Sekurus OnTime: Firm Trying to Determine If it Can Remain Viable

Financial woes and a possible bankruptcy has resulted in at least hundreds of dealers using the Sekurus OnTime iLocate products wondering if the services they bought and paid for will continue to operate.

Sekurus OnTime, one of the oldest companies in the starter-interrupt industry, is in the midst of determining whether it can remain a viable ongoing concern.

George Golden, Sekurus OnTime CEO and chief financial officer, said Feb. 19, that the company was examining its legal options after accounting negotiations with PROCON, Inc., the Knoxville, Tenn.-based international provider of GPS location services, broke down. After payments for wholesale services were allegedly months past due, the PROCON decided to discontinue GPS location wholesale services for the iLocate product according to PROCON, Inc. officials.

Sekurus OnTime markets a proprietary code-based, starter-interrupt device used by buy here-pay here dealers and many subprime finance companies in getting timely payments from their customers. OnTime also marketed a product, iLocate, which offered its customers a GPS location system in addition to the starter-interrupt product. The iLocate product used wholesale services from PROCON, Inc.

Golden said while OnTime has between 1,200 and 1,500 dealers, the iLocate business “was only a small percentage of our overall business.”

“We have staff in place, and IT people who can provide the codes and support to our customers,” Golden said. “I’m here overseeing the operation on a continuing basis.”

Golden admitted that the company has laid off staff, is not actively engaged in new sales and is in deep discussions with its legal team to determine the future of the company.

“I won’t tell you business is good and life is wonderful,” he said. “We are investigating all of our legal options to determine the best course of action.”

Golden said his communication with PROCON Inc. has ended, and he was unaware if PROCON is planning to service OnTime’s iLocate customers.

David Meyer, executive vice president of PROCON, said his firm attempted to work out a solution with the past due balances with Sekurus OnTime “for several months” before taking the step of turning off its GPS services.

“After not receiving payment for services for months and months from OnTime, PROCON Inc. was left with no other option and discontinued providing these wholesale services to iLocate products.” Meyer said.

Golden said he repeatedly tried to negotiate with PROCON Continued from page 17

and requested clarification on invoices from the company. He

“vehemently” denies OnTime owed what PROCON claimed, and plans to vigorously defend his position and is working with his legal team to seek a remedy.

“There are many more facts to this situation that will come to light eventually,” Golden said. “We are working right now to gather and document all the facts necessary to protect our interests and against the claims made by PROCON.”

“It is a shame that Sekurus got itself into the position of not being able to pay for its wholesale services,” Meyer said. “However, it is our intention to help these dealers affected by this development and do our best to provide ongoing services for them.

“PROCON Inc. has put a program in place, which allows iLocate customers to purchase service at a discounted rate directly from PROCON for any GPS device purchased from iLocate.” Meyer said. “We understand this has a financial impact on the dealers and we want to alleviate that as a much as possible when it comes to the GPS services sold by Sekurus.”

From a dealer’s perspective it’s not always easy to understand who provides which services. In this case, Sekurus OnTime provides the proprietary code-based starter-interrupt device. PROCON Inc. wholesales the backend services for the Sekurus iLocate device to Serkurus OnTime, including the cellular airtime necessary for tracking the vehicles.

“We have contacted every dealer we could and are working out a solution on a case-by-case basis,” Meyer said.

Golden said from the Sekurus OnTime side, his firm is still supporting the OnTime devices and has a contingency plan to support all the devices in the field going forward.

“We want to reassure our customers that any existing units will continue to be serviced and there will be no fall off from that no matter what happens to the company,” Golden said. He would not detail how OnTime would do this if the company were to opt for bankruptcy or forced liquidation.

“Once again I’d encourage dealers to watch out who they do business with when it comes to this industry,” Meyer said. “Look at their partnerships, other industries they are involved in and ask for financials. All this is an important part in having a comfort level in who you are investing your money with to track your inventory.”

At least one subprime lender, Las Vegas-based Western Funding Inc., sent a notice to all its dealer partners that it would no longer fund deals “protected” by the Sekurus OnTime starter-interrupt and iLocate systems.

“We’ll not put any more money on the street for vehicles with those devices,” said Western Funding President Dwight Cope. “I just don’t have a comfortable feeling. It took a long time for me to feel comfortable using the systems in the first place. In fact, it took years. Until that comfort level returns with this company, we’ll not fund any of those deals.”