try pulling the bottom seat (cushion) up... open the side door and pull from the bottom corner of the seat up, then do the other side until the whole bottom seat is loose. You will hear a snap sound. To put the seat back, push the corners down on each side, you'll hear the snap sound again.
I was not aware about this LED light on the dashboard... sounds like an aftermarket alarm... Check the rear seat and see if the unit is there...
Also, there is some good info on this site, CIRCLEBMW.COM
Go to the service icon and click on tech information for additional info regarding the alarm unit.