ELECTRONIC CLEARING HOUSE INC
EX-10.55 REGISTRATION RIGHTS AGREEMENT
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>4
<FILENAME>ex10-55.txt
<DESCRIPTION>EX-10.55 REGISTRATION RIGHTS AGREEMENT
<TEXT>
                                                                   EXHIBIT 10.55

                          REGISTRATION RIGHTS AGREEMENT


                  This Registration  Rights Agreement (this "AGREEMENT") is made
and entered into as of October 23, 2003, by and among Electronic Clearing House,
Inc., a Nevada corporation (the "COMPANY"),  and the investors  signatory hereto
(each a "PURCHASER" and collectively, the "PURCHASERS").

                  This  Agreement is made  pursuant to the  Securities  Purchase
Agreement,  dated as of the date  hereof,  among the Company and the  Purchasers
(the "PURCHASE AGREEMENT").

                  The Company and the Purchasers hereby agree as follows:

         1.       DEFINITIONS.  Capitalized terms used and not otherwise defined
herein that are defined in the Purchase  Agreement shall have the meanings given
such terms in the Purchase Agreement.  As used in this Agreement,  the following
terms shall have the following meanings:

                  "EFFECTIVENESS  DATE" means,  with respect to the Registration
         Statement  required to be filed  hereunder and subject to the Company's
         right to  suspend  the  Registration  Statement  in SECTION  2(a),  the
         earlier of the 90th  calendar day following the Closing Date (the 150th
         calendar day in the event of a full review by the  Commission)  and (b)
         the  tenth  Trading  Day  following  the date on which the  Company  is
         notified by the Commission that the Registration  Statement will not be
         reviewed  or is no longer  subject  to  further  review  and  comments;
         PROVIDED,  HOWEVER,  if subsequent to receiving such  notification from
         the  Commission  the Company  files a  pre-effective  amendment  to the
         Registration  Statement,  such 10 Trading Day period  shall be from the
         clearance  by the  Commission  of  such  pre-effective  amendment;  and
         PROVIDED,  FURTHER,  that if subsequent to receiving such  notification
         from the  Commission  the  Registration  Statement  cannot be  declared
         effective  because the Company is unable to comply with Rule 3-12(b) of
         Regulation S-X, the  Effectiveness  Date shall be extended to the tenth
         Trading Day  following  the date the Company files its Annual Report on
         Form 10-K for the fiscal year ending September 30, 2003.

                  "EFFECTIVENESS  PERIOD"  shall have the  meaning  set forth in
         SECTION 2(a).

                  "FILING  DATE"  means,   with  respect  to  the   Registration
         Statement  required to be filed  hereunder and subject to the Company's
         right to suspend the  Registration  Statement in SECTION 2(a), the 30th
         calendar day following the Closing Date.

                  "HOLDER" or "HOLDERS" means the holder or holders, as the case
         may be, from time to time of Registrable Securities.

                  "INDEMNIFIED  PARTY"  shall  have  the  meaning  set  forth in
         SECTION 5(c).

                  "INDEMNIFYING  PARTY"  shall  have the  meaning  set  forth in
         SECTION 5(c).

                  "LOSSES" shall have the meaning set forth in SECTION 5(a).


<PAGE>


                  "PROCEEDING" means an action,  claim,  suit,  investigation or
         proceeding (including,  without limitation, an investigation or partial
         proceeding, such as a deposition), whether commenced or threatened.

                  "PROSPECTUS" means the prospectus included in the Registration
         Statement  (including,  without limitation,  a prospectus that includes
         any information  previously  omitted from a prospectus filed as part of
         an  effective   registration  statement  in  reliance  upon  Rule  430A
         promulgated  under the Securities  Act), as amended or  supplemented by
         any prospectus supplement, with respect to the terms of the offering of
         any portion of the Registrable  Securities  covered by the Registration
         Statement,  and all other amendments and supplements to the Prospectus,
         including post-effective  amendments,  and all material incorporated by
         reference or deemed to be incorporated by reference in such Prospectus.

                  "REGISTRABLE  SECURITIES" means the Shares,  together with any
         shares  of  Common  Stock  issued or  issuable  upon any  stock  split,
         dividend or other distribution,  recapitalization or similar event with
         respect to the foregoing.

                  "REGISTRATION  STATEMENT"  means  the  registration  statement
         required  to  be  filed   hereunder,   including  (in  each  case)  the
         Prospectus, amendments and supplements to the registration statement or
         Prospectus,  including pre- and post-effective amendments, all exhibits
         thereto,  and all  material  incorporated  by reference or deemed to be
         incorporated by reference in the registration statement.

                  "RULE  415"  means  Rule  415  promulgated  by the  Commission
         pursuant to the  Securities  Act, as such Rule may be amended from time
         to time,  or any similar rule or  regulation  hereafter  adopted by the
         Commission having substantially the same effect as such Rule.

                  "RULE  424"  means  Rule  424  promulgated  by the  Commission
         pursuant to the  Securities  Act, as such Rule may be amended from time
         to time,  or any similar rule or  regulation  hereafter  adopted by the
         Commission having substantially the same effect as such Rule.

                  "SECURITIES ACT" means the Securities Act of 1933, as amended.

         2.       REGISTRATION.

                  (a)      On or prior to the Filing  Date,  the  Company  shall
         prepare  and  file  with  the  Commission  the  Registration  Statement
         covering  the  resale  of  all  of the  Registrable  Securities  for an
         offering to be made on a  continuous  basis  pursuant to Rule 415.  The
         Registration  Statement required hereunder shall be on Form S-3 (except
         if the  Company  is not  then  eligible  to  register  for  resale  the
         Registrable  Securities  on Form S-3,  in which  case the  Registration
         shall be on  another  appropriate  form in  accordance  herewith).  The
         Registration  Statement  required  hereunder  shall contain  (except if
         otherwise  directed by the Holders or required by the  Commission)  the
         "PLAN OF  DISTRIBUTION"  attached  hereto as ANNEX A. The Company shall
         cause  the  Registration  Statement  to  become  effective  and  remain
         effective as provided  herein.  The Company shall use its  commercially
         reasonable  efforts to cause the Registration  Statement to be declared
         effective  under the  Securities


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<PAGE>


         Act as promptly as possible after the filing thereof,  but in any event
         not later than the  Effectiveness  Date, and shall use its commercially
         reasonable  efforts  to keep the  Registration  Statement  continuously
         effective  under the  Securities  Act  until the date  which is two (2)
         years after the Closing Date or such earlier date when all  Registrable
         Securities covered by the Registration  Statement have been sold or may
         be  sold  without  volume  restrictions  pursuant  to  Rule  144(k)  as
         determined by the counsel to the Company  pursuant to a written opinion
         letter  to such  effect,  addressed  and  acceptable  to the  Company's
         transfer agent and the affected Holders (the  "EFFECTIVENESS  PERIOD").
         Notwithstanding the foregoing,  the Company's  obligations hereunder to
         file a  Registration  Statement  and to keep a  Registration  Statement
         continuously  effective  under the  Securities  Act shall be  suspended
         without  penalty as provided in SECTION  2(b) of this  Agreement if the
         fulfillment  of such  obligations  would  require the Company to make a
         disclosure  that would,  in the  reasonable  judgment of the  Company's
         Board of  Directors,  have a Material  Adverse  Effect (as such term is
         defined  in the  Securities  Purchase  Agreement)  on the  Company or a
         material  adverse effect on the future  prospects of the Company or its
         stockholders;  PROVIDED,  that  the  Registration  Statement  shall  be
         suspended for a total of no more than  forty-five  (45) days during any
         twelve (12)-month period.

                  (b)      If: (i) a  Registration  Statement is not filed on or
         prior to its Filing Date,  or (ii) a  Registration  Statement  filed or
         required  to be  filed  hereunder  is  not  declared  effective  by the
         Commission  on or  before  the  Effectiveness  Date,  or (iii)  after a
         Registration  Statement is first declared  effective by the Commission,
         it ceases for any  reason to remain  continuously  effective  as to all
         Registrable Securities for which it is required to be effective, or the
         Holders are not permitted to utilize the  Prospectus  therein to resell
         such Registrable Securities, for in any such cases fifteen (15) Trading
         Days (which need not be consecutive  days) in the aggregate  during any
         month  period  (any such  failure  or breach  being  referred  to as an
         "EVENT," and for purposes of CLAUSE (i) or (iii) the date on which such
         Event  occurs,  or for  purposes of CLAUSE (iii) the date on which such
         fifteen (15) Trading Day period is exceeded being referred to as "EVENT
         DATE"),  then in  addition  to any other  rights the  Holders  may have
         hereunder  or under  applicable  law:  (x) on each such  Event Date the
         Company  shall pay to each  Holder an  amount  in cash,  as  liquidated
         damages  and not as a penalty,  equal to 1% of the  aggregate  purchase
         price paid by such Holder  pursuant to the Purchase  Agreement  for any
         Registrable  Securities  then  held  by  such  Holder;  and (y) on each
         monthly  anniversary of each such Event Date (if the  applicable  Event
         shall not have been cured by such date) until the  applicable  Event is
         cured,  the  Company  shall pay to each  Holder  an amount in cash,  as
         liquidated  damages and not as a penalty,  equal to 1% of the aggregate
         purchase price paid by such Holder  pursuant to the Purchase  Agreement
         for any Registrable Securities then held by such Holder.

         3.       REGISTRATION PROCEDURES

         In connection with the Company's  registration  obligations  hereunder,
the Company shall:


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<PAGE>


                  (a)      Not  less  than  two (2)  Trading  Days  prior to the
         filing of the Registration  Statement or any related  Prospectus or any
         amendment or supplement thereto,  the Company shall, (i) furnish to the
         Holders  copies of all such documents  proposed to be filed  (including
         documents  incorporated  or deemed  incorporated  by  reference  to the
         extent requested by such Person) which documents will be subject to the
         review of such  Holders,  and (ii) cause its  officers  and  directors,
         counsel and independent certified public accountants to respond to such
         inquiries  as  shall  be  necessary,   in  the  reasonable  opinion  of
         respective  counsel to conduct a  reasonable  investigation  within the
         meaning  of  the  Securities  Act.  The  Company  shall  not  file  the
         Registration  Statement or any such  Prospectus  or any  amendments  or
         supplements  thereto  to  which  the  Holders  of  a  majority  of  the
         Registrable   Securities  shall   reasonably   object  in  good  faith.
         Notwithstanding anything herein to the contrary, failure of the Holders
         to object  within two (2) Trading Days of receipt of a proposed  filing
         shall be deemed the Holders' consent to such filing.

                  (b)      (i)  Prepare  and  file  with  the  Commission   such
         amendments,  including post-effective  amendments,  to the Registration
         Statement and the  Prospectus  used in  connection  therewith as may be
         necessary to keep the Registration  Statement continuously effective as
         to the applicable  Registrable Securities for the Effectiveness Period;
         (ii) cause the related  Prospectus to be amended or supplemented by any
         required Prospectus supplement, and as so supplemented or amended to be
         filed pursuant to Rule 424;  (iii) respond as promptly as  commercially
         practicable to any comments  received from the Commission  with respect
         to the Registration Statement or any amendment thereto and, as promptly
         as  reasonably  possible,  upon  request,  provide the Holders true and
         complete  copies  of all  correspondence  from  and  to the  Commission
         relating to the Registration Statement; and (iv) comply in all material
         respects with the provisions of the Securities Act and the Exchange Act
         with respect to the disposition of all Registrable  Securities  covered
         by  the  Registration   Statement  during  the  applicable   period  in
         accordance  with the  intended  methods of  disposition  by the Holders
         thereof  set forth in the  Registration  Statement  as so amended or in
         such Prospectus as so supplemented.

                  (c)      Notify the Holders of  Registrable  Securities  to be
         sold as promptly as commercially practicable (i)(A) when any Prospectus
         supplement or post-effective amendment to the Registration Statement is
         proposed  to be filed;  (B) when the  Commission  notifies  the Company
         whether  there will be a "review"  of the  Registration  Statement  and
         whenever  the  Commission  comments  in  writing  on  the  Registration
         Statement  (the Company  shall upon  request  provide true and complete
         copies  thereof  and  all  written  responses  thereto  to  each of the
         Holders);  and (C) with  respect to the  Registration  Statement or any
         post-effective  amendment,  when the same has become effective; (ii) of
         any  request  by  the   Commission   or  any  other  Federal  or  state
         governmental  authority  during  the  period  of  effectiveness  of the
         Registration   Statement   for   amendments  or   supplements   to  the
         Registration  Statement or  Prospectus or for  additional  information;
         (iii) of the issuance by the  Commission  or any other federal or state
         governmental  authority of any stop order suspending the  effectiveness
         of the  Registration  Statement  covering any or all of the Registrable
         Securities or the initiation of any Proceedings for that purpose;  (iv)
         of the receipt by the Company of any  notification  with respect to the
         suspension of the qualification or exemption from  qualification of any
         of the  Registrable  Securities  for sale in any  jurisdiction,  or the
         initiation or threatening  of


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<PAGE>


         any Proceeding for such purpose; and (v) of the occurrence of any event
         or passage of time that makes the financial  statements included in the
         Registration   Statement   ineligible  for  inclusion  therein  or  any
         statement  made in the  Registration  Statement  or  Prospectus  or any
         document incorporated or deemed to be incorporated therein by reference
         untrue in any material  respect or that  requires any  revisions to the
         Registration  Statement,  Prospectus or other documents so that, in the
         case of the Registration  Statement or the Prospectus,  as the case may
         be, it will not contain any untrue statement of a material fact or omit
         to state any material fact  required to be stated  therein or necessary
         to make the statements  therein,  in light of the  circumstances  under
         which they were made, not misleading.

                  (d)      Use its commercially  reasonable efforts to avoid the
         issuance  of, or, if issued,  obtain  the  withdrawal  of (i) any order
         suspending the effectiveness of the Registration Statement, or (ii) any
         suspension of the  qualification  (or exemption from  qualification) of
         any of the Registrable Securities for sale in any jurisdiction,  at the
         earliest practicable moment.

                  (e)      Furnish to each Holder, without charge, to the extent
         requested  by  such  Holder,   at  least  one  conformed  copy  of  the
         Registration Statement and each amendment thereto,  including financial
         statements and schedules,  all documents  incorporated  or deemed to be
         incorporated  therein by reference  and all exhibits  (including  those
         previously  furnished or  incorporated  by reference),  in each case as
         soon as reasonably practicable following such request by the Holder.

                  (f)      Promptly deliver to each Holder,  without charge,  as
         many copies of the Prospectus or  Prospectuses  (including each form of
         prospectus)  and each  amendment or supplement  thereto as such Persons
         may  reasonably  request in  connection  with  resales by the Holder of
         Registrable Securities.  The Company hereby consents to the use of such
         Prospectus  and each  amendment  or  supplement  thereto by each of the
         selling  Holders  in  connection  with  the  offering  and  sale of the
         Registrable  Securities covered by such Prospectus and any amendment or
         supplement  thereto,  except after the giving of any notice pursuant to
         SECTION 3(c).

                  (g)      Prior to any resale of  Registrable  Securities  by a
         Holder, use its commercially  reasonable efforts to register or qualify
         or  cooperate  with  the  selling   Holders  in  connection   with  the
         registration or  qualification  (or exemption from the  Registration or
         qualification)  of such  Registrable  Securities  for the resale by the
         Holder  under  the  securities  or Blue Sky laws of such  jurisdictions
         within the United States as any Holder reasonably  requests in writing,
         to  keep  each  of the  Registration  or  qualification  (or  exemption
         therefrom)  effective during the Effectiveness Period and to do any and
         all other acts or things reasonably necessary to enable the disposition
         in such  jurisdictions  of the  Registrable  Securities  covered by the
         Registration  Statement;  PROVIDED,  that  the  Company  shall  not  be
         required to qualify generally to do business in any jurisdiction  where
         it is not then so qualified, subject the Company to any material tax in
         any such jurisdiction where it is not then so subject or file a general
         consent to service of process in any such jurisdiction.


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<PAGE>


                  (h)      If  requested  by the  Holders,  cooperate  with  the
         Holders  to  facilitate   the  timely   preparation   and  delivery  of
         certificates  representing  Registrable Securities to be delivered to a
         transferee pursuant to the Registration  Statement,  which certificates
         shall be free, to the extent  permitted by the Purchase  Agreement,  of
         all restrictive legends,  and to enable such Registrable  Securities to
         be in such  denominations  and  registered  in such  names  as any such
         Holders may request.

                  (i)      Upon the  occurrence  of any  event  contemplated  by
         SECTION  3(c)(v),  as promptly as commercially  practicable,  prepare a
         supplement or amendment,  including a post-effective  amendment, to the
         Registration Statement or a supplement to the related Prospectus or any
         document   incorporated  or  deemed  to  be  incorporated   therein  by
         reference,  and file any other required document so that, as thereafter
         delivered,  neither the Registration Statement nor such Prospectus will
         contain  an  untrue  statement  of a  material  fact or omit to state a
         material  fact  required to be stated  therein or necessary to make the
         statements therein, in light of the circumstances under which they were
         made, not misleading.

                  (j)      Comply with all applicable  rules and  regulations of
         the Commission.

                  (k)      The  Company  may  require  each  selling  Holder  to
         furnish to the Company a certified statement as to the number of shares
         of Common Stock  beneficially  owned by such Holder and the Person that
         has voting and dispositive  control over the Shares. Each Holder agrees
         to cooperate with the Company as reasonably requested by the Company in
         connection  with  the  preparation  and  filing  of  the   Registration
         Statement,  unless such Holder has  notified  the Company in writing of
         such  Holder's  election  to exclude all of such  Holder's  Registrable
         Securities from the Registration Statement.

         4.       REGISTRATION  EXPENSES.  All fees and expenses incident to the
performance  of or compliance  with this Agreement by the Company shall be borne
by the Company  whether or not any  Registrable  Securities are sold pursuant to
the Registration  Statement.  The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including,  without  limitation,  fees and expenses (A) with respect to filings
required  to be made with the Trading  Market on which the Common  Stock is then
listed for trading,  and (B) in compliance with applicable  state  securities or
Blue Sky laws), (ii) printing expenses (including, without limitation,  expenses
of printing certificates for Registrable Securities and of printing prospectuses
if the  printing of  prospectuses  is  reasonably  requested by the holders of a
majority of the Registrable Securities included in the Registration  Statement),
(iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Company, (v) Securities Act liability insurance,  if the Company
so desires  such  insurance,  and (vi) fees and  expenses  of all other  Persons
retained by the Company in connection with the  consummation of the transactions
contemplated  by this Agreement.  In addition,  the Company shall be responsible
for all of its internal expenses incurred in connection with the consummation of
the transactions contemplated by this Agreement (including,  without limitation,
all salaries and expenses of its  officers  and  employees  performing  legal or
accounting  duties),  the expense of any annual  audit and the fees and expenses
incurred in  connection  with the listing of the  Registrable  Securities on any
securities exchange as required hereunder.


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<PAGE>


         5.       INDEMNIFICATION

                  (a)      INDEMNIFICATION  BY THE COMPANY.  The Company  shall,
         notwithstanding  any termination of this Agreement,  indemnify and hold
         harmless each Holder, the officers,  directors, agents and employees of
         each of them,  each Person who  controls  any such  Holder  (within the
         meaning  of  Section  15 of the  Securities  Act or  Section  20 of the
         Exchange Act) and the officers, directors, agents and employees of each
         such controlling  Person, to the fullest extent permitted by applicable
         law, from and against any and all losses, claims, damages, liabilities,
         costs (including,  without limitation,  reasonable attorneys' fees) and
         expenses  (collectively,  "LOSSES"), as incurred, to the extent arising
         out of or  relating  to any untrue or  alleged  untrue  statement  of a
         material fact contained in the Registration  Statement,  any Prospectus
         or any form of prospectus or in any amendment or supplement  thereto or
         in any  preliminary  prospectus,  or arising  out of or relating to any
         omission or alleged  omission of a material  fact required to be stated
         therein or necessary to make the statements therein (in the case of any
         Prospectus or form of prospectus or supplement thereto, in light of the
         circumstances under which they were made) not misleading, except to the
         extent,  but only to the  extent,  that (1) such untrue  statements  or
         omissions  are based  solely  upon  information  regarding  such Holder
         furnished  in writing to the Company by such Holder  expressly  for use
         therein,  or to the extent that such information relates to such Holder
         or  such  Holder's  proposed  method  of  distribution  of  Registrable
         Securities  and was reviewed and expressly  approved in writing by such
         Holder expressly for use in the Registration Statement, such Prospectus
         or such form of Prospectus  or in any  amendment or supplement  thereto
         (it being  understood  that the Holder has approved  ANNEX A hereto for
         this  purpose),  or (2) in the case of an occurrence of an event of the
         type  specified in SECTION  3(c)(ii)-(v),  the use by such Holder of an
         outdated or defective  Prospectus  after the Company has notified  such
         Holder in writing  that the  Prospectus  is outdated or  defective  and
         prior to the  receipt  by such  Holder of the  Advice  contemplated  in
         SECTION  6(c).  The Company  shall  notify the Holders  promptly of the
         institution, threat or assertion of any Proceeding of which the Company
         is  aware in  connection  with the  transactions  contemplated  by this
         Agreement.

                  (b)      INDEMNIFICATION   BY  HOLDERS.   Each  Holder  shall,
         severally and not jointly, indemnify and hold harmless the Company, its
         directors, officers, agents and employees, each Person who controls the
         Company  (within  the meaning of Section 15 of the  Securities  Act and
         Section 20 of the Exchange Act), and the directors, officers, agents or
         employees of such controlling  Persons, to the fullest extent permitted
         by  applicable  law, from and against all Losses,  as incurred,  to the
         extent  arising  out of or based  upon:  (x) such  Holder's  failure to
         comply with the prospectus delivery  requirements of the Securities Act
         or (y) any  untrue or  alleged  untrue  statement  of a  material  fact
         contained in any Registration Statement, any Prospectus, or any form of
         prospectus,  or in  any  amendment  or  supplement  thereto  or in  any
         preliminary  prospectus,  or arising out of or relating to any omission
         or alleged omission of a material fact required to be stated therein or
         necessary  to make the  statements  therein not  misleading  (i) to the
         extent, but only to the extent,  that such untrue statement or omission
         is contained in any  information so furnished in writing by such Holder
         to the Company specifically for inclusion in the Registration Statement
         or  such  Prospectus,  or (ii)  to the  extent  that  (1)  such  untrue
         statements  or omissions  are based solely upon  information  regarding
         such  Holder


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<PAGE>


         furnished  in writing to the Company by such Holder  expressly  for use
         therein,  or to the extent that such information relates to such Holder
         or  such  Holder's  proposed  method  of  distribution  of  Registrable
         Securities  and was reviewed and expressly  approved in writing by such
         Holder  expressly  for  use in the  Registration  Statement  (it  being
         understood  that  the  Holder  has  approved  ANNEX A  hereto  for this
         purpose),  such  Prospectus  or  such  form  of  Prospectus  or in  any
         amendment or supplement  thereto or (2) in the case of an occurrence of
         an event of the type specified in SECTION 3(c)(ii)-(v), the use by such
         Holder of an outdated  or  defective  Prospectus  after the Company has
         notified  such  Holder in writing  that the  Prospectus  is outdated or
         defective  and  prior  to the  receipt  by such  Holder  of the  Advice
         contemplated  in SECTION  6(c).  In no event shall the liability of any
         selling Holder hereunder be greater in amount than the dollar amount of
         the  net  proceeds  received  by  such  Holder  upon  the  sale  of the
         Registrable Securities giving rise to such indemnification obligation.

                  (c)      CONDUCT  OF  INDEMNIFICATION   PROCEEDINGS.   If  any
         Proceeding  shall be brought or asserted against any Person entitled to
         indemnity  hereunder (an "INDEMNIFIED  PARTY"),  such Indemnified Party
         shall  promptly  notify the Person from whom  indemnity  is sought (the
         "INDEMNIFYING PARTY") in writing, and the Indemnifying Party shall have
         the right to assume the defense  thereof,  including the  employment of
         counsel  reasonably  satisfactory  to the  Indemnified  Party  and  the
         payment of all fees and expenses  incurred in  connection  with defense
         thereof;  provided,  that the failure of any Indemnified  Party to give
         such notice shall not relieve the Indemnifying Party of its obligations
         or  liabilities  pursuant to this  Agreement,  except (and only) to the
         extent  that it shall be  finally  determined  by a court of  competent
         jurisdiction  (which  determination is not subject to appeal or further
         review) that such failure shall have prejudiced the Indemnifying Party.

                  An Indemnified  Party shall have the right to employ  separate
         counsel  in any  such  Proceeding  and to  participate  in the  defense
         thereof,  but the fees and  expenses  of such  counsel  shall be at the
         expense  of  such  Indemnified   Party  or  Parties  unless:   (1)  the
         Indemnifying Party has agreed in writing to pay such fees and expenses;
         (2) the  Indemnifying  Party shall have  failed  promptly to assume the
         defense  of  such   Proceeding   and  to  employ   counsel   reasonably
         satisfactory to such Indemnified  Party in any such Proceeding;  or (3)
         the named  parties  to any such  Proceeding  (including  any  impleaded
         parties)  include  both such  Indemnified  Party  and the  Indemnifying
         Party,  and such  Indemnified  Party shall have been advised by counsel
         that a conflict of interest is likely to exist if the same counsel were
         to represent  such  Indemnified  Party and the  Indemnifying  Party (in
         which case, if such Indemnified  Party notifies the Indemnifying  Party
         in writing that it elects to employ separate  counsel at the expense of
         the Indemnifying Party, the Indemnifying Party shall not have the right
         to assume the defense  thereof and the reasonable  fees and expenses of
         one  separate  counsel  shall  be at the  expense  of the  Indemnifying
         Party).  The Indemnifying  Party shall not be liable for any settlement
         of any such  Proceeding  effected  without its written  consent,  which
         consent  shall not be  unreasonably  withheld.  No  Indemnifying  Party
         shall,  without the prior  written  consent of the  Indemnified  Party,
         effect any settlement of any pending Proceeding in respect of which any
         Indemnified  Party is a  party,  unless  such  settlement  includes  an
         unconditional  release of such Indemnified  Party from all liability on
         claims that are the subject matter of such Proceeding.


                                       8
<PAGE>


                  All  reasonable  fees and  expenses of the  Indemnified  Party
         (including  reasonable  fees and  expenses  to the extent  incurred  in
         connection with investigating or preparing to defend such Proceeding in
         a manner  not  inconsistent  with  this  Section)  shall be paid to the
         Indemnified Party, as incurred, within ten (10) Trading Days of written
         notice  thereof  to  the  Indemnifying   Party;   PROVIDED,   that  the
         Indemnified Party shall promptly  reimburse the Indemnifying  Party for
         that portion of such fees and expenses  applicable  to such actions for
         which  such  Indemnified  Party  is  not  entitled  to  indemnification
         hereunder, determined based upon the relative faults of the parties.

                  (d)      CONTRIBUTION.  If a claim for  indemnification  under
         SECTION 5(a) or 5(b) is unavailable to an Indemnified  Party (by reason
         of public policy or otherwise),  then each Indemnifying  Party, in lieu
         of indemnifying such Indemnified  Party, shall contribute to the amount
         paid or payable by such  Indemnified  Party as a result of such Losses,
         in such  proportion as is  appropriate to reflect the relative fault of
         the  Indemnifying  Party and  Indemnified  Party in connection with the
         actions,  statements or omissions  that resulted in such Losses as well
         as any other relevant equitable  considerations.  The relative fault of
         such  Indemnifying  Party and Indemnified  Party shall be determined by
         reference  to,  among other  things,  whether  any action in  question,
         including any untrue or alleged untrue  statement of a material fact or
         omission or alleged omission of a material fact, has been taken or made
         by, or relates to information  supplied by, such Indemnifying  Party or
         Indemnified Party, and the parties' relative intent, knowledge,  access
         to  information  and  opportunity  to correct or prevent  such  action,
         statement  or  omission.  The  amount  paid or  payable by a party as a
         result  of any  Losses  shall be  deemed  to  include,  subject  to the
         limitations  set forth in SECTION 5(c),  any  reasonable  attorneys' or
         other reasonable fees or expenses  incurred by such party in connection
         with  any   Proceeding  to  the  extent  such  party  would  have  been
         indemnified for such fees or expenses if the  indemnification  provided
         for in this Section was available to such party in accordance  with its
         terms.

                  The  parties  hereto  agree  that it  would  not be  just  and
         equitable if contribution pursuant to this SECTION 5(d) were determined
         by pro rata  allocation or by any other method of allocation  that does
         not take into account the equitable  considerations  referred to in the
         immediately preceding paragraph. Notwithstanding the provisions of this
         SECTION  5(d),  no  Holder  shall be  required  to  contribute,  in the
         aggregate,  any  amount in excess of the  amount by which the  proceeds
         actually  received  by such  Holder  from the  sale of the  Registrable
         Securities  subject to the Proceeding exceeds the amount of any damages
         that such Holder has  otherwise  been required to pay by reason of such
         untrue or alleged  untrue  statement  or omission or alleged  omission,
         except in the case of fraud by such Holder.

                  The indemnity and  contribution  agreements  contained in this
         Section are in addition to any liability that the Indemnifying  Parties
         may have to the Indemnified Parties.

         6.       MISCELLANEOUS

                  (a)      REMEDIES.  In the event of a breach by the Company or
         by a Holder,  of any of their  obligations  under this Agreement,  each
         Holder  or the  Company,  as the  case


                                       9
<PAGE>


         may be, in addition to being entitled to exercise all rights granted by
         law and under this Agreement,  including  recovery of damages,  will be
         entitled to specific  performance  of its rights under this  Agreement.
         The Company  and each  Holder  agree that  monetary  damages  would not
         provide  adequate  compensation  for any losses incurred by reason of a
         breach by it of any of the  provisions  of this  Agreement  and  hereby
         further   agrees  that,  in  the  event  of  any  action  for  specific
         performance in respect of such breach,  it shall waive the defense that
         a remedy at law would be adequate.

                  (b)      NO PIGGYBACK ON REGISTRATIONS. Except as set forth in
         the Disclosure Schedules to the Purchase Agreement, neither the Company
         nor  any of its  security  holders  (other  than  the  Holders  in such
         capacity  pursuant  hereto) may include  securities of the Company in a
         Registration Statement other than the Registrable  Securities,  and the
         Company  shall not  after  the date  hereof  enter  into any  agreement
         providing any such right to any of its security holders.  Except as set
         forth in the SEC Reports or the  Disclosure  Schedules  to the Purchase
         Agreement,  no Person has any right to cause the  Company to effect the
         registration under the Securities Act of any securities of the Company.

                  (c)      COMPLIANCE.  Each Holder covenants and agrees that it
         will comply with the prospectus delivery requirements of the Securities
         Act  as  applicable  to it in  connection  with  sales  of  Registrable
         Securities pursuant to the Registration Statement.

                  (d)      DISCONTINUED  DISPOSITION.  Each Holder agrees by its
         acquisition  of such  Registrable  Securities  that,  upon receipt of a
         notice  from the  Company  of the  occurrence  of any event of the kind
         described  in Section  3(c),  such  Holder will  forthwith  discontinue
         disposition  of such  Registrable  Securities  under  the  Registration
         Statement until such Holder's receipt of the copies of the supplemented
         Prospectus and/or amended Registration Statement or until it is advised
         in writing  (the  "ADVICE")  by the Company  ------ that the use of the
         applicable Prospectus may be resumed, and, in either case, has received
         copies of any additional or supplemental  filings that are incorporated
         or  deemed  to be  incorporated  by  reference  in such  Prospectus  or
         Registration Statement. The Company may provide appropriate stop orders
         to enforce the provisions of this paragraph.

                  (e)      PIGGY-BACK  REGISTRATIONS.  If at any time during the
         Effectiveness Period there is not an effective  Registration  Statement
         covering  all of the  Registrable  Securities  and  the  Company  shall
         determine  to  prepare  and file  with the  Commission  a  registration
         statement relating to an offering for its own account or the account of
         others under the Securities Act of any of its equity securities,  other
         than on Form S-4 or Form S-8 (each as promulgated  under the Securities
         Act) or their then  equivalents  relating  to equity  securities  to be
         issued  solely in  connection  with any  acquisition  of any  entity or
         business or equity  securities  issuable in  connection  with the stock
         option or other employee benefit plans,  then the Company shall send to
         each  Holder a written  notice  of such  determination  and,  if within
         fifteen (15) days after the date of such notice,  any such Holder shall
         so request in writing,  the Company shall include in such  registration
         statement all or any part of such  Registrable  Securities  such Holder
         requests to be registered,  subject to customary  underwriter  cutbacks
         applicable to all holders of registration rights.


                                       10
<PAGE>


                  (f)      AMENDMENTS  AND  WAIVERS.   The  provisions  of  this
         Agreement,  including  the  provisions  of  this  sentence,  may not be
         amended,   modified  or  supplemented,   and  waivers  or  consents  to
         departures from the provisions hereof may not be given, unless the same
         shall be in writing  and signed by the  Company  and each Holder of the
         then outstanding Registrable Securities.

                  (g)      NOTICES.  Any and all notices or other communications
         or deliveries  required or permitted to be provided  hereunder shall be
         in writing and shall be deemed  given and  effective on the earliest of
         (i) the  date of  transmission,  if such  notice  or  communication  is
         delivered via facsimile or electronic  mail at the facsimile  number or
         e-mail  address  provided for in the Purchase  Agreement  prior to 6:30
         p.m.  (New York City time) on a Trading Day, (ii) the Trading Day after
         the date of transmission,  if such notice or communication is delivered
         via  facsimile or  electronic  mail at the  facsimile  number or e-mail
         address  provided  for in the Purchase  Agreement  later than 6:30 p.m.
         (New York City time) on any date and earlier than 11:59 p.m.  (New York
         City time) on such date,  (iii) the Trading Day  following  the date of
         mailing, if sent by nationally recognized overnight courier service, or
         (iv) upon  actual  receipt by the party to whom such notice is required
         to be given. The address for such notices and  communications  shall be
         delivered and addressed as set forth in the Purchase Agreement.

                  (h)      SUCCESSORS AND ASSIGNS. This Agreement shall inure to
         the benefit of and be binding upon the successors and permitted assigns
         of each of the parties  and shall inure to the benefit of each  Holder.
         Each Holder may assign their respective  rights hereunder in the manner
         and to the Persons as permitted under the Purchase Agreement.

                  (i)      EXECUTION  AND  COUNTERPARTS.  This  Agreement may be
         executed in any number of counterparts,  each of which when so executed
         shall be deemed to be an  original  and,  all of which  taken  together
         shall  constitute  one and the same  Agreement.  In the event  that any
         signature is delivered by facsimile transmission,  such signature shall
         create a valid binding  obligation of the party  executing (or on whose
         behalf such  signature  is  executed)  the same with the same force and
         effect as if such facsimile signature were the original thereof.

                  (j)      GOVERNING   LAW.   All   questions   concerning   the
         construction,   validity,   enforcement  and   interpretation  of  this
         Agreement shall be governed by and construed and enforced in accordance
         with the internal laws of the State of  California,  without  regard to
         the principles of conflicts of law thereof.  Each party agrees that all
         legal  proceedings  concerning  the  interpretations,  enforcement  and
         defense of the  transactions  contemplated  by this Agreement  (whether
         brought against a party hereto or its respective affiliates, directors,
         officers,  shareholders,   employees  or  agents)  shall  be  commenced
         exclusively  in the state and  federal  courts  sitting in Los  Angeles
         County, California. Each party hereto hereby irrevocably submits to the
         exclusive  jurisdiction  of the state and federal courts sitting in Los
         Angeles  County,   California  for  the  adjudication  of  any  dispute
         hereunder   or  in   connection   herewith  or  with  any   transaction
         contemplated  hereby or discussed herein (including with respect to the
         enforcement  of the  any of this  Agreement),  and  hereby


                                       11
<PAGE>


         irrevocably  waives,  and agrees  not to assert in any suit,  action or
         proceeding,  any  claim  that  it is  not  personally  subject  to  the
         jurisdiction of any such court, that such suit, action or proceeding is
         improper.  Each party hereto hereby irrevocably waives personal service
         of  process  and  consents  to process  being  served in any such suit,
         action or  proceeding  by  mailing a copy  thereof  via  registered  or
         certified  mail or overnight  delivery  (with  evidence of delivery) to
         such  party at the  address  in effect  for  notices  to it under  this
         Agreement  and  agrees  that such  service  shall  constitute  good and
         sufficient  service of process and notice  thereof.  Nothing  contained
         herein  shall be deemed to limit in any way any right to serve  process
         in any manner  permitted by law. Each party hereto  hereby  irrevocably
         waives,  to the fullest extent permitted by applicable law, any and all
         right  to  trial  by jury in any  legal  proceeding  arising  out of or
         relating to this Agreement or the transactions  contemplated hereby. If
         either  party  shall  commence an action or  proceeding  to enforce any
         provisions of this Agreement,  then the prevailing party in such action
         or proceeding  shall be reimbursed by the other party for its attorneys
         fees and other  costs and  expenses  incurred  with the  investigation,
         preparation and prosecution of such action or proceeding.

                  (k)      CUMULATIVE REMEDIES. The remedies provided herein are
         cumulative and not exclusive of any remedies provided by law.

                  (l)      SEVERABILITY.  If any term,  provision,  covenant  or
         restriction  of  this  Agreement  is  held  by  a  court  of  competent
         jurisdiction  to  be  invalid,  illegal,  void  or  unenforceable,  the
         remainder of the terms,  provisions,  covenants  and  restrictions  set
         forth  herein shall remain in full force and effect and shall in no way
         be affected, impaired or invalidated,  and the parties hereto shall use
         their commercially reasonable efforts to find and employ an alternative
         means to  achieve  the same or  substantially  the same  result as that
         contemplated by such term,  provision,  covenant or restriction.  It is
         hereby  stipulated and declared to be the intention of the parties that
         they would have executed the remaining terms, provisions, covenants and
         restrictions  without  including  any of  such  that  may be  hereafter
         declared invalid, illegal, void or unenforceable.

                  (m)      HEADINGS.  The  headings  in this  Agreement  are for
         convenience of reference  only and shall not limit or otherwise  affect
         the meaning hereof.

                  (n)      INDEPENDENT  NATURE OF  PURCHASERS'  OBLIGATIONS  AND
         RIGHTS. The obligations of each Purchaser hereunder are several and not
         joint with the  obligations of any other  Purchaser  hereunder,  and no
         Purchaser  shall be responsible  in any way for the  performance of the
         obligations of any other Purchaser hereunder.  Nothing contained herein
         or in any other agreement or document delivered at any closing,  and no
         action  taken by any  Purchaser  pursuant  hereto or thereto,  shall be
         deemed to constitute the Purchasers as a partnership, an association, a
         joint venture or any other kind of entity, or create a presumption that
         the  Purchasers  are in any way acting in concert  with respect to such
         obligations or the  transactions  contemplated by this Agreement.  Each
         Purchaser  shall  be  entitled  to  protect  and  enforce  its  rights,
         including without  limitation the rights arising out of this Agreement,
         and it shall not be necessary  for any other  Purchaser to be joined as
         an additional party in any proceeding for such purpose.


                                       12
<PAGE>


                 IN  WITNESS   WHEREOF,   the  parties   have   executed   this
Registration Rights Agreement as of the date first written above.

                                         ELECTRONIC CLEARING HOUSE, INC.


                                         By: ___________________________________
                                         Name:
                                         Title:



                           [SIGNATURE PAGE CONTINUES]


                                      S-1
<PAGE>


          [PURCHASER SIGNATURE PAGES TO REGISTRATION RIGHTS AGREEMENT]


                                                   [___________________________]

                                                   By:  ________________________
                                                        Name:
                                                        Title:

                           [SIGNATURE PAGE CONTINUES]


                                      S-2
<PAGE>


          [PURCHASER SIGNATURE PAGES TO REGISTRATION RIGHTS AGREEMENT]


                                                   [___________________________]

                                                   By:  ________________________
                                                        Name:
                                                        Title:

                           [SIGNATURE PAGE CONTINUES]


                                      S-3
<PAGE>


                                     ANNEX A

                              PLAN OF DISTRIBUTION

         The  Selling  Stockholders  and any of their  pledgees,  assignees  and
successors-in-interest  may, from time to time,  sell any or all of their shares
of Common Stock on any stock exchange,  market or trading  facility on which the
shares  are traded or in private  transactions.  These  sales may be at fixed or
negotiated  prices.  The  Selling  Stockholders  may  use any one or more of the
following methods when selling shares:

         o        ordinary brokerage  transactions and transactions in which the
                  broker-dealer solicits purchasers;

         o        block trades in which the  broker-dealer  will attempt to sell
                  the shares as agent but may  position  and resell a portion of
                  the block as principal to facilitate the transaction;

         o        purchases by a  broker-dealer  as principal  and resale by the
                  broker-dealer for its account;

         o        an exchange  distribution  in accordance with the rules of the
                  applicable exchange;

         o        privately negotiated transactions;

         o        settlement of short sales;

         o        broker-dealers may agree with the Selling Stockholders to sell
                  a specified  number of such shares at a  stipulated  price per
                  share;

         o        a combination of any such methods of sale; and

         o        any other method permitted pursuant to applicable law.

         The Selling  Stockholders may also sell shares under Rule 144 under the
Securities Act, if available, rather than under this prospectus.

         Broker-dealers  engaged by the  Selling  Stockholders  may  arrange for
other  brokers-dealers  to  participate  in sales.  Broker-dealers  may  receive
commissions or discounts from the Selling Stockholders (or, if any broker-dealer
acts as agent for the purchaser of shares,  from the purchaser) in amounts to be
negotiated.  The  Selling  Stockholders  do not  expect  these  commissions  and
discounts to exceed what is customary in the types of transactions involved.

         The  Selling  Stockholders  may  from  time to time  pledge  or grant a
security  interest  in some or all of the shares of common  stock  owned by them
and,  if they  default in the  performance  of their  secured  obligations,  the
pledgees or secured  parties may offer and sell the shares of common  stock from
time to time under this  prospectus,  or under an amendment  to this  prospectus
under Rule 424(b)(3) or other applicable provision of the Securities Act of 1933


                                    Annex A-1
<PAGE>


amending the list of Selling Stockholders to include the pledgee,  transferee or
other successors in interest as Selling Stockholders under this prospectus.

         The  Selling  Stockholders  and any  broker-dealers  or agents that are
involved  in selling  the shares may be deemed to be  "underwriters"  within the
meaning of the Securities Act in connection with such sales. In such event,  any
commissions  received  by such  broker-dealers  or agents  and any profit on the
resale  of the  shares  purchased  by  them  may be  deemed  to be  underwriting
commissions or discounts under the Securities Act. The Selling Stockholders have
informed  the  Company  that it does not have any  agreement  or  understanding,
directly or indirectly, with any person to distribute the Common Stock.

         The Company is required  to pay all fees and  expenses  incident to the
registration  of the shares.  The Company  has agreed to  indemnify  the Selling
Stockholders against certain losses, claims, damages and liabilities,  including
liabilities under the Securities Act.


                                   Annex A-2

</TEXT>
</DOCUMENT>
