EXHIBIT 7
CONDITIONAL SALE AND PURCHASE AGREEMENT entered into by and between
INDUSTRIAS Q.A.I., S.A. DE C.V., herein represented by ▇▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Bromfman, in her capacity as Sole Administrator, (hereinafter referred to as
"QAI"), by Mrs. OPAL ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, on her own behalf, and ▇▇.
▇▇▇▇▇▇ ▇▇▇▇▇▇ GIVEN TRACKMAN, on his own behalf, (hereinafter jointly referred
to as "SELLERS"), and by REFRIGERATION TECHNOLOGY, INC. herein represented by
▇▇. ▇▇▇▇ ▇▇▇▇▇▇, in his capacity as SOLE DIRECTOR, (hereinafter referred to as
"REF-TECH"), pursuant to the following Recitals and Clauses:
RECITALS
I. QAI hereby declares that:
a) It is a corporation duly incorporated and existing pursuant to
the laws of the Republic of Mexico, with its domicile in
Ciudad ▇▇▇▇▇▇, Chihuahua.
b) It operates as an in-bond manufacturing corporation in Ciudad
▇▇▇▇▇▇, Chihuahua, and its owns and/or operates all of the
Assets included in the list attached hereto as Exhibit "A"
(hereinafter referred to as the "Assets").
c) The Assets have been temporarily imported under the In-Bond
Manufacturing Program of Mexico (hereinafter referred to as
the "Maquiladora Program"), and are used in the manufacture of
air conditioning equipment and other related products, which
are exported from Mexico.
d) It wishes to sell and/or transfer under the terms and
conditions hereof the Assets to REF-TECH or to a Mexican
company to be incorporated by REF-TECH (hereinafter referred
to as "NEWCO").
II. SELLERS hereby declare that:
a) They are individuals of United States nationality, with their
principal place of business in El Paso, State of Texas.
b) They own all of the issued and outstanding shares of QAI,
(hereinafter referred to as the "Shares").
c) They wish to sell, under the terms and conditions hereof, the
Shares to REF-TECH.
III. REF-TECH hereby declares that:
a) It is a corporation incorporated and existing pursuant to the
laws of the State of Delaware, United States of America, with
its principal place of business in Darien, State of
Connecticut, United States of America.
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b) It wishes to either buy the Shares, or create a new Mexican
company (hereinafter referred to as "NEWCO"), to which the
Assets currently operated by QAI will be transferred, under
the terms and conditions hereof.
IV. The parties hereby declare that:
There has been no error, bad faith or duress amongst them.
IN VIEW OF THE FOREGOING, the parties agree on the following:
ARTICLES
ARTICLE 1. - SALE AND PURCHASE OF SHARES.
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Subject to the condition of REF-TECH carrying out a due diligence
review of QAI, and being satisfied as to the operations carried out by said
company and the liabilities assumed or incurred by QAI, REF-TECH will acquire
from SELLERS the Shares, for a price equal to the book value of the Shares (net
worth of QAI once all liabilities are deducted from the value of assets divided
by the number of Shares), or the amount of $1,000.00 (ONE THOUSAND PESOS 00/100)
Mexican currency, whichever is higher.
The SELLERS hereby deliver to Mr. ▇▇▇▇▇ ▇▇▇▇▇▇▇, in his capacity as
Escrow Agent, stock certificates numbers 1 through 10, representing the Shares,
which have been endorsed by SELLERS, and which will be delivered by ▇▇. ▇▇▇▇▇▇▇
to REF-TECH in the event that REF-TECH decides to acquire the Shares.
ARTICLE 2. - TRANSFER OF OPERATIONS.-
-----------------------------------
In the event that after carrying a due diligence review, REF-TECH
decides that it does not wish to acquire the Shares, but rather, that it will
incorporate NEWCO and transfer the Assets and operations currently performed by
QAI to NEWCO, then QAI commits to undertake all steps which may be necessary in
order to transfer such operations, including but not limited to executing an
Employer Substitution Agreement with NEWCO and notifying each and everyone of
the employees of such substitution, as provided by Article 41 of the Federal
Labor Law, signing an Assignment Agreement of the facilities currently leased by
QAI, requesting the authorization to transfer the
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Maquila Program from QAI to NEWCO from the Ministry of Commerce and Industrial
Development and providing all information which may be necessary for NEWCO to be
in full compliance with Mexican Law.
In the event that REF-TECH decides to transfer the operations and
Assets to NEWCO, then NEWCO will pay to QAI a consideration equal to the book
value of the Assets owned by QAI.
ARTICLE 3. - TRANSITION PERIOD.-
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From February 20, 1997 until the time that REF-TECH either buys the
Shares or transfers the operations and Assets from QAI to NEWCO, as the case may
be, REF-TECH will have the authority to manage QAI, for which purpose, SELLERS
and QAI commit to grant an irrevocable power of attorney for lawsuits and
collections, acts of management, to sign negotiable instruments and to grant
other powers of attorney, to the individual designated by REF-TECH.
ARTICLE 4. - TAXES.-
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All taxes triggered by the transfer of Shares and/or the transfer of
operations and Assets from QAI to NEWCO, will be paid by the party which may
correspond in accordance with the applicable legal provisions.
ARTICLE 5. - TERM.-
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REF-TECH will have a term of 60 (sixty) days counted from the date of
execution hereof, to decide whether to acquire the Shares or transfer the
operations from QAI to NEWCO. At such time, REF-TECH will notify SELLERS and QAI
of its decision.
In the event that REF-TECH decides to acquire the Shares, then the sale
must be completed (delivery of the Shares by ▇▇. ▇▇▇▇▇▇▇ to REF-TECH and of the
price by REF-TECH to SELLERS), within a term 3 (three) days from the date that
REF-TECH notifies the other parties of its decision.
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In the event that REF-TECH decides to incorporate NEWCO and to transfer
the operations from QAI to NEWCO, then such transfer will be completed within a
term of 120 (one hundred and twenty) days after REF-TECH notifies the other
parties of its decision.
ARTICLE 6. - NON-COMPETE.-
------------------------
SELLERS hereby commit not to either directly or indirectly compete or
engage in manufacturing of air conditioning equipment and related products, for
a term of 5 (five) years, counted from the date of execution hereof.
ARTICLE 7. - ENTIRE AGREEMENT; MODIFICATION.-
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This Agreement and any documents executed in connection herewith
constitute the entire Agreement and understanding among the parties to this
Agreement and supersedes any and all prior agreements, understandings and
arrangements oral or written between the parties with respect to the subject
matter hereof except for the Acquisition Agreement of even date hereof entered
into by and between REF-TECH and Quality Air, Inc. This Agreement may be
modified or amended only by a written instrument executed by all of the parties
hereto.
ARTICLE 8. - CAPTIONS.-
---------------------
Articles, sections and paragraph titles or captions contained in this
Agreement are inserted only as a matter of convenience and for reference and in
no way defined, limit, extend or describe the scope of this Agreement or the
intent of any provisions hereof.
ARTICLE 9. - NOTICES.-
--------------------
Any notices permitted or required to be given under this Agreement
shall be deemed given or made upon personal delivery to the person to whom
addressed, the day following delivery to a recognized overnight courier service
or upon acknowledgment of receipt of any notices delivered by a facsimile
machine.
Notices permitted or required to be given under this Agreement shall be
addressed as follows:
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QAI: INDUSTRIAS Q.A.I., S.A. DE C.V. c/o Quality Air, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
SELLERS: Mrs. OPAL ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ #▇▇▇
▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇ GIVEN TRACKMAN
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
REF-TECH: REFRIGERATION TECHNOLOGY, INC.
c/o ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
ARTICLE 10. - ENFORCEABILITY.-
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If any provision of this Agreement is determined to be invalid or
unenforceable, such determination shall not affect the validity or
enforceability of the other provisions of this Agreement.
ARTICLE 11. - BINDING EFFECT.-
----------------------------
This Agreement shall be binding upon and inure to the benefit of the
parties and their respective heirs, administrators, legal representatives and
permitted assigns.
ARTICLE 12. - COUNTERPARTS.-
--------------------------
This Agreement may be executed in one or more counterparts, any party
to this Agreement may execute and deliver this Agreement by executing and
delivering any of such counterparts, each of which when executed and delivered
shall be deemed to be an original and all of which taken together constitute and
the same instrument.
ARTICLE 13. - GOVERNING LAW.-
For the interpretation and enforcement of this Agreement, the parties
submit hereby to the applicable laws and competent courts in Ciudad ▇▇▇▇▇▇,
Chihuahua hereby expressly waiving any other jurisdiction which may correspond
to them by reason of their present or future domiciles.
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HAVING READ THE FOREGOING, the parties signed this Agreement to their
full satisfaction in El Paso, Texas, on February 19, 1997.
"QAI" "REF-TECH"
INDUSTRIAS Q.A.I., REFRIGERATION TECHNOLOGY, INC.
S.A. DE C.V.
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Bromfman /s/ ▇▇▇▇ ▇▇▇▇▇▇
-------------------------------- -------------------------
▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇ Bromfman ▇▇. ▇▇▇▇ ▇▇▇▇▇▇
Sole Administrator Sole Director
"SELLERS"
/s/ Opal ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Given Trackman
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Mrs. Opal ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇ Given Trackman