EXHIBIT 2.1

                            ASSET PURCHASE AGREEMENT

                                      among

                                 iPAYMENT, INC.,
                             a Delaware corporation,

                            CPS ACQUISITION, L.L.C.,
                      a Delaware limited liability company,


                          CARDPAYMENT SOLUTIONS, INC.,
                            a California corporation

                                ZACHARY A. HYMAN,

                                       and

                                MATTHEW B. HYMAN
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                                TABLE OF CONTENTS

ARTICLE I PURCHASE AND SALE OF ASSETS..........................................1
         1.01     Purchase and Sale............................................1
         1.02     Excluded Assets..............................................3
         1.03     Assumption of Liabilities....................................3
         1.04     Retained Liabilities.........................................4
         1.05     Purchase Price...............................................5
         1.06     Prorations...................................................5
         1.07     Allocation of Purchase Price.................................5
         1.08     Agent........................................................5
         1.09     Taxes........................................................5
ARTICLE II CLOSING    5
         2.01     Closing......................................................5
         2.02     Action of Company at Closing.................................6
         2.03     Action of Buyer at Closing...................................7
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE SELLERS......................8
         3.01     Corporate Organization; Etc..................................8
         3.02     Company's Corporate Powers; Absence of Conflicts With
                  Other Agreements, etc........................................9
         3.03     Controlling Shareholder's Capacity; Absence of Conflicts
                  With Other Agreements, etc...................................9
         3.04     Title to Assets.............................................10
         3.05     Capitalization..............................................10
         3.06     Company's Subsidiaries......................................10
         3.07     Financial Statements........................................10
         3.08     Undisclosed Liabilities.....................................11
         3.09     Post-Balance Sheet Results..................................11
         3.10     Merchant Accounts...........................................11
         3.11     Tax Matters.................................................12
         3.12     Contracts...................................................12
         3.13     Patents, Trademarks, Etc....................................13
         3.14     Employees...................................................14
         3.15     Labor Matters...............................................14
         3.16     Employee and Labor Matters; Employee Benefit Plans..........14
         3.17     Litigation..................................................16
         3.18     Compliance..................................................16
         3.19     Environmental Matters.......................................16
         3.20     Certain Payments............................................16
         3.21     No Conflict of Interest.....................................17
         3.22     Investment..................................................17
         3.23     Disclosure..................................................18
         3.24     Myisocenter.com, LLC........................................18
         3.25     Attrition Rate..............................................18
         3.26     Real Property...............................................19
         3.27     Chargebacks.................................................19
         3.28     Leasing Losses..............................................19
         3.29     Franchise Issues............................................19
         3.30     Ownership and Portability of Merchant Accounts..............19
         3.31     Employees and Independent Contractors.......................19
         3.32     Dissenters Rights...........................................20
         3.33     Independent Agent Contracts.................................20

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ARTICLE IV REPRESENTATIONS AND WARRANTIES OF BUYER AND HOLDINGS...............20
         4.01     Corporate Organization; Etc.................................20
         4.02     Buyer's Corporate Powers; Absence of Conflicts With
                  Other Agreements, etc.......................................20
         4.03     Holdings' Corporate Powers; Absence of Conflicts With
                  Other Agreements, etc.......................................21
         4.04     Capitalization..............................................21
         4.05     Compliance..................................................22
         4.06     Litigation..................................................22
         4.07     Disclosure..................................................22
         4.08     Disclosure to the SEC.......................................22
ARTICLE V COVENANTS PRIOR TO CLOSING..........................................22
         5.01     Commercially Reasonable Efforts.............................22
         5.02     Termination or Merger of Employee Benefit Plans.............22
         5.03     No Solicitation of Other Offers.............................23
         5.04     Confidentiality and Public Announcements....................23
         5.05     Tax Disclosure..............................................23
ARTICLE VI CONDITIONS TO CLOSING BY SELLERS...................................23
         6.01     Compliance..................................................23
         6.02     Action; Proceeding..........................................24
         6.03     Delivery of Certain Documents...............................24
         6.04     Employment Agreements.......................................24
         6.05     Non-Compete Agreements......................................24
ARTICLE VII CONDITIONS TO CLOSING BY BUYER AND HOLDINGS.......................24
         7.01     Compliance..................................................24
         7.02     Action; Proceeding..........................................24
         7.03     Delivery of Certain Documents...............................24
         7.04     Pension Plan Liability......................................25
         7.05     License.....................................................25
         7.06     UCC Lien Search.............................................25
         7.07     Intentionally Omitted.......................................25
         7.08     Intentionally Omitted.......................................25
         7.09     Name Change.................................................25
         7.10     No Adverse Change...........................................25
ARTICLE VIII POST CLOSING COVENANTS...........................................25
         8.01     Offerees....................................................25
         8.02     Further Assurances..........................................26
         8.03     Merchant Reserves...........................................26
         8.04     Trailing Activities.........................................26
         8.05     Name Change.................................................26
         8.06     Existence...................................................26
         8.07     Myisocenter.com, L.L.C......................................26
ARTICLE IX INDEMNIFICATION....................................................27
         9.01     Indemnification of Buyer and Holdings.......................27
         9.02     Indemnification of the Company and the Shareholders.........27
         9.03     Procedure for Indemnification - Non Third Party Claims......28
         9.04     Procedure for Indemnification - Third Party Claims..........28
         9.05     Survival Claims Period......................................29
         9.06     Amount Precedent to Any Indemnification Claim...............29
         9.07     Cap on Indemnification Liability............................30
         9.08     Payment.....................................................30
ARTICLE X TERMINATION 30
         10.01    Termination of Agreement....................................30

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         10.02    Effect of Termination.......................................30
ARTICLE XI MISCELLANEOUS PROVISIONS...........................................31
         11.01    No Brokerage................................................31
         11.02    Expenses....................................................31
         11.03    Misdirected Payments, Etc...................................31
         11.04    Third Party Beneficiary.....................................31
         11.05    Entire Agreement/Amendment..................................31
         11.06    Severability................................................31
         11.07    Waiver......................................................31
         11.08    Enforcement.................................................31
         11.09    Construction of Terms.......................................32
         11.10    Governing Law...............................................32
         11.11    Notices.....................................................32
         11.12    Assignment..................................................33
         11.13    Counterparts................................................33
         11.14    Consented Assignment........................................33
         11.15    Survival....................................................33
         11.16    Headings....................................................33
ARTICLE XII DEFINITIONS.......................................................34
TABLE OF SCHEDULES    40
TABLE OF EXHIBITS     42
<PAGE>

                            ASSET PURCHASE AGREEMENT

     This Asset Purchase Agreement (this  "Agreement"),  dated August 5, 2003 is
by  and  among  iPAYMENT,  INC.,  a  Delaware  corporation   ("Holdings"),   CPS
ACQUISITION,  L.L.C.  a Delaware  limited  liability  company and a wholly-owned
subsidiary  of Holdings  ("Buyer"),  CARDPAYMENT  SOLUTIONS,  INC., a California
corporation  (the  "Company"),  ZACHARY A.  HYMAN,  and MATTHEW B. HYMAN (each a
"Controlling  Shareholder,"  collectively  the "Controlling  Shareholders"  and,
together with the Company, the "Sellers").

                                   WITNESSETH:

     WHEREAS, the Company develops,  markets,  distributes,  sells and/or leases
credit card transaction  processing equipment,  services and systems or provides
electronic  payment  processing  services and systems and related  products (the
"Business");

     WHEREAS,  the Controlling  Shareholders are the owners of a majority of the
issued and  outstanding  shares of capital  stock of the  Company  indicated  on
Schedule 3.05 hereto; and

     WHEREAS,  the  Company  desires to sell and the Buyer  desires to  purchase
substantially  all of the assets used in  connection  with the  operation of the
Business.

     NOW,  THEREFORE,  in consideration of the mutual premises and covenants set
forth  herein  and  other  good and  valuable  consideration,  the  receipt  and
sufficiency of all of which are hereby acknowledged, the parties hereto agree as
follows:

                                    ARTICLE I
                           PURCHASE AND SALE OF ASSETS

     1.01  Purchase  and  Sale.  Subject  to the terms  and  conditions  of this
Agreement,  on the Closing Date,  Buyer shall  purchase from the Company and the
Company shall sell,  assign and deliver to Buyer,  good and marketable  title to
all of the assets used in connection with the Business,  other than the Excluded
Assets,  free and clear of all liens,  liabilities and  encumbrances  except for
Assumed Liabilities,  including without limitation the following  (collectively,
the "Assets"):

          (a) all of the  Company's  accounts  receivable  and  other  rights to
receive  payments  from any person or entity  relating to the  operation  of the
Business,  substantially  all of which are described in Schedule  1.01(a) hereto
(collectively, the "Receivables");

          (b)  all of  the  Company's  inventory,  substantially  all  of  which
inventory is described in Schedule 1.01(b) hereto;

          (c) all of the Company's right,  title and interest in and to the name
"CardPayment Solutions," together with all variations thereof (the "Tradename"),
all patents, trademarks, tradenames, service marks, domain names, trade secrets,
copyrights, computer software, inventions, techniques, schematics, manufacturing
and production processes and techniques,  research and development  information,
financial data, marketing data and plans, pricing and cost information, supplier
lists and information,  domain names and applications and registrations therefor
and  other  intellectual  property  rights  owned  by the  Company  and  used in
connection with the Business,  including without  limitation the items described
in Schedule 1.01(c) hereto  (collectively,  the "Owned Intellectual  Property"),
and the goodwill associated therewith;
<PAGE>

          (d)  all of the  tangible  personal  property  owned  by the  Company,
including  without  limitation the equipment,  machinery,  furniture,  fixtures,
leasehold improvements and similar items described in Schedule 1.01(d) hereto;

          (e) all of the Company's  interest in and to those capitalized  leases
of the Company described in Schedule 1.01(e) hereto (the "Capitalized Leases");

          (f) all of the Company's  interest in and to those operating leases of
the Company described in Schedule 1.01(f) hereto (the "Operating Leases");

          (g) all of the Company's  interest in and to the Processing  Agreement
described in Schedule 1.01(g) hereto (the "Processing Agreement");

          (h) all of the Company's interest in and to the Sponsorship  Agreement
described in Schedule 1.01(h) hereto (the "Sponsorship Agreement");

          (i) all of the Company's  interest in and to those certain  agreements
with  Merchants  substantially  in the form attached  hereto as Exhibit  1.01(i)
(collectively, the "Merchant Agreements");

          (j) all of the  Company's  interest,  if any, in and to those  certain
license and other  agreements to use patents,  trademarks,  tradenames,  service
marks, domain names, trade secrets, copyrights and other intellectually property
that is not Owned Intellectual  Property but that is used in connection with the
Business,  including  but not limited to Schedule  1.01(j)  hereto (the "License
Agreements");

          (k) all of the Company's ownership  interest,  if any, in and to those
other agreements described on Schedule 1.01(k) hereto (the "Contracts");

          (l) all of the  Company's  interest  in and to each  merchant  account
reserves,  deposits, security interests and any other collateral or security set
forth in or securing  the  obligations  to the  Company  pursuant to any Assumed
Contract,  including  without  limitation those described in Section 3.10 and on
Schedules 3.10(a), 3.10(b) and 3.10(c) (collectively, the "Deposits");

          (m) all of the  Company's  deposits,  escrows,  prepaid taxes or other
advance  payments  relating to any expense of the  Business,  including  without
limitation any rent or other  prepayment paid pursuant to any Assumed  Contract,
including without limitation those described in Schedule 1.01(m) hereto;

          (n) all of the Company's  rights pursuant to any warranty or guarantee
made by any manufacturer or supplier of products or services to the Company;

          (o) any and all records, documents, lists and copies of correspondence
related to past,  current or prospective  customers or Merchants of the Company,
including without limitation the list attached hereto as Schedule 1.01(o);

          (p) any and all documents,  files, records and correspondence relating
to the Business or the Merchants;

          (q) all claims,  other than those  presently  pursued by the  Company,
arising  from or in  connection  with the  Business  after the  Effective  Time,
whether known or unknown, contingent or otherwise;

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<PAGE>

          (r) all of the cash or  immediately  available  funds  received by the
Company  and the right to  receive  cash or  immediately  available  funds  from
Processor[s],  Sponsor  Bank[s] or others  arising  from or in  connection  with
transactions by Merchants  and/or the Business after the Effective Time that are
not  otherwise  referenced  or contained in any other  provision of this Section
1.01; and

          (s) all other tangible or intangible  property owned by the Company or
used in connection with the Business; and

          (t) all of the Company's  interest in and to those certain  agreements
with its independent  sales agents  substantially in the form attached hereto as
Exhibit 1.01(t) (collectively, the "Independent Agent Agreements").

     1.02 Other Excluded  Assets.  The following  assets are not intended by the
parties to be a part of the purchase and sale  hereunder  and are excluded  from
the Assets (collectively, the "Excluded Assets"):

          (a) the Company's articles of incorporation,  stock ledger,  corporate
record books, minute books;

          (b) the  Company's  financial  books and records,  including  books of
account, bank records and tax records;

          (c) the rights of Sellers  arising in connection  with this Agreement;
and

          (d) the  obligations  payable to the  Company by  shareholders  in the
amount of One Hundred  Twenty Nine Thousand Four Hundred  Thirty-Six  and 60/100
Dollars  ($129,436.60)  as noted on the  Company's  balance  sheet dated May 31,
2003; and

          (e) the assets of the Sellers  relating to the  Business  set forth on
Schedule 1.02(e).

     1.03  Assumption of Liabilities.  Contemporaneously  with the conveyance of
the Assets by the Company to Buyer,  the Company  shall  assign and  transfer to
Buyer, and Buyer shall accept, assume and agree to pay and perform the following
liabilities  and  obligations  of  the  Company   (collectively,   the  "Assumed
Liabilities"):

          (a) all obligations and liabilities of the Company to provide services
after the Closing  under the Assumed  Contracts to the extent that the Company's
rights  thereunder  are actually (with consent where  required)  assigned to the
Buyer  as set  forth  in the  Assignment  and  Assumption  Agreement,  provided,
however,  that the Buyer is not assuming any obligations or liabilities  arising
prior to the Closing other than the Assumed Chargeback  Liabilities,  or for any
breach  or  default,  under any  Assumed  Contracts  outstanding  at the time of
Closing or resulting from any event occurring before the Closing, which with the
giving of  notice or the  passage  of time or both  would  result in a breach or
default;

          (b) all  obligations  and liabilities of the Company under or pursuant
to all warranties or guarantees made by any manufacturer or supplier of products
or services to the Company to the extent that the  Company's  rights  thereunder
are actually assigned to Buyer;

          (c) the Assumed Chargeback Liabilities; and

          (d) the  liabilities and obligations of the Company in the amounts set
forth on Schedule 1.03(d) (the "Company Debt") not in excess of $1,412,048.42.

                                       3
<PAGE>

The  Buyer is not  assuming,  and  shall  not be  deemed  to have  assumed,  any
obligations  or  liabilities  of the Sellers other than the Assumed  Liabilities
specifically  described  above. No assumption by the Buyer of any of the Assumed
Liabilities shall relieve or be deemed to relieve the Company or any Controlling
Shareholder  from any obligation or liability  under this Agreement with respect
to any  representations  or  warranties  made by the Company or any  Controlling
Shareholder to the Buyer and Holdings.

     1.04 Retained  Liabilities.  Notwithstanding  anything in this Agreement to
the contrary,  the Buyer is not assuming and will not perform any liabilities or
obligations  not  specifically  described  in  Section  1.03,  whether  fixed or
contingent,  known or unknown, disclosed or undisclosed,  recorded or unrecorded
and whether relating to the Assets,  the Business or any other matter,  facts or
circumstances, including without limitation the following:

          (a) federal,  state or local Tax  liabilities  or  obligations  of the
Company and/or any Controlling  Shareholder whether or not incurred prior to the
date hereof or resulting from the consummation of the transactions  contemplated
herein,  and any and all other  taxes or amounts  due and payable as a result of
the  exercise by any of the  Company's  employees  of such  employees'  right to
vacation,  paid time off, sick leave and holiday  benefits  accrued while in the
employ of the Company;

          (b) any obligation or liability for services rendered by the Company;

          (c) any liability or obligation of the Company  arising as a result of
or out of any claim, any legal or equitable action,  proceeding or investigation
pertaining  to or  relating  in any way to the  Company  initiated  at any time,
whether  or not  described  in any  schedule  hereto,  except  for  the  Assumed
Chargeback Liabilities;

          (d)  any  obligation  or  liability  arising  out of  the  intentional
misconduct   or  negligent   acts  or  omissions  of  the  Company,   directors,
shareholders, officers or employees;

          (e) any liability or obligation of the Company  incurred in connection
with the making or performance of this Agreement;

          (f) any  liability  or  obligation  of the Company  arising out of any
Employee Benefit Plan, COBRA or HIPAA;

          (g) any liability or obligation of the Company for making  payments of
any kind  (including as a result of the sale of the Assets or as a result of the
termination  of employment by the Company of employees or other labor claims) to
employees  of the Company or in respect of payroll  taxes for  employees  of the
Company;

          (h)  liabilities  or  obligations  arising  out of any  breach  by the
Company prior to the Closing of any Assumed Contract;

          (i)  liabilities  or  obligations  of the  Company  arising  from  the
transactions contemplated in this Agreement,  including without limitation sales
taxes, legal fees and all other consulting fees;

          (j) the Retained Chargeback Liabilities; and

          (k) any interest,  penalties,  fines or other liabilities arising from
the  present  dispute  between  the Company  and the  Internal  Revenue  Service
regarding the Company's payroll taxes for 2002

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<PAGE>

have not yet been  remitted  to the IRS,  which  shall be paid in part by Seller
with the  reimbursement  received  from Buyer  pursuant to Section 11.18 of this
Agreement

     1.05  Purchase  Price.  Subject  to the terms and  conditions  hereof,  the
consideration  for the  purchase  and sale of the  Assets  shall  be as  follows
(collectively, the "Purchase Price"):

          (a) Buyer shall assume the Assumed Liabilities;

          (b) Buyer shall tender to the Company in cash or otherwise immediately
     available  funds (the "Cash") an aggregate  amount equal to Twelve  Million
     and No/100 Dollars ($12,000,000.00);

          (c)  Holdings  shall  deliver to the Escrow  Agent (as  defined in the
     Escrow Agreement)  attached hereto as Exhibit  2.02(o)),  within 10 days of
     the  Closing  Date,  a  certificate  issued  in  the  name  of  CardPayment
     Solutions, Inc. for 118,409 shares of the common stock, $0.01 par value per
     share,  of Holdings (the "Stock").  The Stock shall be held in escrow,  and
     will be held,  distributed  and otherwise  handled in  accordance  with the
     terms of the Escrow Agreement.

          (d) The Buyer shall deliver to the Company,  in cash,  the  contingent
     payments  corresponding  to the  achievement  by the  Buyer of the goals as
     enumerated in Schedule 1.05(d).

     1.06  Prorations.  After the  Closing  Date,  the  Company  and Buyer shall
prorate as of the  Closing  Date any  amounts  which  become due and  payable or
collectible  after the Closing  Date with respect to the Assumed  Contracts,  ad
valorem  taxes on the  Assets,  real  property  taxes  and  assessments  and all
utilities  servicing  any of the Assets,  including  without  limitation  water,
sewer,  telephone,  electricity,  gas service, and also including any income and
expense that may be settled after the Closing Date.

     1.07  Allocation  of  Purchase  Price.  The parties  hereto  agree that the
allocation of the Purchase  Price for tax purposes shall be made by Holdings and
shall be set forth in a statement  prepared  in  accordance  with the Code.  The
parties  shall  cooperate  in the  preparation  of such which  shall be filed as
required by applicable law.

     1.08 Agent.  Except as of the Closing  Date,  the Company  hereby  appoints
Buyer to act as its agent with respect to any and all merchant account reserves,
deposits,  security  interests or other collateral  securing  obligations to the
Company,  Processor,  Sponsor Bank,  or any Credit Card Company  pursuant to the
Processing   Agreement,   Sponsorship   Agreement  or  any  Merchant   Agreement
(collectively,  the "Reserves").  As such agent,  Buyer may direct,  in its sole
discretion,  the use of such  Reserves to satisfy any liability or obligation of
the Company or a Merchant to any Credit Card Company.

     1.09 Taxes. The Company shall be responsible for paying, and shall promptly
discharge when due, any transfer,  documentary,  sales, use, stamp, registration
and other  such  Taxes  incurred  in  connection  with the  consummation  of the
transactions contemplated by this Agreement.

                                   ARTICLE II
                                     CLOSING

     2.01 Closing.  The  consummation of the sale and purchase of the Assets and
the other transactions  contemplated  hereby (the "Closing") shall take place in
Nashville,  Tennessee,  at the  offices  of  Waller  Lansden  Dortch & Davis,  A
Professional Limited Liability Company, or other agreed upon location,  at 10:00
A.M. local time on the later of August 1, 2003 or such later date upon which the
parties

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<PAGE>

hereto  agree,  all of the  approvals  and  consents  required  pursuant to this
Agreement hereof have been obtained, or at such other time as the parties hereto
may mutually  designate in writing (the  "Closing  Date").  Irrespective  of the
actual time of  Closing,  the closing of the  transactions  with  respect to the
Merchants,  Merchant  Agreements  and  the  revenues  and  expenses  arising  in
connection  therewith shall be deemed to have taken place and shall be effective
as of the  Effective  Time and,  with  respect  to all other  matters,  shall be
effective as of 12:01 a.m. on the Closing Date.  Notwithstanding  the foregoing,
all representations, warranties and covenants (to be performed prior to Closing)
of the parties in this  Agreement  shall be measured  and  determined  as of the
Closing Date.

     2.02  Action of Company at  Closing.  At the  Closing,  the  Company  shall
deliver to Buyer the following:

          (a)  Bill of Sale in the  form  attached  hereto  as  Exhibit  2.02(a)
executed by a duly authorized officer of the Company (the "Bill of Sale");

          (b) Assignment and Assumption Agreement in the form attached hereto as
Exhibit  2.02(b)  executed  by a duly  authorized  officer of the  Company  (the
"Assignment and Assumption Agreement");

          (c) Consent to the assignment of the Processing  Agreement in the form
attached  hereto as Exhibit  2.02(c)  executed by a duly  authorized  officer of
Processor;

          (d) Consent to the assignment of the Sponsorship Agreement in the form
attached hereto as Exhibit 2.02(d) executed by a duly authorized  officer of the
Sponsor Bank;

          (e) Consents to the  assignment of all Assumed  Contracts set forth on
Schedule 5.05 hereto executed by the applicable third party;

          (f)  License  substantially  in the form  attached  hereto as  Exhibit
2.02(f) executed by all the members of Myisocenter.com, L.L.C.;

          (g) Non-Compete Agreements  substantially in the forms attached hereto
as Exhibit 2.02(g)  executed by the Company and Exhibit 2.02(h) executed by each
Controlling Shareholder and the persons set forth in Schedule 3.24;

          (h) Employment  Agreements  substantially in the forms attached hereto
as Exhibits 2.02(h)(i) and 2.02(h)(ii)  executed by Matthew B. Hyman and Zachary
A. Hyman (the "Employment Agreements");

          (i) An opinion from counsel to Company reasonably acceptable to Buyer;

          (j) copies of  resolutions  duly adopted by the Board of Directors and
shareholders of the Company authorizing and approving the Company's  performance
of the  transactions  contemplated  hereby and the execution and delivery of the
documents described herein, certified as true and of full force as of Closing by
appropriate officers of the Company;

          (k) a  certificate  of an  officer  of the  Company,  dated  as of the
Closing Date,  certifying  that (A) the  representations  and  warranties of the
Company and each Controlling  Shareholder made in this Agreement qualified as to
materiality  are true and  correct,  and  those  not so  qualified  are true and
correct in all  material  respects,  as of the date hereof and as of the time of
the  Closing  as  though  made  as of  such  time,  except  to the  extent  such
representations  and  warranties  expressly  relate to an earlier date

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<PAGE>

(in which case such  representations and warranties  qualified as to materiality
are true and  correct,  and those not so  qualified  are true and correct in all
material respects, on and as of such earlier date); and (B) the Company and each
Controlling  Shareholder  has duly  performed,  complied  with and satisfied all
covenants, agreements and conditions required by this Agreement to be performed,
complied with or satisfied by it by the time of the Closing;

          (l) a certificate of incumbency, dated as of the Closing Date, for the
officers of the Company  making  certifications  for Closing or  executing  this
Agreement,  the Assignment and Assumption Agreement,  Bill of Sale, or any other
Company Ancillary Document to be executed and delivered by the Company;

          (m)  certificate  of good standing for Company  issued by the State of
California, dated the most recent practical date prior to Closing;

          (n) all of the Assumed Contracts and Company books,  records and other
data relating to the Assets;

          (o) Escrow  Agreement in the form attached  hereto as Exhibit  2.02(o)
executed by a duly authorized  officer of the Company (the "Escrow  Agreement");
and

          (p) all executed agreements,  consents or other documents necessary to
transfer ownership and control of all bank, deposit,  escrow,  reserve,  demand,
investment or other accounts of the Company to the Buyer.

     Simultaneously with the delivery of the foregoing items,  Sellers will take
all such steps as may  reasonably be required to put Buyer in actual  possession
and operating control of the Assets.

     2.03 Action of Buyer at Closing. At the Closing, Buyer shall deliver to the
Company the following:

          (a) the Cash;

          (b) a certificate evidencing the Stock;

          (c) Intentionally Omitted.

          (d)  the  Assignment  and  Assumption  Agreement  executed  by a  duly
authorized officer of Buyer;

          (e) Intentionally Omitted.

          (f) Intentionally Omitted.

          (g) copies of  resolutions  duly adopted by the Board of Directors and
sole shareholder of Buyer authorizing and approving  Buyer's  performance of the
transactions contemplated hereby and the execution and delivery of the documents
described  herein,  certified  as  true  and of  full  force  as of  Closing  by
appropriate officers of Buyer;

          (h) copies of  resolutions  duly  adopted by the Board of Directors of
Holdings  authorizing and approving  Holdings'  performance of the  transactions
contemplated  hereby and the

                                       7
<PAGE>

execution and delivery of the documents described herein,  certified as true and
of full force as of Closing by appropriate officers of Holdings;

          (i) a certificate of an officer of the Buyer,  dated as of the Closing
Date,  certifying that (A) the  representations  and warranties of Buyer made in
this Agreement  qualified as to materiality are true and correct,  and those not
so  qualified  are true and  correct in all  material  respects,  as of the date
hereof and as of the time of the Closing as though made as of such time,  except
to the extent such representations and warranties expressly relate to an earlier
date  (in  which  case  such  representations  and  warranties  qualified  as to
materiality  are true and  correct,  and  those  not so  qualified  are true and
correct in all material respects, on and as of such earlier date); and (B) Buyer
has duly  performed,  complied with and satisfied all covenants,  agreements and
conditions  required  by  this  Agreement  to be  performed,  complied  with  or
satisfied by it by the time of the Closing;

          (j) a certificate  of an officer of Holdings,  dated as of the Closing
Date,  certifying  that a certificate of an officer of Holdings  certifying that
(A) the  representations  and  warranties  of  Holdings  made in this  Agreement
qualified as to materiality are true and correct, and those not so qualified are
true and correct in all material  respects,  as of the date hereof and as of the
time of the  Closing as though  made as of such time,  except to the extent such
representations  and  warranties  expressly  relate to an earlier date (in which
case such  representations  and warranties  qualified as to materiality are true
and  correct,  and those not so  qualified  are true and correct in all material
respects,  on and as of such earlier date); and (B) Holdings has duly performed,
complied with and satisfied all covenants, agreements and conditions required by
this Agreement to be performed,  complied with or satisfied by it by the time of
the Closing;

          (k) a certificate of incumbency, dated as of the Closing Date, for the
officers of Buyer making certifications for Closing or executing this Agreement,
Assignment and Assumption  Agreement or any other Buyer Ancillary Document to be
executed and delivered by Buyer;

          (l) a certificate of incumbency, dated as of the Closing Date, for the
officers  of  Holdings  making  certifications  for  Closing or  executing  this
Agreement or any other Holdings  Ancillary Document to be executed and delivered
by Holdings;

          (m) a  certificate  of  formation of Buyer from the State of Delaware,
dated the most recent practical date prior to Closing; and

          (n) a certificate of corporate existence of Holdings from the State of
Delaware, dated the most recent practical date prior to Closing.

                                   ARTICLE III
                  Representations and Warranties of the Sellers

     Each of the Controlling  Shareholders  and the Company hereby,  jointly and
severally,  represents  and warrants to both Buyer and Holdings as follows as of
the date of this Agreement and as of the Closing Date:

     3.01  Corporate  Organization;  Etc.  The  Company  is a  corporation  duly
organized,  validly existing and in good standing under the laws of the State of
California.  The Company has full corporate  power and authority to carry on the
Business as it is now being  conducted and to own the  properties  and assets it
now owns, including without limitation the Assets. The Company is duly qualified
to do

                                       8
<PAGE>

business  and is in good  standing  in the  jurisdictions  set forth in Schedule
3.01, which includes every  jurisdiction in which the failure to be so qualified
or in good standing would have a material  adverse effect on the Buyer's conduct
of the Business.

     3.02  Company's   Corporate   Powers;   Absence  of  Conflicts  With  Other
Agreements, etc.

                  (a)  The execution, delivery and performance by the
Company of this Agreement and the other agreements and transactions contemplated
hereby:

               (i)  are  within  the  Company's  corporate  powers,  are  not in
          contravention of the terms of the Company's Articles of Incorporation,
          Bylaws, or resolutions of the Board of Directors or shareholders,  and
          have been duly authorized by the Board of Directors of the Company, as
          and to the extent required by the Company's  Articles of Incorporation
          and applicable law; and

               (ii)  except  as  set  forth  on  Schedule  3.02,  (A)  will  not
          constitute a violation of any judgment,  decree, or order of any court
          of  competent  jurisdiction  applicable  to the  Company or any of the
          Assets,  (B)  will not  violate  any law,  rule or  regulation  of any
          governmental authority applicable to the Company or any of the Assets,
          (C) will not require any  consent,  approval or  authorization  of, or
          declaration,   filing  or  registration   with,  any  governmental  or
          regulatory authority,  (D) will not require notice to any governmental
          agency;  provided however, to the extent the transaction  contemplated
          herein requires notice to a governmental  agency,  such notice will be
          timely  given by Seller and (E) whether  with or without  notice,  the
          lapse of time or both, will not conflict with,  result in a breach of,
          constitute a default under,  result in the  acceleration of, create in
          any party the right to accelerate,  terminate,  modify,  or cancel, or
          require any notice  under any  agreement,  contract,  lease,  license,
          instrument, or other arrangement to which the Company is a party or by
          which it is bound or  create  any  lien,  security  interest,  charge,
          encumbrance or restriction on any of the Assets.

          (b) This Agreement has been duly and validly executed and delivered by
the Company and, as of the Closing, each of the Company Ancillary Documents will
have been duly and validly executed and delivered by the Company. This Agreement
constitutes,  and  upon  their  execution  and  delivery,  each  of the  Company
Ancillary Documents will constitute,  the valid, legal and binding obligation of
the Company, enforceable against it in accordance with their terms.

     3.03 Controlling  Shareholder's  Capacity;  Absence of Conflicts With Other
Agreements, etc.

          (a) The execution, delivery and performance by each of the Controlling
Shareholders  of  this  Agreement  and the  other  agreements  and  transactions
contemplated hereby:

               (i)  is  within  the  authority   and  legal   capacity  of  each
          Shareholder; and

                           (ii) except as set forth on Schedule 3.03, (A) will
                  not constitute a violation of any judgment, decree, or order
                  of any court of competent jurisdiction applicable to any
                  Controlling Shareholder, (B) will not violate any law, rule or
                  regulation of any governmental authority applicable to any
                  Controlling Shareholder, (C) will not require any consent,
                  approval or authorization of, or declaration, filing or
                  registration with, any governmental or regulatory authority,
                  (D) will not require notice to any governmental agency;
                  provided however, to the extent the transaction contemplated
                  herein requires notice to a governmental agency, such notice
                  will be timely given by the Sellers, and (E)

                                       9
<PAGE>

               whether with or without  notice,  the lapse of time or both, will
               not conflict  with,  result in a breach of,  constitute a default
               under,  result in the  acceleration  of,  create in any party the
               right to accelerate, terminate, modify, or cancel, or require any
               notice under any agreement, contract, lease, license, instrument,
               or other  arrangement to which any  Controlling  Shareholder is a
               party  or by  which it is bound  or  create  any  lien,  security
               interest,  charge,  encumbrance  or  restriction  on  any  of the
               Assets.

          (b) This Agreement has been duly and validly executed and delivered by
each  Controlling  Shareholder  and, as of the Closing,  each of the Shareholder
Ancillary  Documents  will have been duly and validly  executed and delivered by
each  Controlling  Shareholder.  This  Agreement  constitutes,  and  upon  their
execution  and  delivery,  each  of the  Shareholder  Ancillary  Documents  will
constitute,  the  valid,  legal  and  binding  obligation  of  each  Controlling
Shareholder, enforceable against it in accordance with their terms.

     3.04 Title to Assets. Except for the Intellectual Property and as set forth
on Schedule 3.04, the Company has good, valid and marketable title to all of the
Assets  owned by the  Company,  free and clear of any  liens,  pledges,  claims,
charges, rights of first refusals, security interests, encumbrances or rights of
other parties;  and the Company has a good and valid leasehold  estate in all of
the Assets  leased by it; and the Company has a good and valid  license or right
to use all of the Assets  otherwise  used by the Company in connection  with the
Business.

     (a) The Assets  constitute all of the assets  necessary or appropriate  for
the  continued  operation of the Business by the Buyer after Closing in the same
fashion as the Company is currently operating the Business.

     3.05  Capitalization.  As of the  date  hereof,  the  Company's  authorized
capital stock consists of 500,000  shares of common stock,  and no par value per
share,  123,907  shares of which are issued an  outstanding.  There are no other
classes of securities of the Company  outstanding.  Each  shareholder  and their
respective state of residency is set forth on Schedule 3.05.

     3.06  Company's  Subsidiaries.  Except as set forth on Schedule  3.06,  the
Company does not own,  directly or indirectly,  beneficially  or equitably,  any
capital  stock  or  other  equity,  ownership  or  proprietary  interest  in any
corporation,  partnership,  limited liability company, association, trust, joint
venture or other entity.

     3.07  Financial  Statements.  Attached  hereto  as  Schedule  3.07  are the
following  financial  statements  ---------------------   -------------  of  the
Company (collectively, the "Financial Statements"):

          (a) the  Company's  unaudited  balance  sheet dated as of December 31,
     2002;

          (b) the  Company's  unaudited  Statement of Income for the twelve (12)
     months ended December 31, 2002;

          (c) the Company's  unaudited  balance  sheets dated as of May 31, 2003
     and June 30, 2003;

          (d) the  Company's  unaudited  Statement of Income for each of the six
     (6) months ended June 30, 2003.

The  Financial  Statements  have been prepared from the books and records of the
Company  which  accurately  and fairly  reflect  in all  material  respects  the
transactions  with respect to the  Business.  As

                                       10
<PAGE>

qualified by Seller in Schedule 3.07(e), the Financial Statements fairly present
the financial  condition,  the results of operations and changes in cash flow of
the Company at the  respective  dates of and for the periods  referred to in the
Financial  Statements,  all in accordance with GAAP,  except for the omission of
disclosures  and the  statement  of cash  flows  subject  in the case of interim
financial statements,  to normal year end adjustments,  the effect of which will
not,  individually or in the aggregate,  be material.  Except as provided in the
preceding sentence,  the Financial Statements reflect the consistent application
of GAAP throughout the periods involved and no financial statements of any other
entity are required by GAAP to be included in the  financial  statements  of the
Company. The Financial  Statements  accurately reflect or adequately provide for
all claims  against,  and all debts and  liabilities  of, the Company,  fixed or
contingent, existing at the dates thereof. The Company has adequately funded all
accrued  employee  benefit  costs and such funding is reflected on the Financial
Statements.

     3.08  Undisclosed  Liabilities.  Except as otherwise  set forth on Schedule
3.08 or as reflected in the most recent Financial  Statements,  the Company does
not  have  any  material  liabilities  or  obligations  of any  nature,  whether
absolute,  accrued,  asserted or unasserted,  contingent or otherwise or whether
due or to become due,  and neither the Company nor any  Controlling  Shareholder
knows or has reason to know of any basis for the  assertion  against the Company
of any such liability or obligation of any nature not described in Schedule 3.08
or in the Financial Statements.  The company has paid or satisfied all financial
liabilities and obligations when due in the ordinary course. For the purposes of
materiality  in this Section  3.08,  materiality  shall mean  anything  totaling
$2,000 individually and $15,000 in the aggregate.

     3.09  Post-Balance  Sheet  Results.  Except as set forth on Schedule  3.09,
since December 31, 2002, with respect to the Business, there has not been:

          (a)  any  damage,  destruction  or loss  (whether  or not  covered  by
insurance),  the  occurrence  of which  could  reasonably  be expected to have a
material adverse effect on the Assets or Business;

          (b) any sale,  lease,  transfer or  disposition  by the Company of the
Assets except sales, leases,  transfers or dispositions of non-material portions
of the Assets or use of supplies or inventory with  replacements  thereof in the
ordinary course of the Company's business; or

          (c) any change or the occurrence of any fact or condition which may be
reasonably expected to have a material adverse effect (as defined herein) on the
Company's operations, prospects, Business, or the value of the Assets other than
such changes, facts and conditions, if any, affecting the general economy or the
electronic payment industry generally.

For the purposes of Section 3.09, a material  adverse effect shall be any change
or loss involving an amount in excess of $10,000.

          3.10 Merchant Accounts  Settlement  Report. The most recent Settlement
Report issued by the Sponsor Banks is attached hereto as Schedule 3.10(a). Since
the date of the  Settlement  Report,  there  has not been any  material  adverse
change in the value  and/or the cash flow of the  Merchant  accounts  taken as a
whole. To the Knowledge of Sellers,  no Merchant that had  transactions,  in the
aggregate,  with an annual  volume in excess of One Hundred  Thousand and No/100
Dollars ($100,000.00) as reflected on the Settlement Report intends to cancel or
terminate its Merchant Account or business with the Company, whether as a result
of the  consummation  of the  transactions  contemplated  by this  Agreement  or
otherwise  and,  to the  Knowledge  of  Sellers,  no such  Merchant  intends  to
materially change its transaction  volume following Closing or will not continue
such  relationship  with  Buyer  after the  Closing.  The  Settlement  Report is
representative  of a month  during  which  the  Business  was  conducted  in the
ordinary course.  Schedule 3.10(b) sets forth for each Merchant (i) its name and
address;  (ii) its  current  year-to-date  sales;

                                       11
<PAGE>

and (iii) the discount rate contracted.  Schedule 3.10(c) lists, per merchant as
of June 30,  2003,  the  merchant  reserve  accounts  maintained  by each of the
Merchants pursuant to the applicable Merchant Agreement.

     3.11 Tax Matters.

          (a) Except as noted in Schedule 3.11(a), the Company has filed all Tax
Returns  required  by law to be filed by it and has paid all Taxes,  assessments
and other governmental  charges shown thereon as due and payable, the failure of
which to be filed or paid could adversely affect Buyer or Holdings,  result in a
lien on the  Assets,  or could  impose upon Buyer or  Holdings  any  transferees
liability for any Taxes due other than those  presently  payable without penalty
or interest or those being contested in good faith by appropriate procedures and
not material in amount.  All of such Tax Returns have been prepared and filed in
accordance with applicable laws and regulations. Each such Tax Return is true in
all material respects, accurate and complete.

          (b) The Company has withheld all required  amounts from its employees,
agents and  contractors  and remitted  such  amounts to the proper  governmental
authorities;  paid all  employer  contributions  and  premiums;  and  filed  all
federal,  state,  local and foreign Tax  Returns  and  reports  with  respect to
employee income Tax withholding,  and social security and unemployment Taxes and
premiums,  all in  compliance  with the  withholding  provisions of the Code and
other applicable laws.

          (c) There are no liens for Taxes on any of the Assets,  except for any
lien for Taxes not yet due.

          (d) Except as  disclosed in Schedule  3.11(a),  there is no dispute or
claim  concerning  any Tax liability of the Company either (i) claimed or raised
by any  authority  in  writing  or  (ii)  as to  which  any  of the  Controlling
Shareholders  or any of the  directors and officers of the Company has Knowledge
based upon personal contact with any agent of such authority.

          (e) To the  Knowledge  of  Sellers  and  except  as noted in  Schedule
3.11(a),  the Company has not waived any  statute of  limitations  in respect of
Taxes or agreed to any  extension  of time with respect to a Tax  assessment  or
deficiency.

          (f) The Company is, and has been at all times during its existence, an
"S"  corporation  within the  meaning of  Section  1361(a) of the Code.  A valid
election  under Section 1362 of the Code (and a comparable  election under state
or local law in each  jurisdiction  where the  Company is  required  to file Tax
Returns that  provides for such an election)  has been in effect with respect to
the Company at all times during its existence.

          (g) The Company is not a party to any joint  venture,  partnership  or
other  arrangement that could be treated as a partnership for federal income Tax
purposes.

     3.12 Contracts.  Except for the Assumed Contracts or as otherwise set forth
on Schedule 3.12(a) hereto, the Company is not a party or subject to any written
or express agreement,  contract, or obligation,  regardless of materiality,  nor
any material oral or implied agreement,  contract or obligation (materiality for
purposes  of this  Section  3.12 is defined as that  valued at $30,000 or more),
including without limitation:

               (i)  any  Independent  Service  Organization   agreement  or  any
     Independent Training Organization Agreement;

                                       12
<PAGE>

               (ii) any agreements with authorization network vendors;

               (iii) any agreement  with a processing  bank or other entity that
     processes credit card or other transactions on behalf of or for the benefit
     of the Company;

               (iv) any agreement that limits the right of the Company to engage
     in or to compete with any person in any business;

               (v) for the lease of any tangible or intangible property;

               (vi) not in the ordinary course of business;

               (vii) for the  purchase  or sale of any  equipment,  supplies  or
     services  with a  value  in  excess  of Ten  Thousand  and  No/100  Dollars
     ($10,000.00);

               (viii) for any power of attorney; and

               (ix) otherwise  material to the Assets,  Business or operation of
     the Company.

Except as noted in Schedule  3.12(b),  each of the material Assumed Contracts is
in full force and effect; each is a legal, valid and binding contract; there has
been no threatened  cancellation  thereof and there are no outstanding  disputes
thereunder;  each is with  unrelated  third  parties and was entered  into on an
arms-length  basis in the ordinary  course of business;  all will continue to be
binding in accordance with their terms after  consummation  of the  transactions
contemplated  herein  including  obtaining  the consents  specified in Article V
hereof;  there is no  material  default (or an event  which,  with the giving of
notice or lapse of time or both would be a  material  default)  by the  Company;
and, to the Knowledge of the Company and the Controlling Shareholders,  there is
no pending or  threatened,  bankruptcy,  insolvency or similar  proceeding  with
respect to any other party to the Assumed Contracts.

     3.13 Intellectual Property.

     (a) Schedule 1.01(c) sets forth all the patents,  trademarks,  trade names,
service marks,  trade secrets,  copyrights,  service marks and other proprietary
intellectual  property rights and licenses that are owned or used by the Company
or are material to the Business.  All Owned  Intellectual  Property (i) has been
duly maintained  (including the proper,  sufficient and timely submission of all
necessary filings and fees), (ii) has not lapsed, expired or been abandoned, and
(iii) to the  knowledge  of Company and except as noted on Schedule  3.04 is not
the subject of any opposition,  interference,  cancellation or other  proceeding
before any governmental registration or other authority in any jurisdiction.  To
the  Knowledge  of  Sellers,  and  except  as  provided  in  Schedule  3.04,  no
infringement  exists by the Company on the  intellectual  property rights of any
other  person or  entity  that  results  in any way from the  operations  of the
Business.  To the Knowledge of Sellers, and except as provided in Schedule 3.04,
there is no  infringing  use of any of the Owned  Intellectual  Property  by any
other person or entity.

     (b)  Except  as set forth in  Schedule  3.04 the  Company  has the right to
assign  to the Buyer  all of the  intellectual  property  used  pursuant  to the
License Agreements.

     (c) Except as set forth on Schedules  3.04 and 1.01(c),  the Buyer will own
or be  able  to use  the  Intellectual  Property  on  the  identical  terms  and
conditions  as the Company  owned or used such items prior to the Closing  Date,
including without limitation,  the Tradename,  all computer software used in the
Business  and all  derivative  works  thereof  developed  by the Company and its
employees.

                                       13
<PAGE>

     3.14 Employees.

          (a) Schedule 3.14(a) contains a list of all of the Company's employees
and  independent  sales  representatives,  their  current  salary or wage rates,
department  and a job title or other  summary  of the  responsibilities  of such
employees as well as a designation of those  employees who are the key employees
of the  Company.  Since  December 31,  2002,  except in the  ordinary  course of
business  consistent with past practice,  there has not been any increase in the
compensation payable or to become payable by the Company to any of the Company's
officers,  employees or agents,  or any bonus payment or arrangement  made to or
with any such person, except as described in Schedule 3.14(a).

          (b) The Company has not incurred any liability,  or taken or failed to
take any action which will result in any liability, in respect of any failure to
comply with the Fair Labor Standards Act or any other applicable law relating to
minimum  wages or maximum hours for  employees,  equal  opportunity,  collective
bargaining or workers' compensation  insurance.  To the Knowledge of Sellers and
except as set forth on Schedule 3.14(b)(i), the Company has not entered into any
written or verbal agreements with the Company's employees.  Schedule 3.14(b)(ii)
includes  a list  of  all  employees  of  the  Company  (other  than  "part-time
employees") who have been "terminated" or "laid-off" since December 31, 2002 (as
such  quoted  terms  are  defined  in  the  Worker   Adjustment  and  Retraining
Notification Act).

          (c) Except as noted in Schedule 3.14(c),  to the Knowledge of Sellers,
no independent  sales  representative  of the Company that received in excess of
Five  Thousand  and  No/100   Dollars   ($5,000.00)  as  payment  of  residuals,
commissions,  or any other compensation during the calendar year 2002 intends to
cancel or terminate its  relationship  with the Company prior to Closing or will
not continue such relationship with Buyer after the Closing, whether as a result
of the  consummation  of the  transactions  contemplated  by this  Agreement  or
otherwise.

          (d) An  accurate  and  complete  Form  I-9 for  each of the  Company's
employees  has been  completed,  reviewed  and  maintained  by the  Company on a
current basis.  The Company has provided Buyer with a complete copy of each such
Form I-9. All of the  Company's  employees  have the  necessary and proper legal
authorization to be employed by the Company.

     3.15 Labor  Matters.  The Company has no collective  bargaining  agreements
with any labor union and there are no current  negotiations  with a labor union.
The Company is in compliance in all material  respects with all applicable  laws
respecting  employment  and  employment  practices,   terms  and  conditions  of
employment and wages and hours, and is not engaged in any unfair labor practice.
There is no unfair labor practice  complaint  against the Company pending before
the National Labor Relations Board. There is no labor strike, dispute,  slowdown
or stoppage actually pending or threatened against or affecting the Company.  No
grievance  which might have an adverse  effect on the Company or Business or any
such  arbitration  proceeding  arising  out of or  under  collective  bargaining
agreements  is  pending  and no  claim  therefor  exists.  The  Company  has not
experienced any employee strike.

     3.16 Employee and Labor Matters; Employee Benefit Plans.

     (a) Schedule  3.16 sets forth a complete and correct list (all of which are
collectively  referred  to as the  "Employee  Benefit  Plans") of all  "employee
benefit  plans,"  as defined in Section  3(3) of ERISA,  all  "specified  fringe
benefit  plans" as defined in Section  6039D of the Code,  and all other  bonus,
incentive  compensation,  deferred  compensation,  profit sharing, stock option,
severance, supplemental unemployment,  layoff, salary continuation,  retirement,
pension, health, life insurance, disability, group insurance, vacation, holiday,
sick leave, fringe benefit or welfare plan or employment,  consulting, change in
control,  independent  contractor,  professional  services,  confidentiality  or
non-competition  agreement  or any  other  similar  plan,  agreement,  policy or
understanding  (whether  oral or written,  qualified or  non-

                                       14
<PAGE>

qualified) and any trust,  escrow or other funding  arrangement related thereto,
(i) which is currently or has been at any time  maintained or  contributed to by
the  Company,  or (ii) with  respect to which the Company has any  liability  or
obligations to any current or former officer,  Employee,  or service provider of
the Company or any ERISA Affiliate, or the dependents of any thereof, regardless
of whether funded, or (iii) which could result in the imposition of liability or
any obligation of any kind or nature,  whether  accrued,  absolute,  contingent,
direct,  indirect,  known or unknown,  perfected  or inchoate or  otherwise  and
whether or not now due or to become due, to the Company or an ERISA Affiliate.

          (b) The  Company and its ERISA  Affiliates  have never  maintained  or
contributed to any plan subject to Section 412 of the Code, Section 302 of ERISA
or Title IV of ERISA.

          (c) There have been no prohibited transactions,  breaches of fiduciary
duty or other  breaches or  violations  of any law  applicable  to the  Employee
Benefit Plans and related funding arrangements that could subject the Company to
any liability. Each Employee Benefit Plan intended to be qualified under Section
401(a) of the Code has a current favorable determination letter (or, in the case
of a  standardized  form or paired  plan,  a favorable  opinion or  notification
letter),  and no event has occurred which could cause any Employee  Benefit Plan
to become disqualified for purposes of Section 401(a) of the Code. Each Employee
Benefit Plan has been  operated in compliance  with  applicable  law,  including
Section 401(a) of the Code and ERISA, as applicable,  and in accordance with its
terms.

          (d) All required reports, tax returns, documents and plan descriptions
of the Employee  Benefit Plans have been timely filed with the IRS, DOL and PBGC
and/or, as appropriate, provided to participants in the Employee Benefit Plans.

          (e) No written or oral  representations have been made to any Employee
or former Employee of the Company promising or guaranteeing any employer payment
or funding,  and no Employee  Benefit Plans  provide,  for the  continuation  of
medical,  dental, life or disability  insurance coverage for any former Employee
of the Company  for any period of time  beyond the end of the current  plan year
(except to the extent of coverage required under COBRA). The consummation of the
transactions  contemplated  by this  Agreement  will not  accelerate the time of
vesting,  of payment,  or increase the amount,  of compensation to any Employee,
officer,  former Employee or former officer of the Company.  No Employee Benefit
Plans or other  contracts or  arrangements  provide for  payments  that would be
triggered by the consummation of the transactions contemplated by this Agreement
that  would  subject  any person to excise  tax under  Section  4999 of the Code
(i.e.,  "golden parachute" taxes). All compensation  amounts that have been paid
or are payable are or will become  deductible by the Company pursuant to Section
162 of the Code.

          (f) The  Company  and its  ERISA  Affiliates  have  complied  with the
continuation  coverage provisions of COBRA with respect to all current Employees
and former Employees.

          (g) Neither the Company,  any ERISA  Affiliate nor any other  employer
who has  participated or is participating in any employer plan (a "Sponsor") has
incurred any liability to the DOL, the PBGC or the IRS in connection with any of
the Employee  Benefit Plans, and no condition exists that presents a risk to the
Company or any Sponsor of  incurring  any  liability to the DOL, the PBGC or the
IRS.  There are no pending,  or to the  Knowledge of the Company,  threatened or
anticipated claims, lawsuits or actions relating to, by, on behalf of or against
any Employee Benefit Plan (other than routine claims for benefits).

          (h) The Company has paid in full all amounts which are required  under
the terms of each Employee Benefit Plan to have been paid as of the date of this
Agreement.  As of the  Closing  Date,  the  Company  shall have paid in full all
liabilities  accrued  with respect to each  Employee or former  Employee in each
Employee Benefit Plan.

                                       15
<PAGE>

          (i)  All  amounts   required  under  any  Employee   Benefit  Plan  or
arrangement that provides for severance payments to Employees will be paid on or
prior to the completion of the transactions contemplated herein.

          (j) For  purposes of this  Section  3.16,  the term "ERISA  Affiliate"
shall mean (i) any related  company or trade or business  that is required to be
aggregated  with the Company under Code Sections  414(b),  (c), (m) or (o); (ii)
any other  company,  entity or trade or  business  that has  adopted or has ever
participated  in any  Employee  Benefit  Plan;  and  (iii)  any  predecessor  or
successor company or trade or business of the Company or any entity described in
Section 3.16 (j)(i) and 3.16 (j)(ii).

          (k) For purposes of this Section 3.16,  the term  "Employee"  shall be
considered to include individuals  rendering personal services to the Company as
independent  contractors and leased  employees as defined in Code Section 414(n)
and the regulations promulgated pursuant thereto.

          (l) Schedule 3.16(l) hereto sets forth the Company's obligation to its
employees with respect to all compensation,  vacation, paid time off, sick leave
and holiday benefits.

          (m) Schedule 3.16 (m) hereto sets forth the Company's obligations,  on
an individual basis, to former employees who have elected COBRA coverage.

     3.17  Litigation.  Except as otherwise set forth on Schedule 3.17, there is
no litigation,  arbitration,  governmental  claim,  investigation or proceeding,
whether related to a Credit Card Company or otherwise, proceeding pending or, to
the  Knowledge  of Sellers,  threatened  against the Company at law or in equity
before any court or other governmental  agency or before any applicable agent of
a Credit Card Company. Except as otherwise set forth on Schedule 3.17, there are
no pending,  or to the Knowledge of Sellers,  threatened  claims,  litigation or
other action  relating to any Employee  Benefit Plan (other than ordinary course
claims for benefits). No such proceeding set forth on Schedule 3.17 prohibits or
adversely affects the transactions contemplated hereby or the ownership or other
rights with respect to the Assets.

     3.18  Compliance.  Except as noted in  Schedule  3.18,  the  Company  is in
compliance in all material respects with all applicable local, state and federal
laws,  ordinances,  regulations,  court or administrative orders or decrees. The
Company  is in  full  compliance  with  all  of the  rules  and  regulations  of
applicable Credit Card Companies.  Except as noted in Schedule 3.18, the Company
has obtained,  and kept in current, all required licenses and consents to engage
in the  Business.  To the  Knowledge  of the  Company,  and  except  as noted in
Schedule  3.18,  there  have  been no past and  there  are no  current  material
investigations,  proceedings,  claims,  actions,  suits, demands or notices with
respect to past or current business conduct or practices of the Company.

     3.19 Environmental  Matters.  To the Knowledge of the Company and except as
otherwise set forth on Schedule 3.19, during the term of Company's  occupancy of
the offices  leased by the  Company,  the Company has  complied in all  material
respects with all applicable federal,  state,  local, and foreign  environmental
laws relating to pollution or the protection of human health and the environment
and the requirements of any permits,  licenses,  or authorizations  issued under
such environmental laws with respect to any Real Property.

     3.20 Certain Payments.  To the Knowledge of the Company,  and except as set
forth on Schedule 3.20, neither the Company, any Controlling Shareholder nor any
equity owner, director, officer, agent, or employee of the Company, or any other
person  associated with or acting for or on behalf of the Company,  has directly
or indirectly (i) made any illegal  contribution,  gift, bribe, rebate,  payoff,
influence payment,  kickback or other payment to any person,  private or public,
regardless  of form,  whether  in

                                       16
<PAGE>

money,  property,  or services  (A) to obtain  favorable  treatment  in securing
business, (B) to pay for favorable treatment for business secured, (C) to obtain
special  concessions  or for special  concessions  already  obtained,  for or in
respect of the Business or any affiliate of the Company,  or (D) in violation of
any law, or (ii)  established  or maintained any fund or asset that has not been
recorded in the books and records of the Company.

     3.21 No Conflict of Interest.  Neither of the shareholders nor any of their
affiliates  owns,   directly  or  indirectly   (except  in  the  capacity  as  a
shareholder),  in whole or in part, any real or personal  property,  tangible or
intangible,  which the Company is now using or the use of which is necessary for
the  Business.  Except as set forth in Schedule  3.21,  no officer,  director or
shareholder  of the Company,  or any person in the family of or who is a partner
of any officer,  director or shareholder of the Company,  (i) is indebted to the
Company, or (ii) has any direct or indirect ownership interest in (A) any entity
that sells goods or services to the Company, (B) any other entity with which the
Company has a business  relationship or (C) in any entity that competes with the
Company.

     3.22 Investment.

     (a) The Company and,  indirectly,  each of the  shareholders of the Company
(the "CPS Shareholders"),  are acquiring the Stock for their own account and not
with a view to the distribution thereof within the meaning of the 1933 Act.

     (b) The  Company  and the  CPS  Shareholders,  are  not  relying  upon  any
representation or warranty of Buyer, Holdings, any of their respective officers,
directors,  employees, agents,  representatives or affiliates,  except for those
representations and warranties set forth in this Agreement, any other agreements
contemplated  hereby,  the  Schedules  hereto  and such  certificates  and other
instruments required to be delivered pursuant to the terms hereof.

     (c) The  Company  and the CPS  Shareholders,  except  for  those  listed on
Schedule 3.22(c), are "accredited investors" under Regulation D ("Regulation D")
promulgated  under  the  Securities  Act and  each  meets  at  least  one of the
following qualifications:  (i) any natural person whose individual net worth, or
joint net worth with that person's  spouse,  at the time of the purchase exceeds
$1,000,000;  (ii) any natural  person who had an individual  income in excess of
$200,000 in each of the two most recent years or joint income with that person's
spouse in excess of $300,000 in each of those years and who  reasonably  expects
to reach  the same  income  level in the  current  year;  or, in the case of the
Company  and  the  CPS  Shareholders,  (iii)  one of the  other  definitions  of
"accredited investors" described in paragraphs (1), (2), (3), (4), (7) or (8) of
Rule 501(a) of Regulation D.

     (d) Those listed on Schedule 3.22(c), either individually,  or with his/her
purchaser representative(s), as defined in Rule 501(h) of Regulation D, has such
knowledge and experience in financial and business matters that he is capable of
evaluating the merits and risks of the prospective investment; provided however,
that in no  event  shall  the  number  of  shareholders  that  fall  under  this
subsection (d) exceed 35.

     (e) Additionally,  the Company and the CPS Shareholders  represent that (i)
each can bear the economic  risk of losing their entire  investment;  (ii) their
overall  commitment  to  investments  that  are not  readily  marketable  is not
disproportionate  to their net worth, and their investment in the Stock will not
cause such overall  commitment to become  excessive;  (iii) each has substantial
experience in making  investment  decisions of this type or are relying on their
own tax  advisor  and a  purchaser  representative  in  making  this  investment
decision;  and (iv)  the  objectives  of  Holdings  are  compatible  with  their
investment goals.

                                       17
<PAGE>

     (f) The Company and the CPS  Shareholders  are aware that as of the Closing
Date, the Stock will not have been registered  under the 1933 Act or any state's
securities   laws.  Each  Seller  further   understands  that  the  certificates
representing  the Stock will  include an  appropriate  legend to the effect that
such  securities  have not been  registered  under  the 1933 Act or any  state's
securities laws and that such  securities may not be sold or transferred  except
in compliance with the 1933 Act and applicable state securities laws.

     (g) The Company and the Shareholders know and understand that the Stock has
not been registered under the 1933 Act by reason of specified exemption from the
registration  provisions of the 1933 Act which depends upon, among other things,
the bona fide nature of each Seller's investment intent as expressed herein.

     (h) The Company and the CPS Shareholders know and understand that the Stock
must be held indefinitely unless  subsequently  registered under the 1933 Act or
an  exemption  from such  registration  is  available.  The  Company and the CPS
Shareholders  have  been  advised  or are  aware of the  provisions  of Rule 144
promulgated under the 1933 Act, which permits limited resale of shares purchased
in a private  placement  subject to the  satisfaction of certain  conditions and
that such rule may not become available for resale of the Stock.

     (i) The Company and the CPS Shareholders know and understand that they have
been given access to full and complete information regarding Buyer and Holdings,
have had the  opportunity to meet with officers of Buyer and Holdings,  have had
the opportunity to review all documents  requested by such Seller in writing and
have  utilized  such  access and  opportunity  to its own  satisfaction  for the
purpose of obtaining such information. The Company and the CPS Shareholders have
been  given  the  opportunity  to attend a meeting  with  officers  of Buyer and
Holdings for the purpose of asking  questions  of, and  receiving  answers from,
such representatives  concerning the business of Buyer and Holdings, the capital
structure  of  Holdings  and such  other  additional  information  as each deems
necessary to make an informed  investment  decision relating to the Stock and to
verify the accuracy of such information.

     3.23 Disclosure.  No  representation or warranty made herein by the Company
or any Controlling Shareholder, nor in any statement,  certificate or instrument
to be  furnished  to the Buyer or  Holdings  by the  Company or any  Controlling
Shareholder pursuant to any Company Ancillary Document or Shareholder  Ancillary
Document  contains or will contain any untrue  statement  of a material  fact or
omits or will omit to state any  material  fact  necessary  in order to make the
statements and information contained herein or therein not misleading.

     3.24  Myisocenter.com,  LLC. Set forth on Schedule 3.24 are all the members
and employees of Myisocenter.com, L.L.C.

     3.25 Attrition Rate.

     (a) The monthly attrition rate of the Company's  Merchants between December
31, 2002 and the date of this agreement has not exceeded 3%.

     (b) The Sellers  have no reason to expect,  nor are they aware of any facts
or circumstances  existing or reasonably anticipated to occur in the future that
would cause the Attrition Rate to, as a percentage of gross revenue,  exceed the
historical levels described in Section 3.25(a).

     (c) except as noted in Schedule  3.25(c),  to the Knowledge of Sellers,  no
employees of the Company nor any of the active Merchants have in the past or are
presently engaging in fraud in relation to the Business.

                                       18
<PAGE>

     3.26 Real Property.  At no time has the Company had any ownership interest,
directly or indirectly, in any real property

     3.27 Chargebacks.

     (a) Schedule 3.27(a) hereto sets forth the Chargeback experience related to
the Business of the Sellers for the past six months;

     (b) The  Sellers  do not know of any  facts  or  circumstances  that  would
indicate that the  Chargebacks  will exceed the historical  levels  described in
Schedule 3.27(a); and

     (d) The Company has handled and processed all  Chargebacks  in the ordinary
course consistent with the rules of the Card Associations.

     3.28 Leasing Losses.

     (a) The  Losses  of the  Company  arising  or  related  to its  leasing  of
equipment  during the period from December 31, 2002 and the Effective Time, have
not exceeded $10,000 in the aggregate.

     (b) The  Sellers  have no reason to expect,  nor are they aware of facts or
circumstances  existing or reasonably  anticipated to occur in the future,  that
Losses  relating to or arising out of the  Company's  leasing  activities  would
exceed historical levels.

     3.29  Franchise  Issues.  To the  Sellers'  Knowledge,  the Company and its
Subsidiaries  are in material  compliance  with all federal and state  statutes,
rules,  regulations  and  guidelines,  if  applicable,  regarding  the  offer of
franchises or business opportunities.

     3.30  Ownership and  Portability of Merchant  Accounts.  Except as noted in
Schedule  3.30,  the Company  owns all Merchant  Accounts  free and clear of all
encumbrances, other than liens provided for in the Sponsorship Agreement. To the
Company's  knowledge all such Merchant  Accounts are processed under unique BINS
and  ICAs.  Except as noted in  Schedule  3.30 and  subject  to the terms of the
Processing Agreement and Sponsorship  Agreement,  the Company has the ability to
assign the Merchant Contracts relating to the Merchants so identified, including
all Merchant files and records (paper and fiche),  related  merchant reserve and
hold accounts.

     3.31 Employees and Independent Contractors.

     (a) Set forth on Schedule 3.14 is a true, complete and correct list setting
forth as of the date  hereof (a) the names,  location  of  services  and current
compensation of all individuals currently employed directly or indirectly by the
Company  on a  salaried  or hourly  basis,  and (b) the  names and total  annual
compensation  for all  independent  contractors  (other than vendors and similar
professionals)  who render  services on a regular  basis to the Company for whom
the  Company  prepared  an IRS Form 1099 for  fiscal  year 2002 and whose  total
annual compensation is in excess of $10,000.

     (b) To the Company's Knowledge, all  non-employee/independent  persons that
solicit  Merchants  for or on behalf of the Company  have,  at all times  during
their  relationship  with the Company,  been properly  classified as independent
contractors and not employees of the Company for purposes of federal,  state and
local employment tax purposes.

     (c) Set forth in Schedule 3.31 is a true, complete and correct list setting
forth as of the date hereof the names of all employees,  agents and  independent
contractors of the Company and its

                                       19
<PAGE>

Subsidiaries  and the  amount of all  retention  payments,  severance  payments,
change in control  payments or other similar  compensation or benefits which are
or may become payable in connection with the  consummation  of the  transactions
contemplated by this Agreement.  The Company and its Subsidiaries  have taken no
actions  prior to the Closing  related to the  foregoing  that will  subject it,
Holdings or any of its  Subsidiaries  to liability  after the Closing other than
payment of the foregoing by the Company and its Subsidiaries.

     3.32  Dissenters'  Rights.  The  Company  has  received  no  notice  from a
stockholder  that such  stockholder  will seek to exercise his or her  statutory
appraisal rights under the laws of California. No shareholder of the Company has
a legal right to exercise his or her appraisal rights after the Closing Date.

     3.33 Independent Agent Contracts.  Each of the Company's sales agents are a
party  to  written  agreements  which  do not  differ  materially  from the form
attached hereto as Exhibit 1.01(t), except as noted on Schedule 3.33.

                                   ARTICLE IV
              REPRESENTATIONS AND WARRANTIES OF BUYER AND HOLDINGS

     Each of Buyer and Holdings  hereby,  jointly and severally,  represents and
warrants to the Company and each  Controlling  Shareholder  as follows as of the
date of this Agreement and as of the Closing Date:

     4.01 Corporate Organization;  Etc. Buyer is a limited liability company and
Holdings is a corporation,  both duly  organized,  validly  existing and in good
standing  under  the laws of the  States  of  Delaware.  Each of the  Buyer  and
Holdings  has full power and  authority  to carry on its  business  as it is now
being  conducted and to own the properties  and assets it now owns.  Each of the
Buyer and Holdings is duly  qualified to do business and is in good  standing in
the  jurisdictions set forth in Schedule 4.01, except where the failure to be so
qualified  or in good  standing  would  have a  material  adverse  effect on the
Buyer's or Holdings' business, as applicable or the results of operations of the
Buyer or Holdings, as applicable.

     4.02 Buyer's Corporate Powers;  Absence of Conflicts With Other Agreements,
etc.

          (a) The  execution,  delivery  and  performance  by the  Buyer of this
Agreement and the other agreements and transactions contemplated hereby:

               (i) are within the Buyer's powers,  are not in  contravention  of
          the terms of the Buyer's  Certificate of Formation,  Limited Liability
          Company  Agreement,  or resolutions of the Board of Representatives or
          interestholders  of Buyer,  and have been duly authorized by the Board
          of  Representatives of the Buyer, as and to the extent required by the
          Buyer's Limited Liability Company Agreement and applicable law; and

               (ii)  except  as  set  forth  on  Schedule  4.02,  (A)  will  not
          constitute a violation of any judgment,  decree, or order of any court
          of  competent  jurisdiction  applicable  to the  Buyer,  (B)  will not
          violate any law,  rule or  regulation  of any  governmental  authority
          applicable to the Buyer, (C) will not require any consent, approval or
          authorization of, or notice to, or declaration, filing or registration
          with, any governmental or regulatory  authority,  and (D) whether with
          or without notice,  the lapse of time or both, will not conflict with,
          result  in a breach  of,  constitute  a default  under,  result in the
          acceleration  of,  create  in  any  party  the  right  to  accelerate,
          terminate,  modify,  or  cancel,  or  require  any

                                       20
<PAGE>

          notice under any agreement,  contract, lease, license,  instrument, or
          other  arrangement  to  which  the  Buyer is a party or by which it is
          bound.

          (b) This Agreement has been duly and validly executed and
delivered by the Buyer and, as of the Closing, each of the Buyer Ancillary
Documents will have been duly and validly executed and delivered by the Buyer.
This Agreement constitutes, and upon their execution and delivery, each of the
Buyer Ancillary Documents will constitute, the valid, legal and binding
obligation of the Buyer, enforceable against it in accordance with their terms.

     4.03  Holdings'   Corporate   Powers;   Absence  of  Conflicts  With  Other
Agreements, etc.

          (a) The  execution,  delivery  and  performance  by  Holdings  of this
Agreement and the other agreements and transactions contemplated hereby:

               (i)  are  within   Holdings'   corporate   powers,   are  not  in
          contravention of the terms of Holdings'  Certificate of Incorporation,
          Bylaws,  or resolutions of the Board of Directors or  shareholders  of
          Holdings,  and have been duly  authorized by the Board of Directors of
          Holdings,  as and to the extent required by the Holdings'  Certificate
          of Incorporation and applicable law; and

               (ii)  except  as  set  forth  on  Schedule  4.03,  (A)  will  not
          constitute a violation of any judgment,  decree, or order of any court
          of competent jurisdiction applicable to Holdings, (B) will not violate
          any law, rule or regulation of any governmental  authority  applicable
          to  Holdings,   (C)  will  not  require  any   consent,   approval  or
          authorization of, or notice to, or declaration, filing or registration
          with, any governmental or regulatory  authority,  and (D) whether with
          or without notice,  the lapse of time or both, will not conflict with,
          result  in a breach  of,  constitute  a default  under,  result in the
          acceleration  of,  create  in  any  party  the  right  to  accelerate,
          terminate, modify, or cancel, or require any notice under any material
          agreement,  contract, lease, license, instrument, or other arrangement
          to which Holdings is a party or by which it is bound.

          (b) This Agreement has been duly and validly executed and delivered by
Holdings and, as of the Closing,  each of the Holdings Ancillary  Documents will
have been duly and validly  executed and delivered by Holdings.  This  Agreement
constitutes,  and  upon  their  execution  and  delivery,  each of the  Holdings
Ancillary Documents will constitute,  the valid, legal and binding obligation of
the Holdings, enforceable against it in accordance with their terms.

     4.04  Capitalization.  As of July 29, 2003, the authorized capital stock of
Holdings  consists of  180,000,000  shares of common stock,  par value $0.01 per
share, of which  16,244,509  shares are issued and  outstanding  (without giving
effect to the provisions of this  Agreement)  and  20,000,000  shares of Class A
preferred  stock,  par value  $0.01 per share,  of which 0 shares are issued and
outstanding.  There are no other classes of securities of Holdings  outstanding.
The authorized  interest units of the Buyer consists of 10,000 units, of which 1
unit is issued and  outstanding  to Holdings.  Except as otherwise  disclosed on
Schedule 4.04, (i) no subscription,  warrant,  option,  convertible  security or
other right to  purchase or acquire any shares of the capital  stock of Holdings
from Holdings is outstanding  (excluding  the rights of Sellers);  (ii) Holdings
has no obligation to issue any warrant,  option,  convertible  security or other
such right or to issue or  distribute  to  holders of any shares of the  capital
stock of Holdings any evidence of indebtedness or assets of Holdings;  and (iii)
there are no  outstanding  or authorized  stock  appreciation,  phantom stock or
similar  rights  with  respect to  Holdings.  All of the issued and  outstanding
shares of capital  stock of the Buyer are owned by  Holdings.  The  Stock,  when
issued and delivered in

                                       21
<PAGE>

accordance  with  the  terms  of and for  the  consideration  expressed  in this
Agreement, will be duly and validly issued, fully paid and nonassessable.

     4.05  Compliance.  Except where the failure to be in  compliance  would not
have a material effect on Buyer:  (i) the Buyer is in compliance in all material
respects  with  all  applicable  local,  state  and  federal  laws,  ordinances,
regulations, court or administrative orders or decrees; and (ii) the Buyer is in
full compliance  with all of the applicable  rules and regulations of applicable
Credit Card Companies.

     4.06  Litigation.  Except  as set  forth  on  Schedule  4.06,  there  is no
litigation,  arbitration,   governmental  claim,  investigation  or  proceeding,
whether  relating  to a Credit  Card  Company or  otherwise,  pending or, to the
Knowledge  of  Holdings,  threatened  against the Buyer or Holdings at law or in
equity before any court or other  governmental  agency or before any  applicable
agent of a Credit Card  Company  that are  reasonably  likely to have a material
adverse effect on the business of buyer or Holdings. No such proceeding concerns
the transactions contemplated hereby.

     4.07 Disclosure.  No representation or warranty made herein by the Buyer or
Holdings, nor in any statement, certificate or instrument to be furnished to the
Sellers by the Buyer or  Holdings  pursuant to any Buyer  Ancillary  Document or
Holdings  Ancillary  Document contains or will contain any untrue statement of a
material  fact or omits or will omit to state any  material  fact  necessary  in
order to make the statements  and  information  contained  herein or therein not
misleading.

     4.08  Disclosure  to the SEC. No  statement,  report,  filing,  disclosure,
document or any other information transmitted to the SEC by Holdings,  including
those attached as exhibits to the Confidential Disclosure Memorandum, contained,
at the time of filing,  any untrue  statement of a material  fact, or omitted to
state  any  material  fact  necessary  in  order  to  make  the  statements  and
information contained therein not misleading in any material respect.

                                    ARTICLE V
                           COVENANTS PRIOR TO CLOSING

     5.01 Commercially  Reasonable Efforts.  Each of the parties hereto will use
commercially  reasonable  efforts  to  take  all  action  and to do  all  things
necessary,  proper or advisable to consummate the  transactions  contemplated by
this  Agreement.  Each of the parties  hereto will use  commercially  reasonable
efforts  to  secure  all  consents  and  approvals  required  to  carry  out the
transactions  contemplated by this Agreement and to satisfy all other conditions
to the obligations of the parties hereunder. Notwithstanding the foregoing,

          (a) the Company will give any notices of  assignment  to third parties
required to be provided pursuant to any of the Assumed Contracts; and

          (b) each of the Sellers  will use its best efforts to obtain any third
party  consents  required  in order to assign the  Assumed  Contracts  to Buyer,
including  without  limitation  the consents  listed in Schedule  5.05  attached
hereto.

     5.02  Termination  or Merger of Employee  Benefit  Plans.  If  requested by
Buyer, prior to the Closing,  the Company hereby covenants and agrees to freeze,
terminate,  amend,  merge,  or take other  action with  respect to any  Employee
Benefit  Plan  that  Buyer,  in its sole  discretion,  deems  advisable  and not
inconsistent with this Agreement; to take all steps necessary to accomplish such
requests,  including  terminating any Employee  Benefit Plan; to provide all the
required notices to participants and appropriate governmental agencies; to adopt
all  necessary  resolutions  and Employee  Benefit Plan  amendments  in

                                       22
<PAGE>

order to accomplish such requests; and to provide to Buyer satisfactory evidence
of the executed documents described in this Section 5.06.

     5.03  No  Solicitation  of  Other  Offers.  Neither  the  Company  nor  any
Controlling  Shareholder,  acting  through any director,  officer or other agent
(including any investment banker,  attorney,  accountant or other representative
retained by it),  shall  solicit or  encourage,  including by way of  furnishing
information, any inquiries or the making of any proposal which may reasonably be
expected to lead to the  acquisition  of any of the capital stock of the Company
or a substantial portion of the Assets.  Neither the Company nor any Controlling
Shareholder  will,  prior to the Closing,  enter into or conduct any discussions
with any other  prospective  purchaser of any or all of the capital stock of the
Company or the Assets  regarding  such a purchase or enter into any agreement or
negotiations  with respect to the disposition of any or all of the capital stock
of the Company or the Assets, regardless of the form of the transaction, without
the written consent of Buyer. The Company and each Controlling Shareholder shall
promptly advise Buyer in writing of any such inquiries, proposals or discussions
received by the Company or a Controlling Shareholder after the date hereof.

     5.04 Confidentiality and Public Announcements.  Except as and to the extent
required by law,  Holdings,  Buyer,  and Sellers hereby agree not to disclose or
use,  and each shall  cause its  representatives  not to  disclose  or use,  any
confidential information with respect to the other party hereto furnished, or to
be  furnished,  by such  other  party or  their  representatives  in  connection
herewith  at any  time or in any  manner  other  than  in  connection  with  its
evaluation of the transactions contemplated herein, including without limitation
the terms and conditions of this Agreement. In the event of termination pursuant
to  Article  X, the  parties  shall  return all  documents  and other  materials
previously  delivered  concerning the  transactions  contemplated  hereby to the
party that provided such  information.  Neither Holdings nor the Sellers nor any
of their representatives shall make any public announcement with respect to this
Agreement  without  the  prior  written  consent  of the other  parties  to this
Agreement,  except that Holdings shall not be required to obtain consent to make
any disclosure required by law.

     5.05 Tax Disclosure.  Notwithstanding  anything herein to the contrary, the
parties  hereto  (and their  employees,  representatives  and other  agents) may
consult any tax advisor  regarding  the tax  treatment  and tax structure of the
transactions  contemplated  by this  Agreement  and may  disclose to any and all
persons,  without limitation of any kind, the tax treatment and tax structure of
the  transactions  contemplated  by this Agreement and all materials of any kind
(including  opinions  or other tax  analyses)  that are  provided to the parties
relating to such tax treatment and tax structure.  However, any such information
relating  to  the  tax  treatment  or  tax  structure  is  required  to be  kept
confidential  to the extent  necessary to comply with any applicable  federal or
state securities laws.

                                   ARTICLE VI
                        CONDITIONS TO CLOSING BY SELLERS

     The  obligations of the Company and each  Controlling  Shareholder to close
the  transactions  contemplated  by  this  Agreement  shall  be  subject  to the
satisfaction  of the following  conditions.  Upon  Closing,  each of the Sellers
shall be deemed to have waived any unsatisfied  conditions;  provided,  however,
the  waiver of any such  conditions  shall not be deemed to waive or impair  any
rights Sellers may have with respect to the  representations and warranties made
by Buyer.

     6.01 Compliance.  The  representations and warranties of Buyer and Holdings
made in this Agreement  qualified as to  materiality  shall be true and correct,
and those not so qualified  shall be true and correct in all material  respects,
as of the date  hereof and as of the time of the  Closing  as though  made as of
such time, except to the extent such  representations  and warranties  expressly
relate to an earlier  date (in which case such  representations  and  warranties
qualified  as to  materiality  shall  be true  and  correct,  and

                                       23
<PAGE>

those not so qualified  shall be true and correct in all material  respects,  on
and as of such  earlier  date).  Each of Buyer  and  Holdings  shall  have  duly
performed,  complied with and satisfied in all material  respects all covenants,
agreements and conditions  required by this Agreement to be performed,  complied
with or satisfied by it by the time of the Closing.

     6.02  Action;   Proceeding.   No  action,   proceeding,   investigation  or
administrative  hearing before a court or any other governmental  agency or body
shall have been instituted or threatened  against the Company or any Controlling
Shareholder  which seeks  injunctive  relief in  anticipation of the sale of the
Assets and may  reasonably  be  expected  to prohibit  the  consummation  of the
transactions contemplated hereby or seeks damages in a material amount by reason
of the consummation of such transactions.

     6.03 Delivery of Certain  Documents.  At the Closing,  the Buyer shall have
delivered  to the  Company  all of the  documents,  agreements  and  instruments
contemplated by Section 2.03.

     6.04  Employment  Agreements.  By the Closing,  Holdings and/or Buyer shall
enter into  employment  agreements  with  Matthew B. Hyman and Zachary A. Hymen,
individually,  substantially in the form attached hereto as Exhibits 2.02(i) and
2.02(ii).

     6.05 Non-Compete Agreements.  By the Closing, all the members and employees
of  Myisocenter.com,  set forth in Schedule  3.24,  shall  execute a Non-Compete
Agreement substantially in the form attached hereto as Exhibit 2.02(h).

                                   ARTICLE VII
                   CONDITIONS TO CLOSING BY BUYER AND HOLDINGS

     The   obligations   of  Buyer  and  Holdings  to  close  the   transactions
contemplated  by this  Agreement  shall be  subject to the  satisfaction  of the
following  conditions.  Upon Closing, each of Buyer and Holdings shall be deemed
to have waived any unsatisfied conditions;  provided, however, the waiver of any
such  conditions  shall not be deemed to waive or  impair  any  rights  Buyer or
Holdings may have with respect to the representations and warranties made by the
Sellers.

     7.01 Compliance.  The representations and warranties of the Sellers made in
this Agreement qualified as to materiality shall be true and correct,  and those
not so qualified shall be true and correct in all material  respects,  as of the
date  hereof and as of the time of the  Closing as though  made as of such time,
except to the extent such  representations and warranties expressly relate to an
earlier date (in which case such  representations and warranties qualified as to
materiality shall be true and correct,  and those not so qualified shall be true
and correct in all material respects,  on and as of such earlier date).  Sellers
shall have duly performed,  complied with and satisfied in all material respects
all  covenants,  agreements  and  conditions  required by this  Agreement  to be
performed, complied with or satisfied by it by the time of the Closing.

     7.02  Action;   Proceeding.   No  action,   proceeding,   investigation  or
administrative  hearing before a court or any other governmental  agency or body
shall have been  instituted  or threatened  against the Buyer or Holdings  which
seeks  injunctive  relief  in  anticipation  of the sale of the  Assets  and may
reasonably  be  expected  to  prohibit  the  consummation  of  the  transactions
contemplated  hereby  or seeks  damages  in a  material  amount by reason of the
consummation of such transactions.

     7.03 Delivery of Certain Documents.  At the Closing, the Company shall have
delivered  to Buyer and  Holdings  all  documents,  agreements  and  instruments
contemplated by Section 2.02.

                                       24
<PAGE>

     7.04 Pension  Plan  Liability.  The Buyer shall be  satisfied  that it will
incur no liability with respect to any Employee Benefit Plan or other pension or
post-retirement benefits provided by the Company.

     7.05  License..The  Buyer  shall  have  received  a  License  Agreement  in
substantially the form attached as Exhibit 2.02(f),  executed by all the members
of Myisocenter.com, L.L.C.

     7.06 UCC Lien Search. The Buyer shall have received a satisfactory UCC lien
search on the Company from the office of the Secretary of State of the Company's
state of  incorporation  and each state  listed in Schedule  3.01,  and from the
appropriate office in each county in which the Company has business  operations.
Such lien searches  will be conducted by an entity or  individual  acceptable to
the  Buyer  at  the  Buyer's  sole  expense.   The  Buyer  shall  have  received
satisfactory  evidence of the release or  termination of any such lien requested
by Buyer. Buyer shall assume responsibility for obtaining the UCC lien search.

     7.07 Intentionally Omitted.

     7.08 Intentionally Omitted.

     7.09 Name Change. The Company shall have filed articles of amendment to its
Articles of Incorporation with the Secretary of State of California changing the
name of the Company to CSI Holdings,  Inc. The effective  date of such amendment
shall be no later than thirty (30) days following the Closing Date.

     7.10 No Adverse  Change.  There shall not have been any change  between the
date of the latest  Financial  Statements  and the Closing Date which has had or
will have a  material  adverse  effect on the  business,  operations,  financial
condition, Assets or prospects of the Company, and a certificate shall have been
delivered to Buyer to such effect signed by the each Controlling Shareholder and
such officers of the Company as Buyer may request.

                                  ARTICLE VIII
                             POST CLOSING COVENANTS

     8.01 Offerees.

          (a) Provided that Company  shall have  delivered  Schedule  3.14(a) to
Buyer not less than ten (10) days prior to Closing,  Buyer  shall offer  at-will
employment  to all  employees  listed on Schedule  3.14(a)  who are  employed by
Company at Closing, except as otherwise set forth on Schedule 8.01 hereto and as
otherwise provided hereinbelow (the employees who receive such employment offers
from Buyer are collectively  referred to herein as the "Offerees").  Such offers
shall  be for  positions  and at  compensation  comparable,  excluding  employee
benefits,  to that  enjoyed  by such  Offerees  immediately  prior  to  Closing.
Notwithstanding  the foregoing,  Buyer does not commit to and does not guarantee
the  continued  employment  of any  such  individuals  for any  definite  period
following  Closing and Buyer hereby  acknowledges  that either it or any Offeree
may terminate the employment relationship for any or no reason at any time after
Closing.  Nothing  herein  shall be deemed to affect or limit in any way  normal
management prerogatives of Buyer with respect to employees or to create or grant
to any such  employee  or Offeree  third-party  beneficiary  rights or claims or
causes of action of any kind or nature.

          (b) With respect to (i) any employee of Company to whom Buyer does not
offer  employment,  (ii)  any  Offeree  who  does not  accept  Buyer's  offer of
employment or (iii) any Offeree who may accept such offer,  but fails to perform
any services for Buyer (collectively, the "Non-Offerees"),

                                       25
<PAGE>

Sellers shall retain the obligation for providing COBRA notices and continuation
coverage  under  Section  4980B of the Code and  Section  601 of ERISA and shall
offer  COBRA  continuation  coverage  under  its group  health,  dental or other
medical plans to such Non-Offerees for as long as such Non-Offerees are entitled
to  COBRA  continuation  coverage  under  the  law.  Further,  Sellers  agree to
indemnify  and hold Buyer and its group health plan  harmless in the event Buyer
or Holdings or its group health plan shall be liable for any COBRA  continuation
coverage,  or any  claim  or  liability  with  respect  thereto,  for any of the
Non-Offerees.

     8.02  Further  Assurances.  From  time  to  time,  as and  when  reasonably
requested by another party hereto, a party hereto shall execute and deliver,  or
cause to be executed and delivered, all such documents and instruments and shall
take, or cause to be taken, all such further acts or other actions as such other
party may reasonably deem necessary or desirable to consummate the  transactions
contemplated by this Agreement.

     Without limiting the generality of the foregoing, Sellers shall execute and
deliver to Buyer such documents and  instruments as are reasonably  necessary to
transfer  the  URL's and  domain  names  that  comprise  a portion  of the Owned
Intellectual  Property,  including without  limitation the URLs and domain names
set forth on Schedule 1.01(c).

     8.03  Merchant  Reserves.  After the  Closing,  neither the Company nor any
Controlling  Shareholder  shall  draw or make  any  claim  against,  or agree to
release,  any Merchant Reserve Account or any security deposit held by Processor
on behalf of any  Merchant,  except for any losses  incurred  by the  Company to
Processor  relating to  transactions  by the Merchants prior to the Closing that
are otherwise not recovered by or reimbursed to the Company.

     8.04 Trailing Activities.  Until the date that is nine (9) months after the
Closing,  the Sellers will assist the Buyer in resolving  any trailing  activity
related to the Merchant Accounts,  including without limitation  Chargebacks (as
defined in the applicable  rules and regulations of Visa and/or  MasterCard) and
representments.

     8.05  Name  Change.  The  Sellers  acknowledge  and agree  that,  except as
provided  in  Schedule  3.04,  the Buyer will  acquire as part of the Assets the
exclusive right to use the name "CardPayment Solutions, Inc.", and any variation
thereof and the goodwill  associated  therewith and that neither the Company nor
any Controlling Shareholder will use the name "CardPayment  Solutions,  Inc." or
any derivative thereof subsequent to the Closing, except the Company may use the
name  "CardPayment  Solutions,  Inc." for a period of thirty  (30) days from the
Closing Date.  The Company  further  covenants and agrees that,  within ten (10)
days of the Closing Date,  the Company will file an amendment to its Articles of
Incorporation  changing its name to CSI Holdings,  Inc. and that such  amendment
shall have an  effective  date that is not more than thirty (30) days  following
the Closing Date.

     8.06 Existence. The Controlling Shareholders hereby covenant and agree that
the Company  shall not be dissolved  without the consent of Holdings  during the
eighteen (18) month period immediately following Closing.

     8.07 Myisocenter.com,  L.L.C. The members of Myisocenter.com,  L.L.C. shall
cause the dissolution of  Myisocenter.com,  L.L.C. within 30 days of the Closing
Date.

                                                           26
<PAGE>

                                   ARTICLE IX
                                 INDEMNIFICATION

     9.01  Indemnification  of Buyer and Holdings.  Subject to the terms of this
Article IX, the  Company and each  Controlling  Shareholder  (collectively,  the
"Seller  Indemnifying  Parties"),   jointly  and  severally,  agree  to  defend,
indemnify and hold harmless Buyer, Holdings, each officer, director, employee or
agent  thereof,  their  respective  controlling  persons,  and their  respective
estates, successors, and assigns (collectively, the "Seller Indemnified Parties"
and each an "Indemnified Party"), from and against any and all Losses reasonably
incurred by such Indemnified Party as a result of:

          (a)  the  untruth,  inaccuracy  or  breach  of any  representation  or
warranty  made by the Company  and/or by a Controlling  Shareholder  pursuant to
Article III of this Agreement, any Company Ancillary Document or any Shareholder
Ancillary Document;

          (b)  the  nonfulfillment  or  breach  of any  covenant,  agreement  or
obligation of the Company and/or by the  Controlling  Shareholders  contained in
this  Agreement,  any Company  Ancillary  Document,  CPS  Shareholder  Ancillary
Document or Controlling Shareholder Ancillary Document;

          (c) any claim or demand by any person  asserting  any  interest in the
Assets or seeking  dissenters' or appraisal rights or any other claim in respect
to the transactions contemplated by this Agreement;

          (d)  any  liability  or  claim  arising  out of the  operation  of the
Business  prior to the Closing  which is imposed upon Buyer or Holdings,  except
the Assumed Chargeback Liabilities;

          (e)  any  liability  or  claim  arising  out of the  operation  of the
Business  prior to the Closing  which is imposed upon Buyer or Holdings,  except
for the Assumed  Chargeback  Liabilities and others to the extent such liability
or claim has been  expressly  assumed by Buyer  pursuant to the  Assignment  and
Assumption Agreement;

          (f) any liability or claim arising out of an  investigation,  holdback
or other  action  taken with  respect to a merchant  which is  initiated  by the
Company prior to Closing;

          (g) any  liability  arising from a violation of any federal,  state or
local law before the Closing Date,  including without limitation,  any violation
of ERISA, HIPAA, COBRA;

          (h) any liability arising from the Company's  improper  classification
of any individual as an independent  contractor,  non-employee or employee prior
to the Closing,  including  without  limitation  liability  relating to Employee
Benefit Plan coverage, Taxes and workers compensation; and

          (i)  any  liability  arising  from  the  operation,  establishment  or
termination of any employee benefit plan, ERISA or COBRA.

     9.02  Indemnification  of the Company and the Shareholders.  Subject to the
terms of this  Article IX,  Buyer and  Holdings,  jointly and  severally,  shall
indemnify and hold  harmless each  Controlling  Shareholder,  the Company,  each
officer,  director,  employee or agent  thereof,  their  respective  controlling
persons, and their respective estates,  successors,  and assigns  (collectively,
the "Buyer  Indemnified  Parties"  and each an  "Indemnified  Party"),  from and
against any and all Losses  reasonably  incurred by such Indemnified  Party as a
result of:

                                       27
<PAGE>

          (a)  the  untruth,  inaccuracy  or  breach  of any  representation  or
warranty made by the Buyer or Holdings in this  Agreement,  any Buyer  Ancillary
Document or in any Holdings Ancillary Document;

          (b)  the  nonfulfillment  or  breach  of any  covenant,  agreement  or
obligation of Buyer or Holdings contained in this Agreement, any Buyer Ancillary
Document or in any Holdings Ancillary Document; and

          (c) any  liability  imposed  upon the Company or any of its  officers,
directors, employees or shareholders, to the extent that such liability has been
expressly  assumed by Buyer  pursuant to this  Agreement or the  Assignment  and
Assumption Agreement.

     9.03 Procedure for  Indemnification - Non Third Party Claims.  Whenever any
claim shall arise for  indemnification  hereunder not involving a Proceeding (as
hereinafter defined),  the Indemnified Party shall notify the indemnifying party
promptly  after  such  Indemnified  Party  has  actual  Knowledge  of the  facts
constituting  the basis for such  claim.  The notice to the  indemnifying  party
shall  specify,  if  known,  the  amount  or an  estimate  of the  amount of the
liability arising therefrom.

     9.04 Procedure for Indemnification - Third Party Claims.

          (a) Promptly  after receipt by an  Indemnified  Party of notice of the
commencement of any Proceeding, such Indemnified Party will, if a claim is to be
made against an  indemnifying  party pursuant to this Article IX, give notice to
the indemnifying party of the commencement of the Proceeding, but the failure to
notify the  indemnifying  party will not relieve the  indemnifying  party of any
liability that it may have to the Indemnified  Party,  except to the extent that
the  indemnifying  party  demonstrates  that  the  defense  of  such  action  is
prejudiced by the indemnified party's failure to give such notice.

          (b) If any  Proceeding  referred  to in  Section  9.04(a)  is  brought
against an  Indemnified  Party and such  Indemnified  Party gives  notice to the
indemnifying  party of the  commencement of such  Proceeding,  the  indemnifying
party will be entitled to participate in such Proceeding and, to the extent that
it wishes (unless the indemnifying  party is also a party to such Proceeding and
the Indemnified Party determines in good faith that joint  representation  would
be  inappropriate),  to assume  the  defense  of such  Proceeding  with  counsel
satisfactory  to the Indemnified  Party and, after notice from the  indemnifying
party to the  Indemnified  Party of its  election  to assume the defense of such
Proceeding,  the indemnifying party will not, as long as it diligently  conducts
such defense, be liable to the Indemnified Party under this Section 9.04 for any
fees of other counsel or any other  expenses with respect to the defense of such
Proceeding,  incurred by the Indemnified Party in connection with the defense of
such  Proceeding,   other  than  reasonable  costs  of  investigation.   If  the
indemnifying  party  assumes  the  defense  of a  proceeding,  (y)  it  will  be
conclusively  established for purposes of this Agreement that the claims made in
the  Proceeding  are  within  the scope of and  subject  to  indemnification  in
accordance  with this Article IX and (z) no  compromise  or  settlement  of such
claims may be effected by the indemnifying party without the Indemnified Party's
consent  unless (I) there is no finding or admission  of any  violation of legal
requirements  or any  violation of the rights of any person and no effect on any
other claims that may be made against the Indemnified  Party;  and (II) the sole
relief  provided is monetary  damages that are paid in full by the  indemnifying
party;  and (III) the  Indemnified  Party will have no liability with respect to
any  compromise or settlement of such claims  effected  without its consent.  If
notice is given to an indemnifying  party of the  commencement of any Proceeding
and the  indemnifying  party does not,  within  ten days  after the  Indemnified
Party's notice is given, give notice to the indemnified party of its election to
assume the defense of such Proceeding,  the indemnifying  party will be bound by
any  determination  made in such  Proceeding  or any  compromise  or  settlement
effected by the Indemnified Party.

                                       28
<PAGE>

          (c) Notwithstanding the foregoing, if an Indemnified
Party determines in good faith that there is a reasonable probability that a
Proceeding may adversely affect it or its affiliates other than as a result of
monetary damages for which it would be entitled to indemnification under this
Agreement, the Indemnified Party may, by notice to the indemnifying party,
assume the exclusive right to defend, compromise or settle. If the indemnifying
party does not assume the defense of any claim or litigation, any Indemnified
Party may defend against such claim or litigation in such manner as it may deem
appropriate, including, but not limited to, settling such claim or litigation,
after giving notice of the same to the indemnifying party, on such terms as the
Indemnified Party may deem appropriate. The indemnifying party will promptly
reimburse the Indemnified Party in accordance with the provisions hereof.

     9.05 Survival Claims Period. No claim for  indemnification  may be asserted
hereunder unless the Indemnified  Party gives the  indemnifying  party notice of
such claim before the end of the applicable Survival Period; provided that where
notice of such  claim has been  timely  given,  such  claim  shall  survive  the
expiration of the Survival Period.

     9.06 Amount Precedent to Any Indemnification Claim.

          (a) The Buyer Indemnified Parties shall not be entitled
to receive payment of any claim for indemnification with respect to any matter
arising under Section 9.02 unless:

               (i) the  amount of the  claim  arising  out of such  matter is in
          excess of Minimum Claim in any one instance; and

               (ii) the aggregate  amount of all claims being made by such Buyer
          Indemnified  Parties (together with all such claims previously made by
          such parties) exceeds the Basket,  in which event the  indemnification
          shall be all indemnifiable Losses beginning with the first dollar.

               (iii) Notwithstanding the foregoing, any claims made with respect
          to the  payment  of the  Purchase  Price  shall not be  subject to the
          thresholds established by this Section 9.06.

          (b) The Seller  Indemnified  Parties  shall not be entitled to receive
     payment  for any claim  for  indemnification  with  respect  to any  matter
     arising under Section 9.01 unless:

               (i) the  amount of the  claim  arising  out of such  matter is in
          excess of the Minimum Claim in any one instance; and

               (ii) the aggregate amount of all claims being made by such Seller
          Indemnified  Parties (together with all such claims previously made by
          such parties) exceeds the Basket,  in which event the  indemnification
          shall be all indemnifiable Losses beginning with the first dollar.

               (iii)  Notwithstanding  the  foregoing,  any claims  having their
          bases  in the  following  shall  not  be  subject  to  the  thresholds
          established  by this Section:  (i) breach of the  representations  and
          warranties contained in Sections 3.02(a)(ii),  3.03(a)(ii),  3.04 (but
          only with respect to title),  3.11,  3.16,  3.19 and 3.22, (ii) claims
          under Section 9.01(c), 9.01(d), 9.01(e), 9.01(f) , 9.01(g) and 9.01(h)
          or (iii) fraud or intentional misrepresentation.

                                       29
<PAGE>

     (c) In  determining  whether  a Seller  Indemnified  Party is  entitled  to
recover for any Losses under  Section  9.01(a),  any  materiality  qualification
contained in any  representation  or warranty of the Company and/or  Controlling
Shareholders shall not be taken into account in determining the magnitude of the
Losses occasioned by any breach thereof for purposes of determining what amounts
are applied to the Basket.

     9.07  Cap  on  Indemnification   Liability.   The  maximum  indemnification
liability of any party hereto  shall not exceed the Cap,  provided  however that
any claims for indemnification  having their bases in the following shall not be
subject to the  thresholds  established  by this Section 9.07: (i) breach of the
representations and warranties contained in Sections  3.02(a)(ii),  3.03(a)(ii),
3.04 (but only with respect to title),  3.11,  3.16,  3.19 and 3.22, (ii) claims
under  Section  9.01(c),  9.01(d)  and  9.01(e)  or (iii)  fraud or  intentional
misrepresentation.

     9.08 Payment. All indemnification hereunder shall be effected by payment of
cash or  delivery of a  certified  or  official  bank check in the amount of the
indemnification  liability or by set-off  against any amounts  otherwise owed by
the Buyer to Company,  or by the  Company or a  Controlling  Shareholder  to the
Buyer, as the case may be.

                                    ARTICLE X
                                   TERMINATION

     10.01  Termination  of Agreement.  Except as otherwise set forth in Section
10.02, this Agreement and the transactions contemplated hereby may be terminated
at any time prior to the Closing Date as follows:

          (a) By mutual written consent of the Buyer and the Company;

          (b) By Buyer,  if there  has been a  material  violation  or breach by
     Sellers of any of the agreements,  representations or warranties  contained
     in this Agreement which has not been waived in writing;

          (c) By the Company if there has been a material violation or breach by
     Buyer or Holdings of any of the agreements,  representations  or warranties
     contained in this Agreement which has not been waived in writing;

          (d) By either the Company or Buyer if the Closing has not  occurred on
     or before August 15, 2003.

     10.02  Effect  of  Termination.   Notwithstanding  any  provision  of  this
Agreement  to the  contrary,  neither the Company nor Buyer may  terminate  this
Agreement  if the event  that gives rise to such  termination  right  results in
whole or in part from the  willful  failure  of such party to perform or observe
any of the covenants or agreements  set forth herein to be performed or observed
by such  party or if such  party is, at such time,  in  material  breach of this
Agreement.  The right of  termination  under  Section  10.01 may be exercised by
Buyer or the Company, as the case may be, only by giving written notice,  signed
on behalf of such party by its duly  authorized  officer,  to the other  parties
hereto.  Except for the  obligations  set forth in Article IX and Sections 5.07,
5.08 and 11.02, all obligations, liabilities and responsibilities of the parties
hereunder  will  terminate  and have no further  force or effect except that (a)
upon request  therefor,  each party will return all  documents,  work papers and
other material of any other party relating to the  transactions  contemplated by
this  Agreement,  whether  so  obtained  before or after the  execution  of this
Agreement,  to the party furnishing the same, and all  confidential  information
received  by any party to this  Agreement  with  respect to the  business of the
other party will be treated in accordance with the

                                       30
<PAGE>

Section  5.08  hereof;  and (b) no  exercise  by  either  party of its  right to
terminate this Agreement  pursuant to Section 10.01 shall prejudice that party's
rights and remedies  against the other  parties for breach of such other party's
obligations under this Agreement or otherwise.

                                   ARTICLE XI
                            MISCELLANEOUS PROVISIONS

     11.01 No Brokerage.  Each party hereto represents and warrants to the other
parties hereto that it has not incurred any obligation or liability,  contingent
or otherwise,  for brokerage or finders'  fees or agents'  commissions  or other
like payment in connection with this Agreement or the transactions  contemplated
hereby,  and each party  agrees to indemnify  and hold the other party  harmless
against and in respect of any such  obligation or liability  based in any way on
agreements,  arrangements  or  understandings  claimed to have been made by such
party with any third party.

     11.02  Expenses.  Whether  or not  the  transactions  contemplated  by this
Agreement are consummated, each of the parties hereto shall pay its own fees and
expenses incident to the negotiation,  preparation, execution and performance of
this Agreement including counsel and accountant's fees.

     11.03 Misdirected Payments,  Etc.. The Company and Buyer covenant and agree
to remit, with reasonable promptness,  to the other any payments received, which
payments are on or in respect of accounts or notes  receivable  owned by (or are
otherwise payable to) the other.

     11.04 Third Party Beneficiary.  None of the provisions herein contained are
intended by the parties,  nor shall they be deemed, to confer any benefit on any
person not a party to this Agreement.

     11.05  Entire  Agreement/Amendment.   This  Agreement,  together  with  the
Schedules,   Buyer  Ancillary   Documents,   Company  Ancillary   Documents  and
Shareholder Ancillary Documents, supersedes all prior contracts,  understandings
and agreements, whether written or oral, and constitutes the entire agreement of
the parties  respecting the within subject matter and no party shall be entitled
to benefits other than those specified  herein. As between or among the parties,
no oral statements or prior written  material not  specifically  included herein
shall be of any force and effect; the parties  specifically  acknowledge that in
entering into and  executing  this  Agreement,  the parties rely solely upon the
representations  and agreements  contained in this  Agreement and no others.  No
terms, conditions,  warranties,  or representations,  other than those contained
herein and no amendments or modifications  hereto,  shall be binding unless made
in writing and signed by the party to be charged.

     11.06  Severability.  Should  any  one or more  of the  provisions  of this
Agreement or any  agreement  entered into  pursuant  hereto be  determined to be
illegal or unenforceable,  all other provisions of this Agreement and such other
agreements  shall be given effect  separately  from the  provision or provisions
determined to be illegal or unenforceable and shall not be affected thereby.

     11.07 Waiver.  The waiver by any party of a breach or violation of any term
or  provision of this  Agreement  shall not operate as, or be construed to be, a
waiver of any  subsequent  breach of the same  provision  by any party or of the
breach of any other term or provision of this Agreement.  The delay or a failure
of a party to transmit  any written  notice  hereunder  shall not  constitute  a
waiver by such party of any default hereunder or of any other or further default
under this  Agreement  except as may  expressly  be provided for by the terms of
this Agreement.

     11.08  Enforcement.  Should any legal proceedings be commenced to secure or
enforce any right under this Agreement or any agreement entered into pursuant to
the terms  hereof,  the  prevailing  party shall be entitled to recover from the
non-prevailing  party its reasonable  attorneys'  fees and costs, in

                                       31
<PAGE>

addition  to all other  relief to which  said  party may be  entitled.  The term
"prevailing party" shall mean that party whose position is substantially  upheld
in a final judgment  rendered in such  litigation,  or, if the final judgment is
appealed,  that party whose position is substantially  upheld by the decision of
the final appellate body.

     11.09  Construction  of Terms.  The language used in the Agreement shall be
construed,  in all cases,  according to its fair meaning, and not for or against
any party  hereto.  The parties  acknowledge  that each party has reviewed  this
Agreement  and  that  normal  rules  of  construction  to the  effect  that  any
ambiguities are to be resolved  against the drafting party shall not be employed
in the  interpretation of this Agreement.  Whenever the masculine gender is used
herein, it shall be deemed to include the feminine and the neuter.


     11.10  Governing Law and Disputes.  This  Agreement  shall be construed and
enforced in accordance  with the laws of the State of California  without regard
to its  principles  of conflicts of laws.  Any action or  proceeding  seeking to
enforce any provision  of, or based on any right arising out of, this  Agreement
may be  brought  against  any of the  Parties  in the  courts  of the  State  of
California, County of Los Angeles, or, if it has or can acquire jurisdiction, in
the United States District Court for Central California, and each of the Parties
consents to the  jurisdiction of such courts (and of the  appropriate  appellate
courts) in any such action or proceeding  and waives any objection to venue laid
therein.  Process  in any  action or  proceeding  referred  to in the  preceding
sentence  may be served on any party  anywhere  in the  world.  14.15 EACH PARTY
HERETO HEREBY  IRREVOCABLY  WAIVES ANY AND ALL RIGHTS IT MAY HAVE TO DEMAND THAT
ANY ACTION,  PROCEEDING OR COUNTERCLAIM  ARISING OUT OF OR IN ANY WAY RELATED TO
THIS AGREEMENT OR THE RELATIONSHIPS OF THE PARTIES HERETO BE TRIED BY JURY. THIS
WAIVER  EXTENDS TO ANY AND ALL RIGHTS TO DEMAND A TRIAL BY JURY ARISING FROM ANY
SOURCE  INCLUDING,  BUT NOT LIMITED TO, THE CONSTITUTION OF THE UNITED STATES OR
ANY STATE THEREIN,  COMMON LAW OR ANY APPLICABLE  STATUTE OR  REGULATIONS.  EACH
PARTY HERETO ACKNOWLEDGES THAT IT IS KNOWINGLY AND VOLUNTARILY WAIVING ITS RIGHT
TO DEMAND TRIAL BY JURY.


     11.11  Notices.  All notices,  requests,  demands and other  communications
required or permitted hereunder shall be in writing and shall be deemed given on
the date  personally  delivered,  sent by  registered  or certified  mail,  with
postage prepaid, or by any nationally recognized overnight courier service or by
facsimile to the respective parties as follows:

     (a)  If to Sellers, to:            CardPayment
                                        Solutions, Inc. 4213 State
                                        Street, Suite 303 Santa
                                        Barbara, California 93110
                                        Attention:  Zachary A. Hyman
                                        Facsimile:  (805) 696-9641

          with a copy to:               Van Etten Suzumoto and Becket LLP
                                        1620 26th Street, Suite 6000 North
                                        Santa Monica, California  90404
                                        Attention:  Adam Thorpe
                                        Facsimile:  (310) 315-8210

     (b)  If to Buyer or Holdings, to:  iPayment, Inc.
                                        40 Burton Hills, Suite 415

                                       32
<PAGE>

                                        Nashville, Tennessee  37215
                                        Attention:  Afshin M. Yazdian
                                        Facsimile:  (615) 665-8434

          with a copy to:               Waller Lansden Dortch & Davis, PLLC
                                        511 Union Street, Suite 2100
                                        Nashville, Tennessee 37219-1760
                                        Attention:  Howard W. Herndon
                                        Facsimile:  (615) 244-6804

or to such other person or address as either party shall furnish the other party
in writing.

     11.12 Assignment.  This Agreement and all of the provisions hereof shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors,  but neither  this  Agreement  nor any of the rights,  interests  or
obligations  hereunder  shall be assigned by Sellers  without the prior  written
consent of the Buyer.

     11.13  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 instrument.

     11.14  Consented  Assignment.  Anything  contained  herein to the  contrary
notwithstanding,  this Agreement shall not constitute an agreement to assign any
claim, right,  contract,  license,  lease,  commitment,  sales order or purchase
order if an attempted  assignment  thereof  without the consent of another party
thereto  would  constitute  a breach  thereof or in any  material way affect the
rights of the Company  thereunder,  unless  such  consent is  obtained.  If such
consent is not obtained,  or if an attempted  assignment would be ineffective or
would materially  affect the Company's rights thereunder so that Buyer would not
in fact receive all such rights,  the Company shall  cooperate in any reasonable
arrangement designed to provide Buyer the benefit under any such claims, rights,
contracts,  licenses,  leases,  commitments,  sales  orders or purchase  orders,
including without limitation, enforcement, at no out-of-pocket cost to Buyer, of
any and all rights of the Company  against  the other  party or parties  thereto
arising out of the breach or cancellation by such other party or otherwise.

     11.15 Survival.  All statements made by the parties hereto herein or in the
Schedules  or  in  any  other   financial   statement,   document,   instrument,
certificate,  Exhibit or list delivered to each other  hereunder by or on behalf
of parties hereto shall be deemed  representations and warranties of the parties
hereto  regardless  of any  investigation  made  by or on  behalf  of  Buyer  or
Holdings. Furthermore, the representations, warranties, covenants and agreements
made  by  the  parties  herein  shall  survive  the  Closing  but  shall  expire
twenty-four  (24) months  after the  Closing  Date,  except with  respect to the
representations,  warranties  and covenants  set forth in Sections  3.02(a)(ii),
3.03(a)(ii),  3.04 (but only with respect to title),  3.11, 3.16, 3.19 and 3.22,
which  shall  survive  for  the  applicable   statute  of  limitations   periods
(collectively,  the "Survival  Period").  Notwithstanding  the  foregoing,  this
Section  11.15 shall not provide  third  parties any benefit or longer period of
time in which to assert a claim  beyond that which is  provided by the  relevant
statute of limitations.

     11.16 Headings.  The headings  contained in this Agreement are inserted for
convenience only and shall not constitute a part hereof.

     11.17  Setoff.  Holdings  and  Buyer  shall  have  the  right to set off on
recovery  any  payment  or  recovery  due  to  it  from  the  Company,  the  CPS
Shareholders or the Controlling Shareholders against any amount otherwise due or
payable, including without limitation the Shares of Holdings Stock held pursuant
to the Escrow  Agreement,  those Contingent  Payments due under Section 1.05(d),
and any other

                                       33
<PAGE>

payments arising from or under this Agreement,  any Ancillary  Documents and the
Employment Agreements, by Holdings or Buyer to the Company, the CPS Shareholders
or any Controlling Shareholder for any reason.

     11.18 IRS Reimbursement.  Buyer or Holdings shall reimburse the Company for
up to  $36,000 of  penalties,  interest  or fines in  relation  to the  specific
liability of the Company referenced in Section 1.04(l).

                                   ARTICLE XII
                                   DEFINITIONS

     For the  purposes of this  Agreement,  the  following  terms shall have the
meanings set forth in this Article XII:

     "1933 Act" shall mean the Securities Act of 1933, as amended.

     "Agreement" shall have the meaning set forth in the introduction.

     "Assets" shall have the meaning set forth in Section 1.01.

     "Assignment and Assumption  Agreement"  shall have the meaning set forth in
Section 2.02(b).

     "Assumed  Chargeback  Liability"  shall mean those  Chargebacks  related to
Pre-Closing Transactions that only: (i) are processed,  presented for payment or
otherwise  identified or for which Buyer  receives  notice within 6 months after
the Effective Time in an amount not to exceed,  in the  aggregate,  $60,000 with
respect  to  non-equipment  leasing/rental  activities  and,  in the  aggregate,
$10,000  with  respect  to  equipment  leasing/rental  activities;  or (ii)  are
processed,  presented  for payment or  otherwise  identified  or for which Buyer
receives notice beyond 6 months after the Effective Time.

     "Assumed   Contracts"  shall  mean,   collectively,   the  Assumed  Leases,
Processing   Agreement[s],   Sponsorship   Agreement[s],   License   Agreements,
Independent Agent Agreements and those listed on Schedule 1.01(k).

     "Assumed Leases" shall mean, collectively, the Operating Leases and Capital
Leases.

     "Assumed Liabilities" shall have the meaning set forth in Section 1.03.

     "Basket" shall mean Fifteen Thousand and No/100 Dollars ($15,000).

     "Bill of Sale" shall have the meaning set forth in Section 2.02(a).

     "Business" shall have the meaning set forth in the introduction.

     "Buyer" shall have the meaning set forth in the introduction.

     "Buyer  Ancillary  Documents"  shall mean the  agreements  and  instruments
(other than this  Agreement) to be executed and  delivered by Buyer  pursuant to
this Agreement.

     "Buyer  Benefit  Plans" shall mean the employee  benefit  plans of Buyer or
Holdings.

     "Buyer  Health  Plan"  shall  mean the  health  insurance  plan of Buyer or
Holdings.

                                       34
<PAGE>

     "Buyer  Indemnified  Parties"  shall have the  meaning set forth in Section
9.02.

     "Buyer  Plans"  shall mean,  collectively,  the Buyer Health Plan and Buyer
Benefit Plans.

     "Cap" shall mean, with respect to the Sellers  liability,  $5,000,000,  and
with respect to Buyers and Holdings liability, $2,000,000.

     "Capital Leases" shall have the meaning set forth in Section 1.01(e).

     "Cash" shall have the meaning set forth in Section 1.05(b).

     "Chargeback" means a charge on a credit card or debit card that is returned
or unpaid by the  financial  or other  institution  that  issued such card and a
charge  as  otherwise  defined  in  the  rules,  regulations  or  bylaws  of the
applicable  Credit Card  Company.  For purposes of this  definition,  Chargeback
shall also include  those card  association  fines,  penalties,  fees and Losses
related to or arising from merchant  transactions  of the  Business,  as well as
Losses related to or arising from equipment leasing/rental activities related to
the Business.

     "Closing" shall have the meaning set forth in Section 2.01.

     "Closing Date" shall have the meaning set forth in Section 2.01.

     "COBRA" shall mean Title I, Part 6 of ERISA.

     "Code" shall mean the Internal  Revenue Code of 1986,  as amended,  and the
rules and regulations promulgated thereunder.

     "Company" shall have the meaning set forth in the introduction.

     "Company Debt" shall be those items noted on Schedule 1.03(d).

     "Company  Ancillary  Documents"  shall mean the agreements and  instruments
(other than this Agreement) to be executed and delivered by the Company pursuant
to this Agreement.

     "Contracts" shall have the meaning set forth in Section 1.01(k).

     "Controlling   Shareholder"  shall  have  the  meaning  set  forth  in  the
introduction.

     "Courts" shall have the meaning set forth in Section 11.10.

     "Credit  Card  Company"  shall mean  Visa,  MasterCard,  American  Express,
Discover or other credit or debit card company.

     "Deposits" shall have the meaning set forth in Section 1.01(l).

     "DOL" shall mean the United States Department of Labor.

     "Effective Time" shall mean 12:01 a.m. on August 1, 2003.

     "Employment  Agreements" shall mean those agreements  referenced in Section
2.02(h).

     "Employee Benefit Plan" shall have the meaning set forth in Section 3.16.

                                       35
<PAGE>

     "ERISA"  shall  mean the  Employee  Retirement  Security  Act of  1974,  as
amended, and the rules and regulations promulgated thereunder.

     "ERISA Affiliate" shall have the meaning set forth in Section 3.16(j).

     "Excluded Assets" shall have the meaning set forth in Section 1.02.

     "Financial Statements" shall have the meaning set forth in Section 3.07.

     "GAAP" shall mean generally accepted  accounting  principles adopted in the
United States.

     "Holdings" shall have the meaning set forth in the introduction.

     "Holdings  Ancillary  Documents"  shall mean the agreements and instruments
(other than this Agreement) to be executed and delivered by Holdings pursuant to
this Agreement.

     "Inactive  Employees"  shall  mean  employees  of the  Company  who are not
actively working as of the Closing,  whether as a result of a pre-approved leave
of absence or otherwise.

     "Indemnified Party" shall have the meaning set forth in Section 9.01.

     "Independent  Agent  Agreement" shall have the meaning set forth in Section
10.0(t).

     "Information Systems Transition Agreement" shall have the meaning set forth
in Section 2.02(f).

     "IRS" shall mean the Internal Revenue Service.

     "Key  Employees"  shall mean Tom Mulkins,  Jennifer  Hill, Vy Luong and Art
Perez.

     "Knowledge" For the purpose of this Agreement, references to the "knowledge
of the  Company"  shall  mean  only  the  actual  knowledge  of the  Controlling
Shareholders  of the Company,  its  officers,  Key  Employees and members of its
board of directors;  references to "knowledge of Controlling Shareholders" shall
mean only the actual knowledge of Zachary A. Hyman and Matthew B. Hyman, without
investigation;  and  reference  to  "knowledge  of Sellers"  shall mean only the
actual  knowledge of any of the Company,  as defined above,  and the Controlling
Shareholders,  as defined  above,  and shall not be construed by  imputation  or
otherwise, to refer to the knowledge of any other shareholder,  agent, employee,
representative,  any manger, sales representative,  independent or otherwise, or
affiliate of the Seller or to impose upon any of the  Controlling  Shareholders,
directors, agents, employees,  representatives of Seller any duty to investigate
the matter to which actual knowledge, or the absence thereof pertains.

     "License Agreements" shall have the meaning set forth in Section 1.01(j).

     "Losses"  shall mean  claims,  losses,  damages,  liabilities  and expenses
including  without  limitation  settlement costs and any legal or other expenses
for investigating or defending any action or threatened action.

     "MasterCard" shall mean MasterCard International, Inc.

     "Merchant Accounts" shall have the meaning set forth in Section 3.10.

     "Merchant Agreements" shall have the meaning set forth in Section 1.01(i).

                                       36
<PAGE>

     "Merchant  Reserve  Account"  shall have the  meaning  set forth in Section
8.03.

     "Merchants"  shall mean any  customer  for whom the  Company,  directly  or
indirectly,  provides processing or other credit or debit card related services,
including without limitation the Merchants set forth on Schedule 1.01(o) hereto.

     "Minimum Claim" shall mean Five Hundred and No/100 Dollars ($500).

     "Non-Offerees" shall have the meaning set forth in Section 8.01(d).

     "Offer Request" shall have the meaning set forth in Section 8.01(c).

     "Offerees" shall have the meaning set forth Section 8.01(a).

     "Operating Leases" shall have the meaning set forth in Section 1.01(f).

     "Owned  Intellectual  Property" shall have the meaning set forth in Section
1.01(c).

     "PBGC" shall mean the Pension Benefit Guaranty Corporation.

     "Pre-Closing   Transactions"  shall  mean  Merchant  account   transactions
processed before the Effective Time.

     "Proceeding"  shall mean any demand,  claim,  action or proceeding  made or
brought by a third party, including without limitation a government agency.

     "Processing Agreement(s)" shall mean those agreements on Schedule 1.01(g) .

     "Processor"  shall mean those  companies  with whom the Company has entered
into Processing Agreements listed on Schedule 1.01(h).

     "Purchase Price" shall have the meaning set forth in Section 1.05.

     "Real Property"  shall mean any parcel of real property,  together with the
improvements thereon, owned or leased by the Company.

     "Receivables" shall have the meaning set forth in Section 1.01(a).

     "Reserves" shall have the meaning set forth in Section 1.08.

     "Retained  Chargeback  Liability" shall mean those  Chargebacks  related to
Pre-Closing Transactions which are presented, identified, processed or for which
Buyer  receives  notice  within 6 months after the  Effective  Time in an amount
exceeding,  in  the  aggregate,   $60,000  with  respect  to  non-leasing/rental
activities,   and,  in  the   aggregate,   $10,000  with  respect  to  equipment
leasing/rental activities.

     "Seller  Indemnified  Parties"  shall have the meaning set forth in Section
9.01.

     "Seller  Indemnifying  Parties" shall have the meaning set forth in Section
9.01.

     "Sellers" shall have the meaning set forth in the introduction.

     "Settlement  Report"  shall mean the Company's  Visa/MasterCard  Settlement
Report.

                                       37
<PAGE>

     "Shareholder" shall have the meaning set forth in the introduction.

     "Shareholder Ancillary Documents" shall mean the agreements and instruments
(other  then this  Agreement)  to be executed  and  delivered  by a  Controlling
Shareholder pursuant to this Agreement.

     "Sponsor" shall have the meaning set forth in Section 3.16(g).

     "Sponsor  Bank(s)" shall mean the bank(s) with whom the Company has entered
into a Sponsorship Agreement listed on Schedule 1.01(h).

     "Sponsorship  Agreement(s)" shall mean those certain agreements on Schedule
1.01(h).

     "Stock" shall have the meaning set forth in Section 1.05(d).

     "Survival Period" shall have the meaning set forth in Section 11.15.

     "Tax" or "Taxes" shall mean all taxes, however  denominated,  including any
interest,  penalties  or other  additions  to taxes that may  become  payable in
respect thereof,  imposed by any federal,  territorial,  state, local or foreign
government or any agency or political subdivision of any such government,  which
taxes shall  include,  without  limiting the  generality of the  foregoing,  all
income or profits taxes (including, but not limited to, federal income taxes and
state  income  taxes),  payroll and  employee  withholding  taxes,  unemployment
insurance,  social security taxes, sales and use taxes, ad valorem taxes, excise
taxes, franchise taxes, gross receipts taxes, business license taxes, occupation
taxes,  personal  property taxes,  stamp taxes,  environmental  taxes,  transfer
taxes, workers' compensation, levies or assessments for unclaimed property under
applicable  escheat or unclaimed  property laws, taxes under the applicable bulk
sale statutes and other obligations of the same or of a similar nature to any of
the foregoing.

     "Tax Return" shall mean any report, return , declaration, claim for refund,
or information return or statement relating to Taxes,  including any schedule or
attachment thereto, and including any amendment thereof.

     "Visa" shall mean,  collectively,  Visa  International,  Inc. and Visa USA,
Inc.

                            [signature page follows]

                                       38
<PAGE>

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

                                iPAYMENT, INC.

                                By:
                                   ---------------------------------------------
                                Title:
                                      ------------------------------------------

                                CPS ACQUISITION, L.L.C.

                                By:    iPayment, Inc., its
                                                           ---------------------

                                       By:
                                           -------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                              ----------------------------------

                                CARDPAYMENT SOLUTIONS, INC.

                                By:
                                    --------------------------------------------
                                Title:
                                       -----------------------------------------


                                ------------------------------------------------
                                Zachary A. Hyman, Controlling Shareholder


                                ------------------------------------------------
                                Matthew B. Hyman, Controlling Shareholder

                                       39
<PAGE>

                              TABLE OF SCHEDULES*

1.01(a)        Company's Receivables
1.01(b)        Company's Inventory
1.01(c)        Owned Intellectual Property
1.01(d)        Tangible Personal Property
1.01(e)        Capitalized Leases
1.01(f)        Operating Leases
1.01(g)        Processing Agreement
1.01(h)        Sponsorship Agreement
1.01(j)        License Agreements
1.01(k)        Company's Contracts and Assumed Contracts
1.01(m)        Company's Prepaid Fees and Deposits
1.01(o)        Company's Merchants
1.02(b)        Amounts due to Company from Shareholders or other Affiliates
1.02(e)        Assets of Sellers
1.03(d)        Liabilities and Obligations of the Company
1.05(d)        Contingent Payments
1.07           Allocation of Purchase Price
3.01           Company's Certificate of Good Standing
3.02           Company's  Corporate  Powers;  Absence  of  Conflicts  With Other
               Agreements, etc.
3.03           Shareholder's   Capacity;   Absence  of   Conflicts   With  Other
               Agreements, etc.
3.04           Qualifications to Title to Assets
3.05           Company Shareholders
3.06           Company Subsidiaries
3.07           Financial Statements
3.07(e)        Qualifications to Preparation of Company's Financial Statements
3.08           Undisclosed Liabilities
3.09           Post-Balance Sheet Results
3.10(a)        Settlement Report
3.10(b)        Potential Merchant Cancellations
3.10(c)        Company's Merchant Information
3.11(a)        Outstanding Tax Matters
3.12(a)        Nondisclosed Company Contracts
3.12(b)        Company's Assumed Contracts Not in Full Force and Effect
3.14(a)        Employees and Independent Sales Representatives
3.14(b)(i)     Company's Employment Agreements
3.14(b)(ii)    Terminated Employees
3.14(c)        Independent Agents Intending to Terminate with Company
3.16           Employee Benefit Plans
3.16(l)        Company's Obligation to its Employees
3.16(m)        Former Employees who have elected COBRA Coverage
3.17           Litigation
3.18           Compliance Issues
3.19           Environmental Matters
3.20           Certain Payments
3.21           Conflict of Interest


---------------
*    See footnote on page 42 for an  explanation  of schedules not included with
     the  version of this  Agreement  filed  with the  Securities  and  Exchange
     Commission

                                       40
<PAGE>

3.22(c)        Non-Accredited Investors
3.24           Myisocenter, L.L.C. Members and Employees
3.25           Company's Knowledge of Fraud by Merchants
3.27(a)        Chargebacks
3.30           Ownership and Portability of Merchant Accounts
3.31           Retention Payments
3.33           Independent Agents Contracting with Company on Non-Standard Terms
4.01           Corporate Organization, etc.
4.02           Buyer's  Corporate  Powers;   Absence  of  Conflicts  With  Other
               Agreements
4.03           Holdings'  Corporate  Powers;  Absence  of  Conflicts  With Other
               Agreements, etc.
4.04           Subscription,  Warrant,  Option,  Convertible  Security  or Other
               Right to Purchase  or Acquire any Shares of the Capital  Stock of
               Holdings
4.06           Litigation
5.05           Consents to Assignment of all Assumed Contracts to Buyer
5.06           Termination or Merger of Employee Benefit Plans
6.04           Employee Agreements
8.01           Excluded Employees

                                       41
<PAGE>

                              TABLE OF EXHIBITS**

Exhibit        1.01(i) Merchant Agreements

Exhibit 2.02(a)                     Bill of Sale
Exhibit 2.02(b)                     Assignment and Assumption Agreement
Exhibit 2.02(c)                     Consent  to the Assignment of the Processing
                                    Agreement
Exhibit 2.02(d)                     Consent to the Assignment of the Sponsorship
                                    Agreement
Exhibit 2.02(f)                     Information Systems Transition Agreement
Exhibit 2.02(g)                     Company Non-Compete Agreement
Exhibit 2.02(h)                     Shareholder Non-compete Agreement
Exhibits 2.02(h)(i); 2.02 (h)(ii)   Employment Agreements

---------------
**   Pursuant to Item 601(b)(2) of Regulation S-K, the Company has not filed the
     Schedules (other than Schedule  1.05(d)),  nor Exhibits  1.01(i)  (Merchant
     Agreements),  2.02(a) (Bill of Sale),  2.02(b)  (Assignment  and Assumption
     Agreement),   2.02(c)   (Consent  to  the   Assignment  of  the  Processing
     Agreement),   2.02(d)   (Consent  to  the  Assignment  of  the  Sponsorship
     Agreement),  2.02(f)  Information  Systems  Transition  Agreement,  2.02(g)
     (Company   Non-compete   Agreement),   2.02(h)   (Shareholder   Non-compete
     Agreement) and Exhibits  2.02(h)(i) and (ii) (Employment  Agreements).  The
     Company  agrees to furnish  supplementally  to the  Securities and Exchange
     Commission  any  such  omitted  item and  reserves  the  right  to  request
     confidential treatment for any information contained therein.
<PAGE>

                                                                SCHEDULE 1.05(d)

                               CONTINGENT PAYMENTS

In addition to all other sums due Company under the Agreement,  Company shall be
entitled to receive from Buyer contingent compensation determined as follows:

     1. A total of Two Million  Dollars  ($2,000,000) if Buyer generates a total
of Five Thousand  Forty (5,040) New Active  Merchants (as defined  below) during
the Period (as defined below)

     2. An additional Five Hundred Thousand  Dollars  ($500,000) (for a total of
$2,500,000) if Buyer generates a total of Seven Thousand Two Hundred (7,200) New
Active Merchants (as defined below) during the Period (as defined below)

     3. An additional Five Hundred Thousand  Dollars  ($500,000) (for a total of
$3,000,000) if Buyer  generates a total of Nine Thousand Six Hundred (9,600) New
Active Merchants (as defined below) during the Period (as defined below)

     For purposes of this Schedule 1.5(d) "New Active Merchant" shall mean a new
merchant application that is Approved by iPayment,  was not at the time that the
application was being  processed or immediately  prior thereto a merchant of the
Company (or iPayment or any of iPayment's subsidiaries),  and which has at least
one month of  Visa/Mastercard  processing  transactions.  For  purposes  of this
Schedule  1.5(d),  "Approved" shall mean that such merchant has a risk profile &
pricing acceptable to iPayment.  For purposes of this Schedule 1.5(d),  "Period"
shall  mean the date  which  begins as of August 1, 2003 and ends as of July 31,
2004. The aggregate  maximum payment that may be earned as a contingent  payment
under this Schedule  1.5(d) is  $3,000,000.  Any  Contingent  Payment  earned by
Company  under  this  Schedule  1.5(d)  shall  be all due and  payable  within a
reasonable  time after  confirmation  of the aggregate  number of the New Active
Merchants  that have been added  during the  Period,  but in no event shall said
amount be paid prior to August 1, 2004 or later than September 30, 2004.