Exhibit 10.19
APRIVA AMENDMENT TO SERVICE AGREEMENT
     This APRIVA Amendment to Service Agreement (this “Amendment”) is made and
entered into as of this 18th day of October, 2007 between First Data Merchant
Services Corporation (“FDMS”) and iPayment, Inc. (“Customer”).
RECITALS
     A. Customer and FDMS have previously entered into a Service Agreement dated
as of December 24, 2004, as previously amended (the “Service Agreement”).
     B. Customer and FDMS now desire to amend the Service Agreement as set forth
herein.
AGREEMENT
     In consideration of the foregoing, Customer and FDMS hereby agree as
follows:
     1. The terms of this Amendment will be effective as of September 1, 2007,
notwithstanding the date of execution.
     2. Exhibit “A” to the Service Agreement is hereby amended by the addition
of the following paragraph:

  “H.   APRIVA Services. Through an agreement with APPSware Wireless L.L.C., dba
APRIVA (“APRIVA”), FDMS will make available to Customer the APRIVA Wireless
Point-of-Sale System that provides an integrated hardware, software and network
platform to process financial transactions and includes gateway services that
enable the transport and reporting of certain data relating to point-of-sale
transactions (the “APRIVA Services”). Customer acknowledges and agrees that the
APRIVA Services will only work in conjunction with certain third party wireless
carrier networks, point-of-sale terminals, mobile or cellular phones, PDAs or
similar devices and accessories that have been certified for use with the APRIVA
Services. Customer acknowledges and agrees that its use of the APRIVA Services
is subject to the terms, conditions and restrictions set forth in this
Paragraph, as follows:

  (a)   FDMS or APRIVA may, at any time in its sole discretion, modify, replace
or add to the APRIVA Services, including revisions to any related documentation,
terms and conditions and licenses and changes in the wireless carrier networks,
supported platforms and wireless point-of-sale terminals and accessories used,
certified for use with, or used to deliver the APRIVA Services.     (b)   FDMS
and APRIVA reserve the right to schedule, from time to time, interruptions of
the APRIVA Services for maintenance activities. Availability of the APRIVA
Services may vary due to events beyond the control of APRIVA or FDMS including
routine maintenance and outages by third party vendors.

 

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  (c)   Customer will pay the fees for the APRIVA Services set forth in
Exhibit B. If new features or functionality are added to the APRIVA Services,
FDMS may adjust the fees set forth in Exhibit B upon written notice to Customer.
    (d)   Customer acknowledges that APRIVA has or may enter into agreements
with certain third parties, including wireless carrier networks (a “Third Party
Provider”), in connection with the APRIVA Services. In consideration for
utilizing any Third Party Provider services, Customer and each of its Merchants
are bound by the following restrictions and terms:

  (1)   Customer and each of its Merchants must abide by all applicable
statutes, laws, ordinances, rules and regulations and use a Third Party
Provider’s services so as not to cause undue interference with any other users
of such services.     (2)   Customer and each of its Merchants are responsible
for developing and maintaining procedures external to a Third Party Provider’s
networks to safeguard programs and data and for the backup and reconstruction of
lost data, programs or procedures.     (3)   Customer releases, and will require
each of its Merchants who access the APRIVA Services to release, each Third
Party Provider from all liability for the loss or alteration of programs or data
or its acquisition by another party, unless such loss or alteration results from
such Third Party Provider’s failure to implement security procedures that are
under such Third Party Provider’s control. No Third Party Provider will be
responsible for transmission errors, corruption of data or for the security of
data during transmission via public telecommunications facilities.     (4)   Any
and all programs and other materials provided by a Third Party Provider to
APRIVA for distribution to or use by Customer or any of its existing or
prospective merchants in connection with such Third Party Provider’s services
shall remain the exclusive and confidential property of such Third Party
Provider, are licensed solely for use in conjunction with such Third Party
Provider’s services, shall not be reproduced or copied except as required for
the authorized use of such Third Party Provider’s services, and shall be
returned to such Third Party upon request.

  (e)   All copyrights, patents, patent rights, trade secrets, trademarks,
servicemarks, tradenames, moral rights and other intellectual property and
proprietary rights in the APRIVA Services are and will remain the sole and
exclusive property of, as applicable, APRIVA or its Third Party Providers. All
rights not expressly granted to the Customer under this Paragraph are expressly
reserved by APRIVA and its Third Party Providers. Customer may publicly state
that it is an “authorized re-seller of the APRIVA Services” or use APRIVA’s
“authorized reseller” logo as supplied by

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      FDMS. If Customer uses the APRIVA “authorized reseller” logo, Customer
agrees that it will not alter it in any manner. Except for materials provided by
APRIVA, Customer shall submit all packaging, artwork, and other promotional
materials, including, but not limited to, advertising art and copy, to FDMS for
approval by APRIVA, which will be given in APRIVA’s sole discretion.     (f)  
APRIVA may suspend the APRIVA Services provided to FDMS, Customer or any of
Customer’s Merchants to: (1) prevent damages to, or degradation of, its network
integrity which may be caused by FDMS, any FDMS customer or such customer’s
merchants, (2) comply with any law, regulation, court order or other
governmental request which requires immediate action, or (3) otherwise protect
APRIVA in its good faith judgment from potential legal liability. To the extent
commercially reasonable, APRIVA shall give notice before suspending or
terminating the APRIVA Services. If not commercially reasonable to give prior
notice, APRIVA shall give notice to the Customer as soon as commercially
practicable thereafter. In the event of a suspension, APRIVA shall promptly
restore the APRIVA Services after the event giving rise to the suspension has
been resolved.     (g)   Customer agrees that it shall (1) establish its own
prices and policies with respect to all matters relating to sales of the APRIVA
Services to any existing or prospective merchants, (2) not be deemed to be an
agent, servant, or employee of APRIVA or FDMS, (3) have no authority to bind
APRIVA or FDMS in any manner and (4) make no representation to the contrary to
any existing or prospective merchant. Customer is solely responsible for
ensuring that each of its Merchants complies with the terms of this Paragraph.  
  (h)   FDMS AND APRIVA DO NOT WARRANT THAT THE APRIVA SERVICES WILL MEET THE
REQUIREMENTS OF CUSTOMER OR ANY OF ITS MERCHANTS OR THAT THE OPERATION OF THE
APRIVA SERVICES WILL BE UNINTERRUPTED OR ERROR-FREE OR THAT DEFECTS IN THE
APRIVA SERVICES WILL BE CORRECTED. NO ORAL OR WRITTEN INFORMATION OR ADVICE
GIVEN BY FDMS OR FDMS’S AUTHORIZED REPRESENTATIVE OR BY APRIVA OR APRIVA’S
AUTHORIZED REPRESENTATIVES SHALL CREATE A WARRANTY OR IN ANY WAY INCREASE THE
SCOPE OF THE WARRANTIES, IF ANY, PROVIDED BY FDMS OR APRIVA WITH THE APRIVA
SERVICES.     (i)   IN NO EVENT SHALL FDMS, APRIVA OR ANY THIRD PARTY PROVIDER
BE LIABLE TO CUSTOMER OR ANY THIRD PARTY, INCLUDING ANY OF THE CUSTOMER’S
MERCHANTS, FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING, WITHOUT
LIMITATION, INDIRECT, SPECIAL, PUNITIVE, OR EXEMPLARY DAMAGES FOR LOSS OF
BUSINESS, LOSS OF PROFITS, LOSS OF GOODWILL OR BUSINESS REPUTATION, BUSINESS
INTERRUPTION, LOSS OF DATA, OR LOSS OF BUSINESS INFORMATION) ARISING OUT OF OR
CONNECTED IN ANY

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      WAY WITH THE APRIVA SERVICES, OR FOR ANY CLAIM BY CUSTOMER OR ANY THIRD
PARTY, INCLUDING ANY OF THE CUSTOMER’S MERCHANTS, EVEN IF ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES. No action by the Customer, FDMS or APRIVA arising
in connection with the APRIVA Services may be brought at any time more than
twelve (12) months after the facts occurred upon which the cause of action
arose.     (j)   THE TOTAL LIABILITY OF FDMS, APRIVA AND THIRD PARTY PROVIDERS
TO CUSTOMER, INCLUDING CUSTOMER’S MERCHANTS, FOR ALL DAMAGES, LOSSES, AND CAUSES
OF ACTION (WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE), OR OTHERWISE) SHALL
NOT EXCEED THE AMOUNTS PAID BY CUSTOMER TO FDMS FOR THE APRIVA SERVICES DURING
THE SIX MONTHS PRIOR TO THE EVENT CAUSING LIABILITY.     (k)   Customer agrees
to indemnify, defend and hold FDMS and APRIVA harmless against any and all
liabilities, losses, damages, judgments, claims, causes of action, and costs
(including reasonable attorneys’ fees and disbursements) which FDMS or APRIVA
may hereafter incur, suffer, or be required to pay, defend, settle (subject to
any limitations set forth in this Paragraph), or satisfy as a result of the
following: (1) representations or warranties made by Customer that have not been
approved in writing by APRIVA, (2) Customer’s use of the APRIVA Services in
excess of the rights conferred in this Paragraph, or (3) any claim or action
filed by any of Customer’s Merchants not related to FDMS’s or APRIVA’s actions
or inactions.     (l)   FDMS and APRIVA shall have no liability with respect to
claims caused by (1) modifications to the APRIVA Services requested by Customer
or any of its Merchants, (2) derivative works created by Customer or any of its
Merchants based on the APRIVA Services, (3) use of the APRIVA Services in
combination with non-APRIVA approved third party services, including hardware
and software, (4) modifications or maintenance of the APRIVA Services by a party
other than APRIVA, (5) misuse of the APRIVA Services, or (6) failure of Customer
or any of its Merchants to implement any improvement or updates to the APRIVA
Services, if such claim would have been avoided by the use of the improvement or
updates.     (m)   APRIVA and its Third Party Providers are third party
beneficiaries of this Paragraph.     (n)   Notwithstanding anything in this
Agreement to the contrary, FDMS’s obligation to provide the APRIVA Services to
Customer and each of Customer’s Merchants will terminate automatically without
penalty to FDMS upon the earlier of (i) the termination or expiration of FDMS’s
agreement with APRIVA or (ii) the occurrence of any event causing FDMS to cease
providing the APRIVA Services.”

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     3. Section II of Exhibit “B” to the Service Agreement is hereby amended by
the addition of the following:
Additional Pricing:

          Description       Fee
Set-Up Fee
  Per Terminal set-up/activation fee to access the APRIVA services.   $ *
/terminal set-up
APRIVA Deployment Over Box — phone & printer set
  APRIVA Deployment Over Box — phone & printer set   $ * /each
APRIVA Secure Charger
  Adaptor Secure SC30BC Charger   $ * /each
APRIVA Secure Printer
  Celltek Extech Printer EP-S1000BT   $ * /each
APRIVA Shipping Phone & Printer Ground
  APRIVA Shipping Phone & Printer Ground   Pass-thru
APRIVA SIMS Chip
  Apriva Sim Chip   $ * /each
APRIVA Monthly Access Fee
  Per terminal per month fee to access to the APRIVA services with out WAY
SERVICES.   $ * /terminal per month
APRIVA Monthly Access Fee WAY SERVICES
  Per terminal per month fee to access to the APRIVA services with WAY SERVICES.
  $ * /terminal per month
APRIVA Transaction Fee
  Switching fee per inquiry to access the APRIVA services without WAY SERVICES.
Authorization fees per inquiry will also apply.   $ * /transaction
APRIVA Transaction Fee WAY SERVICES
  Switching fee per inquiry to access the APRIVA services with WAY SERVICES.
Authorization fees per inquiry will also apply.   $ * /transaction

     4. Capitalized terms used but not otherwise defined in this Amendment will
have the meanings set forth in the Service Agreement.
     5. In the event of a conflict between this Amendment and the Service
Agreement as it relates to the subject matter hereof, the terms of this
Amendment will control. Otherwise, all terms and conditions of the Service
Agreement will remain in full force and effect and likewise apply to this
Amendment.
[Signature page follows.]
 

*   Omitted pursuant to a confidential treatment request. The confidential
portion has been separately filed with the SEC.

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The parties have executed this Amendment as of the date first above written.
FIRST DATA MERCHANT SERVICES CORPORATION

                  By:   /s/ Rick Learch       Name:   Rick Learch      Title:  
SVP        iPAYMENT, INC.
      By:   /s/ Greg Daily       Name:   Greg Daily      Title:   CEO     

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