PUT GRANTOR FEE AGREEMENT
Exhibit 10.5
This Agreement, made and entered into this 13th day of November, 2007, by and between US
Dataworks, Inc., a Nevada corporation (the “Company”) Xxxxxxx X. Xxxxx and Xxxx Xxxxxxxxx, each an
individual and undersigned to this Agreement (each referred to as a “Put Grantor” and collectively
as the “Put Grantors”).
WHEREAS, the Company and certain investors listed on the Schedule of Buyers, attached to that
certain Securities Purchase Agreement, dated October 31, 2007 (the “Securities Purchase
Agreement,” attached hereto as Exhibit A; such investors hereinafter referred to as
the “Buyers”) have entered into that certain Securities Purchase Agreement of even date
herewith pursuant to which Buyers will purchase a promissory note for Four Million Dollars
($4,000,000) (the “Note”) upon which interest shall accrue at the rate of approximately Ten Percent
(10%) per annum. A copy of the Note is attached hereto as Exhibit B;
WHEREAS, as a condition to the Buyers’ obligation to purchase the Note under the Securities
Purchase Agreement, Buyers require that the Put Agreement (the “Put Agreement”), substantially in
the form of Exhibit C attached hereto, be executed by the Put Grantors and delivered to
such Buyers;
WHEREAS, subject to the other terms and conditions herein contained, each of the Put Grantor
agrees to execute and deliver the Put Agreement in connection with the Securities Purchase
Agreement.
NOW THEREFORE
Section 1. Put Grantor Fee Amount. In consideration of the Put Grantors’ execution and
delivery of the Put Agreement, the Company agrees to pay a fee (hereinafter the “Put Grantor Fee”)
to be shared equally between the Put Grantors. The Put Grantor Fee shall be calculated as follows:
(i) two percent (2%) of the Note principal balance for the first six months of the Note’s term;
(ii) two percent (2%) of the Note principal balance for the next twelve months of the Note’s term;
and, (iii) two percent (2%) of the Note principal balance for the remaining eighteen months of the
Note’s term. The Put Grantor Fee shall accrue until that certain
date (the “Payment Date”) it
shall become due and payable, the earliest of: (i) an occurrence of a Fundamental Transaction (as
defined in the Securities Purchase Agreement) involving the Company; (ii) the demand for payment is
made by the Buyers, in accordance with the terms of the Note; or, (iii) the Note’s maturity date.
On the Payment Date the Company shall pay the Put Grantor the Put Grantor Fee in cash. This
section nothwithstanding,the Put Grantor Fee may only be paid after the complete repayment of the
Note in accordance with its terms.
Section 2. Duty to Satisfy the Note; Indemnity. The Company hereby irrevocably and
unconditionally agrees and undertakes to (i) take any action that is commercially reasonable so as
(a) to satisfy the terms and conditions of the Note and to avoid any breach therein, and (b) avoid
the occurrence of any Material Adverse Effect upon the Company which would cause the
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Buyers to accrue the right to pursue the remedies available under the Put Agreement; and, (ii)
indemnify and hold harmless the Put Grantor against and from all costs, losses, damages, actions,
proceedings, claims, demands, liabilities, charges and expenses of whatsoever nature and howsoever
arising (hereinafter, “Claims”) that the Put Grantor may incur, suffer or sustain or have imposed
on the Put Grantor by reason of, arising in any way out of or in relation to the Note or the Put
Agreement, but excluding any Claims resulting from either or both Put Grantors gross negligence or
willful misconduct and shall pay to the Put Grantor immediately upon first demand of the Put
Grantor such sum(s) as the Put Grantor certifies to have paid to arising from Put
Grantor’s litigation hereunder with proof of payment (any such certificate being conclusive and
binding on the parties hereto). The Company shall provide the Put Grantor with written
notification of any potential breach or default under the Note or any other event or action that
may result in such Put Grantor seeking indemnification under this Section 2.
Section 3. Consent to Jurisdiction and Service Of Process. The Company consents to the
jurisdiction of any court of the State of Texas (for Xx. Xxxxx) or California (for Xx. Xxxxxxxxx)
and of any federal court located in the State of Texas (for Xx. Xxxxx) or California (for Xx.
Xxxxxxxxx). The Company waives personal service of any summons, complaint or other process in
connection with any such action or proceeding and agrees that service thereof may be made, as the
Put Grantor may elect, by certified mail directed to the Company at the address provided in the
space below, or, in the alternative, in any other form or manner permitted by law.
Section 4. Governing Law. THIS PUT GRANTOR FEE AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEVADA APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED ENTIRELY THEREIN, WITHOUT GIVING EFFECT TO THE RULES OF
CONFLICTS OF LAW.
Section 5. Conformity With Law. All agreements between the Put Grantor and Company are
hereby expressly limited so that in no contingency or event whatsoever, whether by reason of
deferment or acceleration of the maturity of this Put Fee Agreement or otherwise, shall the rate of
interest hereunder exceed the maximum rate permissible under applicable law. If, from any
circumstances whatsoever, the rate of interest resulting from the payment and/or accrual of any
amount of interest hereunder, at any time that payment of interest is due and/or at any time that
interest is accrued, shall exceed the limits prescribed by such applicable law, then payment and/or
accrual of such interest shall be reduced to that resulting from the maximum rate of interest
permissible under such applicable law. This provision shall never be superseded or waived.
Section 6. Severability. Every provision hereof is intended to be several. If any
provision of this Put Fee Agreement is determined by a court of competent jurisdiction to be
illegal, invalid or unenforceable, such illegality, invalidity or unenforceability shall not affect
the other provisions hereof, which shall remain binding and enforceable.
Section 7. Waiver; Amendment. The Company hereby waives presentment, demand, protest and
notices of protest, demand, dishonor and nonpayment. Any provision of this Put Fee
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Agreement may be amended, waived or modified only upon the written consent of the parties hereto.
Section 8. Successors and Assigns. All the terms and provisions of this Put Fee Agreement
shall be binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
Section 9. Assignability. The Company’s obligations hereunder are nontransferable and
nonassignable without the prior written consent of Put Grantor.
Section 10. Entire Agreement. This Put Fee Agreement and the Put Agreement (as well as
Securities Purchase Agreement and any other Documents attached thereto or described therein)
represent the entire agreement between the parties relating to the subject matter hereof. This
Agreement alone fully and completely expresses the agreement of the parties relating to the subject
matter hereof. There are no other courses of dealing, understandings, agreements, representations
or warranties, written or oral, except as set forth herein.
Section 11. Facsimile Execution. Any signature delivered by facsimile transmission shall
create a valid and binding obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile signature page were an original
thereof.
Section 12. Legal Representation. Company and Put Grantor, respectively, agree and
represent that each party has been represented by such party’s legal counsel with regard to all
aspects of this Put Fee Agreement, or if such party is acting without legal counsel, that such
party has had adequate opportunity and has been encouraged to seek the advice of such party’s legal
counsel prior to the execution of this Put Fee Agreement.
IN WITNESS WHEREOF, the undersigneds have caused this Put Fee Agreement to be duly executed by
their respective authorized signatories as of the date first indicated above.
PUT GRANTOR
|
US DATAWORKS, INC. | |||
/s/ Xxxxxxx X. Xxxxx
|
/s/ Xxxx X. XxXxxxxxxx | |||
Xxxxxxx X. Xxxxx
|
Its authorized representative | |||
| Xxxx X. XxXxxxxxxx | ||||
Address for Notice |
Title: Chief Accounting Officer |
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/s/ Xxxx Xxxxxxxxx, M.D.
|
Address for Notice: | |||
Xxxx Xxxxxxxxx, M.D. |
||||
| 0 Xxxxx Xxxxx Xxxxxxxx Xxxxxx Xxxx. | ||||
| Fifth Floor | ||||
| Sugar Land, Texas 77478 | ||||
| Attn: General Counsel | ||||
| Tel.: (000) 000 0000 |
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