Exhibit 4.4**REGISTRATION RIGHTS AGREEMENT**          **REGISTRATION RIGHTS AGREEMENT**(this “**Agreement**”), dated as of November 13, 2007, by and amongUS Dataworks, Inc., a Nevada corporation, with headquarters located at One Sugar Creek CenterBlvd., Fifth Floor, Sugar Land, Texas 77478 (the “**Company**”), and the undersigned buyers (each, a“**Buyer**”, and collectively, the “**Buyers**”).          **WHEREAS:**          A. In connection with the Securities Purchase Agreement by and among the parties hereto ofeven date herewith (the “**Securities Purchase Agreement**”), the Company has agreed, upon the termsand subject to the conditions set forth in the Securities Purchase Agreement, to issue and sell toeach Buyer (i) senior secured convertible notes of the Company (the “**Notes**”), which will, amongother things, be convertible into shares of the Company’s common stock, $0.0001 par value per share(the “**Common Stock**”, as converted, the “**Conversion Shares**”) in accordance with the terms of theNotes, and (ii) warrants (the “**Warrants**”), which will be exercisable to purchase shares of CommonStock (as exercised collectively, the “**Warrant Shares**”).          B. To induce the Buyers to execute and deliver the Securities Purchase Agreement, the Companyhas agreed to provide certain registration rights under the Securities Act of 1933, as amended, andthe rules and regulations thereunder, or any similar successor statute (collectively, the “**1933Act**”), and applicable state securities laws.          **NOW, THEREFORE,**in consideration of the premises and the mutual covenants contained herein andother good and valuable consideration, the receipt and sufficiency of which are herebyacknowledged, the Company and each of the Buyers hereby agree as follows:          1. Definitions.          Capitalized terms used herein and not otherwise defined herein shall have the respectivemeanings set forth in the Securities Purchase Agreement. As used in this Agreement, the followingterms shall have the following meanings:               a. “**Additional Effectiveness Date**” means the date the Additional Registration Statement isdeclared effective by the SEC.               b. “**Additional Effectiveness Deadline**” means the date seventy-five (75) calendar days afterthe Additional Filing Date.               c. “**Additional Filing Date**” means the date on which the Additional Registration Statement isfiled with the SEC.               d. “**Additional Filing Deadline**” means if Cutback Shares are required to be included in anyAdditional Registration Statement, the later of (i) the date sixty (60) days after the datesubstantially all of the Registrable Securities registered under the immediately preceding
 

 
Registration Statement are sold and (ii) the date six (6) months from the Initial Effective Date orthe last Additional Effective Date, as applicable.               e. “**Additional Registrable Securities**” means (i) any Cutback Shares not previously included ona Registration Statement and (ii) any capital stock of the Company issued or issuable with respectto the Notes, the Conversion Shares or Cutback Shares, as applicable, as a result of any stocksplit, stock dividend, recapitalization, exchange or similar event or otherwise, without regard toany limitations on conversions of the Notes.               f. “**Additional Registration Statement**” means a registration statement or registrationstatements of the Company filed under the 1933 Act covering any Additional Registrable Securities.               g. “**Additional Required Registration Amount**” means any Cutback Shares not previously includedon a Registration Statement, all subject to adjustment as provided in Section 2(f), without regardto any limitations on conversions of the Notes.               h. “**Business Day**” means any day other than Saturday, Sunday or any other day on whichcommercial banks in the City of New York are authorized or required by law to remain closed.               i. “**Closing Date**” shall have the meaning set forth in the Securities Purchase Agreement.               j. “**Cutback Shares**” means any of the Initial Required Registration Amount (without regard toclause (ii) in the definition thereof) of Registrable Securities not included in all RegistrationStatements previously declared effective hereunder as a result of a limitation on the maximumnumber of shares of Common Stock of the Company permitted to be registered by the staff of the SECpursuant to Rule 415.               k. “**Effective Date**” means the Initial Effective Date and the Additional Effective Date, asapplicable.               l. “**Effectiveness Deadline**” means the Initial Effectiveness Deadline and the AdditionalEffectiveness Deadline, as applicable.               m. “**Filing Date**” means the Initial Filing Date and the Additional Filing Date, as applicable.               n. “**Filing Deadline**” means the Initial Filing Deadline and the Additional Filing Deadline, asapplicable.               o. “**Initial Effective Date**” means the date the Initial Registration Statement has beendeclared effective by the SEC.               p. “**Initial Effectiveness Deadline**” means the earlier of the date which is (i) in the eventthat the Initial Registration Statement is not subject to a full review by the SEC, ninety (90)calendar days after the Closing Date or (ii) in the event that the Registration
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Statement issubject to a full review by the SEC, one-hundred and twenty (120) calendar days after the ClosingDate.               q. “**Initial Filing Date**” means the date the Initial Registration Statement has been filed withthe SEC.               r. “**Initial Filing Deadline**” means the date thirty (30) calendar days after the Closing Date.               s. “**Initial Registrable Securities**” means (i) the Conversion Shares issued or issuable uponconversion of the Notes, (ii) the Warrant Shares issued or issuable upon exercise of the Warrantsand (iii) any shares of capital stock of the Company issued or issuable with respect to theConversion Shares, the Notes, the Warrant Shares and the Warrants as a result of any stock split,stock dividend, recapitalization, exchange or similar event or otherwise, without regard to anylimitations on conversions of the Notes or exercises of the Warrants.               t. “**Initial Registration Statement**” means a registration statement or registration statementsof the Company filed under the 1933 Act covering the Initial Registrable Securities.               u. “**Initial Required Registration Amount**” for the Registration Statement means (I) 130% of thesum of (i) the aggregate of the maximum number of Conversion Shares issued and issuable pursuant tothe Notes at the then applicable Conversion Price as of the Trading Day (as defined in the Notes)immediately preceding the applicable date of determination and (ii) the number of Warrant Sharesissued and issuable pursuant to the Warrants as of the trading day immediately preceding theapplicable date of determination, all subject to adjustment as provided in Section 2(e) (withoutregard to any limitations on conversion of the Notes or exercise of the Warrants) or (II) suchother amount as may be required by the staff of the SEC pursuant to Rule 415 with any cutbackapplied pro rata to all Registrable Securities.               v. “**Investor**” means a Buyer or any transferee or assignee thereof to whom a Buyer assigns itsrights as a holder of Registrable Securities under this Agreement and who agrees to become bound bythe provisions of this Agreement in accordance with Section 9 and any transferee or assigneethereof to whom a transferee or assignee assigns its rights as a holder of Registrable Securitiesunder this Agreement and who agrees to become bound by the provisions of this Agreement inaccordance with Section 9.               w. “**Person**” means an individual, a limited liability company, a partnership, a joint venture,a corporation, a trust, an unincorporated organization and a government or any department or agencythereof.               x. “**register**,” “**registered**,” and “**registration**” refer to a registration effected by preparingand filing one or more Registration Statements (as defined below) incompliance with the 1933 Act and pursuant to Rule 415 and the declaration or ordering ofeffectiveness of such Registration Statement(s) by the SEC.
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               y. “**Registrable Securities**” means the Initial Registrable Securities and the AdditionalRegistrable Securities.               z. “**Registration Statement**” means the Initial Registration Statement and the AdditionalRegistration Statement, as applicable.               aa. “**Required Holders**” means Investors that hold at least a majority of the RegistrableSecurities.               bb. “**Rule 415**” means Rule 415 promulgated under the 1933 Act or any successor rule providingfor offering securities on a continuous or delayed basis.               cc. “**SEC**” means the United States Securities and Exchange Commission.          2. Registration.               a. Mandatory Registration. The Company shall prepare, and, as soon as practicable butin no event later than the Initial Filing Deadline, file with the SEC the Initial RegistrationStatement on Form S-3 covering the resale of at least the number of shares of Common Stock equal tothe Initial Required Registration Amount determined as of date the Registration Statement isinitially filed with the SEC. In the event that Form S-3 is unavailable for such a registration,the Company shall use such other form as is available for such a registration on anotherappropriate form reasonably acceptable to the Required Holders, subject to the provisions ofSection 2(e). The Initial Registration Statement prepared pursuant hereto shall register forresale at least that number of shares of Common Stock equal to the Initial Required RegistrationAmount determined as of the date such Initial Registration Statement is initially filed with theSEC. The Initial Registration Statement shall contain (except if otherwise directed by theRequired Holders) the “Selling Stockholders” and “Plan of Distribution” sectionsfor the Investors in substantially the form attached hereto as Exhibit B. The Companyshall use its best efforts to have the Initial Registration Statement declared effective by the SECas soon as practicable, but in no event later than the Initial Effectiveness Deadline. By 9:30 amon the Business Day following the Initial Effective Date, the Company shall file with the SEC inaccordance with Rule 424 under the 1933 Act the final prospectus to be used in connection withsales pursuant to such Initial Registration Statement.               b. The Company shall prepare, and, as soon as practicable but in no event later than theAdditional Filing Deadline, file with the SEC an Additional Registration Statement on Form S-3covering the resale of all of the Additional Registrable Securities not previously registered on anAdditional Registration Statement hereunder. To the extent the staff of the SEC does not permitthe Additional Required Registration Amount to be registered on an Additional RegistrationStatement, the Company shall file Additional Registration Statements successively trying toregister on each such Additional Registration Statement the maximum number of remaining AdditionalRegistrable Securities until the Additional Required Registration Amount has been registered withthe SEC. In the event that Form S-3 is unavailable for such a registration, the Company shall usesuch other form as is available for such a registration on another appropriate form reasonably acceptable to the Required Holders,subject to the provisions of Section 2(e). Each Additional Registration Statement preparedpursuant
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hereto shall register for resale at least that number of shares of Common Stock equal tothe Additional Required Registration Amount determined as of the date such Additional RegistrationStatement is initially filed with the SEC. Each Additional Registration Statement shall contain(except if otherwise directed by the Required Holders) the “Selling Stockholders” and“Plan of Distribution” sections in substantially the form attached hereto as ExhibitB. The Company shall use its best efforts to have each Additional Registration Statementdeclared effective by the SEC as soon as practicable, but in no event later than the AdditionalEffectiveness Deadline. By 9:30 am on the Business Day following the Additional Effective Date,the Company shall file with the SEC in accordance with Rule 424 under the 1933 Act the finalprospectus to be used in connection with sales pursuant to such Additional Registration Statement.               c. Allocation of Registrable Securities. The initial number of Registrable Securitiesincluded in any Registration Statement and any increase or decrease in the number of RegistrableSecurities included therein shall be allocated pro rata among the Investors based on the number ofRegistrable Securities held by each Investor at the time the Registration Statement covering suchinitial number of Registrable Securities or increase or decrease thereof is declared effective bythe SEC. In the event that an Investor sells or otherwise transfers any of such Investor’sRegistrable Securities, each transferee shall be allocated a pro rata portion of the then remainingnumber of Registrable Securities included in such Registration Statement for such transferor. Anyshares of Common Stock included in a Registration Statement and which remain allocated to anyPerson which ceases to hold any Registrable Securities covered by such Registration Statement shallbe allocated to the remaining Investors, pro rata based on the number of Registrable Securitiesthen held by such Investors which are covered by such Registration Statement. In no event shallthe Company include any securities other than Registrable Securities on any Registration Statementwithout the prior written consent of the Required Holders.               d. Legal Counsel. Subject to Section 5 hereof, the Required Holders shall have theright to select one legal counsel to review and oversee any registration pursuant to this Section 2(“**Legal Counsel**”), which shall be Schulte Roth & Zabel LLP or such other counsel as thereafterdesignated by the Required Holders with the consent of the Company, which consent shall not beunreasonably withheld or delayed. The Company and Legal Counsel shall reasonably cooperate witheach other in performing the Company’s obligations under this Agreement.               e. Ineligibility for Form S-3. In the event that Form S-3 is not available for theregistration of the resale of Registrable Securities hereunder, the Company shall (i) register theresale of the Registrable Securities on another appropriate form reasonably acceptable to theRequired Holders and (ii) undertake to register the Registrable Securities on Form S-3 as soon assuch form is available, provided that the Company shall maintain the effectiveness of theRegistration Statement then in effect until such time as a Registration Statement on Form S-3covering the Registrable Securities has been declared effective by the SEC.               f. Sufficient Number of Shares Registered. In the event the number of sharesavailable under a Registration Statement filed pursuant to Section 2(a) or 2(b) is insufficient tocover all of the Registrable Securities required to be covered by such Registration
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Statement or an Investor’s allocated portion of the Registrable Securities pursuant to Section 2(b), the Companyshall amend the applicable Registration Statement, or file a new Registration Statement (on theshort form available therefor, if applicable), or both, so as to cover at least the RequiredRegistration Amount as of the Trading Day immediately preceding the date of the filing of suchamendment or new Registration Statement, in each case, as soon as practicable, but in any event notlater than fifteen (15) days after the necessity therefor arises. The Company shall use itsreasonable best efforts to cause such amendment and/or new Registration Statement to becomeeffective as soon as practicable following the filing thereof. For purposes of the foregoingprovision, the number of shares available under a Registration Statement shall be deemed“insufficient to cover all of the Registrable Securities” if at any time the number of shares ofCommon Stock available for resale under the Registration Statement is less than the productdetermined by multiplying (i) the Required Registration Amount as of such time by (ii) 0.90. Thecalculation set forth in the foregoing sentence shall be made without regard to any limitations onthe conversion of the Notes and such calculation shall assume that the Notes are then convertibleinto shares of Common Stock at the then prevailing Conversion Rate (as defined in the Notes).               g. Effect of Failure to File and Obtain and Maintain Effectiveness of RegistrationStatement. If (i) a Registration Statement covering all of the Registrable Securities requiredto be covered thereby and required to be filed by the Company pursuant to this Agreement is (A) notfiled with the SEC on or before the respective Filing Deadline (a “**Filing Failure**”) or (B) notdeclared effective by the SEC on or before the Effectiveness Deadline (an “**Effectiveness Failure**”)or (ii) on any day after the Effective Date sales of all of the Registrable Securities required tobe included on such Registration Statement cannot be made (other than during an Allowable GracePeriod (as defined in Section 3(r)) pursuant to such Registration Statement (including, withoutlimitation, because of a failure to keep such Registration Statement effective, to disclose suchinformation as is necessary for sales to be made pursuant to such Registration Statement or toregister a sufficient number of shares of Common Stock) (a “**Maintenance Failure**”) then, as partialrelief for the damages to any Investor by reason of any such delay in or reduction of its abilityto sell the underlying shares of Common Stock (which remedy shall not be exclusive of any otherremedies available at law or in equity), the Company shall pay to each Investor relating to suchRegistration Statement an amount in cash equal to (A) one and one-half percent (1.5%) of theaggregate Purchase Price (as such term is defined in the Securities Purchase Agreement) of suchInvestor’s Registrable Securities included in such Registration Statement on each of the followingdates: (i) the day of a Filing Failure and on every thirtieth day (pro rated for periods totalingless than thirty (30) days) thereafter until the date such Filing Failure is cured; (ii) the day ofan Effectiveness Failure and on every thirtieth day (pro rated for periods totaling less thanthirty (30) days) thereafter until the date such Effectiveness Failure is cured; and (iii) theinitial day of a Maintenance Failure and on every thirtieth day (pro rated for periods totalingless than thirty (30) days) thereafter until the date such Maintenance Failure is cured. Thepayments to which an Investor shall be entitled pursuant to this Section 2(f) are referred toherein as “**Registration Delay Payments**.” Registration Delay Payments shall be paid on the earlierof (I) the last day of the calendar month during which such Registration Delay Payments areincurred and (II) the third Business Day after the event orfailure giving rise to the Registration Delay Payments is cured. In the event the Companyfails to make Registration Delay Payments in a timely manner, such Registration Delay Paymentsshall
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bear interest at the rate of one and one-half percent (1.5%) per month (prorated for partialmonths) until paid in full.               h. Neither the Company nor any Subsidiary (as defined in the Securities Purchase Agreement)nor affiliate thereof shall identify any Buyer as an underwriter in any public disclosure or filingwith the SEC or any Principal Market (as defined in the Securities Purchase Agreement) or anyTrading Market (as defined in the Securities Purchase Agreement) and any Buyer being deemed anunderwriter by the SEC shall not relieve the Company of any obligations it has under this Agreementor any other Transaction Document (as defined in the Securities Purchase Agreement) provided,however, that the foregoing shall not prohibit the Company from including the disclosure found inthe “Plan of Distribution” section attached hereto as Exhibit B in the Registration Statement.          3. Related Obligations.          At such time as the Company is obligated to file a Registration Statement with the SECpursuant to Section 2(a), 2(b), 2(e) or 2(f), the Company will use its reasonable best efforts toeffect the registration of the Registrable Securities in accordance with the intended method ofdisposition thereof and, pursuant thereto, the Company shall have the following obligations:               a. The Company shall submit to the SEC, within two (2) Business Days after the Company learnsthat no review of a particular Registration Statement will be made by the staff of the SEC or thatthe staff has no further comments on a particular Registration Statement, as the case may be, arequest for acceleration of effectiveness of such Registration Statement to a time and date notlater than 48 hours after the submission of such request. The Company shall keep each RegistrationStatement effective pursuant to Rule 415 at all times until the earlier of (i) the date as of whichthe Investors may sell all of the Registrable Securities covered by such Registration Statementwithout restriction pursuant to Rule 144(k) (or any successor thereto) promulgated under the 1933Act or (ii) the date on which the Investors shall have sold all of the Registrable Securitiescovered by such Registration Statement (the “**Registration Period**”). The Company shall ensure thateach Registration Statement (including any amendments or supplements thereto and prospectusescontained therein) shall not contain any untrue statement of a material fact or omit to state amaterial fact required to be stated therein, or necessary to make the statements therein (in thecase of prospectuses, in the light of the circumstances in which they were made) not misleading.               b. The Company shall prepare and file with the SEC such amendments (including post-effectiveamendments) and supplements to a Registration Statement and the prospectus used in connection withsuch Registration Statement, which prospectus is to be filed pursuant to Rule 424 promulgated underthe 1933 Act, as may be necessary to keep such Registration Statement effective at all times duringthe Registration Period, and, during such period, comply with the provisions of the 1933 Act withrespect to the disposition of all Registrable Securities of the Company covered by suchRegistration Statement until such time as all of such Registrable Securities shall have beendisposed of in accordance with the intended methods of disposition by the seller or sellers thereofas set forth in such Registration Statement.In the case of amendments and supplements to a Registration Statement which are required to befiled pursuant to this Agreement (including pursuant to this Section 3(b)) by reason of the
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Company filing a report on Form 10-Q, Form 10-K or any analogous report under the Securities Exchange Actof 1934, as amended (the “**1934 Act**”), the Company shall have incorporated such report by referenceinto such Registration Statement, if applicable, or shall file such amendments or supplements withthe SEC on the same day on which the 1934 Act report is filed which created the requirement for theCompany to amend or supplement such Registration Statement.               c. The Company shall (A) permit Legal Counsel to review and comment upon (i) a RegistrationStatement at least five (5) Business Days prior to its filing with the SEC and (ii) all amendmentsand supplements to all Registration Statements (except for Annual Reports on Form 10-K and Reportson Form 10-Q and any similar or successor reports) within a reasonable number of days prior totheir filing with the SEC, and (B) not file any Registration Statement or amendment or supplementthereto in a form to which Legal Counsel reasonably and timely objects. The Company shall notsubmit a request for acceleration of the effectiveness of a Registration Statement or any amendmentor supplement thereto without the prior approval of Legal Counsel, which consent shall not beunreasonably withheld or delayed. The Company shall furnish to Legal Counsel, without charge, (i)copies of any correspondence from the SEC or the staff of the SEC to the Company or itsrepresentatives relating to any Registration Statement, (ii) promptly after the same is preparedand filed with the SEC, one copy of any Registration Statement and any amendment(s) thereto,including financial statements and schedules, all documents incorporated therein by reference, ifrequested by an Investor, and all exhibits (unless such Registration Statement is available onEDGAR) and (iii) upon the effectiveness of any Registration Statement, one copy of the prospectusincluded in such Registration Statement and all amendments and supplements thereto. The Companyshall reasonably cooperate with Legal Counsel in performing the Company’s obligations pursuant tothis Section 3.               d. The Company shall furnish to each Investor whose Registrable Securities are included in anyRegistration Statement, without charge, (i) promptly after the same is prepared and filed with theSEC, at least one copy of such Registration Statement and any amendment(s) thereto, includingfinancial statements and schedules, all documents incorporated therein by reference, if requestedby an Investor, all exhibits and each preliminary prospectus (unless such Registration Statement isavailable on EDGAR), (ii) upon the effectiveness of any Registration Statement, ten (10) copies ofthe prospectus included in such Registration Statement and all amendments and supplements thereto(unless such amendments and supplements are available on EDGAR) and (iii) such other documents,including copies of the foregoing (regardless of whether such documents are available upon EDGAR)and any preliminary or final prospectus, as such Investor may reasonably request from time to timein order to facilitate the disposition of the Registrable Securities owned by such Investor.               e. The Company shall use its reasonable best efforts to (i) register and qualify, unless anexemption from registration and qualification applies, the resale by Investors of the RegistrableSecurities covered by a Registration Statement under such other securities or “blue sky” laws ofall applicable jurisdictions in the United States, (ii) prepare and file in those jurisdictions,such amendments (including post-effective amendments) and supplements to such registrations andqualifications as may be necessary to maintain the effectiveness thereof during the RegistrationPeriod, (iii) take such other actions as may be reasonably necessary to maintainsuch registrations and qualifications in effect at all times during the Registration Period,and (iv) take all other actions reasonably necessary or advisable to qualify the RegistrableSecurities for
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sale in such jurisdictions; provided, however, that the Companyshall not be required in connection therewith or as a condition thereto to (x) qualify to dobusiness in any jurisdiction where it would not otherwise be required to qualify but for thisSection 3(e), (y) subject itself to general taxation in any such jurisdiction, or (z) file ageneral consent to service of process in any such jurisdiction. The Company shall promptly notifyLegal Counsel and each Investor who holds Registrable Securities of the receipt by the Company ofany notification with respect to the suspension of the registration or qualification of any of theRegistrable Securities for sale under the securities or “blue sky” laws of any jurisdiction in theUnited States or its receipt of notice of the initiation or threatening of any proceeding for suchpurpose.               f. The Company shall notify Legal Counsel and each Investor in writing of the happening of anyevent, as promptly as practicable after becoming aware of such event, as a result of which theprospectus included in a Registration Statement, as then in effect, includes an untrue statement ofa material fact or omission to state a material fact required to be stated therein or necessary tomake the statements therein, in the light of the circumstances under which they were made, notmisleading (provided that in no event shall such notice contain any material, nonpublicinformation), and, subject to Section 3(r), promptly prepare a supplement or amendment to suchRegistration Statement to correct such untrue statement or omission, and deliver ten (10) copies ofsuch supplement or amendment to Legal Counsel and each Investor (or such other number of copies asLegal Counsel or such Investor may reasonably request) (unless such supplements or amendments areavailable on EDGAR). The Company shall also promptly notify Legal Counsel and each Investor inwriting (i) when a prospectus or any prospectus supplement or post-effective amendment has beenfiled, and when a Registration Statement or any post-effective amendment has become effective(notification of such effectiveness shall be delivered to Legal Counsel and each Investor byfacsimile no later than the next Business Day of such effectiveness and by overnight mail), (ii) ofany request by the SEC for amendments or supplements to a Registration Statement or relatedprospectus or related information, and (iii) of the Company’s reasonable determination that apost-effective amendment to a Registration Statement would be appropriate.               g. The Company shall use its reasonable best efforts to prevent the issuance of any stop orderor other suspension of effectiveness of a Registration Statement, or the suspension of thequalification of any of the Registrable Securities for sale in any jurisdiction and, if such anorder or suspension is issued, to obtain the withdrawal of such order or suspension at the earliestpossible moment and to notify Legal Counsel and each Investor who holds Registrable Securitiesbeing sold of the issuance of such order and the resolution thereof or its receipt of notice of theinitiation or threat of any proceeding for such purpose.               h. If any Investor is required under applicable securities law to be described in theRegistration Statement as an underwriter, at the reasonable request of such Investor, the Companyshall furnish to such Investor, on the date of the effectiveness of the Registration Statement andthereafter from time to time on such dates as an Investor may reasonably request (i) a letter,dated such date, from the Company’s independent certified public accountants in form and substanceas is customarily given by independent certified public accountants to underwriters in anunderwritten public offering, addressed to the Investors, and (ii) an opinion, dated as of such date, of counsel representing the Company for purposes ofsuch
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Registration Statement, in form, scope and substance as is customarily given in anunderwritten public offering, addressed to the Investors.               i. If, after the execution of this Agreement, an Investor believes that it could reasonably bedeemed to be an underwriter of Registrable Securities, upon the request of such Investor, theCompany shall make available for inspection by (i) any Investor, (ii) Legal Counsel and (iii) onefirm of accountants or other agents retained by the Investors (collectively, the “**Inspectors**”), allpertinent financial and other records, and pertinent corporate documents and properties of theCompany (collectively, the “**Records**”), as shall be reasonably deemed necessary by each Inspector,and cause the Company’s officers, directors and employees to supply all information which anyInspector may reasonably request; provided, however, that each Inspector shall agree to hold instrict confidence and shall not make any disclosure (except to an Investor) or use of any Record orother information which the Company determines in good faith to be confidential, and of whichdetermination the Inspectors are so notified, unless (a) the disclosure of such Records isnecessary to avoid or correct a misstatement or omission in any Registration Statement or isotherwise required under the 1933 Act, (b) the release of such Records is ordered pursuant to afinal, non-appealable subpoena or order from a court or government body of competent jurisdiction,or (c) the information in such Records has been made generally available to the public other thanby disclosure in violation of this or any other Transaction Document. Each Investor agrees that itshall, upon learning that disclosure of such Records is sought in or by a court or governmentalbody of competent jurisdiction or through other means, give prompt notice to the Company and allowthe Company, at its expense, to undertake appropriate action to prevent disclosure of, or to obtaina protective order for, the Records deemed confidential. Nothing herein (or in any otherconfidentiality agreement between the Company and any Investor) shall be deemed to limit theInvestors’ ability to sell Registrable Securities in a manner which is otherwise consistent withapplicable laws and regulations.               j. The Company shall hold in confidence and not make any disclosure of information concerningan Investor provided to the Company unless (i) disclosure of such information is necessary tocomply with federal or state securities laws, (ii) the disclosure of such information is necessaryto avoid or correct a misstatement or omission in any Registration Statement, (iii) the release ofsuch information is ordered pursuant to a subpoena or other final, non-appealable order from acourt or governmental body of competent jurisdiction or (iv) such information has been madegenerally available to the public other than by disclosure in violation of this Agreement, anyother agreement to which the Company is a party, or, to the Company’s knowledge, any otheragreement. The Company agrees that it shall, upon learning that disclosure of such informationconcerning an Investor is sought in or by a court or governmental body of competent jurisdiction orthrough other means, give prompt written notice to such Investor and allow such Investor, at theInvestor’s expense, to undertake appropriate action to prevent disclosure of, or to obtain aprotective order for, such information.               k. The Company shall use its reasonable best efforts either to (i) cause all of theRegistrable Securities covered by a Registration Statement to be listed on each securities exchangeon which securities of the same class or series issued by the Company are then listed, if any, ifthe listing of such Registrable Securities is then permitted under the rules of such exchange, or(ii) secure designation and quotation of all of the Registrable Securities covered bya Registration Statement on The American Stock Exchange or (iii) if, despite the Company’s
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reasonable best efforts to satisfy, the preceding clauses (i) and (ii) the Company is unsuccessfulin satisfying the preceding clauses (i) and (ii), to secure the inclusion for quotation on the TheNew York Stock Exchange, The NASDAQ Global Market or The NASDAQ Capital Market the for suchRegistrable Securities and, without limiting the generality of the foregoing, to use its bestefforts to arrange for at least two market makers to register with the National Association ofSecurities Dealers, Inc. (“**NASD**”) as such with respect to such Registrable Securities. The Companyshall pay all fees and expenses in connection with satisfying its obligation under this Section3(k).               l. The Company shall cooperate with the Investors who hold Registrable Securities beingoffered and, to the extent applicable, facilitate the timely preparation and delivery ofcertificates (not bearing any restrictive legend) representing the Registrable Securities to beoffered pursuant to a Registration Statement and enable such certificates to be in suchdenominations or amounts, as the case may be, as the Investors may reasonably request andregistered in such names as the Investors may request.               m. If requested by an Investor, the Company shall (i) as soon as practicable incorporate in aprospectus supplement or post-effective amendment such information as an Investor reasonablyrequests to be included therein relating to the sale and distribution of Registrable Securities,including, without limitation, information with respect to the number of Registrable Securitiesbeing offered or sold, the purchase price being paid therefor and any other terms of the offeringof the Registrable Securities to be sold in such offering; (ii) as soon as practicable make allrequired filings of such prospectus supplement or post-effective amendment after being notified ofthe matters to be incorporated in such prospectus supplement or post-effective amendment; and (iii)as soon as practicable, supplement or make amendments to any Registration Statement if reasonablyrequested by an Investor holding any Registrable Securities.               n. The Company shall use its reasonable best efforts to cause the Registrable Securitiescovered by a Registration Statement to be registered with or approved by such other governmentalagencies or authorities as may be necessary to consummate the disposition of such RegistrableSecurities.               o. The Company shall make generally available to its security holders as soon as practical,but not later than ninety (90) days after the close of the period covered thereby, an earningsstatement (in form complying with, and in the manner provided by, the provisions of Rule 158 underthe 1933 Act) covering a twelve-month period beginning not later than the first day of theCompany’s fiscal quarter next following the effective date of a Registration Statement.               p. The Company shall otherwise use its reasonable best efforts to comply with all applicablerules and regulations of the SEC in connection with any registration hereunder.               q. Within two (2) Business Days after a Registration Statement which covers RegistrableSecurities is ordered effective by the SEC, the Company shall deliver, and shall cause legalcounsel for the Company (which may be the General Counsel of the Company)to deliver, to the transfer agent for such Registrable Securities (with copies to theInvestors
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whose Registrable Securities are included in such Registration Statement) confirmationthat such Registration Statement has been declared effective by the SEC in the form attached heretoas Exhibit A.               r. Notwithstanding anything to the contrary herein, at any time after the Effective Date, theCompany may delay the disclosure of material, non-public information concerning the Company thedisclosure of which at the time is not, in the good faith opinion of the Board of Directors of theCompany, in the best interest of the Company otherwise required (a “**Grace Period**”); provided, thatthe Company shall promptly (i) notify the Investors in writing of the existence of material,non-public information giving rise to a Grace Period (provided that in each notice the Company willnot disclose the content of such material, non-public information to the Investors) and the date onwhich the Grace Period will begin, and (ii) notify the Investors in writing of the date on whichthe Grace Period ends; and, provided further, that no Grace Period shall exceed five (5)consecutive days and during any three hundred sixty five (365) day period such Grace Periods shallnot exceed an aggregate of twenty (20) days and the first day of any Grace Period must be at leastfive (5) Trading Days after the last day of any prior Grace Period (each, an “**Allowable GracePeriod**”). For purposes of determining the length of a Grace Period above, the Grace Period shallbegin on and include the date the Investors receive the notice referred to in clause (i) and shallend on and include the later of the date the Investors receive the notice referred to in clause(ii) and the date referred to in such notice. The provisions of Section 3(g) hereof shall not beapplicable during the period of any Allowable Grace Period. Upon expiration of the Grace Period,the Company shall again be bound by the first sentence of Section 3(f) with respect to theinformation giving rise thereto unless such material, non-public information is no longerapplicable. Notwithstanding anything to the contrary, the Company shall cause its transfer agentto deliver unlegended shares of Common Stock to a transferee of an Investor in accordance with theterms of the Securities Purchase Agreement in connection with any sale of Registrable Securitieswith respect to which an Investor has entered into a contract for sale, and delivered a copy of theprospectus included as part of the applicable Registration Statement (unless an exemption from suchprospectus delivery requirement exists), prior to the Investor’s receipt of the notice of a GracePeriod and for which the Investor has not yet settled.          4. Obligations of the Investors.               a. At least five (5) Business Days prior to the first anticipated filing date of aRegistration Statement, the Company shall notify each Investor in writing of the information theCompany requires from each such Investor if such Investor elects to have any of such Investor’sRegistrable Securities included in such Registration Statement. It shall be a condition precedentto the obligations of the Company to complete the registration pursuant to this Agreement withrespect to the Registrable Securities of a particular Investor that such Investor shall furnish tothe Company such information regarding itself, the Registrable Securities held by it and theintended method of disposition of the Registrable Securities held by it as shall be reasonablyrequired to effect the effectiveness of the registration of such Registrable Securities and shallexecute such documents in connection with such registration as the Company may reasonably request.               b. Each Investor, by such Investor’s acceptance of the Registrable Securities, agrees tocooperate with the Company as reasonably requested by the Company in
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connection with the preparation and filing of any Registration Statement hereunder, unless such Investor has notifiedthe Company in writing of such Investor’s election to exclude all of such Investor’s RegistrableSecurities from such Registration Statement.               c. Each Investor agrees that, upon receipt of any notice from the Company of the happening ofany event of the kind described in Section 3(g) or the first sentence of 3(f), such Investor willimmediately discontinue disposition of Registrable Securities pursuant to any RegistrationStatement(s) covering such Registrable Securities until such Investor’s receipt of the copies ofthe supplemented or amended prospectus contemplated by Section 3(g) or the first sentence of 3(f)or receipt of notice that no supplement or amendment is required. Notwithstanding anything to thecontrary, the Company shall cause its transfer agent to deliver unlegended shares of Common Stockto a transferee of an Investor in accordance with the terms of the Securities Purchase Agreement inconnection with any sale of Registrable Securities with respect to which an Investor has enteredinto a contract for sale prior to the Investor’s receipt of a notice from the Company of thehappening of any event of the kind described in Section 3(g) or the first sentence of 3(f) and forwhich the Investor has not yet settled.               d. Each Investor covenants and agrees that it will comply with the prospectus deliveryrequirements of the 1933 Act as applicable to it or an exemption therefrom in connection with salesof Registrable Securities pursuant to the Registration Statement.          5. Expenses of Registration.          All reasonable expenses, other than underwriting discounts and commissions incurred inconnection with registrations, filings or qualifications pursuant to Sections 2 and 3, including,without limitation, all registration, listing and qualifications fees, printers and accountingfees, and fees and disbursements of counsel for the Company, shall be paid by the Company. TheCompany shall also reimburse the Investors for the fees and disbursements of Legal Counsel inconnection with registration, filing or qualification pursuant to Sections 2 and 3 of thisAgreement which amount shall be limited to $10,000 for each such registration, filing orqualification.          6. Indemnification.          In the event any Registrable Securities are included in a Registration Statement under thisAgreement:               a. To the fullest extent permitted by law, the Company will, and hereby does, indemnify, holdharmless and defend each Investor, the directors, officers, members, partners, employees, agents,representatives of, and each Person, if any, who controls any Investor within the meaning of the1933 Act or the 1934 Act (each, an “**Indemnified Person**”), against any losses, claims, damages,liabilities, judgments, fines, penalties, charges, costs, reasonable attorneys’ fees, amounts paidin settlement or expenses, joint or several, (collectively, “**Claims**”) incurred in investigating,preparing or defending any action, claim, suit, inquiry, proceeding, investigation or appeal takenfrom the foregoing by or before any court or governmental, administrative or other regulatory agency, body or the SEC, whether pending orthreatened, whether or not an indemnified party is or may be a party thereto (“**Indemnified**
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**Damages**”), to which any of them may become subject insofar as such Claims (or actions orproceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon:(i) any untrue statement or alleged untrue statement of a material fact in a Registration Statementor any post-effective amendment thereto or in any filing made in connection with the qualificationof the offering under the securities or other “blue sky” laws of any jurisdiction in whichRegistrable Securities are offered (“**Blue Sky Filing**”), or the omission or alleged omission tostate a material fact required to be stated therein or necessary to make the statements therein notmisleading, (ii) any untrue statement or alleged untrue statement of a material fact contained inany preliminary prospectus if used prior to the effective date of such Registration Statement, orcontained in the final prospectus (as amended or supplemented, if the Company files any amendmentthereof or supplement thereto with the SEC) or the omission or alleged omission to state thereinany material fact necessary to make the statements made therein, in the light of the circumstancesunder which the statements therein were made, not misleading, (iii) any violation or allegedviolation by the Company of the 1933 Act, the 1934 Act, any other law, including, withoutlimitation, any state securities law, or any rule or regulation thereunder relating to the offer orsale of the Registrable Securities pursuant to a Registration Statement or (iv) any violation ofthis Agreement (the matters in the foregoing clauses (i) through (iv) being, collectively,“**Violations**”). Subject to Section 6(c), the Company shall reimburse the Indemnified Persons,promptly as such expenses are incurred and are due and payable, for any legal fees or otherreasonable expenses incurred by them in connection with investigating or defending any such Claim.Notwithstanding anything to the contrary contained herein, the indemnification agreement containedin this Section 6(a): (i) shall not apply to a Claim by an Indemnified Person arising out of orbased upon a Violation which occurs in reliance upon and in conformity with information furnishedin writing to the Company by such Indemnified Person for such Indemnified Person expressly for usein connection with the preparation of the Registration Statement or any such amendment thereof orsupplement thereto, if such prospectus was timely made available by the Company pursuant to Section3(d) and (ii) shall not apply to amounts paid in settlement of any Claim if such settlement iseffected without the prior written consent of the Company, which consent shall not be unreasonablywithheld or delayed. Such indemnity shall remain in full force and effect regardless of anyinvestigation made by or on behalf of the Indemnified Person and shall survive the transfer of theRegistrable Securities by the Investors pursuant to Section 9.               b. In connection with any Registration Statement in which an Investor is participating, eachsuch Investor agrees to severally and not jointly indemnify, hold harmless and defend, to the sameextent and in the same manner as is set forth in Section 6(a), the Company, each of its directors,each of its officers who signs the Registration Statement and each Person, if any, who controls theCompany within the meaning of the 1933 Act or the 1934 Act (each, an “**Indemnified Party**”), againstany Claim or Indemnified Damages to which any of them may become subject, under the 1933 Act, the1934 Act or otherwise, insofar as such Claim or Indemnified Damages arise out of or are based uponany Violation, in each case to the extent, and only to the extent, that such Violation occurs inreliance upon and in conformity with written information furnished to the Company by such Investorexpressly for use in connection with such Registration Statement; and, subject to Section 6(c),such Investor shall reimburse the Indemnified Party, promptly as such expenses are incurred and aredue and payable, for any legal fees or other reasonable expenses incurred by it in connection with investigating or defendingany such Claim; provided, however, that the indemnity agreement contained in this Section 6(b)
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and the agreement with respect to contribution contained in Section 7 shall not apply to amounts paidin settlement of any Claim if such settlement is effected without the prior written consent of suchInvestor, which consent shall not be unreasonably withheld or delayed; provided, further, however,that the Investor shall be liable under this Section 6(b) for only that amount of a Claim or Indemnified Damages as does not exceed the net proceeds to such Investor as a result of the sale ofRegistrable Securities pursuant to such Registration Statement. Such indemnity shall remain infull force and effect regardless of any investigation made by or on behalf of such IndemnifiedParty and shall survive the transfer of the Registrable Securities by the Investors pursuant toSection 9.               c. Promptly after receipt by an Indemnified Person or Indemnified Party under this Section 6of notice of the commencement of any action or proceeding (including any governmental action orproceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if a Claim inrespect thereof is to be made against any indemnifying party under this Section 6, deliver to theindemnifying party a written notice of the commencement thereof, and the indemnifying party shallhave the right to participate in, and, to the extent the indemnifying party so desires, jointlywith any other indemnifying party similarly noticed, to assume control of the defense thereof withcounsel mutually satisfactory to the indemnifying party and the Indemnified Person or theIndemnified Party, as the case may be; provided, however, that an IndemnifiedPerson or Indemnified Party shall have the right to retain its own counsel with the fees andexpenses of not more than one counsel for such Indemnified Person or Indemnified Party to be paidby the indemnifying party, if, in the reasonable opinion of counsel retained by the indemnifyingparty, the representation by such counsel of the Indemnified Person or Indemnified Party and theindemnifying party would be inappropriate due to actual or potential differing interests betweensuch Indemnified Person or Indemnified Party and any other party represented by such counsel insuch proceeding. In the case of an Indemnified Person, legal counsel referred to in theimmediately preceding sentence shall be selected by the Investors holding at least a majority ininterest of the Registrable Securities included in the Registration Statement to which the Claimrelates. The Indemnified Party or Indemnified Person shall cooperate fully with the indemnifyingparty in connection with any negotiation or defense of any such action or Claim by the indemnifyingparty and shall furnish to the indemnifying party all information reasonably available to theIndemnified Party or Indemnified Person which relates to such action or Claim. The indemnifyingparty shall keep the Indemnified Party or Indemnified Person reasonably apprised at all times as tothe status of the defense or any settlement negotiations with respect thereto. No indemnifyingparty shall be liable for any settlement of any action, claim or proceeding effected without itsprior written consent; provided, however, that the indemnifying party shall notunreasonably withhold, delay or condition its consent. No indemnifying party shall, without theprior written consent of the Indemnified Party or Indemnified Person, consent to entry of anyjudgment or enter into any settlement or other compromise which does not include as anunconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party orIndemnified Person of a release from all liability in respect to such Claim or litigation, and suchsettlement shall not include any admission as to fault on the part of the Indemnified Party.Following indemnification as provided for hereunder, the indemnifying party shall be subrogated toall rights of the Indemnified Party or Indemnified Person with respect to all third parties, firmsor corporations relating to the matter for which indemnification has been made. The failure to deliver written notice to the indemnifyingparty within a reasonable time of the commencement of any such action shall not relieve such
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indemnifying party of any liability to the Indemnified Person or Indemnified Party under thisSection 6, except to the extent that the indemnifying party is prejudiced in its ability to defendsuch action.               d. The indemnification required by this Section 6 shall be made by periodic payments of theamount thereof during the course of the investigation or defense, as and when bills are received orIndemnified Damages are incurred.               e. The indemnity agreements contained herein shall be in addition to (i) any cause of actionor similar right of the Indemnified Party or Indemnified Person against the indemnifying party orothers, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.          7. Contribution.          To the extent any indemnification by an indemnifying party is prohibited or limited by law,the indemnifying party agrees to make the maximum contribution with respect to any amounts forwhich it would otherwise be liable under Section 6 to the fullest extent permitted by law;provided, however, that: (i) no Person involved in the sale of RegistrableSecurities, which Person is guilty of fraudulent misrepresentation (within the meaning of Section11(f) of the 1933 Act) in connection with such sale, shall be entitled to contribution from anyPerson involved in such sale of Registrable Securities who was not guilty of fraudulentmisrepresentation; and (ii) contribution by any seller of Registrable Securities shall be limitedin amount to the amount of net proceeds received by such seller from the sale of such RegistrableSecurities pursuant to such Registration Statement.          8. Reports Under the 1934 Act.          With a view to making available to the Investors the benefits of Rule 144 promulgated underthe 1933 Act or any other similar rule or regulation of the SEC that may at any time permit theInvestors to sell securities of the Company to the public without registration (“**Rule 144**”), theCompany agrees to:               a. make and keep public information available, as those terms are understood and defined inRule 144;               b. file with the SEC in a timely manner all reports and other documents required of theCompany under the 1933 Act and the 1934 Act so long as the Company remains subject to suchrequirements and the filing of such reports and other documents is required for the applicableprovisions of Rule 144; and               c. furnish to each Investor so long as such Investor owns Registrable Securities, promptlyupon request, (i) a written statement by the Company, if true, that it has complied with thereporting requirements of Rule 144, the 1933 Act and the 1934 Act, (ii) a copy of the most recentannual or quarterly report of the Company and such other reports anddocuments so filed by the Company and (iii) such other information as may be reasonablyrequested to permit the Investors to sell such securities pursuant to Rule 144 withoutregistration.
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          9. Assignment of Registration Rights.          The rights under this Agreement shall be automatically assignable by the Investors to anytransferee of all or any portion of such Investor’s Registrable Securities if: (i) the Investoragrees in writing with the transferee or assignee to assign such rights and a copy of suchagreement is furnished to the Company within a reasonable time after such assignment; (ii) theCompany is, within a reasonable time after such transfer or assignment, furnished with writtennotice of (a) the name and address of such transferee or assignee and (b) the securities withrespect to which such registration rights are being transferred or assigned; (iii) immediatelyfollowing such transfer or assignment the further disposition of such securities by the transfereeor assignee is restricted under the 1933 Act or applicable state securities laws; (iv) at or beforethe time the Company receives the written notice contemplated by clause (ii) of this sentence thetransferee or assignee agrees in writing with the Company to be bound by all of the provisionscontained herein; and (v) such transfer shall have been made in accordance with the applicablerequirements of the Securities Purchase Agreement.          10. Amendment of Registration Rights.          Provisions of this Agreement may be amended and the observance thereof may be waived (eithergenerally or in a particular instance and either retroactively or prospectively), only with thewritten consent of the Company and the Required Holders. Any amendment or waiver effected inaccordance with this Section 10 shall be binding upon each Investor and the Company. No suchamendment shall be effective to the extent that it applies to less than all of the Investors. Noconsideration shall be offered or paid to any Person to amend or consent to a waiver ormodification of any provision of any of this Agreement unless the same consideration also isoffered to all of the parties to this Agreement.          11. Miscellaneous.               a. A Person is deemed to be a holder of Registrable Securities whenever such Person owns or isdeemed to own of record such Registrable Securities. If the Company receives conflictinginstructions, notices or elections from two or more Persons with respect to the same RegistrableSecurities, the Company shall act upon the basis of instructions, notice or election received fromthe such record owner of such Registrable Securities.               b. Any notices, consents, waivers or other communications required or permitted to be givenunder the terms of this Agreement must be in writing and will be deemed to have been delivered:(i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (providedconfirmation of transmission is mechanically or electronically generated and kept on file by thesending party); or (iii) one (1) Business Day after deposit with a nationally recognized overnightdelivery service, in each case properly addressed to the party to receive the same. The addressesand facsimile numbers for such communications shall be:     If to the Company:                    US Dataworks, Inc.
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                    One Sugar Creek Center Boulevard