Document:

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                                                                     EXHIBIT 4.5

                                 iPAYMENT, INC.

                           PIGGY-BACK RIGHTS AGREEMENT

         This PIGGY-BACK RIGHTS AGREEMENT (the "Agreement") is entered into as
of the 28th day of August 2002, by and among iPAYMENT, INC., a Delaware
corporation (the "Company"), JAMES D. GOODRICH and STEPHEN P. GOODRICH
(collectively, the "Investors" and each individually an "Investor").

                                    RECITALS

         WHEREAS, the Company has entered into an Agreement and Plan of Merger
(the "Merger Agreement"), dated as of the date hereof, by and between the
Company, iPayment of Maine, Inc., and First Merchants Bancard Services, Inc.
("FMBS"), whereby the shareholders of FMBS received Three Million Four Hundred
Thousand and No/100 Dollars ($3,400,000.00) in cash and an aggregate amount of
1,600,000 shares of the Company's common stock, $.01 par value per share;

         WHEREAS, it is a condition to closing pursuant to the Merger Agreement,
that the Investors enter into this Agreement; and

         WHEREAS, each of the parties hereto shall receive a substantial benefit
from the closings of the transactions pursuant to the Merger Agreement.

         NOW, THEREFORE, in consideration of the mutual promises,
representations, warranties, covenants and conditions set forth in this
Agreement, the parties mutually agree as follows:

1.       General.

         1.1. Definitions. As used in this Agreement the following terms shall
have the following respective meanings:

         "Common Stock" means the common stock, $.01 par value per share, of the
Company or any successor thereto.

         "Exchange Act" means the Securities Exchange Act of 1934, as amended,
or any similar, successor federal statute and the rules and regulations
thereunder, all as the same shall be in effect from time to time.

         "Initial Offering" means the closing of a firm commitment underwritten
public offering of the Common Stock pursuant to an effective registration
statement under the Securities Act (as defined below) at a price per share of
not less than $8.00 (as adjusted for any stock dividends, combinations or splits
with respect to such shares effected after the date of this Agreement) and
proceeds to the Company of not less than $20,000,000 (after deduction of Selling
Expenses (as hereinafter defined)).

         "Preferred Stock" means the preferred stock, no par value, of the
Company.

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         "Register," "registered," and "registration" refer to a registration
effected by preparing and filing a registration statement in compliance with the
Securities Act, and the declaration or ordering of effectiveness of such
registration statement or document.

         "Registrable Securities" means (i) Common Stock of the Company held by
the Investors; and (ii) any Common Stock of the Company issued as (or issuable
upon the conversion or exercise of any warrant, right or other security which is
issued as) a dividend or other distribution with respect to, or in exchange for
or in replacement of, such above-described securities. Notwithstanding the
foregoing, Registrable Securities shall not include any securities sold by a
person to the public either pursuant to a registration statement or Rule 144 or
sold in a private transaction in which the transferor's rights under Section 2
of this Agreement are not assigned.

         "Registrable Securities then outstanding" shall be the number of shares
determined by calculating the total number of shares of the Common Stock that
are Registrable Securities and either (1) are then issued and outstanding or (2)
are issuable pursuant to then exercisable warrants or convertible securities.

         "Registration Expenses" shall mean all expenses incurred by the Company
in complying with Section 2.2, including, without limitation, all registration
and filing fees, printing expenses, escrow fees, fees and disbursements of
counsel for the Company, reasonable fees and disbursements of a single special
counsel for the Investors, blue sky fees and expenses and the expense of any
special audits incident to or required by any such registration (but excluding
the compensation of regular employees of the Company which shall be paid in any
event by the Company).

         "Securities Act" shall mean the Securities Act of 1933, as amended, or
any similar, successor federal statute and the rules and regulations thereunder,
all as the same shall be in effect from time to time.

         "Selling Expenses" shall mean all underwriting discounts and selling
commissions applicable to the sale.

         "SEC" or "Commission" means the Securities and Exchange Commission.

2.       Registration; Restrictions on Transfer.

         2.1. Restrictions on Transfer.

                  (a) Each Investor agrees not to make any disposition of all or
any portion of the Registrable Securities held by him unless and until:

                           (i) There is then in effect a registration statement
under the Securities Act covering such proposed disposition and such disposition
is made in accordance with such registration statement; or

                           (ii) Such Investor shall have notified the Company of
the proposed disposition, and, if reasonably requested by the Company, such
Investor shall have furnished the Company with an opinion of counsel, reasonably
satisfactory to the

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Company, that such disposition will not require registration of such
shares under the Securities Act. It is agreed that the Company will not require
opinions of counsel for transactions made pursuant to Rule 144 except in unusual
circumstances.

                  (b) Notwithstanding the provisions of paragraphs a(i) and
a(ii) above, no such registration statement or opinion of counsel shall be
necessary for a transfer that would not commence a new holding period under Rule
144(d) where such transfer is made by an Investor which is (i) a partnership (A)
to its partners or former partners in accordance with partnership interests or
(B) to its affiliate (as defined in Rule 405 promulgated under the Securities
Act), (ii) a corporation either (A) to its shareholders in accordance with their
interest in the corporation or (B) to its affiliate (as defined in Rule 405
promulgated under the Securities Act), (iii) a limited liability company (A) to
its members or former members in accordance with their interest in the limited
liability company or (B) to its affiliate (as defined in Rule 405 promulgated
under the Securities Act), or (iv) to the Investor's family member or trust for
the benefit of an individual Investor, provided the transferee will be subject
to the terms of this Section 2.1 to the same extent as if he were an original
Investor hereunder.

                  (c) Each certificate representing the Registrable Securities
shall (unless otherwise permitted by the provisions of this Agreement) be
stamped or otherwise imprinted with a legend substantially similar to the
following (in addition to any legend required by the Company's Bylaws under
applicable state securities laws or as provided elsewhere in this Agreement):

                  THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
                  UNDER THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE
                  OFFERED, SOLD OR OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED OR
                  HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR
                  UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL
                  SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT SUCH
                  REGISTRATION IS NOT REQUIRED.

                  (d) The Company shall be obligated to reissue promptly
unlegended certificates at the request of any holder thereof if the holder shall
have obtained an opinion of counsel (which counsel may be counsel to the
Company) reasonably acceptable to the Company to the effect that the securities
proposed to be disposed of may lawfully be so disposed of without registration,
qualification or legend.

                  (e) Any legend endorsed on an instrument pursuant to
applicable state securities laws and the stop-transfer instructions with respect
to such securities shall be removed upon receipt by the Company of an order of
the appropriate blue sky authority authorizing such removal.

         2.2. Piggyback Registrations. The Company shall notify all Investors in
writing at least thirty (30) days prior to the filing of any registration
statement under the Securities Act for purposes of any follow-on public offering
of securities of the Company

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(excluding registration statements relating to the Company's initial public
offering, employee benefit plans or with respect to corporate reorganizations or
other transactions under Rule 145 of the Securities Act), and will afford each
such Investors an opportunity to include in such registration statement all or
part of such Registrable Securities held by such Investor. Each Investor
desiring to include in any such registration statement all or any part of the
Registrable Securities held by it shall, within fifteen (15) days after the
above-described notice from the Company, so notify the Company in writing. If an
Investor decides not to include all of its Registrable Securities in any
registration statement thereafter filed by the Company, such Investor shall
nevertheless continue to have the right to include any Registrable Securities in
any subsequent registration statement or registration statements as may be filed
by the Company with respect to follow-up offerings of its securities, all upon
the terms and conditions set forth herein.

                  (a) Underwriting. If the registration statement under which
the Company gives notice under this Section 2.2 is for an underwritten offering,
the Company shall so advise the Investors. In such event, the right of any such
Investor to be included in a registration pursuant to this Section 2.2 shall be
conditioned upon such Investor's participation in such underwriting and the
inclusion of such Investor's Registrable Securities in the underwriting to the
extent provided herein. All Investors proposing to distribute their Registrable
Securities through such underwriting shall enter into an underwriting agreement
in customary form with the underwriter or underwriters selected for such
underwriting by the Company. Notwithstanding any other provision of this
Agreement, if the underwriter determines in good faith that marketing factors
require a limitation of the number of shares to be underwritten, the number of
shares that may be included in the underwriting shall be reduced pro rata among
the Investors, those persons other than the Company who are parties to that
certain Piggy-Back Rights Agreement entered into in connection with the
acquisition of OnLine Data Corp. (the "OnLine Agreement") on August 22, 2002,
and those persons other than the Company who are parties to that certain
Investors Rights Agreement dated, April 12, 2001, as amended by Amendment No. 1
to the Investor Rights Agreement, dated, March 19, 2002 (collectively, the
"Prior Investors"), requesting inclusion in the underwritten offering based upon
the number of shares so requested to be registered; provided, however, that such
number of shares shall not be reduced until all shares to be included in such
underwriting for the account of any person other than the Company, the Prior
Investors or the Investors have been removed from such underwriting. This
Section 2.2(a) hereby amends and restates Section 2.2(a) of the Online
Agreement.

                  (b) Right to Terminate Registration. The Company shall have
the right to terminate or withdraw any registration initiated by it under this
Section 2.2 prior to the effectiveness of such registration whether or not any
Investor has elected to include securities in such registration. The
Registration Expenses of such withdrawn registration shall be borne by the
Company in accordance with Section 2.3 hereof.

         2.3. Expenses of Registration. Except as specifically provided herein,
all Registration Expenses incurred in connection with any registration under
Sections 2.2 herein shall be borne by the Company. All Selling Expenses incurred
in connection with any registrations hereunder, shall be borne by the holders of
the securities so registered pro rata on the basis of the number of shares so
registered. If the Investors are required to

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pay the Registration Expenses, such expenses shall be borne by the holders of
securities (including Registrable Securities) requesting such registration in
proportion to the number of shares for which registration was requested.

         2.4. Obligations of the Company. Whenever the Company has received
notice of an Investor's exercise of his rights under Section 2.2 hereof, the
Company shall, as expeditiously as reasonably possible:

                  (a) Prepare and file with the SEC a registration statement
with respect to such Registrable Securities and use all reasonable efforts to
cause such registration statement to become effective.

                  (b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement.

                  (c) Furnish to the Investors such number of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as they may
reasonably request in order to facilitate the disposition of Registrable
Securities owned by them.

                  (d) Use all reasonable efforts to register and qualify the
securities covered by such registration statement under such other securities or
blue sky laws of such jurisdictions as shall be reasonably requested by the
Investors, provided that the Company shall not be required in connection
therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions.

                  (e) In the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter(s) of such offering. Each Investor
holding Registrable Securities participating in such underwriting shall also
enter into and perform its obligations under such an agreement.

                  (f) Notify each Investor covered by such registration
statement at any time when a prospectus relating thereto is required to be
delivered under the Securities Act of the happening of any event as a result of
which the prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in the light of the circumstances then existing and, at the
request of any Investor, prepare and furnish to such Investor a reasonable
number of copies of a supplement to, or an amendment of, such prospectus as may
be necessary so that, as thereafter delivered to the purchasers of such shares,
such prospectus shall not include an untrue statement of material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing.

         2.5. Termination of Registration Rights. All registration rights
granted to an Investor under this Section 2 shall terminate and be of no further
force and effect upon

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such date as all shares of Registrable Securities held or entitled to be held
upon conversion by such Investor may immediately be sold under Rule 144(k)
during any ninety (90) day period.

         2.6.     Delay of Registration; Furnishing Information.

                  (a) No Investor shall have any right to obtain or seek an
injunction restraining or otherwise delaying any such registration as the result
of any controversy that might arise with respect to the interpretation or
implementation of this Section 2.

                  (b) It shall be a condition precedent to the obligations of
the Company to take any action pursuant to Section 2.2 that the selling
Investors shall furnish to the Company such information regarding themselves,
the Registrable Securities held by them and the intended method of disposition
of such securities as shall be required to effect the registration of their
Registrable Securities.

         2.7. Indemnification. In the event any Registrable Securities are
included in a registration statement under Section 2.2:

                  (a) To the extent permitted by law, the Company will indemnify
and hold harmless each Investor, the partners, officers, directors and legal
counsel of each Investor, any underwriter (as defined in the Securities Act) for
such Investor and each person, if any, who controls such Investor or underwriter
within the meaning of the Securities Act or the Exchange Act, against any
losses, claims, damages, or liabilities (joint or several) to which they may
become subject under the Securities Act, the Exchange Act or other federal or
state law, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any of the following statements,
omissions or violations (collectively a "Violation") by the Company (i) any
untrue statement or alleged untrue statement of a material fact contained in
such registration statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements thereto, (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein, or necessary to make the statements therein not misleading, or
(iii) any violation or alleged violation by the Company of the Securities Act,
the Exchange Act, any state securities law or any rule or regulation promulgated
under the Securities Act, the Exchange Act or any state securities law in
connection with the offering covered by such registration statement; and the
Company will reimburse each such Investor, partner, officer or director,
underwriter or controlling person for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided however, that the indemnity
agreement contained in this Section 2.7(a) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Company, which consent shall
not be unreasonably withheld, nor shall the Company be liable in any such case
for any such loss, claim, damage, liability or action to the extent that it
arises out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by such Investor, partner, officer, director, underwriter
or controlling person of such Investor.

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                  (b) To the extent permitted by law, each Investor will, if
Registrable Securities held by such Investor are included in the securities as
to which such registration qualifications or compliance is being effected,
indemnify and hold harmless the Company, each of its directors, its officers,
and legal counsel and each person, if any, who controls the Company within the
meaning of the Securities Act, any underwriter and any other Investor selling
securities under such registration statement or any of such other Investor's
partners, directors or officers or any person who controls such Investor,
against any losses, claims, damages or liabilities (joint or several) to which
the Company or any such director, officer, controlling person, underwriter or
other such Investor, or partner, director, officer or controlling person of such
other Investor may become subject under the Securities Act, the Exchange Act or
other federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based upon any
Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished by such Investor under an instrument duly executed by such Investor
and stated to be specifically for use in connection with such registration; and
each such Investor will reimburse any legal or other expenses reasonably
incurred by the Company or any such director, officer, controlling person,
underwriter or other Investor, or partner, officer, director or controlling
person of such other Investor in connection with investigating or defending any
such loss, claim, damage, liability or action if it is judicially determined
that there was such a Violation; provided, however, that the indemnity agreement
contained in this Section 2.7(b) shall not apply to amounts paid in settlement
of any such loss, claim, damage, liability or action if such settlement is
effected without the consent of the Investor, which consent shall not be
unreasonable withheld.

                  (c) Promptly after receipt by an indemnified party under this
Section 2.7 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 2.7, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain its own counsel, with the fees and expenses to be paid
by the indemnifying party, if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to actual
or potential differing interests between such indemnified party and any other
party represented by such counsel in such proceeding. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action, if materially prejudicial to its ability to
defend such action, shall relieve such indemnifying party of any liability to
the indemnified party under this Section 2.7, but the omission so to deliver
written notice to the indemnifying party will not relieve it of any liability
that it may have to any indemnified party otherwise than under this Section 2.7.

                  (d) If the indemnification provided for in this Section 2.7 is
held by a court of competent jurisdiction to be unavailable to an indemnified
party with respect to any losses, claims, damages or liabilities referred to
herein, the indemnifying party, in lieu of indemnifying such indemnified party
thereunder, shall to the extent permitted by

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applicable law contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability in such proportion as
is appropriate to reflect the relative fault of the indemnifying party on the
one hand and of the indemnified party on the other in connection with the
Violation(s) that resulted in such loss, claim, damage or liability, as well as
any other relevant equitable considerations. The relative fault of the
indemnifying party and of the indemnified party shall be determined by a court
of law by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission to state a material fact relates to
information supplied by the indemnifying party or by the indemnified party and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission; provided, that in no event
shall any contribution by an Investor hereunder exceed the proceeds from the
offering received by such Investor.

                  (e) The obligations of the Company and Investor under this
Section 2.7 shall survive completion of any offering of Registrable Securities
in a registration statement. No indemnifying party, in the defense of any such
claim or litigation, shall, except with the consent of each indemnified party,
consent to entry of any judgment or enter into any settlement which does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such indemnified party of a release from all liability in respect to such
claim or litigation.

         2.8. "Market Stand-Off" Agreement. If requested by the Company or the
representative of the underwriters of Common Stock (or other securities) of the
Company, each Investor shall not sell or otherwise transfer or dispose of any
Common Stock (or other securities) of the Company held by such Investor (other
than those included in the registration) for a period specified by the
representative of the underwriters. The obligations described in this Section
2.8 shall not apply to a registration relating solely to employee benefit plans
on Form S-1 or Form S-8 or similar forms that may be promulgated in the future,
or a registration relating solely to a Commission Rule 145 transaction on Form
S-4 or similar forms that may be promulgated in the future. The Company may
impose stop-transfer instructions with respect to the shares of Common Stock (or
other securities) subject to the foregoing restriction until the end of said
restricted period.

         2.9. Rule 144 Reporting. With a view to making available to the
Investors the benefits of certain rules and regulations of the SEC which may
permit the sale of the Registrable Securities to the public without
registration, the Company agrees to use its best efforts to:

                  (a) Make and keep public information available, as those terms
are understood and defined in SEC Rule 144 or any similar or analogous rule
promulgated under the Securities Act, at all times after the effective date of
the first registration filed by the Company for an offering of its securities to
the general public;

                  (b) File with the SEC, in a timely manner, all reports and
other documents required of the Company under the Exchange Act;

                  (c) So long as an Investor owns any Registrable Securities,
furnish to such Investor forthwith upon request: a written statement by the
Company as to its

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compliance with the reporting requirements of said Rule 144 of the Securities
Act, and of the Exchange Act (at any time after it has become subject to such
reporting requirements); a copy of the most recent annual or quarterly report of
the Company; and such other reports and documents as an Investor may reasonably
request in availing itself of any rule or regulation of the SEC allowing it to
sell any such securities without registration.

         3.       Miscellaneous.

         3.1. Governing Law. This Agreement shall be governed by and construed
under the laws of the State of Tennessee.

         3.2. Survival. The representations, warranties, covenants, and
agreements made herein shall survive any investigation made by any Investor and
the closing of the transactions contemplated hereby. All statements as to
factual matters contained in any certificate or other instrument delivered by or
on behalf of the Company pursuant hereto in connection with the transactions
contemplated hereby shall be deemed to be representations and warranties by the
Company hereunder solely as of the date of such certificate or instrument.

         3.3. Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors, and administrators of the
parties hereto and shall inure to the benefit of and be enforceable by each
person who shall be a holder of Registrable Securities from time to time;
provided, however, that prior to the receipt by the Company of adequate written
notice of the transfer of any Registrable Securities specifying the full name
and address of the transferee, the Company may deem and treat the person listed
as the holder of such shares in its records as the absolute owner and holder of
such shares for all purposes, including the payment of dividends or any
redemption price.

         3.4. Severability. In case any provision of this Agreement shall be
invalid, illegal, or unenforceable, the validity, legality, and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.

         3.5. Amendment and Waiver. Except as otherwise expressly provided, this
Agreement may be amended or modified, and the obligations of the Company and the
rights of the Investors under this Agreement may be waived, only upon the
written consent of the Company and the Investors holding at least seventy-five
percent (75%) of the Registrable Securities then outstanding; provided, however,
that no amendment shall be made to any provision of this Agreement that has an
adverse effect on any party's rights under this Agreement without the written
consent of such adversely-effected party.

         3.6. Delays or Omissions. It is agreed that no delay or omission to
exercise any right, power, or remedy accruing to any Investor, upon any breach,
default or noncompliance of the Company under this Agreement shall impair any
such right, power, or remedy, nor shall it be construed to be a waiver of any
such breach, default or noncompliance, or any acquiescence therein, or of any
similar breach, default or noncompliance thereafter occurring. It is further
agreed that any waiver, permit, consent, or approval of any kind or character on
any Investor's part of any breach, default or

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noncompliance under this Agreement or any waiver on such Investor's part of any
provisions or conditions of this Agreement must be in writing and shall be
effective only to the extent specifically set forth in such writing. All
remedies, either under this Agreement, by law, or otherwise afforded to
Investors, shall be cumulative and not alternative.

         3.7. Notices. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (i) upon personal delivery to the
party to be notified, (ii) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient; if not, then on the next business
day, (iii) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid, or (iv) 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 to the
party to be notified at the address as set forth on the signature pages hereof
or Exhibit A hereto or at such other address as such party may designate by ten
(10) days advance written notice to the other parties hereto.

         3.8. Attorneys' Fees. In the event that any dispute among the parties
to this Agreement should result in litigation, the prevailing party in such
dispute shall be entitled to recover from the losing party all fees, costs and
expenses of enforcing any right of such prevailing party under or with respect
to this Agreement, including without limitation, such reasonable fees and
expenses of attorneys and accountants, which shall include, without limitation,
all fees, costs and expenses of appeals.

         3.9. Titles and Subtitles. The titles of the sections and subsections
of this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.

         3.10. Pronouns. All pronouns contained herein and any variations
thereof shall be deemed to refer to the masculine, feminine or neuter, singular
or plural, as the identity of the parties hereto may require.

         3.11. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.

         3.12. Entire Agreement. This Agreement constitutes the entire agreement
among the parties hereto with respect to the matters set forth herein, and it
supersedes all prior oral or written agreements, commitments or understandings
with respect to the matters provided for herein.

                      (SIGNATURES BEGIN ON FOLLOWING PAGE)

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         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date set forth in the first paragraph hereof.

                                 COMPANY:

                                 iPAYMENT, INC.

                                 By:   /s/ Gregory S. Daily
                                     ---------------------------------------
                                         Gregory S. Daily
                                         Chairman and Chief Executive
                                         Officer

                                 INVESTORS:

                                       /s/ James D. Goodrich
                                      --------------------------------------
                                         James D. Goodrich

                                       /s/ Stephen P. Goodrich
                                     ---------------------------------------
                                         Stephen P. Goodrich

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                                  PARTIES TO THIS AGREEMENT ONLY FOR PURPOSES
                                  OF AMENDING AND RESTATING SECTION 2.2(a)
                                  OF THE ONLINE DATA PIGGY-BACK RIGHTS AGREEMENT

                                  /s/ Allen Caviles
                                  ---------------------------------------
                                  Allen Caviles

                                  /s/ Kristen Gramigna
                                  ---------------------------------------
                                  Kristen Gramigna

                                  /s/ Bob Hurley
                                  ---------------------------------------
                                  Bob Hurley

                                  /s/ Cindy Joyce
                                  ---------------------------------------
                                  Cindy Joyce

                                  /s/ Karen Koziol
                                  ---------------------------------------
                                  Karen Koziol

                                  /s/ Nicole Mondia
                                  ---------------------------------------
                                  Nicole Mondia

                                  /s/ John Rante
                                  ---------------------------------------
                                  John Rante

                                  /s/ Bill Schlunz
                                  ---------------------------------------
                                  Bill Schlunz

                                  /s/ Nicole Smith
                                  ---------------------------------------
                                  Nicole Smith

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                           ACKNOWLEDGEMENT AND CONSENT

         IN WITNESS WHEREOF, the parties below hereby acknowledge and consent to
the execution and delivery of this Agreement by iPayment Holdings, Inc. as of
the date set forth in the first paragraph hereof.

                               FIRST AVENUE PARTNERS, L.P.

                               By:    Front Street, LLC, GP, its General Partner

                               By:    /s/ David M. Wilds
                                    ----------------------------------------
                                          David M. Wilds
                                          Chief Manager

                               HARBINGER MEZZANINE PARTNERS, L.P.

                               By:     Harbinger Mezzanine GP, LLC,
                                       its General Partner

                                       By: Harbinger Mezzanine Manager, Inc.,
                                           its Manager

                                           By:  /s/ John C. Harrison
                                              ------------------------------
                                               John C. Harrison
                                               Director

                               CAYMAS, LLC

                               By:    /s/ Gregory S. Daily
                                    ----------------------------------------
                               Name:
                                    ----------------------------------------
                               Title:
                                    ----------------------------------------

<PAGE>

                                /s/  Gregory S. Daily
                                ----------------------------------------------
                                Gregory S. Daily

                                /s/ Carl Grimstad
                                ----------------------------------------------
                                Carl Grimstad

                         STREAM FAMILY LIMITED PARTNERSHIP

                         By:    /s/ Bruce N. Kirkpatrick
                                ----------------------------------------------
                         Name:  Bruce N. Kirkpatrick
                                ----------------------------------------------
                         Title: Secretary Treasurer
                                ----------------------------------------------
                            Matilda Stream Management, Inc.
                         -----------------------------------------------------
                            Managing General Partner
                         -----------------------------------------------------

                         SUMMIT VENTURES V, L.P.

                         By:      Summit Partners V, L.P.,
                                  its General Partner

                         By:      Summit Partners, LLC,
                                  its General Partner

                         By:      /s/ Peter Chung
                                  --------------------------------------------
                         Name:    Peter Y. Chung
                         Title:   Member

                         SUMMIT VENTURES V COMPANION FUND, L.P.

                         By:      Summit Partners V, L.P.,
                                  its General Partner

                         By:      Summit Partners, LLC,
                                  its General Partner

                         By:      /s/ Peter Chung
                                  --------------------------------------------
                         Name:    Peter Y. Chung
                         Title:   Member

<PAGE>

                       SUMMIT V ADVISORS FUND, L.P.

                       By:      Summit Partners V, L.P.,
                                its General Partner

                       By:      Summit Partners, LLC,
                                its General Partner

                       By:        /s/ Peter Chung
                                --------------------------------------------
                       Name:    Peter Y. Chung
                       Title:   Member

                       SUMMIT V ADVISORS (QP) FUND, L.P.

                       By:      Summit Partners V, L.P.,
                                its General Partner

                       By:      Summit Partners, LLC,
                                its General Partner

                       By:        /s/ Peter Chung
                                --------------------------------------------
                       Name:    Peter Y. Chung
                       Title:   Member

                       SUMMIT INVESTORS III, L.P.

                       By:        /s/ Peter Chung
                                --------------------------------------------
                       Name:    Peter Y. Chung
                       Title:   Authorized Signatory

                       RANDOLPH STREET PARTNERS

                       By:       /s/  Ted H. Zook
                                --------------------------------------------
                       Name:     Ted H. Zook
                                --------------------------------------------
                       Title:   Authorized Signatory
                                --------------------------------------------

                       RANDOLPH STREET PARTNERS 1998 DIF, LLC

                       By:       /s/  Ted H. Zook
                                --------------------------------------------
                       Name:     Ted H. Zook
                                --------------------------------------------
                       Title:   Authorized Signatory
                                --------------------------------------------

<PAGE>

                       SYCR INVESTMENT FUND I, LLC

                       By:         /s/ Stephen T. Freeman
                                --------------------------------------------
                       Name:      Stephen T. Freeman
                                --------------------------------------------
                       Title:     Manager
                                --------------------------------------------

                       By:         /s/ Lawrence B. Cohn
                                --------------------------------------------
                       Name:      Lawrence B. Cohn
                                --------------------------------------------
                       Title:     Manager
                                --------------------------------------------<PAGE>
                                                                     EXHIBIT 4.7

         THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
         SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR
         SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION
         STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN
         OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH
         REGISTRATION IS NOT REQUIRED.

No. ________                                    Date of Issuance: ________, 2001

                             iPAYMENT HOLDINGS, INC.

                    FORM OF WARRANT TO PURCHASE COMMON STOCK

         THIS CERTIFIES THAT, for value received, _________________
("Warrantholder") is entitled to subscribe for and purchase from iPAYMENT
Holdings, Inc. (the "Company"), subject to the terms set forth below, _______
shares of Common Stock of the Company ("Common Stock") at $0.01 per share (the
"Warrant Price") upon surrender hereof, at the principal office of the Company
referred to below.

         1. TERM. Subject to the terms hereof, the purchase right represented by
this Warrant is exercisable, in whole or in part, at any time and from time to
time and until the date ten (10) years after the date hereof (the "Term").

         2. METHOD OF EXERCISE; PAYMENT; ISSUANCE OF NEW WARRANT.

            (a) The purchase right represented by this Warrant may be exercised
by the Warrantholder, in whole or in part and from time to time during the Term,
by the surrender of this Warrant (together with the notice of exercise form
attached hereto as Exhibit A, duly executed) at the principal office of the
Company and by the payment to the Company, by check or bank draft, of an amount
equal to the Warrant Price multiplied by the number of shares of Common Stock
then being purchased.

         The person or persons in whose name(s) any certificate(s) representing
shares of Common Stock shall be issuable upon exercise of this Warrant shall be
deemed to have become the holder(s) of record of, and shall be treated for all
purposes as the record holder(s) of, the shares of Common Stock represented
thereby (and such shares shall be deemed to have been issued) immediately prior
to the close of business on the date or dates upon which this Warrant is
exercised. In the event of any exercise of the rights represented by this
Warrant, certificates for the shares of Common Stock so purchased shall be
delivered to the Warrantholder as soon as practicable and, in any event, within
thirty (30) days of receipt of such notice and, unless this Warrant has been
fully exercised or expired, a

                                      -1-
<PAGE>
new Warrant representing the shares of Common Stock, if any, with respect to
which this Warrant shall not then have been exercised shall also be issued to
the Warrantholder as soon as practicable and, in any event, within such thirty
(30)-day period.

         3. COVENANTS AND CONDITIONS. The above provisions are subject to the
following:

            (a) Neither this Warrant nor the shares of Common Stock that may be
issued upon exercise of the rights represented by this Warrant have been
registered under the Securities Act of 1933, as amended ("Securities Act"), or
any state securities laws ("Blue Sky Laws"). This Warrant has been acquired for
investment purposes and not with a view to distribution or resale and may not be
sold or otherwise transferred without (i) an effective registration statement
for such Warrant under the Securities Act and such applicable Blue Sky Laws, or
(ii) an opinion of counsel, which opinion and counsel shall be reasonably
satisfactory to the Company and its counsel, that registration is not required
under the Securities Act or under any applicable Blue Sky Laws. Transfer of the
shares issued upon the exercise of this Warrant shall be restricted in the same
manner and to the same extent as the Warrant and the certificates representing
such Shares shall bear substantially the following legend:

         THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT
         BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
         "ACT"), OR ANY APPLICABLE STATE SECURITIES LAW AND MAY NOT BE
         TRANSFERRED UNTIL (I) A REGISTRATION STATEMENT UNDER THE ACT AND SUCH
         APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME EFFECTIVE WITH
         REGARD THERETO, OR (II) IN THE OPINION OF COUNSEL ACCEPTABLE TO THE
         COMPANY, REGISTRATION UNDER SUCH ACT AND SUCH APPLICABLE STATE
         SECURITIES LAWS IS NOT REQUIRED IN CONNECTION WITH SUCH PROPOSED
         TRANSFER.

The Warrantholder and the Company agree to execute such other documents and
instruments as counsel for the Company reasonably deems necessary to effect the
compliance of the issuance of this Warrant and any shares of Common Stock issued
upon exercise hereof with applicable federal and state securities laws.

            (b) All shares of Common Stock that may be issued upon the exercise
of the rights represented by this Warrant will, upon issuance, be fully paid and
nonassessable, and free from all liens. During the Term, the Company will at all
times have authorized and reserved for the purpose of issuance upon exercise of
the purchase rights evidenced by this Warrant, a sufficient number of shares of
its Common Stock to provide for the exercise of the rights represented by this
Warrant.

         4. ADJUSTMENT OF WARRANT PRICE. The Warrant Price shall be subject to
adjustment from time to time as follows:

                                      -2-
<PAGE>
             (a) If, at any time during the Term, the number of shares of Common
Stock outstanding is increased by a stock dividend payable in shares of Common
Stock or by a subdivision or split-up of shares of Common Stock, then, following
the record date fixed for the determination of holders of Common Stock entitled
to receive such stock dividend, subdivision or split-up, the Warrant Price shall
be appropriately decreased and the number of shares of Common Stock issuable
upon the exercise hereof shall be increased in proportion to such increase in
outstanding shares so that the aggregate Warrant Price remains unchanged.

             (b) If, at any time during the Term, the number of shares of Common
Stock outstanding is decreased by a combination of the outstanding shares of
Common Stock, then, following the record date for such combination, the Warrant
Price shall be appropriately increased and the number of shares of Common Stock
issuable upon the exercise hereof shall be decreased in proportion to such
decrease in outstanding shares so that the aggregate Warrant Price remains
unchanged.

             (c) In case, at any time during the Term, the Company shall declare
a cash dividend upon its Common Stock payable otherwise than out of earnings or
earned surplus or shall distribute to holders of its Common Stock shares of its
capital stock (other than Common Stock), stock or other securities of other
persons, evidences of indebtedness issued by the Company or other persons,
assets (excluding cash dividends and distributions) or options or rights
(excluding options to purchase and rights to subscribe for Common Stock or other
securities of the Company convertible into or exchangeable for Common Stock),
then, in each such case, immediately following the record date fixed for the
determination of the holders of Common Stock entitled to receive such dividend
or distribution, the Warrant Price in effect thereafter shall be determined by
multiplying the Warrant Price in effect immediately prior to such record date by
a fraction of which the numerator shall be an amount equal to the difference of
(x) the Current Market Price of one share of Common Stock minus (y) the fair
market value (as determined by the Board of Directors of the Company, whose
determination shall be conclusive) of the amount of cash, stock, securities,
evidences of indebtedness, assets, options or rights, as the case may be, so
distributed in respect of one share of Common Stock, and of which the
denominator shall be such Current Market Price.

             (d) All calculations under this Section 4 shall be made to the
nearest cent or to the nearest share, as the case may be.

             (e) For the purpose of any computation pursuant to this Section 4,
the Current Market Price at any date of one share of Common Stock shall be
deemed to be the average of the daily closing prices for the 15 consecutive
business days ending on the last business day before the day in question (as
adjusted for any stock dividend, split, combination or reclassification that
took effect during such 15 business day period). The closing price for each day
shall be the last reported sales price regular way or, in case no such reported
sales took place on such day, the average of the last reported bid and asked
prices regular way, in either case on the principal national securities exchange
on which the Common Stock is listed or admitted to trading or as reported by
Nasdaq (or if the Common Stock is not at the time listed or admitted for trading
on any such exchange or if prices of the Common Stock are not reported by Nasdaq
then such price shall be equal to

                                      -3-
<PAGE>

the average of the last reported bid and asked prices on such day as reported by
The National Quotation Bureau Incorporated or any similar reputable quotation
and reporting service, if such quotation is not reported by The National
Quotation Bureau Incorporated); provided, however, that if the Common Stock is
not traded in such manner that the quotations referred to in this clause (e) are
available for the period required hereunder, the Current Market Price shall be
determined in good faith by the Board of Directors of the Company.

             (f) Adjustments made pursuant to clauses (a), (b) and (c) above
shall be made on the date such dividend, subdivision, split-up, combination or
distribution, as the case may be, is made, and shall become effective at the
opening of business on the business day next following the record date for the
determination of stockholders entitled to such dividend, subdivision, split-up,
combination or distribution.

             (g) In any case in which the provisions of this Section 4 shall
require that an adjustment shall become effective immediately after a record
date for an event, the Company may defer until the occurrence of such event
issuing to the Warrantholder all or any part of this Warrant which is exercised
after such record date and before the occurrence of such event the additional
shares of capital stock issuable upon such exercise by reason of the adjustment
required by such event over and above the shares of capital stock issuable upon
such exercise before giving effect to such adjustment exercise; provided,
however, that the Company shall deliver to the Warrantholder a due bill or other
appropriate instrument evidencing such Warrantholder's right to receive such
additional shares upon the occurrence of the event requiring such adjustment.

         5. MERGERS, CONSOLIDATION, SALES. In the case of any proposed
consolidation or merger of the Company with another entity, or the proposed sale
of all or substantially all of its assets to another person or entity, or any
proposed reorganization or reclassification of the capital stock of the Company,
then, as a condition of such consolidation, merger, sale, reorganization or
reclassification, lawful and adequate provision shall be made whereby the
Warrantholder shall thereafter have the right to receive upon the basis and upon
the terms and conditions specified herein, in lieu of the shares of the Common
Stock of the Company immediately theretofore purchasable hereunder, such shares
of stock, securities or assets as may (by virtue of such consolidation, merger,
sale, reorganization or reclassification) be issued or payable with respect to
or in exchange for the number of shares of such Common Stock purchasable
hereunder immediately before such consolidation, merger, sale, reorganization or
reclassification. In any such case appropriate provision shall be made with
respect to the rights and interests of the Warrantholder to the end that the
provisions hereof shall thereafter be applicable as nearly as may be
practicable, in relation to any shares of stock, securities or assets thereafter
deliverable upon the exercise of this Warrant.

         6. FRACTIONAL SHARES. No fractional shares of Common Stock will be
issued in connection with any exercise hereunder, but in lieu of such fractional
shares the Company shall make a cash payment therefor upon the basis of the
Warrant Price then in effect.

                                      -4-
<PAGE>
         7. TRANSFERS AND REPLACEMENTS. This Warrant and all rights hereunder
are not transferable, in whole or in part, whether by operation of law or
otherwise, without the prior written consent of the Company. In the event that
Company consents to such a transfer, a new Warrant, of the same tenor as this
Warrant but registered in the name of the transferee or transferees (and in the
name of the Warrantholder, if a partial transfer is effected) shall be made and
delivered by the Company upon surrender of this Warrant duly endorsed, at the
office of the Company referred to in Section 11 hereof. Upon receipt by the
Company of evidence reasonably satisfactory to it of the loss, theft or
destruction, and, in such case, of indemnity or security reasonably satisfactory
to it, and upon surrender of this Warrant if mutilated, the Company will make
and deliver a new Warrant of like tenor, in lieu of this Warrant. This Warrant
shall be promptly cancelled by the Company upon the surrender hereof in
connection with any transfer or replacement. Except as otherwise provided above,
in the case of the loss, theft or destruction of a Warrant, the Company shall
pay all expenses, taxes and other charges payable in connection with any
transfer or replacement of this Warrant, other than stock transfer taxes (if
any) payable in connection with a transfer of this Warrant, which shall be
payable by the Warrantholder.

         8. RIGHTS AS STOCKHOLDERS. The Warrantholder, as such, shall not be
entitled to vote or receive dividends or be deemed the holder of Common Stock,
and nothing contained herein shall be construed to confer upon the
Warrantholder, as such, any of the rights of a stockholder of the Company.

         9. MODIFICATION AND WAIVER. This Warrant and any provision hereof may
be changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of the same is sought.

         10. CERTAIN NOTICES. In case at any time the Company shall propose to:

             (a) declare any cash dividend upon its Common Stock;

             (b) declare any dividend upon its Common Stock payable in stock or
             make any special dividend or other distribution to the holders of
             its Common Stock;

             (c) reorganize, or reclassify the capital stock of the Company, or
             consolidate, merge or otherwise combine with, or sell of all or
             substantially all of its assets to, another corporation; or

             (d) voluntarily or involuntarily dissolve, liquidate or wind up of
             the affairs of the Company;

then, in any one or more of said cases, the Company shall give to the
Warrantholder by certified or registered mail, (i) at least ten (10) days' prior
written notice of the date on which the books of the Company shall close or a
record shall be taken for such dividend, distribution or for determining rights
to vote in respect of any such reorganization, reclassification, consolidation,
merger, sale, dissolution, liquidation or winding up, and (ii) in the case of
such reorganization, reclassification, consolidation, merger, sale, dissolution,

                                      -5-
<PAGE>
liquidation or winding up, at least ten (10) days' prior written notice of the
date when the same shall take place. Any notice required by clause (i) shall
also specify, in the case of any such dividend or distribution, the date on
which the holders of Common Stock shall be entitled thereto, and any notice
required by clause (ii) shall specify the date on which the holders of Common
Stock shall be entitled to exchange their Common Stock for securities or other
property deliverable upon such reorganization, reclassification, consolidation,
merger, sale, dissolution, liquidation or winding up, as the case may be.

             11. NOTICE. Any and all notices, elections or demands permitted or
required to be made under this Warrant shall be in writing, signed by the party
giving such notice, election or demand and shall be delivered personally,
telecopied, telexed, or sent by certified mail or overnight via nationally
recognized courier service (such as Federal Express), to the other party at the
address set forth below, or at such other address as may be supplied in writing.
The date of personal delivery or telecopy or two (2) business days after the
date of mailing (or the next business day after delivery to such courier
service), as the case may be, shall be the date of such notice, election or
demand. For the purposes of this Warrant:

         The Address of Warrantholder is:              -------------------------

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

                                                       -------------------------
                                                       Fax No. (   )
                                                                ---  -----------

         The Address of Company is:                    -------------------------

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

                                                       -------------------------
                                                       Fax No. (   )
                                                                ---  -----------

             12. BINDING EFFECT ON SUCCESSORS. This Warrant shall be binding
upon any corporation succeeding the Company by merger, consolidation or
acquisition of all or substantially all of the Company's assets, and all of the
obligations of the Company relating to the shares of Common Stock shall survive
the exercise and termination of this Warrant and all of the covenants and
agreements of the Company shall inure to the benefit of the successors and
assigns of the Warrantholder.

             13. GOVERNING LAW. This Warrant is made in accordance with and
shall be governed by and construed under the laws of the State of Tennessee,
other than conflicts of law principles.

             14. COUNTERPARTS. This Warrant may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

                                      -6-
<PAGE>
                            [SIGNATURE PAGE FOLLOWS]

                                      -7-
<PAGE>
             IN WITNESS WHEREOF, this Warrant is executed effective as of the
date first above written.

                                            iPAYMENT HOLDINGS, INC.

                                            By:
                                                --------------------------------
                                                Gregory S. Daily,
                                                Chief Executive Officer

ACCEPTED AND AGREED:

WARRANTHOLDER:

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

Signed:
       ----------------------------
Name:
     ------------------------------
Title:
      -----------------------------

                                      -8-

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