EXHIBIT 10.18
QOMLINQ
Extended Warranty Letter Agreement
Via Email
June 26, 2001
Mr. Xxx Few Sr.
Xx. Xxx XxXxxx
King Central
000 X. Xxxxx Xxxxxx
Xxxxxxxxxx, Xxx Xxxxxx
Gentlemen:
On behalf of QOMLINQ, Xxxx Harbor Insurance Service and ACE USA / Westchester
Specialty Services, we would like to express our appreciation for your interest
in our Insured Extended Warranty ("IEW") Program for alarm systems.
We have enjoyed our association with XxXxxx, Xxxxx & Company over the years, and
we look forward to a new and mutually profitable relationship with King Central.
This Letter Agreement is designed to cover special considerations granted by
QOMLINQ to King Central as it relates to (1) the assistance of King Central in
the marketing and distribution of the IEW to alarm dealers that are currently
utilizing King Central for (a) alarm monitoring services and/or (b) are selling
or financing alarm contracts under a King Central dealer program, and (2) the
purchase of IEW coverage for accounts owned by King Central or any third party
entity in which King Central or its principals are equity holders. (The terms
and conditions relating to items (1) and (2) above are set forth separately
below.)
1. MARKETING AND DISTRIBUTION OF IEW:
X. Xxxx Central has relationships with approximately 4,000 security
alarm dealers ("King Dealers"). It is the desire of QOMLINQ and King
Central to make the IEW Program available to King Dealers through
the marketing efforts of King Central on behalf of QOMLINQ.
X. Xxxx Central is a wholesale monitoring company providing monitoring
services to independent alarm dealers. During the term of this
Agreement it is the desire of King Central that they have the
exclusive right to be the only wholesale monitoring company with the
right to market the IEW to independent alarm dealers. QOMLINQ hereby
grants to King Central the right to be the only wholesale monitoring
company with the right to market the IEW Program to independent
alarm dealers for the period of one year, beginning July 1, 2001,
subject to minimum production requirements equal to a total of 2000
individual IEW issued by the end of the first quarter and 4,000
written individual IEW per month thereafter. In the event the
minimum production requirement is not attained, all terms and
conditions of this Agreement shall remain in effect with the
exception of the exclusive right, which shall
QOMLINQ
0000 Xxxxxx Xxxxx Xxxxxxxxx, XX 00000
become non-exclusive. Nothing contained herein shall preclude
QOMLINQ from marketing or distributing IEW, during any exclusive or
non-exclusive periods of this Agreement, directly or through any
other source with the exception of wholesale monitoring companies as
describe above.
X. Xxxx Central may private label the IEW as the King Central Insured
Extended Warranty Program for alarm systems.
D. The following modifications have been made to the IEW as follows,
all of which shall be included within the terms and conditions of
this Agreement.
1. The labor reimbursement rate to King Dealers shall be increased
to $65 per hour from the original $50 per hour. The maximum of
$100 labor per claim shall remain unchanged. Parts shall
continue to be reimbursed at dealer cost, pius 25%.
2. The dealer cost for the IEW shall be:
(a) One Year IEW = $50.00
(b) Two Year IEW = $65.00
(c) Three Year IEW= $80.00
(d) Dealers may xxxx up items (a) thru (c) above, not to exceed
twice the dealer cost.
X. Xxxx Central shall receive a marketing commission equal to $8.00 per
IEW sold. Dealers shall remit IEW funds payable to King Central.
King Central will remit Net IEW funds to Xxxx Harbor, less the King
Central $8.00 marketing commission. King Central shall be entitled
to the marketing commission set forth herein for as long as any King
Dealer continues to utilize the IEW Program irrespective of whether
this Agreement remains in force.
F. To assist King Central in its marketing and distribution efforts of
the IEW;
1. ACE USA shall provide King Central with
"Potential-Promise-Product-Profit" empty folder jackets to
insert King Central produced marketing materials.
2. QOMLINQ shall provide 3.5 Floppy Disks containing all applicable
IEW dealer documents for use by King Dealers who have enrolled
in the IEW Program. QOMLINQ shall deliver the disks in 100
quantities, as needed.
G. QOMLINQ acknowledges that the identity of King Dealers is
confidential and shall not disclose the names of any King Dealer to
any other party with the exception of Xxxx Harbor Insurance and ACE
USA.
X. Xxxx Central and QOMLINQ mutually acknowledge that the coverage,
rates and terms and conditions of the IEW may be modified by ACE USA
in their sole discretion.
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2. PURCHASE OF IEW TO COVER KING CENTRAL AND/OR THIRD PARTY OWNED ALARM
CONTRACTS:
A. IEW purchased to cover owned accounts shall be modified to provide
the following coverage.
(1) IEW covering owned accounts shall pay an hourly labor rate equal
to $65.00 per hour, subject to a $100 labor maximum per claim.
Parts shall be reimbursed at dealer cost plus 25%.
(2) IEW covering owned accounts may be purchased at a net rate of:
(i) One Year IEW = $42.00
(ii) Two Year IEW = $57.00
(ill) Three Year IEW = $72.00
B. QOMLINQ shall assist the purchaser in obtaining premium financing
from ACE USA or any other premium finance company or financial
institution providing terms and conditions acceptable to purchaser.
Negotiations with ACE Finance (Xxxxx Xxxxxx) will continue on
June 28, 2001.
C. QOMLINQ shall use its best efforts in negotiating a modification
and reduction to the 90 Day No Claim Period under the IEW, with
Xxxx Harbor Insurance and ACE USA. All parties acknowledge that
modification of coverage and rates is within the sole discretion
of ACE USA. In the event the modification is approved without an
increase in rates, the premiums shall be fully earned at
inception.
D. The specials terms and conditions in this Section 2 are not
applicable to IEW sold through King Dealers, IEW purchased or
sold through King Dealers shall be in accordance with all
standard published rates, rules and regulations pertaining to
the IEW Program. The special provisions and modifications in
this section shall only be applicable to warranties purchased by
King Central or third party entities in which it has an equity
interest, covering owned alarm contracts.
The above represents the full understanding of the parties and replaces any
prior oral or written understandings between the parties. Any disputes arising
under this Agreement shall be resolved by binding arbitration following the
procedures of the American Arbitration Association. This Agreement shall be
interpreted and have jurisdiction under the laws of the State of California.
QOMLINQ
0000 Xxxxxx Xxxxx Xxxxxxxxx, XX 00000
Acknowledged and Agreed to:
___________________________ QOMLINQ LLC:
BY:________________________ BY:_______________________
Title:_____________________ Title:____________________
Date:______________________ Date:_____________________
QOMLINQ
0000 Xxxxxx Xxxxx Xxxxxxxxx, XX 00000
