exv4w4



 





Exhibit 4.4




Registration Rights Agreement

Between

US Dataworks, Inc.

And

Hyundai Syscomm Corp.




December 29, 2006




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     Registration Rights Agreement (this “Agreement”) is entered into as of the 29th day
of December, 2006, by and between US Dataworks, Inc., a Nevada corporation (the “Company”), and
Hyundai Syscomm Corp., a California corporation (“HYUNDAI”).



R E C I T A L S




     WHEREAS, HYUNDAI and the Company have entered into a Stock Purchase Agreement (the “Stock
Purchase Agreement”), dated as of the date hereof, pursuant to which, among other things: (i)
HYUNDAI has agreed, on the terms and conditions set forth therein, to purchase Six Million One
Hundred Thousand (6,100,000) shares (the “Purchased Shares”) of the Company Common Stock (“Common
Stock”) for an aggregate purchase price (the “Purchase Price”) of One Million Five Hundred
Thousand Dollars ($1,500,000); and (ii) the Company has issued and delivered HYUNDAI a warrant
dated the date hereof (the “Warrant”) that will enable HYUNDAI to achieve and maintain up to
Thirty-Nine And Nine-Tenths Percent (39.9%) ownership interest in the outstanding Common Stock of
the Company provided that HYUNDAI provides a sufficient level of business to the Company under the
Stock Purchase Agreement; and



     WHEREAS, HYUNDAI, the Company and Hirshfield Law, as Escrow Agent (the “Escrow Agent”), have
entered into an Escrow Agreement (the “Escrow Agreement”), dated as of the date hereof, pursuant to
which, among other things, the Company has agreed to deliver the Purchased Shares and HYUNDAI has
agreed to wire transfer the Purchase Price to the Escrow Agent as soon as practicable; and



     WHEREAS, the Purchased Shares are, and shares of Common Stock issuable upon exercise of the
Warrant (the “Warrant Shares”), when and if issued, will be “restricted securities,” as such term
is defined in Rule 144 promulgated by the Securities and Exchange Commission (the “Commission”)
under the Securities Act and bear a restrictive legend (the “Legend”); and



     WHEREAS, is order to register the resale of the Purchased Shares and any Warrant Shares that
may be issued (collectively, the “Shares”) under the Securities Act, the Company is willing to
enter into this Agreement.



     NOW, THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, it is hereby agreed
as follows:



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1. Definitions. The following terms used herein have the following meanings:




     “Agreement” means this Agreement, as amended, restated, supplemented, or otherwise modified
from time to time.



     “Certificates” is defined in the 1st Recital to this Agreement.



     “Commission” means the Commission, as defined in the 4th Recital to this Agreement,
or any other federal agency then administering the Securities Act or the Exchange Act.



     “Common Stock” is defined in the 1st Recital of this Agreement.



     “Company” is defined in the preamble to this Agreement.



     “Company Indemnified Party” is defined in Section 4.2.



     “Demanding Holder” is defined in Section 2.1.1.



     “Demand Registration” is defined in Section 2.1.1.



     “Escrow Agent” is defined in the 2nd Recital to this Agreement.



     “Escrow Agreement” is defined in the 2nd Recital to this Agreement.



     “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder, all as the same shall be in effect at the
time.



     “HYUNDAI” is defined in the preamble to this Agreement.



     “Indemnified Party” is defined in Section 4.3.



     “Indemnifying Party” is defined in Section 4.3.



     “HYUNDAI Indemnified Party” is defined in Section 4.1.



     “Legend” is defined in the 4th Recital of this Agreement.



     “Maximum Number of Shares” is defined in Section 2.1.4.



     “Notices” is defined in Section 6.3.



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     “Piggy-Back Registration” is defined in Section 2.2.1.



     “Purchased Shares” is defined in the 1st Recital to this Agreement.



     “Purchase Price” is defined in the 1st Recital to this Agreement.



     “Register,” registered” and “registration” mean a registration effected by preparing and
filing a registration statement or similar document in compliance with the requirements of the
Securities Act, and the applicable rules and regulations promulgated thereunder, and such
registration statement becoming effective.



     “Registrable Shares” means the Shares. As to any particular Registrable Shares, such Shares
shall cease to be Registrable Shares when: (a) a Registration Statement with respect to the sale of
such Shares shall have become effective under the Securities Act and such securities shall have
been sold, transferred or disposed of in accordance with such Registration Statement; (b) such
Shares shall have been otherwise transferred, new certificates for them not bearing the Legend
shall have been delivered by the Company and subsequent public distribution of them shall not
require registration under the Securities Act; (c) such Shares shall have ceased to be outstanding.



     “Registration Statement” means a registration statement filed by the Company with the
Commission in compliance with the Securities Act for a public offering and sale of Common Stock
(other than a registration statement on Form S-4 or Form S-8, or their successors, or any
registration statement covering only securities proposed to be issued in exchange for securities or
assets of another entity).



     “Restricted Securities” is defined in the 4th Recital of this Agreement.



     “Securities Act” means Securities Act of 1933, as amended, and the rules and regulations of
the Commission promulgated thereunder, all as the same shall be in effect at the time.



     “Shares” is defined in the 4th Recital of this Agreement.



     “Stock Purchase Agreement” is defined in the 1st Recital to this Agreement.



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     “Underwriter” means a securities dealer who purchases any Registrable Shares as principal in
an underwritten offering and not as part of such dealer’s market-making activities.



     “Warrant” is defined in the 1st Recital to this Agreement.



     “Warrant Shares” is defined in the 3rd Recital to this Agreement.


2. Registration Rights.




     2.1 Demand Registration.



          2.1.1. Request for Registration. At any time after the date of this Agreement,
HYUNDAI may make a written demand for registration under the Securities Act of all or part of its
Registrable Shares (a “Demand Registration”). Any demand for a Demand Registration shall specify
the number of Registrable Shares proposed to be sold and the intended method(s) of distribution
thereof. Upon any such request, HYUNDAI shall be entitled to have its Registrable Shares included
in the Demand Registration, subject to Section 2.1.4 and the provisos set forth in Section 3.1.1.
The Company shall not be obligated to effect more than three (3) Demand Registrations under this
Section 2.1.1 in respect of Registrable Shares.




          2.1.2. Effective Registration. A registration will not count as the Demand
Registration until the Registration Statement filed with the Commission with respect to such Demand
Registration has been declared effective by the Commission and the Company has complied with all of
its obligations under this Agreement with respect thereto; provided, however, that if, within [6]
months after such Registration Statement has been declared effective and prior to the sale of all
the Shares registered on such Registration Statement, the offering of Registrable Shares pursuant
to a Demand Registration is interfered with by any stop order or injunction of the Commission or
any other governmental agency or court, the Registration Statement with respect to such Demand
Registration will be deemed not to have been declared effective, unless and until, (i) such stop
order or injunction is removed, rescinded or otherwise terminated, and (ii) HYUNDAI elects to
continue the offering.




          The Company will maintain the such Demand Registration or post-effective amendment filed under
this Section 2 hereof effective




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under the Securities Act until the earliest of (i) the date that all the Registrable Shares
pursuant to such Demand Registration have been disposed of pursuant to the Demand Registration,
(ii) the date all such Registrable Shares have been otherwise transferred to persons who may trade
such shares without restriction under the Securities Act, and the Company has delivered a new
certificate or other evidence of ownership for such Securities not bearing a restrictive legend, or
(iii) the date all such Registrable Shares may be sold without any time, volume or manner
limitations pursuant to Rule 144(k) or any similar provision then in effect under the Securities
Act (the “Effectiveness Period”)




          2.1.3. Underwritten Offering. If HYUNDAI so elects and so advises the Company as part
of its written demand for a Demand Registration, the offering of such Registrable Shares pursuant
to such Demand Registration shall be in the form of an underwritten offering. In such event, the
right of HYUNDAI to include its Registrable Shares in such registration shall be conditioned upon
HYUNDAI’s participation in such underwriting and the inclusion of HYUNDAI’s Registrable Shares in
the underwriting to the extent provided herein. HYUNDAI shall enter into an underwriting agreement
in customary form with the Underwriter or Underwriters selected for such underwriting by HYUNDAI.




          2.1.4. Reduction of Offering. If the managing Underwriter or Underwriters for a Demand
Registration that is to be an underwritten offering advises the Company and HYUNDAI in writing that
the dollar amount or number of Registrable Shares which HYUNDAI desires to sell, taken together
with all other shares of Common Stock or other securities which the Company desires to sell and the
shares of Common Stock, if any, as to which registration has been requested pursuant to written
contractual piggy-back registration rights held by other stockholders of the Company who desire to
sell, exceeds the maximum dollar amount or maximum number of shares that can be sold in such
offering without adversely affecting the proposed offering price, the timing, the distribution
method, or the probability of success of such offering (such maximum dollar amount or maximum
number of shares, as applicable, the “Maximum Number of Shares”), then the Company shall include in
such registration: (i) first, the Registrable Shares as to which Demand Registration has been
requested by HYUNDAI that can be sold without exceeding the Maximum Number of Shares; (ii) second,
to the extent that the Maximum Number of Shares has not been reached under the foregoing clause
(i), the shares of Common Stock or other securities that the Company desires to sell that can be
sold without exceeding the




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Maximum Number of Shares; (iii) third, to the extent that the Maximum Number of Shares has not
been reached under the foregoing clauses (i) and (ii), the shares of Common Stock for the account
of other persons that the Company is obligated to register pursuant to written contractual
arrangements with such persons and that can be sold without exceeding the Maximum Number of Shares;
and (iv) fourth, to the extent that the Maximum Number of Shares have not been reached under the
foregoing clauses (i), (ii), and (iii), the shares of Common Stock that other stockholders desire
to sell that can be sold without exceeding the Maximum Number of Shares.




          2.1.5. Withdrawal. If HYUNDAI disapproves of the terms of any underwriting or is not
entitled to include all of its Registrable Shares in any offering, HYUNDAI may elect to withdraw
from such offering by giving written notice to the Company and the Underwriter or Underwriters of
its request to withdraw prior to the effectiveness of the Registration Statement filed with the
Commission with respect to such Demand Registration. If HYUNDAI withdraws from a proposed offering
relating to a Demand Registration, then such registration shall not count as a Demand Registration
provided for in Section 2.1.1.




     2.2 Piggy-Back Registration.



          2.2.1. Piggy-Back Rights. If at any time on or after the date hereof the Company
proposes to file a Registration Statement under the Securities Act with respect to an offering of
equity securities, or securities or other obligations exercisable or exchangeable for, or
convertible into, equity securities, by the Company for its own account or for stockholders of the
Company for their account (or by the Company and by stockholders of the Company including, without
limitation, pursuant to Section 2.1), other than a Registration Statement (i) filed in connection
with any employee stock option or other benefit plan, (ii) for an exchange offer or offering of
securities solely to the Company’s existing stockholders or (iii) filed on Form S-4, then the
Company shall (x) give written notice of such proposed filing to HYUNDAI as soon as practicable but
in no event less than ten (10) calendar days before the anticipated filing date, which notice shall
describe the amount and type of securities to be included in such offering, the intended method(s)
of distribution, and the name of the proposed managing Underwriter or Underwriters, if any, of the
offering, and (y) offer to HYUNDAI in such notice the opportunity to register the sale of such
number of Registrable Shares as HYUNDAI may request in writing within five (5) days following
receipt of such notice (a “Piggy-Back




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Registration”). The Company shall cause such Registrable Shares to be included in such
registration and shall use its reasonable best efforts to cause the managing Underwriter or
Underwriters of a proposed underwritten offering to permit the Registrable Shares requested to be
included in a Piggy-Back Registration to be included on the same terms and conditions as any
similar securities of the Company and to permit the sale or other disposition of such Registrable
Shares in accordance with the intended method(s) of distribution thereof. HYUNDAI shall enter into
an underwriting agreement in customary form with the Underwriter or Underwriters, if any, selected
for such Piggy-Back Registration. The Company shall not be obligated to effect more than five (5)
Piggy-Back Registrations under this Section 2.2.1 in respect of Registrable Shares.




          2.2.2. Reduction of Offering. If the managing Underwriter or Underwriters for a
Piggy-Back Registration that is to be an underwritten offering advises the Company and HYUNDAI in
writing that the dollar amount or number of shares of Common Stock which the Company desires to
sell, taken together with shares of Common Stock, if any, as to which registration has been
demanded pursuant to written contractual arrangements with persons other than HYUNDAI, and the
shares of Common Stock, if any, as to which registration has been requested pursuant to the written
contractual piggy-back registration rights of other stockholders of the Company, exceeds the
Maximum Number of Shares, then the Company shall include in any such registration: (i) if the
registration is undertaken for the Company’s account: (A) first, the shares of Common Stock or
other securities that the Company desires to sell that can be sold without exceeding the Maximum
Number of Shares; (B) second, to the extent that the Maximum Number of Shares has not been reached
under the foregoing clause (A), the shares of Common Stock, if any, including the Registrable
Shares, as to which registration has been requested pursuant to written contractual piggy-back
registration rights of security holders (pro rata in accordance with the number of shares of Common
Stock which each such person has actually requested to be included in such registration, regardless
of the number of shares of Common Stock with respect to which such persons have the right to
request such inclusion) that can be sold without exceeding the Maximum Number of Shares; and (ii)
if the registration is a “demand” registration undertaken at the demand of persons other than
HYUNDAI pursuant to written contractual arrangements with such persons, (A) first, the shares of
Common Stock for the account of the demanding persons that can be sold without exceeding the
Maximum Number of Shares; (B) second, to the extent that the Maximum Number of Shares




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has not been reached under the foregoing clause (A), the shares of Common Stock or other
securities that the Company desires to sell that can be sold without exceeding the Maximum Number
of Shares; and (C) third, to the extent that the Maximum Number of Shares has not been reached
under the foregoing clauses (A) and (B), the Registrable Shares as to which registration has been
requested under this Section 2.2; and (D) fourth, to the extent that the Maximum Number of Shares
has not been reached under the foregoing clauses (A), (B) and (C), the shares of Common Stock, if
any, as to which registration has been requested pursuant to written contractual piggy-back
registration rights which other stockholders desire to sell that can be sold without exceeding the
Maximum Number of Shares.




          2.2.3. Withdrawal. HYUNDAI may elect to withdraw its request for inclusion of
Registrable Shares in any Piggy-Back Registration by giving written notice to the Company of such
request to withdraw prior to the effectiveness of the Registration Statement. The Company may also
elect to withdraw a registration statement at any time prior to the effectiveness of the
Registration Statement. Notwithstanding any such withdrawal, the Company shall pay all expenses
incurred by HYUNDAI in connection with such Piggy-Back Registration as provided in Section 3.3.



3. Registration Procedures.




     3.1 Filings; Information. Whenever the Company is required to effect the registration
of any Registrable Shares pursuant to Section 2, the Company shall use its reasonable best efforts
to effect the registration and sale of such Registrable Shares in accordance with the intended
method(s) of distribution thereof as expeditiously as practicable, and in connection with any such
request:



          3.1.1. Filing Registration Statement. The Company shall, as expeditiously as possible
and in any event within ninety (90) days after receipt of a request for a Demand Registration
pursuant to Section 2.1, prepare and file with the Commission a Registration Statement on any form
for which the Company then qualifies or which counsel for the Company shall deem appropriate and
which form shall be available for the sale of all Registrable Shares to be registered thereunder in
accordance with the intended method(s) of distribution thereof, and shall use its reasonable best
efforts to cause such Registration Statement to become and remain effective for the period required
by Section 3.1.3; provided, however, that the Company shall




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have the right to defer any Demand Registration for up to ninety (90) days, and any
Piggy-Back Registration for such period as may be applicable to deferment of any demand
registration to which such Piggy-Back Registration relates, in each case if the Company shall
furnish to the holders a certificate signed by the Chief Executive Officer of the Company stating
that, in the good faith judgment of the Board of Directors of the Company, it would be materially
detrimental to the Company and its stockholders for such Registration Statement to be effected at
such time; provided further, however, that the Company shall not have the right to exercise the
right set forth in the immediately preceding proviso more than once in any 365-day period in
respect of a Demand Registration hereunder.




          3.1.2. Copies. The Company shall, prior to filing a Registration Statement or
prospectus, or any amendment or supplement thereto, which includes any Registrable Shares, furnish
without charge to HYUNDAI and HYUNDAI’s legal counsel, copies of such Registration Statement as
proposed to be filed, each amendment and supplement to such Registration Statement (in each case
including all exhibits thereto and documents incorporated by reference therein), the prospectus
included in such Registration Statement (including each preliminary prospectus), and such other
documents as HYUNDAI or its legal counsel may request in order to facilitate the disposition of
HYUNDAI’s Registrable Shares.




          3.1.3. Amendments and Supplements. The Company shall prepare and file with the
Commission such amendments, including post-effective amendments, and supplements to such
Registration Statement and the prospectus used in connection therewith as may be necessary to keep
such Registration Statement effective and in compliance with the provisions of the Securities Act
until all Registrable Shares and other securities covered by such Registration Statement have been
disposed of in accordance with the intended method(s) of distribution set forth in such
Registration Statement (which period shall not exceed the sum of one hundred eighty (180) days plus
any period during which any such disposition is interfered with by any stop order or injunction of
the Commission or any governmental agency or court) or such securities have been withdrawn.




          3.1.4. Notification. After the filing of a Registration Statement, if any Registrable
Shares are included in such Registration Statement of such filing, the Company shall promptly, and
in no event more than two (2) business days after such filing,




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notify HYUNDAI and shall further notify HYUNDAI promptly and confirm such advice in writing in
all events within two (2) business days of the occurrence of any of the following: (i) when such
Registration Statement becomes effective; (ii) when any post-effective amendment to such
Registration Statement becomes effective; (iii) the issuance or threatened issuance by the
Commission of any stop order (and the Company shall take all actions required to prevent the entry
of such stop order or to remove it if entered); and (iv) any request by the Commission for any
amendment or supplement to such Registration Statement or any prospectus relating thereto or for
additional information or of the occurrence of an event requiring the preparation of a supplement
or amendment to such prospectus so that, as thereafter delivered to the purchasers of the
securities covered by such Registration Statement, such prospectus will not contain an 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 not misleading, and promptly make available to HYUNDAI any
such supplement or amendment; except that before filing with the Commission a Registration
Statement or prospectus or any amendment or supplement thereto, including documents incorporated by
reference, the Company shall furnish to HYUNDAI and to its legal counsel copies of all such
documents proposed to be filed sufficiently in advance of filing to provide HYUNDAI and its legal
counsel with a reasonable opportunity to review such documents and comment thereon.




          3.1.5. State Securities Laws Compliance. The Company shall use its reasonable best
efforts to (i) register or qualify the Registrable Shares covered by the Registration Statement
under such securities or “blue sky” laws of such jurisdictions in the United States as HYUNDAI (in
light of its intended plan of distribution) may request and (ii) take such action necessary to
cause such Registrable Shares covered by the Registration Statement to be registered with or
approved by such other governmental authorities as may be necessary by virtue of the business and
operations of the Company and do any and all other acts and things that may be necessary or
advisable to enable HYUNDAI to consummate the disposition of its Registrable Shares in such
jurisdictions; provided, however, that the Company shall not be required to qualify generally to do
business in any jurisdiction where it would not otherwise be required to qualify but for this
paragraph or subject itself to taxation in any such jurisdiction.




          3.1.6. Agreements for Disposition. The Company shall enter into customary agreements
(including, if applicable, an




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underwriting agreement in customary form) and take such other actions as are reasonably
required in order to expedite or facilitate the disposition of the Registrable Shares. The
representations, warranties and covenants of the Company in any underwriting agreement which are
made to or for the benefit of any Underwriters, to the extent applicable, shall also be made to and
for the benefit of HYUNDAI. HYUNDAI shall not be required to make any representations or
warranties in the underwriting agreement except, if applicable, with respect to HYUNDAI’s title to
the Registrable Shares and with respect to written information relating to HYUNDAI that HYUNDAI has
furnished in writing expressly for inclusion in such Registration Statement.




          3.1.7. Cooperation. The principal executive officer of the Company, the principal
financial officer of the Company, the principal accounting officer of the Company and all other
officers and members of the management of the Company shall cooperate fully in any offering of
Registrable Shares hereunder, which cooperation shall include, without limitation, the preparation
of the Registration Statement with respect to such offering and all other offering materials and
related documents, and participation in meetings with Underwriters, attorneys, accountants and
potential investors.




          3.1.8. Records. The Company shall make available for inspection by HYUNDAI, any
Underwriter participating in any disposition pursuant to such registration statement and any
attorney, accountant or other professional retained by HYUNDAI or any Underwriter, all financial
and other records, pertinent corporate documents and properties of the Company, as shall be
reasonably necessary to enable them to exercise their due diligence responsibility, and cause the
Company’s officers, directors and employees to supply all information requested by any of them in
connection with such Registration Statement; provided, however, that each such person retained by
HYUNDAI shall agree to hold in strict confidence and shall not make any disclosures (except to
HYUNDAI) or use any such record or other information which the Company determines in good faith to
be confidential, and of which determination such persons are so notified.




          3.1.9. Opinions and Comfort Letters. The Company shall furnish to HYUNDAI a signed
counterpart, addressed to HYUNDAI, of (i) any opinion of counsel to the Company delivered to any
Underwriter and (ii) any comfort letter from the Company’s independent public accountants delivered
to any Underwriter. In the




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event no legal opinion is delivered to any Underwriter, the Company shall furnish to HYUNDAI,
at any time that HYUNDAI elects to use a prospectus, an opinion of counsel to the Company to the
effect that the Registration Statement containing such prospectus has been declared effective and
that no stop order is in effect.




          3.1.10. Earnings Statement. The Company shall comply with all applicable rules and
regulations of the Commission and the Securities Act, and make available to its stockholders, as
soon as practicable, an earnings statement covering a period of twelve (12) months, beginning
within three (3) months after the effective date of the Registration Statement, which earnings
statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder.




          3.1.11. Listing. The Company shall use its reasonable best efforts to cause all
Registrable Shares included in any registration to be listed on the American Stock Exchange or
otherwise designated for trading in the same manner as similar securities issued by the Company are
then listed or designated or, if no such similar securities are then listed or designated, in a
manner reasonably satisfactory to HYUNDAI.




     3.2 Obligation to Suspend Distribution. Upon receipt of any notice from the Company of
the happening of any event of the kind described in Section 3.1.4(iv), HYUNDAI shall immediately
discontinue disposition of such Registrable Shares pursuant to the Registration Statement covering
such Registrable Shares until HYUNDAI receives the supplemented or amended prospectus contemplated
by Section 3.1.4(iv) and, if so directed by the Company, HYUNDAI will deliver to the Company all
copies, other than permanent file copies then in HYUNDAI’s possession, of the most recent
prospectus covering such Registrable Shares at the time of receipt of such notice.



     3.3 Registration Expenses. The Company shall bear all costs and expenses incurred in
connection with each Demand Registration pursuant to Section 2.1 and any Piggy-Back Registration
pursuant to Section 2.2, and all expenses incurred in performing or complying with its other
obligations under this Agreement, whether or not the Registration Statement becomes effective,
including, without limitation: (i) all registration and filing fees; (ii) fees and expenses of
compliance with securities or “blue sky” laws (including fees and disbursements of counsel in
connection with blue sky qualifications of the Registrable Shares); (iii) printing expenses;



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(iv) the Company’s internal expenses (including, without limitation, all salaries and expenses
of its officers and employees); (v) the fees and expenses incurred in connection with the listing
of the Registrable Shares as required by Section 3.1.11; (vi) National Association of Securities
Dealers, Inc. fees; (vii) fees and disbursements of counsel for the Company and fees and expenses
for independent certified public accountants retained by the Company (including the expenses or
costs associated with the delivery of any opinions or comfort letters requested pursuant to Section
3.1.9); (viii) the fees and expenses of any special experts retained by the Company in connection
with such registration and (ix) the fees and expenses of one legal counsel selected by HYUNDAI.
The Company shall have no obligation to pay any underwriting discounts or selling commissions
attributable to the Registrable Shares being sold by HYUNDAI, which underwriting discounts or
selling commissions shall be borne by HYUNDAI. Additionally, in an underwritten offering, all
selling stockholders and the Company shall bear the expenses of the underwriter pro rata in
proportion to the respective amount of shares each is selling in such offering.




     3.4 Information. HYUNDAI shall provide such information as may reasonably be requested
by the Company, or the managing Underwriter, if any, in connection with the preparation of any
Registration Statement, including amendments and supplements thereto, in order to effect the
registration of any Registrable Shares under the Securities Act pursuant to Section 2 and in
connection with the Company’s obligation to comply with federal and applicable state securities
laws.


4. Indemnification and Contribution.




     4.1 Indemnification by the Company. The Company agrees to indemnify and hold harmless
HYUNDAI and its successors and assigns, and each person, if any, who controls any successor or
assign of HYUNDAI (within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) (each, a “HYUNDAI Indemnified Party”), from and against any expenses, losses,
judgments, claims, damages or liabilities, whether joint or several, arising out of or based upon
any untrue statement (or allegedly untrue statement) of a material fact contained in any
Registration Statement under which the sale of any Registrable Shares was registered under the
Securities Act, any preliminary prospectus, final prospectus or summary prospectus contained in the
Registration Statement, or any amendment or supplement to such Registration Statement, or arising
out of or based upon any omission (or alleged omission) to state a



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material fact required to be stated therein or necessary to make the statements therein not
misleading, or any violation by the Company of the Securities Act or any rule or regulation
promulgated thereunder applicable to the Company and relating to action or inaction required of the
Company in connection with any such registration; and the Company shall promptly reimburse the
HYUNDAI Indemnified Party for any legal and any other expenses reasonably incurred by such HYUNDAI
Indemnified Party in connection with investigating and defending any such expense, loss, judgment,
claim, damage, liability or action; provided, however, that the Company will not be liable in any
such case to the extent that any such expense, loss, claim, damage or liability arises out of or is
based upon any untrue statement or allegedly untrue statement or omission or alleged omission made
in such Registration Statement, preliminary prospectus, final prospectus, or summary prospectus, or
any such amendment or supplement, in reliance upon and in conformity with information furnished to
the Company, in writing, by such Indemnified Party expressly for use therein. The Company also
shall indemnify any Underwriter of the Registrable Shares, their officers, affiliates, directors,
partners, members and agents and each person who controls such Underwriter on substantially the
same basis as that of the indemnification provided above in this Section 4.1.




     4.2 Indemnification by HYUNDAI. HYUNDAI will, in the event that any registration is
being effected under the Securities Act pursuant to this Agreement of any Registrable Shares held
by HYUNDAI, indemnify and hold harmless the Company, each of its directors and officers and each
underwriter (if any), and each other person, if any, who controls such selling holder or such
underwriter within the meaning of the Securities Act (each, a “Company Indemnified Party”), against
any expenses, losses, claims, judgments, damages or liabilities, whether joint or several, insofar
as such expenses, losses, claims, judgments, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or allegedly untrue statement of a material
fact contained in any Registration Statement under which the sale of such Registrable Shares was
registered under the Securities Act, any preliminary prospectus, final prospectus or summary
prospectus contained in the Registration Statement, or any amendment or supplement to the
Registration Statement, or arise out of or are based upon any omission or the alleged omission to
state a material fact required to be stated therein or necessary to make the statement therein not
misleading, if the statement or omission was made in reliance upon and in conformity with
information furnished in writing to the Company by HYUNDAI expressly for use therein, and



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shall reimburse the Company, its directors and officers, and each such controlling person for
any legal or other expenses reasonably incurred by any of them in connection with investigation or
defending any such loss, claim, damage, liability or action. HYUNDAI’s indemnification obligations
hereunder shall be limited to the amount of any net proceeds actually received by HYUNDAI.




     4.3 Conduct of Indemnification Proceedings. Promptly after receipt by any person of
any notice of any loss, claim, damage or liability or any action in respect of which indemnity may
be sought pursuant to Section 4.1 or 4.2, such person (the “Indemnified Party”) shall, if a claim
in respect thereof is to be made against any other person for indemnification hereunder, notify
such other person (the “Indemnifying Party”) in writing of the loss, claim, judgment, damage,
liability or action; provided, however, that the failure by the Indemnified Party to notify the
Indemnifying Party shall not relieve the Indemnifying Party from any liability which the
Indemnifying Party may have to such Indemnified Party hereunder, except and solely to the extent
the Indemnifying Party is actually prejudiced by such failure. If the Indemnified Party is seeking
indemnification with respect to any claim or action brought against the Indemnified Party, then the
Indemnifying Party shall be entitled to participate in such claim or action, and, to the extent
that it wishes, jointly with all other Indemnifying Parties, to assume control of the defense
thereof with counsel satisfactory to the Indemnified Party. After notice from the Indemnifying
Party to the Indemnified Party of its election to assume control of the defense of such claim or
action, the Indemnifying Party shall not be liable to the Indemnified Party for any legal or other
expenses subsequently incurred by the Indemnified Party in connection with the defense thereof
other than reasonable costs of investigation; provided, however, that in any action in which both
the Indemnified Party and the Indemnifying Party are named as defendants, the Indemnified Party
shall have the right to employ separate counsel (but no more than one such separate counsel) to
represent the Indemnified Party and its controlling persons who may be subject to liability arising
out of any claim in respect of which indemnity may be sought by the Indemnified Party against the
Indemnifying Party, with the fees and expenses of such counsel to be paid by such Indemnifying
Party if, based upon the written opinion of counsel of such Indemnified Party, representation of
both parties by the same counsel would be inappropriate due to actual or potential differing
interests between them. No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, consent to entry of judgment or effect any settlement of any claim or pending or



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threatened proceeding in respect of which the Indemnified Party is or could have been a party
and indemnity could have been sought hereunder by such Indemnified Party, unless such judgment or
settlement includes an unconditional release of such Indemnified Party from all liability arising
out of such claim or proceeding.




     4.4 Contribution.



          4.4.1. If the indemnification provided for in the foregoing Sections 4.1, 4.2 and 4.3 is
unavailable to any Indemnified Party in respect of any loss, claim, damage, liability or action
referred to herein, then each such 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
loss, claim, damage, liability or action in such proportion as is appropriate to reflect the
relative fault of the Indemnified Parties and the Indemnifying Parties in connection with the
actions or omissions which resulted in such loss, claim, damage, liability or action, as well as
any other relevant equitable considerations. The relative fault of any Indemnified Party and any
Indemnifying Party shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission to state a material
fact relates to information supplied by such Indemnified Party or such Indemnifying Party and the
parties’ relative intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.




          4.4.2. The parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 4.4 were determined by pro rata allocation or by any other method of
allocation which does not take account of the equitable considerations referred to in the
immediately preceding Section 4.4.1. The amount paid or payable by an Indemnified Party as a result
of any loss, claim, damage, liability or action referred to in the immediately preceding paragraph
shall be deemed to include, subject to the limitations set forth above, any legal or other expenses
incurred by such Indemnified Party in connection with investigating or defending any such action or
claim. Notwithstanding the provisions of this Section 4.4, HYUNDAI shall not be required to
contribute any amount in excess of the dollar amount of the net proceeds (after payment of any
underwriting fees, discounts, commissions or taxes) actually received by HYUNDAI from the sale of
Registrable Shares which gave rise to such contribution obligation. No person guilty of fraudulent
misrepresentation (within the meaning




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of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation.



5. Rule 144. The Company covenants that it shall file any reports required to be filed by
it under the Securities Act and the Exchange Act and shall take such further action as HYUNDAI may
reasonably request, all to the extent required from time to time to enable HYUNDAI to sell
Registrable Shares without registration under the Securities Act within the limitation of the
exemptions provided by Rule 144 under the Securities Act, as such Rule may be amended from time to
time, or any similar Rule or regulation hereafter adopted by the Commission.



6. Miscellaneous.




     6.1. Other Registration Rights. The Company represents and warrants that no person,
other HYUNDAI has any right to require the Company to register any shares of the Company’s capital
stock for sale or to include shares of the Company’s capital stock in any registration filed by the
Company for the sale of shares of capital stock for its own account or for the account of any other
person.



     6.2 Assignment; No Third Party Beneficiaries. This Agreement and the rights, duties
and obligations of the Company hereunder may not be assigned or delegated by the Company in whole
or in part. This Agreement and the rights, duties and obligations of HYUNDAI may be freely
assigned or delegated by HYUNDAI in conjunction with and to the extent of any transfer of
Registrable Shares HYUNDAI. This Agreement and the provisions hereof shall be binding upon and
shall inure to the benefit of each of the parties and their respective successors and the permitted
assigns of holder of Registrable Shares or of any assignee of HYUNDAI. This Agreement is not
intended to confer any rights or benefits on any persons that are not party hereto other than
HYUNDAI and except as expressly set forth in Section 4 and this Section 6.2.



     6.3. Notices. All notices, demands, requests, consents, approvals or other
communications (collectively, “Notices”) required or permitted to be given hereunder or which are
given with respect to this Agreement shall be in writing and shall be personally served, delivered
by reputable air courier service with charges prepaid, or transmitted by hand delivery, telegram,
telex, facsimile or E-mail, addressed as set forth below, or to such other address as such party
shall have specified most recently by written notice.



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Notice shall be deemed given on the date of service or transmission if personally served or
transmitted by telegram, telex, facsimile or E-Mail; provided, that if such service or transmission
is not on a business day or is after normal business hours, then such notice shall be deemed given
on the next business day. Notice otherwise sent as provided herein shall be deemed given on the
next business day following timely delivery of such notice to a reputable air courier service with
an order for next-day delivery.




	 	 	 	 	 
	If to the Company:	 	With a copy to:
	US Dataworks, Inc.

	 	 	 	Pillsbury Winthrop Shaw Pittman LLP
	5301 Hollister Road, Second Floor

	 	 	 	2475 Hanover Street
	Houston, Texas 77040

	 	 	 	Palo Alto, California 94304-1114
	Attention: John J. Figone, Sr.

	 	 	 	Attention: Richard Bebb, Esq.
	Vice President & General Counsel

	 	 	 	Telephone: (650) 233-4500
	Telephone: (713) 934-3855 x250

	 	 	 	Facsimile:
	Facsimile: (713) 690-1426

	 	 	 	Email: rbebb@pillsburylaw.com
	Email:jfigone@usdataworks.com
	 	 	 	 
	 
	 	 	 	 
	If to HYUNDAI:	 	With a copy to:
	Hyundai Syscomm Corp.

	 	 	 	Peter B. Hirshfield, Esq.
	1065 East Hillsdale Boulevard

	 	 	 	Hirshfield Law
	Suite 247

	 	 	 	1035 Park Avenue, Suite 7B
	Foster City, CA 94404

	 	 	 	New York NY 10028-0912
	Attention: Samuel Lee

	 	 	 	Telephone: (646) 827-9362
	Chairman of the Board

	 	 	 	Facsimile: (646) 349-1665
	Telephone: (510) 790-4500

	 	 	 	Email: phirshfield@hirshfieldlaw.com
	Facsimile: (415) 358-4551
	 	 	 	 
	Email: jack@hyundaisyscom.com
	 	 	 	 






     6.4. Severability. This Agreement shall be deemed severable, and the invalidity
or unenforceability of any term or provision hereof shall not affect the validity or enforceability
of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such
invalid or unenforceable term or provision, the parties hereto intend that there shall be added as
a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision
as may be possible that is valid and enforceable.



     6.5. Counterparts. This Agreement may be executed in multiple counterparts, each of
which shall be deemed an original, and all of which taken together shall constitute one and the
same instrument.



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     6.6. Electronic Counterparts Acceptable. An electronically transmitted copy of a
manually signed counterpart of this Agreement or any Notice shall for all purposes be equivalent to
the manually signed counterpart so electronically transmitted.



     6.7. Entire Agreement. This Agreement (including all agreements entered into pursuant
hereto and all certificates and instruments delivered pursuant hereto and thereto) constitute the
entire agreement of the parties with respect to the subject matter hereof and supersede all prior
and contemporaneous agreements, representations, understandings, negotiations and discussions
between the parties, whether oral or written.



     6.8. Modifications and Amendments. No amendment, modification or termination of this
Agreement shall be binding upon any party unless executed in writing by such party.



     6.9. Titles and Headings. Titles and headings of sections of this Agreement are for
convenience only and shall not affect the construction of any provision of this Agreement.



     6.10. Waivers and Extensions. Any party to this Agreement may waive any right, breach
or default which such party has the right to waive, provided that such waiver will not be effective
against the waiving party unless it is in writing, is signed by such party, and specifically refers
to this Agreement. Waivers may be made in advance or after the right waived has arisen or the
breach or default waived has occurred. Any waiver may be conditional. No waiver of any breach of
any agreement or provision herein contained shall be deemed a waiver of any preceding or succeeding
breach thereof nor of any other agreement or provision herein contained. No waiver or extension of
time for performance of any obligations or acts shall be deemed a waiver or extension of the time
for performance of any other obligations or acts.



     6.11 Remedies Cumulative. In the event that the Company fails to observe or perform
any covenant or agreement to be observed or performed under this Agreement, the Investor or any
other holder of Registrable Shares may proceed to protect and enforce its rights by suit in equity
or action at law, whether for specific performance of any term contained in this Agreement or for
an injunction against the breach of any such term or in aid of the exercise of any power granted in
this Agreement or to enforce any other legal or equitable right, or to take any one or more of such
actions, without being required to post a bond. None of the rights, powers or remedies



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conferred under this Agreement shall be mutually exclusive, and each such right, power or
remedy shall be cumulative and in addition to any other right, power or remedy, whether conferred
by this Agreement or now or hereafter available at law, in equity, by statute or otherwise.




     6.12 Governing Law. This Agreement shall be governed by, interpreted under, and
construed in accordance with the internal laws of the State of California applicable to agreements
made and to be performed within the State of California, without giving effect to any choice-of-law
provisions thereof that would compel the application of the substantive laws of any other
jurisdiction.



     6.13 Waiver of Trial by Jury. Each party hereby irrevocably and unconditionally waives
the right to a trial by jury in any action, suit, counterclaim or other proceeding (whether based
on contract, tort or otherwise) arising out of, connected with or relating to this Agreement, the
transactions contemplated hereby, or the actions of the Investor in the negotiation,
administration, performance or enforcement hereof.



     6.14 Termination of Registration Rights. The Company’s obligations pursuant to this
Agreement (other than those in Section 4) shall terminate as to Registrable Shares on the earlier
of (i) when HYUNDAI can sell all of its Registrable Shares pursuant to Rule 144(k) under the
Securities Act without any time, volume or manner limitations or (ii) when HYUNDAI has sold all
Registrable Shares pursuant to Sections 2 and 3.



     IN WITNESS WHEREOF, the parties have caused this Registration Rights Agreement to be executed
and delivered by their duly authorized representatives as of the date first written above.



	 	 	 	 	 	 	 	 	 	 	 
	US Dataworks, Inc.	 	 	 	Hyundai Syscomm Corp.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Charles E. Ramey	 	 	 	By:	 	/s/ Samuel Lee	 	 
	 

	 	 

Charles E. Ramey
	 	 
	 	 	 	 

Name: Samuel Lee
	 	 
	 

	 	Chief Executive Officer
	 	 	 	 	 	Title: Chairman of the Board	 	 






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