EXHIBIT 10.1
FORM OF INDEMNIFICATION AGREEMENT
          THIS INDEMNIFICATION AGREEMENT (this “Agreement”) is made and entered
into as of ____________, 20__ between IPAYMENT, INC., a Delaware corporation
(the “Company”), and ____________ (“Indemnitee”). Capitalized terms not defined
elsewhere in this Agreement are used as defined in Section 12.
WITNESSETH:
     WHEREAS, Indemnitee performs a valuable service for the Company;
     WHEREAS, the by-laws of the Company (as they may be amended from time to
time, the “By-Laws”) require indemnification of the officers and directors of
the Company;
     WHEREAS, this Agreement is a supplement to and in furtherance of the
By-Laws and any resolutions adopted pursuant thereto, and shall not be deemed a
substitute therefor, nor to diminish or abrogate any rights of Indemnitee
thereunder;
     WHEREAS, the By-Laws and the General Corporation Law of the State of
Delaware (as it may be amended from time to time, the “DGCL”), by their
nonexclusive nature, permit contracts between the Company and the officers or
directors of the Company with respect to indemnification of such officers or
directors; and
     WHEREAS, in order to induce Indemnitee to serve as an officer and/or
director of the Company, the Company has determined and agreed to enter into
this contract with and for the benefit of Indemnitee.
     NOW, THEREFORE, in consideration of Indemnitee’s agreement to serve as an
officer and/or director from and after the date hereof, the parties hereto agree
as follows:
          1. Indemnity of Indemnitee. The Company hereby agrees as set forth
herein to hold harmless and indemnify Indemnitee to the fullest extent permitted
by applicable laws, as such may be amended from time to time. In furtherance of
the foregoing indemnification, and without limiting the generality thereof:
               (a) Proceedings Other Than Proceedings by or in the Right of the
Company. Indemnitee shall be entitled to the rights of indemnification provided
in this Section l(a) if, by reason of his Corporate Status, Indemnitee is, or is
threatened to be made, a party to or participant in any Proceeding other than a
Proceeding by or in the right of the Company. Pursuant to this Section 1(a),
Indemnitee shall be indemnified against all Expenses, judgments, penalties,
fines and amounts paid in settlement actually and reasonably incurred by him, or
on his behalf, in connection with such Proceeding or any claim, issue or matter
therein, if Indemnitee acted in good faith and in a manner Indemnitee reasonably
believed to be in or not opposed to the best interests of the Company, and with
respect to any criminal Proceeding, had no reasonable cause to believe
Indemnitee’s conduct was unlawful.

 

--------------------------------------------------------------------------------

 

               (b) Proceedings by or in the Right of the Company. Indemnitee
shall be entitled to the rights of indemnification provided in this Section 1(b)
if, by reason of his Corporate Status, Indemnitee is, or is threatened to be
made, a party to or participant in any Proceeding brought by or in the right of
the Company. Pursuant to this Section 1(b), Indemnitee shall be indemnified
against all Expenses actually and reasonably incurred by Indemnitee, or on
Indemnitee’s behalf, in connection with such Proceeding if Indemnitee acted in
good faith and in a manner Indemnitee reasonably believed to be in or not
opposed to the best interests of the Company; provided, however, if applicable
laws so provide, no indemnification against such Expenses shall be made in
respect of any claim, issue or matter in such Proceeding as to which Indemnitee
shall have been adjudged to be liable to the Company unless and to the extent
that the Court of Chancery of the State of Delaware (the “Delaware Court”) shall
determine that such indemnification may be made.
               (c) Indemnification for Expenses of a Party Who is Wholly or
Partly Successful. Notwithstanding any other provision of this Agreement, to the
extent that Indemnitee is, by reason of his Corporate Status, a party to and is
successful, on the merits or otherwise, in any Proceeding, he shall be
indemnified to the maximum extent permitted by applicable laws, as such may be
amended from time to time, against all Expenses actually and reasonably incurred
by him or on his behalf in connection therewith. If Indemnitee is not wholly
successful in such Proceeding but is successful, on the merits or otherwise, as
to one or more but less than all claims, issues or matters in such Proceeding,
the Company shall indemnify Indemnitee against all Expenses actually and
reasonably incurred by him or on his behalf in connection with each successfully
resolved claim, issue or matter. For purposes of this Section 1(c) and without
limitation, the termination of any claim, issue or matter in such a Proceeding
by dismissal, with or without prejudice, shall be deemed to be a successful
result as to such claim, issue or matter.
          2. Additional Indemnity. In addition to, and without regard to any
limitations on, the indemnification provided for in Section 1 of this Agreement,
the Company shall and hereby does indemnify and hold harmless Indemnitee against
all Expenses, judgments, penalties, fines and amounts paid in settlement
actually and reasonably incurred by him or on his behalf if, by reason of his
Corporate Status, he is, or is threatened to be made, a party to or participant
in any Proceeding (including, without limitation, a Proceeding by or in the
right of the Company), including, without limitation, all liability arising out
of the negligence or active or passive wrongdoing of Indemnitee. The only
limitation that shall exist upon the Company’s obligations pursuant to this
Agreement shall be that the Company shall not be obligated to make any payment
to Indemnitee that is finally determined (under the procedures, and subject to
the presumptions, set forth in Sections 6 and 7 hereof) to be unlawful.
          3. Contribution.
               (a) Whether or not the indemnification provided in Sections 1 and
2 hereof is available, in respect of any threatened, pending or completed
action, suit or proceeding in which the Company is jointly liable with
Indemnitee (or would be so liable if joined in such action, suit or proceeding),
the Company shall pay, in the first instance, the entire amount of any judgment
or settlement of such action, suit or proceeding without requiring Indemnitee to
contribute to such payment and the Company hereby waives and relinquishes any
right of contribution it may have against Indemnitee. The Company shall not,
without Indemnitee’s prior

2

--------------------------------------------------------------------------------

 

written consent, enter into any settlement (in whole or in part) of any action,
suit or proceeding in which the Company is jointly liable with Indemnitee (or
would be so liable if joined in such action, suit or proceeding) unless such
settlement (i) provides for a full and final release of all claims asserted
against Indemnitee and (ii) does not impose any Expense, judgment, fine or
penalty (not otherwise borne by the Company pursuant to the terms hereof) or any
limitation on Indemnitee.
               (b) Without diminishing or impairing the obligations of the
Company set forth in the preceding paragraph, if, for any reason, Indemnitee
shall elect or be required to pay all or any portion of any judgment or
settlement in any threatened, pending or completed action, suit or proceeding in
which the Company is jointly liable with Indemnitee (or would be so liable if
joined in such action, suit or proceeding), the Company shall contribute to the
amount of Expenses, judgments, fines and amounts paid in settlement actually and
reasonably incurred and paid or payable by Indemnitee in proportion to the
relative benefits received by the Company and all officers, directors or
employees of the Company, other than Indemnitee, who are jointly liable with
Indemnitee (or would be so liable if joined in such action, suit or proceeding),
on the one hand, and Indemnitee, on the other hand, from the transaction or
events from which such action, suit or proceeding arose; provided, however, that
the proportion determined on the basis of relative benefit may, to the extent
necessary to conform to applicable laws, be further adjusted by reference to the
relative fault of the Company and all officers, directors or employees of the
Company other than Indemnitee who are jointly liable with Indemnitee (or would
be so liable if joined in such action, suit or proceeding), on the one hand, and
Indemnitee, on the other hand, in connection with the transaction or events that
resulted in such expenses, judgments, fines or settlement amounts, as well as
any other equitable considerations which applicable laws may require to be
considered. The relative fault of the Company and all officers, directors or
employees of the Company, other than Indemnitee, who are jointly liable with
Indemnitee (or would be so liable if joined in such action, suit or proceeding),
on the one hand, and Indemnitee, on the other hand, shall be determined by
reference to, among other things, the degree to which their actions were
motivated by intent to gain personal profit or advantage, the degree to which
their liability is primary or secondary and the degree to which their conduct is
active or passive.
               (c) The Company hereby agrees to fully indemnify and hold
Indemnitee harmless from any claims of contribution which may be brought by
officers, directors or employees of the Company, other than Indemnitee, who may
be jointly liable with Indemnitee.
               (d) To the fullest extent permissible under applicable laws, if
the indemnification provided for in this Agreement is unavailable to Indemnitee
for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee,
shall contribute to the amount incurred by Indemnitee, whether for judgments,
fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or
for Expenses, in connection with any claim relating to an indemnifiable event
under this Agreement, in such proportion as is deemed fair and reasonable in
light of all of the circumstances of such Proceeding in order to reflect (i) the
relative benefits received by the Company and Indemnitee as a result of the
event(s) and/or transaction(s) giving cause to such Proceeding; and/or (ii) the
relative fault of the Company (and its directors, officers, employees and
agents) and Indemnitee in connection with such event(s) and/or transaction(s).

3

--------------------------------------------------------------------------------

 

          4. Indemnification for Expenses of a Witness. Notwithstanding any
other provision of this Agreement, to the extent that Indemnitee is, by reason
of his Corporate Status, a witness, or is made (or asked) to respond to
discovery requests, in any Proceeding to which Indemnitee is not a party, he
shall be indemnified against all Expenses actually and reasonably incurred by
him or on his behalf in connection therewith.
          5. Advancement of Expenses. Notwithstanding any other provision of
this Agreement, the Company shall advance all Expenses incurred by or on behalf
of Indemnitee in connection with any Proceeding by reason of Indemnitee’s
Corporate Status within thirty (30) days after the receipt by the Company of a
statement or statements from Indemnitee requesting such advance or advances from
time to time, whether prior to or after final disposition of such Proceeding.
Such statement or statements shall reasonably evidence the Expenses incurred by
Indemnitee and shall include or be preceded or accompanied by a written
undertaking by or on behalf of Indemnitee to repay any Expenses advanced if it
shall ultimately be determined that Indemnitee is not entitled to be indemnified
against such Expenses. Any advances and undertakings to repay pursuant to this
Section 5 shall be unsecured and interest free.
          6. Procedures and Presumptions for Determination of Entitlement to
Indemnification. It is the intent of this Agreement to secure for Indemnitee
rights of indemnity that are as favorable as may be permitted under the DGCL and
public policy of the State of Delaware. Accordingly, the parties agree that the
following procedures and presumptions shall apply in the event of any question
as to whether Indemnitee is entitled to indemnification under this Agreement:
               (a) To obtain indemnification under this Agreement, Indemnitee
shall submit to the Company a written request, including therein or therewith
such documentation and information as is reasonably available to Indemnitee and
is reasonably necessary to determine whether and to what extent Indemnitee is
entitled to indemnification. The Secretary of the Company shall, promptly upon
receipt of such a request for indemnification, advise the Board of Directors of
the Company (the “Board”) in writing that Indemnitee has requested
indemnification. Notwithstanding the foregoing, any failure of Indemnitee to
provide such a request to the Company, or to provide such a request in a timely
fashion, shall not relieve the Company of any liability that it may have to
Indemnitee unless, and to the extent that, such failure actually and materially
prejudices the interests of the Company.
               (b) Upon written request by Indemnitee for indemnification
pursuant to the first sentence of Section 6(a) hereof, a determination with
respect to Indemnitee’s entitlement thereto shall be made in the specific case
by one of the following four methods, which shall be at the election of the
Board: (1) by a majority vote of the Disinterested Directors, even though less
than a quorum, (2) by a committee of Disinterested Directors designated by a
majority vote of the Disinterested Directors, even though less than a quorum,
(3) if there are no Disinterested Directors or if the Disinterested Directors so
direct, by Independent Counsel in a written opinion to the Board, a copy of
which shall be delivered to Indemnitee or (4) by the stockholders of the
Company.
               (c) If the determination of entitlement to indemnification is to
be made by Independent Counsel pursuant to Section 6(b) hereof, the Independent
Counsel shall be selected as provided in this Section 6(c). The Independent
Counsel shall be selected by the

4

--------------------------------------------------------------------------------

 

Board, and the Company shall give written notice to the Indemnitee advising him
of the identity of the Independent Counsel so selected. Indemnitee may, within
ten (10) days after such written notice of selection shall have been given,
deliver to the Company a written objection to such selection; provided, however,
that such objection may be asserted only on the ground that the Independent
Counsel so selected does not meet the requirements of “Independent Counsel” as
defined in Section 12 of this Agreement, and the objection shall set forth with
particularity the factual basis of such assertion. Absent a proper and timely
objection, the person so selected shall act as Independent Counsel. If a written
objection is made and substantiated, the Independent Counsel selected may not
serve as Independent Counsel unless and until such objection is withdrawn or a
court has finally determined that such objection is without merit. If, within
twenty (20) days after submission by Indemnitee of a written request for
indemnification pursuant to Section 6(a) hereof, no Independent Counsel shall
have been selected and not objected to, either the Company or Indemnitee may
petition the Delaware Court or other court of competent jurisdiction for
resolution of any objection which shall have been made by Indemnitee to the
Company’s selection of Independent Counsel and/or for the appointment as
Independent Counsel of a person selected by the court or by such other person as
the court shall designate, and the person with respect to whom all objections
are so resolved or the person so appointed shall act as Independent Counsel
under Section 6(b) hereof. The Company shall pay any and all reasonable fees and
expenses of Independent Counsel incurred by such Independent Counsel in
connection with acting pursuant to Section 6(b) hereof, and the Company shall
pay all reasonable fees and expenses incident to the procedures of this
Section 6(c), regardless of the manner in which such Independent Counsel was
selected or appointed.
               (d) In making a determination with respect to entitlement to
indemnification hereunder, the person or persons or entity making such
determination shall presume that Indemnitee is entitled to indemnification under
this Agreement. Anyone seeking to overcome this presumption shall have the
burden of proof and the burden of persuasion by clear and convincing evidence.
Neither the failure of the Company (including, without limitation, by its
directors or legal counsel) to have made a determination prior to the
commencement of any action pursuant to this Agreement that indemnification is
proper in the circumstances because Indemnitee has met the applicable standard
of conduct, nor an actual determination by the Company (including, without
limitation, by its directors or legal counsel) that Indemnitee has not met such
applicable standard of conduct, shall be a defense to the action or create a
presumption that Indemnitee has not met the applicable standard of conduct.
               (e) Indemnitee shall be deemed to have acted in good faith if
Indemnitee’s action is based on the records or books of account of the
Enterprise, including, without limitation, financial statements, or on
information supplied to Indemnitee by the officers of the Enterprise in the
course of their duties, or on the advice of legal counsel for the Enterprise or
on information or records given or reports made to the Enterprise by an
independent certified public accountant or by an appraiser or other expert
selected with reasonable care by the Enterprise. In addition, the knowledge
and/or actions, or failure to act, of any director, officer, agent or employee
of the Enterprise (other than Indemnitee) shall not be imputed to Indemnitee for
purposes of determining the right to indemnification under this Agreement.
Whether or not the foregoing provisions of this Section 6(e) are satisfied, it
shall in any event be presumed that Indemnitee has at all times acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the Company. Anyone seeking to overcome this presumption shall have
the burden of proof and the burden of persuasion by clear and convincing
evidence.

5

--------------------------------------------------------------------------------

 

               (f) If the person, persons or entity empowered or selected under
this Section 6 to determine whether Indemnitee is entitled to indemnification
shall not have made a determination within sixty (60) days after receipt by the
Company of the request therefor, the requisite determination of entitlement to
indemnification shall be deemed to have been made and Indemnitee shall be
entitled to such indemnification absent (i) a misstatement by Indemnitee of a
material fact, or an omission of a material fact necessary to make Indemnitee’s
statement not materially misleading, in connection with the request for
indemnification, or (ii) a prohibition of such indemnification under applicable
laws.
               (g) Indemnitee shall cooperate with the person, persons or entity
making such determination with respect to Indemnitee’s entitlement to
indemnification, including, without limitation, providing to such person,
persons or entity upon reasonable advance request any documentation or
information which is not privileged or otherwise protected from disclosure and
which is reasonably available to Indemnitee and reasonably necessary to such
determination. Any Independent Counsel, member of the Board or stockholder of
the Company shall act reasonably and in good faith in making a determination
regarding Indemnitee’s entitlement to indemnification under this Agreement. Any
costs or expenses (including, without limitation, attorneys’ fees and
disbursements) reasonably incurred by Indemnitee in so cooperating with the
person, persons or entity making such determination shall be borne by the
Company (irrespective of the determination as to Indemnitee’s entitlement to
indemnification) and the Company hereby indemnifies and agrees to hold
Indemnitee harmless therefrom.
               (h) The Company acknowledges that a settlement or other
disposition short of final judgment may be successful if it permits a party to
avoid expense, delay, distraction, disruption and uncertainty. In the event that
any action, claim or proceeding to which Indemnitee is a party is resolved in
any manner other than by adverse judgment against Indemnitee (including, without
limitation, settlement of such action, claim or proceeding with or without
payment of money or other consideration) it shall be presumed that Indemnitee
has been successful on the merits or otherwise in such action, suit or
proceeding. Anyone seeking to overcome this presumption shall have the burden of
proof and the burden of persuasion by clear and convincing evidence.
               (i) The termination of any Proceeding or of any claim, issue or
matter therein, by judgment, order, settlement or conviction, or upon a plea of
nolo contendere or its equivalent, shall not (except as otherwise expressly
provided in this Agreement) of itself adversely affect the right of Indemnitee
to indemnification or create a presumption that Indemnitee did not act in good
faith and in a manner which he reasonably believed to be in or not opposed to
the best interests of the Company or, with respect to any criminal Proceeding,
that Indemnitee had reasonable cause to believe that his conduct was unlawful.
          7. Remedies of Indemnitee.
               (a) In the event that (i) a determination is made pursuant to
Section 6 of this Agreement that Indemnitee is not entitled to indemnification
under this Agreement, (ii) advancement of Expenses is not timely made pursuant
to Section 5 of this Agreement, (iii) no determination of entitlement to
indemnification is made pursuant to Section 6(b) of this Agreement within sixty
(60) days after receipt by the Company of the request for

6

--------------------------------------------------------------------------------

 

indemnification, (iv) payment of indemnification is not made pursuant to this
Agreement within thirty (30) days after receipt by the Company of a written
request therefor or (v) payment of indemnification is not made within ten
(10) days after a determination has been made that Indemnitee is entitled to
indemnification or such determination is deemed to have been made pursuant to
Section 6 of this Agreement, Indemnitee shall be entitled to an adjudication in
an appropriate court of the State of Delaware, or in any other court of
competent jurisdiction, of Indemnitee’s entitlement to such indemnification,
contribution or advancement of Expenses. Alternatively, Indemnitee, at his
option, may seek an award in arbitration to be conducted by a single arbitrator
pursuant to the Commercial Arbitration Rules of the American Arbitration
Association. Except as set forth herein, the provisions of Delaware law (without
regard to its conflict of law rules) shall apply to any such arbitration.
Indemnitee shall commence such proceeding seeking an adjudication or an award in
arbitration within one hundred eighty (180) days following the date on which
Indemnitee first has the right to commence such proceeding pursuant to this
Section 7(a). The Company shall not oppose Indemnitee’s right to seek any such
adjudication or award in arbitration.
               (b) In the event that a determination shall have been made
pursuant to Section 6(b) of this Agreement that Indemnitee is not entitled to
indemnification, any judicial proceeding or arbitration commenced pursuant to
this Section 7 shall be conducted in all respects as a de novo proceeding or
arbitration on the merits, and Indemnitee shall not be prejudiced by reason of
the adverse determination under Section 6(b). In any judicial proceeding or
arbitration commenced pursuant to this Section 7, Indemnitee shall be presumed
to be entitled to indemnification under this Agreement and the Company shall
have the burden of proving Indemnitee is not entitled to indemnification or
advancement of Expenses, as the case may be, and the Company may not refer to or
introduce into evidence any determination pursuant to Section 6(b) of this
Agreement adverse to Indemnitee for any purpose. If Indemnitee commences a
judicial proceeding or arbitration pursuant to this Section 7, Indemnitee shall
not be required to reimburse the Company for any advances pursuant to Section 5
until a final determination is made with respect to Indemnitee’s entitlement to
indemnification (as to which all rights of appeal have been exhausted or
lapsed).
               (c) If a determination shall have been made pursuant to
Section 6(b) of this Agreement that Indemnitee is entitled to indemnification,
the Company shall be bound by such determination in any judicial proceeding
commenced pursuant to this Section 7, absent (i) a misstatement by Indemnitee of
a material fact, or an omission of a material fact necessary to make
Indemnitee’s misstatement not materially misleading in connection with the
application for indemnification, or (ii) a prohibition of such indemnification
under applicable laws.
               (d) In the event that Indemnitee, pursuant to this Section 7,
seeks a judicial adjudication of his rights under, or to recover damages for
breach of, this Agreement, or to recover under any directors’ and officers’
liability insurance policies maintained by the Company, the Company shall pay on
his behalf, in advance, any and all Expenses actually and reasonably incurred by
him in such judicial adjudication, regardless of whether Indemnitee ultimately
is determined to be entitled to such indemnification, advancement of expenses or
insurance recovery.
               (e) The Company shall be precluded from asserting in any judicial
proceeding commenced pursuant to this Section 7 that the procedures and
presumptions of this

7

--------------------------------------------------------------------------------

 

Agreement are not valid, binding and enforceable and shall stipulate in any such
court that the Company is bound by all the provisions of this Agreement. The
Company shall indemnify Indemnitee against any and all Expenses and, if
requested by Indemnitee, shall (within thirty (30) days after receipt by the
Company of a written request therefor) advance, to the extent not prohibited by
applicable laws, such expenses to Indemnitee, which are incurred by Indemnitee
in connection with any action brought by Indemnitee for indemnification or
advance of Expenses from the Company under this Agreement or under any
directors’ and officers’ liability insurance policies maintained by the Company,
regardless of whether Indemnitee ultimately is determined to be entitled to such
indemnification, advancement of Expenses or insurance recovery, as the case may
be.
               (f) Notwithstanding anything in this Agreement to the contrary,
no determination as to entitlement to indemnification under this Agreement shall
be required to be made prior to the final disposition of the Proceeding.
          8. Non-Exclusivity; Survival of Rights; Insurance; Primacy of
Indemnification; Subrogation.
               (a) The rights of indemnification and to receive advancement of
expenses as provided by this Agreement shall not be deemed exclusive of any
other rights to which Indemnitee may at any time be entitled under applicable
laws, the By-Laws, any agreement, a vote of stockholders, a resolution of the
Board, or otherwise. No supplement, modification, termination or amendment of
this Agreement or of any provision hereof shall limit or restrict any right of
Indemnitee under this Agreement in respect of any action taken or omitted by
such Indemnitee in his Corporate Status prior to such supplement, modification,
termination or amendment. To the extent that a change in the DGCL, whether by
statute or judicial decision, permits greater indemnification than would be
afforded currently under the By-Laws and this Agreement, it is the intent of the
parties hereto that Indemnitee shall enjoy by this Agreement the greater
benefits so afforded by such change. No right or remedy herein conferred is
intended to be exclusive of any other right or remedy, and every other right and
remedy shall be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other right or remedy.
               (b) To the extent that the Company maintains an insurance policy
or policies providing liability insurance for directors, officers, employees, or
agents or fiduciaries of the Company or of any other Enterprise, Indemnitee
shall be covered by such policy or policies in accordance with its or their
terms to the maximum extent of the coverage available for any director, officer,
employee, agent or fiduciary of the Company or of any other Enterprise under
such policy or policies. If, at the time of the receipt of a notice of a claim
pursuant to the terms hereof, the Company has directors’ and officers’ liability
insurance in effect, the Company shall give prompt notice of the commencement of
such proceeding to the insurers in accordance with the procedures set forth in
the respective policies. The Company shall thereafter take all necessary action
to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a
result of such proceeding in accordance with the terms of such policies.
               (c) In the event of any payment under this Agreement, the Company
shall be subrogated to the extent of such payment to all of the rights of
recovery of Indemnitee,

8

--------------------------------------------------------------------------------

 

who shall execute all papers required and take all necessary action to secure
such rights, including, without limitation, execution of such documents as are
necessary to enable the Company to bring suit to enforce such rights.
               (d) The Company shall not be liable under this Agreement to make
any payment of amounts otherwise indemnifiable hereunder if and to the extent
that Indemnitee has otherwise actually received such payment under any insurance
policy, contract, agreement or otherwise.
               (e) The Company’s obligation to indemnify or advance Expenses
hereunder to Indemnitee who is or was serving at the request of the Company as a
director, officer, employee or agent of any other Enterprise shall be reduced by
any amount Indemnitee has actually received as indemnification or advancement of
expenses from such other Enterprise.
          9. Exception to Right of Indemnification. Notwithstanding any
provision in this Agreement, the Company shall not be obligated under this
Agreement to make any indemnity in connection with any claim made against
Indemnitee:
               (a) for which payment has actually been made to or on behalf of
Indemnitee under any insurance policy or other indemnity provision, except with
respect to any excess beyond the amount paid under any insurance policy or other
indemnity provision;
               (b) for an accounting of profits made from the purchase and sale
(or sale and purchase) by Indemnitee of securities of the Company within the
meaning of Section 16(b) of the Exchange Act or similar provisions of state
statutory law or common law;
               (c) for reimbursement to the Company of any bonus or other
incentive-based or equity-based compensation or of any profits realized by
Indemnitee from the sale of securities of the Company in each case as required
under the Exchange Act; or
               (d) in connection with any Proceeding (or any part of any
Proceeding) initiated by Indemnitee, including, without limitation, any
Proceeding (or any part of any Proceeding) initiated by Indemnitee against the
Company or its directors, officers, employees or other indemnitees, unless
(i) the Company has joined in, or the Board has authorized, the Proceeding (or
any part of any Proceeding) prior to its initiation, (ii) the Company provides
the indemnification, in its sole discretion, pursuant to the powers vested in
the Company under applicable laws or (iii) the Proceeding is one to enforce
Indemnitee’s rights under this Agreement.
          10. Duration of Agreement. All agreements and obligations of the
Company contained herein shall continue during the period Indemnitee is an
officer and/or director of the Company (or is or was serving at the request of
the Company as a director, officer, employee or agent of another Enterprise) and
for ten (10) years thereafter, and shall continue thereafter so long as
Indemnitee shall be subject to any Proceeding (or any proceeding commenced under
Section 7 hereof) by reason of his Corporate Status, whether or not he is acting
or serving in any such capacity at the time any liability or expense is incurred
for which indemnification can be provided under this Agreement.

9

--------------------------------------------------------------------------------

 

          11. Security. To the extent requested by Indemnitee and approved by
the Board in its sole discretion, the Company may at any time and from time to
time provide security to Indemnitee for the Company’s obligations hereunder
through an irrevocable bank line of credit, funded trust or other collateral.
Any such security, once provided to Indemnitee, may not be revoked or released
without the prior written consent of Indemnitee.
          12. Definitions. For purposes of this Agreement:
               (a) “Corporate Status” means the status of a person who is or was
a director, officer, employee, agent or fiduciary of the Company or of any other
Enterprise.
               (b) “Disinterested Director” means a director of the Company who
is not and was not a party to the Proceeding in respect of which indemnification
is sought by Indemnitee.
               (c) “Enterprise” means the Company and any other corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise
that Indemnitee is or was serving at the request of the Company as a director,
officer, employee, agent or fiduciary.
               (d) “Exchange Act” shall mean the Securities Exchange Act of
1934, as amended.
               (e) “Expenses” means all reasonable attorneys’ fees, retainers,
court costs, transcript costs, fees of experts, witness fees, travel expenses,
duplicating costs, printing and binding costs, telephone charges, postage,
delivery service fees and all other disbursements or expenses of the types
customarily incurred in connection with prosecuting, defending, preparing to
prosecute or defend, investigating, participating, or being or preparing to be a
witness in a Proceeding, or responding to, or objecting to, a request to provide
discovery in any Proceeding. Expenses also shall include Expenses incurred in
connection with any appeal resulting from any Proceeding and any federal, state,
local or foreign taxes imposed on Indemnitee as a result of the actual or deemed
receipt of any payments under this Agreement, including, without limitation, the
premium, security for, and other costs relating to any cost bond, supersede as
bond, or other appeal bond or its equivalent. Expenses, however, shall not
include amounts paid in settlement by Indemnitee or the amount of judgments or
fines against Indemnitee.
               (f) “Independent Counsel” means a law firm, or a member of a law
firm, that is experienced in matters of corporation law and neither presently
is, nor in the past five years has been, retained to represent: (i) the Company
or Indemnitee in any matter material to either such party (other than with
respect to matters concerning Indemnitee under this Agreement, or of other
indemnitees under similar indemnification agreements), or (ii) any other party
to the Proceeding giving rise to a claim for indemnification hereunder.
Notwithstanding the foregoing, the term “Independent Counsel” shall not include
any person who, under the applicable standards of professional conduct then
prevailing, would have a conflict of interest in representing either the Company
or Indemnitee in an action to determine Indemnitee’s rights under this
Agreement. The Company agrees to pay the reasonable fees and expenses of the
Independent Counsel referred to above and to fully indemnify such counsel
against any and all

10

--------------------------------------------------------------------------------

 

Expenses, claims, liabilities and damages arising out of or relating to this
Agreement or its engagement pursuant hereto.
               (g) “Proceeding” means any threatened, pending or completed
action, suit, arbitration, alternate dispute resolution mechanism,
investigation, inquiry, administrative hearing or any other actual, threatened
or completed proceeding, whether brought by or in the right of the Company or
otherwise and whether civil, criminal, administrative or investigative, in which
Indemnitee was, is or will be involved as a party or otherwise, by reason of his
Corporate Status, by reason of any action taken by him or of any inaction on his
part while acting in his Corporate Status, in each case whether or not he is
acting or serving in any such capacity at the time any liability or expense is
incurred for which indemnification can be provided under this Agreement,
including, without limitation, one pending on or before the date of this
Agreement, but excluding one initiated by an Indemnitee pursuant to Section 7 of
this Agreement to enforce his rights under this Agreement.
          13. Severability. If any provision or provisions of this Agreement
shall be held to be invalid, illegal or unenforceable for any reason whatsoever:
(a) the validity, legality, and enforceability of the remaining provisions of
this Agreement (including, without limitation, each portion of any section,
paragraph or sentence of this Agreement containing any such provision held to be
invalid, illegal or unenforceable, that is not itself invalid, illegal or
unenforceable) shall not in any way be affected or impaired thereby and shall
remain enforceable to the fullest extent permitted by applicable laws; (b) such
provision or provisions shall be deemed reformed to the fullest extent necessary
to conform to applicable laws and to give the maximum effect to the intent of
the parties hereto; and (c) to the fullest extent possible, the provisions of
this Agreement (including, without limitation, each portion of any Section,
paragraph or sentence of this Agreement containing any such provision held to be
invalid, illegal or unenforceable, that is not itself invalid, illegal or
unenforceable) shall be construed so as to give effect to the intent manifested
thereby. Without limiting the generality of the foregoing, this Agreement is
intended to confer upon Indemnitee indemnification rights to the fullest extent
permitted by applicable laws.
          14. Enforcement and Binding Effect.
               (a) The Company expressly confirms and agrees that it has entered
into this Agreement and assumes the obligations imposed on it hereby in order to
induce Indemnitee to serve as an officer and/or director of the Company, and the
Company acknowledges that Indemnitee is relying upon this Agreement in serving
as an officer and/or director of the Company.
               (b) Without limiting any of the rights of Indemnitee under the
By-Laws and, if applicable, the Certificate of Incorporation of the Company (as
it may be amended from time to time), this Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter hereof
and supersedes all prior agreements (including, without limitation, any
indemnification agreement) and understandings, oral, written and implied,
between the parties hereto with respect to the subject matter hereof.

11

--------------------------------------------------------------------------------

 

               (c) The Company shall not seek from a court, or agree to, a “bar
order” which would have the effect of prohibiting or limiting Indemnitee’s
rights to receive advancement of expenses under this Agreement.
               (d) This Agreement shall be binding upon and be enforceable by
the parties hereto and their respective successors and assigns (including,
without limitation, any direct or indirect successor by purchase, merger,
consolidation or otherwise to all or substantially all of the business or assets
of the Company), shall continue as to an Indemnitee who has ceased to be a
director, officer, employee or agent of the Company or of any other Enterprise
at the Company’s request, and shall inure to the benefit of Indemnitee and his
spouse, assigns, heirs, devisees, executors and administrators and other legal
representatives.
               (e) The Company shall require and cause any successor (whether
direct or indirect by purchase, merger, consolidation or otherwise) to all,
substantially all or a substantial part, of the business and/or assets of the
Company to expressly to assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform if
no such succession had taken place.
               (f) The Company and Indemnitee agree herein that a monetary
remedy for breach of this Agreement, at some later date, may be inadequate,
impracticable and difficult to prove, and further agree that such breach may
cause Indemnitee irreparable harm. Accordingly, the parties hereto agree that
Indemnitee may enforce this Agreement by seeking injunctive relief and/or
specific performance hereof, without any necessity of showing actual damage or
irreparable harm and that by seeking injunctive relief and/or specific
performance, Indemnitee shall not he precluded from seeking or obtaining any
other relief to which he may be entitled. The Company and Indemnitee further
agree that Indemnitee shall be entitled to such specific performance and
injunctive relief, including, without limitation, temporary restraining orders,
preliminary injunctions and permanent injunctions, without the necessity of
posting bonds or other undertakings in connection therewith. The Company
acknowledges that in the absence of a waiver, a bond or undertaking may be
required of Indemnitee by the Court, and the Company hereby waives any such
requirement of such a bond or undertaking.
          15. Modification and Waiver. No supplement, modification, termination
or amendment of this Agreement shall be binding unless executed in writing by
both of the parties hereto. No waiver of any of the provisions of this Agreement
shall be deemed or shall constitute a waiver of any other provisions hereof
(whether or not similar) nor shall such waiver constitute a continuing waiver.
          16. Notice By Indemnitee. Indemnitee agrees to promptly notify the
Company in writing upon being served with or otherwise receiving any summons,
citation, subpoena, complaint, indictment, information or other document
relating to any Proceeding or matter which may be subject to indemnification
covered hereunder. The failure to so notify the Company shall not relieve the
Company of any obligation which it may have to Indemnitee under this Agreement
or otherwise, unless and only to the extent that such failure or delay
materially prejudices the Company.
          17. Notices. All notices and other communications given or made
pursuant to this Agreement shall be in writing and shall be deemed effectively
given: (a) upon personal

12

--------------------------------------------------------------------------------

 

delivery to the party to be notified, (b) when sent by confirmed electronic mail
or facsimile if sent during normal business hours of the recipient, and if not
so confirmed, then on the next business day, (c) five (5) days after having been
sent by registered or certified mail, return receipt requested, postage prepaid,
or (d) one (1) day after deposit with a nationally recognized overnight courier,
specifying next day delivery, with written verification of receipt. All
communications shall be sent:
               (a) To Indemnitee at the address set forth below Indemnitee
signature hereto.
               (b) To the Company at:
iPayment, Inc.
30721 Russell Ranch Road, Suite 200
Westlake Village, California 91362
Attention: Bronson Quon
Facsimile No.: 818) 540-6813
With a copy to:
White & Case LLP
1155 Avenue of the Americas
New York, New York 10036
Attention: Nazim Zilkha
Facsimile No.: 212-354-8113
or to such other address as may have been furnished to Indemnitee by the Company
or to the Company by Indemnitee, as the case may be.
          18. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same Agreement. This Agreement may also be
executed and delivered by PDF or facsimile signature and in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
          19. Headings. The headings of the paragraphs of this Agreement are
inserted for convenience only and shall not be deemed to constitute part of this
Agreement or to affect the construction thereof.
          20. Usage of Pronouns. Use of the masculine pronoun shall be deemed to
include usage of the feminine pronoun where appropriate.
          21. Governing Law and Consent to Jurisdiction. This Agreement and the
legal relations among the parties shall be governed by, and construed and
enforced in accordance with, the laws of the State of Delaware, without regard
to its conflict of laws rules. The Company and Indemnitee hereby irrevocably and
unconditionally (i) agree that any action or proceeding arising out of or in
connection with this Agreement shall be brought only in the Delaware Court, and
not in any other state or federal court in the United States of America or any
court in any

13

--------------------------------------------------------------------------------

 

other country, (ii) generally and unconditionally consent to submit to the
exclusive jurisdiction of the Delaware Court for purposes of any action or
proceeding arising out of or in connection with this Agreement, (iii) waive any
objection to the laying of venue of any such action or proceeding in the
Delaware Court, and (iv) waive, and agree not to plead or to make, any claim
that any such action or proceeding brought in the Delaware Court has been
brought in an improper or inconvenient forum. The foregoing consent to
jurisdiction shall not constitute general consent to service of process in the
state for any purpose except as provided above, and shall not be deemed to
confer rights on any person other than the parties to this Agreement.
(Signature page follows)

14

--------------------------------------------------------------------------------

 

          IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
and as of the day and year first written above.

            IPAYMENT, INC.
      By:           Name:           Title:        

 

--------------------------------------------------------------------------------

 

         
 
  INDEMNITEE    
 
       
 
       
 
       
 
  Name:    
 
  Title:    
 
       
 
  Address: