Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as of this
13th day of October, 2015, by and between ARGAN, INC., a Delaware corporation
(the “Company”); and (ii) DAVID H. WATSON (the “Executive”).

 

RECITALS:

 

R-1.                         The Company wishes to employ the Executive as its
Senior Vice President and Chief Financial Officer and the Executive wishes to
accept such employment and to perform such services for the Company; and

 

R-2.                         The parties wish to enter into this Agreement to
set forth the terms of the Executive’s employment by the Company, as set forth
hereinafter.

 

NOW, THEREFORE, in consideration of the foregoing premises, the mutual promises
and covenants set forth herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:

 

1.                                      Employment.  The Company hereby agrees
to employ the Executive, and the Executive hereby agrees to accept such
employment, subject to the terms and conditions set forth in this Agreement. 
This Agreement supersedes and replaces any previous oral or written agreement
concerning the Executive’s employment by the Company.

 

2.                                      Duties of the Executive.  During the
“Term” (as defined below) of employment of the Executive, the Executive shall
serve as the Senior Vice President and Chief Financial Officer of the Company,
and shall faithfully and diligently perform all services as may be assigned to
him by the Chairman of the Board (the “Chairman”) or the Board of Directors of
the Company (the “Company Board”), and shall exercise such power and authority
as may from time to time be delegated to him by the Company Board.  The
Executive shall perform his duties at the principal offices of the Company, with
travel to such other locations from time to time as the Chairman and/or the
Company Board may reasonably prescribe. Except as may otherwise be approved in
advance by the Chairman and/or the Company Board, and except during vacation
periods and personal days and reasonable periods of absence due to sickness,
personal injury or other disability, the Executive shall devote his full time
throughout the Term to the services required of him hereunder. The Executive
shall render his services exclusively to the Company during the Term to the best
of his ability, and use his best efforts to promote the interests of the Company
and its subsidiaries and affiliates.

 

3.                                      Term of Employment.  Employment of the
Executive pursuant to the terms and provisions of this Agreement shall commence
on October 15, 2015 and shall continue until April 30, 2017 (the “Initial
Term”), unless earlier terminated as provided in this Agreement.  At the end of
the Initial Term, the Executive’s employment hereunder shall automatically renew
for successive one year terms (each, a “Renewal Term”), subject to earlier
termination as provided in this Agreement, unless the Company or the

 

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Executive delivers written notice to the other at least sixty (60) days prior to
the expiration date of the Initial Term or any Renewal Term, as the case may be,
of its or his election not to renew the term of employment.  The period during
which the Executive shall be employed by the Company pursuant to the terms and
provisions of this Agreement is sometimes referred to herein as the “Term.”

 

4.                                      Compensation.

 

4.1                               Salary.  The Company shall pay the Executive
compensation at the annual rate of $200,000 (the “Salary”) during the Initial
Term, which may be adjusted from time to time in such amounts as the Company
may, in its reasonable discretion, deem to be appropriate, payable in
installments consistent with the Company’s normal payroll schedule, subject to
applicable withholding and other taxes.

 

4.2                               Bonus.  In addition to the Salary set forth in
Section 4.1, for each fiscal year of the Company occurring within, or partially
within, the Term, the Executive shall be eligible to receive an annual bonus in
the sole discretion of the Company Board, subject to satisfaction of such
reasonable performance criteria as may be established for the Executive with
respect to such year.

 

5.                                      Benefit Plans.  The Executive shall be
eligible to participate in all health, retirement and insurance benefit plans
applicable to executive employees of the Company, and such other plans as may
from time to time be made available or applicable to the Company, in accordance
with the provisions of such plans and consistent with the policies of the
Company.

 

6.                                      Vacation.  The Executive shall be
entitled to annual paid vacation in accordance with the Company policy that may
be applicable to executive employees from time to time.  Vacation shall accrue
on a pro rata basis during the course of each year during the Term.  As of the
date of this Agreement, it is the Company’s written policy that accrued but
unused vacation is forfeited at the end of each fiscal year of the Company and
at termination of employment for any reason.

 

7.                                      Expenses.  The Company shall reimburse
the Executive, consistent with the Company’s expense reimbursement policies and
procedures and subject to receipt of appropriate documentation, for all
reasonable and necessary out-of-pocket travel, business entertainment, and other
business expenses incurred or expended by the Executive incident to the
performance of his duties hereunder.

 

8.                                      Stock Plans and Options.  During the
Term, the Executive shall be eligible to participate in any stock option,
incentive and similar plans established by the Company from time to time and at
any time, subject in all cases to the satisfaction by the Executive of the terms
and conditions of such plans and to the reasonable exercise by the Company Board
of any discretion granted to it thereunder.

 

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9.                                      Termination of Employment.

 

9.1                               For Cause.  The Company may terminate the
Executive’s employment at any time for “Cause” (as defined below).  For the
purposes of this Agreement, “Cause” shall mean (i) habitual drunkenness or any
substance abuse which adversely affects the Executive’s performance of his job
responsibilities; (ii) any illegal use of drugs; (iii) commission of a felony
(including, without limitation, any violation of the Foreign Corrupt Practices
Act); (iv) dishonesty materially relating to the Executive’s employment; (v) any
misconduct by the Executive which would cause the Company or any of its
subsidiaries or affiliates to violate any state or federal law relating to
sexual harassment or age, sex or other prohibited discrimination, or any
intentional violation of any written policy of the Company adopted with respect
to any such law; (vi) any other conduct in the performance of the Executive’s
employment which the Executive knows or should know (either as a result of a
prior warning by the Company, custom within the industry or the flagrant nature
of the conduct) violates applicable law or causes the Company or any of its
subsidiaries or affiliates to violate applicable law in any material respect;
(vii) failure to follow the lawful written instructions of the Company Board, if
such failure continues uncured for a period of ten (10) days after receipt by
the Executive of written notice from the Company stating that continuation of
such failure would constitute grounds for termination for Cause; (viii) any
violation of the confidentiality or non-solicitation provisions hereof; or
(ix) any other material violation of this Agreement.

 

9.2                               Upon Death or Disability.  The employment of
the Executive shall automatically terminate upon the death of the Executive and
may be terminated by the Company upon the “Disability” (as defined below) of the
Executive.  For purposes of this Section 9.2, the Executive shall be deemed
“Disabled” (and termination of his employment shall be deemed to be due to such
“Disability”) if an independent medical doctor (selected by the Company’s
applicable health or disability insurer) certifies that the Executive, for a
cumulative period of more than 180 days during any 365-day period, has been
disabled in a manner which seriously interferes with his ability to perform the
essential functions of his job even with a reasonable accommodation to the
extent required by law.  Any refusal by the Executive to submit to a medical
examination for the purpose of certifying Disability shall be deemed
conclusively to constitute evidence of the Executive’s Disability.

 

9.3                               For Convenience of the Company. 
Notwithstanding any other provisions of this Agreement, the Company shall have
the right, upon sixty (60) days written notice to the Executive, to terminate
the Executive’s employment at the “Company’s Convenience” (i.e., for reasons
other than Cause, resignation for reasons other than “Good Reason” [as defined
below], death or Disability).  For purposes hereof, resignation by the Executive
for Good Reason also shall be deemed to constitute termination by the Company at
the Company’s Convenience.

 

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9.4                               Resignation; Good Reason.

 

(a)                                 The Executive shall have the right to resign
at any time upon sixty (60) days’ written notice to the Company.

 

(b)                                 For the purposes of this Agreement,
resignation by the Executive as a result of the following shall be deemed to
constitute resignation for “Good Reason,” provided that and on condition that
the Executive has not consented to the action constituting Good Reason and such
resignation occurs within 15 days following the occurrence of such action (or,
in the case of clause (ii) below, following the expiration of the 45-day cure
period), and that the Executive is not Disabled (or incapacitated in a manner
which would, with the passage of time and appropriate doctor’s certification,
constitute Disability) at the time of resignation: (i) a material adverse change
made by the Company to the Executive’s duties, responsibilities and/or working
conditions such that such duties, responsibilities and/or working conditions are
inappropriate and not customary for a chief financial officer of a similarly
situated company, or (ii) a material breach by the Company of this Agreement,
which breach continues uncured for a period of 45 days after receipt by the
Company of written notice thereof from the Executive specifying the breach.

 

10.                               Effect of Termination on Compensation.

 

10.1  Termination for Cause; Resignation.  In the event (i) the Executive’s
employment with the Company is terminated by the Company for Cause, or (ii) the
Executive resigns (for reasons other than Good Reason), the Company shall have
no further liability to the Executive hereunder, whether for Salary, benefits,
or otherwise, other than for Salary and benefits accrued, reimbursement of
expenses properly incurred, payment for all accrued vacation calculated in
accordance with the Company’s standard payroll practices, in each case through
the date of termination or resignation, and any other benefits required by
applicable law (e.g., COBRA) for which the Executive may be eligible.

 

10.2  Death or Disability.  In the event the Executive’s employment with the
Company terminates as a result of the death of the Executive or is terminated by
the Company as a result of the Disability of the Executive, the Executive or, in
the event of his death, his surviving spouse (or his estate, if there is no
surviving spouse), shall be entitled to receive his Salary and benefits accrued,
reimbursement of expenses properly incurred, and payment for all accrued
vacation calculated in accordance with the Company’s standard payroll practices,
in each case through the date of termination, as well as applicable health,
disability or death benefits, if any, offered by the Company at the time
consistent with the policies of the Company and subject to the eligibility
requirements of such benefits.

 

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10.3.                     The Company’s Convenience or Good Reason.

 

(a)                                 In the event the Executive’s employment with
the Company is terminated by the Company at the Company’s Convenience or by the
Executive for Good Reason, then the Executive shall be entitled to (i) continue
to receive his Salary for the period of six (6) months following the date the
Executive’s employment so terminates, and (ii) continue to participate in the
Company’s health and benefit plans and programs described in Section 5 other
than the Company’s 401(k) plan(s) and any other qualified retirement
plan(s) (and specifically excluding the vacation benefit described in Section 6,
which will terminate as of the date the Executive’s employment so terminates)
for the period of six (6) months following the date the Executive’s employment
so terminates, or, in the case of the Company’s health plan(s), until the
Executive becomes eligible for health insurance from another source other than
Medicare (e.g., another employer’s health insurance program), if earlier;
provided that such continued participation during such period does not cause a
plan, program or practice to cease to be qualified under any applicable law or
regulation and is permitted by the plan or program, and that continuation under
any such plan, program or practice shall be limited to benefits customarily
provided by the Company to its senior executives during the period of such
continuation, and provided further that any such plan or program shall be
subject to modifications applicable to executive-level employees generally.  The
compensation, allowances and benefits described in the foregoing provisions of
this Section 10.3(a) (“Severance Benefits”) shall continue to be paid or
provided at the times and in the manner consistent with the standard payroll
practices of the Company for its active executive-level employees.  In addition,
the Executive shall be entitled to receive his salary and benefits accrued,
reimbursement of expenses properly incurred and payment for all accrued vacation
calculated in accordance with the Company’s standard payroll practices, in each
case through the date of termination.  Except as provided in this Section, no
other compensation or benefits hereunder shall be payable during the balance of
the Term.

 

(b)                                 As a condition to receiving the Severance
Benefits described in clause (a) above, the Executive shall be required to
execute and deliver to the Company, and not to have revoked, the written
confirmation described in Section 11 and a general release of all claims the
Executive may have against the Company and its subsidiaries and affiliates, and
their respective officers, directors, shareholders, managers, members and
agents, in each case in such form as may be reasonably requested by the Company,
including without limitation all claims for wrongful termination, for employment
discrimination under Title VII of the Civil Rights Act of 1964, as amended, and
claims under the Americans with Disabilities Act of 1990, the Equal Pay Act of
1963, the Age Discrimination in Employment Act of 1967, the Older Workers
Benefit Protection Act of 1990, the Civil Rights Act of 1866, the Family and
Medical Leave Act of 1993, the Civil Rights Act of 1991, the Executive
Retirement Income Security Act of 1974, and any equivalent state, local and
municipal laws, rules and regulations).  Notwithstanding the foregoing, the
Executive shall not be required to release any claims (i) for unpaid
compensation or other benefits remaining unpaid by the Company at the time of
termination, but may be required to agree upon and acknowledge the amount, if
any, thereof remaining unpaid if such amount is calculable at the time, and
(ii) which the

 

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Executive may have in connection with any unexercised options to purchase common
stock of the Company granted to the Executive under and pursuant to any stock
option plan maintained by the Company from time to time hereinafter.

 

(c)                                  Upon the occurrence of any material breach
of this Agreement after the effective date of employment termination (it being
understood that, without limitation, any breach of Sections 11, 12 or 13 of this
Agreement shall be deemed material), the Company shall have no further liability
to pay Severance Benefits hereunder and may, in addition to exercising any other
remedies it may have hereunder or under law, immediately discontinue payment of
remaining unpaid Severance Benefits.

 

10.4                        Adjustments to Comply with American Jobs Creation
Act.  In the event any of the severance payment provisions of this
Section should prove to be inconsistent with the requirements of Section 409A of
the Internal Revenue Code of 1986, as amended, or the regulations thereunder,
the Company and the Executive shall endeavor to amend those severance payment
provisions in order to eliminate any inconsistency with Section 409A while
ensuring, to the greatest extent possible, that the Executive will continue to
be entitled to the benefits provided under this Agreement without increase in
the economic cost to either party.

 

11.                               Confidentiality.  The Executive recognizes and
acknowledges that certain information possessed by the Company, and its
subsidiaries and affiliates, constitutes valuable, special, and unique
proprietary information and trade secrets.  Accordingly, the Executive shall
not, during the Term of his employment with the Company, or at any time
thereafter, divulge, use, furnish, disclose or make available to any person,
whether or not a competitor of the Company or any of its subsidiaries or
affiliates, any confidential or proprietary information concerning the assets,
business, or affairs of the Company or any of its subsidiaries or affiliates, or
of its or their suppliers, customers, licensees or licensors, including, without
limitation, any information regarding trade secrets and information (whether or
not constituting trade secrets) concerning sources of supply, costs, pricing
practices, financial data, business plans, employee information, manufacturing
processes, product designs, production applications and technical processes
(hereinafter called “Confidential Information”), except as may be required by
law or as may be required in the ordinary course of performing his duties
hereunder.  The foregoing shall not be applicable to any information which now
is or hereafter shall be in the public domain other than through the fault of
the Executive.  Upon the expiration or termination of the Executive’s
employment, for any reason, whether voluntary or involuntary and whether by the
Company or the Executive, or at any time the Company may request, the Executive
shall (a) surrender to the Company all documents and data of any kind (including
data in machine-readable form) or any reproductions (in whole or in part) of any
items relating to the Confidential Information, as well as information stored in
an electronic or digital format, containing or embodying Confidential
Information, including without limitation internal and external business forms,
manuals, notes, customer lists, and computer files and programs (including
information stored in any electronic or digital format), and shall not make or
retain any copy or extract of any of the foregoing, and (b) will confirm in
writing that (i) no Confidential Information exists on

 

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any computers, computer storage devices or other electronic media that were at
any time within the Executive’s control (other than those which remain at, or
have been returned to, the Company), and (ii) he has not disclosed any
Confidential Information to others outside of the Company or any of its
subsidiaries or affiliates in violation of this Section.  The Company shall have
the right at any time at its option to replace the hard drive in the Executive’s
laptop or other computer, if any, supplied by the Company with another
equivalent hard drive.  As used in this Agreement, “affiliate” means, with
respect to the Company or any other entity, any person or entity controlling,
controlled by or under common control with, the Company or such other entity,
and “control” for such purpose means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies of a
person or entity, whether through the ownership of voting securities or voting
interests, by contract or otherwise.

 

12.                               Rights in the Company’s Property; Inventions.

 

12.1                        Company Property.  The Executive hereby recognizes
the Company’s proprietary rights in the tangible and intangible property of the
Company and acknowledges that notwithstanding the relationship of employment,
the Executive will not obtain or acquire, and has not obtained or acquired,
through such employment any personal property rights in any of the property of
the Company or any of its subsidiaries or affiliates, including without
limitation any writing, communications, manuals, documents, instruments,
contracts, agreements, files, literature, data, technical information, secrets,
formulas, products, methods, mailing lists, business models, business plans,
procedures, processes, devices, apparatuses, trademarks, trade names, trade
styles, service marks, logos, copyrights, patents, or other matters which are
the property of any of the Company.

 

12.2                        Inventions.  The Executive agrees that any and all
discoveries, inventions, improvements and innovations (including all data and
records pertaining thereto) (“Inventions”), whether or not patentable,
copyrightable or reduced to writing, which the Executive may have conceived or
made, or may conceive or make, during the Term of his employment with the
Company and for a period of three (3) months thereafter, either alone or in
conjunction with others and whether or not during working hours or by the use of
the facilities of the Company or any of its subsidiaries or affiliates, which
are related or in any way connected with the business of the Company or any of
its subsidiaries or affiliates are and shall be the sole and exclusive property
of the Company, or such affiliate or subsidiary thereof, as the case may be. 
The Executive shall promptly disclose all such Inventions to the Company, shall
execute at the request of the Company any assignments or other documents the
Company may deem necessary to protect or perfect its or any of its affiliates’
or subsidiaries’ rights therein, and shall assist the Company, at the Company’s
expense, in obtaining, defending and enforcing the Company’s, or any of its
subsidiaries’ or affiliates’, rights therein.  The Executive hereby appoints the
Company as his attorney-in-fact to execute on his behalf any assignments or
other documents deemed necessary by the Company to protect or perfect its, or
any of its affiliates’ or subsidiaries’, rights to any Inventions.

 

13.                               Non-Solicitation Covenant.  At all times
during the Term and for a

 

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period of two (2) years after the Term (the “Restrictive Period”), the Executive
shall not, directly or indirectly, for himself or for any other person or
entity: (a) solicit for employment, employ or attempt to employ or enter into
any contractual arrangement with any employee or former employee (which, for
purposes of this Section 13 shall mean anyone employed during the 24 month
period ending on the date of termination of the Executive’s employment with the
Company) of the Company, or any of its affiliates or subsidiaries; and/or
(b) call on or solicit any of the actual or targeted prospective customers or
clients, or any actual distributors or suppliers, of the Company, or any of its
affiliates or subsidiaries, on behalf of himself or on behalf of any person or
entity in connection with any business that competes with the business of the
Company or any of its affiliates or subsidiaries, nor shall the Executive make
known the names or addresses or other contact information of such actual or
prospective customers or clients, or any such actual distributors or suppliers,
or any information relating in any manner to the Company’s, or any of its
affiliates’ or subsidiaries’, trade or business relationships with such actual
or prospective customers or clients, or any such actual distributors or
suppliers, other than in connection with the performance by the Executive of his
duties under this Agreement.

 

14.                               Enforcement; Modification.

 

14.1                        Acknowledgement; Injunction.  The Executive
acknowledges and confirms that the restrictions contained in Sections 11, 12 and
13 hereof (including without limitation the lengths of the terms of the
provisions thereof) are required by the Company as an inducement to enter into
this Agreement, are reasonably necessary to protect the legitimate business
interests of the Company, and are not overbroad, overlong, or unfair and are not
the result of overreaching, duress or coercion of any kind.  The Executive
further acknowledges that the restrictions contained in Sections 11, 12 and 13
hereof are intended to be, and shall be, for the benefit of and shall be
enforceable by the Company and its successors and assigns.  The Executive
expressly agrees that upon any breach or violation of the provisions of Sections
11, 12, or 13 hereof, the Company shall be entitled, as a matter of right, in
addition to any other rights or remedies it may have, to: (a) temporary and/or
permanent injunctive relief in any court of competent jurisdiction (without
posting a bond or other security); and (b) such damages as are provided at law
or in equity.  The existence of any claim or cause of action against the Company
or any of its affiliates or subsidiaries, whether predicated upon this Agreement
or otherwise, shall not constitute a defense to the enforcement of any of the
restrictions contained in Sections 11, 12 or 13 hereof.

 

14.2                        Reformation by Court.  In the event that a court of
competent jurisdiction shall determine that any provision of Sections 11, 12 or
13 is invalid or more restrictive than permitted under the governing law of such
jurisdiction, then only as to enforcement of Sections 11, 12 or 13 within the
jurisdiction of such court, such provision shall be interpreted or reformed and
enforced as if it provided for the maximum restriction permitted under such
governing law.

 

14.3                        Extension of Time.  If the Executive shall be in
violation of any

 

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provision of Sections 11, 12 or 13, then each time limitation set forth in
Sections 11, 12 or 13 shall be extended for a period of time equal to the period
of time during which such violation or violations occur.  If the Company seeks
injunctive relief from such violation in any court, then the covenants set forth
in Sections 11, 12 and 13 shall be extended for a period of time equal to the
pendency of such proceeding including all appeals by either of the Sellers.

 

14.4                        Survival.  The provisions of Sections 11, 12 and 13,
and of this Section 14, shall survive the termination of this Agreement.

 

15.                               Assignment.  The Company shall have the right
to assign this Agreement and its rights and obligations hereunder to any
corporation or other entity with or into which the Company may hereafter merge
or consolidate or to which the Company may transfer all or substantially all of
its assets, if in any such case said corporation or other entity shall by
operation of law or expressly in writing assume all obligations of the Company
hereunder as fully as if it had been originally made a party hereto, but may not
otherwise assign this Agreement or its rights and obligations hereunder.  The
Executive may not assign or transfer this Agreement or any rights or obligations
hereunder.

 

16.                               Benefits; Binding Effect.  This Agreement
shall be for the benefit of and binding upon the parties hereto and their
respective heirs, personal representatives, legal representatives, successors
and, where permitted and applicable, assigns, including, without limitation, any
successor to the Company, whether by merger, consolidation, sale of stock, sale
of assets or otherwise.

 

17.                               Severability.  The invalidity of any one or
more of the provisions of this Agreement shall not affect the enforceability of
the remaining portions of this Agreement or any part thereof, all of which are
inserted conditionally on their being valid in law, and, in the event that any
one or more of the provisions of this Agreement shall be declared invalid, this
Agreement shall be construed as if such invalid provisions had not been
inserted.

 

18.                               Waivers.  The waiver by either party hereto of
a breach or violation of any term or provision of this Agreement shall not
operate nor be construed as a waiver of any subsequent breach or violation.

 

19.                               Damages; Attorneys Fees.  Nothing contained
herein shall be construed to prevent the Company or the Executive from seeking
and recovering from the other damages sustained as a result of the other’s
breach of any term or provision of this Agreement.  In the event that either
party hereto seeks to collect any damages resulting from, or the injunction of
any action constituting, a breach of any of the terms or provisions of this
Agreement, then the party found to be at fault shall pay all reasonable costs
and attorneys’ fees of the other party.

 

20.                               Section Headings.  The article, section and
paragraph headings contained

 

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in this Agreement are for reference purposes only, and shall not affect in any
way the meaning or interpretation of this Agreement.

 

21.                               No Third Party Beneficiary.  Nothing expressed
or implied in this Agreement is intended, or shall be construed, to confer upon
or give any person other than the parties hereto and their respective heirs,
personal representatives, legal representatives, successors and permitted
assigns, any rights or remedies under or by reason of this Agreement.

 

22.                               Counterparts; Execution by E-mail.  This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original but all of which together shall constitute one and the
same.  The parties agree that the transmission of this document executed by a
party by electronic means (e-mail) shall constitute a binding original document.

 

23.                               Governing Law.  This Agreement shall be
governed by and construed and enforced in accordance with the internal laws of
the State of Maryland, without regard to principles of conflict of laws.

 

24.                               Jurisdiction and Venue.  Each of the parties
irrevocably and unconditionally:  (a) agrees that any suit, action or legal
proceeding arising out of or relating to this Agreement which is expressly
permitted by the terms of this Agreement to be brought in a court of law, shall
be brought in the Circuit Court for Montgomery County, Maryland, or in the
United States District Court for the District of Maryland; (b) consents to the
jurisdiction of each such court in any such suit, action or proceeding;
(c) waives any objection which it or he may have to the laying of venue of any
such suit, action or proceeding in any of such courts; and (d) agrees that
service of any court papers may be effected on such party by mail, as provided
in this Agreement, or in such other manner as may be provided under applicable
laws or court rules in such courts.

 

25.                               Notices.  All notices required or permitted to
be given hereunder shall be in writing and shall be personally delivered by
courier, sent by registered or certified mail, return receipt requested, sent by
overnight courier, or sent by confirmed facsimile transmission addressed as set
forth herein.  Notices personally delivered, sent by facsimile or sent by
overnight courier shall be deemed given on the date of delivery and notices
mailed in accordance with the foregoing shall be deemed given upon the earlier
of receipt by the addressee, as evidenced by the return receipt thereof, or
three days after deposit in the U.S. mail.  Notice shall be sent: (a) if to the
Company, addressed to the Company at One Church Street, Suite 201, Rockville,
Maryland 20850, Attention: Rainer Bosselmann; and (b) if to the Executive, to
his address as reflected on the payroll records of the Company, or to such other
address as either party shall request by notice to the other in accordance with
this provision.

 

26.                               Entire Agreement.  This Agreement constitutes
the entire agreement between the parties hereto with respect to the subject
matter hereof and shall supersede all prior agreements, understandings and
arrangements, both oral and written, between

 

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the Executive and the Company with respect to such subject matter.  This
Agreement may not be modified in any way unless by a written instrument signed
by the Company and the Executive.

 

[Signatures on following page]

 

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IN WITNESS WHEREOF, each of the undersigned has executed, or has caused its duly
authorized representative to execute, this Agreement as of the date first above
written.

 

 

 

THE COMPANY:

 

 

 

ARGAN, INC.

 

 

 

 

 

By:

/s/ Rainer H. Bosselmann

 

 

Name:

Rainer H. Bosselman

 

 

Title:

Chairman and CEO

 

 

 

 

 

THE EXECUTIVE:

 

 

 

 

 

/s/ David H. Watson

 

DAVID H. WATSON

 

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