STOCK PURCHASE AGREEMENT
 
By and Among
 
ARGAN, INC.
 
and
 
GEMMA POWER, INC., and
GEMMA POWER SYSTEMS CALIFORNIA, INC.

and
 
WILLIAM F. GRIFFIN, JR. and JOEL M. CANINO
 

--------------------------------------------------------------------------------

STOCK PURCHASE AGREEMENT
 
THIS STOCK PURCHASE AGREEMENT (this “Agreement”) is made and entered into as of
this 8th day of December, 2006, by and among (i) ARGAN, INC., a Delaware
corporation (“Purchaser”), (ii) GEMMA POWER, INC., a Connecticut corporation
(“GPS-Connecticut”), (iii) GEMMA POWER SYSTEMS CALIFORNIA, INC., a California
corporation (“GPS-California,” and, together with GPS-Connecticut, the
“Corporations”), and (iv) WILLIAM F. GRIFFIN, JR. (“Griffin”), and (v) JOEL M.
CANINO (“Canino,” and together with Griffin sometimes hereinafter referred to
together as, the “Sellers”).

INTRODUCTORY STATEMENT
 
A. The Sellers own a majority of the issued and outstanding shares of capital
stock of GPS-Connecticut, and all of the issued and outstanding shares of
capital stock of GPS-California.

B. GPS-Connecticut and GPS-California are engaged in the engineering and
construction of power energy systems and also provide consulting, owner’s
representative, operating, and maintenance services to the energy market.

C. The Boards of Directors of Purchaser and of GPS-Connecticut and
GPS-California have approved the acquisition of the Corporations by Purchaser by
acquisition (i) from the Sellers and the Other Stockholders of all of the
GPS-Connecticut Stock, and from the Sellers of all of the GPS-California Stock,
upon the terms and subject to the conditions set forth herein.

D. For federal income tax purposes, it is intended that the acquisition of
GPS-Connecticut and GPS-California shall qualify as a tax-free reorganization
within the meaning of Section 368(a)(1)(B) of the Internal Revenue Code of 1986,
as amended (the “Code”), and for such purpose the parties have adopted the Plan
of Reorganization in the form of the Plan of Reorganization attached hereto as
Exhibit D.

NOW, THEREFORE, for and in consideration of the premises and the mutual
representations, warranties, covenants and agreements herein contained and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties do agree as follows:

DEFINITIONS
 
The following terms when used in this Agreement shall have the following
meanings:

“Act” shall mean the Securities Act of 1933, as the same has been and shall be
amended from time to time.
 

--------------------------------------------------------------------------------

“Argan Per Share Value” shall mean Three and 75/100 Dollars ($3.75) per share,
being the same price per share as that paid by investors for Argan Common Stock
in connection with that certain private offering of up to 2,900,000 shares of
Argan Common Stock to a limited number of sophisticated investors pursuant to
that certain Stock Purchase Agreement dated as of December 7, 2006, by and among
Argan and the Buyers identified therein, and that certain Escrow Agreement dated
as of December 7, 2006, by and among Argan, the Buyers identified therein and
the escrow agent identified therein.

“Argan Common Stock” shall mean the authorized voting common stock of Argan.

“Business Day” shall mean shall mean any day of the week other than Saturday,
Sunday or a day on which banking institutions in either New York, New York, or
Washington, D.C., are obligated or authorized by law to close.

“Canino” shall mean Joel M. Canino, a stockholder, officer and director of
GPS-Connecticut and of GPS-California, and a signatory to this Agreement.
 
“Closing” means the transfer of the GPS-Connecticut Stock and the GPS-California
Stock to Purchaser and the payment of the Consideration to the Sellers pursuant
to this Agreement.

“Closing Date” means the date of Closing, established under Section 3 of this
Agreement.
 
“Code” has the meaning set forth in the introductory statement.

“Corporations” means GPS-Connecticut and GPS-California and all of their
respective subsidiaries and affiliates (unless the context clearly indicates
otherwise). Each of GPS-Connecticut and GPS-California (and all of their
respective subsidiaries and affiliates, unless the context clearly indicates
otherwise) is sometimes referred to as “a Corporation.”

“Consideration” means the aggregate consideration set forth in Section 2 hereof.

“Delivery Date” has the meaning set forth in Section 3.1 below.

“Escrow Agent” shall mean Curtin Law Roberson Dunigan & Salans, P.C.

“GPS-California Stock” have the meaning set forth in Section 1.1.

“GPS-Connecticut Stock” shall have the meaning set forth in Section 1.1. 

“Griffin” shall mean William F. Griffin, Jr., a stockholder, officer and
director of GPS-Connecticut and of GPS-California, and a signatory to this
Agreement.

“Membership Interest Purchase Agreement” shall mean that certain Membership
Interest Purchase Agreement by and among Purchaser, Gemma Power Systems, LLC (a
Connecticut limited liability company), GPS-Connecticut, GPS-California, Griffin
and Canino to be executed contemporaneously with this Agreement.
 
2

--------------------------------------------------------------------------------

“Organizational Documents” shall mean (a) the articles or certificate of
incorporation and the bylaws of a corporation; (b) the articles of organization
and the operating agreement of any limited liability company; (c) the
partnership agreement and any statement of partnership of a general partnership;
(d) the limited partnership agreement and the certificate of limited partnership
of a limited partnership; (e) any charter or similar document adopted or filed
in connection with the creation, formation, or organization of any entity; and
(f) any amendment to any of the foregoing.

“Other Stockholders” shall have the meaning set forth in Section 1.1.

“Plan of Reorganization” shall mean the Plan of Reorganization adopted and
approved by the Boards of Directors of Purchaser, GPS-Connecticut and
GPS-California and by the managers of GPS in the form of the Plan of
Reorganization attached hereto as Exhibit D.
 
“SEC” shall have the meaning set forth in Section 4.12.

“Sellers” has the meaning set forth in the preface above.
 
SECTION 1

ACQUISITION OF STOCK

1.1 Acquisition of Stock. On the Closing Date (as defined in Section 3), and
subject to and upon the fulfillment or waiver of the terms and conditions of
this Agreement and of the Membership Interest Purchase Agreement, Purchaser
shall acquire (i) from the Sellers and the other stockholders of GPS-Connecticut
(the “Other Stockholders”) all of the authorized issued and outstanding capital
stock of GPS-Connecticut, including all warrants, options, convertible
securities or other rights (contingent or otherwise) to purchase or acquire
stock of GPS-Connecticut (the “GPS-Connecticut Stock”), and (ii) from the
Sellers all of the authorized issued and outstanding capital stock of
GPS-California, including all warrants, options, convertible securities or other
rights (contingent or otherwise) to purchase or acquire stock of GPS-California
(the “GPS-California Stock”). Purchaser’s acquisition of all of the
GPS-Connecticut Stock and all of the GPS-California Stock shall be by means of a
tax-free reorganization under Section 368(a)(1)(B) of the Code. The names,
addresses and numbers of shares of GPS-Connecticut Stock and of GPS-California
Stock held by each of the Sellers and each of the Other Stockholders is set
forth on Schedule 1.1.

1.2 Organizational Documents, Management.

(a) Organizational Documents. At Closing, the Organizational Documents of the
Corporations shall be amended in the manner determined by Purchaser, as sole
stockholder of GPS-Connecticut and of GPS-California.
 
3

--------------------------------------------------------------------------------

(b) Management. At Closing, Purchaser, as sole stockholder of GPS-Connecticut
and of GPS-California, shall take all appropriate action to elect the persons
designated on Schedule 1.2(b) as the directors and the officers of
GPS-Connecticut and of GPS-California, respectively, until their respective
successors are duly elected or appointed and qualified.

SECTION 2

CONSIDERATION

2.1 Consideration.  The total consideration to be paid by Purchaser to the
Sellers and to the Other Stockholders (the “Consideration”) shall be an amount
equal to Four Million Eight Hundred Seventy-Five Thousand Dollars ($4,875,000)
in Argan Common Stock. The Consideration shall be allocated Two Million
Forty-Seven Thousand Five Hundred Dollars ($2,047,500) for all of the
GPS-Connecticut Stock, and Two Million Eight Hundred Twenty-Seven Thousand Five
Hundred Dollars ($2,827,500) for all of the GPS-California Stock, and shall be
determined and paid in accordance with Section 2.2.

2.2 Payment of Consideration .  The Consideration shall be paid at Closing:.
 
(a) for the shares of GPS-Connecticut Stock, through issuance of the number of
shares of Argan Common Stock equal in value to Two Million Forty-Seven Thousand
Five Hundred Dollars ($2,047,500), valued at the Argan Per Share Value (the
“GPS-Connecticut Stock Consideration”). At Closing, the Sellers and the Other
Stockholders shall receive their respective pro rata shares of the
GPS-Connecticut Stock Consideration as set forth in Schedule 2.2; and

(b) for the shares of GPS-California Stock, through issuance of the number of
shares of Argan Common Stock equal in value to Two Million Eight Hundred
Twenty-Seven Thousand Five Hundred Dollars ($2,827,500), valued at the Argan Per
Share Value (the “GPS-California Stock Consideration”). At Closing, the Sellers
shall receive their respective pro rata shares of the GPS-California Stock
Consideration as set forth in Schedule 2.2.   
 
SECTION 3
 
CLOSING
 
3.1 Closing; Deliveries into Escrow. The closing of the acquisition of the
GPS-Connecticut Stock and the GPS-California Stock (the “Closing”) shall take
place on a date designated by Purchaser in a notice given to the Sellers that
shall be not earlier than one (1) Business Day nor later than five (5) Business
Days following the execution of this Agreement, the Membership Interest Purchase
Agreement, and of all documents contemplated under this Agreement and under the
Membership Interest Purchase Agreement, and placement thereof, together with all
other documents or items to be delivered by the parties at Closing under this
Agreement and under the Membership Interest Purchase Agreement into escrow with
the Escrow Agent (the “Delivery Date”), or at such other time, date and place as
Purchaser and the Sellers may agree (the “Closing Date”). In satisfying their
obligations hereunder, the Sellers shall cause the Other Stockholders to
transfer to the Escrow Agent, to be held in escrow pursuant to this Section 3,
duly endorsed stock certificates representing all of the outstanding shares
owned by the Other Stockholders of GPS-Connecticut Stock together with such
other customary documents as may be required to transfer same.
 
4

--------------------------------------------------------------------------------

3.2 Deliveries by Escrow Agent. Upon confirmation from either Purchaser or the
Sellers that the wire transfer of funds described in Section 3.2 of the
Membership Interest Purchase Agreement has been effected, the Escrow Agent shall
be authorized, and hereby agrees, to date as of the Closing Date all documents
held by it in escrow which, in accordance with the terms of this Agreement, are
to be dated as of the Closing Date and to deliver, and the Escrow Agent shall
release from escrow and deliver, (i) to the Sellers, and to the Other
Stockholders, as the case may be, stock certificates representing the
Consideration described in Section 2, and (ii) to Purchaser (A) duly
endorsed stock certificates representing all of the outstanding shares of
GPS-Connecticut Stock together with such other customary documents as may be
required to transfer same, (B) duly endorsed stock certificates representing all
of the outstanding shares of GPS-California Stock together with such other
customary documents as may be required to transfer same.

SECTION 4
 
MISCELLANEOUS
 
4.1 Costs. Each party shall pay its own expenses incident to the transaction
contemplated hereby, including fees and expenses of their attorneys,
accountants, appraisers or consultants, whether or not those transactions are
consummated at Closing.

4.2 Attorneys Fees. If any party initiates any litigation against any other
party involving this Agreement, the prevailing party in such action shall be
entitled to receive reimbursement from the other party for all reasonable
attorneys’ fees and other costs and expenses incurred by the prevailing party in
respect of that litigation, including any appeal, and such reimbursement may be
included in the judgment or final order issued in that proceeding.
 
4.3 Titles and Captions. All articles or section titles or captions in this
Agreement are for convenience of reference and shall in no way define, limit,
extend or describe the scope or intent of provisions herein.

4.4 Applicable Law. This Agreement is to be governed by, and construed,
interpreted, and enforced in accordance with, the laws of the State of Delaware.
 
5

--------------------------------------------------------------------------------

4.5 Binding Effect and Assignment. This Agreement shall be binding on and inure
to the benefit of the parties hereto and their respective heirs, personal
representative, affiliates, successors and assigns. Notwithstanding the
foregoing, neither the Corporations nor Purchaser shall have any right to assign
any of its or their rights or obligations under this Agreement without the prior
written consent of the other parties hereto.

4.6 Notices. All notices, consents, waivers, and other communications under this
Agreement must be in writing and will be deemed to have been duly given when
(a) delivered by hand (with written confirmation of receipt), (b) sent by
facsimile (with written confirmation of receipt), provided that a copy is mailed
by registered mail, return receipt requested, or (c) when received by the
addressee, if sent by a nationally recognized overnight delivery service
(receipt requested), in each case to the appropriate addresses and facsimile
numbers set forth below (or to such other addresses and facsimile numbers as a
party may designate by notice to the other parties):

If the Corporations then:
 
Gemma Power, Inc. and
   
Gemma Power Systems of California, Inc.
   
2461 Main Street
   
Glastonbury, Connecticut 06033
   
Attention: Mr. William F. Griffin, Jr. and Joel M. Canino
   
Fax: (860) 659-0607
     
If Griffin then:
 
Mr. William F. Griffin, Jr.
   
c/o Gemma Power Systems, LLC
   
2461 Main Street
   
Glastonbury, Connecticut 06033
   
Fax: (860) 659-0607
     
If Canino then:
 
Mr. Joel M. Canino
   
c/o Gemma Power Systems, LLC
   
2461 Main Street
   
Glastonbury, Connecticut 06033
   
Fax: (860) 659-0607
     
Counsel for the Corporations, Griffin and
Canino:
 
John W. Beck
   
Siegel, O’Connor, O’Donnell & Beck, P.C.
   
150 Trumbull Street
   
Hartford, Connecticut 06103
   
Fax: (860) 724-3550
     
If Purchaser then:
 
Argan, Inc.
   
One Church Street, Suite 401
   
Rockville, Maryland 20950
   
Attn: Arthur Trudel
   
Fax: (301) 315-0064

 
6

--------------------------------------------------------------------------------

 
Counsel for Purchaser:
 
David B. Law
   
Curtin Law Roberson Dunigan
   
& Salans, PC
   
1900 M Street, N.W.
   
Suite 600
   
Washington, D.C. 20036
   
Fax: 202/530-4411

4.7 Severability. Inapplicability or unenforceability of any provision of this
Agreement shall not impair the operation or validity of any other provision
hereof. If any provision shall be declared inapplicable or unenforceable, there
shall be added automatically as part of this Agreement a provision as similar in
terms to such inapplicable or unenforceable provision as may be possible and be
legal, valid and enforceable.

4.8 Acceptance or Approval. By accepting all or approving anything required to
be observed, performed, or fulfilled, or to be given to Purchaser pursuant to
this Agreement, Purchaser shall not be deemed to have accepted or approved the
sufficiency, legality, effectiveness or legal effect of the same, or of any
term, provision, or condition thereof as to third parties.

4.9 Entire Agreement. This Agreement, including all Exhibits and Schedules,
constitutes the entire agreement among the parties hereto pertaining to the
subject matter hereof, and supersedes all prior agreements and understandings
pertaining thereto. No covenant, representation, or condition not expressed in
this Agreement shall affect or be deemed to interpret, change or restrict the
express provisions hereof and no amendments hereto shall be valid unless made in
writing and signed by all parties hereto.

4.10 Counterparts. This Agreement may be executed in any number of counterparts,
all of which together shall constitute one instrument.

4.11 Securities Matters. By executing this Agreement, Purchaser acknowledges
that: (i) Purchaser has been advised that the GPS-Connecticut Stock and the
GPS-California Stock has not been and will not have been registered under the
Act or the applicable securities laws of any state, that the Sellers in
transferring such stock to Purchaser will be relying, if applicable, upon the
exemption from such registration requirements contained in Section 4(1) or 4(2)
of the Act as a transaction by a person other than an issuer, underwriter or
dealer and the applicable state exemption; (ii) the GPS-Connecticut Stock and
the GPS-California Stock may be “restricted” as that term is used in Rule 144
under the Act as a consequence of which Purchaser may not be able to sell the
interests unless such stock is first registered under the Act and any applicable
state securities laws or unless an exemption from such registration is, in the
opinion of counsel, available; (iii) the GPS-Connecticut Stock and the
GPS-California Stock will be acquired by Purchaser for purposes other than
“distribution” as that term is used in Section 2(11) of the Act, and (iv)
Purchaser will execute, if Sellers so request, an appropriate letter affirming
that its intention with respect to the proposed acquisition of the
GPS-Connecticut Stock and the GPS-California Stock is that such acquisition be
for investment purposes only and not with a view toward resale or distribution
thereof.  
 
7

--------------------------------------------------------------------------------

4.12 Preparation and Filing of SEC Documents. If and whenever, as a result of
the transaction contemplated hereunder, Purchaser is under an obligation to
provide financial information to, or prepare a filing of any kind with, the
United States Securities and Exchange Commission (the “SEC”), the Sellers shall
assist Purchaser in preparing any audited financial statements required by the
SEC for this purpose. The cost of preparing any such financial statements shall
be borne by Purchaser.

4.13 Further Assurances. From time to time at or after the Closing, upon
request, the parties each will execute and deliver such other instruments of
conveyance, assignment, transfer and delivery and take such actions as the other
party reasonably may request in order to consummate, complete and carry out the
purposes of the transactions contemplated hereby.

4.14 Tag Along Rights.

4.14.1 In the event that one or more holders (the "Tag Along Holders") of common
stock of Purchaser (including any successor thereof) shall transfer (or agree to
transfer) more than fifty percent (50%) of the outstanding common stock of
Purchaser, then Purchaser shall use commercially reasonable efforts to include
the Sellers and the Other Stockholders (including any assignees or successors
thereof), to the extent that they then hold shares of common stock of Purchaser,
in said sale upon the same terms and subject to the same conditions as apply to
the Tag Along Holders.

4.14.2 In addition, in the event Purchaser proposes any underwritten secondary
offering of its common stock, Purchaser will give prior written notice thereof
to each Seller and the Other Stockholders offering them the opportunity to
include in any such offering such number of shares as they may request in
writing not later than ten (10) days before such filing. Upon receipt by
Purchaser of any such request, Purchaser shall use reasonable efforts to cause
the managing underwriter to include such shares in such secondary offering.
 
4.15 Access to Corporate Records. From and after the Closing, Purchaser shall
allow Griffin, Canino, and their respective authorized agents, access to the
Corporations’ books and records in the event that the same is necessary in
connection with any tax audits or other indemnifiable claims, which audit or
indemnifiable claim arose with respect to the Sellers’ period of ownership of
the GPS-Connecticut Stock and the GPS-California Stock prior to the Closing
Date.

SECTION 5

ESCROW PROVISIONS

5.1 Each of the parties to this Agreement recognizes and acknowledges that the
Escrow Agent is serving solely as an accommodation to the parties, and each of
them agrees that the Escrow Agent shall not be liable to any of the parties for
any error of judgment, mistake, or act or omission hereunder, or any matter or
thing arising out of its conduct hereunder, except for the Escrow Agent's
willful misfeasance or gross negligence. The Escrow Agent shall be entitled to
rely upon the authenticity of any signature, and the genuineness and/or validity
of any writing received by the Escrow Agent pursuant to or otherwise relating to
this Agreement.
 
8

--------------------------------------------------------------------------------

5.2 The Escrow Agent is acting, and may continue to act, as counsel to Purchaser
in connection with the transactions contemplated by this Agreement.

5.3 Each of the parties jointly and severally agrees to indemnify and hold
harmless the Escrow Agent from and against any and all costs, claims, damages,
or expenses (including, without limitation, reasonable attorneys’ fees and
disbursements, whether paid to retained attorneys or representing the fair value
of legal services rendered to itself) that may be incurred by the Escrow Agent
acting under this Agreement (including, without limitation, any costs incurred
by the Escrow Agent pursuant to Section 5.4 hereof) or to which the Escrow Agent
may be put in connection with the Escrow Agent acting under this Agreement,
except for costs, claims, or damages arising out of the Escrow Agent’s willful
misfeasance or gross negligence.

5.4 In the event that: (a) the Escrow Agent shall receive contrary instructions
from the parties; or (b) any dispute shall arise as to any matter arising under
this Agreement; or (c) there shall be any uncertainty as to the meaning or
applicability of any of the provisions hereof, or the Escrow Agent’s duties,
rights or responsibilities hereunder, or any written instructions received by
the Escrow Agent pursuant hereto, the Escrow Agent shall not itself determine
such dispute, controversy or uncertainty, but shall either (i) continue to hold
the documents and other items placed with it pursuant to the terms of this
Agreement until otherwise directed in writing by joint instruction of the
parties, or by a final non-appealable court order, or (ii) at its option, at any
time that such dispute, controversy or uncertainty continues, deposit said
documents and other items into any court having appropriate jurisdiction.

5.5 Upon the delivery or disposition of the documents and other items placed
with it in accordance with the provisions of this Agreement, the Escrow Agent
shall thereupon be relieved of, and discharged and released from, any and all
liability hereunder and with respect to said documents and other items and
Escrow Agent’s obligations under this Agreement shall be deemed to have been
completed. 
 
[Signatures on following pages]
 
9

--------------------------------------------------------------------------------

 
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day
and year first above written.
 

ATTEST:      ARGAN, INC.
 
 
      /s/ Arthur Trudel  
 By:
/s/ Rainer Bosselmann

--------------------------------------------------------------------------------

   

--------------------------------------------------------------------------------

Name: Rainer Bosselmann
Title: Chairman and CEO

ATTEST:   
 
GEMMA POWER, INC.
 
 
         
 By:
/s/ William F. Griffin, Jr.

--------------------------------------------------------------------------------

   

--------------------------------------------------------------------------------

William F. Griffin, Jr., President

ATTEST:      GEMMA POWER SYSTEMS
CALIFORNIA, INC.
 
 
         
 By:
/s/ William F. Griffin, Jr.

--------------------------------------------------------------------------------

   

--------------------------------------------------------------------------------

William F. Griffin, Jr., President

WITNESS:       
 
 
         
 By:
/s/ William F. Griffin, Jr.

--------------------------------------------------------------------------------

   

--------------------------------------------------------------------------------

WILLIAM F. GRIFFIN, JR.

WITNESS:       
 
 
         
 
/s/ Joel M. Canino

--------------------------------------------------------------------------------

   

--------------------------------------------------------------------------------

JOEL M. CANINO

 
10

--------------------------------------------------------------------------------

 
Escrow Agent hereby executes the foregoing Agreement for the sole purpose of
agreeing to the provisions of Section 3.2 thereof, subject to the provisions of
Section 5 thereof.

ESCROW AGENT:
 

 
CURTIN LAW ROBERSON DUNIGAN & SALANS, P.C.
       
 
 
       By: /s/ David B. Law        

--------------------------------------------------------------------------------

David B. Law, Vice President
   

11

--------------------------------------------------------------------------------