EXHIBIT 10.60

                      REIMBURSEMENT AND INDEMNITY AGREEMENT

This Agreement, dated January 15, 2002, is by and between Luiz Claudio Valdetaro
Galvao e Mello ("Valdetaro") and Vertical Computer Systems, Inc. ("VCSY").

WHEREAS,  VCSY has agreed to reimburse  and  indemnify  Valdetaro  for any costs
incurred by Valdetaro with respect to the loan  transaction made on December 14,
2001  (the  "Loan")  made  between  VCSY  and  the  Brighton   Opportunity  Fund
("Brighton").

WHEREAS,  Valdetaro,  in connection with the Loan,  pledged 15,000,000 shares of
VCSY common  stock owned by Valdetaro  (the  "Valdetaro  Shares") as  collateral
pursuant to the Valdetaro Pledge Agreement to induce Brighton to make the Loan.

WHEREAS, it is the intention of the parties that in the event of any default and
sale of any Valdetaro Shares that Valdetaro shall receive replacement shares and
reimbursement  of any costs,  including  taxes,  for  selling or  receiving  the
replacement shares.

THEREFORE, the parties hereby confirm their agreements as follows:

1. In the event of that VCSY  defaults  on the Loan for which  Valdetaro  Shares
have been pledged as collateral  and any  Valdetaro  Shares are sold pursuant to
the Valdetaro pledge agreement, VCSY shall:

      a. issue a number of new  shares of VCSY  common  stock (the  "Replacement
      Shares")  equal to the number of the  Valdetaro  shares  actually  sold by
      Brighton (or its designee) pursuant to Valdetaro's pledge agreement .

      b. use its best  efforts  to (i) cause  any  Replacement  Shares  that are
      issued to be freely tradable and without restriction to Valdetaro and (ii)
      register the Replacement Shares with the Securities Exchange Commission.

      c.  reimburse  Valdetaro for any costs or expenses in connection  with the
      sale of any  Valdetaro  shares or the issuance by VCSY of any  Replacement
      Shares. Such reimbursement of expenses shall include,  without limitation,
      any tax  consequences  (federal,  state,  and local, if any) and brokerage
      fees.  Valdetaro shall provide all documentation  reasonably  necessary in
      order for VCSY to reimburse Valdetaro.


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2. VCSY shall defend,  protect,  indemnify and hold harmless  Valdetaro from and
against any and all actions,  causes of action,  suits, claims,  losses,  costs,
penalties,  fees,  liabilities and damages,  and expenses in connection with the
Loan for which Valdetaro pledged the Valdetaro Shares as collateral to Brighton,
including  reasonable   attorneys'  fees  and  disbursements  (the  "Indemnified
Liabilities"),  incurred  by  Valdetaro  as a result of, or  arising  out of, or
relating  to (a)  any  misrepresentation  or  breach  of any  representation  or
warranty made by VCSY with regard to the Loan for which the Valdetaro Shares are
pledged, or any other certificate, instrument or document contemplated hereby or
thereby, (b) any breach of any covenant, agreement or obligation of VCSY in this
Agreement or any other certificate,  instrument or document  contemplated hereby
or thereby,  or (c) any cause of action,  suit or claim  brought or made against
Valdetaro  and  arising  out  of or  resulting  from  the  execution,  delivery,
performance or enforcement of this Agreement or any other  instrument,  document
or agreement executed pursuant hereto by Valdetaro,  any transaction financed or
to be financed in whole or in part, directly or indirectly, with the proceeds of
the  issuance  of the  Loan in  which  the  Valdetaro  shares  were  pledged  as
collateral.  To the  extent  that  the  foregoing  undertaking  by  VCSY  may be
unenforceable  for any reason,  VCSY shall make the maximum  contribution to the
payment  and  satisfaction  of each of the  Indemnified  Liabilities,  which  is
permissible under applicable law.

The parties hereby agree to the foregoing on the date first set forth above.


Accepted and Agreed to by:

"Valdetaro"


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Luiz Claudio Valdetaro Galvao e Mello


Accepted and Agreed to by:
"VCSY"


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Richard Wade
President, Vertical Computer Systems, Inc.