EXHIBIT 10.1
EMPLOYMENT AGREEMENT
     THIS EMPLOYMENT AGREEMENT (this “Agreement”) dated and effective as of
April 3, 2006 (the “Effective Date”) is by and between US DATAWORKS, INC., a
Nevada corporation (the “Company”), and John J. Figone (“Figone”). In
consideration of the mutual covenants and promises contained herein, the parties
agree as follows.
     WHEREAS, the Company deems it essential that it have the advantage of the
services of Figone and desires to enter into a continuing agreement of
employment with him, and to provide Figone with compensation, including stock
options.
ARTICLE 1 GENERAL PROVISIONS
     Section 1.1 Employment. The Company hereby employs Figone, and Figone
accepts such employment by the Company upon the terms and conditions hereof.
     Section 1.2 Term. Subject to earlier termination as specifically set forth
herein, the initial term of this Agreement shall be commencing on the Effective
Date and continuing until April 3, 2008 (the “Term”). The Term shall be extended
automatically without further action by either party for successive one (1) year
terms (each extension expiring on the anniversary of April 3), unless either
party shall have served not less than ninety (90) days prior written notice upon
the other party that this Agreement shall terminate.
     Section 1.3 Termination. Figone’s employment and this Agreement shall
terminate upon the earliest to occur of any of the following events (the actual
date of such termination being referred to herein as the “Termination Date”):
     (a) Pursuant to Section 1.2.
     (b) In the event of Figone’s death or disability as set forth in
Section 3.6.
     (c) Termination of Figone’s employment by the Company for cause without any
prior notice (except as specifically set forth below), upon the occurrence of
any of the following events (each of which shall constitute “Cause”):
          (i) any embezzlement or wrongful diversion of funds of the Company or
any affiliate of the Company by Figone;
          (ii) gross malfeasance by Figone in the conduct of Figone’s duties;
          (iii) breach of this Agreement or any of the Company’s written
policies and, if such breach is capable of being cured, as determined by the
Board of Directors of the Company (the “Board of Directors”), failure of Figone
to cure such breach after notice and reasonable opportunity to cure such breach;
          (iv) gross neglect by Figone in carrying out Figone’s duties; or

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          (v) willful violation by Figone of any applicable federal or state
securities laws or regulations.
     (d) Termination of Figone’s employment by the Company at any time without
Cause.
     (e) Termination by Figone of his employment at any time.
     Section 1.4 Termination Obligations: Return of Company Property. Upon
termination of this Agreement, Figone shall promptly return all Company
property.
ARTICLE 2
POSITION AND DUTIES; OTHER BUSINESS ACTIVITIES
     Section 2.1 Position. Figone shall be employed as Senior Vice President,
Business Development and General Counsel. Figone shall also serve as Secretary
of the Company. Figone shall report directly to the Chief Executive Officer of
the Company.
     Section 2.2 Duties: Full Attention to Business. The primary focus of
Figone’s employment is to aggrandize Top-line Revenues of the Company through
acquisitions and mergers (“Inorganic Revenue Growth”) and by establishing
strategic partnerships. Figone shall be directly responsible for the supervision
and management of the Company’s Business Development, establishing and
maintaining Strategic Alliances and Relationships, and the Company’s General
Counsel. Figone shall perform such services for the Company that reasonably
serve the purpose of this Agreement and/or meet the needs of the Company, and
that are consistent with the position Figone holds. Figone shall devote his full
business time, energies, interest, abilities, and productive efforts to the
business of the Company. Except as may be approved by the Company’s Board of
Directors, Figone shall not render any kind of employee-type or consulting
services to others for compensation and, in addition, shall not engage in any
activity which conflicts or interferes with his performance of duties hereunder.
Notwithstanding the provisions of this Section 2.2, Figone may, with the prior
written consent of the Board of Directors, engage in civic, charitable, or
educational activities, provided that such service and activities do not,
individually or in the aggregate, interfere with the performance of Figone’s
duties under the Agreement.
     Section 2.3 Covenant Not To Compete During Term. During the Term, Figone
shall comply in all respects with the Company’s written policies with respect to
conflicts of interest. Except as may be approved by the Company’s Board of
Directors, Figone shall not engage in or be interested, directly or indirectly,
in any business or operation competitive with the Company. For the purpose of
this paragraph, Figone shall be deemed to be interested in a business or
operation which is competitive with the Company if Figone is a holder of five
percent (5%) or more of the issued and outstanding ownership interests in such
business or operation, or serves as a director, officer, employee, agent,
partner, individual proprietor, lender, consultant, or independent contractor of
such business or operation.
     Section 2.4 Non-Disclosure of Confidential Information. Figone acknowledges
that in connection with his employment by the Company or its affiliates, he has
and may acquire or

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learn “Confidential Information” of the Company by virtue of a relationship of
trust and confidence between Figone and the Company. Figone warrants and agrees
that during the Term he shall not disclose to anyone (other than to officers of
the Company or to such other persons as such officers may designate), or use,
except in the course of his employment with the Company or its affiliates, any
Confidential Information acquired by him in the course of or in connection with
his employment. As used herein, the term “Confidential Information” shall
include, but not be limited to: all information of any type or kind, whether or
not reduced to a writing and whether or not conceived, originated, discovered or
developed in whole or in part by Figone, which is directly related to the
Company, its operations, policies, agreements with third parties, its financial
affairs and related matters, including business plans, strategic planning
information, product information, purchase and sales information and terms,
supplier negotiation points, styles and strategies, contents and terms of
contracts between the Company and suppliers, advertisers, vendors, contact
persons, terms of supplier and/or vendor contracts or particular transactions,
potential supplies and/or vendors, or other related data; marketing information
such as but not limited to, prior, ongoing or proposed marketing programs,
presentations, or agreements by or on behalf of the Company, pricing
information, customer bonus programs, marketing tests and/or results of
marketing efforts, computer files, lists and reports, manuals and memos
pertaining to the business of the Company, lists or compilations of vendor
and/or supplier names, addresses, phone numbers, requirements and descriptions,
contract information sheets, compensation requirements or terms, benefits,
policies, and any other financial information whether about the Company,
entities related or affiliated with the Company or other key information
pertaining to the business of the Company, including but not limited to all
information which is not generally available to or known in the information
services industry (or is available only as a result of an unauthorized
disclosure) and is treated by the Company as “Confidential Information” during
the term of this Agreement, regardless of whether or not such Information is a
“trade secret” as otherwise defined by applicable law unless such information is
in the public domain.
     Section 2.5 No Solicitation of Company’s Employees. Figone specifically
agrees that during the Term and for a period of one (1) year after his
termination of employment with the Company, Figone shall not, directly or
indirectly, either for himself or for any other person, firm, corporation, or
legal entity, solicit any individual, then employed by the Company to leave the
employment of the Company, without first securing permission from the Company to
do so.
     Section 2.6 Ownership of Work Product and Ideas. Any discoveries,
inventions, patents, materials, licenses and ideas applicable to the industry or
relating to Figone’s services for the Company or its affiliates, whether or not
patentable or copyrightable, created by Figone during his employment by the
Company or its affiliates (“Work Product”) and all business opportunities within
the industry (“Opportunities”) introduced to Figone by the Company or its
affiliates will be owned by the Company, and Figone will have no personal
interest in such, except to the extent that the Company allows Figone to invest
or participate in or have other rights to such Work Product or Opportunities.
Figone will, in such connection, promptly disclose any such Work Product and
Opportunities to the Company and, upon request of the Company, will assign to
the Company all right in such Work Product and Opportunities.

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ARTICLE 3
COMPENSATION; BENEFITS
     Section 3.1 Salary. The Company shall pay Figone Seven Thousand Two Hundred
Ninety-one Dollars and Sixty-seven cents ($7,291.67) on a semi-monthly basis,
for an annualized base salary (“Base Salary”) of One Hundred Seventy-five
Thousand Dollars ($175,000). Beginning with the first anniversary of the
Effective Date and for each subsequent year of employment (or any portion of any
such year), Figone shall be entitled to a Base Salary review by the Company to
determine if any increase to Base Salary is warranted as a result of
performance.
     Section 3.2 Inorganic Revenue Growth Bonus.
     (a) The primary focus of Figone’s employment is to increase the Top-line
Revenues of the Company through acquisitions and mergers and by establishing
strategic partnerships. As an incentive to achieving this end, Figone shall
receive a cash bonus, paid quarterly, for any acquisitions or mergers involving
the Company (“Inorganic Revenue Growth Bonus”). The amount of the Inorganic
Revenue Growth Bonus shall be calculated by multiplying the Asset Value of the
entity/assets being acquired or merged with the corresponding Inorganic Revenue
Growth percentage, as set forth in Schedule 1, attached hereto. For purposes of
this Agreement, the “Asset Value” shall be the reported value for the asset(s)
being acquired or merged determined in accordance with generally accepted
accounting principles (GAAP) and as reported in the Company’s (or the surviving
acquirer’s) Securities Exchange Commission (“SEC”) public filing. For example,
if all of the assets of the Company are acquired by a third party entity, the
Asset Value shall be the value such third party reports as having paid for the
Company’s assets, not the asset value of the acquiring third party entity.
Conversely, if the Company acquires an entity, the Asset Value shall be the
value the Company paid for that entity. In the event a merger or acquisition is
effected without a SEC filing, the Asset Value shall be the purchase price as
memorialized in the corresponding acquisition or merger documentation between
the parties. The Inorganic Revenue Growth Bonus shall be paid to Figone within
thirty (30) days of the Company’s fiscal quarter’s end in which the acquisition
or merger is consummated.
     (b) At the end of any fiscal quarter in which an Inorganic Revenue Growth
Bonus is to be paid to Figone, should the Company determine, in good faith, that
the Company’s cash position is such that it will not have sufficient cash to
fund its business operations for the next three successive fiscal quarters,
then, in lieu of an all cash Inorganic Revenue Growth Bonus, the Company shall
give Figone written notice of its determination and Figone will, at his option,
receive an Inorganic Revenue Growth Bonus payable as follows: (i) cash in any
portion up to but not exceeding fifty percent (50%) of the Inorganic Revenue
Growth Bonus amount, and (ii) the remaining balance of the Inorganic Revenue
Growth Bonus shall be payable in shares of restricted common stock equal to one
hundred ten percent (110%) of the non-cash balance of the Inorganic Revenue
Growth Bonus
     Section 3.3 Paid Vacation. Figone shall be entitled to be paid vacation
time under the Company’s policies applicable to other senior executives of the
Company’s policies, but in no event shall Figone be eligible for less than four
(4) weeks of paid time off per calendar year.

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     Section 3.4 Stock Options.
     (a) Subject to approval of the Compensation Committee of the Board of
Directors, which such grant shall be made as promptly hereafter as practicable,
the Company will grant to Figone an option to purchase Seven Hundred Thousand
(700,000) shares of common stock of the Company under the Plan, which shall be
intended to qualify as an incentive stock option to the maximum extent permitted
under Section 422 of the Internal Revenue Code of 1986, as amended. The option
shall be subject to the terms and conditions of the Plan and an option agreement
to be entered into between the Company and Figone, in a form approved by the
Compensation Committee of the Board of Directors which option agreement shall
provide that such option shall have a ten (10) year term (subject to earlier
termination in connection with termination of employment). All such options will
have the exercise price per share equal to the fair market value of the
Company’s common stock as of the date of grant.
     (b) The option shall vest and become exercisable, subject to continued
employment as follows:
          (i) three hundred thousand (300,000) shares of common stock shall vest
on April 3, 2006;
          (ii) two hundred thousand (200,000) shares of common stock shall vest
on April 3, 2007;
          (iii) two hundred thousand (200,000) shares of common stock shall vest
on April 3, 2008; and,
          (iv) in each case to become fully vested and exercisable upon a Change
in Control as defined in the Plan (a “Change in Control”).
     (c) Figone shall be eligible to receive additional grants of options
pursuant to the Plan in the sole discretion of the Compensation Committee of the
Board of Directors.
     Section 3.5 Other Benefits. During the Term, Figone shall be entitled to
participate in present and future employee benefit plans which are available to
the Company’s employees, subject to eligibility requirements thereunder.
     Section 3.6 Disability or Death. If the Board of Directors determines, on
the basis of professional medical advice, that Figone has become unable to
substantially perform his duties under this Agreement due to illness or mental
or physical disability with reasonable accommodation, and that such failure or
inability has continued or is reasonably expected to continue for any
consecutive six-month period, the Company shall have the option to terminate
this Agreement by giving written notice to Figone thereof and the basis therefor
at least thirty (30) days prior to the effective date of termination. This
Agreement shall also terminate immediately upon Figone’s death. If Figone’s
employment with the Company is terminated pursuant to this Section 3.6, the
Company shall pay Figone the salary, bonuses, and commissions which are earned
but unpaid as of the date of termination.

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     Section 3.7 Severance.
     (a) If the Company terminates Figone’s employment other than for Cause
pursuant to Section 1.3(d), other than by reason of death or Disability pursuant
to Section 3.6, or if Figone resigns within ten (10) days following a material
reduction in his duties (as per Section 2.2) or material reduction of
compensation within six (6) months following a Change in Control then subject to
Figone’s continuing obligations under Section 2.4 and Section 2.5 and in
consideration of the execution, delivery and effectiveness of a general release
of claims in a standard form approved by the Company, the Company shall pay to
Figone a lump sum of two (2) times Figone’s current Base Salary in cash within
fifteen (15) days after the date of termination (or, if later, upon the
effectiveness of the general release following any applicable revocation
period), any Inorganic Revenue Growth Bonus for acquisitions or mergers
consummated within one hundred 180 days after the date of termination and shall
vest one hundred percent (100%) of Figone’s then remaining unvested portion of
the options granted in accordance with this Agreement, in addition to other
amounts payable from qualified plans, nonqualified retirement plans, and
deferred compensation plans, which amounts shall be paid in accordance with the
terms of such plans.
     (b) If the Company terminates Figone’s employment for Cause, or if Figone
resigns, then Figone shall only be entitled to be paid his accrued, unpaid Base
Salary through the effective date of his termination of employment, any
Inorganic Revenue Growth Bonus for acquisitions or mergers consummated prior to
the fiscal quarter’s end in which the date of termination occurs and his
entitlement to other amounts payable from qualified plans, nonqualified
retirement plans, and deferred compensation plans shall be determined in
accordance with the terms of such plans.
     (c) No severance benefits shall be provided pursuant to this Section 3.7 if
Figone’s employment is terminated by reason of expiration or non-renewal of this
Agreement in accordance with Section 1.2. with the exception of any earned
Revenue Growth Bonus or any unpaid FY2006 bonus.
     Section 3.8 Excess Parachute Payments.
     (a) If there is a “Change in Control” of the Company within the meaning of
Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), a
portion of the benefits to which Figone is entitled under this Agreement could
be characterized as “excess parachute payments” within the meaning of
Section 280G of the Code. The parties hereto acknowledge that the protections
set forth in this Section 3.8 are important, and it is agreed that Figone should
not have to bear the full burden of the excise tax that might be levied under
Section 4999 of the Code or any similar provision of federal, state of local
law, in the event that any portion of the benefits payable to Figone pursuant to
this Agreement or the other incentive plans of the Company are treated as an
excess parachute payment. The parties, therefore, have agreed as set forth in
this Section 3.8.
     (b) Anything in this Agreement to the contrary notwithstanding, if it shall
be determined that any payment or distribution (including income recognized by
Figone upon the early vesting of restricted property or upon the exercise of
options whose exercise date has been

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accelerated) by the Company or any other Person to or for the benefit of Figone
(whether paid or payable or distributed or distributable pursuant to the terms
of this Agreement or otherwise, but determined without regard to any additional
payments required under this Section 3.8, (a “Payment”) would be subject to the
excise tax imposed by Section 4999 of the Code or any similar provision of any
federal, state or local law or any interest or penalties are incurred by Figone
with respect to such excise tax (such excise tax, together with any such
interest and penalties, are hereinafter collectively referred to as the “Excise
Tax”), then the Company shall pay an additional payment, not to exceed the
amount of Figone’s then current Base Salary in the aggregate (a “Gross-Up
Payment”), in an amount such that after payment by Figone of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed on the Gross-Up Payment,
Figone retains an amount of the Gross-Up Payment equal to fifty percent (50%) of
the Excise Tax imposed on the Payments. Figone will bear the cost of the
remaining fifty percent (50%) until the aggregate Gross-Up Payments from the
Company have reached the amount of Figone’s then current Base Salary, and will
thereafter bear all additional taxes, interest or penalties.
     (c) In the event of any dispute as to the applicability or amount of any
Gross-Up Payment, all determinations required to be made under this Section 3.8,
including whether and when a Gross-Up Payment is required and the amount of such
Gross-Up Payment and the assumptions to be utilized in arriving at such
determination, shall be made by the independent public accounting firm regularly
employed by the Company (the “Accounting Firm”) which shall provide detailed
supporting calculations both to the Company and to Figone within fifteen
(15) business days after the receipt of notice from Figone that there has been a
Payment, or such earlier time as is requested by the Company. All fees and
expenses of the Accounting Firm will be borne by the Company. If the Accounting
Firm determines that no Excise Tax is payable by Figone, it shall furnish Figone
with a written statement that failure to report the Excise Tax on Figone’s
applicable federal income tax return would not result in the imposition of a
negligence or similar penalty. Any determination by the Accounting Firm shall be
binding on the Company and Figone unless and until a final determination is
received from the Internal Revenue Service indicating a contrary result. As a
result of uncertainty in the application of Section 4999 of the Code at the time
of the initial determination by the Accounting Firm hereunder, it is possible
that Gross-Up Payments may not have been made by the Company that should have
been made (“Underpayment”), consistent with the calculations required to be made
hereunder. If Figone thereafter is required to make a payment of any Excise Tax,
the Accounting Firm shall determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly paid by the Company to or
for the benefit of Figone, consistent with the maximum limitation stated in this
Section 3.8. In the event it is determined by the Accounting Firm that the Gross
Payments previously made by the Company exceeded the limitations stated in this
Section 3.8, upon written notice from the Company, accompanied by a copy of the
Accounting Firm’s calculation of same, the amount of such overpayment shall be
promptly paid by Figone to the Company.

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ARTICLE 4
MISCELLANEOUS PROVISIONS
     Section 4.1 Entire Agreement. This Agreement contains the entire Agreement
between the Parties and supersedes all prior oral and written Agreements,
understandings, commitments, or practices between the Parties with respect to
the subject matter hereof. Other than as expressly set forth herein, Figone and
the Company acknowledge and represent that there are no other promises, terms,
conditions or representations (verbal or written) regarding any matter relevant
hereto. No supplement, modification, or amendment of any term, provision or
condition of this Agreement shall be binding or enforceable unless evidenced in
writing and executed by the parties. The provisions of Sections 2.4, 2.5 and 2.6
shall survive termination of this Agreement.
     Section 4.2 Applicable Law. This Agreement shall be governed exclusively by
and construed in accordance with the laws of the State of Texas, notwithstanding
choice of law provisions thereof; and the venue of any litigation commenced
hereunder shall be Houston, Texas.
     Section 4.3 Injunctive Relief. Figone acknowledges that his services are of
a special, unique, unusual, extraordinary and intellectual character, which
gives them a peculiar value, the loss of which cannot be reasonably or
adequately compensated in damages in an action at law. If he should breach this
Agreement, in addition to its rights and remedies under general law, the Company
shall be entitled to seek equitable relief by way of injunction or otherwise.
     Section 4.4 Partial Invalidity. If the application of any provision of this
Agreement, or any section, subsection, subdivision, sentence, clause, phrase,
word or portion of this Agreement should be held invalid or unenforceable, the
remaining provisions thereof shall not be affected thereby, but shall continue
to be given full force and effect as if the invalid or unenforceable provision
had not been included herein.
     Section 4.5 Notices. Notices given under this Agreement shall be given by
registered or certified mail, postage prepaid, return receipt requested, or by
personal delivery to the respective addresses of the parties. Notices to Figone
shall be sent to 5301 Hollister Road, Suite 250, Houston, Texas 77040, Attn:
John J. Figone. Notices to the Company shall be sent to 5301 Hollister Road,
Suite 250, Houston, Texas 77040, Attn: Chief Executive Officer. A mailed
first-class notice shall be deemed given two (2) business days after deposit
with U.S. Postal Service.
     Section 4.6 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same instrument.
     Section 4.7 Assignment. This Agreement may not be assigned or encumbered in
any way by Figone. The Company may assign this Agreement to any successor
(whether by

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merger, consolidation, or purchase of the Company’s stock) to all or a
controlling interest in the Company’s business, in which case this Agreement
shall be binding upon and inure to the benefit of such successor(s) and
assign(s).
     Section 4.8 Limitation on Waiver. A waiver of any term, provision, or
condition of this Agreement shall not be deemed to be, or constitute a waiver of
any other term, provision or condition herein, whether or not similar. No waiver
shall be binding unless in writing and signed by the waiving party.
     Section 4.9 Attorney’s Fees. In the event that any proceeding is commenced
involving the interpretation or enforcement of the provisions of this Agreement,
the Party prevailing in such proceeding shall be entitled to recover its
reasonable costs and attorneys’ fees.
     Section 4.10 Taxes. All payments made pursuant to the provisions of this
Agreement shall be subject to the withholding of applicable taxes.
     Section 4.11 Not for the Benefit of Creditors or Third Parties. The
provisions of this Agreement are intended only for the regulation of relations
among the parties. This Agreement is not intended for the benefit of creditors
of the parties or other third parties and no rights are granted to creditors of
the parties or other third parties under this Agreement.
     IN WITNESS WHEREOF, this Agreement is executed as of the Effective Date.

                  US DATAWORKS, INC.    
 
           
 
  By   /s/ Charles E. Ramey
 
   
 
  Name        Charles E. Ramey    
 
  Title:   Chairman & Chief Executive Officer    
 
                /s/ John J. Figone                   John J. Figone    

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SCHEDULE 1

                                                                      Inorganic
Revenue   Blended Inorganic                                     Revenue Growth  
                  [enter Asset Value]   Growth Bonus   Bonus Percentage    
Asset Value   $ 6,000,000     $ 115,000       1.92 %
 
                                       
 
  From
  To
  Inorganic Growth
Bonus Percentage                
 
  $ -     $ 5,000,000       2.00 %                
 
  $ 5,000,001     $ 10,000,000       1.50 %                
 
  $ 10,000,001     $ 25,000,000       1.00 %                
 
  $ 25,000,001     and over     0.75 %