Option #1:
The creator of the formmail script (Matt) offers to run the script from their website for a monthly fee. Click here for info on this option. Allwebco does not support and has not tested this option. All support would be provided by http://www.formmail.com.
Option #2:
Another way to proceed, if you do not have Allwebco hosting, is to get a sample contact form from your hosting company, get the sample form working with your hosting companies instructions or support. Once the form is working, the code can be added to the template "contact.htm".
Option #3:
Remove the form area on the contact page between the "START FORM" and "END FORM" notes and just use an e-mail link on your contact page.