Document:

exv10w1

Exhibit 10.1

EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as of the __ day of
June, 2011, by and between A. SCHULMAN, INC., a Delaware corporation (the “Employer” or “Company”),
and Joseph J. Levanduski (the “Employee”).

     WHEREAS, the Employer and the Board of Directors of the Company desire to provide for the
employment of the Employee as a member of the Employer’s management, which the Employer and the
Board of Directors believe is in the best interest of the Company and its stockholders; and

     WHEREAS, the Employee is willing to commit himself to become employed and to serve the
Employer, on the terms and conditions herein provided.

     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants herein contained,
the parties hereto agree as follows:

     1. DEFINED TERMS

     The definitions of capitalized terms used in this Agreement (unless stated where first used)
are provided in Section 20 hereof.

     2. EMPLOYMENT

     During the Term of this Agreement, the Employer hereby agrees to employ Employee as Vice
President, Chief Financial Officer and Treasurer, and the Employee hereby accepts such employment
on the terms and conditions herein contained.

     3. DUTIES AND CONDITIONS OF EMPLOYMENT

          3.1 DUTIES. The Employee shall devote his entire business time, attention and energies to the
Employer and shall not engage in any conduct which shall reflect adversely upon the Employer. The
Employee shall perform such duties for the Employer as may be assigned to one in his executive
status and capacity by the Chief Executive Officer of the Company or the Board of the Company. The
Employee shall serve diligently and to the best of his ability.

     During his employment by the Employer, the Employee shall not, without the Company’s prior
written consent, be engaged in any other business activity, whether or not such business activity
is pursued for gain, profit or other pecuniary advantage, except that notwithstanding the
foregoing, he may invest his personal funds for his own account; provided that such investment
shall be passive and not controlling in any such investment and subject to the provisions of
Section 13.2 hereof and provided further that he will not be required to provide any substantial
services on behalf of such enterprise. Notwithstanding the foregoing, the Employee may serve on the
Boards of Directors of other corporations during the Term as long as the Employee notifies the
Employer’s Chief Executive Officer and the Chief Executive Officer determines that such service
will not interfere with the performance of Employee’s duties hereunder.

 

 

          3.2 CONDITIONS. The Employee shall be provided with suitable office space, furnishings,
secretarial and administrative assistance. Without the Employee’s consent, the Employee shall not
be required to report principally to an office located more than five hundred (500) miles from his
principal office at the date of this Agreement, except to the extent the Employee may be required
to report to the Company’s principal office.

     4. TERM OF AGREEMENT; TERMINATION OF EMPLOYMENT; ESCROW DURING DISPUTE

          4.1 TERM OF AGREEMENT. The Employer hereby employs the Employee for a Term commencing as of
June 10, 2011 and ending December 31, 2014 (“Term”). At the end of the Term, Employee will be an
employee-at-will of the Company and the Company may terminate the Employee at any time, for any
reason or for no reason, with or without cause.

          4.2 TERMINATION OF EMPLOYMENT. The Company may terminate the employment of the Employee for
Cause pursuant to this Agreement. Prior to any Change in Control, the Employee may terminate his
employment pursuant to this Agreement if the Employer fails to make full and timely payments of all
sums provided for in Sections 5 and 6 hereof (subject to Section 7.2 hereof), or otherwise shall
breach its covenants hereunder in any material respect (“Resignation for Cause”). A termination of
employment by the Employee due to a Resignation for Cause will entitle the Employee to the same
benefits as if the Employee’s employment was terminated without Cause.

          4.3 ESCROW DURING A TERMINATION DISPUTE. Prior to any Change in Control, if the Employee is
terminated for Cause, and, within thirty (30) days of such termination, Employee notifies the
Employer of his intention to adjudicate such termination as improper, the Employer agrees that it
will deposit with KeyBank, National Association, Cleveland, Ohio (or any successor thereto), as
Escrow Agent, the installments of the Employee’s Base Salary (as provided in Section 5 below) as
the same would have become payable but for such termination. In the event of a final adjudication
by a tribunal of competent jurisdiction that such termination was not for Cause, then the amounts
so deposited in escrow, plus any interest earned on the amounts held by the Escrow Agent, shall be
delivered promptly to the Employee. If such adjudication shall be in favor of the Employer, the
Escrow Agent shall return all such sums held by it, to the Employer.

     The escrowed salary shall not be deemed to be liquidated damages but the Employer shall be
entitled to a credit against any such award to the extent of the sums so delivered to the Employee.

     5. COMPENSATION

     The Employer agrees to pay to the Employee as compensation for his services hereunder an
annual Base Salary initially equal to $371,500, payable in substantially equal weekly, biweekly,
bimonthly or monthly installments, as the case may be, in a manner consistent with the Employer’s
payroll practices. The Base Salary may be discretionarily increased by the Compensation Committee
of the Board from time to time as it deems appropriate in its

-2-

 

reasonable judgment and based upon the recommendations of the Chief Executive Officer from
evaluations of Employee’s performance. The Base Salary in effect from time to time shall not be
decreased during the Term (except as provided in Section 7.2). Employee shall also be entitled to
4 weeks of paid vacation annually, prorated in the first year based on Employee’s initial hiring
date. Employee will be subject to all other vacation rules in accordance with Employer’s policy.

     It is understood and agreed that the Employee’s compensation may not be limited to his Base
Salary and that the Employee may receive an annual bonus (“Bonus”) in an amount, if any, determined
annually by the Employer. During the Term, Employee will be eligible to participate in an annual
bonus plan at a target based on 50% of Base Salary (the “Target Bonus”). Payments of the Bonus
will depend upon the achievement of various financial goals and operating metrics, as well as an
assessment of Employer’s individual performance, and may vary from 0% to 200% of the Target Bonus.

     The Employee shall also participate in employee compensation and benefit plans available
generally to executives of the Employer (including, without limitation, any equity incentive plan,
any tax-qualified profit sharing plan, nonqualified profit sharing plan, life insurance plan and
health insurance plan) on a level appropriate to his position and shall receive the employee fringe
benefits available generally to executives of the Employer in accordance with Employer policies.

     6. EXPENSES

     The Employee is authorized to incur reasonable expenses for promoting the business of the
Employer, including expenses for entertainment, travel and similar items. The Employer shall
reimburse the Employee in accordance with the Employer’s policy for all such expenses upon the
presentation by the Employee, from time to time, of an itemized account of such expenditures.

     7. PRE-TERMINATION COMPENSATION; DISABILITY

          7.1 NORMAL PRE-TERMINATION COMPENSATION. If the Employee’s employment shall be terminated for
any reason during the Term (or, if later, prior to the end of the Change-in-Control Protective
Period), the Employer shall pay the Employee’s Base Salary to the Employee through the Date of
Termination at the rate in effect at the time the Notice of Termination is given (subject to
Section 7.2 hereof) within thirty (30) days following the Date of Termination, together with all
compensation and benefits payable to the Employee through the Date of Termination under the terms
of any compensation or benefit plan, program or arrangement maintained by the Employer during such
period. Subject to Sections 8, 9, 10 and 11 hereof, after completing the expense reimbursements
required by Section 6 hereof and making the payments and providing the benefits required by this
Section 7, the Employer shall have no further obligations to the Employee under this Agreement.

          7.2 DISABILITY ADJUSTMENT TO BASE SALARY PAYMENTS. During the Term (or, if later, at any time
prior to the end of the Change-in-Control Protective Period), during any period that the Employee
is Disabled (but in no event for more than twenty-four (24) months) (the “Disability Period”), the
Employer shall pay only sixty percent (60%) of the

-3-

 

Employee’s Base Salary to the Employee at the rate in effect at the commencement of any such
Disability Period (less amounts, if any, payable to the Employee at or prior to the time of any
such Base Salary payment under disability benefit plans of the Employer or under the Social
Security disability insurance program). After six (6) months of Disability, the Employer shall have
the right to terminate the Employee’s employment pursuant to this Agreement and all Base Salary
payments shall cease; provided, however, that the sixty percent (60%) payments pursuant to the
foregoing sentence shall continue for the Disability Period. All payments made pursuant to this
Section 7.2 shall be made in accordance with the regular payroll practices of the Employer. Except
to the extent provided in this Section 7.2, all Base Salary payments to the Employee shall be
abated during the Disability Period. Subject to Sections 8, 9, 10 and 11 hereof, after completing
the expense reimbursements required by Section 6 hereof and making the payments and providing the
benefits required by this Section 7, the Employer shall have no further obligations to the Employee
under this Agreement.

     8. NORMAL POST-TERMINATION PAYMENTS; CONTINUATION PAY; TERMINATION PAY; PROMPT PAYMENT

     Whenever used in this Agreement, the words “terminate,” “terminated” or “termination” in
connection with the Employee’s employment shall mean the Employee’s “separation from service,”
within the meaning of Section 409A of the Code and Treasury Regulation Section 1.409A-1(h), from
the Employer and any person with whom the Employer would be considered a single employer under
Sections 414(b) and (c) of the Code.

          8.1 NORMAL POST-TERMINATION PAYMENTS. If the Employee’s employment shall be terminated for any
reason during the Term of this Agreement (or, if later, prior to the end of the Change-in-Control
Protective Period), the Employer shall pay the Employee’s normal post-termination compensation and
benefits to the Employee as such payments become due. Such post-termination compensation and
benefits shall be determined under, and paid in accordance with, the Employer’s retirement,
insurance and other compensation or benefit plans, programs and arrangements (other than this
Agreement).

          8.2 CONTINUATION PAY; TERMINATION PAY. Notwithstanding anything to the contrary in Section
7.2, 9.1 or 10.1(A) hereof, if the laws governing this Agreement shall require that the Employer
continue to pay or otherwise compensate the Employee for any period of time following termination
of the Employee’s employment (“Continuation Pay”) or if such laws require certain amounts of
severance pay, termination compensation or the like (collectively, “Termination Pay”), then to the
fullest extent permitted by law any payments to the Employee pursuant to Section 7.2, 9.1 or
10.1(A) hereof shall be included in the calculation of Continuation Pay and Termination Pay and
such payments shall be deducted from the amount of Continuation Pay or Termination Pay due the
Employee.

          8.3 TIME OF PAYMENT.

               (A) Any payments due under Section 5, 6, 7 or 9 hereof or this Section 8 shall be made as
specified in such sections and shall be made to the Employee or in accordance with Section 14.2
hereof, as the case may be.

-4-

 

               (B) Notwithstanding anything in this Agreement to the contrary, if the Employee is a
“specified employee,” within the meaning of Section 409A of the Code and as determined under the
Company’s policy for determining specified employees, on the Date of Termination, all payments
under this Agreement that are subject to Section 409A of the Code and become payable in connection
with the Employee’s termination shall not be paid (or commence to be paid) until the first business
day of the seventh month following the Date of Termination (or, if earlier, the Employee’s death).
The first payment that can be made shall include the cumulative amount of any amounts that could
not be paid during such postponement period.

     9. POST-TERMINATION PAYMENTS UPON TERMINATION (PRIOR TO A CHANGE IN CONTROL) BY DEATH OR BY
THE EMPLOYER WITHOUT CAUSE

          9.1 DEATH BENEFIT. If the Employee’s employment shall be terminated by death during the Term
and prior to a Change in Control, then, in addition to the compensation and benefits provided by
Sections 7.1 and 8 hereof, within ninety (90) days following the Employee’s death, the Employer
shall pay a lump sum amount equal to sixty percent (60%) of the Base Salary for twenty-four (24)
months in accordance with Section 14.2.

          9.2 TERMINATION BY THE EMPLOYER WITHOUT CAUSE. If the Employer shall terminate the Employee’s
employment during the Term and prior to a Change in Control, without Cause (and not for Disability
or in connection with the Employee’s death), the Employer shall pay the Employee commencing within
sixty (60) days following termination, in consideration of Employee’s obligations under Section
13.2, and only if those obligations continue to be met during this payment period: (a) his Base
Salary until the end of the Term in accordance with Employer’s regular payroll practices; (b)
Bonuses on each October 31 during the remaining Term in an amount equal to $185,750; (c) pro rata
vesting of any equity award which has time-based vesting (a “Time-Based Award”); and (d) pro rata
vesting of any equity award which has performance-based vesting (a “Performance-Based Award” and,
collectively with the Time-Based Award, the “Awards”) if, and only if, at the end of the applicable
performance period the performance criteria for each Performance-Based Award is achieved and then
only to the extent of such achievement. The pro-rata portion of an Award to which the Employee
shall be entitled or eligible to have vested pursuant to this Section 9.2 shall be determined by
multiplying the number of shares then subject to such Award by a fraction, the numerator of which
is the number of whole months elapsed from the date of grant of the Award until the Date of
Termination and the denominator of which is the number of whole months for the regularly scheduled
vesting of such Award.

     10. SEVERANCE PAYMENTS; EXCISE TAX GROSS-UP

          10.1 SEVERANCE PAYMENTS. The Employer shall pay the Employee the payments described in this
Section 10.1 (the “Severance Payments”) upon the termination of the Employee’s employment following
a Change in Control and prior to the end of the Change-in-Control Protective Period, in addition to
any payments and benefits to which the Employee is entitled under Sections 5, 6, 7 and 8.1 hereof,
unless such termination is (i) by the Employer for Cause, (ii) by reason of death or Disability, or
(iii) by the Employee without Good Reason. For purposes of this Agreement, the Employee’s
employment shall be deemed to have been

-5-

 

terminated by the Employer without Cause following a Change in Control or by the Employee with
Good Reason following a Change in Control, as the case may be, if (i) the Employee’s employment is
terminated without Cause prior to a Change in Control and such termination was at the request or
direction of a Person who has entered into an agreement with the Employer the consummation of which
would constitute a Change in Control, (ii) the Employee terminates his employment with Good Reason
prior to a Change in Control and the circumstance or event which constitutes Good Reason occurs at
the request or direction of such Person, or (iii) the Employee’s employment is terminated by the
Employer without Cause prior to a Change in Control (but following a Potential Change in Control)
and such termination is otherwise in connection with or in anticipation of a Change in Control
which actually occurs. For purposes of any determination regarding the applicability of the
immediately preceding sentence, any position taken by the Employee shall be presumed to be correct
unless the Employer establishes to the Committee by clear and convincing evidence that such
position is not correct.

               (A) In lieu of any further salary payments to the Employee for periods subsequent to the Date
of Termination and in lieu of any severance benefit otherwise payable to the Employee, the Employer
shall pay to the Employee a lump sum severance payment, in cash, equal to two (2) times the sum of
(i) the higher of the Employee’s Base Salary in effect immediately prior to the occurrence of the
event or circumstance upon which the Notice of Termination is based or the Employee’s Base Salary
in effect immediately prior to the Change in Control, and (ii) the higher of (x) the annual Bonus
earned by the Employee in respect of the Employer’s fiscal year immediately preceding that in which
the Date of Termination occurs, (y) the average annual Bonus so earned in respect of the three
fiscal years immediately preceding that in which the Change in Control occurs, or (z) $185,750. Of
the foregoing payments, one-half of such payments shall be in consideration of and allocated to
Employee’s obligations under Section 13.2.

               (B) For 18 months after the Employee’s Date of Termination, the Company will maintain in full
force and effect, for the Employee’s continued benefit (and that of all family members and other
dependents who were enrolled in the programs on the Employee’s Date of Termination) all life,
medical and dental insurance programs in which the Employee (and members of the Employee’s family
or other dependents) were participating or by which such individuals were covered immediately
before the Employee’s Date of Termination. If the terms of any of such programs do not allow the
continued participation described in the preceding sentence, the Company will: (i) provide benefits
that are substantially similar (including eligibility conditions, conditions on benefits, the value
of benefits and the scope of coverage) to those provided by the life, medical and dental insurance
programs in which the Employee, members of the Employee’s family and dependents were participating
immediately before the Employee’s Date of Termination; and (ii) ensure that any eligibility or
other conditions on benefits under these programs, including deductibles and co-payments, will be
administered by applying the Employee’s experience under any predecessor program in which the
Employee (and members of the Employee’s family and dependents) were participating before
Termination. With respect to this Section 10.1(B), any benefits or payments relating to medical and
dental insurance that are provided after completion of the applicable continuation period permitted
under the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended, and any benefits or
payments relating to life insurance shall be subject to the following: (A) the amount of expenses
eligible for reimbursement or the benefits or payments provided during any taxable year of the

-6-

 

Employee may not affect the expenses eligible for reimbursement or the benefits or payments to
be provided to the Employee in any other taxable year; (B) reimbursement of any eligible expense
must be made on or before the last day of the Employee’s taxable year following the taxable year in
which the expense was incurred; and (C) the right to reimbursement or to such benefits or payments
is not subject to liquidation or exchange for another benefit. To the extent that any benefit
extended under this Section 10.1(B) would result in taxable compensation for the Employee, the
Employee shall be solely responsible for any such taxes.

          10.2 EXCESS PARACHUTE PAYMENT. Notwithstanding anything to the contrary in this Agreement, if
any payments or benefits paid or payable to the Employee pursuant to this Agreement or any other
plan, program or arrangement maintained by the Company or an Affiliate would constitute a
“parachute payment” within the meaning of Section 280G of the Code, then the Employee shall receive
the greater of: (a) one dollar ($1.00) less than the amount which would cause the payments and
benefits to constitute a “parachute payment” or (b) the amount of such payments and benefits, after
taking into account all federal, state and local taxes, including the excise tax imposed under
Section 4999 of the Code payable by the Employee on such payments and benefits, if such amount
would be greater than the amount specified in Section 10.2(a), after taking into account all
federal, state and local taxes payable by the Employee on such payments and benefits. Any
reduction to any payment made pursuant to this Section 10.2 shall be made consistent with the
requirements of Section 409A of the Code.

          10.3 Except as provided in Section 8.3 hereof, the payments provided in Sections 10.1(A)
hereof shall be made within thirty (30) days following the later of (i) the Date of Termination or
(ii) the Change in Control.

          At the time that payments are made under this Section, the Employer shall provide the Employee
with a written statement setting forth the manner in which such payments were calculated and the
basis for such calculations including, without limitation, any opinions or other advice the
Employer has received from outside counsel, auditors or consultants (and any such opinions or
advice which are in writing shall be attached to the statement).

          10.4 The Employer also shall pay to the Employee all legal fees and expenses incurred by the
Employee (i) in disputing in good faith any issue relating to the termination of the Employee’s
employment following a Change in Control and prior to the end of the Change-in-Control Protective
Period, (ii) in seeking in good faith to obtain or enforce any benefit or right provided by this
Agreement, or (iii) in connection with any tax audit or proceeding to the extent attributable to
the application of Section 4999 of the Code to any payment or benefit provided hereunder. Such
payments shall be made within five (5) business days after delivery of the Employee’s written
requests for payment accompanied with such evidence of fees and expenses incurred as the Employer
reasonably may require.

          10.5 In consideration of, and as a pre-condition to, receipt of any of the payments or
benefits set forth in this Section 10 or under Section 9 hereof, Employee shall execute and deliver
to Employer a written release no later than thirty (30) days after the event of termination, in a
manner compliant with the respective requirements for release of claims under the Age
Discrimination in Employment Act and the Older Workers Benefit Protection Act, pursuant to which
Employee shall fully and forever surrender, release, acquit and discharge the Employer,

-7-

 

and its principals, stockholders, directors, officers, agents, administrators, insurers,
subsidiaries, affiliates, employees, successors, assigns, related entities, and legal
representatives, personally and in their representative capacities, and each of them (collectively,
“Released Parties”), of and from any and all claims for costs of attorneys’ fees, expenses,
compensation, and all losses, demands and damage of whatsoever nature or kind in law or in equity,
whether known or unknown, including without limitation those claims arising out of, under, or by
reason of Employee’s employment with the Employer or any of the Companies, Employee’s relationship
with the Employer or any of the Companies and/or any termination of Employee’s employment
relationship and any and all claims which were or could have been asserted in any charge,
complaint, or related lawsuit. Notwithstanding the foregoing, no such release shall constitute a
waiver of, or in any manner restrict or limit, the Employee’s rights of indemnification relating to
his status as an officer of the Employer, whether arising under Delaware law, contractually, or
under Employer’s insurance coverage. If the thirty (30) day period during which Employee must
executive and deliver the written release contemplated by this Section 10.5 begins in one calendar
year and ends in a second calendar year, the payments or benefits set forth in this Section 10 or
Section 9 hereof shall not commence until the first day of the second calendar year.

     11. TERMINATION PROCEDURES

          11.1 NOTICE OF TERMINATION. During the Term (and, if longer, until the end of the
Change-in-Control Protective Period), any purported termination of the Employee’s employment (other
than by reason of death) shall be communicated by written Notice of Termination from one party
hereto to the other party hereto in accordance with Section 15 hereof. For purposes of this
Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of the Employee’s employment
under the provision so indicated. Further, with respect to any purported termination of the
Employee’s employment after a Change in Control and prior to the end of the Change-in-Control
Protective Period, a Notice of Termination for Cause is required to include a copy of a resolution
duly adopted by the affirmative vote of not less than three-quarters (3/4) of the entire membership
of the Board at a meeting of the Board which was called and held for the purpose of considering
such termination (after reasonable notice to the Employee and an opportunity for the Employee,
together with the Employee’s counsel, to be heard before the Board) finding that, in the good faith
opinion of the Board, the Employee was guilty of conduct set forth in clause (i) or (ii) of the
definition of Cause herein, and specifying the particulars thereof in detail.

          11.2 DATE OF TERMINATION. “Date of Termination,” with respect to any purported termination of
the Employee’s employment during the Term (and, if longer, prior to the end of the
Change-in-Control Protective Period), shall mean the date of the Employee’s “separation from
service” within the meaning of Section 409A of the Code and Treasury Regulation Section
1.409A-1(h). Any Notice of Termination relating to a termination for Disability shall be provided
thirty (30) days prior to the Date of Termination (provided that the Employee shall not have
returned to the full-time performance of the Employee’s duties during such thirty (30) day period).
Any Notice of Termination relating to the termination of the Employee’s employment by the Employer
for any other reason shall be provided not less than thirty (30) days prior to the Date of
Termination (except in the case of a termination for Cause).

-8-

 

Any Notice of Termination relating to the termination of the Employee’s employment by the
Employee for any other reason shall be provided not less than fifteen (15) days nor more than sixty
(60) days prior to the Date of Termination.

     12. NO MITIGATION

     The Employer agrees that, if the Employee’s employment with the Employer terminates following
a Change in Control and prior to the end of the Change-in-Control Protective Period, the Employee
is not required to seek other employment or to attempt in any way to reduce any amounts payable to
the Employee by the Employer pursuant to Section 10 hereof. Further, the amount of any payment or
benefit provided for in this Agreement shall not be reduced by any compensation earned by the
Employee as the result of employment by another employer, by retirement benefits, by offset against
any amount claimed to be owed by the Employee to the Employer, or otherwise.

     13. CONFIDENTIALITY; NON-COMPETITION AND NON-SOLICITATION

          13.1 CONFIDENTIALITY. The Companies’ methods, plans for doing business, processes, pricing,
compounds, customers and suppliers are vital to the Companies and, to the extent not made public by
the Companies, constitute confidential information subject to the Companies’ proprietary rights
therein. The Employee covenants and agrees that during the Term and at all times thereafter, the
Employee will not, directly or indirectly, make known, divulge, furnish, make available or use,
otherwise than in the regular course of the Employee’s employment by the Employer, any invention,
product, process, apparatus or design of any of the Companies, or any knowledge or information in
respect thereof (including, but not limited to, business methods and techniques), or any other
confidential or so-called “insider” information of any of the Companies. This covenant shall apply
without regard to the time or circumstances of any termination of the Employee’s employment. The
covenants in this Section 13.1 do not apply to information that Employee can affirmatively
demonstrate (i) is in the public domain through no act or omission of the Employee; (ii) was
lawfully in the Employee’s possession prior to the date of this Agreement; or (iii) was lawfully
disclosed by a third party to the Employee after the Date of Termination.

          13.2 NON-COMPETITION AND NON-SOLICITATION. The Employee covenants and agrees that during the
period of one (1) year following any termination of the Employee’s employment, the Employee will
not, directly or indirectly, either as an individual for the Employee’s own account or as an
investor, or other participant in, or as an employee, agent, or representative of, any other
business enterprise:

     (i) solicit, employ, entice, take away or interfere with, or attempt to solicit, employ,
entice, take away or interfere with, any employee of the Employer or the Companies if such
employee was employed by the Employer or the Companies at any time within six months of the Date
of Termination; or

     (ii) engage or participate in or finance, aid or be connected with any enterprise which
competes with the business of the Companies, or any of them.

-9-

 

     The geographical limitations of the foregoing shall include any country in which the Companies
or any of them shall be doing business as of such date of such termination.

          13.3 The Employee acknowledges that the covenants contained in this Section 13 are of the
essence of this Agreement and said covenants shall be construed as independent of any other
provisions of this Agreement. Recognizing the irreparable nature of the injury that could result
from the Employee’s violation of any of the covenants and agreement to be performed and/or observed
by the Employee pursuant to the provisions of this Section 13, and that damages would be inadequate
compensation, it is agreed that any violations by the Employee of the provisions of this Section
13, shall be the proper subject for immediate injunctive and other equitable relief to the
Employer.

     14. SUCCESSORS; BINDING AGREEMENT

          14.1 In addition to any obligations imposed by law upon any successor to the Employer, the
Employer will require any successor (whether direct or indirect, by purchase, merger, consolidation
or otherwise) to all or substantially all of the business and/or assets of the Employer to
expressly assume and agree to perform this Agreement in the same manner and to the same extent that
the Employer would be required to perform it if no such succession had taken place. Failure of the
Employer to obtain such assumption and agreement prior to the effectiveness of any such succession
shall be a breach of this Agreement and shall entitle the Employee to terminate the Employee’s
employment for Good Reason after a Change in Control. Except as provided in this Section 14.1,
this Agreement shall not be assignable by either party without the written consent of the other
party hereto.

          14.2 This Agreement shall inure to the benefit of and be enforceable by the Employee’s
personal or legal representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If the Employee shall die while any amount would still be payable to the
Employee hereunder (other than amounts which, by their terms, terminate upon the death of the
Employee) if the Employee had continued to live, all such amounts, unless otherwise provided
herein, shall be paid in accordance with the terms of this Agreement to the executors, personal
representatives or administrators of the Employee’s estate.

     15. NOTICES

     For purposes of this Agreement, notices and all other communications provided for in the
Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed
by United States registered mail, return receipt requested, postage prepaid, addressed, if to the
Employee, to the address shown for the Employee in the personnel records of the Employer and, if to
the Employer, to the address set forth below, or to such other address as either party may have
furnished to the other in writing in accordance herewith, except that notice of change of address
shall be effective only upon actual receipt:

-10-

 

     To the Employer:

Kim L. Whiteman

Vice President Global Human Resources

A. Schulman, Inc.

P.O. Box 1710

Akron, Ohio 44309-1710

     With a copy to:

J. Bret Treier

Vorys, Sater, Seymour and Pease LLP

106 South Main Street, Suite 1100

Akron, Ohio 44308

     16. MISCELLANEOUS

     No provision of this Agreement may be modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing and signed by the Employee and such officer as
may be specifically designated by the Board. No waiver by either party hereto at any time of any
breach by the other party hereto of, or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. This Agreement supersedes
any other agreements or representations, oral or otherwise, express or implied, with respect to the
subject matter hereof which have been made by either party, except as expressly set forth in this
Agreement. The validity, interpretation, construction and performance of this Agreement shall be
governed by the laws of the State of Ohio. All references to sections of the Exchange Act or the
Code shall be deemed also to refer to any successor provisions to such sections. Any payments
provided for hereunder shall be paid net of any applicable withholding required under federal,
state or local law and any additional withholding to which the Employee has agreed. The obligations
of the Employer and the Employee under this Agreement which by their nature may require (partial or
total) performance after the expiration of the Term or the Change-in-Control Protective Period
(including, without limitation, those under Sections 5 through 11 and Section 13 hereof) shall
survive such expiration.

     17. VALIDITY

     The invalidity or unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement, which shall remain in full
force and effect.

     18. COUNTERPARTS

     This Agreement may be executed in several counterparts, each of which shall be deemed to be an
original but all of which together will constitute one and the same instrument.

-11-

 

     19. SETTLEMENT OF DISPUTES AFTER CHANGE IN CONTROL; ARBITRATION

     After a Change in Control and prior to the end of the Change-in-Control Protective Period, all
claims by the Employee for benefits under this Agreement shall be directed to and determined by the
Committee and shall be in writing. Any denial by the Committee of a claim for benefits under this
Agreement shall be delivered to the Employee in writing and shall set forth the specific reasons
for the denial and the specific provisions of this Agreement relied upon. The Committee shall
afford a reasonable opportunity to the Employee for a review of the decision denying a claim and
shall further allow the Employee to appeal to the Committee a decision of the Committee within
sixty (60) days after notification by the Committee that the Employee’s claim has been denied. Any
further dispute or controversy arising under or in connection with this Agreement shall be settled
exclusively by arbitration in Akron, Ohio, in accordance with the rules of the American Arbitration
Association with respect to employment disputes then in effect. Judgment may be entered on the
arbitrator’s award in any court having jurisdiction. Notwithstanding any provision of this
Agreement to the contrary, the Employee shall be entitled to seek specific performance of the
Employee’s right to be paid until the Date of Termination during the pendency of any dispute or
controversy arising under or in connection with this Agreement.

     20. DEFINITIONS

     For purposes of this Agreement, the following terms shall have the meanings indicated below:

     (A) “Beneficial Owner” shall have the meaning set forth in Rule 13d-3 under the Exchange Act.

     (B) “Board” shall mean the Board of Directors of the Employer.

     (C) “Cause” for termination by the Employer of the Employee’s employment shall mean the
following:

     (i) any act of fraud, embezzlement, misappropriation or conversion by the Executive of
the assets or business opportunities of the Employer;

     (ii) conviction of the Employee of (or plea by the Executive of guilty to) a felony (or
a misdemeanor that originally was charged as a felony but was reduced to a misdemeanor as
part of a plea bargain);

     (iii) intentional and repeated material violations by the Employee of the Employer’s
written policies or procedures or intentional and material breach of any contract with or
violation of any legal obligation owed to the Employer provided that a breach or violation
shall be considered intentional and material only if the Employee fails to cure to the best
of the Employee’s ability such breach within thirty (30) days after delivery to the Employee
of a written notice from the Board specifying such breach; or

-12-

 

     (iv) willful engagement in gross misconduct or intentional misrepresentation that is
materially and demonstrably injurious to the Employer, provided that such breach is not
cured within thirty (30) days after delivery to the Employee of a written notice requesting
cure.

     For purposes of the above definition, no act or failure to act, on Employee’s part shall be
deemed “willful” unless done, or omitted to be done, by the Employee not in good faith and without
reasonable belief that the Employee’s act or failure to act, was in the best interest of the
Employer. In the event of a dispute concerning the application of the definition of Cause, no
claim by the Employer that Cause exists shall be given effect unless the Employer establishes to
the Committee by clear and convincing evidence that Cause exists.

     (D) A “Change in Control” shall be deemed to have occurred if the event set forth in any one
of the following paragraphs shall have occurred:

               (i) the acquisition by any person (as defined under Section 409A of the Code), or more than
one person acting as a group (as defined under Section 409A of the Code), of stock of the Company
that, together with the stock of the Company held by such person or group, constitutes more than
fifty percent (50%) of the total fair market value or total voting power of the stock of the
Company;

               (ii) the acquisition by any person, or more than one person acting as a group, within any
twelve (12) month period, of stock of the Company possessing thirty percent (30%) or more of the
total voting power of the stock of the Company;

               (iii) a majority of the members of the Board are replaced during any twelve (12) month period
by directors whose appointment or election is not endorsed by a majority of the members of the
Board prior to the date of the appointment or election; or

               (iv) the acquisition by any person, or more than one person acting as a group, within any
twelve (12) month period, of assets from the Company that have a total gross fair market value
equal to or more than forty percent (40%) of the total gross fair market value of all of the assets
of the Company immediately prior to such acquisition or acquisitions.

     This definition of Change in Control shall be interpreted in a manner that is consistent with
the definition of a “change in control event” under Section 409A of the Code and the Treasury
Regulations promulgated thereunder.

     Notwithstanding the foregoing, a Change in Control shall not be deemed to have occurred if
there is consummated any transaction or series of integrated transactions immediately following
which the record holders of the common stock of the Company immediately prior to such transaction
or series of transactions continue to have substantially the same proportionate ownership in an
entity which owns all or substantially all of the assets of the Company immediately following such
transaction or series of transactions.

     Further, notwithstanding the foregoing, any event or transaction which would otherwise
constitute a Change in Control (a “Transaction”) shall not constitute a Change in Control for
purposes of this Agreement if, in connection with the Transaction, the Employee participates as

-13-

 

an equity investor in the acquiring entity or any of its affiliates (the “Acquiror”). For purposes
of the preceding sentence, the Employee shall not be deemed to have participated as an equity
investor in the Acquiror by virtue of: (i) obtaining beneficial ownership of any equity interest in
the Acquiror as a result of the grant to the Employee of an incentive compensation award under one
or more incentive plans of the Acquiror (including, but not limited to, the conversion in
connection with the Transaction of incentive compensation awards of the Company into incentive
compensation awards of the Acquiror), on terms and conditions substantially equivalent to those
applicable to other employees of the Company and its Affiliates immediately prior to the
Transaction, after taking into account normal differences attributable to job responsibilities,
title and similar matters; (ii) obtaining beneficial ownership of any equity interest in the
Acquiror on terms and conditions substantially equivalent to those obtained in the Transaction by
all other stockholders of the Company; or (iii) passive ownership of less than three percent (3%)
of the stock of the Acquiror.

     (E) “Change-in-Control Protective Period” shall mean the period from the occurrence of a
Change in Control until the second anniversary of such Change in Control.

     (F) “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.

     (G) “Committee” shall mean (i) the individuals (not fewer than three in number) who,
immediately prior to a Potential Change in Control, constitute the Compensation Committee of the
Board, plus (ii) in the event that fewer than three individuals are available from the group
specified in clause (i) above for any reason, such individuals as may be appointed by the
individual or individuals so available (including for this purpose any individual or individuals
previously so appointed under this clause (ii)); provided, however, that the maximum number of
individuals constituting the Committee shall not exceed five.

     (H) “Companies” shall mean, collectively, the Employer and each entity which is now and
hereafter shall become a subsidiary of, or a parent of, the Employer, together with their
respective successors and assigns.

     (I) “Continuation Pay” shall mean those payments so described in Section 8.2 hereof.

     (J) “Date of Termination” shall have the meaning stated in Section 11.2 hereof.

     (K) “Disability” or “Disabled” shall mean: (i) the Employee is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or mental impairment
that can be expected to result in death or can be expected to last for a continuous period of not
less than twelve (12) months; or (ii) the Employee is, by reason of any medically determinable
physical or mental impairment that can be expected to result in death or can be expected to last
for a continuous period of not less than twelve (12) months, receiving income replacement benefits
for a period of not less than three (3) months under an accident and health plan covering employees
of the Employer; or (iii) the Employee is determined to be totally disabled by the Social Security
Administration or the Railroad Retirement Board.

     (L) “Disability Period” shall have the meaning stated in Section 7.2 hereof.

-14-

 

     (M) “Employee” shall mean the individual named in the first paragraph of this Agreement.

     (N) “Employer” shall mean A. Schulman, Inc. and, except in determining under Section 20(D)
hereof whether or not any Change in Control of the Employer has occurred, any successor to its
business and/or assets which assumes and agrees to perform this Agreement by operation of law, or
otherwise.

     (O) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time to
time.

     (P) “Good Reason” for termination by the Employee of the Employee’s employment shall mean the
occurrence (without the Employee’s express prior written consent) after any Change in Control, or
after any Potential Change in Control and prior to the end of the Change in Control Protective
Period, of any one of the following acts by the Employer, or failures by the Employer to act,
unless such act or failure to act is corrected prior to the Date of Termination specified in the
Notice of Termination given in respect thereof:

               (i) a diminution in the Employee’s base compensation or incentive compensation opportunity;

               (ii) the failure by the Company, to pay to the Employee any portion of the Employee’s current
compensation, or to pay to the Employee any portion of an installment of deferred compensation
under any deferred compensation program of the Employer, within seven (7) days of the date such
compensation is due;

               (iii) the failure by the Company to continue in effect any compensation plan in which the
Employee participates immediately prior to the Change in Control which is material to the
Employee’s total compensation, unless an equitable arrangement (embodied in an ongoing substitute
or alternative plan) has been made with respect to such plan, or the failure by the Company to
continue the Employee’s participation therein (or in such substitute or alternative plan) on a
basis not materially less favorable, both in terms of the amount of benefits provided and the level
of the Employee’s participation relative to other participants, as existed at the time of the
Change in Control;

               (iv) the failure by the Company to continue to provide the Employee with benefits
substantially similar to those enjoyed by the Employee under any of the Company’s pension, life
insurance, medical, health and accident, or disability plans in which the Employee was
participating at the time of the Change in Control, the taking of any action by the Company which
would directly or indirectly materially reduce any of such benefits or deprive the Employee of any
material fringe benefit enjoyed by the Employee at the time of the Change in Control, or the
failure by the Company to provide the Employee with the number of paid vacation days to which the
Employee is entitled on the basis of years of service with the Company in accordance with the
Employer’s normal vacation policy in effect at the time of the Change in Control; or

-15-

 

               (v) a diminution in the Employee’s title, authority, duties, responsibilities or reporting
relationships which are as generally described on Exhibit A;

               (vi) a diminution in the authority, duties, or responsibilities of the supervisor to whom the
Employee is required to report;

               (vii) a diminution in the budget over which the Employee retains authority;

               (viii) a reassignment of the Employee to an office location twenty-five (25) miles or more
from the office location of the Employee prior to a Change in Control, except for required travel
to an extent substantially consistent with the Employee’s business travel obligations prior to a
Change in Control;

               (ix) the failure by the Company, in the event the Employee consents to a relocation at the
request of the Company or its successor, to pay (or reimburse the Employee) for all reasonable
moving expenses incurred by the Employee relating to a change of the Employee’s principal residence
in connection with such relocation and to indemnify the Employee against any loss realized on the
sale of the Employee’s principal residence in connection with any such change of residence; or

               (x) any purported termination of the Employee’s employment which is not effected pursuant to a
Notice of Termination satisfying the requirements of Section 11.1 hereof; for purposes of this
Agreement, no such purported termination shall be effective.

     The Employee’s right to terminate the Employee’s employment for Good Reason shall not be
affected by the Employee’s incapacity due to physical or mental illness. The Employee’s continued
employment shall not constitute consent to, or a waiver of rights with respect to, any act or
failure to act constituting Good Reason hereunder.

     For purposes of any determination regarding the existence of Good Reason, any claim by the
Employee that Good Reason exists shall be presumed to be correct unless the Employer establishes to
the Committee by clear and convincing evidence that Good Reason does not exist.

     (Q) “Notice of Termination” shall have the meaning stated in Section 11.1 hereof.

     (R) “Person” shall have the meaning given in Section 3(a) (9) of the Exchange Act, as modified
and used in Sections 13(d) and 14(d) thereof, except that such term shall not include (i) the
Employer or any of its subsidiaries, (ii) a trustee or other fiduciary holding securities under an
employee benefit plan of the Employer or any of its subsidiaries, (iii) an underwriter temporarily
holding securities pursuant to an offering of such securities, or (iv) a corporation owned,
directly or indirectly, by the stockholders of the Employer in substantially the same proportions
as their ownership of stock of the Employer.

     (S) “Potential Change in Control” shall be deemed to have occurred if the event set forth in
any one of the following paragraphs shall have occurred:

-16-

 

     (i) the Employer enters into an agreement, the consummation of which would result in
the occurrence of a Change in Control;

     (ii) the Employer or any Person publicly announces an intention to take or to consider
taking actions which, if consummated, would constitute a Change in Control;

     (iii) any Person becomes the Beneficial Owner, directly or indirectly, of securities of
the Employer representing 15% or more of either the then outstanding shares of common stock
of the Employer or the combined voting power of the Employer’s then outstanding securities;
or

     (iv) the Board adopts a resolution to the effect that, for purposes of this Agreement,
a Potential Change in Control has occurred.

     (T) “Severance Payments” shall mean those payments described in Section 10.1 hereof.

     (U) “Term” shall have the meaning set forth in Section 4.1 hereof.

     (V) “Termination Pay” shall mean those payments so described in Section 8.2 hereof.

[Remainder of Page Intentionally Left Blank]

-17-

 

     21. SECTION 409A OF THE CODE

     It is intended that this Agreement comply with Section 409A of the Code and the Treasury
Regulations promulgated thereunder (and any subsequent notices or guidance issued by the Internal
Revenue Service), and this Agreement will be interpreted, administered and operated accordingly.
Nothing herein shall be construed as an entitlement to or guarantee of any particular tax treatment
to the Employee.

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed (the
corporate signatory by the respective officer duly authorized) as of the day and year first above
written.

	 	 	 	 	 	 	 

	EMPLOYEE:	EMPLOYER:
	 
	/s/ Joseph J. Levanduski
	 	A. Schulman, Inc.
	Name: 	 Joseph J. Levanduski	 	 	 
			 	By: 	            /s/ Joseph M. Gingo
	 	 	 	 	 	Joseph M. Gingo

-18-

 

Exhibit A

     As Vice President, Chief Financial Officer and Treasurer, Employee shall report directly to
the Employer’s Chief Executive Officer. Employee will have responsibility for Finance, Accounting,
Treasury and Financial Planning and Analysis, with accountability to ensure timely and accurate
budget analysis and financial review for the management team. Employee will also be responsible
for all capital expenditure evaluations, cash flow analysis, banking relationship, and financial
reporting. Employee will have such other duties and perform such other tasks as may, from time to
time, be assigned to him by the Chief Executive Officer or the Board of Directors.exv10w1

Exhibit 10.1

FIFTH AMENDMENT TO SECOND AMENDED AND RESTATED

FINANCING AND SECURITY AGREEMENT

THIS FIFTH AMENDMENT TO SECOND AMENDED AND RESTATED FINANCING AND SECURITY AGREEMENT (this
“Agreement”) is made as of the 31st day of May, 2011, by and among ARGAN, INC., a
corporation organized and in good standing under the laws of the State of Delaware, SOUTHERN
MARYLAND CABLE, INC., a corporation organized and in good standing under the laws of the State of
Delaware, GEMMA POWER, INC., a corporation organized and in good standing under the laws of the
State of Connecticut, GEMMA POWER SYSTEMS CALIFORNIA, INC., a corporation organized and in good
standing under the laws of the State of California, GEMMA POWER SYSTEMS, LLC, a limited liability
company organized and in good standing under the laws of the state of Connecticut, GEMMA POWER
HARTFORD, LLC, a limited liability company organized and in good standing under the laws of the
State of Connecticut, jointly and severally (each a “Borrower”; and collectively, the “Borrowers”),
and BANK OF AMERICA, N.A., a national banking association, its successors and assigns (the
“Lender”).

RECITALS

A. Borrowers, VITARICH LABORATORIES, INC., a corporation organized and in good standing under
the laws of the State of Delaware (“Vitarich”) and Lender are parties to a Second Amended and
Restated Financing and Security Agreement dated as of December 11, 2006 (the same, as amended,
modified, substituted, extended, and renewed from time to time, the “Financing Agreement”).

B. The Financing Agreement provides for some of the agreements between the Borrowers, Vitarich
and the Lender with respect to the Loans.

C. Pursuant to that certain Consent and Release Agreement dated as of February 1, 2011, Lender
consented to the release of Vitarich, from any and all liability under each of the Financing
Documents.

D. The Revolving Loan has matured and the Borrowers have requested that the Lender extend the
Revolving Credit Expiration Date and make certain revisions to the Financing Agreement as more
fully set forth herein.

E. Although Lender is under no obligation to do so, Lender is willing to extend the Revolving
Credit Expiration Date and amend certain provisions of the Financing Agreement on the terms and
conditions set forth in this Amendment, subject to Borrower’s compliance with the terms, covenants,
and conditions set forth in this Amendment.

 

 

 

AGREEMENTS

NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration, receipt of which is hereby acknowledged, Borrowers and Lender agree as follows:

1. Recitals. Borrowers and Lender agree that the Recitals above are a part of this
Agreement. Unless otherwise expressly defined in this Agreement, terms defined in the Financing
Agreement shall have the same meaning under this Agreement.

2. Amendments to the Financing Agreement. The Financing Agreement is hereby amended
as follows:

(a) Section 1.1 (Certain Defined Terms). The following terms and their definitions
set forth in Section 1.1 of the Financing Agreement are hereby amended by deleting each in its
entirety and replacing each with the following:

“Letter of Credit” and “Letters of Credit” shall mean collectively the Letters of
Credit as described in Section 2.3.1(a) and the Discretionary Letters of Credit as described
in Section 2.3.1(b), including any Cash Secured Letters of Credit also described in Section
2.3.3(b).

“Letter of Credit Cash Collateral Account” has the meaning described in Section
2.3.3(a) (Terms of Letters of Credit).

“Obligations” means all present and future indebtedness, duties, obligations, and
liabilities, whether now existing or contemplated or hereafter arising, of any one or more
of the Borrowers to the Lender under, arising pursuant to, in connection with and/or on
account of the provisions of this Agreement, each Note, each Security Document, and/or any
of the other Financing Documents, the Loans, any Swap Contract and/or any of the Facilities
including, without limitation, the principal of, and interest on, each Note, late charges,
the Fees, Enforcement Costs, and prepayment fees (if any), the Letter of Credit Obligations,
letter of credit fees or fees charged with respect to any guaranty of any letter of credit;
also means all other present and future indebtedness, duties, obligations, and liabilities,
whether now existing or contemplated or hereafter arising, of any one or more of the
Borrowers to the Lender or its Affiliates of any nature whatsoever, regardless of whether
such indebtedness, duties, obligations, and liabilities be direct, indirect, primary,
secondary, joint, several, joint and several, fixed or contingent; and also means any and
all renewals, extensions, substitutions, amendments, restatements and rearrangements of any
such indebtedness, duties, obligations, and liabilities.

“Permitted Uses” means with respect to the (a) Revolving Loan, the payment of expenses
incurred in the ordinary course of any Borrower’s business and for general working capital
purposes, including loans or advances to the Guarantor, (b) Acquisition Loan, to finance a
portion of the Acquisition, and (c) to provide for Letters of Credit in the ordinary course
of business.

“Revolving Credit Expiration Date” means May 31, 2013.

 

2

 

(b) Section 1.1 (Certain Defined Terms). The following terms and their respective
definitions are hereby added in their entirety in alphabetical order to Section 1.1 to the
Financing Agreement as follows:

“Cash Secured Letter of Credit” and “Cash Secured Letters of Credit” have the meanings
described in Section 2.3.1(b) (Terms of Letters of Credit).

“Cash Secured Letter of Credit Collateral Account” has the meaning described in Section
2.3.3(b) (Terms of Letters of Credit).

“Discretionary Letter of Credit” and “Discretionary Letters of Credit” have the
meanings described in Section 2.3.3(b) (Terms of Letters of Credit).

“Post-Expiration Date Letter of Credit” and “Post-Expiration Date Letters of Credit”
have the meanings described in Section 2.3.3(a) (Terms of Letters of Credit).

“Supplemental Closing Date” means May 31, 2011.

(c) Section 1.1 (Certain Defined Terms). The definitions of “Letter of Credit
Commitment” and “Letter of Credit Facility” are hereby deleted from Section 1.1 of the Financing
Agreement and all references in the Financing Agreement to “Letter of Credit Commitment” and
“Letter of Credit Facility” are hereby deleted.

(d) Section 2.1.1 (Revolving Credit Facility). Section 2.1.1 of the Financing
Agreement is hereby amended by deleting it in its entirety and replacing it as follows:

2.1.1 Revolving Credit Facility.

Subject to and upon the provisions of this Agreement, the Lender establishes a
revolving credit facility in favor of the Borrowers. The aggregate of all advances under
the Revolving Credit Facility is sometimes referred to in this Agreement as the “Revolving
Loan”.

The principal amount of Four Million Two Hundred Fifty Thousand Dollars ($4,250,000) is
the “Revolving Credit Committed Amount”.

During the Revolving Credit Commitment Period, any or all of the Borrowers may request
advances under the Revolving Credit Facility or request the Lender to issue Letters of
Credit in accordance with the provisions of this Agreement; provided that after giving
effect to any Borrower’s request the aggregate outstanding principal balance of the
Revolving Loan plus the Outstanding Letter of Credit Obligations on Letters of Credit issued
pursuant to Section 2.3.1(a) would not exceed the Revolving Credit Committed Amount.

Unless sooner paid, the unpaid Revolving Loan, together with interest accrued and
unpaid thereon, and all other Obligations shall be due and payable in full on the Revolving
Credit Expiration Date.

 

3

 

(e) Section 2.3.1 (Letters of Credit). Section 2.3.1 of the Financing Agreement is
hereby amended by deleting it in its entirety and replacing it as follows:

2.3.1 Letters of Credit.

(a) As part of the Revolving Credit Commitment, Borrowers may obtain one or more
standby letters of credit (as the same may from time to time be amended, supplemented or
otherwise modified, each a “Letter of Credit” and collectively the “Letters of Credit”) on
terms acceptable to Lender from time to time from the Supplemental Closing Date until the
Business Day preceding the Revolving Credit Termination Date. Borrowers will not be
entitled to obtain a Letter of Credit hereunder unless (i) after giving effect to the
request, the outstanding principal balance of the Revolving Loan and of the Letter of Credit
Obligations with respect to the Letters of Credit issued pursuant to this subsection (a)
would not exceed the Revolving Credit Committed Amount and (ii) the sum of the aggregate
face amount of the then outstanding Letters of Credit issued pursuant to this subsection
(including the face amount of the requested Letter of Credit) does not exceed Four Million
Two Hundred Fifty Thousand Dollars ($4,250,000). Borrowers hereby acknowledge and agree
that each Letter of Credit issued under this Section 2.3.1(a) shall be deemed in all
respects to (i) constitute Letter of Credit Obligations, (ii) be part of the Revolving
Credit Commitment, and (iii) be subject to the terms and conditions of this Agreement.

(b) In addition to the Letters of Credit issued under subsection (a) above, Borrowers
may request and Lender may issue, in the Lender’s sole and absolute discretion, which may or
may not be given, one or more standby letters of credit (as the same may from time to time
be amended, supplemented or otherwise modified, each a “Discretionary Letter of Credit” and
collectively the “Discretionary Letters of Credit”) from time to time from the Supplemental
Closing Date until the Business Day preceding the expiration of the Revolving Credit
Expiration Date. The Borrowers hereby acknowledge and agree that (i) this Section 2.3.1(b)
does not represent a commitment by the Lender to issue Discretionary Letters of Credit, (ii)
Discretionary Letters of Credit shall not be a part of the Revolving Credit Commitment,
(iii) Discretionary Letters of Credit shall be deemed in all respects to constitute Letter
of Credit Obligations, (iv) the aggregate amount of Discretionary Letters of Credit shall
not exceed Five Million Seven Hundred Fifty Thousand Dollars ($5,750,000), and (v)
Discretionary Letters of Credit shall be subject to the terms and conditions of this
Agreement.

(f) Section 2.3.2 (Letter of Credit Fees). Section 2.3.2 of the Financing Agreement
is hereby amended by deleting it in its entirety and replacing it as follows:

2.3.2 Letter of Credit Fees.

At the time of application for the issuance of each Letter of Credit, Borrowers shall
pay to Lender, a letter of credit fee (each a “Letter of Credit Fee” and collectively the
“Letter of Credit Fees”) in an amount equal to two percent (2%) per annum of the face amount
of each Letter of Credit or if a Cash Secured Letter of Credit, in an amount equal to one
percent (1%) per annum of the face amount of each Cash Secured Letter of Credit. The Letter
of Credit Fees shall be paid upon the application for each Letter of Credit and in advance
on the first (1st) day of each calendar quarter. In addition, Borrowers shall
pay to Lender all other reasonable and customary issuance,
amendment, negotiation, processing, transfer or other fees to the extent and as and
when required by the provisions of any Letter of Credit Agreement. All Letter of Credit
Fees and all such other additional fees are included in and are a part of the “Fees” payable
by Borrowers under the provisions of this Agreement and are a part of the Obligations.

 

4

 

(g) Section 2.3.3 (Terms of Letters of Credit). Section 2.3.3 of the Financing
Agreement is hereby amended by deleting it in its entirety and replacing it as follows:

2.3.3 Terms of Letters of Credit.

(a) Each Letter of Credit shall (a) be issued pursuant to a Letter of Credit Agreement
substantially in the form attached hereto as Exhibit G, and (b) expire on a date not
later than the Business Day preceding the Revolving Credit Expiration Date; provided,
however, if any Letter of Credit does have an expiration date later than the Business Day
preceding the Revolving Credit Termination Date (each a “Post-Expiration Date Letter of
Credit” and collectively, the “Post-Expiration Date Letters of Credit”), effective as of the
Business Day preceding the Revolving Credit Termination Date and without prior notice to or
the consent of the Borrowers, Lender shall make advances under the Revolving Loan for the
account of the Borrowers in the aggregate face amount of all such Letters of Credit, which
are not Cash Secured Letters of Credit. Lender shall deposit the proceeds of such advances
into one or more interest bearing accounts with and in the name of Lender and over which
Lender alone shall have exclusive power of access and withdrawal (collectively, the “Letter
of Credit Cash Collateral Account”). The Letter of Credit Cash Collateral Account is to be
held by Lender as additional collateral and security for any Letter of Credit Obligations
relating to the Post-Expiration Date Letters of Credit. Each Borrower hereby assigns,
pledges, grants and sets over to Lender a first priority security interest in, and Lien on,
all of the funds on deposit in the Letter of Credit Cash Collateral Account, together with
any and all proceeds and products thereof as additional collateral and security for the
Letter of Credit Obligations relating to the Post-Expiration Date Letters of Credit. Each
Borrower acknowledges and agrees that Lender shall be entitled to fund any draw or draft on
any Post-Expiration Date Letter of Credit from the monies on deposit in the Letter of Credit
Cash Collateral Account without notice to or consent of the Borrowers. The Borrowers
further acknowledge and agree that Lender’s election to fund any draw or draft on any
Post-Expiration Date Letter of Credit from the Letter of Credit Cash Collateral shall in no
way limit, impair, lessen, reduce, release or otherwise adversely affect Borrower’s
obligation to pay any Letter of Credit Obligations under or relating to the Post-Expiration
Date Letters of Credit. At such time as all Post-Expiration Date Letters of Credit have
expired and all Letter of Credit Obligations relating to the Post-Expiration Date Letters of
Credit have been paid in full, Lender agrees to first apply the amount of any remaining
funds on deposit in the Letter of Credit Cash Collateral Account to the then unpaid balance
of the Obligations under the Revolving Credit Facility, if any, and the balance to Borrower.

 

5

 

(b) Borrower shall also have the option to secure one or more Letters of Credit or
Discretionary Letters of Credit with cash in a deposit account maintained with Lender (as
the same may from time to time be amended, supplemented or otherwise
modified, each a “Cash Secured Letter of Credit” and collectively the “Cash Secured
Letters of Credit”). In connection with each Cash Secured Letter of Credit, Lender shall
deposit cash in the aggregate face amount of all such Cash Secured Letters of Credit into
one or more interest bearing accounts over which Lender alone shall have exclusive power of
access and withdrawal (collectively, the “Cash Secured Letter of Credit Collateral
Account”). The Cash Secured Letter of Credit Collateral Account is to be held by Lender as
collateral and security for any Cash Secured Letter of Credit and is in addition to and not
in substitution for the Collateral which also secures all Letter of Credit Obligations. In
the event that all of the Borrower’s obligations have been paid in full and all Letters of
Credit, have either been terminated or are either Cash Secured Letters of Credit or secured
by cash pursuant to the terms of Section 2.3.3(a) above for at least 90 days, Lender will
upon request, terminate its lien on the remaining Collateral. Borrower hereby assigns,
pledges, grants and sets over to Lender a first priority security interest in, and Lien on,
all of the funds held in the Cash Secured Letter of Credit Collateral Account, together with
any and all proceeds and products thereof as additional collateral and security for the Cash
Secured Letter of Credit. Borrowers acknowledge and agree that Lender shall be entitled to
fund any draw or draft on any Cash Secured Letter of Credit from the monies on deposit in
the Cash Secured Letter of Credit Collateral Account without notice to or consent of
Borrower. Borrower further acknowledges and agrees that the Lender’s election to fund any
draw or draft on any Cash Secured Letter of Credit from the Cash Secured Letter of Credit
Collateral Account shall in no way limit, impair, lessen, reduce, release or otherwise
adversely affect Borrower’s obligation to pay any Letter of Credit Obligations or Lender’s
right to apply any other Collateral to the payment of such Letters of Credit. At such time
as all Cash Secured Letters of Credit have expired and all Letter of Credit Obligations
relating to the Cash Secured Letters of Credit have been paid in full, Lender agrees to
release to Borrower the amount of any remaining funds on deposit maintained in the Cash
Secured Letter of Credit Collateral Account.

(c) The aggregate face amount of all Letters of Credit at any one time outstanding and
issued by Lender pursuant to the provisions of this Agreement, including, without
limitation, any and all Post-Expiration Date Letters of Credit, plus the amount of all such
Letters of Credit that have been paid by Lender and for which Lender has not been reimbursed
by the Borrowers in full, any unpaid Letter of Credit Fees accrued or scheduled to accrue
thereon, and less the aggregate amount of all drafts issued under or purporting to have been
issued under such Letters of Credit that have been paid by Lender and for which Lender has
been reimbursed by the Borrowers in full in accordance with Section 2.3.5 (Payments of
Letters of Credit) and the Letter of Credit Agreements, and for which Lender has no further
obligation or commitment to restore all or any portion of the amounts drawn and reimbursed,
is herein called the “Outstanding Letter of Credit Obligations”.

 

6

 

(h) Section 6.2.6 (Investments, Loans and Other Transactions). Section 6.2.6 of the
Financing Agreement is hereby amended by deleting it in its entirety and replacing it as follows:

6.2.6 Investments, Loans and Other Transactions.

Except as otherwise provided in this Agreement, none of the Borrowers will, or will
permit any of its Subsidiaries to, (a) make, assume, acquire or continue to hold any
investment in any real property (unless used in connection with its business and treated as
a Fixed or Capital Asset of any Borrower or any Subsidiary) or any Person, whether by stock
purchase, capital contribution, acquisition of indebtedness of such Person or otherwise
(including, without limitation, investments in any joint venture or partnership), (b)
guaranty or otherwise become contingently liable for the Indebtedness or obligations of any
Person, or (c) make any loans or advances, or otherwise extend credit to any Person, except:

(i) any loan or advance to an officer or employee of any Borrower or any
Subsidiary, provided that the aggregate amount of all such loans advances by all of
the Borrowers and their Subsidiaries (taken as a whole) outstanding at any time
shall not exceed Twenty-Five Thousand Dollars ($25,000);

(ii) the endorsement of negotiable instruments for deposit or collection or
similar transactions in the ordinary course of business;

(iii) any investment in Cash Equivalents, which are pledged to the Lender as
collateral and security for the Obligations;

(iv) trade credit extended to customers in the ordinary course of business;

(v) investments of the Acquired Companies held in investment accounts, as set
forth in detail and disclosed on the Schedule 2.1.5 attached hereto;

(vi) investments in the Acquired Companies under the Acquisition Documentation;

(vii) investments in the joint venture with Invenergy Wind Management LLC that
were consented to by the Lender pursuant to that certain Second Amendment to Second
Amended and Restated Financing and Security Agreement among the Borrowers and the
Lender dated June 3, 2008; and

(viii) any investment, loan, or advance in any Person organized under the laws
of any State in the United States or the District of Columbia provided the aggregate
amount invested, loaned, or advanced does not exceed Ten Million Dollars
($10,000,000) in any fiscal year (each a “Permitted Investment”), and further,
provided that each of the following conditions is satisfied at the time of, and
after giving effect to, any Permitted Investment:

(1) The Borrowers shall, on a pro forma basis, have the sum of (a) unused
availability under the Revolving Loan, plus (b) cash
and cash equivalents of the Borrowers, of not less than Twenty Million Dollars
($20,000,000);

 

7

 

(2) The Borrowers ratio of Senior Funded Debt to EBITDA, on a consolidated
basis, shall be less than 1.50 to 1.00;

(3) No Default or Event of Default shall have occurred and be continuing;

(4) Not less than five (5) Business Days prior to the closing of any Permitted
Investment, Borrowers shall have provided the Lender written notice of such
Permitted Investment, together with calculations and supporting materials which
demonstrate that the Borrowers will satisfy each of the requirements for a Permitted
Investment; and

(5) To the extent not prohibited under the terms of the documents evidencing
the Permitted Investment, if requested by the Lender, in its sole discretion, pledge
any notes, stock or other instruments received in connection with each such
Permitted Investment to the Lender as additional Collateral for the Obligations.

3. Limitation of Amendments.

(a) The amendments set forth in Section 2 above are effective for the purposes set forth
herein and shall be limited precisely as written and shall not be deemed to (a) be a consent to any
amendment, waiver or modification of any other term or condition of any Financing Document, or (b)
otherwise prejudice any right or remedy which Lender may now have or may have in the future under
or in connection with any Financing Document.

(b) This Agreement shall be construed in connection with and as part of the Financing
Documents and all terms, conditions, representations, warranties, covenants and agreements set
forth in the Financing Documents, except as herein amended, are hereby ratified and confirmed and
shall remain in full force and effect.

4. Renewal Fee. In consideration of the Lender’s agreement to extend the Revolving
Credit Facility and enter into this Agreement, the Borrowers agree to pay to the Lender at the time
of the execution and delivery of this Agreement, a loan fee in the amount of Fifteen Thousand
Dollars ($15,000) (the “Renewal Fee”). The Renewal Fee is considered earned when paid and is not
refundable.

5. Counterparts. This Agreement may be executed in any number of duplicate originals
or counterparts, each of such duplicate originals or counterparts shall be deemed to be an original
and all taken together shall constitute but one and the same instrument. Each Borrower agrees that
Lender may rely on a telecopy of any signature of any Borrower. The Lender agrees that the
Borrowers may rely on a telecopy of this Agreement executed by the Lender.

 

8

 

6. Representations. Each Borrower hereby represents and warrants that:

(a) Borrowers have the power and authority to execute and deliver this Agreement and perform
their respective obligations hereunder and have taken all necessary and appropriate action to
authorize the execution, delivery and performance of this Agreement

(b) The Financing Agreement, as heretofore amended and as amended by this Agreement, and each
of the other Financing Documents remains in full force and effect, and each constitutes the valid
and legally binding obligation of each Borrower, enforceable in accordance with its terms;

(c) Except for those representations and warranties which relate to a specific date, all of
Borrower’s representations and warranties contained in the Financing Agreement and the other
Financing Documents are true and correct on and as of the date of each Borrower’s execution of this
Agreement and the Borrowers have performed or observed all of the terms, covenants, conditions and
obligations of the Financing Agreement and the other Financing Documents, which are required to be
performed or observed by any or all of them on or prior to the date hereof;

(d) No Event of Default and no event which, with notice, lapse of time or both would
constitute an Event of Default, has occurred and is continuing under the Financing Agreement or the
other Financing Documents which has not been waived in writing by the Lender; and

7. Conditions Precedent. The agreements of the Lender under this Agreement are
subject to the following conditions precedent:

(a) Payment to Lender of the Renewal Fee;

(b) Payment of the fees described in Paragraph 8 of this Agreement, together with the Lender’s
legal fees and expenses; and

(c) Such other information, instruments, documents, certificates and reports as the Lender may
deem necessary in its reasonable discretion.

8. Fees and Expenses. The Borrowers shall pay at the time this Agreement is executed
and delivered all fees, commissions, costs, charges, taxes and other expenses incurred by the
Lender and its counsel in connection with this Agreement, including, but not limited to, reasonable
fees and expenses of the Lender’s counsel and all recording fees, taxes and charges, if any.

9. Financing Documents; Governing Law; Etc. This Agreement is one of the Financing
Documents defined in the Financing Agreement and shall be governed and construed in accordance with
the laws of the State of Maryland. The headings and captions in this Agreement are for the
convenience of the parties only and are not a part of this Agreement.

 

9

 

10. Acknowledgments. The Borrowers acknowledge and warrant that the Lender has acted
in good faith and has conducted in a commercially reasonable manner its relationships with the
Borrowers in connection with this Agreement and generally in connection with the Financing
Documents and the Obligations, each Borrower hereby waiving and releasing any claims to the
contrary. Each Borrower hereby issues, ratifies and confirms the representations, warranties
and covenants contained in the Financing Agreement, as amended hereby or other Financing Documents.
The Borrowers agree that this Agreement is not intended to and shall not cause a novation with
respect to any or all of the Obligations

In addition, each Borrower hereby agrees to the execution and delivery of this Agreement and
the terms and provisions, covenants or agreements contained in this Agreement shall not in any
manner release, impair, lessen, modify, waive or otherwise limit the liability and obligations of
each Borrower under the terms of any of the Financing Documents, except as otherwise specifically
set forth in this Agreement.

11. Modifications. This Agreement may not be supplemented, changed, waived,
discharged, terminated, modified or amended, except by written instrument executed by the parties.

[SIGNATURES APPEAR ON THE FOLLOWING PAGE]

 

10

 

IN WITNESS WHEREOF, each of the parties hereto have executed and delivered this Agreement
under their respective seals as of the day and year first written above.

	 	 	 	 	 	 	 	 	 
	 	 	 	 	Borrowers:	 	 
	 
	 	 	 	 	 	 	 	 
	WITNESS/ATTEST:	 	 	 	ARGAN, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	 	 	(Seal)
	 

	 	 
	 	 	 	 

Rainer Bosselmann
	 	 
	 

	 	 	 	 	 	Chairman of the Board and President	 	 
	 
	 	 	 	 	 	 	 	 
	WITNESS/ATTEST:	 	 	 	SOUTHERN MARYLAND CABLE, INC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	 	 	(Seal)
	 

	 	 
	 	 	 	 

Arthur Trudel
	 	 
	 

	 	 	 	 	 	Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 
	WITNESS/ATTEST:	 	 	 	GEMMA POWER, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	 	 	(Seal)
	 

	 	 
	 	 	 	 

Arthur Trudel
	 	 
	 

	 	 	 	 	 	Chief Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	WITNESS/ATTEST:	 	 	 	GEMMA POWER SYSTEMS CALIFORNIA, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	 	 	(Seal)
	 

	 	 
	 	 	 	 

Arthur Trudel
	 	 
	 

	 	 	 	 	 	Chief Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	WITNESS/ATTEST:	 	 	 	GEMMA POWER SYSTEMS, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	 	 	(Seal)
	 

	 	 
	 	 	 	 

Daniel Martin
	 	 
	 

	 	 	 	 	 	Manager	 	 

 

 

 

	 	 	 	 	 	 	 	 	 
	WITNESS/ATTEST:	 	 	 	GEMMA POWER HARTFORD, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	 	 	(Seal)
	 

	 	 
	 	 	 	 

Daniel Martin
	 	 
	 

	 	 	 	 	 	Manager	 	 

 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	 	 	Lender:	 	 
	 
	 	 	 	 	 	 	 	 
	WITNESS:	 	 	 	BANK OF AMERICA, N.A.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	 	 	(Seal)
	 

	 	 
	 	 	 	 

Michael J. Radcliffe
	 	 
	 

	 	 	 	 	 	Senior Vice President	 	 

 

 

 

AGREEMENT OF GUARANTOR

The undersigned is the “Guarantor” under a Guaranty of Payment Agreement, dated April 26, 2010
(as amended, modified, substituted, extended and renewed from time to time, the “Guaranty”), in
favor of the Lender. In order to induce the Lender to enter into the foregoing Agreement, the
undersigned (a) consents to the transactions contemplated by, and agreements made by the Borrowers
under, the foregoing Agreement, and (b) ratifies, confirms and reissues the terms, conditions,
promises, covenants, grants, assignments, security agreements, agreements, representations,
warranties and provisions contained in the Guaranty.

WITNESS signature and seal of the undersigned as of the date of the Agreement.

	 	 	 	 	 	 	 	 	 
	WITNESS/ATTEST:	 	 	 	GEMMA RENEWABLE POWER, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	 	 	(SEAL)
	 

	 	 
	 	 	 	 

Arthur Trudel
	 	 
	 

	 	 	 	 	 	Chief Financial Officer

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00190-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00190-of-00352.parquet"}]]