[Execution Version]
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made and entered
into as of August 18, 1998, by and between Kafus Environmental Industries Ltd.,
a British Columbia Corporation (the "Company"), and Enron Capital & Trade
Resources Corp., a Delaware corporation (the "Purchaser").
RECITALS
WHEREAS, the Company and the Purchaser are parties to a Letter Securities
Purchase Agreement dated as of August 18, 1998 (as modified from time to time,
the "Securities Purchase Agreement"), pursuant to which the Company shall issue
and sell to the Purchaser, and the Purchaser shall purchase from the Company a
convertible Note and certain Warrants as more particularly described therein.
WHEREAS, the Purchaser desires that the Company register the Common Stock
issuable upon conversion of the Note (the "Conversion Shares") and the Common
Stock issuable upon the exercise of the Warrants (the "Warrant Shares") upon the
terms and subject to the conditions set forth in this Agreement.
WHEREAS, the execution and delivery of this Agreement is a condition
precedent to the Purchaser's obligations under the Securities Purchase
Agreement.
NOW, THEREFORE, the parties hereto, intending legally to be bound, hereby
agree as follows:
1. DEFINITIONS.
As used in this Agreement, the following terms shall have the meanings
ascribed to them below:
(a) "Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control," when used with respect to any Person, means the power to direct the
management and policies of such Person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise, and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
(b) "Applicable Rate" shall mean 1.5% monthly with respect to the first
month and 2% monthly for each subsequent month, until the Registration Statement
shall become effective.
(c) "Business Day" means any Monday, Tuesday, Wednesday, Thursday, or
Friday that is not a day on which banking institutions in the City of New York,
New York, or Toronto, Ontario, are required by law, regulation or executive
order to close.
(d) "Holder" shall mean the Purchaser and any other Person who has become a
Permitted Transferee pursuant to Section 9(c).
(e) "Registrable Securities" means (a) any Common Stock issuable upon
conversion of the Note, (b) any Common Stock issuable upon exercise of any
Warrant, (c) all other shares of Common Stock purchased, acquired, or received
from any Person by the Purchaser and its Affiliates (or which they shall have
the right to purchase or acquire) pursuant to or in connection with the
transactions contemplated by the Securities Purchase Agreement and (d) any
securities issued or issuable in respect of or in exchange for any of the shares
of Common Stock referred to in clauses (a) through (c) above by way of a stock
dividend or stock split or in connection with a combination of shares,
recapitalization, reclassification, merger, consolidation, or exchange offer
("Distribution Securities"). For purposes of this Agreement, a Registrable
Security ceases to constitute a Registrable Security hereunder (i) when such
Registrable Security shall have been effectively registered under the Securities
Act and disposed of in a public market transaction pursuant to a Registration
Statement, (ii) when such Registrable Security shall have been sold pursuant to
Rule 144 (or any successor provision) under the Securities Act, (iii) when such
Registrable Security shall have been otherwise transferred and a new certificate
for such Registrable Security not bearing a legend restricting further transfer
shall have been delivered by the Company, (iv) with respect to a particular
Holder, at any time when all of such Holder's remaining Registrable Securities
can be sold in a single transaction in compliance with Rule 144 under the
Securities Act, (v) on the third anniversary of the original issuance date of
such Registrable Security, provided that the Holder of such Registerable
Security is not an Affiliate of the Company as of such date, and has not been an
Affiliate of the Company for a period of three months preceding such date, or
(vi) when such Registrable Security shall have ceased to be outstanding.
(f) "Registration Statement" shall have the meaning set forth in Section 2.
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(g) "Registration Termination Date" means, the first date on which all
Conversion Shares and all Warrant Shares (and any Distribution Securities with
respect thereto) cease to be Registrable Securities.
(h) "Securities Act" means the Securities Act of 1933, as amended.
(i) "Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(j) "SEC" means the United States Securities Exchange Commission, or any
successor agency thereto.
Other capitalized terms shall have the meanings ascribed to them in the
other sections of this Agreement or in the Securities Purchase Agreement if not
defined herein.
2. SHELF REGISTRATION.
(a) Effective Registration. On or before June 30, 1999 (the "Filing
Deadline"), the Company shall file with the SEC under the Securities Act a
Registration Statement on Form F-1 ("Registration Statement"), or on such other
registration form under the Securities Act as the Company shall deem
appropriate, covering the sale by the Holders on a continuous or delayed basis
pursuant to Rule 415 thereunder (or any similar rule that may be adopted by the
SEC) of (i) the Conversion Shares and (ii) the Warrant Shares. The Company shall
use its best efforts to cause each Registration Statement to be declared
effective on or prior to the one hundred and fiftieth (150th) day following the
Filing Deadline and shall thereafter keep such Registration Statement
continuously effective until the Registration Termination Date.
(b) Delay in Effectiveness. In the event any Registration Statement is not
declared effective by the SEC within 150 days after the Filing Deadline (the
"Effectiveness Deadline"), or in the event the effectiveness of any Registration
Statement is suspended or terminated at any time after its Effectiveness
Deadline and prior to the Registration Termination Date, then for each month (or
portion thereof) such Registration Statement is not so effective, the Company
shall pay to the Holders, as liquidated damages and not as a penalty, an amount
equal to the product of the face amount of the Note (being the maximum total
purchase price of the Securities, whether or not the full amount is advanced
under the Note) and the Applicable Rate. The Company shall pay such liquidated
damages to each Holder based upon the proportion of the Registerable Securities
owned by such Holder. Such payments shall be made on the first Business Day of
each month following any month
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in which such Registration Statement is not effective, with a final payment
within five (5) Business Days after such Registration Statement becomes
effective.
3. REGISTRATION PROCEDURES.
(a) Company Procedures. In connection with the Company's registration
obligations pursuant to Section 2, the Company shall keep each Registration
Statement continuously effective for the period of time provided in Section 2,
to permit the sale of Registrable Securities covered by such Registration
Statement in accordance with the intended method or methods of distribution
thereof specified in such Registration Statement or in the related
prospectus(es), and shall:
(i) comply with such provisions of the Securities Act as may be
necessary to facilitate the disposition of all Registrable Securities
covered by such Registration Statement during the applicable period in
accordance with the intended method or methods of disposition thereof set
forth in such Registration Statement or such prospectus or supplement
thereto;
(ii) notify the Holders, promptly (A) when each Registration
Statement, prospectus, or supplement thereto or further post-effective
amendment has been filed, and, with respect to each Registration Statement
or further post-effective amendment, when it has become effective, (B) of
any request by the SEC for amendments or supplements to any Registration
Statement or prospectus or for additional information, (C) of the issuance
by the SEC of any comments with respect to any filing and of any stop order
suspending the effectiveness of any Registration Statement or the
initiation of any proceedings for that purpose, (D) of the receipt by the
Company of any notification with respect to the suspension of the
qualification of any Registrable Securities for sale in any jurisdiction or
the initiation or threatening of any proceeding for such purpose, (E) of
the happening of any event that makes any statement made in any
Registration Statement, prospectus, or any other document incorporated
therein by reference untrue or that requires the making of any changes in
such Registration Statement, prospectus, or any document incorporated
therein by reference in order that such documents not contain any untrue
statement of a material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein not
misleading, and (F) of the Company's determination that a further post-
effective amendment to such Registration Statement would be appropriate;
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(iii) furnish to each Holder, without charge, as many conformed
copies as may reasonably be requested by such Holder, of each Registration
Statement and any further post-effective amendments thereto, including
financial statements and schedules, all documents incorporated therein by
reference and all exhibits (including those incorporated by reference);
(iv) deliver to each Holder, without charge, as many copies of the
then effective prospectus covering such Registrable Securities and any
amendments or supplements thereto as such Holder may reasonably request;
(v) register, qualify, obtain an exemption therefrom, or cooperate
with the Holders and their counsel in connection with the registration or
qualification or exemption therefrom of such Registrable Securities for
offer and sale under the securities or blue sky laws of such jurisdictions
as may be reasonably requested in writing by the Holders and do any and all
other acts or things necessary or advisable to enable the disposition in
such jurisdictions of the Registrable Securities covered by the then
effective Registration Statements; provided, however, that the Company
shall not be required to (A) qualify as a foreign corporation or generally
to transact business in any jurisdiction where it is not then so qualified,
(B) qualify as a dealer (or other similar entity) in securities, (C)
otherwise subject itself to taxation in connection with such activities, or
(D) take any action which would subject it to general service of process in
any jurisdiction where it is not then so subject;
(vi) upon the occurrence of any event contemplated by clauses (E)
or (F) of paragraph (ii) above, promptly prepare and file, if necessary, a
further post-effective amendment to each Registration Statement or a
supplement to the related prospectuses or any document incorporated therein
by reference or file any other required document so that each Registration
Statement and the related prospectuses will not thereafter contain an
untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein not misleading;
(vii) in no event later than five (5) Business Days before filing
any Registration Statement, any further post-effective amendment thereto,
any prospectus or any amendment or supplement thereto (other than any
amendment or supplement made solely as a result of incorporation by
reference of documents), furnish to the Holders copies of all such
documents proposed to be filed;
(viii) not file any Registration Statement or amendment thereto or
any prospectus or any supplement thereto (other than any amendment or
supplement
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made solely as a result of incorporation by reference of documents) to
which the Holders holding a majority of the Registrable Securities shall
have reasonably objected in writing, within three (3) Business Days after
receipt of such documents, to the effect that such Registration Statement
or amendment thereto or prospectus or supplement thereto does not comply in
all material respects with the requirements of the Securities Act
(including, without limitation respect of any information describing the
manner in which the Holders acquired such Registrable Securities and the
intended method or methods of distribution of such Registrable Securities),
(provided that the foregoing shall not limit the right of any Holder
reasonably to object, within three (3) Business Days after receipt of such
documents, to any particular information relating specifically to such
Holder that is to be contained in any Registration Statement, prospectus or
supplement including without limitation, any information describing the
manner in which such Holder acquired such Registrable Securities and the
intended method or methods of distribution of such Registrable Securities),
and if the Company is unable to file any such document due to the
objections of the Holders, the Company shall exert commercially reasonable
efforts to cooperate with the Holders to prepare, as soon as practicable, a
document that is responsive in all material respects to the reasonable
objections of the Holders, provided however, that the Effectiveness
Deadline (as defined in Section 2(b)) shall be extended by the period,
during which the Company is prevented from filing a Registration Statement
or amendment thereto by reason of this paragraph 3(a)(viii);
(ix) promptly after the filing of any document that is to be
incorporated by reference into any Registration Statement or prospectus,
provide copies of such document to the Holder;
(x) cause all Registrable Securities covered by each Registration
Statement to be listed on the Nasdaq National Market, American Stock
Exchange, any national securities exchange, an over-the-counter market, or,
if the Common Stock securities of the Company are not listed thereon, on
the primary exchanges, markets, or inter-dealer quotations systems
(including NASDAQ) if any, on which similar securities issued by the
Company are then listed, prior to the date on which such Registrable
Securities were issued;
(xi) take all actions reasonably required to prevent the entry of
any stop order by the Securities and Exchange Commission or by any state
securities regulators or to remove any such order if entered; and
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(xii) file post-effective amendments to any Registration Statement
or supplement the related prospectus, as required, to permit sales of
Registrable Securities covered thereby to be made by Permitted Transferees
of the Holders.
(b) Holder Procedures.
(i) The Company may require each Holder to furnish to the Company
such information regarding such Holder and the proposed distribution of
such Registrable Securities as the Company may from time to time reasonably
request in writing and which is necessary for compliance with applicable
law.
(ii) Each Holder agrees to cooperate with the Company in all
reasonable respects in connection with the preparation and filing of the
Registration Statement, any Amendment, any prospectus, and any prospectus
supplement.
(c) Additional Information Available. So long as any Registration
Statement is effective covering the resale of Registrable Securities owned by a
Holder, the Company will furnish to such Holder(s):
(i) as soon as practicable after it becomes available (but in the
case of the Company's Annual Report to Stockholders, within 140 days after
the end of each fiscal year of the Company), one copy of: (A) its Annual
Report to Stockholders (which Annual Report shall contain financial
statements audited in accordance with Canadian generally accepted
accounting principles by a national firm of certified public accountants);
(B) its Annual Report on Form 20-F; and (C) its Quarterly Reports on Form
6-K; and
(ii) upon the reasonable request of a Holder, all exhibits to the
Annual Report on Form 20-F; and the Company, upon the reasonable request of
a Holder, will meet with such Holder or a representative thereof at the
Company's headquarters to discuss all information relevant for disclosure
in any Registration Statement and will otherwise cooperate with any Holder
conducting an investigation for the purpose of reducing or eliminating such
Holder's exposure to liability under the Securities Act including the
reasonable production of information at the Company's headquarters.
4. REGISTRATION EXPENSES.
All expenses incident to the Company's performance of or compliance with
this Agreement, including without limitation all registration and filing fees,
fees, and expenses
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of compliance with state securities or blue sky laws (including fees and
disbursements of counsel in connection with blue sky qualifications or
registrations (or the obtaining of exemptions therefrom) of the Registrable
Securities), messenger and delivery expenses, internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), fees and disbursements of its counsel
and its independent certified public accountants, securities acts liability
insurance (if the Company elects to obtain such insurance), and reasonable fees
and expenses of any special experts retained by the Company in connection with
any registration hereunder (all of such expenses herein referred to as
"Registration Expenses"), shall be borne by the Company; provided, however, the
Registration Expenses shall not include any sales or underwriting discounts,
commissions, or fees attributable to the sale of the Registrable Securities or
the fees and expenses of counsel to the Holders (other than to the extent
provided in the Securities Purchase Agreement).
5. INDEMNIFICATION; CONTRIBUTION.
(a) Indemnification by the Company. The Company shall indemnify and hold
harmless, to the full extent permitted by law, each Holder, and such Holder's
respective officers, directors, employees, representatives, agents, and
controlling persons (within the meaning of the Securities Act), against all
losses, claims, damages, liabilities, and expenses, but in no event greater than
the gross purchase price Holder paid to the Company for Registrable Securities,
resulting from any untrue or alleged untrue statement of a material fact
contained in any Registration Statement, any prospectus, or any amendment or
supplement thereto, or any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except in each case insofar as the same directly arises out of or is
directly based upon an untrue statement or alleged untrue statement of a
material fact or an omission or alleged omission to state a material fact in
such Registration Statement, prospectus, amendment, or supplement, as the case
may be, made or omitted, as the case may be, in reliance upon and in conformity
with information furnished to the Company in writing by such Holder expressly
for use therein.
(b) Indemnification by the Holders. Each Holder shall indemnify and hold
harmless, to the full extent permitted by law, the Company, its officers,
directors, employees, representatives, agents, and controlling persons (within
the meaning of the Securities Act), against all losses, claims, damages,
liabilities, and expenses (including, without limitation, reasonable costs of
investigation and legal expenses) resulting from any untrue or alleged untrue
statement of a material fact contained in any Registration Statement, any
prospectus, or any amendment or supplement thereto, and any omission or alleged
omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading,
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to the extent the same directly result from any untrue statement or alleged
untrue statement of a material fact or any omission or alleged omission to state
a material fact in such Registration Statement, prospectus, amendment, or
supplement, as the case may be, made or omitted, as the case may be, in reliance
upon and in conformity with information furnished to the Company in writing by
such Holder expressly for use therein. The liability of each Holder under the
indemnity and contributions provisions of this Section 5 shall be several and
not joint and shall be limited to an amount equal to the gross price of the
Registrable Securities sold by such Holder pursuant to the Registration
Statement.
(c) Conduct of Indemnification Proceedings. Each party entitled to
indemnification under this Section 5 (the "Indemnified Party") shall give
written notice to the party required to provide indemnification (the
"Indemnifying Party") promptly after such Indemnified Party has actual knowledge
of any claim as to which indemnity may be sought, and shall permit the
Indemnifying Party to assume the defense of any such claim or any litigation
resulting therefrom; provided, that counsel for the Indemnifying Party who will
conduct the defense of such claim or litigation, is approved by the Indemnified
Party (whose approval will not be unreasonably withheld or delayed); and
provided, further, that the failure of any Indemnified Party to give notice as
provided herein shall not relieve the Indemnifying Party of its obligations
except to the extent that its defense of the claim or litigation involved is
prejudiced by such failure. The Indemnified Party may participate in such
defense at such party's expense; provided, however, that the Indemnifying Party
shall pay such expense if representation of such Indemnified Party by the
counsel retained by the Indemnifying Party would be inappropriate due to actual
or potential conflicts of interest between the Indemnified Party and any other
party represented by such counsel in such proceeding. No Indemnifying Party, in
the defense of any such claim or litigation, except with the consent of each
Indemnified Party, shall consent to entry of any judgment or enter into any
settlement that does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such Indemnified Party of a release from all
liability in respect of any claim or litigation, and no Indemnified Party will
consent to entry of any judgment or settle any claim or litigation without the
prior written consent of the Indemnifying Party (not to be unreasonably withheld
or delayed). Each Indemnified Party shall furnish such information regarding
himself, herself or itself and the claim in question as the Indemnifying Party
may reasonably request and as shall be reasonably required in connection with
the defense of such claim and litigation resulting therefrom.
(d) Contribution.
(i) If for any reason the indemnification provided for in this
Section 5 from an Indemnifying Party, although otherwise applicable by its
terms, is
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unavailable to an Indemnified Party hereunder, then the Indemnifying Party,
in lieu of indemnifying such Indemnified Party, shall contribute to the
amount paid or payable by the Indemnified Parties as a result of such
losses, claims, damages, liabilities, or expenses in such proportion as is
appropriate to reflect the relative fault of such Indemnifying Party and
the Indemnified Parties in connection with the actions that resulted in
such losses, claims, damages, liabilities, or expenses, as well as any
other relevant equitable considerations. The relative fault of such
Indemnifying Party and the Indemnified Parties shall be determined by
reference to, among other things, whether any action in question, including
any untrue or alleged untrue statement of a material fact, has been made
by, or relates to information supplied by, such Indemnifying Party or the
Indemnified Parties, and the parties' relative intent, knowledge, access to
information, and opportunity to correct or prevent such action. The amount
paid or payable by a party as a result of the losses, claims, damages,
liabilities, and expenses referred to above shall be deemed to include,
subject to the limitations set forth in Section 5(c), any legal or other
fees or expenses reasonably incurred by such party in connection with any
investigation or proceeding.
(ii) The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 5(d) were determined by
pro rata allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.
6. RULE 144 REQUIREMENTS.
The Company agrees to:
(a) use its best efforts to make and keep public information available, as
those terms are understood and defined in Rule 144 under the Securities Act;
(b) use its best efforts to file with the SEC in a timely manner all
reports and other documents required of the Company under the Securities Act and
the Securities Exchange Act; and
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(c) furnish to each Holder upon request a written statement by the Company
as to its compliance with the reporting requirements of said Rule 144 and of the
Securities Act and the Securities Exchange Act.
7. INJUNCTIONS.
Each of the parties hereto acknowledges and agrees that one or more of the
parties would be damaged irreparably in the event the provisions of this
Agreement are not performed in accordance with their specific terms or otherwise
are breached. Accordingly, each of the parties agrees that the other party
shall be entitled to an injunction or injunctions to prevent breaches of the
provisions hereof in any action instituted in any court of the United States or
any state thereof having jurisdiction over the parties in the matter, in
addition to any other remedy to which it may be entitled, at law or in equity.
8. TERMINATION.
This Agreement shall terminate on the Registration Termination Date;
provided, however, that the provisions of Section 5, 6, and 7 shall survive the
termination of this Agreement.
9. MISCELLANEOUS.
(a) Amendments and Waivers. Except as otherwise provided herein, the
provisions of this Agreement may not be amended, supplemented, or otherwise
modified, and waivers or consents to departures from the provisions hereof may
not be given, unless the Company shall have obtained the prior written consent
of the Holders holding more than 80% of the Registrable Securities at the time
of such amendment.
(b) Notices. Unless otherwise specified, all notices and other
communications provided for between the Company and the Purchaser in this
Agreement shall be in writing, including telecopy, and delivered or transmitted
to the addresses set forth below, or to such other address as shall be
designated by the Company or the Purchaser in written notice to the other party.
Notice sent by telecopy shall be deemed to be given and received when receipt of
such transmission is acknowledged, and delivered notice shall be deemed to be
given and received when receipted for by, or actually received by, an authorized
officer of the Company or the Purchaser, as the case may be.
(i) if to the Purchaser, to such address as is specified for the
Purchaser under the terms of the Securities Purchase Agreement or if to
another Holder, to the
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address indicated on the Company's register relating to the Warrants or
Registrable Securities held by such Holder or at such other address as such
Holder may have furnished to the Company in writing.
(ii) if to the Company, at:
Kafus Environmental Industries Ltd.
000 Xxxxxx Xxxxxx
Xxxxxx XX 00000
Attn: Xx. Xxxxxxx X. XxXxxx
telephone: 000-000-0000
telecopier: 000-000-0000
(c) Successors and Assigns. This Agreement shall be binding upon and shall
inure to the benefit of the Company and each Holder and their respective
successors and assigns. The rights provided by this Agreement shall be
transferred automatically from the Purchaser to any Person to whom the Note, any
Warrants, or any Registrable Securities are transferred, provided that (x) the
Company is given written notice of the transfer and the name, address, telephone
number, and facsimile number of the transferees and (y) the subsequent
transferee agrees in writing to be bound by all of the terms of this Agreement
(any transferee referred to in the foregoing clauses being referred to herein as
a "Permitted Transferee").
(d) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
(e) Headings; Construction. The Section numbers and headings in this
Agreement are for convenience of reference only and shall not limit or otherwise
affect the meaning hereof. Unless the context otherwise requires, all references
to Sections are to sections of this Agreement, and words in the singular include
the plural and vice versa. In computing any period of time specified in this
Agreement or in any notices, the date of the act or event from which such period
of time is to be measured shall be included, any such period shall expire at
5:00 p.m., New York time, on the last day of such period, and any such period
denominated in months shall expire on the date in the last month of such period
that has the same numerical designation as the date of the act or event from
which such period is to be measured; provided, however, that if there is no date
in the last month of such period
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that has the same numerical designation as of the date of such act or event,
such period shall expire on the last day of the last month of such period.
(f) Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of Texas, without regard to the principles of
conflicts of laws thereof which would select any other law.
(g) Arbitration. Disputes arising under this Agreement shall be settled by
one arbitrator pursuant to the rules of the American Arbitration Association
(the "AAA") for Commercial Arbitration (the "Rules"). Such arbitration shall be
held in New York, New York, or at such other location as mutually agreed to by
the parties to the dispute. Subject to any applicable limitations contained in
this Agreement, arbitration may be commenced at any time by any party giving
notice to the other party that a dispute has been referred to arbitration under
this Section. The arbitrator shall be selected by the joint agreement of the
parties hereto, but if they do not so agree within twenty (20) days after the
date of the notice referred to above, the selection shall be made pursuant to
the Rules from the panel of arbitrators maintained by the AAA. Any award of the
arbitrator shall be accompanied by a written opinion giving the reasons for the
award. The expense of the arbitration shall be borne by the parties in the
manner determined in writing by the arbitrator. This arbitration provision shall
be specifically enforceable by the parties. The determination of the arbitrator
pursuant to this Section shall be final and binding on the parties and may be
entered for enforcement before any court of competent jurisdiction.
(h) Severability. If one or more of the provisions hereof, or the
application thereof in any circumstance, is held invalid, illegal, or
unenforceable in any respect, for any reason, the validity, legality. and
enforceability of the remaining provisions hereof shall not be in any way
affected or impaired thereby, and the provisions held to be invalid, illegal, or
unenforceable shall be reformed to the minimum extent necessary, and in a manner
as consistent with the purposes thereof as is practicable, so as to render it
valid, legal, and enforceable.
(i) Entire Agreement. This Agreement is intended by the parties hereto to
be a final expression thereof and is intended to be a complete and exclusive
statement of the agreement and understanding of such parties in respect of the
subject matter contained herein related to the Registrable Securities. This
Agreement supersedes all prior agreements and understandings among the Company
and any of the Holders with respect to such subject matter.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
KAFUS ENVIRONMENTAL INDUSTRIES LTD.
By:
-----------------------------
Name:
---------------------------
Title:
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ENRON CAPITAL & TRADE RESOURCES CORP.
By:
-----------------------------
Name:
---------------------------
Title:
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[Registration Rights Agreement]
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