AMENDMENT NO. 1 TO RIGHTS AGREEMENT
This AMENDMENT NO. 1 (this "Amendment") to the Rights Agreement (the
"Agreement"), dated as of May 12, 2003, between iPayment, Inc., a Delaware
corporation (the "Company"), and Wachovia Bank, National Association, as rights
agent (the "Rights Agent"), is entered into as of this 28th day of November,
2005. Capitalized terms used herein and not otherwise defined shall have the
respective meanings ascribed to such terms in the Agreement.
WHEREAS, Section 27 of the Agreement permits the Company to amend the
Agreement in the manner provided therein at any time prior to the Distribution
Date, and there has not been a Distribution Date.
NOW, THEREFORE, the Agreement is hereby amended as follows:
Section 1. Amendment. The definition of "Acquiring Person" set forth in
Section 1(a) of the Agreement is hereby amended to add the following before the
last sentence of Section 1(a):
"In addition, and notwithstanding the foregoing, none of Xxxxxxx X. Daily
("Daily") or such other Persons that the special committee established by the
Board on May 13, 2005 (the "Special Committee") permits by resolution (a
"Permitted Person") or any "group" consisting solely of one or more of Daily
and/or any Permitted Person shall be deemed to be an Acquiring Person solely as
a result of any arrangement, agreement or understanding with respect to a
Permitted Transaction (as defined below), for so long as any such arrangement,
agreement or understanding is conditioned upon the approval of the Special
Committee. A "Permitted Transaction" means a merger, a tender offer or similar
business combination transaction in which Mr. Daily and one or more Permitted
Persons acquire, directly or indirectly, all (or such lesser number as the
Special Committee shall approve) of the Common Shares not beneficially owned by
them at a price of not less than $43.50 per share, upon terms and conditions
otherwise approved by the Special Committee."
Section 2. Certification. This Section 2 shall constitute a certificate
from an appropriate officer of the Company for purposes of Section 27 of the
Agreement, and the Company and the officer of the Company signing this Amendment
below, on behalf of the Company, (i) hereby certify that to their knowledge this
Amendment is in compliance with the terms of Section 27 of the Agreement and
(ii) request and direct that the Rights Agent execute and deliver this
Amendment, in accordance with Section 27.
Section 3. Full Force and Effect. Except as expressly amended hereby, the
Agreement shall continue in full force and effect unamended and in accordance
with the provisions thereof on the date hereof. This Amendment and the
Agreement, as hereby amended, shall constitute one and the same instrument.
Section 4. Governing Law. This Amendment shall be deemed to be a contract
made under the laws of the State of Delaware, and for all purposes shall be
governed by and construed in accordance with the laws of such State applicable
to contracts made and to be performed entirely within such State.
Section 5. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of this 28th day of November 2005.
iPAYMENT, INC.
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: Executive Vice President, General
Counsel and Secretary
WACHOVIA BANK, NATIONAL ASSOCIATION
By: /s/ XxXxxxx Xxxxxx
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Name: XxXxxxx Xxxxxx
Title: Assistant Vice President
