exv10w1






EXHIBIT 10.1




FORM OF INDEMNIFICATION AGREEMENT




          THIS INDEMNIFICATION AGREEMENT (this “Agreement”) is made and entered into as of ____________,
20__ between IPAYMENT, INC., a Delaware corporation (the “Company”), and ____________
(“Indemnitee”). Capitalized terms not defined elsewhere in this Agreement are used as defined in
Section 12.



WITNESSETH:




     WHEREAS, Indemnitee performs a valuable service for the Company;



     WHEREAS, the by-laws of the Company (as they may be amended from time to time, the “By-Laws”)
require indemnification of the officers and directors of the Company;



     WHEREAS, this Agreement is a supplement to and in furtherance of the By-Laws and any
resolutions adopted pursuant thereto, and shall not be deemed a substitute therefor, nor to
diminish or abrogate any rights of Indemnitee thereunder;



     WHEREAS, the By-Laws and the General Corporation Law of the State of Delaware (as it may be
amended from time to time, the “DGCL”), by their nonexclusive nature, permit contracts between the
Company and the officers or directors of the Company with respect to indemnification of such
officers or directors; and



     WHEREAS, in order to induce Indemnitee to serve as an officer and/or director of the Company,
the Company has determined and agreed to enter into this contract with and for the benefit of
Indemnitee.



     NOW, THEREFORE, in consideration of Indemnitee’s agreement to serve as an officer and/or
director from and after the date hereof, the parties hereto agree as follows:



          1. Indemnity of Indemnitee. The Company hereby agrees as set forth herein to hold
harmless and indemnify Indemnitee to the fullest extent permitted by applicable laws, as such may
be amended from time to time. In furtherance of the foregoing indemnification, and without
limiting the generality thereof:




               (a) Proceedings Other Than Proceedings by or in the Right of the Company. Indemnitee
shall be entitled to the rights of indemnification provided in this Section l(a) if, by
reason of his Corporate Status, Indemnitee is, or is threatened to be made, a party to or
participant in any Proceeding other than a Proceeding by or in the right of the Company. Pursuant
to this Section 1(a), Indemnitee shall be indemnified against all Expenses, judgments,
penalties, fines and amounts paid in settlement actually and reasonably incurred by him, or on his
behalf, in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee
acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the
best interests of the Company, and with respect to any criminal Proceeding, had no reasonable cause
to believe Indemnitee’s conduct was unlawful.



 









 





               (b) Proceedings by or in the Right of the Company. Indemnitee shall be entitled to
the rights of indemnification provided in this Section 1(b) if, by reason of his Corporate
Status, Indemnitee is, or is threatened to be made, a party to or participant in any Proceeding
brought by or in the right of the Company. Pursuant to this Section 1(b), Indemnitee shall
be indemnified against all Expenses actually and reasonably incurred by Indemnitee, or on
Indemnitee’s behalf, in connection with such Proceeding if Indemnitee acted in good faith and in a
manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company;
provided, however, if applicable laws so provide, no indemnification against such Expenses shall be
made in respect of any claim, issue or matter in such Proceeding as to which Indemnitee shall have
been adjudged to be liable to the Company unless and to the extent that the Court of Chancery of
the State of Delaware (the “Delaware Court”) shall determine that such indemnification may be made.



               (c) Indemnification for Expenses of a Party Who is Wholly or Partly Successful.
Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason
of his Corporate Status, a party to and is successful, on the merits or otherwise, in any
Proceeding, he shall be indemnified to the maximum extent permitted by applicable laws, as such may
be amended from time to time, against all Expenses actually and reasonably incurred by him or on
his behalf in connection therewith. If Indemnitee is not wholly successful in such Proceeding but
is successful, on the merits or otherwise, as to one or more but less than all claims, issues or
matters in such Proceeding, the Company shall indemnify Indemnitee against all Expenses actually
and reasonably incurred by him or on his behalf in connection with each successfully resolved
claim, issue or matter. For purposes of this Section 1(c) and without limitation, the
termination of any claim, issue or matter in such a Proceeding by dismissal, with or without
prejudice, shall be deemed to be a successful result as to such claim, issue or matter.



          2. Additional Indemnity. In addition to, and without regard to any limitations on,
the indemnification provided for in Section 1 of this Agreement, the Company shall and
hereby does indemnify and hold harmless Indemnitee against all Expenses, judgments, penalties,
fines and amounts paid in settlement actually and reasonably incurred by him or on his behalf if,
by reason of his Corporate Status, he is, or is threatened to be made, a party to or participant in
any Proceeding (including, without limitation, a Proceeding by or in the right of the Company),
including, without limitation, all liability arising out of the negligence or active or passive
wrongdoing of Indemnitee. The only limitation that shall exist upon the Company’s obligations
pursuant to this Agreement shall be that the Company shall not be obligated to make any payment to
Indemnitee that is finally determined (under the procedures, and subject to the presumptions, set
forth in Sections 6 and 7 hereof) to be unlawful.




          3. Contribution.




               (a) Whether or not the indemnification provided in Sections 1 and 2 hereof is
available, in respect of any threatened, pending or completed action, suit or proceeding in which
the Company is jointly liable with Indemnitee (or would be so liable if joined in such action, suit
or proceeding), the Company shall pay, in the first instance, the entire amount of any judgment or
settlement of such action, suit or proceeding without requiring Indemnitee to contribute to such
payment and the Company hereby waives and relinquishes any right of contribution it may have
against Indemnitee. The Company shall not, without Indemnitee’s prior



2









 




written consent, enter into any settlement (in whole or in part) of any action, suit or
proceeding in which the Company is jointly liable with Indemnitee (or would be so liable if joined
in such action, suit or proceeding) unless such settlement (i) provides for a full and final
release of all claims asserted against Indemnitee and (ii) does not impose any Expense, judgment,
fine or penalty (not otherwise borne by the Company pursuant to the terms hereof) or any limitation
on Indemnitee.




               (b) Without diminishing or impairing the obligations of the Company set forth in the preceding
paragraph, if, for any reason, Indemnitee shall elect or be required to pay all or any portion of
any judgment or settlement in any threatened, pending or completed action, suit or proceeding in
which the Company is jointly liable with Indemnitee (or would be so liable if joined in such
action, suit or proceeding), the Company shall contribute to the amount of Expenses, judgments,
fines and amounts paid in settlement actually and reasonably incurred and paid or payable by
Indemnitee in proportion to the relative benefits received by the Company and all officers,
directors or employees of the Company, other than Indemnitee, who are jointly liable with
Indemnitee (or would be so liable if joined in such action, suit or proceeding), on the one hand,
and Indemnitee, on the other hand, from the transaction or events from which such action, suit or
proceeding arose; provided, however, that the proportion determined on the basis of relative
benefit may, to the extent necessary to conform to applicable laws, be further adjusted by
reference to the relative fault of the Company and all officers, directors or employees of the
Company other than Indemnitee who are jointly liable with Indemnitee (or would be so liable if
joined in such action, suit or proceeding), on the one hand, and Indemnitee, on the other hand, in
connection with the transaction or events that resulted in such expenses, judgments, fines or
settlement amounts, as well as any other equitable considerations which applicable laws may require
to be considered. The relative fault of the Company and all officers, directors or employees of
the Company, other than Indemnitee, who are jointly liable with Indemnitee (or would be so liable
if joined in such action, suit or proceeding), on the one hand, and Indemnitee, on the other hand,
shall be determined by reference to, among other things, the degree to which their actions were
motivated by intent to gain personal profit or advantage, the degree to which their liability is
primary or secondary and the degree to which their conduct is active or passive.



               (c) The Company hereby agrees to fully indemnify and hold Indemnitee harmless from any claims
of contribution which may be brought by officers, directors or employees of the Company, other than
Indemnitee, who may be jointly liable with Indemnitee.



               (d) To the fullest extent permissible under applicable laws, if the indemnification provided
for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu
of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee, whether for
judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for
Expenses, in connection with any claim relating to an indemnifiable event under this Agreement, in
such proportion as is deemed fair and reasonable in light of all of the circumstances of such
Proceeding in order to reflect (i) the relative benefits received by the Company and Indemnitee as
a result of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or (ii) the
relative fault of the Company (and its directors, officers, employees and agents) and Indemnitee in
connection with such event(s) and/or transaction(s).



3









 





          4. Indemnification for Expenses of a Witness. Notwithstanding any other provision of
this Agreement, to the extent that Indemnitee is, by reason of his Corporate Status, a witness, or
is made (or asked) to respond to discovery requests, in any Proceeding to which Indemnitee is not a
party, he shall be indemnified against all Expenses actually and reasonably incurred by him or on
his behalf in connection therewith.




          5. Advancement of Expenses. Notwithstanding any other provision of this Agreement,
the Company shall advance all Expenses incurred by or on behalf of Indemnitee in connection with
any Proceeding by reason of Indemnitee’s Corporate Status within thirty (30) days after the receipt
by the Company of a statement or statements from Indemnitee requesting such advance or advances
from time to time, whether prior to or after final disposition of such Proceeding. Such statement
or statements shall reasonably evidence the Expenses incurred by Indemnitee and shall include or be
preceded or accompanied by a written undertaking by or on behalf of Indemnitee to repay any
Expenses advanced if it shall ultimately be determined that Indemnitee is not entitled to be
indemnified against such Expenses. Any advances and undertakings to repay pursuant to this
Section 5 shall be unsecured and interest free.




          6. Procedures and Presumptions for Determination of Entitlement to Indemnification.
It is the intent of this Agreement to secure for Indemnitee rights of indemnity that are as
favorable as may be permitted under the DGCL and public policy of the State of Delaware.
Accordingly, the parties agree that the following procedures and presumptions shall apply in the
event of any question as to whether Indemnitee is entitled to indemnification under this Agreement:




               (a) To obtain indemnification under this Agreement, Indemnitee shall submit to the Company a
written request, including therein or therewith such documentation and information as is reasonably
available to Indemnitee and is reasonably necessary to determine whether and to what extent
Indemnitee is entitled to indemnification. The Secretary of the Company shall, promptly upon
receipt of such a request for indemnification, advise the Board of Directors of the Company (the
“Board”) in writing that Indemnitee has requested indemnification. Notwithstanding the foregoing,
any failure of Indemnitee to provide such a request to the Company, or to provide such a request in
a timely fashion, shall not relieve the Company of any liability that it may have to Indemnitee
unless, and to the extent that, such failure actually and materially prejudices the interests of
the Company.



               (b) Upon written request by Indemnitee for indemnification pursuant to the first sentence of
Section 6(a) hereof, a determination with respect to Indemnitee’s entitlement thereto shall
be made in the specific case by one of the following four methods, which shall be at the election
of the Board: (1) by a majority vote of the Disinterested Directors, even though less than a
quorum, (2) by a committee of Disinterested Directors designated by a majority vote of the
Disinterested Directors, even though less than a quorum, (3) if there are no Disinterested
Directors or if the Disinterested Directors so direct, by Independent Counsel in a written opinion
to the Board, a copy of which shall be delivered to Indemnitee or (4) by the stockholders of the
Company.



               (c) If the determination of entitlement to indemnification is to be made by Independent
Counsel pursuant to Section 6(b) hereof, the Independent Counsel shall be selected as
provided in this Section 6(c). The Independent Counsel shall be selected by the



4









 




Board, and the Company shall give written notice to the Indemnitee advising him of the
identity of the Independent Counsel so selected. Indemnitee may, within ten (10) days after such
written notice of selection shall have been given, deliver to the Company a written objection to
such selection; provided, however, that such objection may be asserted only on the ground that the
Independent Counsel so selected does not meet the requirements of “Independent Counsel” as defined
in Section 12 of this Agreement, and the objection shall set forth with particularity the
factual basis of such assertion. Absent a proper and timely objection, the person so selected
shall act as Independent Counsel. If a written objection is made and substantiated, the
Independent Counsel selected may not serve as Independent Counsel unless and until such objection
is withdrawn or a court has finally determined that such objection is without merit. If, within
twenty (20) days after submission by Indemnitee of a written request for indemnification pursuant
to Section 6(a) hereof, no Independent Counsel shall have been selected and not objected
to, either the Company or Indemnitee may petition the Delaware Court or other court of competent
jurisdiction for resolution of any objection which shall have been made by Indemnitee to the
Company’s selection of Independent Counsel and/or for the appointment as Independent Counsel of a
person selected by the court or by such other person as the court shall designate, and the person
with respect to whom all objections are so resolved or the person so appointed shall act as
Independent Counsel under Section 6(b) hereof. The Company shall pay any and all
reasonable fees and expenses of Independent Counsel incurred by such Independent Counsel in
connection with acting pursuant to Section 6(b) hereof, and the Company shall pay all
reasonable fees and expenses incident to the procedures of this Section 6(c), regardless of
the manner in which such Independent Counsel was selected or appointed.




               (d) In making a determination with respect to entitlement to indemnification hereunder, the
person or persons or entity making such determination shall presume that Indemnitee is entitled to
indemnification under this Agreement. Anyone seeking to overcome this presumption shall have the
burden of proof and the burden of persuasion by clear and convincing evidence. Neither the failure
of the Company (including, without limitation, by its directors or legal counsel) to have made a
determination prior to the commencement of any action pursuant to this Agreement that
indemnification is proper in the circumstances because Indemnitee has met the applicable standard
of conduct, nor an actual determination by the Company (including, without limitation, by its
directors or legal counsel) that Indemnitee has not met such applicable standard of conduct, shall
be a defense to the action or create a presumption that Indemnitee has not met the applicable
standard of conduct.



               (e) Indemnitee shall be deemed to have acted in good faith if Indemnitee’s action is based on
the records or books of account of the Enterprise, including, without limitation, financial
statements, or on information supplied to Indemnitee by the officers of the Enterprise in the
course of their duties, or on the advice of legal counsel for the Enterprise or on information or
records given or reports made to the Enterprise by an independent certified public accountant or by
an appraiser or other expert selected with reasonable care by the Enterprise. In addition, the
knowledge and/or actions, or failure to act, of any director, officer, agent or employee of the
Enterprise (other than Indemnitee) shall not be imputed to Indemnitee for purposes of determining
the right to indemnification under this Agreement. Whether or not the foregoing provisions of this
Section 6(e) are satisfied, it shall in any event be presumed that Indemnitee has at all
times acted in good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the Company. Anyone seeking to overcome this presumption shall have the burden
of proof and the burden of persuasion by clear and convincing evidence.



5









 





               (f) If the person, persons or entity empowered or selected under this Section 6 to
determine whether Indemnitee is entitled to indemnification shall not have made a determination
within sixty (60) days after receipt by the Company of the request therefor, the requisite
determination of entitlement to indemnification shall be deemed to have been made and Indemnitee
shall be entitled to such indemnification absent (i) a misstatement by Indemnitee of a material
fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially
misleading, in connection with the request for indemnification, or (ii) a prohibition of such
indemnification under applicable laws.



               (g) Indemnitee shall cooperate with the person, persons or entity making such determination
with respect to Indemnitee’s entitlement to indemnification, including, without limitation,
providing to such person, persons or entity upon reasonable advance request any documentation or
information which is not privileged or otherwise protected from disclosure and which is reasonably
available to Indemnitee and reasonably necessary to such determination. Any Independent Counsel,
member of the Board or stockholder of the Company shall act reasonably and in good faith in making
a determination regarding Indemnitee’s entitlement to indemnification under this Agreement. Any
costs or expenses (including, without limitation, attorneys’ fees and disbursements) reasonably
incurred by Indemnitee in so cooperating with the person, persons or entity making such
determination shall be borne by the Company (irrespective of the determination as to Indemnitee’s
entitlement to indemnification) and the Company hereby indemnifies and agrees to hold Indemnitee
harmless therefrom.



               (h) The Company acknowledges that a settlement or other disposition short of final judgment
may be successful if it permits a party to avoid expense, delay, distraction, disruption and
uncertainty. In the event that any action, claim or proceeding to which Indemnitee is a party is
resolved in any manner other than by adverse judgment against Indemnitee (including, without
limitation, settlement of such action, claim or proceeding with or without payment of money or
other consideration) it shall be presumed that Indemnitee has been successful on the merits or
otherwise in such action, suit or proceeding. Anyone seeking to overcome this presumption shall
have the burden of proof and the burden of persuasion by clear and convincing evidence.



               (i) The termination of any Proceeding or of any claim, issue or matter therein, by judgment,
order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not
(except as otherwise expressly provided in this Agreement) of itself adversely affect the right of
Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and
in a manner which he reasonably believed to be in or not opposed to the best interests of the
Company or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to
believe that his conduct was unlawful.



          7. Remedies of Indemnitee.




               (a) In the event that (i) a determination is made pursuant to Section 6 of this
Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement
of Expenses is not timely made pursuant to Section 5 of this Agreement, (iii) no
determination of entitlement to indemnification is made pursuant to Section 6(b) of this
Agreement within sixty (60) days after receipt by the Company of the request for



6









 




indemnification, (iv) payment of indemnification is not made pursuant to this Agreement within
thirty (30) days after receipt by the Company of a written request therefor or (v) payment of
indemnification is not made within ten (10) days after a determination has been made that
Indemnitee is entitled to indemnification or such determination is deemed to have been made
pursuant to Section 6 of this Agreement, Indemnitee shall be entitled to an adjudication in
an appropriate court of the State of Delaware, or in any other court of competent jurisdiction, of
Indemnitee’s entitlement to such indemnification, contribution or advancement of Expenses.
Alternatively, Indemnitee, at his option, may seek an award in arbitration to be conducted by a
single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration
Association. Except as set forth herein, the provisions of Delaware law (without regard to its
conflict of law rules) shall apply to any such arbitration. Indemnitee shall commence such
proceeding seeking an adjudication or an award in arbitration within one hundred eighty (180) days
following the date on which Indemnitee first has the right to commence such proceeding pursuant to
this Section 7(a). The Company shall not oppose Indemnitee’s right to seek any such
adjudication or award in arbitration.




               (b) In the event that a determination shall have been made pursuant to Section 6(b) of
this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding or
arbitration commenced pursuant to this Section 7 shall be conducted in all respects as a de
novo proceeding or arbitration on the merits, and Indemnitee shall not be prejudiced by reason of
the adverse determination under Section 6(b). In any judicial proceeding or arbitration
commenced pursuant to this Section 7, Indemnitee shall be presumed to be entitled to
indemnification under this Agreement and the Company shall have the burden of proving Indemnitee is
not entitled to indemnification or advancement of Expenses, as the case may be, and the Company may
not refer to or introduce into evidence any determination pursuant to Section 6(b) of this
Agreement adverse to Indemnitee for any purpose. If Indemnitee commences a judicial proceeding or
arbitration pursuant to this Section 7, Indemnitee shall not be required to reimburse the
Company for any advances pursuant to Section 5 until a final determination is made with
respect to Indemnitee’s entitlement to indemnification (as to which all rights of appeal have been
exhausted or lapsed).



               (c) If a determination shall have been made pursuant to Section 6(b) of this Agreement
that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in
any judicial proceeding commenced pursuant to this Section 7, absent (i) a misstatement by
Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s
misstatement not materially misleading in connection with the application for indemnification, or
(ii) a prohibition of such indemnification under applicable laws.



               (d) In the event that Indemnitee, pursuant to this Section 7, seeks a judicial
adjudication of his rights under, or to recover damages for breach of, this Agreement, or to
recover under any directors’ and officers’ liability insurance policies maintained by the Company,
the Company shall pay on his behalf, in advance, any and all Expenses actually and reasonably
incurred by him in such judicial adjudication, regardless of whether Indemnitee ultimately is
determined to be entitled to such indemnification, advancement of expenses or insurance recovery.



               (e) The Company shall be precluded from asserting in any judicial proceeding commenced
pursuant to this Section 7 that the procedures and presumptions of this



7









 




Agreement are not valid, binding and enforceable and shall stipulate in any such court that
the Company is bound by all the provisions of this Agreement. The Company shall indemnify
Indemnitee against any and all Expenses and, if requested by Indemnitee, shall (within thirty (30)
days after receipt by the Company of a written request therefor) advance, to the extent not
prohibited by applicable laws, such expenses to Indemnitee, which are incurred by Indemnitee in
connection with any action brought by Indemnitee for indemnification or advance of Expenses from
the Company under this Agreement or under any directors’ and officers’ liability insurance policies
maintained by the Company, regardless of whether Indemnitee ultimately is determined to be entitled
to such indemnification, advancement of Expenses or insurance recovery, as the case may be.




               (f) Notwithstanding anything in this Agreement to the contrary, no determination as to
entitlement to indemnification under this Agreement shall be required to be made prior to the final
disposition of the Proceeding.



          8. Non-Exclusivity; Survival of Rights; Insurance; Primacy of Indemnification;
Subrogation.




               (a) The rights of indemnification and to receive advancement of expenses as provided by this
Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be
entitled under applicable laws, the By-Laws, any agreement, a vote of stockholders, a resolution of
the Board, or otherwise. No supplement, modification, termination or amendment of this Agreement
or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in
respect of any action taken or omitted by such Indemnitee in his Corporate Status prior to such
supplement, modification, termination or amendment. To the extent that a change in the DGCL,
whether by statute or judicial decision, permits greater indemnification than would be afforded
currently under the By-Laws and this Agreement, it is the intent of the parties hereto that
Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change. No right
or remedy herein conferred is intended to be exclusive of any other right or remedy, and every
other right and remedy shall be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other right or remedy.



               (b) To the extent that the Company maintains an insurance policy or policies providing
liability insurance for directors, officers, employees, or agents or fiduciaries of the Company or
of any other Enterprise, Indemnitee shall be covered by such policy or policies in accordance with
its or their terms to the maximum extent of the coverage available for any director, officer,
employee, agent or fiduciary of the Company or of any other Enterprise under such policy or
policies. If, at the time of the receipt of a notice of a claim pursuant to the terms hereof, the
Company has directors’ and officers’ liability insurance in effect, the Company shall give prompt
notice of the commencement of such proceeding to the insurers in accordance with the procedures set
forth in the respective policies. The Company shall thereafter take all necessary action to cause
such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such proceeding
in accordance with the terms of such policies.



               (c) In the event of any payment under this Agreement, the Company shall be subrogated to the
extent of such payment to all of the rights of recovery of Indemnitee,



8









 




who shall execute all papers required and take all necessary action to secure such rights,
including, without limitation, execution of such documents as are necessary to enable the Company
to bring suit to enforce such rights.




               (d) The Company shall not be liable under this Agreement to make any payment of amounts
otherwise indemnifiable hereunder if and to the extent that Indemnitee has otherwise actually
received such payment under any insurance policy, contract, agreement or otherwise.



               (e) The Company’s obligation to indemnify or advance Expenses hereunder to Indemnitee who is
or was serving at the request of the Company as a director, officer, employee or agent of any other
Enterprise shall be reduced by any amount Indemnitee has actually received as indemnification or
advancement of expenses from such other Enterprise.



          9. Exception to Right of Indemnification. Notwithstanding any provision in this
Agreement, the Company shall not be obligated under this Agreement to make any indemnity in
connection with any claim made against Indemnitee:




               (a) for which payment has actually been made to or on behalf of Indemnitee under any insurance
policy or other indemnity provision, except with respect to any excess beyond the amount paid under
any insurance policy or other indemnity provision;



               (b) for an accounting of profits made from the purchase and sale (or sale and purchase) by
Indemnitee of securities of the Company within the meaning of Section 16(b) of the Exchange
Act or similar provisions of state statutory law or common law;



               (c) for reimbursement to the Company of any bonus or other incentive-based or
equity-based compensation or of any profits realized by Indemnitee from the sale of securities of
the Company in each case as required under the Exchange Act; or



               (d) in connection with any Proceeding (or any part of any Proceeding) initiated by Indemnitee,
including, without limitation, any Proceeding (or any part of any Proceeding) initiated by
Indemnitee against the Company or its directors, officers, employees or other indemnitees, unless
(i) the Company has joined in, or the Board has authorized, the Proceeding (or any part of any
Proceeding) prior to its initiation, (ii) the Company provides the indemnification, in its sole
discretion, pursuant to the powers vested in the Company under applicable laws or (iii) the
Proceeding is one to enforce Indemnitee’s rights under this Agreement.



          10. Duration of Agreement. All agreements and obligations of the Company contained
herein shall continue during the period Indemnitee is an officer and/or director of the Company (or
is or was serving at the request of the Company as a director, officer, employee or agent of
another Enterprise) and for ten (10) years thereafter, and shall continue thereafter so long as
Indemnitee shall be subject to any Proceeding (or any proceeding commenced under Section 7
hereof) by reason of his Corporate Status, whether or not he is acting or serving in any such
capacity at the time any liability or expense is incurred for which indemnification can be provided
under this Agreement.





9









 








          11. Security. To the extent requested by Indemnitee and approved by the Board in its
sole discretion, the Company may at any time and from time to time provide security to Indemnitee
for the Company’s obligations hereunder through an irrevocable bank line of credit, funded trust or
other collateral. Any such security, once provided to Indemnitee, may not be revoked or released
without the prior written consent of Indemnitee.




          12. Definitions. For purposes of this Agreement:




               (a) “Corporate Status” means the status of a person who is or was a director, officer,
employee, agent or fiduciary of the Company or of any other Enterprise.



               (b) “Disinterested Director” means a director of the Company who is not and was not a party to
the Proceeding in respect of which indemnification is sought by Indemnitee.



               (c) “Enterprise” means the Company and any other corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise that Indemnitee is or was serving at the request
of the Company as a director, officer, employee, agent or fiduciary.



               (d) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.



               (e) “Expenses” means all reasonable attorneys’ fees, retainers, court costs, transcript costs,
fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs,
telephone charges, postage, delivery service fees and all other disbursements or expenses of the
types customarily incurred in connection with prosecuting, defending, preparing to prosecute or
defend, investigating, participating, or being or preparing to be a witness in a Proceeding, or
responding to, or objecting to, a request to provide discovery in any Proceeding. Expenses also
shall include Expenses incurred in connection with any appeal resulting from any Proceeding and any
federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed
receipt of any payments under this Agreement, including, without limitation, the premium, security
for, and other costs relating to any cost bond, supersede as bond, or other appeal bond or its
equivalent. Expenses, however, shall not include amounts paid in settlement by Indemnitee or the
amount of judgments or fines against Indemnitee.



               (f) “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in
matters of corporation law and neither presently is, nor in the past five years has been, retained
to represent: (i) the Company or Indemnitee in any matter material to either such party (other
than with respect to matters concerning Indemnitee under this Agreement, or of other indemnitees
under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to
a claim for indemnification hereunder. Notwithstanding the foregoing, the term “Independent
Counsel” shall not include any person who, under the applicable standards of professional conduct
then prevailing, would have a conflict of interest in representing either the Company or Indemnitee
in an action to determine Indemnitee’s rights under this Agreement. The Company agrees to pay the
reasonable fees and expenses of the Independent Counsel referred to above and to fully indemnify
such counsel against any and all



10









 




Expenses, claims, liabilities and damages arising out of or relating to this Agreement or its
engagement pursuant hereto.




               (g) “Proceeding” means any threatened, pending or completed action, suit, arbitration,
alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other
actual, threatened or completed proceeding, whether brought by or in the right of the Company or
otherwise and whether civil, criminal, administrative or investigative, in which Indemnitee was, is
or will be involved as a party or otherwise, by reason of his Corporate Status, by reason of any
action taken by him or of any inaction on his part while acting in his Corporate Status, in each
case whether or not he is acting or serving in any such capacity at the time any liability or
expense is incurred for which indemnification can be provided under this Agreement, including,
without limitation, one pending on or before the date of this Agreement, but excluding one
initiated by an Indemnitee pursuant to Section 7 of this Agreement to enforce his rights
under this Agreement.



          13. Severability. If any provision or provisions of this Agreement shall be held to
be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality, and
enforceability of the remaining provisions of this Agreement (including, without limitation, each
portion of any section, paragraph or sentence of this Agreement containing any such provision held
to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable)
shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest
extent permitted by applicable laws; (b) such provision or provisions shall be deemed reformed to
the fullest extent necessary to conform to applicable laws and to give the maximum effect to the
intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this
Agreement (including, without limitation, each portion of any Section, paragraph or sentence of
this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is
not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent
manifested thereby. Without limiting the generality of the foregoing, this Agreement is intended to
confer upon Indemnitee indemnification rights to the fullest extent permitted by applicable laws.




          14. Enforcement and Binding Effect.




               (a) The Company expressly confirms and agrees that it has entered into this Agreement and
assumes the obligations imposed on it hereby in order to induce Indemnitee to serve as an officer
and/or director of the Company, and the Company acknowledges that Indemnitee is relying upon this
Agreement in serving as an officer and/or director of the Company.



               (b) Without limiting any of the rights of Indemnitee under the By-Laws and, if applicable, the
Certificate of Incorporation of the Company (as it may be amended from time to time), this
Agreement constitutes the entire agreement between the parties hereto with respect to the subject
matter hereof and supersedes all prior agreements (including, without limitation, any
indemnification agreement) and understandings, oral, written and implied, between the parties
hereto with respect to the subject matter hereof.



11









 





               (c) The Company shall not seek from a court, or agree to, a “bar order” which would
have the effect of prohibiting or limiting Indemnitee’s rights to receive advancement of expenses
under this Agreement.



               (d) This Agreement shall be binding upon and be enforceable by the parties hereto and their
respective successors and assigns (including, without limitation, any direct or indirect successor
by purchase, merger, consolidation or otherwise to all or substantially all of the business or
assets of the Company), shall continue as to an Indemnitee who has ceased to be a director,
officer, employee or agent of the Company or of any other Enterprise at the Company’s request, and
shall inure to the benefit of Indemnitee and his spouse, assigns, heirs, devisees, executors and
administrators and other legal representatives.



               (e) The Company shall require and cause any successor (whether direct or indirect by purchase,
merger, consolidation or otherwise) to all, substantially all or a substantial part, of the
business and/or assets of the Company to expressly to assume and agree to perform this Agreement in
the same manner and to the same extent that the Company would be required to perform if no such
succession had taken place.



               (f) The Company and Indemnitee agree herein that a monetary remedy for breach of this
Agreement, at some later date, may be inadequate, impracticable and difficult to prove, and further
agree that such breach may cause Indemnitee irreparable harm. Accordingly, the parties hereto agree
that Indemnitee may enforce this Agreement by seeking injunctive relief and/or specific performance
hereof, without any necessity of showing actual damage or irreparable harm and that by seeking
injunctive relief and/or specific performance, Indemnitee shall not he precluded from seeking or
obtaining any other relief to which he may be entitled. The Company and Indemnitee further agree
that Indemnitee shall be entitled to such specific performance and injunctive relief, including,
without limitation, temporary restraining orders, preliminary injunctions and permanent
injunctions, without the necessity of posting bonds or other undertakings in connection therewith.
The Company acknowledges that in the absence of a waiver, a bond or undertaking may be required of
Indemnitee by the Court, and the Company hereby waives any such requirement of such a bond or
undertaking.



          15. Modification and Waiver. No supplement, modification, termination or amendment of
this Agreement shall be binding unless executed in writing by both of the parties hereto. No
waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of
any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing
waiver.




          16. Notice By Indemnitee. Indemnitee agrees to promptly notify the Company in writing
upon being served with or otherwise receiving any summons, citation, subpoena, complaint,
indictment, information or other document relating to any Proceeding or matter which may be subject
to indemnification covered hereunder. The failure to so notify the Company shall not relieve the
Company of any obligation which it may have to Indemnitee under this Agreement or otherwise, unless
and only to the extent that such failure or delay materially prejudices the Company.




          17. Notices. All notices and other communications given or made pursuant to this
Agreement shall be in writing and shall be deemed effectively given: (a) upon personal






12









 







delivery to the party to be notified, (b) when sent by confirmed electronic mail or facsimile
if sent during normal business hours of the recipient, and if not so confirmed, then on the next
business day, (c) five (5) days after having been sent by registered or certified mail, return
receipt requested, postage prepaid, or (d) one (1) day after deposit with a nationally recognized
overnight courier, specifying next day delivery, with written verification of receipt. All
communications shall be sent:




               (a) To Indemnitee at the address set forth below Indemnitee signature hereto.



               (b) To the Company at:




iPayment, Inc.

30721 Russell Ranch Road, Suite 200

Westlake Village, California 91362

Attention: Bronson Quon

Facsimile No.: 818) 540-6813




With a copy to:




White & Case LLP

1155 Avenue of the Americas

New York, New York 10036

Attention: Nazim Zilkha

Facsimile No.: 212-354-8113


or to such other address as may have been furnished to Indemnitee by the Company or to the Company
by Indemnitee, as the case may be.




          18. Counterparts. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the same
Agreement. This Agreement may also be executed and delivered by PDF or facsimile signature and in
two or more counterparts, each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.




          19. Headings. The headings of the paragraphs of this Agreement are inserted for
convenience only and shall not be deemed to constitute part of this Agreement or to affect the
construction thereof.




          20. Usage of Pronouns. Use of the masculine pronoun shall be deemed to include usage
of the feminine pronoun where appropriate.




          21. Governing Law and Consent to Jurisdiction. This Agreement and the legal relations
among the parties shall be governed by, and construed and enforced in accordance with, the laws of
the State of Delaware, without regard to its conflict of laws rules. The Company and Indemnitee
hereby irrevocably and unconditionally (i) agree that any action or proceeding arising out of or in
connection with this Agreement shall be brought only in the Delaware Court, and not in any other
state or federal court in the United States of America or any court in any




13









 




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




(Signature page follows)






14









 








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




	 	 	 	 	 
	 	IPAYMENT, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 




 









 





	 	 	 	 	 

	 

	 	INDEMNITEE
	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 
	 
	 	 	 	 
	 

	 	Address: