EXECUTIVE EMPLOYMENT AGREEMENT OF
                                 HENRY M. BAROCO

         This Executive Employment Agreement ("AGREEMENT") is entered into
between PRIVATE BUSINESS, INC., a Tennessee corporation ("COMPANY"), and HENRY
M. BAROCO, a resident of Georgia ("EXECUTIVE"), executed as of August 10, 2001
and effective as of the Effective Date (as defined below). The Company and the
Executive are sometimes referred to herein as the "PARTIES."

1. Introduction. Pursuant to an Agreement and Plan of Merger between the
Company, Towne Services, Inc., and Towne Acquisition Corporation, a wholly owned
subsidiary of the Company, as of the date of the consummation of the merger
contemplated by such Agreement and Plan of Merger, Towne Acquisition Corporation
will merge with and into Towne Services, Inc. (the "EFFECTIVE DATE"). The
Company desires to employ Executive and the Executive desires to be employed by
the Company as of the Effective Date. Accordingly, the Company and the Executive
intend by this Agreement to specify the terms and conditions of the Executive's
employment relationship with the Company.

2. Employment. As of the Effective Date, the Company hereby employs the
Executive and the Executive hereby accepts employment with the Company upon
terms and conditions set forth herein.

3. Duties and Responsibilities.

   3.1 Extent of Service. The Executive shall, during the term of this
Agreement, devote such of his entire time, attention, energies and business
efforts to his duties as an executive of the Company as are reasonably necessary
to carry out his duties specified in Paragraph 3.2 below. The Executive shall
not, during the term of this Agreement, engage in any other business activity
(whether or not such business activity is pursued for gain, profit or other
pecuniary advantage) if such business activity would impair the Executive's
ability to carry out his duties hereunder. This Paragraph 3.1, however, shall
not be construed to prevent the Executive from investing his personal assets as
a passive investor.

   3.2 Position and Duties. Subject to the power of the Board of Directors of
the Company to elect and remove officers, the Executive shall serve the Company
as Chief Operating Officer of the Company; and shall perform, faithfully and
diligently, the services and functions relating to such office (or otherwise
reasonably incident to such office) as may be designated from time to time by
the Board of Directors of the Company or its designee(s); provided that all such
services and functions shall be reasonable and within the Executive's area of
expertise, and provided further that the Executive shall be physically capable
of performing the same. Furthermore, in the event Executive is employed by the
Company on January 1, 2002 and subject to the power of the Board of Directors of
the Company to elect and remove officers, the Executive shall also serve the
Company as President of the Company, upon appointment by the Company's Board of


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Directors; and shall perform, faithfully and diligently, the services and
functions relating to such office (or otherwise reasonably incident to such
office) as may be designated from time to time by the Board of Directors of the
Company or its designee(s); provided that all such services and functions shall
be reasonable and within the Executive's area of expertise, and provided further
that the Executive shall be physically capable of performing the same.

   3.3 Place of Employment. During the term of this Agreement, the Company shall
maintain its principal executive offices in the Nashville, Tennessee area, and
the Executive's primary place of employment shall be at such principal executive
offices. During the term of this Agreement, the Company will provide the
Executive with a private office and other customary staff support services
commensurate with the services and functions to be performed by him hereunder.

4. Salary and Other Benefits. Subject to the terms and conditions of this
Agreement:

   4.1 Salary. As compensation for his services during the term of his
employment under this Agreement, the Executive shall be paid at an annual rate
of not less than Two Hundred Twenty Five Thousand Dollars ($225,000), payable in
accordance with the then current payroll policies of the Company. Such salary
shall be subject to increase by the Board of Directors of the Company (or the
appropriate committee thereof) from time to time. The annual salary payable from
time to time by the Company to the Executive pursuant to this Paragraph 4.1 is
herein sometimes referred to as his "BASE SALARY. "

   4.2 Incentive Bonus Eligibility. Beginning with calendar year 2001 (prorated
from the Effective Date as to 2001), Executive shall be eligible to be paid an
annual incentive cash bonus ("BONUS") of up to one hundred percent (100%) of his
Base Salary subject to performance criteria for the Company and Executive
established from time to time by the Board of Directors, or its designee(s), and
Executive.

   4.3 Stock Option Grants.

       (a) General. Executive may be granted options to acquire shares of the
   Company's common stock at anytime at the discretion of the Board. Such grant
   shall be made pursuant to an Incentive Stock Option Agreement between the
   Company and Executive to the extent Executive is eligible for incentive
   options under applicable tax laws and, with respect to any excess, a
   Non-Qualified Stock Option Agreement between the Company and the Executive.
   In all events such options shall be subject to the terms and conditions of
   the Company's 1999 Amended and Restated Stock Option Plan, as the same may be
   amended from time to time (the "STOCK OPTION PLAN").


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       (b) Initial Grant. As of the Effective Date, the Company shall grant
   Executive an option to purchase 200,000 shares of Company common stock in
   accordance with the terms of Paragraph 4.3(a) and pursuant to the Stock
   Option Plan (the "INITIAL OPTION GRANT"). One-half of the Initial Option
   Grant (or options to purchase 100,000 shares) shall vest on December 31, 2001
   provided Executive remains employed on such date, and, beginning on the
   Effective Date, the remaining one-half of the Initial Option Grant shall vest
   1/48th per month of continued employment by the Executive on the last
   calendar day of each such month provided Executive remains employed on each
   such date.

       (c) Towne Options. Pursuant to the terms of the Agreement and Plan of
   Merger, the 294,685 outstanding stock options granted by Towne Services, Inc.
   to Executive prior to the Effective Date shall be assumed by the Company.

   4.4 Other Benefits. As long as the Executive is employed by the Company, the
Executive shall be entitled to receive the following benefits in addition to his
Base Salary:

       (a) The Executive shall have the right to participate in all group
   benefit plans of the Company in accordance with the Company's regular
   practices with respect to its senior officers; provided, however, that the
   Company shall pay for all premiums and deductibles for Executive's health
   insurance under such group benefit plans.

       (b) The Executive shall be entitled to reimbursement from the Company for
   reasonable out-of-pocket expenses incurred by him in the course of the
   performance of his duties hereunder, subject to compliance with the Company's
   standard expense policies and procedures.

       (c) The Executive shall be entitled to such vacation, holidays and other
   paid or unpaid leaves of absence as are consistent with the Company's policy
   for other senior officers.

   4.5 Housing. From the Effective Date until December 31, 2001, subject to
Executive's continued employment by the Company, the Company shall provide
Executive a two bedroom furnished apartment, including utilities.

   4.6 Automobile. On the Effective Date, the Company shall transfer to the
Executive title to the Company vehicle currently utilized by Executive.

   4.7 Acknowledgment. The Executive acknowledges that he has forgiven a portion
of his employment agreement with Towne Services, Inc. ("TOWNE") in return for
forgiveness of a note with Towne. Towne agreed to recognize the associated
salary expense (for tax purposes) over a sixty (60) month period beginning
February 2001. The Company agrees to continue to recognize the associated salary
expense in the same manner provided that Executive remains employed with the
Company. Should the Company terminate Executive's employment hereunder other
than for cause, Executive resign for any reason, or this agreement not be
renewed, the Company will recognize any outstanding portion in twenty-four (24)
monthly installments. If the Company terminates


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Executive's employment for cause, any remaining unrecognized associated salary
expense as of the Executive's last day of employment will be expensed.

5. Term. The term of this Agreement shall be from the Effective Date until
December 31, 2001 (the "INITIAL TERM"), and shall thereafter automatically be
extended for an additional period of one (1) year on a yearly basis, provided,
however, that on or after December 1, 2001, either the Executive or the Company
may terminate this Agreement by giving the other party thirty (30) days advance
notice that such party intends to terminate this Agreement.

6. Termination and Resignation. Notwithstanding Paragraph 5, the Company shall
have the right to terminate the Executive's employment hereunder at any time and
for any reason, and upon any such termination the Executive shall be entitled to
receive from the Company prompt payment of the amount determined pursuant to the
applicable subparagraph of Paragraph 7 below. The Executive shall have the right
to terminate his employment hereunder at any time by resignation, and he shall
thereupon be entitled to receive from the Company payment of the amount
determined pursuant to the applicable subparagraph of Paragraph 7 below.

7. Payments Upon Termination and Resignation.

   7.1 Pro Rata Payments. If (a) the Company at any time terminates the
Executive's employment for Cause (as defined below), or (b) prior to January 1,
2002, the Executive voluntarily resigns for any reason other than an uncured
material breach by the Company of any term of this Agreement, then in each case
the Executive shall be entitled to receive only his Base Salary on a pro rata
basis to the date of termination plus any amounts due Executive through the date
of termination in accordance with Paragraph 4.4. If the Executive during the
term of this Agreement dies or becomes disabled (being the inability of the
Executive to perform his normal employment duties for any six (6) months during
any twelve (12) month period because of either physical or mental incapacity),
the Executive or his estate shall be entitled to receive any amounts due
Executive pursuant to Paragraph 4.4 and to receive his Base Salary plus Bonus on
a pro rata basis to the date of termination or resignation. For purposes of this
Paragraph 7.1, "pro rata" shall mean the product of the Executive's annual Base
Salary and Bonus that would have been payable had the Executive's employment not
terminated multiplied by a fraction the denominator of which is 365 and the
numerator of which is the number of days during the calendar year that have
passed through the date of the termination of the Executive's employment.

   7.2 Multiple Base Salary. If (a) after January 1, 2002, Executive resigns for
any reason, (b) the Company at any time terminates the Executive's employment
without Cause, (c) the Company fails to renew Executive's employment effective
after the Initial Term, or (d) prior to January 1, 2002, Executive resigns
because of an uncured material breach by the Company of any term of this
Agreement, then in each case:

   (i) the Company will pay to the Executive, in equal 1/24 monthly payments
over a term of two (2) years, a payment of Nine Hundred Thirty Thousand Dollars
($930,000) as consideration for Executive's continued compliance with the
restrictive covenants set forth in Paragraphs 9.1, 9.2 and 9.3 of this Agreement
and as consideration for Executive's


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obligation to provide certain consulting services to the Company as set forth
in Paragraph 9.7 of this Agreement;

   (ii) any vested options previously granted to the Executive by the Company
shall remain exercisable for the remainder of their stated term; and

   (iii) for the period from the termination date until the date Executive
reaches the age sixty-five (65) (or, with respect to benefits provided to
Executive's spouse, until the date Executive's spouse reaches the age sixty-five
(65)) (the "CONTINUATION PERIOD"), the Company shall at its expense on behalf of
the Executive and his spouse arrange for the continuation of the life insurance,
disability, medical, dental and hospitalization benefits provided (x) to the
Executive at any time during the 90-day period prior to the date of such
termination or at any time thereafter or (y) to other similarly situated
executives who are in the employ of the Company during the Continuation Period.
Nothing provided herein shall be construed to limit Executive's post-employment
continuation rights under COBRA, and to the extent any such benefits are
continued pursuant to COBRA, the Company shall periodically reimburse Executive
for his out-of-pocket premiums for benefits continued pursuant to COBRA. The
coverage and benefits (including deductibles and costs) provided in this
Paragraph 7.3(iii) during the Continuation Period shall be no less favorable to
the Executive and his dependents and beneficiaries than the most favorable of
such coverages and benefits during any of the periods referred to in clauses (x)
and (y) above. The Company's obligation hereunder with respect to the foregoing
benefits shall be limited to the extent that the Executive obtains any such
benefits pursuant to a subsequent employer's benefit plans, in which case the
Company may reduce the coverage of any benefits it is required to provide the
Executive hereunder as long as the aggregate coverages and benefits of the
combined benefit plans is no less favorable to the Executive than the coverages
and benefits required to be provided hereunder. This subsection (iii) shall not
be interpreted so as to limit any benefits to which the Executive or his
dependents or beneficiaries may be entitled under any of the Company's employee
benefit plans, programs or practices following the Executive's termination of
employment, including without limitation, retiree medical and life insurance
benefits.

   7.3 Certain Definitions. The following terms not defined elsewhere in this
Agreement shall have the following definitions:

       (a) Termination by the Company of the Executive's employment for "CAUSE"
   shall mean termination upon a fraudulent act, the willful misappropriation of
   funds or properties of the Company, or the willful contravention of the
   standards referred to in the last sentence of Paragraph 8 below. For purposes
   of this definition, no act, or failure to act, on the Executive's part shall
   be considered "willful" unless done, or omitted to be done, by the Executive
   not in good faith and without reasonable belief that the Executive's action
   or omission was in the best interest of the Company. Notwithstanding the
   foregoing, the Executive shall not be deemed to have been terminated for
   Cause unless and until there shall have been delivered to the Executive a
   copy of a resolution, duly adopted by the affirmative vote of not less than
   one half (1/2) of the entire membership of the Board of Directors of the
   Company at a meeting of the Board duly called and held (after reasonable
   notice to the Executive and an opportunity for the Executive, together


<PAGE>

   with his counsel, to be heard before the Board) finding that in the good
   faith opinion of the Board the Executive was guilty of the conduct set forth
   above and specifying the particulars thereof in detail.

       (b) The "CODE" shall refer to the Internal Revenue of 1986, as amended.

       (c) A "MATERIAL BREACH" by the Company of this Agreement shall include,
   without limitation, the removal of the Executive without his prior written
   consent from the position of Chief Operating Officer (except in the event of
   termination for Cause) and the Company's failure during the Restricted Period
   to pay Executive any payments due Executive pursuant to Paragraph 7.2(i),
   which failure is not cured by the Company within ten (10) days following
   receipt of written notice thereof from Executive.

8. Preservation of Business; Fiduciary Responsibility. The Executive shall use
his best efforts to preserve the business and organization of the Company, to
keep available to the Company the services of present employees and to preserve
the business relations of the Company with suppliers, distributors, customers
and others. The Executive shall not knowingly commit any act, or in any way
assist others to commit any act, which would directly injure the Company. So
long as the Executive is employed by the Company, the Executive shall observe
and fulfill applicable standards of fiduciary responsibility attendant upon his
service and office.

9. Restrictive Covenants.

   9.1 Non-Compete. During the term of this Agreement (including any renewal
periods as provided in Paragraph 5) and for a period of twenty-four (24) months
following the termination of Executive's employment with the Company under this
Agreement, whether Executive's employment terminates pursuant to the provisions
of Paragraph 6 of this Agreement or otherwise (collectively, the "RESTRICTED
PERIOD"), Executive covenants and agrees that he will not, without the express
approval of the Board of Directors, directly or indirectly anywhere in the
continental United States engage in any activity which is, or participate or
invest in, or provide or facilitate the provision of financing to, or assist
(whether as owner, shareholder, member, partner, director, officer, trustee,
employee, agent or consultant, or in any other capacity), any business,
organization or person other than the Company (or any subsidiary or affiliate of
the Company) whose business, activities, products or services (collectively,
"BUSINESS ACTIVITIES") are competitive with either (i) any of the Business
Activities conducted or offered by the Company or its subsidiaries or affiliates
during any period in which Executive is employed by the Company or any of its
subsidiaries or affiliates, or has served as a director of the Company, which
Business Activities shall include in any event and without limitation providing
software products and marketing, training, management, billing, collection and
insurance brokerage services to entities in the business of purchasing or
financing accounts receivable or in the factoring business, or (ii) any other
Business Activities which the Company or its subsidiaries or affiliates conducts
or offers on, or is actively planning and actually conducts or offers within
twelve (12) months after the date Executive's employment with the Company
terminates. Notwithstanding the foregoing, (i) competitive Business Activities
shall not include Executive's activities in the equipment leasing business, such
as GE


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Capital, CIT, and Wells Fargo, and (ii) Executive may own, directly or
indirectly, solely as an investment, securities of any entity if Executive (a)
is not a controlling person with respect to such entity and (b) does not,
directly or indirectly, own five percent (5%) or more of any class of the
securities of such entity. Notwithstanding, the provisions contained in this
Section 9.1 shall not be binding on the Executive if, during the Restricted
Period, the Company materially breaches the terms of this Agreement, and such
material breach is not cured by the Company within ten (10) days following
receipt of a written notice from Executive which describes in detail the nature
of the material breach.

   9.2 Trade Secrets; Confidential Information. Executive covenants and agrees
that, at all times during and after the Restricted Period, he shall keep secret
and not disclose to others or appropriate to his own use or the use of others
any trade secrets, or secret or confidential information or knowledge pertaining
to the Company Business or the affairs of the Company or any of its affiliates
including without limitation trade know-how, trade secrets, consultant
contracts, customer lists, pricing policies, operational methods, marketing
plans or strategies, product development techniques or plans, business
acquisition plans, new personnel acquisition plans, technical processes, designs
and design projects, inventions and research projects; provided, however, that
the following shall not constitute a breach or violation of this Paragraph: any
disclosure made by the Executive in the course of his employment by the Company
as provided in this Agreement, or any disclosure reasonably believed by
Executive to be compelled by law or legal process. Information shall not be
deemed confidential or secret for purposes of this Agreement if it is generally
known in the industry.

   9.3 Employees of the Company. During the Restricted Period, Executive shall
not directly or indirectly hire away or solicit to hire away from the Company or
any of its affiliates any employee of the Company or its affiliates.

   9.4 Property of the Company. All memoranda, notes, lists, records and other
documents (and all copies thereof) made or compiled by Executive or made
available to Executive during his employment by the Company concerning the
business or affairs of the Company or any of its affiliates, other than any of
such which may pertain primarily personally to Executive, shall be the exclusive
property of the Company and shall be delivered to the Company promptly upon the
termination of Executive's employment with the Company or at any other time on
request by the Board of Directors of the Company or such affiliates.

   9.5 Rights and Remedies Upon Breach. If Executive breaches, or threatens to
commit a breach of, any of the provisions of Paragraphs 9.1 through 9.4 of this
Agreement (collectively, the "RESTRICTIVE COVENANTS"), the Company shall have
the following rights and remedies, each of which shall be independent of the
other and severally enforceable, and all of which shall be in addition to, and
not in lieu of, any other rights and remedies available to the Company: (a) the
right and remedy to have any of the Restrictive Covenants specifically enforced
by any court having jurisdiction and in Tennessee by an arbitration panel as
provided in Paragraph 12 of this Agreement, it being hereby acknowledged and
agreed by Executive that any such breach or threatened breach will cause
irreparable injury to the Company and that money damages will not provide an
adequate remedy to the Company; and (b) the right and remedy to require
Executive to


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account for and pay over to the Company all compensation, profits, monies,
accruals, increments or other benefits derived or received by Executive as a
result of any transactions constituting a breach of any of the Restrictive
Covenants, and Executive shall account for and pay over such benefits to the
Company.

   9.6 Severability of Covenants. If it is determined that any of the
Restrictive Covenants, or any part thereof, is invalid or unenforceable, the
remainder of the Restrictive Covenants shall not thereby be affected and shall
be given full effect, without regard to the invalid portions. If it is
determined that any of the Restrictive Covenants, or any part thereof, is
unenforceable because of the duration of such provision, the geographical area
covered thereby, or any other determination of unreasonableness of the
provision, the arbitration panel making such determination shall have the power
to reduce the duration, area or scope of such provision and, in its reduced
form, such provision shall then be enforceable and shall be enforced.

   9.7 Consulting. For a period of twenty-four (24) months following the
termination of Executive's employment with the Company under this Agreement,
whether Executive's employment terminates pursuant to the provisions of
Paragraph 6 of this Agreement or otherwise, including the Company's failure to
renew Executive's employment after the Initial Term (collectively, the
"CONSULTING PERIOD"), Executive covenants and agrees that he will consult with
the Company from time to time, as reasonably requested by the Company with
Executive's consent which will not be unreasonably withheld.

10. Notice. All notices, requests, demands and other communications given under
or by reason of this Agreement shall be in writing and shall be deemed given
when delivered in person or when mailed, by certified mail (return receipt
requested), postage prepaid, addressed as follows (or to such other address as a
party may specify by notice pursuant to this provision):

                  (a)   To the Company:

                        Private Business, Inc.
                        9010 Overlook Boulevard
                        Brentwood, Tennessee 37027
                        Attention: Chairman

                  (b)   To Executive:

                        Henry M. Baroco
                        810 Thornberry Drive
                        Alpharetta, GA 30022

11. Controlling Law and Performability. The execution, validity, interpretation
and performance of this Agreement shall be governed by the law of the State of
Tennessee.

12. Arbitration. Any dispute or controversy arising under or in connection with
this Agreement shall be settled by arbitration in Nashville, Tennessee. In the
proceeding the Executive shall select one (1) arbitrator, the Company shall
select one (1) arbitrator and the


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two (2) arbitrators so selected shall select a third (3rd) arbitrator. The
decision of a majority of the arbitrators shall be binding on the Executive and
the Company. Should one party fail to select an arbitrator within five (5) days
after notice of the appointment of the an arbitrator by the other party or
should the two (2) arbitrators selected by the Executive and the Company fail to
select an arbitrator within ten (10) days after the date of the appointment of
the last of such two (2) arbitrators, any person sitting as a Judge of the
United States District Court for the Middle District of Tennessee, Nashville
Division, upon application of the Executive or the Company, shall appoint an
arbitrator to fill such space with the same force and effect as though such
arbitrator had been appointed in accordance with the first sentence of this
Paragraph 12. Any arbitration proceeding pursuant to this Paragraph 12 shall be
conducted in accordance with the rules of the American Arbitration Association.
Judgment may be entered on the arbitrators' award in any court having
jurisdiction.

13. No Obligation to Mitigate. The Executive shall not be required to mitigate
the amount of any payment provided for in Paragraph 7 by seeking other
employment or otherwise, nor shall the amount of any payment provided for in
Paragraph 7 be reduced by any compensation earned by the Executive as a result
of employment by another employer or otherwise.

14. Additional Instruments. The Parties shall execute and deliver any and all
additional instruments and agreements that may be necessary or proper to carry
out the purposes of this Agreement.

15. Entire Agreement and Amendments. This Agreement contains the entire
agreement of the Parties relating to the matters contained herein and supersedes
all prior agreements and understandings, oral or written, between the Parties
with respect to the subject matter hereof. This Agreement may be changed only by
an agreement in writing signed by the Party against whom enforcement of any
waiver, change, modification, extension or discharge is sought.

16. Separability. If any provision of the Agreement is rendered or declared
illegal or unenforceable by reason of any existing or subsequently enacted
legislation or by the decision of any arbitrator or by decree of a court of last
resort, the Parties shall promptly meet and negotiate substitute provisions for
those rendered or declared illegal or unenforceable to preserve the original
intent of this Agreement to the extent legally possible, but all other
provisions of this Agreement shall remain in full force and effect.

17. Assignments. The Company may assign this Agreement and in the event of an
assignment of this Agreement, all covenants, conditions and provisions hereunder
shall inure to the benefit of and be enforceable against the Company's
successors and assigns. The rights and obligations of Executive under this
Agreement are personal to him, and no such rights, benefits or obligations shall
be subject to voluntary or involuntary alienation, assignment or transfer.

18. Effect of Agreement. Subject to the provisions of Paragraph 17 with respect
to assignments, this Agreement shall be binding upon the Executive and his
heirs, executors, administrators, legal representatives and assigns and upon the
Company and respective successors and assigns.


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19. Execution. This Agreement may be executed in multiple counterparts each of
which shall be deemed an original and all of which shall constitute one and the
same instrument.

20. Waiver of Breach. The waiver by either Party of a breach of any provision of
the Agreement by the other Party shall not operate or be construed as a waiver
by such Party of any subsequent breach by such other Party.

   IN WITNESS WHEREOF, the Parties have executed this Agreement effective as set
forth above.

                                    PRIVATE BUSINESS, INC.



                                    By: /s/ William B. King
                                        ----------------------------------------
                                        William B. King, Chairman


                                    EXECUTIVE



                                    /s/ Henry M. Baroco
                                    --------------------------------------------
                                    HENRY M. BAROCO


Source: OneCLE Business Contracts.