ADDENDUM TO AGREEMENT AND PLAN OF MERGER
THIS ADDENDUM dated the 29th day of October 1998, is entered
into by and among FONIX CORPORATION, a Delaware corporation
("fonix"), Papyrus Acquisition Corporation, a Utah corporation
("PAC") and Papyrus Development Corporation, a Massachusetts
corporation ("PDC").
RECITALS:
A. The parties entered into that certain Agreement and
Plan of Merger on September 10, 1998 (the "Agreement"); and
B. The parties have set October 29, 1998 as the Closing
Date under the Agreement and desire to modify certain of the
provisions of the Agreement to facilitate the Closing.
NOW, THEREFORE, in consideration of the mutual covenants and
conditions contained herein, the parties agree to modify the
Agreement as follows:
1. Delivery of Promissory Notes. Article II of the
Agreement is hereby modified and amended to reflect
the mutual agreement and understanding of the
parties as to the payment of the "Cash Payment"
referred to in the Agreement. As hereby amended and
modified, PAC and fonix will satisfy the requirement
of the Cash Payment by the delivery of promissory
notes in the aggregate principal amount of
$1,170,000 as follows: $490,000 due the earlier of
five business days following the closing of the next
equity funding completed by fonix, but not later
than February 28, 1999; $340,000 due on February 28,
1999; and $340,000 due on September 30, 1999. Each
stockholder of PDC will receive his pro rata share
of such notes as indicated.
2. Delivery of Shares. fonix and PAC acknowledge that
two of PDC's stockholders, Xxxxxxx X. Xxxxx and
Xxxxx Xxxxxxxxxxx, have entered into agreements
which will require, among other things, an
assignment of certain of the Merger Shares to two
individuals. The parties agree that these
assignments, the details of which have been
disclosed to fonix and PAC may proceed,
notwithstanding the restrictions against transfer in
the Agreement, and that the individual transferees
will take such Merger Shares with the same rights,
including registration rights, as granted to the
Papyrus Stockholders under the Agreement, and
subject to the same limitations, including
restrictions on transfer, as those binding upon the
Papyrus Stockholders under the Agreement.
3. Other Provisions. Except as necessary to conform
the remaining terms and conditions of the Agreement
to the change agreed upon in Paragraph 1, above, all
other terms, conditions and provisions of the
Agreement shall remain in full force and effect as
originally adopted.
DATED the day and year first written above.
FONIX CORPORATION
By /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx, President
Papyrus Development Corporation
By /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx, President
Papyrus Acquisition Corporation
By /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx, President