EXHIBIT 10.1
AGREEMENT OF ASSOCIATION FOR DEVELOPMENT OF REAL PROPERTY AND
CONSTRUCTION OF HOUSES IN MEXICO
THIS AGREEMENT, with date June 22, 2004, puts the mutual agreements and
responsibilities of the signers that it will serve as the base of the agreement
definitive and detailed between the parts that later are described: CONSTRUCTOR
AND INMOBILARIA CIFASA S.A de C.V. ("CIFASA") and ADVANCED CONSTRUCTION and
MANUFACTURING TECHNOLOGIES DE MEXICO S.A. de C.V. ("ACMT"), SOUTHWEST MANAGEMENT
SOLUTIONS CORPORATION, a Corporation of Nevada ("SOWEST") and NOXSO CORPORATION,
("NOXSO") a Corporation of Virginia, as signers with particular interests and
related responsibilities
WHEREAS, CIFASA wants to develop real property in Mexico (housing of
social interest) with properties that it owns in its name and other properties
where it has agreements to acquire in the future; and,
WHEREAS, ACMT is a subsidiary of NOXSO, and it has a system for the
construction of housing with mutual agreement with SOWEST that will be
beneficial to the targets of CIFASA;
THEREFORE, BOTH ARE IN ACCORDANCE WITH THE FOLLOWING CLAUSES:
FIRST CLAUSE
CIFASA
CIFASA represents and warrants to ACMT and other signatories its
responsibilities in accordance with this Agreement and they are as follows:
1. CIFASA owns or has the rights to 5 real estate projects of various
sizes which real estate shall be contributed to the project to assist ACMT with
its responsibility to obtain the financial resources to develop the real estate
and construct single family residences thereon. In the first 4 projects there
are a total of approximately 772 single family residential houses, approximately
520 one-bedroom houses in duplex format, and approximately 252 three bedroom
houses in duplex format (the "houses"). The fifth project is a large
multi-phase, mixed-use project that includes approximately 7,000 single family
residential homes in various formats, together with several commercial sites,
school and hospital areas and a shopping center site;
2. CIFASA has obtained all of the required permits and licenses to
develop the first 4 projects and it will be responsible to obtain the required
permits and licenses for all phases of the fifth project that will be developed
and constructed by ACMT;
3. CIFASA is responsible to work with and obtain from available
financial sources, including but not limited to INFONAVIT, FOVI and commercial
banks, for guaranteed total payment for the finished houses upon completion, and
hereby commits to work closely with the respective financial sources and obtain
such total payments upon completion of the houses and to promptly pay ACMT for
each completed house within 3 days of receipt of such payments from all
respective financial sources on each of the projects.
4. CIFASA is responsible to use its association and experience to
obtain from various unions, syndicates and groups qualified and approved buyers
for the finished houses acceptable to the financial sources as set forth in
paragraph 3., above.
5. CIFASA is responsible to participate and cooperate with ACMT, and to
obtain the approval of the other signatories, with the development of the range
of sales prices for the houses in each of the projects, and to participate and
cooperate with ACMT, and to obtain the approval of the other signatories, with
the development of cost budgets for each of the various types of houses in each
of the projects.
SECOND CLAUSE
ACMT
ACMT represents and warrants to CIFASA and other signatories its
responsibilities in accordance with this Agreement and they are as follows:
6. ACMT has the management, staff and personnel with the experience and
capacity, and hereby commits to be responsible to develop real property from its
current condition to finished lots ready for the construction of houses, or as
sometimes referred to in Mexico as the `Urbanization' of the project; and,
additionally, to supervise the construction of the houses on the CIFASA projects
from inception to final completion in accordance with local regulations and
condition.
7. ACMT has an in-place agreement with SOWEST and hereby commits to
employ SOWEST and its proprietary system of construction for cement pads and
footings, the construction of all of the walls in the houses using the concrete
masonry units of various types as recommended and approved by SOWEST, and to use
SOWEST in the construction of the roofs on all such houses
8. ACMT will be responsible to obtain the financial resources for the
development/urbanization and construction costs on the projects, except for the
cost of the land that will be the responsibility if CIFASA, in accordance with
the budgets as agreed initially, or as revised, including but not limited to all
workers and support personnel as required to construct the pads, footings, walls
and roofs of the houses under the direction of SOWEST, and all sub-contractors
or others as required to complete the houses ready for occupancy.
9. ACMT is responsible to work with and obtain from CIFASA total
payment for the finished houses upon completion, and hereby commits to work
closely with the CIFASA and the respective financial sources to obtain such
total payments upon completion of the houses and to promptly pay SOWEST, as well
as all other sub-contractors or personnel, in accordance with all contracts,
agreements and commitments, for each completed house, in accordance with the
terms and conditions as set forth in the definitive development and construction
agreements.
10. ACMT is responsible to participate and cooperate with CIFASA, and
to obtain the approval of the other signatories, with the development of the
range of sales prices for the houses in each of the projects, and to participate
and cooperate with CIFASA, and to obtain the approval of the other signatories,
with the development of cost budgets for each of the various types of houses in
each of the projects.
THIRD CLAUSE
SOWEST
SOWEST represents and warrants ACMT and other signatories its responsibilities
in accordance with this Agreement and they are as follows:
11. SOWEST has the management, the personnel with the experience and
capacity, and hereby commits to be responsible for the supervision of the cement
pads, footings and foundations, interior and exterior walls, as well as the
second floor on 2 story houses, and the roof for all of the houses on the CIFASA
projects in accordance with the regulations and conditions of the local, State
and Federal governments of the Republic of Mexico.
12. SOWEST has an in-place agreement with ACMT and hereby commits to
use its best efforts, experience and expertise utilizing its proprietary system
of construction for cement pads, footings and foundations, the construction of
all of the interior and exterior walls, as well as the second floor on 2 story
houses, in the houses using such concrete masonry units of various types as meet
or exceed, in SOWEST'S sole discretion, the recommended and approved concrete
masonry units of the financial sources and/or the local regulations; and to use
its' techniques in the construction of the roofs on all such houses on behalf of
ACMT and share ACMT'S responsibility for such houses, but limited to only its
areas of construction.
13. SOWEST is responsible to work with and obtain from ACMT and/or
CIFASA timely payment for the finished houses upon completion, and to promptly
pay in accordance with the terms and conditions as set forth in the definitive
construction agreement, all material and personnel costs related to the areas of
its responsibility on the CIFASA projects, as well as any and all other
sub-contractors or personnel utilized in the completion of its areas of
responsibilities under this Agreement, in accordance with all of its contracts,
agreements and commitments, upon receipt of payment for each completed house on
each of the projects; and,
14. SOWEST is responsible to participate and cooperate with ACMT, and
to obtain the approval of the other signatories, with the development of the
range of sales prices for the houses in each of the projects, and to participate
and cooperate with CIFASA, and to obtain the approval of the other signatories,
with the development of cost budgets for each of the various types of houses in
each of the projects.
FOURTH CLAUSE
NOXSO
NOXSO represents and warrants to CIFASA and the other signatories as that its
responsibilities under this Agreement are as follows:
15. NOXSO has the responsibility to supervise, manage, approve and
financially support the responsibilities of its wholly owned subsidiary ACMT;
16. NOXSO has an in-place agreement with SOWEST for the management and
assistance with several phases of its operations and some of the operations of
its wholly owned subsidiary ACMT, and hereby commits to use its best efforts,
experience and expertise utilizing its working relationship and agreements with
SOWEST for the benefit of the CIFASA projects using concrete masonry units as a
source of operational and financial assistance to ACMT;
17. NOXSO is responsible to assist, as necessary, ACMT and/or CIFASA
for the timely payment for the finished houses upon completion; and
18. NOXSO is responsible to participate and cooperate with ACMT, and to
obtain the approval of the other signatories, with the development of the range
of sales prices for the houses in each of the projects, and to participate and
cooperate with CIFASA, and to obtain the approval of the other signatories, with
the development of cost budgets for each of the various types of houses in each
of the projects.
MUTUAL REPRESENTATION OF THE COMPANIES
The Companies hereto, each individually represent and warrant to the
other Companies as follows:
19. Organization: Each of the COMPANIES is a duly organized and validly
existing corporation in good standing under the laws of Mexico and/or the laws
of the State of incorporation. The Company is duly qualified to do business and
is in good standing in Mexico its principal domicile and may establish agencies
or branches in each jurisdiction in which it anticipates to do business.
20. Authorization. All approvals and action on the part of CIFASA,
ACMT, SOWEST and NOXSO (the "COMPANIES"), if any, necessary for the due
authorization, execution and delivery of this Agreement and the consummation of
the transactions contemplated herein, has been or will be taken prior to or as
of the date of the final definitive agreements. This Agreement is a legal, valid
and binding agreement of the signatory companies, enforceable in accordance with
its terms. The execution, delivery and performance by companies, of this
Agreement, will not result in any violation of or be in conflict with, or result
in a breach of or constitute a default under, any term or provision of any legal
requirement, contract or agreement to which any of the COMPANIES is subject.
21. Consents. No consent, approval, qualification, order or
authorization of, or filing with any governmental authority is required in
connection with the valid execution, delivery or performance of the this
Agreement, by the COMPANIES.
22. Definitive agreements. The COMPANIES agree to prepare definitive
real property development and housing construction agreements that incorporate
the general terms and the conditions of this agreement and subsequent
negotiations between THE COMPANIES. These definitive agreements will be
completed before July 10, 2004, and shall contain, among other things, customary
representations, warrants and indemnifications. Such representations, warrants
and indemnifications will relate but not limited to the definitive costing for
development of each project as agreed to by CIFASA, ACMT and NOXSO, together
with the definitive costing of the construction of the houses as agreed to by
CIFASA, ACMT, SOWEST and NOXSO using the system of construction of SOWEST
including the specific terms, responsibilities, conditions and requirements for
each of the projects of CIFASA.
23. Expenses. All the COMPANIES shall each bear its own expenses
(including, without limitation, legal and countable fees) incurred in connection
with the transactions contemplated in this agreement, but shall be entitled to
be reimbursed for all amounts recognized by the COMPANIES.
24. Counterparts. This Agreement can be executed in any number of
original doubles or counterparts, each of which will be of equal force and
effect.
25. Titles, Headings and Clauses. The Titles, Headings and Clauses of
this Agreement are for the convenience of reference by the COMPANIES and they
will not affect the construction of any provision of this Agreement.
The undersigned signatories have executed this Agreement as of the date
June 23, 2004, as witness that the terms and conditions contained herein
reflects our mutual understanding and agreement.
SIGNATURES OF THE COMPANIES
CONSTRUCTORA AND INMOBILARIA
CIFASA S.A de C.V. (CIFASA)
/s/ Javier Santa Maria
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By: Javier Santa Maria
Its: Director and President
ADVANCED CONSTRUCTION and MANUFACTURING
TECHNOLOGIES OF MEXICO S.A of C.V. (ACMT)
/s. Maximilliano Ismael Silva
- -----------------------------------
By: Maximilliano Ismael Silva
Its: Director and Vice-President
of Operations
SOUTHWEST MANAGEMENT SOLUTIONS CORPORATION (SOWEST)
/s/ Wynn L. Westmoreland
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For: Wynn L. Westmoreland
Its: CEO and President
NOXSO CORPORATION (NOXSO)
/s/ Richard J. Anderson
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By: Richard J Anderson
Its: CEO and President