GENERAL MAGIC INC
EXHIBIT 10.1
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<TYPE>EX-10.1
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<FILENAME>f81439ex10-1.txt
<DESCRIPTION>EXHIBIT 10.1
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                                                                    EXHIBIT 10.1



            AMENDMENT NUMBER TWO TO DEVELOPMENT AND LICENSE AGREEMENT
                                 BY AND BETWEEN

                             GENERAL MAGIC, INC. AND

                           GENERAL MOTORS CORPORATION


        This Amendment Number Two ("Amendment"), dated as of the last date
signed below, amends the Development and License Agreement, dated November 9,
1999, as amended by Amendment Number One on August 1, 2001, (collectively, the
"Agreement") by and between General Magic, Inc. ("Magic"), on the one hand, and
General Motors Corporation, by and through its subsidiary, OnStar Corporation
("OnStar"), on the other (together the "Parties").

        Whereas, as of the date of this Amendment, Magic has developed and
continues to develop the magicTalk Voice Gateway, which is server software
designed to enable telephone access to enterprise applications by integrating
speech recognition, text-to-speech and telephony technologies with a VoiceXML
interpreter to enable voice access to information and services from any
telephone. The Parties anticipate that Magic will develop future versions of the
magicTalk Voice Gateway (collectively, along with the current version, V1.6, the
"Gateway").

        Whereas, as of the date of this Amendment, Magic has developed and
continues to develop the magicTalk Enterprise Platform, a suite of
enterprise-class voice infrastructure software designed for Web/Java developers
to accelerate voice application development, integration and deployment. The
Parties anticipate that Magic will develop future versions of the magicTalk
Enterprise Platform (collectively, along with the current version, V1.0, the
"Enterprise Platform").

        Whereas, Magic has developed and continues to develop the OnStar Service
(as defined in the Agreement), and hosts the OnStar Service for OnStar. The
OnStar Service as of the date of this Amendment contains many grammars, voice
prompts and scripts, some of which existed prior to the date of the Agreement
and some of which are OnStar Items (as defined in the Agreement).

        Whereas OnStar wishes to make all non-domain-specific grammars, voice
prompts and scripts for the OnStar Service available to Magic for Magic use in
the Gateway, the Enterprise Platform and other Magic software products.

        Whereas, with respect to the OnStar Service, Magic wishes to make (a)
all recordings, source code and interpreted code (such as XML) for the voice
user interface and graphical user interface and (b) all source code for the
software that makes up the integration layer (but not what is referred to by the
Parties as the "middle layer") between (i) OnStar's network back-end and (ii)
the OnStar Service ((a) and (b) together the "Application Source Code")
available to OnStar.

        And whereas, the Parties wish to confirm their understanding of OnStar's
rights to use the Gateway.


                                       1.

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        Now, therefore, the Parties agree as follows:

        1. To the extent not already provided by the Agreement, OnStar grants to
Magic a worldwide, perpetual and irrevocable, non-transferable (except as
provided in Section 12.7 (Assignment) of the Agreement), non-exclusive,
royalty-free and fully paid license, to use, reproduce, perform, display,
distribute, modify, and create derivative works and other Improvements to the
recordings, source code, interpreted code (such as XML) and object code to the
grammars, voice prompts and scripts contained in the OnStar Items created during
the term of the Agreement for the purpose of making, having made, using,
selling, offering to sell and importing any software product, excluding custom
solutions developed by or on behalf of GMI for third parties in the Field of Use
(as defined in the Agreement); provided, however, that this license shall not
include rights in any domain-specific grammars, voice prompts or scripts
contained in the OnStar Items. For the purposes of clarification, a "domain"
consists of a set of services addressing a specific subject matter, such as
weather, traffic, sports and so on. A grammar, voice prompt or script that is
not domain-specific can be used across different domains without modification.

        2. To the extent not already provided by the Agreement, Magic grants to
OnStar a worldwide, perpetual and irrevocable, non-transferable (except as
provided in Section 12.7 (Assignment) of the Agreement), non-exclusive,
royalty-free and fully paid license, to use, reproduce, perform, display,
distribute, modify, and create derivative works and other Improvements to the
Application Source Code for the purpose of modifying, extending and operating
the OnStar Service in the Field of Use. For purposes of clarification only, the
Application Source Code does not include source code to the Gateway or the
Enterprise Platform.

        3. The Parties confirm that the Gateway is considered an Improvement to
the Magic Background Technology under the Agreement and that the term "Magic
Software" shall include the Gateway.

        4. The Parties confirm that the rights and obligations of the Parties
with respect to all software delivered by Magic to OnStar are governed solely by
the terms and conditions of the Agreement.


Agreed this 10th day of January, 2002.


GENERAL MAGIC, INC.                               GENERAL MOTORS CORPORATION

By: /s/ KATHLEEN M. LAYTON                        By: /s/ ROD EGDORF
    -------------------------                         ----------------------
Name: Kathleen M. Layton                          Name: Rod Egdorf
Title: President and Chief Executive Officer      Title: Vice President


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