RECITALS
WHEREAS, the Company engages in the business of developing, marketing, administering, and supporting various vehicle service contracts and related offerings (“Program”), which include the Company’s vehicle service contracts (“Contracts” and, as used in this Agreement, “Contracts” expressly includes all other offerings under the Program); and
WHEREAS the Dealer desires to fulfill the obligations herein and follow the requirements of the Program.
NOW THEREFORE, in consideration of the promises, mutual covenants, and other good and valuable considerations, the Company and the Dealer hereby agree as follows:
Dealer Responsibilities
The Dealer agrees to:
1. Contract Sales
a. The Dealer agrees to offer Contracts exclusively on forms prescribed by the Company and furnished to the Dealer. Each Contract shall be sold only for eligible vehicles and in accordance with the Program coverages, rules, regulations, terms, and pricing in effect at the time of sale. All Contracts must be sold within fourteen (14) days of the vehicle’s purchase date. Before selling a Contract, the Dealer agrees to conduct a thorough inspection of the vehicle in compliance with Program guidelines, address any identified deficiencies, and certify that the vehicle is in good working mechanical condition.
b. The Dealer shall promptly conform to any revisions to the Program, including but not limited to changes in coverage, rules, regulations, terms, and pricing as directed by the Company. The Dealer further agrees not to alter, modify, waive, or discharge any term or condition of the Program or any approved Contract. The Dealer shall avoid making representations about coverage or terms that are not explicitly stated in the Contract.
c. Any misrepresentation of coverage or terms in a Contract may result in the Dealer being solely responsible for the payment of claims, including but not limited to repair costs, legal fees, and judgments arising from such claims. The Company shall have no liability for Contracts sold on unauthorized, outdated, or discontinued forms, and the Dealer shall indemnify, defend, and hold harmless the Company from any claims, liabilities, or costs resulting from such actions.
d. The Dealer acknowledges that the use of unauthorized or outdated forms, failure to comply with Program revisions, or misrepresentation of Contract terms is a material breach of this Agreement and may subject the Dealer to additional liabilities as determined by the Company or applicable law.
2. Funds Remittance
a. The Dealer agrees to remit all funds due to the Company, including but not limited to funds relating to each Contract or other Company offerings sold by the Dealer, within ten (10) days following the end of the month in which the sale occurred or as required by applicable law, whichever is sooner. Any additional monies owed by the Dealer to the Company shall be due immediately upon the Dealer’s receipt of billing. The Dealer further agrees to remit the Company’s charged costs for each Contract sold, as specified in the current rate cards or as otherwise communicated to the Dealer.
b. The Company reserves the right to periodically adjust its charged costs at its sole discretion, with any adjustments taking effect thirty (30) days after notice is provided to the Dealer by reasonable means. The Company may also, without waiting periods, impose immediate adjustments or surcharges on amounts due from the Dealer for reasons such as high losses, vehicle-specific surcharges, or other related factors, which will be communicated to the Dealer.
c. Failure to remit funds within the specified time frame may result in the Dealer being held liable for all claims, including repair costs, legal fees, and judgments. Additionally, the Dealer acknowledges that failure to remit funds as required constitutes a material breach of this Agreement. The Dealer agrees to be responsible for any taxes imposed by law as a result of the sale of any part of the Program and will provide the Company with necessary information to secure any applicable exemptions from such taxes.
d. In the event any fees or other amounts due to the Company remain unpaid after thirty (30) days, the Company reserves the right to deduct these amounts from any fees or other sums owed to the Dealer under this or any other agreements. The Company may also offset amounts due to the Dealer against any amounts the Dealer owes under this Agreement or any other agreements with the Company, its subsidiaries, affiliates, or dealer groups.
e. The Dealer agrees to ensure timely remittance of funds to avoid liabilities, including but not limited to the costs of repairs, legal fees, judgments, and other expenses incurred by the Company due to the Dealer’s failure to meet its remittance obligations.
3. Cancellations and Refunds
a. The Dealer agrees to promptly refund all money due to the Purchaser upon the cancellation of a Contract, including any portion of the amount paid by the Purchaser that may have been retained by the Dealer. Refund calculations, payment provisions, and any cancellation fees due from the Purchaser are determined in accordance with the terms stated in the Contract signed by the Purchaser. The Dealer further agrees to pay the required cancellation fee to the Company as specified in the Contract.
b. The Company reserves the right to cancel any Contract at its sole discretion, subject to the terms of the Contract and applicable state law. The Company may also decline or refuse to accept any Contract at its sole discretion, subject to the same conditions. In such cases, the Dealer agrees to promptly correct any errors that caused the declination or refusal and resubmit the Contract to the Company for reconsideration. If the Contract cannot be corrected to meet the Company's requirements, the Dealer shall refund any money tendered by the Purchaser in relation to the declined or refused Contract.
c. The Dealer acknowledges that any failure to comply with these obligations, including the refund of monies due or the payment of required cancellation fees, may result in liability for all associated costs, including legal fees, claims, or judgments, as determined under the terms of this Agreement.
4. Repair Services
a. If the Dealer engages in repair services under a Contract, the Dealer agrees to provide repairs or replacements for vehicles covered by a previously approved claim in accordance with the terms of the Contract. The Dealer must charge rates for parts and labor that do not exceed the amounts stipulated in the Contract.
b. The Dealer agrees to obtain prior approval from the Company for all repairs or replacements under a Contract. Claims for reimbursement must be submitted to the Company within thirty (30) days after repair completion. No claims will be reimbursed for amounts exceeding the prior approval provided by the Company. Additionally, all claims, even those preapproved, must be submitted within 90 days of repair completion to remain eligible for reimbursement.
c. The Dealer further agrees not to submit claims for reimbursement for any of the following:
i. Components or parts not covered by an approved Contract.
ii. Repairs or replacements expressly excluded or not covered under the Contract.
iii. Costs resulting from the Dealer’s failure to perform repairs in a good and workmanlike manner.
iv. Repairs or replacements to correct conditions pre-existing at the time the vehicle was sold.
v. Repairs for items covered by a manufacturer’s warranty, the Dealer’s or repairer’s guarantee, or another service contract or agreement other than
the Company’s Contract.
vi. Recommendations for replacement parts or components that have not experienced a mechanical breakdown as defined in the Contract.
d. Failure to adhere to these provisions may result in claims being denied and potential liability for associated costs, including but not limited to legal fees, judgments, or unrecovered repair expenses.
5. Guarantee of Service
a. If the Dealer performs repair services under a Contract, the Dealer agrees to provide a minimum nationwide unconditional guarantee for parts and labor against defects in materials and workmanship. This guarantee applies under normal use and remains in effect for a period of 12 months or 12,000 miles from the date of service, whichever comes first.
b. The Dealer is responsible for ensuring this guarantee is honored nationwide and reflects the standards of quality required under the terms of the Contract. Failure to provide this guarantee may result in liability for costs associated with defects, including repairs, customer claims, and legal fees.
6. Customer Support & Program Awareness
a. The Dealer agrees to assist customers with inquiries, claims filing, and all matters related to Contracts, ensuring a seamless customer experience. The Dealer shall accurately and fully inform prospective purchasers about the terms, coverage, exclusions, conditions, and other provisions of the Contracts or offerings.
b. All Contracts and offerings must be solicited and issued in strict compliance with the policies, procedures, risk management, and marketing guidelines established by the Company and its contractual liability insurer. The Dealer's adherence to these standards ensures transparency, customer satisfaction, and alignment with the Program's regulatory and operational requirements.
7. Fiduciary Responsibility
a. The Dealer agrees to hold all funds or materials of value received or collected under this Agreement in a fiduciary capacity as the property of the Company. These funds shall be kept separate and not intermingled with personal or other funds, nor shall they be used for personal or any other purpose. This obligation ensures the integrity of the Program's financial transactions and safeguards the Company's assets against misuse or mismanagement.
8. Marketing & Compliance
a. The Dealer agrees to use reasonable efforts to market the Program while faithfully performing all duties in strict compliance with applicable laws, rules, regulations, and the instructions provided by the Company. The Dealer shall also be responsible for all business expenses and taxes incurred in connection with marketing and administering the Program. This includes adhering to all Company guidelines to ensure lawful and effective promotion of the Program.
9. Confidentiality
a. The Dealer agrees to maintain the confidentiality of the Company's Confidential Information and to use such information solely for the purposes of fulfilling obligations under the Program. "Confidential Information" includes, but is not limited to, proprietary and sensitive details about the Company's business and affairs, policies, procedures, techniques, processes, equipment, software programs, financial information, rate structures, pricing policies, contractual relationships, forecasts, sales strategies, marketing plans, and any information regarding third parties provided by the Company.
b. Confidential Information excludes information that was publicly available at the time of disclosure or already known to the Dealer through legitimate means prior to disclosure by the Company. The Dealer agrees not to disclose, disseminate, publish, transfer, or otherwise make available any Confidential Information to third parties. The Dealer also commits to safeguarding the Confidential Information with at least the same degree of care as it uses to protect its own confidential and proprietary information. Any breach of this confidentiality obligation shall be considered a material breach of this Agreement.
10. Indemnification & Liability
a. The Dealer agrees to indemnify and hold the Company, including its agents, employees, successors, and assigns, harmless from any and all claims, actions, demands, liabilities, and expenses (including but not limited to attorney’s fees and other legal costs) arising from the Dealer's actions or failure to act. This includes, but is not limited to:
i. Any harm or damage to persons or property caused by the Dealer, its agents, or employees,
ii. Any act related to the Dealer's business operations that are beyond the control of the Company,
iii. Any claims arising out of or related to a Contract, except where such claims are directly caused by the Company’s failure to meet its obligations,
iv. The Dealer's failure to comply with applicable laws, rules, regulations, and ordinances in the sale of Contracts.
b. This indemnification obligation shall remain in effect even if the Dealer's actions or failure to act causes damages or liabilities. The Dealer’s obligation to indemnify and hold harmless the Company applies irrespective of whether the Company meets its own obligations under the Agreement.
11. Contract Modifications
a. The Dealer agrees to offer Contracts to customers (“Purchasers”) on forms prescribed by the Company. Each Contract must be sold only for an eligible vehicle and in accordance with the Program's current coverages, rules, regulations, terms, and pricing in effect at the time of sale. The Dealer must sell the Contract within fourteen (14) days of the vehicle purchase date. Prior to selling the Contract, the Dealer must inspect the vehicle in compliance with Program guidelines, remedy any deficiencies, and certify that the vehicle is in good working mechanical condition. The Company will provide an inspection sheet for each vehicle to be included with the filing of the Contract from the Dealer or the Company.
b. The Company reserves the right to modify or revise the Program at any time, including but not limited to changes in coverage, rules, regulations, terms, and pricing. The Dealer agrees to promptly conform to any such revisions and acknowledges that failure to do so will result in the Dealer’s liability for any non-compliant Contracts.
c. The Company further reserves the right to cancel or refuse any Contract, at its discretion. If the Company refuses or cancels a Contract, the Dealer is required to correct any errors or discrepancies and, if necessary, refund the money to the Purchaser.
d. The Dealer agrees that it has no authority to alter, modify, waive, or discharge any term or condition of the Program, including any approved Contract. The Dealer shall not make representations about coverage not explicitly stated in the Contract. Any misrepresentation regarding coverage will hold the Dealer responsible for the payment of all claims, including but not limited to repair costs, legal fees, and judgments resulting from such claims.
e. The Company shall not be liable for any Contracts offered by the Dealer that are (i) not on the prescribed form, (ii) discontinued by the Company, or (iii) issued in violation of this Agreement. The Dealer agrees to indemnify, defend, and hold the Company harmless in such cases.
12. Debt Offsetting
a. The Dealer agrees that any fees or amounts owed to the Company, or its agents or assigns, which remain unpaid for more than thirty (30) days, may be deducted from any fees or other amounts otherwise due to the Dealer under this Agreement. The Company reserves the right to offset any amounts due to the Dealer under this or any other agreement the Dealer may have with the Company, or any of its subsidiaries, affiliates, or dealer groups, against any amounts owed by the Dealer to the Company. This includes any unpaid fees, amounts, or liabilities, and the Company may exercise this right at its discretion.
13. Responsibility for Business Costs
a. The Dealer agrees to bear all of its own business and marketing expenses, including but not limited to costs related to advertising, promotion, and operational activities. The Dealer shall not incur any expense or cost on behalf of the Company or seek reimbursement from the Company for such expenses. The Dealer is solely responsible for managing and financing its business operations, and the Company shall have no liability or obligation for any costs or expenses incurred by the Dealer in connection with its business activities.
Company Responsibilities
The Company agrees to:
14. Program Support
a. The Dealer shall be responsible for providing all necessary forms and materials required for the implementation of the Program. These materials shall remain the property of the Company, and the Dealer agrees to use them solely for the purposes of administering the Program as outlined in this Agreement.
b. The Dealer further agrees to maintain and administer the Program in accordance with this Agreement, ensuring that all Contracts are serviced appropriately and that all claims are paid in full. The Dealer is obligated to remit to the Company all funds due under this Agreement, including but not limited to funds relating to each Contract sold, within ten (10) days following the end of the month in which the Contract or other Company offering was sold, or as required by applicable law, whichever comes first. Any additional amounts owed by the Dealer shall be due immediately upon receipt of a billing from the Company. Failure to remit such funds within the specified timeframe may result in the Dealer assuming responsibility for the payment of any and all claims, including, but not limited to, the cost of repairs, legal fees, costs, and judgments.
c. If the Dealer engages in repair services in connection with a Contract, the Dealer must notify the Company in advance and obtain prior approval before proceeding with any repairs or replacements under any Contracts.
15. Insurance Arrangement
a. The Dealer shall arrange and maintain insurance coverage sufficient to meet the Company’s obligations under the Program. This insurance coverage must address all potential liabilities arising from the sale and administration of the Contracts under this Agreement, ensuring that the Company's interests are fully protected.
b. In the event of contract cancellations, the Dealer is obligated to promptly refund to the Purchaser any and all money due. This includes, but is not limited to, the refund of any portion of the amount the customer paid for the Contract that may have been retained by the Dealer. The cancellation calculation method, payment provisions, and any applicable cancellation fees due from the customer are specified in the Contract signed by the Purchaser. Furthermore, for canceled and terminated contracts, the Dealer agrees to pay the Company any cancellation fee as outlined in the Contracts.
16. Dealer Payment
a. The Dealer shall compute payments for covered claims in accordance with the customary retail labor rate as outlined in the Contract terms, including reimbursement for towing and rental vehicle charges where specified. In connection with a Contract, if the Dealer provides repair services, it will ensure that repairs or replacements on vehicles covered by the Contracts are performed pursuant to a covered claim that has been pre-approved by the Company. The Dealer agrees to charge for parts and labor at rates that do not exceed the terms set forth in the Contract.
b. The Dealer further agrees to submit all covered claims for reimbursement to the Company within thirty (30) days after the completion of repairs or replacement. Claims will only be submitted for the amount that was previously authorized by the Company. Any claim that has not been preapproved by the Company will not be eligible for reimbursement. In addition, even with prior approval, all repairs and replacements must be submitted within 90 days of completion, or they may be ineligible for reimbursement.
c. The Dealer agrees not to submit claims for reimbursement for any repairs, replacements, or other expenses that fall under the following conditions:
(i) components or parts not covered by an approved Contract;
(ii) items expressly excluded or not covered by the Contract;
(iii) repairs resulting from the Dealer’s failure to perform in a good and workmanlike manner;
(iv) parts or components intended to correct conditions that existed at the time the vehicle was sold;
(v) repairs covered by a manufacturer’s warranty, the Dealer’s or repairer’s guarantee, or any vehicle service contract other than the Company’s Contract; or
(vi) parts or components that the Dealer’s service department recommends replacing but which have not experienced a mechanical breakdown as defined in the Contract.
d. Additionally, the Dealer shall provide a minimum nationwide unconditional guarantee for parts and labor against defects in materials and workmanship under normal use, for a period of 12 months or 12,000 miles after the date of service, whichever occurs first.
17. Hold Harmless Clause
a. The Company agrees to hold the Dealer harmless from any liabilities, claims, or actions arising from the Company's acts or omissions. This includes any actions, omissions, or failures by the Company in the performance of its obligations or in the provision of the Program.
b. The Dealer, in turn, agrees to accurately and fully advise every prospective purchaser of a Contract or other offering regarding the terms, coverage, exclusions, conditions, and other provisions of the Contract or offering. Furthermore, the Dealer agrees to solicit and issue Contracts in accordance with the policies, procedures, risk management, and marketing guidelines set forth by the contractual liability insurer of the Company. This ensures that all sales and actions performed by the Dealer comply with the Company’s standards and legal requirements.
18. Policy Communication
a. The Company agrees to inform the Dealer of all relevant policies, procedures, and guidelines provided by the Company’s insurer. The Dealer is responsible for adhering to these guidelines and understanding the costs associated with each Contract sold.
b. The Dealer agrees to remit to the Company all charged costs for each Contract sold, as reflected in the current rate cards or as otherwise communicated to the Dealer. These costs may be periodically adjusted by the Company at its sole discretion, with any such adjustments taking effect thirty (30) days after notice is communicated to the Dealer by any reasonable means. If the Dealer fails to properly remit funds to the Company within the prescribed time frame, the Dealer will be liable for all costs and expenses incurred by the Company as a result of this failure.
c. Furthermore, the Company reserves the right to immediately adjust the amount required from the Dealer, including due to high losses, vehicle surcharges, or other similar reasons, with such adjustments communicated to the Dealer. Failure by the Dealer to remit the required funds for any Contract issued shall constitute a material breach of this Agreement.
Termination and Post-Termination Obligations
19. Termination Notice
a. Either the Dealer or the Company may terminate this Agreement for any reason upon providing thirty (30) days’ notice. Such notice of termination from the Company may be communicated by an agent of the Company. In the event of fraud or a material breach of the Agreement by either party, its agents, or employees, either party may cancel this Agreement immediately. Termination for fraud or material breach shall be effective upon service of notice to the address set forth in the first paragraph of this Agreement.
20. Automatic Termination
a. This Agreement shall terminate automatically, without notice from the Company, in the event that a petition of bankruptcy is filed by or against the Dealer, or if the Dealer makes an assignment for the benefit of creditors, is voluntarily adjudicated as bankrupt by a court of competent jurisdiction, or files a petition for reorganization or an arrangement with creditors. The Agreement will also automatically terminate if a receiver is appointed for all or a substantial part of the Dealer’s business, if any attachment, levy, or execution occurs, or if at any time the Dealer fails to remit to the Company the full amount due in connection with the issuance of a Contract.
21. Post-Termination Obligations
a. Upon termination or cancellation of this Agreement, the Dealer must immediately and permanently cease using the Company’s portal, including passwords, and disassociate from the Company. The Dealer shall also stop advertising or using the Company’s name, logos, methods, software, programs, templates, contract forms, and other materials. The Dealer is required to take all necessary steps to disassociate from the Company, including the removal of all signs, signage, boards, equipment, letterheads, and any references on Internet sites, web pages, or social media. The Dealer must also notify all agents, brokers, suppliers, vendors, creditors, and other relevant parties that the Dealer is no longer affiliated with the Company. Furthermore, the Dealer must return all printed materials and supplies to the Company at its own expense.
b. Termination or cancellation of this Agreement shall not affect the Company’s responsibility for covered claims under Contracts for which the Company has received payment prior to the effective date of termination or cancellation. The Dealer’s obligations under active Contracts remain in force, and the Dealer’s obligations under Section 1 of this Agreement survive the termination or cancellation. Upon termination, the Dealer is no longer eligible for any promotions, giveaways, incentives, or similar programs, and any partial or full completion of such programs is extinguished.
Miscellaneous
22. Entire Agreement
a. This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements, arrangements, or understandings, whether written or oral, between the parties. Any future modifications or amendments to this Agreement must be made in writing and signed by both parties to be valid and enforceable.
23. Jurisdiction
a. This Agreement shall be governed by and construed in accordance with the laws of the State of Utah, without regard to its conflict of laws principles. Any legal action or proceeding related to this Agreement or its enforcement shall be exclusively brought in the state or federal courts located in Salt Lake County, Utah. Both the Company and the Dealer expressly and irrevocably consent to the jurisdiction of such courts and agree to submit to the jurisdiction of the state and federal courts located in Salt Lake County, Utah, including any appellate courts in the State of Utah, for any legal proceedings arising from this Agreement.
24. Severability
a. If any provision of this Agreement is deemed invalid under the law or regulations of any state where applicable, such provision shall be deemed not to be part of this Agreement. However, this will not invalidate any other provision of this Agreement, which shall remain in full force and effect.
b. With the exception of notices under Section 1.2, all other notices, demands, or terminations related to this Agreement must be in writing, signed by the party serving the notice. Such notices should be deposited, postage prepaid, in the United States Postal Service as certified or registered mail. Notices shall be sent to the following addresses:
i. If to the Dealer: The Dealer’s physical address as set forth in this Agreement.
ii. If to the Company: CPO Extended Warranty, LLC, P.O. Box 84, Orem, UT 874059.
25. Records Access
a. The Company shall have full and free access during business hours to the Dealer’s office or place where records are kept, in order to inspect books, records, and files related to the business covered by this Agreement and the Program. The Dealer agrees to make such records available for inspection by the Company as needed to ensure compliance with the terms of this Agreement.
26. Independent Contractor
a. The relationship between the parties is that of independent contractors, and nothing in this Agreement shall be construed to create a partnership, joint venture, or employer-employee relationship. The Dealer is not an agent of the Company, and this Agreement does not grant either party the authority to act on behalf of the other, except as expressly provided herein.
b. This Agreement shall be binding upon and inure to the benefit of the permitted successors, legal representatives, and assigns of the parties. The rights and obligations of the Dealer under this Agreement may not be assigned without the prior written consent of the Company. However, the Company may assign this Agreement without the Dealer’s consent.
c. No waiver or failure by either party to enforce or insist upon compliance with any of the terms of this Agreement shall be construed as a waiver of said terms, nor shall it be considered a waiver of any other terms. Any waiver of a right or remedy under this Agreement must be in writing and will not be construed as a waiver of future rights or remedies.
This document serves as the comprehensive terms governing the relationship between the Dealer and the Company, ensuring mutual understanding and adherence to defined responsibilities.