<PAGE>
                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington D.C., 20549

                                   ----------

                                   FORM 10-QSB
                                (Amendment No. 1)

                                   ----------

(Mark One)
[X]      QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934 For the quarterly period ended June 30, 2001

[  ]     TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF
         THE SECURITIES EXCHANGE ACT OF 1934
         For the transition period                    to

                        Commission file number: 001-15835

                               US DATAWORKS, INC.
                           (formerly SonicPort, Inc.)
        (Exact name of small business issuer as specified in its charter)

             NEVADA                                     84-1290152
(State or other jurisdiction of          (I.R.S. employer identification number)
 incorporation or organization)

        5301 HOLLISTER ROAD, SUITE 250
                HOUSTON, TEXAS                            77040
   (Address of principal executive offices)             (Zip Code)

                    Issuer's telephone number: (713) 934-3855

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
YES [X] NO [ ]

Number of shares of Common Stock outstanding as of June 30, 2001: 44,733,379.

Transitional Small Business Disclosure Format (Check one): YES [ ] NO [X]



<PAGE>

                                EXPLANATORY NOTE

         US Dataworks, Inc. (the "Company"), by this Form 10-QSB/A, Amendment
No. 1 to Form 10-QSB, hereby amends and restates Part I, Items 1 and 2, and Part
II, Item 6.



<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                                                SONICPORT, INC. AND SUBSIDIARIES
                                                      CONSOLIDATED BALANCE SHEET
                                                       June 30, 2001 (unaudited)
--------------------------------------------------------------------------------

                                     ASSETS
                                   (restated)
CURRENT ASSETS
   Cash and cash equivalents .................................       $   249,098
   Accounts receivable .......................................            50,000
   Due from related parties ..................................           158,698
   Deferred financing costs ..................................           176,118
   Prepaid media, net allowance of $975,000 ..................                --
   Prepaid expenses and other current assets .... ............            97,805
                                                                     -----------
         Total current assets ................................           731,719

PROPERTY AND EQUIPMENT, net ..................................         2,242,579
GOODWILL, net ................................................        15,900,332
OTHER ASSETS .................................................            11,957
                                                                     -----------
              TOTAL ASSETS ...................................       $18,886,587
                                                                     ===========

   The accompanying notes are an integral part of these financial statements.

                                       1


<PAGE>
<TABLE>

                                                           SONICPORT, INC. AND SUBSIDIARIES
                                                                 CONSOLIDATED BALANCE SHEET
                                                                  June 30, 2001 (unaudited)
-------------------------------------------------------------------------------------------
<CAPTION>
<S>                                                                           <C>
                            LIABILITIES AND SHAREHOLDERS' EQUITY
                                         (restated)
CURRENT LIABILITIES
   Notes payable ..........................................................   $     25,363
   Current portion of notes payable - related parties .....................        838,896
   Current portion of capital lease obligations ...........................         11,125
   Convertible promissory notes, net amortization discount of $263,437 ....      2,021,563
   Convertible promissory notes - related parties .........................        250,000
   Accounts payable .......................................................        207,669
   Accrued expenses .......................................................         78,800
   Interest payable, including $8,356 related parties .....................         29,376
   Due to related party ...................................................         66,197
   Net liabilities of discontinued operations .............................         23,777
                                                                              -------------
         Total current liabilities ........................................      3,552,766

NOTES PAYABLE - RELATED PARTIES, NET OF CURRENT PORTION ...................        635,245
CAPITAL LEASE OBLIGATIONS, NET OF CURRENT PORTION .........................         22,205
                                                                              -------------
         Total liabilities ................................................      4,210,216

COMMITMENTS

SHAREHOLDERS' EQUITY
   Convertible Series A preferred stock, $0.0001 par value
     10,000,000 shares authorized 640,000 shares issued and outstanding
     $2.50 liquidation preference, dividends of $24,000 in arrears ........             64
   Convertible Series B preferred stock, $0.0001 par value
     700,000 shares authorized
     629,666 shares issued and outstanding
     $0.75 liquidation preference, dividends of $15,742 in arrears ........             63
   Common stock, $0.0001 par value
     100,000,000 shares authorized
     44,733,379 shares issued and outstanding .............................          4,473
   Additional paid-in capital .............................................     36,791,700
   Accumulated deficit ....................................................    (21,899,929)
   Treasury stock, at cost, 1,528,000 shares ..............................       (220,000)
                                                                              -------------
         Total shareholders' equity .......................................     14,676,371
                                                                              -------------
              TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY ..................   $ 18,886,587
                                                                              =============

         The accompanying notes are an integral part of these financial statements.

                                             2
</TABLE>



<PAGE>
<TABLE>

                                                                                    SONICPORT, INC. AND SUBSIDIARIES
                                                                               CONSOLIDATED STATEMENTS OF OPERATIONS
                                                       For the Three Months Ended June 30, 2001 and 2000 (unaudited)
--------------------------------------------------------------------------------------------------------------------
<CAPTION>

                                                                                             2001           2000
                                                                                         ------------   ------------
                                                                                          (restated)     (restated)
<S>                                                                                      <C>            <C>
REVENUES
   Software licensing revenues .......................................................   $   273,777    $        --
   Application service provider revenues - affiliates sales ..........................       235,177             --
                                                                                         ------------   ------------
     Total revenues ..................................................................       508,954             --
                                                                                         ------------   ------------
OPERATING EXPENSES
   General and administrative ........................................................     1,107,870      1,584,005
   Depreciation and amortization .....................................................       722,516         39,184
   Consulting - related parties ......................................................        41,000             --
                                                                                         ------------   ------------
      Total operating expenses .......................................................     1,871,386      1,623,189
                                                                                         ------------   ------------
Loss from operations .................................................................    (1,362,432)    (1,623,189)
                                                                                         ------------   ------------
OTHER INCOME (EXPENSE)
   Financing costs ...................................................................       (18,301)            --
   Interest expense ..................................................................    (1,958,865)        (8,880)
   Interest expense - related parties ................................................        (8,356)            --
   Interest income ...................................................................         3,563          6,793
                                                                                         ------------   ------------
      Total other income (expense) ...................................................    (1,981,959)        (2,087)
                                                                                         ------------   ------------
LOSS FROM CONTINUING OPERATIONS BEFORE PROVISION FOR INCOME TAXES,
   DISCONTINUED OPERATIONS, AND EXTRAORDINARY ITEM ...................................    (3,344,391)    (1,625,276)
PROVISION FOR INCOME TAXES ...........................................................           400             --
                                                                                         ------------   ------------
LOSS FROM CONTINUING OPERATIONS BEFORE DISCONTINUED OPERATIONS AND
   EXTRAORDINARY ITEM ................................................................    (3,344,791)    (1,625,276)
                                                                                         ------------   ------------
DISCONTINUED OPERATIONS
   Income (loss) from operations of discontinued subsidiary, net of provision for
     income taxes of $0 ..............................................................        63,055     (1,003,942)
      Income (loss) on disposal of subsidiary, including provision of $0 for
        operating losses during the phase-out period, net of provision for income
        taxes of $0 ..................................................................            --             --
                                                                                         ------------   ------------
      Net Income (loss) from discontinued operations .................................        63,055     (1,003,942)
                                                                                         ------------   ------------

                     The accompanying notes are an integral part of these financial statements.

                                                         3
</TABLE>



<PAGE>
<TABLE>

                                                          SONICPORT, INC. AND SUBSIDIARIES
                                                     CONSOLIDATED STATEMENTS OF OPERATIONS
                             For the Three Months Ended June 30, 2001 and 2000 (unaudited)
------------------------------------------------------------------------------------------
<CAPTION>

                                                                  2001             2000
                                                             -------------   -------------
                                                               (restated)      (restated)
<S>                                                          <C>             <C>
LOSS BEFORE EXTRAORDINARY ITEM ...........................   $ (3,281,736)   $ (2,629,218)

EXTRAORDINARY LOSS
  Income from forgiveness of interest payable ............             --          41,667
                                                             -------------   -------------
NET LOSS .................................................   $ (3,281,736)   $ (2,587,551)
                                                             =============   =============
BASIC AND DILUTED LOSS PER SHARE
  From continuing operation ..............................   $      (0.08)   $      (0.04)
  From discontinued operations ...........................             --           (0.02)
  From extraordinary item ................................             --              --
                                                             -------------   -------------
      TOTAL BASIC AND DILUTED LOSS PER SHARE .............   $      (0.08)   $      (0.06)
                                                             =============   =============
BASIC AND DILUTED WEIGHTED-AVERAGE SHARES OUTSTANDING ....     40,747,791      41,239,580
                                                             =============   =============

        The accompanying notes are an integral part of these financial statements.

                                            4
</TABLE>



<PAGE>
<TABLE>

                                                                           SONICPORT, INC. AND SUBSIDIARIES
                                                                       CONSOLIDATED STATEMENTS OF CASH FLOW
                                              For the Three Months Ended June 30, 2001 and 2000 (unaudited)
-----------------------------------------------------------------------------------------------------------

                                                                                    2001          2000
                                                                                ------------   ------------
                                                                                 (restated)     (restated)
<S>                                                                             <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Net loss from continuing operations ......................................   $(3,344,791)   $(1,737,697)
   Adjustments to reconcile net loss to net cash used in operating activities
     Depreciation ...........................................................       132,662          9,028
     Amortization ...........................................................       589,854         30,156
     Interest charges on convertible promissory notes .......................        77,813             --
     Issuance of common stock for services rendered .........................        32,000             --
     Issuance of common stock for lock-up agreement .........................         6,781             --
     Issuance of warrants for lock-up agreements ............................        11,520             --
     Issuance of options for services rendered ..............................            --         15,750
     Interest from fixed conversion features ................................     1,771,826             --
   (Increase) decrease in
     Accounts receivable ....................................................       129,583             --
     Prepaid services .......................................................       (15,123)            --
     Prepaid expenses and other current assets ..............................            --             --
     Other assets ...........................................................            --        (32,541)
   Increase (decrease) in
     Accounts payable .......................................................      (138,210)            --
     Accrued expenses .......................................................       (35,389)            --
     Accrued Interest .......................................................            --             --
     Interest payable - related parties .....................................         5,328             --
     Interest payable .......................................................         6,347        (36,291)
                                                                                ------------   ------------
Net cash used in continuing operations activities ...........................      (769,799)    (1,751,595)
Net cash used in discontinued operations activities .........................      (166,281)    (1,042,848)
                                                                                ------------   ------------
Net cash used in operating activities .......................................      (936,080)    (2,794,443)
                                                                                ------------   ------------
CASH FLOWS FROM INVESTING ACTIVITIES
   Purchase of property and equipment .......................................       (12,393)       (20,021)
   Repayments to related parties ............................................      (160,944)            --
                                                                                ------------   ------------
Net cash used in investing activities .......................................      (173,337)       (20,021)
                                                                                ------------   ------------

                 The accompanying notes are an integral part of these financial statements.

                                                     5
</TABLE>



<PAGE>
<TABLE>

                                                                  SONICPORT, INC. AND SUBSIDIARIES
                                                              CONSOLIDATED STATEMENTS OF CASH FLOW
                                     For the Three Months Ended June 30, 2001 and 2000 (unaudited)
--------------------------------------------------------------------------------------------------

                                                                           2001          2000
                                                                       ------------   ------------
                                                                        (restated)     (restated)
<S>                                                                    <C>            <C>
CASH FLOWS FROM FINANCING ACTIVITIES
   Repayment of notes payable ......................................   $   (83,391)   $  (355,000)
   Repayment of notes payable - related parties ....................      (110,859)            --
   Proceeds from convertible promissory notes ......................       750,000             --
   Payments on convertible promissory notes ........................      (150,000)            --
   Payments on capital lease obligations ...........................        (1,623)            --
   Proceeds from issuance of preferred stock, net ..................            --      2,000,000
   Redemption of preferred stock ...................................            --       (400,000)
   Rescission of preferred stock ...................................       (10,000)            --
   Proceeds from issuance of common stock ..........................       104,654        666,850
   Stock issuance costs ............................................       (34,798)       (49,535)
   Payment of dividends ............................................      (264,698)            --
                                                                       ------------   ------------
Net cash provided by financing activities ..........................       199,285      1,862,315
                                                                       ------------   ------------
Net decrease in cash and cash equivalents ..........................      (910,132)      (952,149)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD .....................     1,159,230      1,208,585
                                                                       ------------   ------------
CASH AND CASH EQUIVALENTS, END OF PERIOD ...........................   $   249,098    $   256,436
                                                                       ============   ============
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
   INTEREST PAID ...................................................   $    57,188    $     3,504
                                                                       ============   ============
</TABLE>

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES

     During the three months ended June 30, 2001 certain founding shareholders
of Sonicport, Inc. exchanged 1,528,000 shares of common stock for $220,000 in
notes payable.

     During the three months ended June 30, 2000, note holders converted
$500,000 of convertible promissory notes and related finance charges totaling
$60,000 into 224,000 shares of common stock.

   The accompanying notes are an integral part of these financial statements.

                                       6


<PAGE>

                                                SONICPORT, INC. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       June 30, 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 1 - ORGANIZATION AND BUSINESS

     General
     -------

     Sonicport, Inc. ("Sonicport") is a financial services company specializing
in the integration of proprietary software applications with Applications
Service Provider ("ASP") services. Sonicport's wholly owned subsidiary, US
Dataworks Inc. ("Dataworks"), develops, markets, and supports transaction
processing software for Windows NT computer systems. Its customer base includes
many of the largest financial institutions as well as credit card companies,
government institutions, and high-volume merchants in the United States. It also
has a strategic alliance with CheckFree Corporation (NASDAQ: CKFR) to license
Dataworks' software for its banking customers and Thomson Financial Publishing,
a unit of Thomson Corporation (TSE: TOC), to incorporate its EPICWare database
into Dataworks products.

     Acquisition
     -----------

     Effective March 31, 2001 and with a closing date of April 2, 2001,
Sonicport acquired 100%, or 3,571,429 shares, of the outstanding common stock of
Dataworks (formerly known as Allstate Dataworks, Inc.) in exchange for
14,666,667 new shares of Sonicport's common stock and warrants to purchase
1,000,000 shares of Sonicport's common stock. The warrants have an exercise
price of $0.73, vest immediately, and expire on April 2, 2006. In addition,
certain shareholders of Sonicport transferred their ownership in 4,000,000
shares of Sonicport's common stock to the shareholders of Dataworks and
committed to return 2,200,000 shares of Sonicport's common stock to Sonicport in
exchange for promissory notes in the amount of $220,000. These shareholders had
returned 1,528,000 shares at June 30, 2001. Of the Dataworks shares, 878,572
were acquired from officers of Dataworks who are also officers of Sonicport.

     The Company previously recorded the acquisition of US Dataworks in a manner
similar to a pooling of interests. Management has reassessed the facts and
circumstances of the transaction and has changed the method used to record the
acquisition from a manner similar to a pooling of interests to the purchase
method, which is in conformity with generally accepted accounting principles in
accordance with APB 16, "Business Combinations." The purchase price has been
allocated to the assets acquired and liabilities assumed based on the estimated
fair values at the date of acquisition. The excess of the purchase price over
the estimated fair value of the net assets acquired is attributed to goodwill
which is being amortized over seven years using the straight line method. The
results of operations of US Dataworks will be included in the consolidated
financial statements from April 1, 2001.

     The fair value of assets acquired and liabilities assumed is summarized as
follows:

     Accounts receivable...................................      $     179,583
     Property and equipment................................          2,238,782
     Goodwill..............................................         16,489,233
     Other assets..........................................             14,509
     Notes payable.........................................         (1,346,754)
     Accounts payable and accrued expenses.................            (43,841)
     Other liabilities.....................................            (41,293)
     Due from related parties..............................            (52,957)
                                                                 --------------
     Purchase price........................................      $  17,437,262
                                                                 ==============

     The aggregate purchase price was $17,437,262. The value of the 14,666,667
new shares of Sonicport's common stock issued and the 4,000,000 shares
transferred by certain shareholders of Sonicport to the shareholders of US
Dataworks of $16,893,334 was determined based on the average closing market
price of Sonicport's common stock over the period consisting of two days before
and after the terms of the acquisition agreement were agreed to and announced.
The value of the warrants to purchase 1,000,000 shares was determined to be
$543,928 and was derived using the Black Scholes option pricing model using the
following assumptions: expected life of 2 years, risk-free interest rate of
5.49%, expected volatility of 100% and expected dividend yield of 0%.

                                       7


<PAGE>

                                                SONICPORT, INC. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       June 30, 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 2 - RESTATEMENT

     The Company previously recorded the acquisition of US Dataworks in a manner
similar to a pooling of interests. Management has reassessed the facts and
circumstances of the transaction and has changed the method used to record the
acquisition from a manner similar to a pooling of interests to the purchase
method, which is in conformity with generally accepted accounting principles.
The effect of the restatement on net sales, cost of sales, gross profit, net
loss, basic and diluted loss per common share, current assets, property and
equipment, total assets, current liabilities, total liabilities and total
liabilities and shareholders' deficit as of and for the three months ended June
30, 2001 is as follows:
<TABLE>
<CAPTION>

                                                     AS ORIGINALLY         RESTATEMENT
                                                        REPORTED           ADJUSTMENTS         AS RESTATED
------------------------------------------------- --------------------- ------------------- ------------------
<S>                                                 <C>                   <C>                 <C>
Net Sales......................................     $     508,954         $          --       $     508,954
Cost of Sales..................................                --                    --                  --
Gross Profit...................................           508,954                    --             508,954
Net Loss.......................................        (2,633,685)             (648,051)         (3,281,736)
Loss Per Common Share:
   Basic.......................................             (0.06)                (0.02)              (0.08)
   Diluted.....................................             (0.06)                (0.02)              (0.08)
Current Assets.................................     $     731,719         $          --       $     731,719
Property and Equipment.........................         1,118,729             1,123,850           2,242,579
Goodwill.......................................                --            15,900,332          15,900,332
Total Assets...................................         1,862,405            17,024,182          18,886,587
Current Liabilities............................         3,552,766                    --           3,552,766
Total Liabilities..............................         4,210,216                    --           4,210,216
Total Liabilities and Shareholders' Equity.....     $   1,862,405         $  17,024,082       $  18,886,587
</TABLE>

     The effect of the restatement on net sales, cost of sales, gross profit,
net loss, basic and diluted loss per common share for the three months ended
June 30, 2000 is as follows:
<TABLE>
<CAPTION>

                                                     AS ORIGINALLY         RESTATEMENT
                                                        REPORTED           ADJUSTMENTS         AS RESTATED
------------------------------------------------- --------------------- ------------------- ------------------
<S>                                                 <C>                   <C>                 <C>
Net Sales......................................     $      47,500         $     (47,500)      $          --
Cost of Sales..................................                --                    --                  --
Gross Profit...................................            47,500               (47,500)                 --
Net Loss.......................................        (2,699,972)             (112,421)         (2,587,551)
Loss Per Common Share:
   Basic.......................................             (0.07)                (0.01)              (0.06)
   Diluted.....................................             (0.07)                (0.01)              (0.06)
</TABLE>

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Principles of Consolidation
     ---------------------------

     The consolidated financial statements include the accounts of Sonicport,
Inc. and its wholly owned subsidiaries, Sonicport.com, Inc. (the California
corporation), Sonicport POP's, Inc. (a California corporation), and US
Dataworks, Inc. (a Delaware corporation) (collectively, the "Company"). All
intercompany accounts and transactions have been eliminated.

                                       8


<PAGE>

                                                SONICPORT, INC. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       June 30, 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     Basis of Presentation
     ---------------------

     The unaudited, consolidated financial statements have been prepared in
conformity with generally accepted accounting principles for interim financial
information and with Regulation S-B. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all normal,
recurring adjustments considered necessary for a fair presentation have been
included. The unaudited, consolidated financial statements should be read in
conjunction with the audited financial statements and notes thereto included in
the Company's Annual Report on Form 10-KSB for the year ended March 31, 2001.
The results of operations for the three months ended June 30, 2001 are not
necessarily indicative of the results that may be expected for the year ended
March 31, 2002.

     Revenue Recognition
     -------------------

     The Company recognizes revenues in accordance with the provisions of the
American Institute of Certified Public Accountants' Statement of Position 97-2,
"Software Revenue Recognition." The Company licenses its software products under
nonexclusive, nontransferable license agreements. For software arrangements that
require significant production, modification, or customization, the entire
arrangement is accounted for in conformity with Accounting Research Bulletin No.
45, "Long-term Construction-Type Contracts," using the relevant guidance
Statement of Position 81-1, "Accounting for Performance of Construction-Type
Contracts and Certain Production-Type Contracts." For those arrangements that do
not require significant production, modification, or customization, revenue is
recognized when a license agreement has been signed, delivery of the software
product has occurred, the related fee is fixed or determinable, and
collectability is probable.

     In December 1999, Securities and Exchange Commission ("SEC") Staff
Accounting Bulletin ("SAB") No. 101, "Revenue Recognition in Financial
Statements," was issued. SAB No. 101 provides the SEC staff's views in applying
generally accepted accounting principles to selected revenue recognition issues,
including software revenue recognition. The Company adopted SAB No. 101 in the
fourth quarter of year ended March 31, 2001. Management does not expect the
adoption of SAB No. 101 will have a material effect on the Company's financial
position or results of operations.

     Goodwill
     --------

     In July 2001, the FASB issued Statement of Financial Accounting Standards
No. 142 ("SFAS 142"), "Goodwill and Other Intangible Assets," which is effective
for fiscal years beginning after December 15, 2001. SFAS 142 prohibits the
amortization of goodwill and intangible assets with indefinite useful lives but
requires that these assets be reviewed for impairment at least annually or on an
interim basis if an event occurs or circumstances change that could indicate
that their value has diminished or been impaired. Other intangible assets will
continue to be amortized over their estimated useful lives. The Company
evaluates the remaining useful lives of these intangibles on an annual basis to
determine whether events or circumstances warrant a revision to the remaining
period of amortization. Pursuant to SFAS 142, amortization of goodwill recorded
in business combinations prior to June 30, 2001 will cease effective March 31,
2002. Goodwill resulting from business combinations completed after June 30,
2001 will not be amortized. The Company recorded amortization expense of
$508,911 on goodwill during the three months ended June 30, 2001.

     The Company will test goodwill and intangible assets with indefinite lives
for impairment during the fiscal year beginning April 1, 2002 and any resulting
impairment charge will be reflected as a cumulative effect of a change in
accounting principle. Under SFAS 142, the Company is required to screen goodwill
for potential impairment by September 30, 2002 and measure the amount of
impairment, if any, by March 31, 2003.

     Advertising Expense
     -------------------

     Advertising costs are charged to expense as incurred. For the three months
ended June 30, 2001 and 2000, the Company recorded advertising expense of
$11,800 and $802,338, respectively.

                                       9


<PAGE>

                                                SONICPORT, INC. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       June 30, 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     Loss per Share
     --------------

     The Company calculates loss per share in accordance with SFAS No. 128,
"Earnings per Share." Basic loss per share is computed by dividing the loss
available to common shareholders by the weighted-average number of common shares
outstanding. Diluted loss per share is computed similar to basic loss per share
except that the denominator is increased to include the number of additional
common shares that would have been outstanding if the potential common shares
had been issued and if the additional common shares were dilutive.

     The following potential common shares have been excluded from the
computation of diluted net loss per share for the periods presented because the
effect would have been anti-dilutive:
<TABLE>
<CAPTION>

                                                                             For the Three Months Ended
                                                                                       June 30,
                                                                          --------------------------------
                                                                              2001                2000
                                                                          -------------      -------------
<S>                                                                       <C>                <C>
        Options outstanding under the Company's stock
            option plans                                                    2,900,000           1,278,250
        Options granted outside the Company's stock
            option plans                                                    1,050,250           1,050,250
        Warrants issued in conjunction with convertible
            Series B preferred stock                                          642,999                  --
        Warrants issued in conjunction with private
            placements                                                        287,358                  --
        Warrants issued as a financing cost for notes
            payable and convertible notes payable                           1,599,000              74,000
        Warrants issued in conjunction with lock-up
            agreements                                                        369,789                  --
        Warrants issued for services rendered                                 500,000                  --
        Warrants issued as part of the acquisition of
            Dataworks                                                       1,000,000                  --
        Convertible Series A preferred stock                                  640,000                  --
        Convertible Series B preferred stock                                  843,999                  --
</TABLE>

     Recently Issued Accounting Pronouncements
     -----------------------------------------

     In July 2001, the FASB issued SFAS No. 141, "Business Combinations." This
statement addresses financial accounting and reporting for business combinations
and supersedes Accounting Principles Bulletin ("APB") Opinion No. 16, "Business
Combinations," and SFAS No. 38, "Accounting for Pre-Acquisition Contingencies of
Purchased Enterprises." All business combinations in the scope of this statement
are to be accounted for using one method, the purchase method. The provisions of
this statement apply to all business combinations initiated after June 30, 2001.
Use of the pooling-of-interests method for those business combinations is
prohibited. This statement also applies to all business combinations accounted
for using the purchase method for which the date of acquisition is July 1, 2001
or later.

                                       10


<PAGE>

                                                SONICPORT, INC. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       June 30, 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 4 - DISPOSAL OF OPERATIONS

     Effective July 31, 2001, management of the Company formally decided to
start shutting down the operations of the Company's Internet service provider,
SeeYouOnline. All assets of SeeYouOnline were retained by the Company, except
for $69,694 of accounts receivable, net of an allowance for doubtful accounts of
$92,223, $128,817 of prepaid expenses, $12,012 of due from related party,
$197,324 of accounts payable, and $36,975 of deferred revenue. As a result, the
operations of SeeYouOnline through June 30, 2001 are reported as discontinued
operations. The results from discontinued operations included total revenues of
$116,752 and net income from operations of $63,055 for the three months ended
June 30, 2001. SeeYouOnline ceased providing Internet access services on August
15, 2001.

NOTE 5 - PROPERTY AND EQUIPMENT

     Property and equipment at June 30, 2001 consisted of the following:

           Furniture and fixtures                                $     13,982
           Telephone equipment                                         92,009
           Computer equipment                                         319,215
           Computer Software                                        2,223,000
           Leasehold improvements                                       6,575
                                                                 -------------
                                                                    2,654,781
           Less accumulated depreciation and amortization             412,202
                                                                 -------------
                    TOTAL                                        $  2,242,579
                                                                 =============

     Depreciation and amortization expense for the three months ended June 30,
2001 and 2000 was $132,662 and $39,184, respectively. At June 30, 2001,
$1,125,000 of computer equipment had not been put into service, and therefore,
no depreciation has been recorded on that equipment.

NOTE 6 - NOTE PAYABLE

     During April 2001, the Company paid off notes payable in the amounts of
$47,000 and $30,000.

NOTE 7 - NOTES PAYABLE - RELATED PARTIES

     On January 22, 2001, the Company entered into a note payable with a
shareholder for $50,000. The note is non-interest-bearing, is unsecured, and is
due on demand. As of June 30, 2001, the outstanding balance on the note was
$39,000.

     The note payable - affiliate was originally issued by Dataworks on July 12,
2000, bore interest at 18% per annum, was unsecured, and was due on demand. On
April 2, 2001, the Company refinanced the note payable - affiliate with the same
affiliate. The new note is for $1,315,000, which includes the previous note for
$1,127,500, accrued interest for $136,000, and $51,500 of the amount due to
related party as of March 31, 2001. The note is for a two-year term and bears
interest at 10% per annum. Interest and principal payments are due monthly. The
note payable-affiliate was assumed by the Company as part of its purchase of
Dataworks.

     On April 2, 2001, as part of the Share Agreement between Sonicport and
Dataworks, certain founding shareholders committed to return 2,200,000 shares of
Sonicport common stock in exchange for two-year promissory notes, bearing
interest at 10% per annum, in the amount of $220,000. At June 30, 2001,
1,528,000 shares had been returned by the shareholders.

                                       11


<PAGE>

                                                SONICPORT, INC. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       June 30, 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 8 - CONVERTIBLE PROMISSORY NOTES

     On April 25, 2001, the Company received $350,000 under a Subscription
Agreement it signed on March 26, 2001. On May 15, 2001, the Company entered into
a Subscription Agreement for gross proceeds of $400,000. Each unit consisted of
a convertible promissory note and a warrant to purchase one share of the
Company's common stock for each dollar borrowed by the Company. The holder of
the note has the option to convert the note at any time after 90 days following
the issuance date of the note.

     The Company has the option to redeem the notes at any time prior to the
notes' maturity date at 125% of the face value of the notes if the notes are
redeemed within 90 days of the issuance date of the notes or at 110% of the face
value of the notes if the notes are redeemed more than 90 days from the issuance
date of the notes. The notes are convertible at the lesser of 80% of the average
closing price for the 20 trading days immediately preceding the conversion date
or $0.40 per share. The notes earn interest at 10% per annum, and the principal
and any unpaid interest are due on March 26, 2002 and May 15, 2002.

     In accordance with generally accepted accounting principles, the difference
between the conversion price and the Company's stock price on the date of
issuance of the notes is considered to be interest expense. It will be
recognized in the statement of operations during the period from the issuance of
the notes to the time at which the notes first become convertible. In connection
with the issuance of the notes, the Company recorded deferred financing costs of
$175,000 as a current asset and interest expense of $603,750 in the statement of
operations for the three months ended June 30, 2001.

     Each warrant entitles the holder to purchase one share of the Company's
common stock at $1 per share, and it expires three years from the date of
issuance. The Company allocates the proceeds received from debt or convertible
debt with detachable warrants using the relative fair value of the individual
elements at the time of issuance. The amount allocated to the warrants as a debt
discount was calculated at $112,500 using the interest method and will be
recognized as interest expense over the period until the notes mature or are
converted. In the event the debt is settled prior to the maturity date, an
expense will be recognized based on the difference between the carrying amount
and the amount of the payment.

NOTE 9 - CONVERTIBLE PROMISSORY NOTES - RELATED PARTIES

     On January 17 and January 26, 2000, the Company entered into a Subscription
Agreement for two, 10% Convertible Promissory Notes (the "January Notes") for
$100,000 and $150,000, respectively, with a director of the Company. The holder
of the January Notes has the option to convert the January Notes at any time
after the closing date of the January Notes. The January Notes are convertible
at the lesser of $2.50 or 75% of the average closing bid price of the Company's
common stock for the five trading days prior to conversion. Interest is due on
the January Notes on April 1 and October 1. Principal and any unpaid interest
are due on February 28, 2002 if the January Notes have not been converted prior
to such date by either party to the January Notes.

NOTE 10 - SHAREHOLDERS' EQUITY

     Convertible Series B Preferred Stock
     ------------------------------------

     In May 2001, an investor in the Company's Convertible Series B Preferred
Stock rescinded its acquisition and returned 13,333 shares to the Company in
exchange for its investment of $10,000.

     Common Stock for Lock-Up Agreements
     -----------------------------------

     During June 2001, the Company issued 72,716 shares of common stock valued
at $6,781 to certain purchasers of the Company's common stock as consideration
for the purchasers to enter into lock-up agreements for the sale of their shares
of common stock. The shares were recognized as financing costs in the statement
of operations for the three months ended June 30, 2001.

                                       12


<PAGE>

                                                SONICPORT, INC. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       June 30, 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 10 - SHAREHOLDERS' EQUITY (CONTINUED)

     Issuance of Committed Shares
     ----------------------------

     During June 2001, the Company issued 475,000 shares of common stock valued
at $255,000 that had been committed at March 31, 2001.

     Sale of Common Stock
     --------------------

     During the three months ended June 30, 2001, the Company issued 286,857
shares of common stock for proceeds of $104,654.

     Common Stock Issued for Services Rendered
     -----------------------------------------

     During the three months ended June 30, 2001, the Company issued 400,000
shares of common stock as payment for services rendered valued at $32,000.

     Stock Options
     -------------

     During the three months ended June 30, 2001, the Company granted 1,365,000
stock options to certain employees and non-employees at exercise prices between
$1 and $1.25.

     Warrants for Lock-Up Agreements
     -------------------------------

     During June 2001, the Company issued 60,000 warrants to certain purchasers
of the Company's common stock as consideration for the purchasers to enter into
lock-up agreements for the sale of their shares of common stock. The warrants
have an exercise price of $1, vest immediately, and expire three years from the
date of issuance. The warrants were valued at $11,520 using the Black-Scholes
option pricing model and were recognized as financing costs in the statement of
operations for the three months ended June 31, 2001.

NOTE 11 - SEGMENT INFORMATION

     The Company has two business units that have separate management and
reporting infrastructures that offer different products and services. The
business units have been aggregated into two reportable segments: ASP and
Licensing. The ASP group sells application service provider services to third
parties. The Licensing group licenses the Company's RemitWorks and RemoteWorks
software products to third parties and performs credit information verification
services for an affiliated company using software purchased from that affiliated
company. Most corporate expenses, such as internal administrative costs, legal
expenses, and debt issuance costs, are included in the ASP group.

     Summarized financial information concerning the Company's reportable
segments is shown in the following table for the three months ended June 31,
2001:
<TABLE>
<CAPTION>

                                                 ASP                 Licensing           Consolidated
                                          -------------------    ------------------    ------------------
<S>                                       <C>                    <C>                   <C>
Identifiable assets                       $       16,306,680     $       2,579,907     $      18,886,587
Sales to unaffiliated customers           $               --     $         273,777     $         273,777
Net loss                                  $      (3,050,726)     $       (231,010)     $     (3,281,736)
</TABLE>

                                       13


<PAGE>

                                                SONICPORT, INC. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                       June 30, 2001 (unaudited)
--------------------------------------------------------------------------------

NOTE 12 - SUBSEQUENT EVENTS

     Sale of Common Stock
     --------------------

     Subsequent to June 30, 2001, the Company issued 800,000 shares of common
stock for proceeds of $200,000.

     Common Stock for Lock-Up Agreements
     -----------------------------------

     During July 2001, the Company issued 79,061 shares of common stock valued
at $39,530 to certain purchasers of the Company's common stock as consideration
for the purchasers to enter into lock-up agreements for the sale of their shares
of common stock.

                                       14


<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS

PRELIMINARY NOTE REGARDING FORWARD-LOOKING STATEMENTS: ALL FORWARD-LOOKING
STATEMENTS CONTAINED HEREIN ARE DEEMED BY THE COMPANY TO BE COVERED BY AND TO
QUALIFY FOR THE SAFE HARBOR PROTECTION PROVIDED BY THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995. THE SHAREHOLDERS AND PROSPECTIVE SHAREHOLDERS
SHOULD UNDERSTAND THAT SEVERAL FACTORS GOVERN WHETHER ANY FORWARD-LOOKING
STATEMENT CONTAINED HEREIN WILL BE OR CAN BE ACHIEVED. ANY ONE OF THOSE FACTORS
COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE PROJECTED HEREIN.
THESE FORWARD-LOOKING STATEMENTS INCLUDE PLANS AND OBJECTIVES OF MANAGEMENT FOR
FUTURE OPERATIONS, INCLUDING PLANS AND OBJECTIVES RELATING TO THE PRODUCTS AND
THE FUTURE ECONOMIC PERFORMANCE OF THE COMPANY. ASSUMPTIONS RELATING TO THE
FOREGOING INVOLVE JUDGMENTS WITH RESPECT TO, AMONG OTHER THINGS, FUTURE
ECONOMIC, COMPETITIVE AND MARKET CONDITIONS, FUTURE BUSINESS DECISIONS, AND THE
TIME AND MONEY REQUIRED TO SUCCESSFULLY COMPLETE DEVELOPMENT PROJECTS, ALL OF
WHICH ARE DIFFICULT OR IMPOSSIBLE TO PREDICT ACCURATELY AND MANY OF WHICH ARE
BEYOND THE CONTROL OF THE COMPANY. ALTHOUGH THE COMPANY BELIEVES THAT THE
ASSUMPTIONS UNDERLYING THE FORWARD-LOOKING STATEMENTS CONTAINED HEREIN ARE
REASONABLE, ANY OF THOSE ASSUMPTIONS COULD PROVE INACCURATE AND, THEREFORE,
THERE CAN BE NO ASSURANCE THAT THE RESULTS CONTEMPLATED IN ANY OF THE
FORWARD-LOOKING STATEMENTS CONTAINED HEREIN WILL BE REALIZED. BASED ON ACTUAL
EXPERIENCE AND BUSINESS DEVELOPMENT, THE COMPANY MAY ALTER ITS MARKETING,
CAPITAL EXPENDITURE PLANS OR OTHER BUDGETS, WHICH MAY IN TURN, AFFECT THE
COMPANY'S RESULTS OF OPERATIONS. IN LIGHT OF THE SIGNIFICANT UNCERTAINTIES
INHERENT IN THE FORWARD-LOOKING STATEMENTS INCLUDED THEREIN, THE INCLUSION OF
ANY SUCH STATEMENT SHOULD NOT BE REGARDED AS A REPRESENTATION BY THE COMPANY OR
ANY OTHER PERSON THAT THE OBJECTIVES OR PLANS OF THE COMPANY WILL BE ACHIEVED.

OVERVIEW OF THE COMPANY'S BUSINESS

     SonicPort, Inc. ("Sonicport" or the "Company") is a financial services
application service provider specializing in integrating transaction processing
software, supported by broadband hosting, technical expertise and customer
service. Additional value-added services include customer software development
and strategic marketing and planning. Effective April 2, 2001, the Company
acquired US Dataworks, Inc. ("Dataworks"). Dataworks is a leading developer of
transaction processing software serving the banking and Automated Clearing House
(ACH) processing industries. Dataworks develops, markets and supports
transaction-processing software for Windows NT computer systems. Dataworks
enables organizations to transition from traditional paper-based payment and
billing processes to electronic solutions. Dataworks is able to generate primary
revenue from the licensing and collecting of transaction fees from its core
products; Remoteworks, Remitworks, MICRworks, and Returnworks. Dataworks'
systems are designed to integrate with solutions and service offerings of other
financial software service companies and financial institutions in order to
minimize the expense of adding features or customization. Dataworks also has a
strategic alliance with CheckFree Corporation (NASDAQ:CKFR) to license
Dataworks' software for its banking customers and Thomson Financial Publishing,
a unit of Thomson Corporation (TSE:TOC) to incorporate Thomson's EPICWare
database into Dataworks' products.

RESULTS OF OPERATIONS

     The Company recognized revenues of $508,954 for the three months ended June
30, 2001 as compared with $0 for the three months ended June 30, 2000. The
increase in revenue was due to the following:

          o    The Company's Application Service Provider ("ASP") became
               operational in April 2001, bringing in revenues of $235,177.

          o    Licensing revenues to unrelated third parties increased from $0
               in 2000 to $273,777 in 2001 due to the acquisition of Dataworks.

                                       15


<PAGE>

     General and administrative expenses for the three months ended June 30,
2001 were $1,830,386 as compared with $1,623,189 for the three months ended June
30, 2000. This is an increase of $207,197 due principally to the acquisition of
Dataworks, which was partially offset by the elimination and consolidation of a
portion of the Company's overhead, including moving to a new location, the
release of some employees, and the scaling back of the Internet Service Provider
("ISP") operations.

     Other expenses, including interest expense and financing costs, were
increased during the first quarter ending June 2002, to $1,985,522 for the three
months ended June 30, 2001 compared to $8,880 for the three months ended June
30, 2000. This is attributable to the financing costs related to the issuance of
the notes payable and related 90-day convertible features of the promissory
notes issued from March 2001 through May 2001.

     The ISP business had income from operations of $63,055 for the three months
ended June 30, 2001 compared to a loss of $1,003,942 for the three month period
ended June 30, 2000. In April 2000 the Company began operations of its Internet
service provider. Revenues remained low and costs continued to increase.
Management made a decision to discontinue providing this service, effective
August 2001. The cessation of this division will increase profit margins and the
overall operating performance of the Company.

     Net loss for the quarter ended June 30, 2001 increased by $694,185 from a
net loss of $2,587,551 in June 2000 to a net loss of $3,281,736 for the same
period in 2001. The increase is primarily due to the acquisition of Dataworks,
which was partially offset by the decrease in costs due to moving to a new
location, the release of some employees, and the scaling back of the ISP
operations.

LIQUIDITY AND CAPITAL RESOURCES

     As of June 30, 2001, the Company had $249,098 in cash and cash equivalents.
Subsequent to June 30, 2001, the Company received $200,000 through the issuance
of 800,000 shares of common stock. The Company is raising funds for working
capital and continued growth of the Company's operations.

     The Company's working capital deficit at June 30, 2001 was $2,821,047 as
compared with $270,250 at June 30, 2000, an increase in the working capital
deficit of $2,530,797 during the 12-month period.

     The Company continues its efforts to raise funds for working capital and
the development of the Company's operations through private placements of
equity, although no assurance can be given that funds will be available. To the
extent of a shortfall in required funds, the Company may be required to curtail
the implementation of its business plan, and reduce or cease operations.

FACTORS THAT MAY AFFECT FUTURE RESULTS AND MARKET PRICE OF STOCK

     The Company operates in a rapidly changing environment that involves
numerous risks, some of which are beyond the Company's control. The following
discussion highlights some of these risks.

REVENUE GROWTH AND ECONOMIC CONDITIONS

     The revenue growth and profitability of the Company's business depends on
the overall demand for computer software and services in the product segments in
which the Company competes. Because the Company's sales are primarily to major
banking and government customers, the Company's business also depends on general
economic and business conditions. A softening of demand caused by a weakening of
the economy may result in decreased revenues or lower growth rates. There can be
no assurances that the Company will be able to effectively promote future
license revenue growth in its application business.

EXPECTED POTENTIAL FLUCTUATION IN PLAN OF OPERATIONS

     The Company expects that its operating results may fluctuate significantly
as a result of a variety of factors, many of which are outside the Company's
control. Factors that may affect the Company's quarterly operating results
include: (i)the Company's ability to attract and retain clients and maintain
their satisfaction; (ii) the announcement or introduction of new software,
services and products by the Company or its competitors; (iii) the success of

                                       16


<PAGE>

the Company's brand building and marketing campaigns; (iv) price competition;
(v) the Company's ability to upgrade and develop its systems and infrastructure
to accommodate growth; (vi) the Company's ability to attract new personnel in a
timely and effective manner; (vii) technical difficulties or service
interruptions; (viii) the amount and timing of operating costs and capital
expenditures relating to expansion of the Company's business, operations and
infrastructure; (ix) consumer trends; (x) governmental regulation by federal or
local governments; and (xi) general economic conditions as well as economic
conditions specific to the financial services industry.

     Because of the emerging nature of the markets in which the Company
competes, it is difficult for the Company to forecast its revenues or earnings
accurately. The Company's current and future expense levels expectations are
based largely on its investment plans and estimates of future revenues and are,
to a large extent, fixed. The Company may be unable to adjust spending in a
timely manner to compensate for any unexpected revenue shortfall. Accordingly,
any significant shortfall in revenues relative to the Company's planned
expenditures would have an immediate adverse effect on the Company's business,
results of operations and financial condition. Further, as a strategic response
to changes in the competitive environment, the Company may from time to time
make certain pricing, service or marketing decisions that could have a material
adverse effect on its business, results of operations and financial condition.

COMPETITION

     The primary competitive factors determining success in the financial
services software market are:

          o    reputation for reliability and service;

          o    effective customer support;

          o    pricing;

          o    easy-to-use software; and

          o    geographic coverage.

     The market for financial services software is relatively new, highly
competitive, rapidly evolving and subject to rapid technological change. While
relatively new, the market is already highly competitive and characterized by an
increasing number of entrants who have introduced or developed products and
services similar to those offered by the Company. The Company expects
competition not only to persist but also to increase. Increased competition may
result in price reductions, reduced margins and loss of market share. The
Company has identified eleven competitive vendors in the market; Bank One,
BankServ, CheckAGAIN, CheckFast, Inc., The EFT Network, Inc., eFunds
Corporation, Equifax Check Solutions, Global eTelecom, Inc., Integrated Check
Technologies, LML Payment Systems, Princeton eCom, Provident Bank,
SolutranXpressCheX, Inc., and RCK Services.

     Some of the current and potential competitors have longer operating
histories, larger installed customer bases, greater name recognition, and longer
relationships with clients and significantly greater financial, technical,
marketing and public relations resources than the Company does. At any time the
Company's current and potential competitors could increase their resource
commitments to Sonicport's markets. The Company expects to face additional
competition from new market entrants in the future, as the barriers to entry
into this business are also relatively low. The Company's current or future
competitors may also be better positioned to address technological and market
developments or may react more favorably to technological changes. The Company
competes on the basis of a number of factors, including the breadth and quality
of services, creative design and systems engineering expertise, pricing, and
technological innovation and understanding clients' strategies and needs. Many
of these factors are beyond the Company's control. Existing or future
competitors may develop or offer strategic services that provide significant
technological, creative, performance, price or other advantages over the
services offered by Sonicport. As a result, the Company's financial condition,
operating results and business could be adversely affected and the value of the
investment in the Company could be reduced significantly.

                                       17


<PAGE>

NO ASSURANCE OF PROFITABILITY

     The Company believes that the planned growth and profitability will depend
in large part on its ability to promote its brand name and gain and expand
clients for whom the Company would provide its ASP services and licensing
agreements. Accordingly, the Company intends to invest heavily in marketing and
promotion, development of its clients, development of its marketing technology
and operating infrastructure development.

DEPENDENCE ON KEY PERSONNEL

     The Company's performance is substantially dependent on the continued
services and on the performance of its senior management and other key
personnel. The Company's performance also depends on the Company's ability to
retain and motivate its other officers and key employees. The loss of the
services of any of its executive officers or other key employees could have a
material adverse effect on the Company's business, results of operations and
financial condition. The Company's future success also depends on its ability to
identify, attract, hire, train, retain and motivate other highly skilled
technical, managerial, marketing and customer service personnel. Competition for
such personnel is intense, and there can be no assurance that the Company will
be able to successfully attract, integrate or retain sufficiently qualified
personnel. The failure to retain and attract the necessary personnel could have
a material adverse effect on the Company's business, results of operations and
financial condition.

RISK OF SYSTEM FAILURES

     The Company's success with respect to its financial services products, and
in particular its ability to provide high quality customer service, will depend
on the efficient and uninterrupted operation of its computer and communications
hardware systems. These systems and operations are generally vulnerable to
damage or interruption from earthquakes, floods, fires, power loss,
telecommunication failures, break-ins, sabotage, intentional acts of vandalism
and similar events. Despite any precautions taken by, or planned by the Company,
the occurrence of a natural disaster or other unanticipated problems could
result in interruptions in the services provided by the Company. In addition,
failure to provide the data communications capacity required by the Company, as
a result of human error, natural disaster or other operational disruption, could
result in interruptions in the Company's service. Any damage to or failure of
the systems of the Company could result in reductions in, or terminations of the
ASP service, which could have a material adverse effect on the Company's
business, results of operations and financial condition. In the case of frequent
or persistent system failures, the Company's reputation and name brand could be
materially adversely affected.

RAPID TECHNOLOGICAL CHANGE

     Rapidly changing technology, evolving industry standards, introductions and
enhancements and changing customer demands characterize the market in which the
Company competes. The Company's future success will depend on its ability to
adapt to rapidly changing technologies, to adapt its services to evolving
industry standards and to continually improve the performance, features and
reliability of its service in response to competitive service and product
offerings and evolving demands of the marketplace. The failure of the Company to
adapt to such changes would have a material adverse effect on the Company's
business, results of operations and financial condition.

LEGAL LIABILITY TO SONICPORT CLIENTS

     Many of the Company's engagements involve the development and
implementation of software that are important to the Company's future clients'
businesses. The Company's failure or inability to meet a client's expectations
in the performance of services could injure Sonicport's business reputation or
result in a claim for substantial damages against the Company regardless of its
responsibility for such failure. In addition, the services Sonicport will
provide for its clients may include confidential or proprietary client
information. Although the Company has implemented policies to prevent such
client information from being disclosed to unauthorized parties or used
inappropriately, any such unauthorized disclosure or use could result in a claim
against the Company for substantial damages. The Company's contractual
provisions attempting to limit such damages may not be enforceable in all
instances or may otherwise fail to protect the Company from liability for
damages.

                                       18


<PAGE>

POSSIBLE VOLATILITY OF STOCK PRICE

     The trading price of the Common Stock might be highly volatile and could be
subject to wide fluctuations in response to factors such as actual or
anticipated variations in the Company's quarterly operating results,
announcements of technological innovations, or new services by the Company or
its competitors, changes in financial estimates by securities analysts,
announcements by the Company or its competitors of significant acquisitions,
strategic partnerships, joint ventures or capital commitments, additions or
departures of key personnel, sales of Common Stock or other securities of the
Company in the open market and other events or factors, many of which are beyond
the Company's control. There can be no assurance that these trading prices and
valuations will be sustained. These broad market and industry factors may
materially and adversely affect the market price of the Common Stock, regardless
of the Company's operating performance. Market fluctuations, as well as general
political and economic conditions such as recession or interest rate or currency
rate fluctuations, may also adversely affect the market price of the Common
Stock.

CONTROL BY PRINCIPAL STOCKHOLDERS, EXECUTIVE OFFICERS AND DIRECTORS

     The Company's executive officers and directors (and their affiliates), in
the aggregate, own more than 61% of the Company's outstanding Common Stock. As a
result, such persons, acting together, have the ability to control all matters
submitted to stockholders of the Company for approval (including the election
and removal of directors and any merger, consolidation or sale of all or
substantially all of the Company's assets) and to control the management and
affairs of the Company. Accordingly, such concentration of ownership may have
the effect of delaying, deferring or preventing a change in control of the
Company, impede a merger, consolidation, takeover or other business combination
involving the Company or discourage a potential acquirer from making a tender
offer or otherwise attempting to obtain control of the Company, which in turn
could have an adverse effect on the market price of the Company's Common Stock.

SHARES ELIGIBLE FOR FUTURE SALE

     As of June 30, 2001, there were approximately 44,733,379 shares of Common
Stock outstanding, of which at least 36,133,221 are restricted securities
("Restricted Securities") under the Securities Act, a majority of which are held
by affiliates of the Company. These Restricted Securities will be eligible for
sale from time to time upon expiration of applicable holding periods under Rule
144 under the Securities Act. If such holders sell in the public market, such
sales could have a material adverse effect on the market price of the Company's
Common Stock. In general, under Rule 144, subject to the satisfaction of certain
other conditions, a person, including an affiliate of the Company, who has
beneficially owned restricted shares of Common Stock for at least one year is
entitled to sell, in certain brokerage transactions, within any three-month
period, a number of shares that does not exceed the greater of 1% of the total
number of outstanding shares of the same class, or if the Common Stock is quoted
on AMEX or a stock exchange, the average weekly trading volume during the four
calendar weeks immediately preceding the sale. A person who presently is not and
who has not been an affiliate of the Company for at least three months
immediately preceding the sale and who has beneficially owned the shares of
Common Stock for at least two years is entitled to sell such shares under Rule
144 without regard to any of the volume limitations described above.

ENFORCEMENT OF THE COMPANY'S INTELLECTUAL PROPERTY RIGHTS

     The Company relies on a combination of patent, trademark trade secrets,
confidentiality procedures and contractual procedures to protect its
intellectual property rights. Despite the Company's efforts to protect its
intellectual property rights, it may be possible for unauthorized third parties
to obtain and use technology or other information that the Company regards as
proprietary. These can also be no assurances that the Company's intellectual
property rights would survive a legal challenge to their validity or provide
significant protection for the Company.

                                       19


<PAGE>

                          PART II - OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

     (a)  Exhibits:

     The exhibit listed below is required by Item 601 of Regulation S-B.

   EXHIBIT
    NUMBER                             DESCRIPTION OF DOCUMENT
    ------                             -----------------------

     99.1      Statement of Chief Executive Officer and Chief Financial Officer
               under 18 U.S.C. ss. 1350

     (b) Reports on Form 8-K.

     The Company did not file any reports on Form 8-K with the Securities and
Exchange Commission during the three months ended June 30, 2001.

                                       20


<PAGE>

                                    SIGNATURE

     In accordance with the requirements of the Exchange Act, the registrant
caused this amendment to report to be signed on its behalf by the undersigned,
thereunto duly authorized.

     Dated: June 10, 2003

                                 US DATAWORKS, INC.

                                 By /s/ John S. Reiland
                                    --------------------------------------------
                                    John S. Reiland
                                    Chief Financial Officer
                                    (Principal Financial and Accounting Officer)

                                       21


<PAGE>

CERTIFICATIONS
--------------

I, Charles E. Ramey, certify that:

1. I have reviewed this quarterly report on Form 10-QSB/A, Amendment No. 1 to
Form 10-QSB, of US Dataworks, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report; and

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report.

Dated: June 10, 2003

                                                  /s/ Charles E. Ramey
                                                  ------------------------------
                                                  Charles E. Ramey
                                                  Chief Executive Officer

                                       22


<PAGE>

I, John S. Reiland, certify that:

1. I have reviewed this quarterly report on Form 10-QSB/A, Amendment No. 1 to
Form 10-QSB, of US Dataworks, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report; and

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report.

Dated: June 10, 2003

                                                  /s/ John S. Reiland
                                                  ------------------------------
                                                  John S. Reiland
                                                  Chief Financial Officer

                                       23


<PAGE>

                                  EXHIBIT INDEX
                                  -------------

   EXHIBIT
    NUMBER                   DESCRIPTION OF DOCUMENT
    ------                   -----------------------

     99.1           Statement of Chief Executive Officer and Chief Financial
                    Officer under 18 U.S.C. ss. 1350