exv10w1



 





EXHIBIT 10.1




US DATAWORKS, INC.

ADDITIONAL COMPENSATION AGREEMENT




     This ADDITIONAL COMPENSATION AGREEMENT (this “Agreement”) is made and
effective as of April 12, 2004, by and between US Dataworks, Inc., a Nevada
corporation (the “Company”) and John S. Reiland (“Reiland”).



     WHEREAS, the Company, to advance the interest of the Company by motivating
key executives to remain in the employ of the Company and to increase the value
of the Company, hereby agrees to pay certain additional compensation to
Reiland, subject to the terms and conditions set forth herein.



     1.  Additional
Compensation.



     (a) The Company hereby agrees to pay additional compensation to Reiland in
the amount of $430,000, payable, at the Company’s option, either in cash or,
subject to shareholder approval, in freely tradeable shares of the Company’s
common stock, (the “Additional Compensation”), in addition to Reiland’s salary,
bonuses and other compensation otherwise payable by the Company to Reiland.
Subject to Section 1(b) below, the Additional Compensation shall be paid in two
(2) equal installments of $215,000 each on March 17, 2006 and March 17, 2007.



     (b) Notwithstanding Section 1(a), if the average closing share price of
the Company’s common stock for the twenty (20) trading days prior to March 17,
2006, as reported on the American Stock Exchange (or the principal stock market
on which the Company’s common stock is then listed for trading) (the “Average
Closing Price”) is less than $2.70 per share, then Reiland’s Additional
Compensation shall be equal to the Average Closing Price less $0.55 multiplied
by 200,000.



     2.  Termination. If Reiland’s employment with the Company is terminated by
the Company for Cause (as defined below) or if Reiland voluntarily terminates
his employment with the Company, Reiland will be entitled to such Additional
Compensation, if any, as has accrued under this Agreement through the effective
date of termination, but will not be entitled to any other Additional
Compensation. As used in this Agreement, the term “Cause” means 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 Reiland; (ii) gross malfeasance or gross neglect by Reiland
in the conduct of Reiland’s duties; or (iv) willful violation by Reiland of any
applicable federal or state securities laws or regulations.



     3.  Change
In Control.



     (a) If the Company is subject to a Change in Control (as defined in the
Plan) prior to March 17, 2007, or if Reiland resigns within ten (10) days
following a material diminution in his title or compensation within six (6)
months following a Change in Control then the Company will pay Reiland in one
lump sum all Additional Compensation, if any, as has accrued under this
Agreement through the effective date of termination and any other Additional
Compensation not yet accrued.



 









 





     (b) If the Company is subject to a Change in Control (as defined in the
Plan) prior to March 17, 2007, Reiland shall be entitled to a cash bonus equal
to the excess of the fair market value of the shares for which Additional
Compensation was not granted as of the date of the Change of Control, over the
fair market value of such shares as of September 26, 2003. Any payments due
hereunder shall be paid within sixty (60) days of the date of the Change in
Control.



     4.  Withholding
Payroll Taxes. To the extent required by the laws in effect
at the time payments are made, the Company shall withhold from payments made
hereunder any taxes required to be withheld for federal, state or local
governmental purposes.



     5.  No
Employment Rights. Nothing in this Agreement nor any award of
Additional Compensation shall interfere with or limit in any way the right of
the Company to terminate Reiland’s employment at any time for any reason or no
reason, nor confer upon Reiland any right to continue in the employ of the
Company.



     6.  Nature
Of Rights. This Agreement is solely an arrangement to pay
Additional Compensation. All benefits due under this Agreement are unfunded
and unsecured and are payable out of the general assets of the Company.
Reiland’s right to receive payments under this Agreement shall be no greater
than the right of an unsecured general creditor of the Company in the event of
its insolvency.



     7.  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, Reiland 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.



     8.  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.



     9.  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
Reiland shall be sent to 5301 Hollister Road, Suite 250, Houston, Texas 77040,
Attn: John S. Reiland. Notices to the Company shall be sent to 5301 Hollister
Road, Suite 250, Houston, Texas 77040, Attn: Board of Directors. A mailed
first-class notice shall be deemed given two (2) business days after deposit
with U.S. Postal Service.



     10.  Assignment. This Agreement may not be assigned or encumbered in any
way by Reiland. The Company may assign this Agreement to any successor (whether
by 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).



 









 





     11.  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.



     12.  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.



     13.  Arbitration. If a dispute or claim shall arise with respect to any of
the terms or provisions of this Agreement, or with respect to the performance
by either of the parties under this Agreement, then either party may, by notice
as herein provided, require that the dispute be submitted under the Commercial
Arbitration Rules of the American Arbitration Association to an arbitrator in
good standing with the American Arbitration Association within fifteen (15)
days after such notice is given. The written decision of the single arbitrator
ultimately appointed by or for both parties shall be binding and conclusive on
the parties, including with respect to any award of attorneys’ fees or costs.
Judgment may be entered on such written decision by the single arbitrator in
any court having jurisdiction and the parties consent to the jurisdiction of
the courts of the State of Texas for this purpose. Any arbitration undertaken
pursuant to the terms of this Section shall occur in the State of Texas.



     14.  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.



[Remainder of page intentionally left blank. Signature page follows.]




 









 








     IN WITNESS WHEREOF, this Agreement is executed as date first set forth
above.

	 	 	 	 	 
	 	 
US DATAWORKS, INC.

 
 	 
	 	By:  	/s/
Charles E. Ramey 	 
	 	 	Charles E. Ramey 	 
	 	 	Chief Executive Officer 	 
	 
	 	 	 
	 	By:  	
/s/ John S. Reiland 	 
	 	 	John S. Reiland