties will include documentation of responsibility for development and licensing
fees. The expectation is that if ATX suggests a change in existing ATX content providers, then ATX will bear development and ongoing licensing of costs. If BMW suggests a change in any content providers, BMW will bear the development and ongoing
licensing costs. 
  
 Online Package: 
  
 ***/year/customer 
  
 Online package pricing includes existing content providers’ license fees, including
those listed as “unknown” in Exhibit A for PIM and Online Services. This pricing assumes annual billing (paid annually by the customer in advance each year, commencing with vehicle delivery and/or subscription to this service) and that the
vehicle dials a 972 or other area code number, local to the ATX call center. 
  
 Content providers and licensors can be changed, subject to BMW approval, which will not be unreasonably withheld. Investigation and integration related to a change in content providers will involve technical and economic evaluation.
Approval by both parties will include documentation of responsibility for development and licensing fees. The expectation is that if ATX suggests a change in existing ATX content providers, then ATX will bear development and ongoing licensing of
costs. If BMW suggests a change in content providers, BMW will bear the development and ongoing licensing costs. 
  
 Usage Assumptions 
  
 Pricing is based on usage assumptions in the following table: 
  

							
	 	  	 SERVICE

	  	 Avg. Number of Calls per Year per
subscriber

	  	 Avg. Time Per Incident

	 	  	TeleService	  	*** times per year	  	*** SMS
			
	 Safety &
 Security
	  	 Automatic Collision Notification
 Emergency
 Breakdown
	  	Pricing based on ATX maintaining a *** capacity operations staff to meet 24 x 7 operating environment with performance metrics as expressed elsewhere in this agreement. ATX has
based pricing of these services on experience since model year 1996.
	

				
	 	  	Real time traffic (non navi)	  	*** per week - *** per week
(***)	  	*** seconds(assumption based on personalized traffic)
				
	 	  	Real time traffic (navi)	  	 *** per week - *** per week

 (***)
	  	*** SMS packets/request
				
	 	  	Route guidance (non-navi)	  	*** per year	  	*** minutes
				
	 	  	Route guidance (navi)	  	*** per year	  	*** SMS packets/request
				
	 Convenience
	  	 Convenience info
 (ATMs, gas, hotels) (navi)
	  	*** per year	  	*** SMS packets/request
				
	 	  	 Concierge
 (tickets, reservations, flowers)
	  	*** per year	  	 *** Minutes ATX time,
 *** Minutes Prestige
time

				
	 	  	Customer Relations	  	*** per year	  	*** minutes
				
	 On-Line
	  	 Info
 (weather, news, finance, sports)
	  	 ***X a day weekdays=***
 ***X on
weekends=***
	  	*** minutes via WAP.
	  	 PIM - personal info
 management
	  	 ***X a day weekdays=***
 ***X on
weekends=***
	  	*** Minutes via WAP
	  	 Online services
 (e-mail, yellow pages)
	  	 ***X a day weekdays=***
 ***X on
weekends=***
	  	 E-Mail: *** Minutes via WAP
 Yellow Pages: *** Minutes
via WAP

	

  
 Pricing assumptions for all packages
contemplate accurate service selection by customers (e.g., “Emergency” vs. “Assist”) and above usage assumptions. The parties shall evaluate 
  

 
 ***Confidential material redacted and filed separately
with the Commission 
  

 26 
 CONFIDENTIAL TREATMENT 

 
actual service selection accuracy and usage history and its impact on the pricing structure during the annual pricing review. The pricing for the subsequent
calendar year shall be mutually agreed upon by the parties, taking into consideration the current year’s service selection accuracy and usage history, as well as documented cost of services, which are designed to be reduced annually through ATX
efforts to improve operating efficiencies, content/third party price reductions and economies of scale. 
  
 Safety & Security Package Payments 
  
 BMW NA agrees to pay for 3 years of service from the date of retail delivery for Akira-equipped vehicles that remain in service within the United States and with an activated phone. BMW NA agrees to pay for 1 year of service from the date
of retail delivery for Everest-equipped vehicles that remain in service within the United States. Payments for services on these vehicles will be made monthly, based upon the total quantity of covered vehicles in service for the prior month. The
payment per vehicle will be one twelfth of the current annual charge. 
  
 By the
tenth of each month, BMW NA will provide ATX with a list of Akira and Everest-equipped vehicles delivered the prior month, as well as any vehicles removed from service. On the basis of such list, ATX will calculate the running total of vehicles in
BMW paid service and bill BMW NA accordingly. BMW shall make payment to ATX, in the manner requested by ATX, net 30 days. Each month, ATX will advise BMW of the total quantity of active Safety & Security Package subscribers, as well as the
subscribers’ expiration months. 
  
 Since Akira-equipped vehicles may have
been delivered to retail customers as early as January 15, 2001, prior to the formal initiation of service on January 1, 2002, BMW will provide ATX with a list of the Akira-equipped vehicles (“legacy vehicles”) delivered to retail
customers each month in 2001. These vehicles will form the basis of ATX’s first bill to BMW. 
  
 Customers will have the option to pre-pay for future annual renewals of the Safety & Security Package at the point of vehicle sale (POS). The Parties agree that at initial launch of the Telematics Services,
customer will be required to pre-pay for future years of the Safety & Security Package with a credit card. BMW may establish other methods of customer payment after the program is launched. ATX agrees to work in good faith with BMW to establish
other methods of customer payment, as BMW may deem appropriate. Since ATX receives payment, ATX shall retain its current agreed wholesale optional package charge for the entire year and remit the balance of the retail price to BMW. ATX will advise
BMW each month of the total quantity of active subscribers per optional package, as well as the subscribers’ expiration months. 
  
 After the BMW or customer pre-paid period expires, ATX will be responsible for the solicitation and renewal of the Safety & Security Package with the current BMW
owner. Renewal efforts shall be coordinated with BMW and shall be undertaken via the subscriber’s preferred communication format, e.g., postal mail, e-mail, and/or telephone. 

  

 27 
 CONFIDENTIAL TREATMENT 

 
ATX will not contact customers while they are in the vehicle, via the telematic device and service to solicit renewals. ATX will bear the entire costs
associated with renewal activities. ATX will bill customers annually for renewal charges. On a monthly basis and for each payment made by a customer, ATX shall retain the agreed upon wholesale renewal charges and remit the balance of the retail
price to BMW. 
  
 Within 5 business days of the end of the month, all funds due to
BMW (net of ATX fees) will be wired to a BMW account and all required reports will be provided electronically to BMW’s Finance & Administration department program management and other groups as required by BMW. This structure provides for
the timely and clean transfer of funds, minimizes the number of wire transfers between companies and fulfills ATX’s requirement of payment prior to the rendering of services. 
  
 Convenience and Online Package Payments (Optional Packages) 
  
 Customers will be solely responsible for the annual payment of optional packages. The Parties agree that at initial launch of the Telematic
Services, customer will be required to pay for the optional packages with a credit card. BMW may establish other methods of payment after the program is launched. ATX agrees to work in good faith with BMW to establish other methods of customer
payment, as BMW may deem appropriate. Since ATX receives payment, ATX shall retain its current agreed wholesale optional package charge for the entire year and remit the balance of the retail price to BMW. ATX will advise BMW each month of the total
quantity of active subscribers per optional package, as well as the subscribers’ expiration months. 
  
 After the initial customer-paid period expires, ATX will be responsible for the solicitation and renewal of the optional package(s) with the current BMW owners. ATX will be responsible for maintaining a valid
subscriber agreement with the customer. All costs associated with these activities will be borne in their entirety by ATX. 
  
 Within 5 business days of the end of the month all funds due to BMW (net of ATX fees) will be wired to a BMW account and all requested reports provided electronically to
BMW’s Finance & Administration Department, program management and other appropriate groups. This structure provides for the timely and clean transfer of funds, minimizes the number of wire transfers between companies and fulfills ATX’s
requirement of payment prior to the rendering of services. 
  
 In the event that
BMW wishes to extend a free period of service of these optional packages to select customers, it shall pay ATX for these services on a monthly basis (one twelfth of the current wholesale rate) for the subject vehicles. 
  

 28 
 CONFIDENTIAL TREATMENT

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