October 8,   1997


Refrigeration Technology Inc.
              Attn:        Mr. Theo Muller, Chairman and CEO
301 Antone, P.O. Box 3048
Sunland Park, New Mexico 88063

Re:  $600,000  loan  between  Norwest  Bank El Paso,  N.A.,  a national  banking
association  ("Lender" or "Bank") and Refrigeration  Technology Inc., a Delaware
corporation (the "Borrower")

Gentlemen:

          This will  evidence  Lender's  agreement to make Borrower that certain
loan (the  "Loan")  in an amount not to exceed SIX  HUNDRED  THOUSAND  AND NO/00
DOLLARS  ($600,000),   said  Loan  to  be  secured  in  part  by  the  foregoing
(collectively,  the  "Collateral"):  (i) a  security  interest  in  and  to  the
furniture,  fixtures and equipment  now owned or hereafter  acquired by Borrower
and  described  on  Exhibit  "A"  attached  hereto and made a part  hereof  (the
"Equipment")  and all  proceeds  derived  therefrom,  as evidenced by a Security
Agreement of even date herewith,  (ii) by the assignment by RTI INC., a New York
corporation  ("RTI" or "Guarantor") of l00' of the issued and outstanding shares
of all  classes of stock of  Borrower,  as  evidenced  by a Pledge and  Security
Agreement  of even  date  herewith,  and  (iii) by a first  lien  Deed of Trust,
Security  Agreement and Financing  Statement ("Deed of Trust") and Assignment of
Rents  and  Leases  and  Security  Agreement  ("Assignment"),  both of even date
herewith,  covering the  following  described  real  property  together with all
permanent improvements thereon or to be constructed thereon, to wit:

          Lots 3 through 20 and 41 through  58,  Block 15,  WESTWAY  UNIT II, an
          addition to El Paso  County,  Texas,  according to the plat thereof on
          file in Volume 17, Page 35, Real  Property  Records,  El Paso  County,
          Texas (the "Property")

          The  Loan  shall  be   additionally   secured  by  the   absolute  and
unconditional guaranty agreement of RTI.

          The Loan shall be evidenced by a Promissory Note in substantially  the
form attached  hereto as Exhibit "B" in the amount of $600,000.00  (the "Note"),
representing  funds to be advanced to reimburse  Borrower for acquisition  costs
associated  with the Property,  the costs incurred by Borrower in the renovation
of the Property and the expenses  associated with the purchase and  installation
of the Equipment.

          1. Closing Documents. At the time of closing of the Loan, Borrower and
Guarantor shall furnish the following (collectively, the "Closing Documents") in
form satisfactory to Lender:

                    (a)     This Loan Agreement;

                    (b)     The Note executed by Borrower;



<PAGE>





___________________, 1997

Page 2


(c) The Deed of Trust covering the Property, executed by Borrower;

(d) The Assignment covering the Property, executed by Borrower and Lender;

(e) The Security Agreement covering the Personal Property,  executed by Borrower
and Lender;

                     (f) The Pledge and Security Agreement covering the stock of
           Borrower, executed by Guarantor and Lender;

                     (g)  UCC-1  Financing  Statement(s)  for  recording  in the
           County Clerk's office of El Paso County, Texas,  Secretary of State's
           offices in Austin, Texas and Secretary of State's Office of Santa Fe,
           New Mexico;

                     (h)    Guaranty Agreement executed by Guarantor;

                     (i)    Statutory Notice of No Oral Agreements;

               (j)    Acknowledgment of Non-Representation by Lender's Counsel;

                     (k) A  Mortgagee's  Policy  issued by  Lawyers  Title of El
           Paso,  Inc.  (the  "Title  Company"),  in the amount of  $450,000.00,
           containing  only such  exceptions  as may be  approved  in writing by
           Lender,  insuring  the liens of Lender as first and prior  liens with
           respect to the Property;

                     (1) A Plat  based on a survey  by a  licensed  engineer  or
           surveyor  satisfactory  to  Lender,  showing  the  boundaries  of the
           Property, locations of all improvements and all easements, containing
           only those exceptions approved in writing by Lender;

                    (in)  Unanimous  Consent  of  the  Board  of  Directors  and
          Shareholders of Borrower  evidencing the  authorization of Borrower to
          obtain the Loan from Lender and to execute the documents  contemplated
          herein to be signed  between  Borrower  and Lender with respect to the
          Loan and the transactions contemplated hereby;

                    (n)  Evidence  of  the   approval  by  the  Small   Business
          Administration  ("SBA") and the Upper Rio Grande  Development  Company
          ("CDC") of the terms of this Loan,  the loan  documents to be executed
          in connection  herewith,  and the proposed  permanent  financing in an
          amount  not to  exceed  $350,000.00  to be  provided  by the  Bank  to
          Borrower (the "Bank Permanent Loan"),  which Bank Permanent Loan is to
          be funded in conjunction  with that certain loan to be provided to the
          Borrower   (the  "SBA   Loan")   under  the  terms  of  the  SEA  Loan
          Authorization and Guaranty Agreement (as hereinafter defined);

                     (o)  Unless  waived  in  writing  by  Bank  at the  time of
           Closing,  an executed SBA Loan  Authorization and Guaranty  Agreement
           for the United States Small Business  Administration Upper Rio Grande
           Development   Company,   Loan  Program  504  of  the  Small  Business
           Investment  Act of 1958,  signed  on  behalf  of the SEA  (the  "Loan
           Authorization  and Guaranty  Agreement"),  pertaining to a permanent,
           partial takeout  commitment with respect to the Loan in an amount not
           less than $250,000.00;



<PAGE>





___________________, 1997

Page 3


                     (p)  An  appraisal  of  the  Property  prepared  by an  MAI
           certified  appraiser  licensed  to do business in the State of Texas,
           approved by Lender, opining that the Property has a fair market value
           of at least $775,000.00;

                    (q) An executed  Environmental  Indemnity  Agreement  in the
          form  attached  hereto as  Exhibit  "C" dated  concurrently  with this
          Agreement,  duly  executed by the  Borrower in favor of Bank,  whereby
          such  parties  agree to  indemnify  and hold  harmless  Bank  from the
          consequences   of  any   Hazardous   Materials   (as  defined  in  the
          Environmental  Indemnity  Agreement),  in,  on,  under  or  about  the
          Property;

                    (r) Such evidence as Bank may require to confirm  receipt by
          Borrower  of  a   satisfactory   efficiency  and  safety  rating  from
          Electronics Testing Lab and the American Refrigeration Institute;

                    (s) All  documentation  that may be reasonably  requested by
          Bank with respect to the ongoing environmental proceedings relating to
          the property  owned by  Guarantor  in  Rockaway,  New Jersey (the "New
          Jersey Property") and with respect to the  environmental  condition of
          the Property;

(t) Such UCC lien  searches with respect to Borrower and Guarantor as Lender may
reasonably require;
                    (u) Unanimous Consent of the Board of Directors of Guarantor
          evidencing  the  approval of the  guaranty  and pledge of stock by the
          Guarantor  of the Loan and that the  execution  and  delivery  of such
          Guaranty  Agreement  and Pledge and  Security  Agreement  will benefit
          Guarantor, either directly or indirectly;

                    (v) Evidence satisfactory to Bank of the corporate existence
          and current  corporate  good standing of Borrower and Guarantor in the
          States of Delaware and New York,  respectively,  and the qualification
          and good  standing of  Borrower  to transact  business in the State of
          Texas;

                    (w)  Evidence  satisfactory  to  Bank  of the  injection  of
          capital by the Borrower into the Property in an amount greater than or
          equal to $108,785.00;

                    (x) Evidence satisfactory to Bank that any remodeling of any
          improvements   on  the   Property  or  any   additional   improvements
          constructed  thereon  conform  with the  National  Earthquake  Hazards
          Reduction Program; and

(y) Such other information and/or documents as Lender may reasonably require.

2. Covenants.  Re~Representations and Warranties.  As an inducement to Lender to
make the Loan herein  contemplated,  Borrower and  Guarantor  make the following
representations, warranties and covenants:

                    (a) Other than the  existence  of that  certain  Utility and
          Drainage  Easement recorded in Book 17, Page 35, Real Property Records
          of El Paso,  County,  Texas (the "utility  easement") which in part is
          located underneath the building and other improvements situated on the
          Property, there is no significant material fact or



<PAGE>






Page 4


           condition relating to the financial condition of Borrower,  Guarantor
           or to the  Collateral  which has not been  disclosed  in  writing  to
           Lender.

                    (b) No Deed of Trust,  Security  Agreement or other security
          instrument  covering  the  Property  has been  executed,  no Financing
          Statement filed, and no lien,  security  interest,  mechanic's lien or
          materialmen's  lien,  has  attached to or been  perfected  against the
          Collateral.

                     (c) Borrower  represents  and warrants  that  Borrower is a
           Delaware  corporation,  duly organized,  validly existing and in good
           standing  under  the  laws  of the  State  of  Delaware  and is  duly
           qualified and in good standing under the laws of the State of Texas.

                    Guarantor  represents  and warrants that  Guarantor is a New
          York corporation duly organized, validly existing and in good standing
          under the laws of the State of New York.

                    (d) During the term of the Loan, Borrower,  at its sole cost
          and  expense,  will  maintain  or cause to be  maintained  policies of
          insurance,  each with a standard mortgagee's clause, with loss payable
          to the Lender, providing that no cancellation,  reduction in amount or
          material change in coverage shall be effective until at least ten (10)
          days after receipt by Lender and Borrower of written  notice  thereof,
          issued  by such  insurers  with  such  types  of  coverage  (including
          worker's compensation, flood insurance,  casualty/hazard insurance and
          public   liability   insurance)  and  in  such  amounts  as  shall  be
          satisfactory  to Lender.  Borrower  covenants and agrees to deliver to
          Lender  the  original  of any and all  policies  or  renewal  policies
          required  hereunder,  bearing the notations  evidencing the payment of
          premiums.

                    (e)  During the term of the Loan,  Borrower  will pay before
          the  same  become  delinquent  all  taxes,   assessments  and  special
          assessments  (including  paving) of every kind that may be assessed or
          levied  against  the  Property  or any  part  thereof.  Upon  request,
          Borrower  will provide to Lender  evidence of such payment which shall
          be either (i) photo copy  (front  and back) of the  canceled  check or
          (ii) a duplicate tax receipt showing that payment has been made.

                    (f) Borrower  shall pay all costs and  expenses  incurred in
          connection  with  the  transaction  herein  contemplated,   including,
          without  limitation,  the  fees of  attorneys  for  Lender  for  their
          services in  connection  with the  preparation  of this  Agreement and
          related loan documents and in connection  with the closing of the Loan
          as well as all title insurance and other insurance premiums.

                    (g)  Borrower  will not permit any of the Property to become
          subject  to  any  liens  or  encumbrances   other  than  those  herein
          referenced, including specifically the SEA Loan.

                    (h) Borrower and Guarantor  will  promptly  notify Lender of
          any material adverse changes in the facts or circumstances represented
          or warranted  by Borrower or Guarantor in this  Agreement or in any of
          the Closing  Documents or other  documents or  certificates or reports
          furnished to Lender in connection with this Agreement.



<PAGE>





Page 5


                     (i) The transaction  contemplated  hereby and the execution
           and delivery of the loan  documents  contemplated  herein,  have been
           duly authorized by all requisite  corporate action required on behalf
           of Borrower and  Guarantor,  and such loan  documents  constitute the
           legal,  binding  and  enforceable  obligations  of the  such  parties
           thereto in accordance with their terms.

                     (j) Borrower and  Guarantor  shall each furnish to Bank (i)
           within  forty-five  (45) days after the end of each  fiscal  quarter,
           beginning  with the quarter  ending  September  30, 1997,  internally
           prepared financial  statements for the preceding quarter,  consisting
           of at least a balance  sheet,  income  statement  and profit and loss
           statement  and a statement of  compliance  with each of the financial
           covenants  and ratios set forth in Section 2 (1),  together with such
           supporting  information  with regards thereto as Bank may require and
           (ii) by April 30 each year during the term of the Loan,  or within 30
           days  from the  date of  filing  thereof,  copies  of the  respective
           federal  income tax returns with all schedules  appended  thereto for
           each of Borrower and Guarantor.

                    All of the  financial  statements  to be provided  hereunder
          shall be prepared in accordance  with  generally  accepted  accounting
          principles,  consistently  applied, and shall be certified as true and
          correct  by the  President  or  chief  financial  officer  of  each of
          Borrower and Guarantor.  Each of Borrower and Guarantor  shall furnish
          to Bank such additional financial information as Bank may from time to
          time request.

                    (k)  Guarantor  shall  provide to Bank copies of each of its
          quarterly l0-Q reports and annual 10-K reports within thirty (30) days
          of the  date of  filing  thereof  with  the  Securities  and  Exchange
          Commission;

                   (1)  During  the term of this Loan,  Guarantor  and  Borrower
          shall  maintain,  on a  consolidated  basis,  the following  financial
          covenants and ratios, to wit:

                                (i)  A  ratio  of  current   assets  to  current
                   liabilities  (the "Minimum Current Ratio") of at least 1.6 to
                   1, at all times.

(ii) A maximum  total  liabilities  to total net worth ratio of 1.5 to 1, at all
times.

                             (iii)  Commencing  as  of  December  31,  1998  and
                   continuing  thereafter  during  the  term  of  the  Loan,  an
                   aggregate minimum cash flow to prior years current maturities
                   of long  term  debt  ratio  of one  hundred  and  twenty-five
                   percent  (l25%),  calculated as a fraction,  the numerator of
                   which shall be the sum of (x) the  aggregate  net income plus
                   depreciation   less  (y)   distributions   and  dividends  to
                   partners,  managers and members, and shareholders of Borrower
                   and Guarantor,  and the denominator of which shall be the sum
                   of  current  maturities  of long  term debt for the year just
                   ending.  This ratio shall be tested on an annual  basis using
                   the   consolidated   fiscal   year  end   audited   financial
                   statements.



<PAGE>




Page 6

                    For the purpose of determining  compliance  with each of the
          financial  covenants set forth in this Agreement,  all covenants shall
          be defined and  determined  in  accordance  with GAAP,  based upon the
          consolidated financial statements of Guarantor.

                     At the time  Guarantor  and  Borrower  provide  to Bank the
           quarterly  financial  statements  described  in Section  2(j)  above,
           Borrower and Guarantor shall provide  evidence of the compliance with
           the  financial  ratios and  covenants  set forth above,  or if not in
           compliance  the  amount of  variation  therefrom,  and in  connection
           therewith provide all supporting  information,  reports and financial
           data (both present and historical) as Bank may require.

                     (in) Neither Borrower nor Guarantor shall pay any dividends
           until the remediation proceedings relating to the New Jersey Property
           have been completed and a no further action letter has been issued by
           the State of New Jersey and any other governmental, administrative or
           regulatory  agency  having  jurisdiction  with  respect  thereto  and
           evidence  satisfactory  in all  respect to Bank has been  provided to
           Bank.

                   (n)  During  the  term  of the  Loan,  each of  Borrower  and
          Guarantor will comply with all covenants,  conditions and restrictions
          set forth in the Loan Authorization and Guaranty Agreement.

                   (o)  During  the  term  of the  Loan,  each of  Borrower  and
          Guarantor will do all things  necessary to preserve and maintain their
          respective corporate existences in good standing and duly qualified to
          conduct  its  businesses  in the  States  of New  York  and  Delaware,
          respectively,  and with respect to Borrower,  the State of Texas; will
          not enter into any corporate mergers, reorganizations, restructures or
          liquidations  without the prior written  consent of Bank; not make any
          amendments  to its  articles of  incorporation  or bylaws  without the
          prior written consent of Bank, which consent shall not be unreasonably
          withheld or delayed;  and except for issuance of authorized  shares of
          stock to shareholders other than RTI which does not result in a change
          of more than 20~ of the ownership of Borrower, not allow or consent to
          a transfer  of any of its shares of stock  without  the prior  written
          consent of Bank.  Borrower  covenants  to give  thirty (30) days prior
          written  notice of any change in stock  ownership  allowed  under this
          Section 2 (a). As of the date hereof,  the shareholders,  officers and
          directors  of  Borrower  and  Guarantor  are as set forth in Exhibit D
          attached hereto and made a part hereof.

                    (p) As of the date hereof,  the Articles of Incorporation of
          Borrower  allow for the issuance of three  THOUSAND  (3,000) shares of
          stock and one hundred (100) shares are issued and outstanding.  During
          the term of the Loan, no additional shares of stock will be authorized
          or issued.

                     (s) During the term of this Loan,  Borrower  and  Guarantor
           will insure that Borrower  maintains a  satisfactory  efficiency  and
           safety   rating  from   Electronics   Testing  lab  and  an  American
           Refrigeration Institute listing, and contemporaneously with providing
           the quarterly financial statements to Bank as required hereunder will
           provide such evidence thereof as Bank may require.



<PAGE>






Page 7


           3. Loan Funding. The proceeds of the Loan shall be funded as follows,
to wit:

                     (a)  Interim  Loan.  At the time of closing of the Loan and
           subject  to the  satisfaction  of each of the  terms  and  conditions
           hereof and the  delivery  of each of the  Closing  Documents  and the
           other items described in Section 1 hereof required to be delivered by
           Borrower and Guarantors,  Bank will advance to Borrower the principal
           amount  of  Three   Hundred   Fifty   THOUSAND  and  No/100   Dollars
           ($350,000.00)  under the Note.  The  principal  balance  of the funds
           available  for  advance  under the Note in the amount of Two  Hundred
           Fifty  THOUSAND  and  No/100  Dollars   ($250,000.00)  shall  not  be
           disbursed  and Bank shall have no  obligation  to  disburse  the same
           unless within one hundred  twenty (120) days from the date of closing
           Borrower  has  (i)  secured  all  required   municipal,   regulatory,
           governmental  and third party  approvals  necessary  to vacate  those
           portions of the utility  easement  which are situated  underneath the
           building and other improvements on the Property and otherwise located
           on the Property in such a manner as may create an  impediment  to the
           use and operation of the Property,  (ii) caused such utility easement
           to be  vacated  of record in the  County  Clerk's  Records of El Paso
           County,  Texas,  and (iii) to the extent  required by applicable law,
           ordinance  or  regulation,  has filed an amended  plat of the Westway
           Unit II  subdivision to reflect the vacation  thereof.  Once Borrower
           has satisfied the foregoing  requirements with respect to the utility
           easement and provided such  evidence  with regards  thereto as may be
           required by Bank,  and provided that at such time no Event of Default
           has occurred  hereunder and no condition exists which with the giving
           of notice,  lapse of time, or both or otherwise would constitute such
           an Event of  Default,  the  balance of the  principal  available  for
           advance  under the Note will be  disbursed  to  Borrower.  Failure of
           Borrower  to  satisfy  the  foregoing  requirements  with  respect to
           vacation  of the  utility  easement  shall  constitute  and  Event of
           Default  under the terms of this Loan  Agreement and the terms of the
           Loan.

                    (b)  Minipermanent  Loan.  One hundred and twenty (120) days
          from the date hereof (the "Conversion  Date"),  provided  Borrower has
          complied with all of the terms and  conditions  set forth herein,  and
          provided further that no Event of Default then exists and no condition
          then exists which with the giving of notice,  lapse of time or both or
          otherwise would  constitute  such an Event of Default,  Bank agrees to
          convert the  interim  loan to a  mini-permanent  loan.  Following  the
          Conversion  Date,  the Loan shall  continue  to be secured by the Loan
          Documents and such other security  documents as Bank may require,  and
          shall be renewed,  extended  and  modified in  accordance  with either
          subparagraph (i) or (ii) below.

                             (i) With SBA.  Having  obtained the approval of the
           SEA and CDC and received the executed Loan Authorization and Guaranty
           Agreement,  and having received from the SEA a payment of $250,000 in
           reduction of the principal amount of the Loan, the Bank shall convert
           the  Loan  to  a  $350,000   mini-permanent   loan,   which  $350,000
           mini-permanent  loan will bear  interest  from the  Conversion  Date,
           prior to default or  maturity  at the rate or rates set forth  below.
           Commencing  as of the  Conversion  Date and  continuing  through  and
           including ten (10) years from the date  thereof,  the Loan shall bear
           interest on the principal  balance from time to time remaining unpaid
           under the Loan,  prior to default or maturity,  at the Prime Rate (as
           hereinafter  defined),  plus one and three quarters  percent (l.75'~)
           per annum (the "Applicable Rate provided, however, that



<PAGE>





Page 8


           if at any time the rate of  interest  which the Loan would  otherwise
           bear exceeds the highest  interest rate  permitted by applicable  law
           (the "Maximum Rate"), the rate of interest which the Loan bears shall
           be limited to the Maximum Rate.  Interest  shall be computed on a 360
           day year basis,  as if each year  consisted  of twelve (12) months of
           thirty (30) days each, but to the extent such computation of interest
           might cause the rate of interest  to exceed the  Maximum  Rate,  such
           interest shall be computed on the basis of a 365 day or 366 day year,
           as the case may be.

                     All past due principal or interest of the Loan  (compounded
           monthly)  shall bear interest from default or maturity  thereof until
           paid at the Maximum Rate, or in the absence of a Maximum Rate, at the
           rate of l8% per annum.

                    The  Prime  Rate  shall be the rate of  interest  per  annum
          quoted on a daily basis in The Wall Street Journal (Southwest Edition)
          as the  base  rate on  corporate  loans  at large  U.S.  money  center
          commercial  banks  (or  as  "Prime  Rate"  may  be  similarly  therein
          defined).  In the event more than one rate is quoted, or if a range or
          "spread" of rates is quoted,  then,  in such case,  the  highest  rate
          quoted shall be the "Prime Rate" for the purposes  hereof.  Such Prime
          Rate is currently  quoted under the "Money Rates" column for the prior
          business  day;  provided,  however,  for the purpose of the Loan,  the
          quoted  Prime  Rate  shall  be  effective  as of and for  the  date of
          publication of the issue of The Wall Street Journal in which the Prime
          Rate is quoted,  and not such prior  business day, and shall remain in
          effect until the Prime Rate is reset in accordance with the foregoing.
          In the event that The Wall Street  Journal  should cease  quoting such
          Prime  Rate,  then  Lender may refer to another  similar  source  that
          identifies the prime rate.

                    THE  PRIME  RATE  IS  USED AS A  DEVICE  TO SET THE  RATE OF
          INTEREST  ONLY;  IN NO EVENT IS IT TO BE  CONSTRUED  AS A WARRANTY  OR
          REPRESENTATION OF FAVORABILITY OF RATE OR A REPRESENTATION  THAT LOANS
          WILL NOT BE MADE AT LOWER RATES.

                    Principal   and   interest   shall  be  payable  in  monthly
          installments  (determined  as  hereinafter  provided),  with the first
          installment  of  principal  and interest to be due and payable one (1)
          month  from  the  Conversion  Date  and  subsequent   installments  of
          principal  and interest  being due and payable on the same day of each
          successive  month  thereafter until ten (10) years from the Conversion
          Date,  when the entire  balance of  principal  and  accrued and unpaid
          interest shall be due and payable.

                    The  initial  monthly   installment  (the  "Initial  Monthly
          Installment")  payable hereunder shall be determined on the Conversion
          Date and shall equal the monthly payment  required to repay the unpaid
          principal  amount  of  the  Note  on  the  basis  of a ten  (10)  year
          amortization  schedule (with year one (1) of the amortization schedule
          beginning  on the  Conversion  Date) at an interest  rate equal to the
          Applicable   Rate  on  the  Conversion   Date.  The  Initial   Monthly
          Installment  shall be payable  for  twelve  (12)  consecutive  months,
          commencing one (1) month from the Conversion Date. Thereafter, on each
          anniversary of the Conversion Date (each a "Change Date"),  Bank shall
          redetermine  the Applicable Rate as provided above and recalculate the
          amount of the monthly principal and interest  installments  based upon
          the then unpaid principal



<PAGE>


 Page 9


           balance hereof, at the Applicable Rate per annum on such Change Date,
           with the monthly  payments then being  calculated based on a ten (10)
           year  amortization,   less  the  number  of  years  lapsed  from  the
           Conversion   Date  to  such  Change  Date.   The   adjusted   monthly
           installments  as  determined on each Change Date shall be payable for
           the next twelve (12) months,  commencing  one (1) month from the date
           of each Change Date.

                             (ii) Without SEA. In the event that the approval of
           the SEA and CDC is not received and the SBA loan  contemplated by the
           Loan and  Authorization  Agreement  does not  close  and  result in a
           principal  reduction of the Loan in the amount of $250,000,  the Bank
           will convert the interim  construction loan to a mini-permanent  loan
           in the  maximum  amount of  $350,000  (the  "Maximum  Bank  Mini-Perm
           Amount")  upon  receipt,  within  fifteen  (15)  days  following  the
           Conversion  Date, of a principal  reduction on the Loan in the amount
           of $250,000.00,  plus accrued interest  thereon;  it being understood
           and agreed that the difference as of the Conversion  Date between the
           principal  amount  outstanding  under the Loan and the  Maximum  Bank
           Mini-Perm Amount (should this option (ii) be exercised) shall be paid
           in cash by Borrower as provided  herein as a condition  precedent  to
           Bank's obligations herein.

                    Thereafter,  the remaining unpaid  principal  balance of the
          Loan  (which in no event  shall  exceed  the  Maximum  Bank  Mini-Perm
          Amount) shall bear interest as provided in subparagraph  (i) above and
          shall be payable in consecutive principal and interest installments as
          determined in subparagraph (i) above.

                    In  connection   with  the  conversion  of  the  Loan  to  a
          mini-permanent  loan,  whether in  accordance  with the  provisions of
          subparagraph  (i) or subparagraph  (ii) above,  Borrower and Guarantor
          hereby  covenant and agree to execute any and all  renewal,  extension
          and modification agreements, guaranty agreements, affidavits, deeds of
          trust, assignments, security agreements and other collateral documents
          to further secure the Loan as Bank may require.
In the event that  neither the SEA  approval  and  principal  reduction  nor the
principal  reduction and interest  repayment as described in Section 3(b) (i) or
(ii) herein are received  within fifteen (15) days of the  Conversion  Date, the
Bank's  commitment  with  regards  to the  mini-permanent  loan  shall be deemed
terminated  and of no force  and  effect  and the Note  shall be  deemed to have
matured as of the Conversion Date.

4. Default.  The term  "default" as used herein shall mean the occurrence of any
one or more of the following events:

(a) Failure to pay any installment of principal or interest within ten (10) days
when due under the Note;

                    (b) Breach of any of the covenants  (other than the covenant
          to pay the Loan, the financial covenants or the covenant to vacate the
          utility  easement),  agreements or obligations  contained herein or in
          any instrument or document  mentioned herein other than the obligation
          to repay the Loan in accordance with its terms, and the continuance of
          such  breach for a period of fifteen  (15) days after  written  notice
          from Lender to Borrower specifying such breach;




<PAGE>

Page 10


                     (c) Breach of any one of the financial  covenants contained
           herein or failure to vacate the utility  easement  within one hundred
           twenty (120) days from the date of closing of the Loan;

                     (d) Finding by Lender that any statement, representation or
          warranty in this Agreement or in any  certificate  or document  herein
          mentioned  is untrue or  incorrect  in any  material  respect  and the
          failure  and  refusal  of  Borrower  or  Guarantor  to render the same
          immaterial or remedy it within  fifteen (15) days after written notice
          from Lender to Borrower specifying such breach;

(e)  Any  assignment  for  the  benefit  of  creditors  by the  Borrower  or the
Guarantor, or any one of them, or the adjudication of any one of the Borrower or
the Guarantor as an involuntary bankrupt;

(f) A material  adverse  change in the  financial  condition or the operation of
Borrower or Guarantor;

           (g)     Any event which results in acceleration of the SEA Loan;

(h) Filing by Borrower or Guarantor of a voluntary petition in bankruptcy;
                    
(i) Breach of any of the covenants,  agreements or obligations  contained in the
Loan Authorization and Guaranty Agreement; or
(j) The dissolution or other business failure of Borrower or Guarantor. Any sums
expended  by Lender  pursuant  to the  exercise  of any remedy  provided in this
Paragraph 4 shall be part of the indebtedness owing by Borrower to Lender.

          Should a default occur and be continuing, Lender may, at its election,
do any one or more of the following:

                    (a) Without  notice or grace  (except as expressly  provided
          for above),  notice of intent to accelerate,  notice of  acceleration,
          demand,  notice of intent to demand,  notice of demand or presentment,
          which are all hereby  expressly  waived,  declare the unpaid principal
          balance and accrued interest of the  indebtedness  immediately due and
          payable.

                    (b) So far as Borrower  and  Guarantor  are  concerned,  and
          without  notice to Borrower or Guarantors,  which is hereby  expressly
          waived,  take possession of the Property,  and at Lender's option,  in
          the name and on behalf of Borrower and  Guarantor,  do any one or more
          of the following: (i) assume the rights, powers and duties of Borrower
          and Guarantor under any contract entered into by them and (ii) pay all
          bills of, and settle or  compromise  any claims  against  Borrower and
          Guarantor.

                    (c)  Pursue  any  remedy  available  to  Lender at law or in
          equity,  including without limitation  foreclosure of the Vendor's and
          Deed of Trust liens against the Property,  institute collection of the
          Loan  against  Guarantor  or  exercise  any and all other  rights  and
          remedies  afforded Lender under the terms of the collateral  documents
          executed in connection with the Loan.



<PAGE>
                                                            Inc.

Page 11


                    5.     Miscellaneous.

                     (a) Any notice required or permitted  hereunder shall be in
           writing,  addressed to the party to be notified at the address stated
           below  (or at such  other  address  as may have  been  designated  by
           written notice), properly stamped, and deposited in the United States
           mail, as certified  mail,  return receipt  requested.  The address of
           each party for the purpose of this section is as follows:

Borrower:  Refrigeration Technology, Inc. Attn: Mr. James Caylor, Controller 301
Antone, P.O. Box 3048 Sunland Park, New Mexico 88063
                    
Lender: Norwest Bank El Paso, N.A. Attn: Mr. Joe Chavez Vice President 221 North
Kansas El Paso, Texas 79901
                    

Guarantor: RTI, Inc. Attn: Mr. Theo Muller, President 20 Peach Hill Road Darien,
Connecticut 06820

                    Any notice  given in  accordance  with this  Paragraph  5(a)
          shall be deemed  received upon delivery if by hand delivery or two (2)
          days after deposit in the U.S. Mail,  certified  mail;- return receipt
          requested.

                    (b) This Agreement has been made, and the Note and all other
          security  documents shall be made and executed in El Paso,  Texas; and
          all advances in respect of the Loan, and all payments  thereon,  shall
          be made in Texas.  This  Agreement,  the Note and all  other  security
          documents  shall be  governed by the laws of the State of Texas in all
          respects, including matters of construction, validity and performance.

                    (c) This  Agreement  shall not be assignable by operation of
          law or otherwise without written consent of Lender.

                    (d) This Agreement shall be binding upon, and shall inure to
          the benefit of Lender, its successors and assigns and shall be binding
          upon   Borrower   and   Guarantor   and   their   respective    heirs,
          representatives, successors and assigns.

(e) Time is of the essence with respect to performance of this Agreement.

                    (f) Should  Borrower fail to perform any  covenant,  duty or
          agreement in accordance with the terms  hereunder,  Lender may, at its
          election,  perform  or  attempt  to  perform  such  covenant,  duty or
          agreement on behalf of  Borrower.  Borrower  shall,  at the request of
          Lender, promptly pay any amount expended by Lender in such performance
          or attempted performance to Lender,  together with interest thereon at
          the rate of  eighteen  percent  (18%) per annum  from the date of such
          expenditure by Lender until paid, provided,  however, that Lender does
          not assume and shall never have, except




<PAGE>



Page 12


           by written agreement of Lender,  any liability for the performance of
           any duties of Borrower under or in connection with all or any part of
           the Property described above.

                    (g)  Failure  by  Lender  to  exercise  any  right  or power
           accruing  hereunder  shall  not  impair  such  right  or  power or be
           construed to be a waiver of any other  breach or any other  covenant,
           condition or agreement herein contained.

                    (h) Anything herein contained to the contrary, Borrower does
           not agree and shall not be  obligated  to pay any amount  which would
           render this  obligation  usurious.  It is the  intention of Lender to
           conform  strictly  to  applicable  usury  laws now in  force  and any
           agreement  for interest  shall be held to be subject to the reduction
           to the  amount  allowed  under  such  usury  laws so that if from any
           circumstances  any interest is in excess of the maximum  permitted by
           law such excess shall be canceled  automatically  and if thereto fore
           paid  shall  be  refunded  or  credited  on  the   principal   amount
           outstanding.  The  Loan  has  been  made on the  assumption  that all
           scheduled  payments  will be  made  when  due,  and in the  event  of
           prepayment and/or  accelerated  maturity from any cause, any interest
           paid on  account of the Loan in excess of the  Maximum  Rate shall be
           considered for all purposes as payment on principal. All sums paid or
           agreed  to be paid  for the use,  forbearance,  or  detention  of the
           indebtedness  evidenced by the Loan shall, to the extent permitted by
           applicable  law,  be  amortized,   prorated,  allocated,  and  spread
           throughout the full term of the Loan until payment in full.

                    (i) It is understood and agreed that all approvals  given by
          Lender to any  instruments  or documents and all  inspections  made by
          Lender shall be given and made solely to protect Lender's  collateral.
          IN NO EVENT SHOULD BORROWER RELY ON LENDER'S  APPROVALS OR INSPECTIONS
          FOR PROTECTION OF BORROWER, OR THE PROPERTY.

                     (j) This Loan Agreement and all documents to be executed in
          connection  herewith are to be governed by and construed in accordance
          with the laws of the State of Texas and the United  States of America.
          The jurisdiction and venue of all litigation,  bankruptcy  actions and
          other  legal  proceeding  involving  the  Property  or any of the Loan
          Documents shall be in El Paso County, Texas.

                    (k)  Except for "Core  Proceedings"  as such term is defined
          under the United States  Bankruptcy Code, Lender and Borrower agree to
          submit to binding  arbitration all claims,  disputes and controversies
          between or among them,  whether in tort,  contract or  otherwise  (and
          their respective employees, officers, directors,  attorneys, and other
          agents)  arising out of or  relating to in any way (i) the Loan,  this
          Loan Agreement and the related loan and security  documents  which are
          the   subject   of  the   Note   and   its   negotiation,   execution,
          collateralization, administration, repayment, modification, extension,
          substitution,   formation,   inducement,   enforcement,   default   or
          termination;  or (ii) requests for additional  credit. Any arbitration
          proceeding will (i) proceed in El Paso, Texas; (ii) be governed by the
          Federal Arbitration Act (Title 9 of the United States Code); and (iii)
          be conducted in accordance  with the Commercial  Arbitration  rules of
          the American Arbitration Association ("AAA")




<PAGE>


Page 13


                    The  arbitration  requirement  does not  limit  the right of
           either  party to Ci)  foreclose  against  real or  personal  property
           collateral;  (ii) exercise  self-help remedies relating to collateral
           or proceeds of collateral  such as setoff or  repossession;  or (iii)
           obtain provisional  ancillary  remedies such as replevin,  injunctive
           relief, attachment or the appointment of a receiver, before during or
           after the pendency or any arbitration proceeding. This exclusion does
           not constitute a waiver of the right or obligation of either party to
           submit any dispute to  arbitration,  including those arising from the
           exercise of the actions  detailed in section  Ci),  (ii) and (iii) of
           this paragraph.

                 Any arbitration proceeding will be before a single arbitrator
          selected according to the Commercial Arbitration Rules of the AAA. The
          arbitrator will determine  whether or not an issue is arbitratable and
          will give effect to the  statutes of  limitation  in  determining  any
          claim.  Judgment  upon the award  rendered  by the  arbitrator  may be
          entered in any court having jurisdiction.

                   In any arbitration  proceeding the arbitrator will decide (by
          documents only or with a hearing at the  arbitrator's  discretion) any
          pre-hearing  motions  which are  similar to  motions  to  dismiss  for
          failure to state a claim or motions for summary adjudication.

                    In any  arbitration  proceeding  discovery will be permitted
          and will be  governed  by the  Texas  Rules of  Civil  Procedure.  All
          discovery  must be  completed no later than 20 days before the hearing
          date  and  within  180  days  of  the   commencement   of  arbitration
          proceedings.  Any requests for an extension of the discovery  periods,
          or any discovery  disputes,  will be subject to final determination by
          the arbitrator.

          If the  foregoing  terms are  acceptable  to Borrower  and  Guarantor,
please indicate your acceptance below by your signature.

                                                               Yours very truly,

                           NORWEST BANK EL PASO, N.A.

                         By: Joe Chaver, Vice President

           Accepted this 8th day of October, 1997.


                   REFRIGERATION TECHNOLOGY INC., a Delaware corporation

                                   By: Rick Bacchus, President


                        RTI Inc., a New York corporation

                     by: Rick Bacchus, President, Guarantor