<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<FILENAME>k2001ex10.txt
<DESCRIPTION>EXHIBIT 10(K) WESCHESTER PREMIUM LETTER AGREEMENT
<TEXT>
                                   WESTCHESTER
                                     PREMIUM
                                   ACCEPTANCE
                                   CORPORATION
                               A Flatiron Company



June 1, 2001

Barry Goldstein
Payments, Inc.
2545 Hempstead Turnpike
East Meadows, NY 11554

RE: Modified Terms as discussed on Conference Call of June 1, 2001

Westchester Premium Acceptance Corp. (together with Input 1, LLC as "Servicer"),
seeks to provide a program  to  Payments,  Inc.  ("Seller")  and DCAP  Insurance
("DCAP") to provide premium financing for Seller and DCAP insured's. Capitalized
terms not defined herein shall have the meaning assigned to them in the existing
Sale Agreement by and between Seller and WPAC.

The parties agree to the following:

1.   First Right of Refusal by WPAC. WPAC shall have the first right of refusal,
     during the Term of the Agreement,  to purchase Eligible Premium Receivables
     originated, acquired or otherwise owned by Seller as follows:

     a)   Seller agrees that all Premium  Receivables  originated by Seller will
          be sold on an exclusive  basis to WPAC pursuant to the Sale Agreement,
          as modified herein (the "Modified Sales Agreement").

     b)   WPAC shall  terminate a  particular  agency  location of DCAP,  or any
          other  participating  insurance  agency,  immediately upon delivery of
          written  notice to Seller,  in the event such agency  fails to deliver
          Eligible  Premium  Receivables  in accordance  with the Modified Sales
          Agreement,  or whose  Premium  Receivables  generated  by such  agency
          exceeds the Loss Ratio Trigger.

2.   Minimum Down  Payment,  Days 1st Due and Maximum  Number of  Payments.  All
     Premium  Finance  Agreements  after May 1, 2001 to be  originated  with the
     following terms:





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                                          1st Payment Due
                                          date (from earliest    Maximum
                                          effective date of      Number
     Down Payment Requirement             Insurance Policy       of
     (as % of total premium)              being financed         Payments
     -----------------------              --------------         --------

15.0% or greater PLUS any earned fees     not more than          10 Payment
and taxes or amounts not covered by       30 days                maximum
insurance company return premium in
the event of a cancellation.

3.   Failure to Meet Down Payment Criteria. If Premium Receivables are delivered
     after May 1, 2001, which do not meet the down-payment requirement set forth
     above,  except for an  allowable  variance  not to exceed $5.00 per Premium
     Receivable,  then  Seller will be charged  the lesser of the  following  as
     liquidated  damages:

     a)   an amount equal to the difference between (1) such Premium Receivables
          Down  Payment  minimum  requirement  and (2) the actual  down  payment
          collected by for such Premium Receivable; and

     b)   the Purchase Premium.

4.   Seller   to  Make   Pre-Cancel   Calls.   All   Insured's   for   which  an
     intent-to-cancel  has been issued will receive a "pre-cancel"  call from or
     on behalf of the Seller.

5.   Servicing  Procedures  to be  Performed by  Servicer.  The  Servicer  shall
     perform each of the following procedures for each Premium Receivable Sold:

     a)   Each Premium Receivable,  for which a payment has not been received on
          or prior to the due  date,  will  trigger a same day  issuance  of the
          15-day intent-to- cancel notice.

     b)   Specific procedures  identified in Exhibit A herein to more accurately
          underwrite premium on Premium Finance Agreements and to reduce premium
          up-rate by the issuing insurance company shall be followed.

     c)   So long as  permitted by law and  regulation,  payment of the financed
          portion of the  policy  premium  for not less than 90% of all  Premium
          Receivables whose insurance  policies are being issued through the New
          York Automobile Insurance Plan ("NYAIP") shall be as follows:

          i.   The down  payment  plus a draft  sufficient  to equal  25% of the
               total premium of the insured shall be sent by or on behalf of


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               Seller to the respective  Issuing Insurance Company (or the party
               directed by the NYAIP) at time of policy binding:

          ii.  Not  earlier  than the date of receipt by  Servicer  of the first
               installment  due  on  the  respective  Premium  Receivable,   the
               remaining  premium  balance  shall be funded by the  Servicer  on
               behalf of Seller.

5.   Calculation  of  Purchase  Premium.  During  the  period  from May 1,  2001
     forward,  the Purchase Premium due Seller shall be the amount as calculated
     in  the  below  formula,  for  Eligible  Premium  Receivables  entered  the
     Servicer's system on and after May 1, 2001.

--------------------------------------------------------------------------------
                                         Purchase Premium Due in Month following
   Premium Receivable                    Premium Receivable origination and
      Description                        entry on Servicer system
---------------------------------        ---------------------------------------

Premium Receivables not
meeting Eligibility Criteria             None
--------------------------------------------------------------------------------
Eligible Premium Receivables
which the 1st scheduled payments
due is not made by the insured           None
--------------------------------------------------------------------------------
Eligible Premium Receivables             For contracts sold to WPAC in the
period from which the insured makes      May 1 to May 31, 2001:
the 1st scheduled payments due           $25.00 per Eligible Premium Receivable.

                                         For contracts sold to WPAC June 1, 2001
                                         and thereafter:
                                         $35.00 per Eligible Premium Receivable.
--------------------------------------------------------------------------------

     For the  payment of the  Purchase  Premium,  each May 1 and  November 1 the
     Static Pool  Cancellation  Rate shall be calculated by WPAC,  and the ratio
     for the Premium  Receivables  sold which a first  payment was made shall be
     used  for the  next  six (6)  months  as the  assumed  rate of  calculation
     performance  such that Seller shall use the assumed  first payment ratio to
     compute  amount of premium due it from WPAC and Seller shall be entitled to
     draft (on the  third or later  Business  Day of each  month)  the  Purchase
     Premium on the  Premium  Receivables  delivered  and boarded by WPAC in the
     immediately  prior month,  in accordance  with the Modified Sale Agreement.
     Each month WPAC and Seller  shall  "true-up"  the exact  amount of Purchase
     Premium due Seller and Seller or WPAC, as applicable, and shall immediately
     pay to the other the amount of any underpayment or overpayment generated by
     such month's Purchase Premium estimate as calculated above.

7.   Financing of Broker Fees. So long as allowed by the New York  Department of
     Insurance (or other  relevant  regulatory  body) the producing  agent shall
     have the right to finance as part of the Premium  Receivable,  up to $40 in
     Broker Fees on the submitted Premium



<PAGE>



     Receivables,  provided  however,  that any financed portion of a Broker Fee
     shall be paid to the producer only as the  scheduled  payments are received
     on the Premium Receivable. Any portion of the Broker Fee which is collected
     as part of such Premium Receivables down- payment, shall be retained by the
     originating broker.


     Example:   $40  Broker  Fee  charged  at  writing,   $5.00  collected  from
     down-payment and remaining $35 of a Broker Fee is financed over 10 payment,
     than as each schedules payment is received the producing agent will be paid
     $3.50 (i.e. $35/10).

8.   Term of Agreement: The term of the Modified Sale Agreement shall be through
     July 31, 2001 and thereafter  automatically  renew for an additional 30 day
     period unless one of the parties delivers prior written notice to the other
     stating that future sales shall  terminate as of the date described in such
     written  notice  (such date to be not less than  thirty  (30) days from the
     date of delivery of such notice).

Very truly yours,

WESTCHESTER PREMIUM
ACCEPTANCE CORPORATION

/s/ Bruce Lundy
Bruce Lundy
President

AGREED TO BY THE UNDERSIGNED

PAYMENTS, INC.                                       INPUT 1, LLC

/s/ Barry Goldstein                                  /s/ Todd B. Greenbaum
------------------------------------                 ---------------------------
By: Barry Goldstein                                  By: Todd B. Greenbaum
Title: Chairman and CEO                              Title: President and CEO






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                                    EXHIBIT A

            ORIGINATION AND SERVICING PROCEDURES TO REDUCE ADDITIONAL
                                PREMIUM UP-RATING


1.   For  accounts  where the premium is funded in full at the point of sale the
     following procedures will be performed:
     a.   On a daily  basis,  Input 1 will  receive a list of new  business  DEC
          sheets  from  insurance  carriers  for  policies  whose  premiums  are
          financed under the program.
     b.   For  up-rates  equal to or less than  $100.00,  Input 1 will prepare a
          letter  indicating  the up-rate  amount and  instructing  the agent to
          inform the insured  that the up-rate  must be paid in full.  The agent
          will make  arrangements  to either have the insured pay the up-rate to
          them or to the carrier directly. This letter will be faxed to both the
          producing DCAP office and to the corporate office of Payments, Inc.
     c.   For  up-rates  more  than  $100.00,  Input  1 will  prepare  a  letter
          indicating the up-rate amount and a premium finance  agreement for the
          financing of the up- rate, instructing the agent to inform the insured
          that  the  up-rate  can  either  be paid in  full or  financed  and if
          financed  that the insured must come to the  producing  DCAP office to
          sign the  additional  premium  finance  agreement and pay the required
          down payment for the up-rate.  This letter and finance  agreement will
          be faxed to both the producing DCAP office and to the corporate office
          of Payments, Inc.
2.   For accounts for policies placed through the New York Automobile  Insurance
     Plan  (NYAIP) and funded in two parts,  the  following  procedures  will be
     performed:
     a.   On a  daily  basis,  Input 1 will  receive  checks  paid to  insurance
          companies,  for the  balance of the premium due after the payment of a
          deposit  premium,  that have been rejected by the insurance  companies
          due to an up-rate.
     b.   For  up-rates  equal  to or less  than  $100.00,  Input 1 will add the
          up-rate to the loan balance,  and reissue  revised  payment coupons to
          the insured indicating the change in the premium.
     c.   For up-rates  greater than  $100.00,  Input 1 will prepare a letter to
          both the agent and the  insured  indicating  the  up-rate  amount  and
          instructing  the  insured  to go to the  producing  agent's  office to
          arrange for financing of the up-rate.
3.   For all new business DEC sheets  received,  regardless of funding method or
     carrier,  Input 1 will  write  down  payment  percentage  taken on the loan
     related to each DEC page and the name of the  producing  office  that wrote
     each policy which resulted in an up-rate.
4.   Input 1 will fax or email to Payments,  Inc.,  every DEC page with the down
     payment percentage and producing office indicated.
5.   Input 1 will  provide  Payments:  Inc.  a list of  up-rates  for  which  an
     additional premium finance contract was received and processed; these items
     shall be defined as "converted up-rates".
6.   Payments,  Inc. will create a chart of up-rate DEC pages received by office
     each day and converted up-rates each day, by producing office.



<PAGE>


7.   A ratio of  unconverted  up-rates to total  production  for each  producing
     office will be created by Payments, Inc.
8.   Once the unconverted  up-rate ratio for a producing  office reaches 7.5% or
     greater,  the producing office will be notified and put on watch status for
     potential  termination  as a sales  office  eligible to  originate  Premium
     Receivables under the Seller Agreement.




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