fonixs8ex4n.htm


    
      

      

    

    

      FONIX
CORPORATION

       

      EMPLOYEE
STOCK GRANT AGREEMENT

       

      August
21, 2008

       

      


      WHEREAS,
the Board of Directors of Fonix Corporation, a Delaware corporation (the “
Company ”), has determined that the grant of shares of the Company’s Series A
Common Stock to John W. Shepherd (the “Employee”) in recognition and
appreciation of services previously performed by the Employee on behalf of the
Company is an effective means to align management interest with stockholder
interests;

       

      WHEREAS,
the continued participation of the Employee is considered by the Company to be
valuable to the Company’s growth; and

       

      WHEREAS,
the Company is willing to grant, and the Employee named below is willing to
accept, shares of the Company’s authorized Common Stock, par value $0.0001 per
share, according to the terms and conditions contained herein.

       

      1.      NOTICE
OF GRANT OF STOCK

       

      Name:
John W. Shepherd

       

      You have
been granted shares of Class A Common Stock of the Company, subject to the terms
and conditions of this Agreement:

       

      Date of
Grant                                                           August
21, 2008

       

      Total
Number of Shares of
Stock                             36,036,038

       

      2.      AGREEMENT

       

      (a)         Issuance of
Shares.  By signing below, the Employee hereby accepts from the
Company, and in recognition and appreciation of but not as compensation for past
services to the Company, the Company hereby issues to the Employee an aggregate
of 36,036,038 shares of Common Stock (the “Shares”).  The
Company will, promptly after execution of this Agreement, issue a certificate
representing the Shares registered in the name of the Employee or as directed by
the Employee.  Alternatively, upon request by the Employee, the
Company will work with its transfer agent to have the Shares delivered
electronically to a brokerage account of the Employee.  In return, the
Employee will deliver to the Company an executed counterpart of this
Agreement.

       

      (b)         Vesting .  All of
the Shares shall be fully vested upon issuance to the Employee.

       


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      3.      Definitions .  As
used herein, the following definitions will apply:

       

      (a)         “Board” means the
Board of Directors of the Company or any committee of an individual or
individuals that has been designated by the Board to administer this
Agreement.

       

      (b)         “Common Stock ” means
the Class A Common Stock of the Company, par value $0.0001 per
share.

       

      (c)         “Securities Act” means
the Securities Act of 1933, as amended.

       

      4.      Withholding of
Taxes.  By signing below, the Employee acknowledges that the
issuance of the Shares may constitute compensation or have other taxable
consequences to the Employee, and that grants will be treated as supplemental
wages and be added to the Employee’s W-2 Form.  The Company will be
responsible for payment of its portion of any applicable Social Security and
Medicare taxes relating to the Shares, and the Employee will be responsible for
payment of his or her portion.  The Employee acknowledges and agrees
that the Shares are subject to appropriate income tax withholding, and that the
Employee shall be responsible for any liability for any federal, state or local
income taxes required by law to be withheld with respect to such Shares (the
“Withholding Taxes”).

       

      5.      Tax
Consequences.   In addition to the acknowledgement above
in Section 4, the Employee represents and warrants that he or she has reviewed
with his or her own tax and financial advisors the federal, state, local, and
foreign tax consequences of this investment and the transactions contemplated by
this Agreement (including, without limitation, the withholding provisions of
Section 4 of this Agreement).   The Employee is relying
solely on such tax and financial advisors and not any statements or
representations of the Company or any agent of or legal, tax, or financial
advisor to the Company.   The Employee understands that he or she
(and not the Company) shall be responsible for the Employee’s own tax liability
that may arise as a result of this investment or the transactions contemplated
by this Agreement.

       

      6.      Additional
Actions.  The parties shall execute such further instruments
and take such further action as may reasonably be necessary to carry out the
intent of this Agreement.

       

      7.      Rights as
Shareholder.  The Employee shall be the record owner of the
Shares until or unless such Shares are sold or transferred, and as record owner
shall be entitled to all rights of a common stockholder of the Company,
including, without limitation, voting rights with respect to the Shares, and the
Employee shall receive, if and when paid, any dividends on all of the Shares
granted hereunder as to which the Employee is the record holder on the
applicable record date.

       

      8.      General
Provisions.

       

      (a)         This
Agreement will be governed by the internal substantive laws, but not the choice
of law rules of Utah.  This Agreement represents the entire agreement
between the parties with respect to the issuance of the Shares to the
Employee.

       

      (b)         Any
notice, demand or request required or permitted to be given by either the
Company or the Employee pursuant to the terms of this Agreement will be in
writing and will be deemed given when delivered personally or deposited in the
U.S.  mail, First Class with postage prepaid, and addressed to the
parties at the addresses of the parties set forth at the end of this Agreement
or such other address as a party may request by notifying the other in
writing.

       


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      (c)         The
rights of the Company under this Agreement will be transferable to any one or
more persons or entities, and all covenants and agreements hereunder will inure
to the benefit of, and be enforceable by the Company’s successors and
assigns.

       

      (d)         Either
party’s failure to enforce any provision of this Agreement will not in any way
be construed as a waiver of any such provision, nor prevent that party from
thereafter enforcing any other provision of this Agreement.  The
rights granted both parties hereunder are cumulative and will not constitute a
waiver of either party’s right to assert any other legal remedy available to
it.

       

      (e)         The
Employee agrees upon request to execute any further documents or instruments
necessary or desirable to carry out the purposes or intent of this
Agreement.

       

      (f)          THE
EMPLOYEE ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT AND THE TRANSACTIONS
CONTEMPLATED HEREUNDER DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF
CONTINUED ENGAGEMENT AS AN EMPLOYEE FOR ANY PERIOD OR AT ALL, AND SHALL NOT
INTERFERE WITH EMPLOYEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE EMPLOYEE’S
EMPLOYMENT WITH THE COMPANY AT ANY TIME, WITH OR WITHOUT CAUSE.

       

      9.      Entire
Agreement.  By the Employee’s signature below, the Employee
represents that he or she is familiar with the terms and provisions of this
Agreement and hereby accepts it subject to all of the terms and provisions
hereof.   The Employee has reviewed this Agreement in its
entirety, has had an opportunity to obtain the advice of counsel prior to
executing this Agreement, and fully understands all provisions of this
Agreement.  The Employee agrees to accept as binding, conclusive and
final all decisions or interpretations of the Board upon any questions arising
under this Agreement.  The Employee further agrees to notify the
Company upon any change in the residence indicated below.

       

      


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      IN
WITNESS WHEREOF, this Stock Grant Agreement is deemed made as of the date first
set forth above.

      
         

        
          
            
              
                	 
      	
                        FONIX
      CORPORATION

                      
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	
                        By: 
      ________________________________________

                      
	 
      	
                        Name:
      Roger D. Dudley

                      
	 
      	
                        Title:
      President

                      


              

               

              
 

              
                EMPLOYEE

                


                


                


                 

                ___________________________________________________


                


                


                
                  
                    
                       


                    

                    
                       


                      
                        

                      

                    

                    
                       


                    

                  

                

                 

                
                  APPENDIX
A

                  


                  Name: 
 _______________________________________________________________                                                                                               

                  


                  Address:       
___________________________________________________________

                         
___________________________________________________________

                         
___________________________________________________________

                                                    

                  Brokerage
Account Information:

                         
___________________________________________________________

                         
___________________________________________________________

                         
___________________________________________________________

                         
___________________________________________________________

                         
___________________________________________________________

                         
___________________________________________________________