Definitions to Commonly  Used Terminology

Administrator means CarGuard Administration, INC, a Corporation organized under the laws of the State of Kansas, whose principal place of business is 4901 W. 136th Street, Leawood, KS 66224, which is the entity that is obligated to perform hereunder.

Authorized Repair Facility means any dealership, local mechanic repair facility, or other vehicle repair facility that is certified to perform mechanical repairs on motor vehicles from the National Institute for Automotive Service Excellence (ASE) located in the United States or Canada.

Breakdown and/or Mechanical Failure means the failure of an original or replacement part covered by this Agreement to perform its function as it was originally designed to work in normal service with required maintenance due to material failures, mechanical failures, or defects outside the manufacturer’s tolerance.

Commercial Use means vehicles used for farming, ranching, route work, job-site activities, service or repair work, and delivery of goods. Usage must not exceed the manufacturer’s ratings and/or limitations. In order for commercial use vehicles to be covered under this contract, the Commercial Use surcharge box must be checked on the original Application Page. If this is not checked, it is your responsibility to contact us to add the surcharge.

Coverage means the component protection You selected as shown in this Contract and on your Identification Card.

Covered Part(s) or Covered Repairs means the parts listed under “Section IV. Coverage” of this Contract and any parts listed on section “VII. Add On Coverage Options” of this Contract if those “add ons” are selected on the Application Page of this Contract.

Deductible means the amount of money You are required to pay as selected on the Application Page for covered Breakdown claims. The deductible will be due and owing each visit to a repair facility for covered Breakdown claims. Once a Covered part is repaired or replaced under the terms of this Contract, there will be no Deductible for future repairs to that part.

Dealership means the original venue where Your car was purchased.

Effective Date and Mileage means the date You purchased Your Contract and the odometer mileage on Your vehicle at the time You purchased this Contract. This is indicated as the Effective Date and Contract Expiration Mileage on the Application Page of this Contract.

Expiration Date and Mileage means the date and/or mileage when Your Contract is no longer in force. Your Contract Expires once the Contract Expiration Date or Contract Expiration Miles are reached as defined on the Application Page of this Contract. Once either of these two conditions are met, this Contract shall no longer be in force.

Finance Agent or Payment Plan Provider means the company that is providing the payment plan or financing for this Contract. The Finance Agent or Payment Plan Provider places a lien against any refunds due on this contract until they have been repaid by You in full.

Identification Card means the card that was sent to you, which becomes part of this Contract. It gives information about You, Your Vehicle, Coverage chosen and other significant information, including your Contract Number.

Contract Number is the number We use to identify this Contract on Your Vehicle.

Pre-Existing Condition means a condition, breakdown, or mechanical issue that within all probability occurred before Your purchase of this Service Contract.

Selling Agent, or Seller means the company that sold this Contract to You. The identity of the selling agent is listed on the Application Page.

Vehicle means the Vehicle which is listed on the Application Page.

Waiting Period means the period of time and mileage that must transpire before a claim may be filed hereunder. Unless otherwise indicated on the Application Page of this Contract, the waiting period is equal to thirty days of the Effective Date and one- thousand (1,000) miles from the Effective Mileage of this Contract. If a different Waiting Period is indicated on the Application Page of this Contract, then the period of time and mileage as indicated on the Application Page of this contract must transpire from the Effective Date and Effective Mileage of this Service Contract before a claim may be filed. The waiting period time and mileage shall be added to the end of the contract term.

Wear and Tear means the gradual reduction of performance of a part beyond the manufacturer’s specified tolerances that occur naturally under normal operating conditions, which ultimately results in the failure of that part.

ADMINISTRATOR: Matrix Warranty Solutions, Inc. 3100 McKinnon Street, Suite 420, Dallas, TX 75201. 1-833-228-1900.

BUSINESS USE: Vehicles used primarily for profit, such as repair work, route work, service work, and delivery. Vehicles used for farm work or oil field work are included under this definition and are eligible for coverage if their primary use is transportation and not off-road work. Other examples include, but are not limited to floral delivery, cable TV repair, plumbing, vending machine services, catering, medical supply delivery, home repairs, and realty services.

AUTHORIZATION MUST BE OBTAINED FROM THE ADMINISTRATOR BEFORE STARTING ANY TEARDOWN OR REPAIRS.

PLEASE CALL 1-833-228-1900 FOR AUTHORIZATION AND INSTRUCTIONS.

COST: The customary and reasonable charges for the parts and labor necessary to repair or replace Covered Components or Covered Tires. Cost will not exceed either the manufacturer’s suggested retail (list) price for parts or the labor allowances derived from industry-recognized flat-rate manuals. The labor rate must be authorized by the Vehicle manufacturer for franchised dealers and cannot exceed the average retail rate charged by similar repair facilities in the same area. All charges are subject to the limits of liability, the terms and conditions of this Service Contract, and the Administrator’s approval.

COVERED BREAKDOWN or COVERED MECHANICAL BREAKDOWN: A Breakdown that is covered by this Contract.

COVERED PART(S) and COVERED COMPONENT(S): Any part of the Vehicle listed herein as a Covered Part/Component and not excluded from coverage by this Service Contract.

COVERED REPAIR: A repair to a Covered Part/Component that is authorized by the Administrator.

COVERED TIRE: A tire that conforms to Vehicle manufacturer’s specifications and was D.O.T. approved at the time of sale, or any equivalent replacement tire on the Vehicle when it was delivered.

COVERED TIRE REPAIR: A repair to a Covered Tire that is authorized by the Administrator.

EMERGENCY REPAIRS: Repairs made outside of Administrator’s business hours, which, if not performed, would impair the future operation of Your Vehicle, or render Your Vehicle inoperable or unsafe to drive.

FINANCE COMPANY: Any financial institution providing financing for the purchase of this Service Contract.

LICENSED REPAIR FACILITY: Any automotive repair facility that has been licensed to perform automotive repairs by the state in which it operates.

LUBRICATED PART: A part that requires lubrication to function correctly.

MECHANICAL BREAKDOWN, BREAKDOWN, FAILURE, FAILS, or FAILED: The inability of any Covered Component(s) that has received proper maintenance, as prescribed by this Service Contract, to function in the manner for which it was designed. This inability must be the result of defective material or faulty workmanship, not due to the gradual reduction in component performance through normal or excessive usage. In addition, a Failed part must be outside the allowable tolerances prescribed by the manufacturer to be deemed a Failure. This is distinguished from Tire Failure, as defined in this section.

ROAD HAZARD: Potholes or debris on the surface of a road (such as nails, glass, rocks, or tree limbs) which may cause damage to your Covered Tire.

SELLING COMPANY: The entity identified on the first page of this Contract from whom You purchased this Service Contract.

SERVICE CONTRACT or CONTRACT: This document in its entirety, which explains the coverage and limitations afforded to You.

TIRE FAILURE or FAILED TIRE(S): The inability of any tire to function in the manner for which it was designed, either due to contact with a Road Hazard, a defect in materials, or faulty workmanship. This inability to function is not due to misuse or abuse, and specifically excludes normal and excessive wear and tear.

VEHICLE: The Vehicle identified on the first page of this Contract.

ADMINISTRATOR: refers to Royal Administration Services, Inc. Administrator is responsible for administering this Service Contract. All inquiries should be directed to the Administrator. Toll-free assistance is available at 1-800-871-0467.

BREAKDOWN, MECHANICAL BREAKDOWN, MECHANICAL FAILURE: Refers to a failure due to defects in materials and/or workmanship of a Covered Part to perform the function for which it was designed by its manufacturer. A Breakdown does not include sludging or gelling conditions. Further, a Breakdown does not include any failures to Your Vehicle if the manufacturer has announced its responsibility through any means including public recalls and factory service bulletins or TSBs.

COVERED PART or COVERED PARTS: Refers to the parts or components listed under the section entitled “Plan Coverage.”

DEDUCTIBLE: The minimum portion of the covered repair which You will have to pay if You have a claim. The amount of Your Deductible is shown on Your Registration Page. This amount is applied per claim, and to each claim.

EXPIRATION TYPE: This Service Contract is subject to a Plan Period and Expiration Type. The Plan Period is the number of months and number of miles for which You are afforded coverage under this Service Contract. The Expiration Type determines when the number of miles is reached. Please refer to the section entitled “Expiration Type” on Your Registration Page for more information.

FULL FACTORY WARRANTY, FACTORY WARRANTY: Refers to the full Manufacturer’s Warranty provided to You at no additional cost, and covers repairs to Your Vehicle to correct any defect in material or workmanship. This Service Contract is not a Factory Warranty.

LABOR: Total labor time for a covered repair will be determined by a current nationally published labor manual. The labor rate for authorized repairs will be based on the posted labor rate of the licensed repair facility that You selected. If the repair facility’s labor rate is not posted the Administrator reserves the right to approve a labor rate based on the average labor rate for similar local repair facilities. Administrator also reserves the right to adjust the approved labor rate if the repair facility’s labor rate is deemed to be excessive by the Administrator when compared to local average labor rates for similar facilities.

OEM: Original Equipment Manufacturer.

PLAN PERIOD: This Service Contract is subject to a Plan Period and Expiration Type. The Plan Period is the number of months and number of miles for which You are afforded coverage under this Service Contract. The Expiration Type determines when the number of miles is reached. Please refer to the section entitled “Expiration Type” on Your Registration Page for more information.

SERVICE CONTRACT: This Service Contract is issued to You and covers Your vehicle described on the Registration Page of this Service Contract.

SERVICE CONTRACT NUMBER: Please see the box labeled “Service Contract Number” on the Registration Page. Please refer to this number in any written or verbal communication, such as requesting information or filing a claim.

VEHICLE, YOUR VEHICLE: Refers to the vehicle described on the Registration Page of Your Service Contract and owned by You.

VENDOR: Refers to the party who sold You this Service Contract. Please see the box labeled “Vendor Name” on the Registration Page for Your Vendor’s contact information.