Document:

EMPLOYMENT AGREEMENT

      THIS  EMPLOYMENT  AGREEMENT  ("Agreement")  is made and  entered  into and
effective  as of  the  31st  day  of  August,  2004,  by  and  between  AGAX/VLI
ACQUISITION  CORPORATION,  a Delaware corporation (the "Company"),  and KEVIN J.
THOMAS (hereinafter, the "Employee").

                                R E C I T A L S :

      WHEREAS,  Argan,  Inc.  has  acquired  all of the issued  and  outstanding
capital stock of Vitarich  Laboratories,  Inc. ("Vitarich") pursuant to a merger
between the  Company,  a wholly  owned  subsidiary  of Argan  --------  Inc.,  a
Delaware corporation ("Argan"), and Vitarich; and -----

      WHEREAS, prior to the merger, the Employee was the sole stockholder,  sole
board member and chief executive officer of Vitarich; and

      WHEREAS,  the Company is in the  business of  formulating,  packaging  and
distributing whole food, dietary, herbal and nutritional supplements and related
products,  which are marketed  globally to retail,  wholesale  and private label
customers,  including  network  marketing  companies,  health food stores,  mass
merchandisers,  drug stores,  food stores and internet and mail order  companies
(collectively, the "Business"); and

      WHEREAS,  the Employee  possesses  intimate  knowledge of the business and
affairs of the Company, its policies, methods and personnel; and

      WHEREAS,  the  Company  desires to employ  the  Employee  to  operate  the
Business and compensate him therefor; and

      WHEREAS,  the  Employee is willing to make his  services  available to the
Company and on the terms and conditions hereinafter set forth.

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

                                    Article 1

                                   Employment

      Section 1.01  Employment and Term. The Company hereby agrees to employ the
Employee  and the Employee  hereby  agrees to serve the Company on the terms and
conditions set forth herein.

      Section 1.02 Duties of Employee.  During the Term of Employment under this
Agreement,  the Employee  shall serve as the Senior  Operating  Executive of the
Company, shall faithfully and diligently perform all services as may be assigned
to him by the Board of Directors of the Company (the  "Board")  (provided  that,

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such  services  shall not  materially  differ from the services  provided by the
Employee to Vitarich),  and shall  exercise such power and authority as may from
time to time be  delegated to him by the Board.  The  Employee  shall devote his
full time and attention to the business and affairs of the Company,  render such
services to the best of his  ability,  and use his  reasonable  best  efforts to
promote the interests of the Company. Notwithstanding the foregoing or any other
provision  of this  Agreement,  it shall  not be a breach or  violation  of this
Agreement  for the Employee to: (a) serve on civic,  charitable  or,  subject to
Article 6 below, corporate boards or committees;  (b) deliver lectures,  fulfill
speaking  engagements  or  teach  at  educational  institutions;  or (c)  manage
personal investments,  so long as such activities do not significantly interfere
with  or   significantly   detract  from  the   performance  of  the  Employee's
responsibilities to the Company in accordance with this Agreement.

                                   Article 2

                                      Term

      Section 2.01 Initial  Term.  The initial  Term of  Employment  (as defined
below) under this Agreement, and the employment of the Employee hereunder, shall
commence on August 31, 2004 (the "Commencement Date") and shall expire on August
31, 2007,  unless sooner  terminated  in  accordance  with Article 5 hereof (the
"Initial Term").

      Section 2.02 Renewal  Terms.  At the end of the Initial Term,  the Term of
Employment  automatically  shall renew for successive one year terms (subject to
earlier termination as provided in Article 5 hereof),  unless the Company or the
Employee delivers written notice to the other at least three months prior to the
Expiration Date of its or his election not to renew the Term of Employment.

      Section 2.03 Term of Employment  and  Expiration  Date.  The period during
which the  Employee  shall be employed  by the Company  pursuant to the terms of
this  Agreement  is  sometimes  referred  to in this  Agreement  as the "Term of
Employment,"  and  the  date  on  which  the  Term of  Employment  shall  expire
(including  the date on which any  renewal  term  shall  expire),  is  sometimes
referred to in this Agreement as the "Expiration Date."

                                   Article 3

                                  Compensation

      Section 3.01 Base Salary.  The Employee shall receive a base salary at the
annual rate of $150,000 (the "Base Salary") during the Term of Employment,  with
such Base Salary  payable in  installments  consistent  with  Vitarich's  normal
payroll schedule,  subject to applicable  withholding and other taxes. Following
the Initial  Term,  the Base Salary shall be reviewed,  at least  annually,  for
merit  increases  and may,  by action and in the  discretion  of the  Board,  be
increased  at any time or from time to time.  Base Salary shall not be decreased
and, if increased, shall not thereafter be decreased for any reason.

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      Section 3.02 Bonuses.

            (a) In addition to Base Salary,  during the Term of Employment,  for
each  fiscal  year of the Company  following  the fiscal year ended  January 31,
2005, the Employee shall be entitled to receive  additional bonus  compensation,
provided that Pre-Tax Earnings of the Company (as defined in Section 3.02(b)(i))
for such fiscal year exceed 120% of Base Year  Pre-Tax  Earnings  (as defined in
Section  3.02(b)(ii)).  In the event  Pre-Tax  Earnings  of the Company for such
fiscal  year are  between  120%  and 130% of Base  Year  Pre-Tax  Earnings,  the
Employee shall receive Incentive Compensation (as defined below) of $150,000. In
the event  Pre-Tax  Earnings  of the Company for such fiscal year exceed 130% of
Base Year Pre-Tax Earnings, the Employee shall receive Incentive Compensation of
$250,000.

            (b) For the purposes of Section 3.02(a) above,

                  (i)  "Pre-Tax  Earnings of the Company"  shall mean,  for each
fiscal  year,  earnings  of the  Company  before  (A) taxes;  (B)  non-recurring
expenses or income  statement  adjustments  for any fiscal year, or portion of a
fiscal  year,  occurring  prior to the  date of this  Agreement,  as  reasonably
determined by the Board;  and (C) any additional  bonus  compensation  due under
Section 3.02(a),  if any; provided,  however,  that for each of the fiscal years
ended on or before  January 31,  2005 only,  "Pre-Tax  Earnings of the  Company"
shall be increased by the total  compensation  paid to the Employee  during such
each  fiscal  year and  decreased  by the Base  Salary  payable to the  Employee
pursuant to Section 3.01 above; and

                  (ii) "Base Year Pre-Tax  Earnings" shall mean, for each fiscal
year, the greater of:

                                    (A) Pre-Tax Earnings of the Company for the
                                    immediately preceding fiscal year; or

                                    (B) the average Pre-Tax Earnings of the
Company for the immediately preceding three fiscal years;

                  but in the case of both  clause (a) and clause  (b),  not less
than the Pre-Tax  Earnings of the Company for the fiscal year ended  January 31,
2005.

            (c) The Employee shall receive such additional  bonuses,  if any, as
the Board may in its sole and absolute discretion determine.

            (d) For the Bonus  Period (as  defined in Section  3.02(e)) in which
the  Employee's  employment  with the Company  terminates  for any  reason,  the
Company shall pay the Employee a pro rata portion  (based upon the period ending
on the date on which the Employee's  employment with the Company  terminates) of
the bonus  otherwise  payable  under this  Section  3.02 for the Bonus Period in
which such termination of employment occurs;  provided,  however,  that: (i) the
Bonus Period shall be deemed to end on the last day of the fiscal quarter of the

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Company in which the Employee's employment so terminates;  and (ii) the business
criteria  used to  determine  the  prorata  portion  of the bonus for this Bonus
Period  shall  be  annualized  and  shall be  determined  based  upon  unaudited
financial  information prepared in accordance with generally accepted accounting
principles,  applied  consistently with prior periods, and reviewed and approved
by the Compensation Committee of the Board. The prorata portion of the Incentive
Compensation for this Bonus Period is sometimes  hereinafter  referred to as the
"Termination Year Bonus."

            (e) Any  additional  bonus  compensation  payable  pursuant  to this
Section 3.02 is sometimes  hereinafter referred to as "Incentive  Compensation."
Each period for which Incentive  Compensation is payable under this Section 3.02
is  sometimes  hereinafter  referred to as a "Bonus  Period."  Unless  otherwise
specified  by the  Board,  the  Bonus  Period  shall be the  fiscal  year of the
Company.

            (f) Any Incentive Compensation payable pursuant to this Section 3.02
shall be determined  and paid by the Company to the Employee  within thirty (30)
days following the completion of the annual  year-end audit of Argan;  provided,
however,  that any Termination  Year Bonus payable pursuant to this Section 3.02
shall be paid by the Company to the  Employee  within  sixty (60) days after the
end of the short Bonus Period for which it is payable.

                                   Article 4

                    Expense Reimbursement and Other Benefits.

      Section 4.01  Reimbursement  of Expenses.  Upon the  submission  of proper
substantiation by the Employee,  and subject to such rules and guidelines as the
Company  may from  time to time  adopt  with  respect  to the  reimbursement  of
expenses of executive  personnel,  the Company shall  reimburse the Employee for
all  reasonable  expenses  actually paid or incurred by the Employee  during the
Term of Employment in the course of and pursuant to the business of the Company.
The Employee  shall account to the Company in writing for all expenses for which
reimbursement  is sought and shall supply to the Company  copies of all relevant
invoices, receipts or other evidence reasonably requested by the Company.

      Section 4.02 Compensation/Benefit Programs. During the term of Employment,
the  Employee  shall  be  entitled  to  participate  in  all  medical,   dental,
hospitalization, accidental death and dismemberment, disability, travel and life
insurance  plans,  and any and all other plans as are presently and  hereinafter
offered by the Company or Argan to its executive  personnel,  including savings,
pension,  profit-sharing and deferred compensation plans, subject to the general
eligibility and participation provisions set forth in such plans.

      Section  4.03  Working  Facilities.  During  the Term of  Employment,  the
Company  shall furnish the Employee  with an office,  secretarial  help and such
other  facilities  and  services  suitable to his  position and adequate for the
performance of his duties hereunder.

      Section 4.04 Stock  Options.  During the Term of  Employment  the Employee
shall be eligible to be granted options (the "Stock Options") to purchase common
stock (the "Common  Stock") of Argan under  Argan's  2001 Stock Option Plan,  as

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<PAGE>

amended  and as it may be  amended  from  time  to  time  hereinafter,  and  any
successor  plan thereto (the "Stock Option  Plan"),  subject to all of the terms
and  conditions  of the Stock Option Plan and all rules and  regulations  of the
Securities  and  Exchange  Commission  applicable  to stock option plans then in
effect.  The  number of Stock  Options  and terms  and  conditions  of the Stock
Options shall be determined by the committee of the Board appointed  pursuant to
the Stock Option Plan, or by the Board,  in its  discretion  and pursuant to the
Stock Option Plan.

      Section 4.05 Other  Benefits.  The Employee  shall be entitled to four (4)
weeks  of paid  vacation  each  calendar  year  during  the  Term of  Employment
(prorated for any partial  calendar year during the Term of  Employment),  to be
taken at such times as the Employee and the Company shall mutually determine and
provided that no vacation  time shall  significantly  interfere  with the duties
required to be rendered by the Employee  hereunder.  Any vacation time not taken
by  Employee  during  any  calendar  year may not be  carried  forward  into any
succeeding  calendar year. The Employee shall receive such additional  benefits,
if any, as the Board shall from time to time determine.

      Section  4.06  Withholding.  Anything in this  Agreement  to the  contrary
notwithstanding,  all payments  required to be made by the Company  hereunder to
the Employee or his estate or beneficiaries  shall be subject to the withholding
of such  amounts  relating to taxes as the Company may  reasonably  determine it
should  withhold  pursuant  to any  applicable  law or  regulation.  In  lieu of
withholding  such  amounts,  in whole or in part,  the Company  may, in its sole
discretion,  accept other  provisions  for payment of taxes and  withholding  as
required by law, provided it is satisfied that all requirements of law affecting
its responsibilities to withhold have been satisfied.

                                   Article 5

                                  Termination.

      Section 5.01  Termination  for Cause.  The Company shall at all times have
the  right,  upon  written  notice to the  Employee,  to  terminate  the Term of
Employment for Cause as defined below. For purposes of this Agreement,  the term
"Cause" shall mean: (a) an action or omission of the Employee which  constitutes
a willful and  material  breach of, or willful and  material  failure or refusal
(other than by reason of his  disability  or  incapacity)  to perform his duties
under,  this  Agreement,  which is not cured within 15 days after receipt by the
Employee of written notice of same; (b) fraud, embezzlement, misappropriation of
funds or breach of trust in  connection  with his services  hereunder;  or (c) a
conviction of any crime which involves  dishonesty or a breach of trust;  or (d)
gross  negligence in connection  with the  performance of the Employee's  duties
hereunder,  which is not  cured (to the  extent  curable)  within 15 days  after
receipt by the Employee of written  notice of same.  Any  termination  for Cause
shall be made by notice in writing to the Employee, which notice shall set forth
in reasonable detail all acts or omissions upon which the Company is relying for
such  termination.  Upon termination of the Term of Employment  pursuant to this
Section 5.01, the Company shall:  (i) immediately pay to the Employee any unpaid
Base Salary through the effective date of termination  ("Termination Date"); and
(ii)  pay to the  Employee  his  Termination  Year  Bonus,  if any,  at the time
provided in Section 3.02. Upon any termination effected and compensated pursuant
to this Section  5.01,  the Company  shall have no further  liability  hereunder
(other than for reimbursement for reasonable business expenses incurred prior to
the Termination Date, subject, however, to the provisions of Section 4.01).

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<PAGE>

      Section 5.02  Disability.  In the event the Employee  shall be unable,  or
fail, to perform the essential  functions of his/her  position,  with or without
reasonable  accommodation,  for any  period  of ninety  (90)  days or more,  the
Company shall have the option,  in accordance  with applicable law, to terminate
the Term of Employment upon written notice to the Employee.  Upon termination of
the Term of Employment  pursuant to this Section 5.02,  the Company  shall:  (a)
immediately  pay to the Employee any unpaid Base Salary through the  Termination
Date specified in such notice;  and (b) pay to the Employee his Termination Year
Bonus,  if any,  at the time  provided  in Section  3.02.  Upon any  termination
effected and  compensated  pursuant to this Section 5.02, the Company shall have
no further  liability  hereunder  (other than for  reimbursement  for reasonable
business expenses incurred prior to the Termination  Date,  subject,  however to
the  provisions  of  Section  4.01).  Any  payments  to the  Employee  under any
disability income policies  maintained by the Company shall offset the Company's
obligation  to pay  compensation  to  the  Employee  during  the  period  of any
disability.

      Section  5.03  Death.  Upon the death of the  Employee  during the Term of
Employment, the Company shall: (a) immediately pay to the estate of the deceased
Employee any unpaid Base Salary  through the Employee's  date of death;  and (b)
pay to the estate of the  deceased  Employee  the  Employee's  Termination  Year
Bonus,  if any,  at the time  provided  in Section  3.02.  Upon any  termination
effected and  compensated  pursuant to this Section 5.03, the Company shall have
no further  liability  hereunder  (other than for  reimbursement  for reasonable
business expenses  incurred prior to the date of the Employee's death,  subject,
however to the provisions of Section 4.01).

      Section 5.04 Termination Without Cause. At any time the Company shall have
the right to terminate the Term of Employment by written  notice to the Employee
not less than 30 days prior to the Termination  Date. Upon termination  pursuant
to this  Section  5.04 (that is not a  termination  under any of Sections  5.01,
5.02, 5.03, or 5.05), the Company shall: (a) immediately pay to the Employee any
unpaid Base Salary through the  Termination  Date specified in such notice;  (b)
continue  to pay the  Employee's  Base  Salary for a period  (the  "Continuation
Period")  through  the date on which the Term of  Employment  would  have  ended
pursuant to Article 2 hereof in the absence of an earlier  termination  pursuant
to this Article 5, in the manner and at such times as the Base Salary  otherwise
would  have  been  payable  to the  Employee;  (c)  except  as set  forth in the
following  clause (e),  continue to provide the Employee  with benefits that are
comparable,  in the  aggregate,  to the benefits he was receiving  under Section
4.02 hereof (the "Benefits"),  through the end of the Continuation Period in the

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manner and at such times as the Benefits  otherwise  would have been provided to
the Employee; (d) pay to the Employee his Termination Year Bonus, if any, at the
time provided in Section 3.02;  and (e) pay to the Employee as a single lump sum
payment, within 30 days of the Termination Date, a lump sum benefit equal to the
value of the portion of his benefits under any savings,  pension, profit sharing
or deferred  compensation plans that are forfeited under such plans by reason of
the termination of his employment hereunder prior to the end of the Continuation
Period. In the event that the Company is unable to provide the Employee with any
Benefits  required  hereunder  by reason of the  termination  of the  Employee's
employment  pursuant  to this  Section  5.04,  then the  Company  shall  pay the
Employee  cash  equal to the value of the  Benefit  that  otherwise  would  have
accrued for the  Employee's  benefit under the plan, for the period during which
such Benefits  could not be provided  under the plans,  said cash payments to be
made monthly throughout the Continuation  Period. For this purpose, the value of
any Benefit  shall be the amount that the  Employee is required to pay to obtain
that Benefit (fully grossed up for taxes at the highest marginal rate applicable
to the Employee to the extent that the Benefit would have been received tax-free
to the Employee). Further, the Employee shall continue to vest in the Employee's
Stock Options through the end of the Continuation  Period in the same manner and
to the same extent as if his employment  hereunder terminated on the last day of
the Continuation  Period. Upon any termination effected and compensated pursuant
to this Section  5.04,  the Company  shall have no further  liability  hereunder
(other than for reimbursement for reasonable business expenses incurred prior to
the Termination Date, subject, however, to the provisions of Section 4.01).

      Section 5.05 Termination by Employee.

            (a) The Employee  shall at all times have the right to terminate the
Term of Employment by written  notice to the Company not less than 30 days prior
to the Termination  Date;  provided,  however,  that the Employee shall not have
such right to terminate  the Term of  Employment  for other than Good Reason (as
defined below) prior to the expiration of the Initial Term.

            (b) Upon  termination  of the Term of  Employment  pursuant  to this
Section 5.05 by the Employee for other than Good Reason,  the Company shall: (i)
immediately  pay to the Employee any unpaid Base Salary through the  Termination
Date specified in such notice; and (ii) pay to the Employee his Termination Year
Bonus, if any, at the time provided in Section 3.02; provided, however, that, in
addition  to any other  rights or  remedies  the  Company may have for breach of
contract  or  otherwise,  the  Company  shall have no  obligation  to pay to the
Employee  his  Termination  Year Bonus if the  Employee  terminates  the Term of
Employment  for other than Good Reason  prior to the  expiration  of the Initial
Term.  Upon any termination  effected and  compensated  pursuant to this Section
5.05,  the Company  shall have no further  liability  hereunder  (other than for
reimbursement for reasonable business expenses incurred prior to the Termination
Date, subject, however, to the provisions of Section 4.01).

            (c) Upon  termination  of the Term of  Employment  pursuant  to this
Section  5.05 by the  Employee  for Good  Reason,  the Company  shall pay to the
Employee the same amounts (and at such times),  and shall continue to compensate
for  Benefits in the same  amounts,  that would have been payable or provided by
the Company to the Employee  under Section 5.04 of this Agreement if the Term of
Employment  had  been  terminated  by  the  Company  without  Cause.   Upon  any
termination  effected and compensated pursuant to this Section 5.05, the Company
shall have no further  liability  hereunder  (other than for  reimbursement  for
reasonable  business expenses  incurred prior to the Termination Date,  subject,
however, to the provisions of Section 4.01).

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            (d) For purposes of this  Agreement,  "Good Reason" shall mean:  (i)
the  assignment  to the  Employee  of any duties  inconsistent  in any  material
respect with the Employee's  position  (including  status,  offices,  titles and
reporting requirements),  authority,  duties or responsibilities as contemplated
by Section  1.02 of this  Agreement,  excluding  for this  purpose an  isolated,
insubstantial  and  inadvertent  action  not  taken in bad  faith  and  which is
remedied by the Company  promptly  after receipt of notice  thereof given by the
Employee;  (ii) any failure by the Company to comply with any of the  provisions
of  Article 3 of this  Agreement,  other  than an  isolated,  insubstantial  and
inadvertent  failure  not  occurring  in bad faith and which is  remedied by the
Company promptly after receipt of notice thereof given by the Employee; or (iii)
unless the Employee otherwise agrees, the Company's requiring the Employee to be
based at any  office or  location  outside  of  twenty-five  (25) miles from the
Company's main facility located at 4365 Arnold Avenue, Naples,  Florida,  except
for  travel   reasonably   required  in  the   performance   of  the  Employee's
responsibilities.

                                   Article 6

                             Restrictive Covenants.

      Section 6.01 Non-competition.

            (a) At all times during the  Restricted  Period,  the Employee shall
not,  directly or indirectly,  alone or with others,  engage in any  competition
with,  or have any financial or ownership  interest in any sole  proprietorship,
corporation, company, partnership, association, venture or business or any other
person or entity (whether as an employee,  officer, director,  partner, manager,
member, agent, security holder, creditor, consultant or otherwise) that directly
or indirectly  (or through any  affiliated  entity)  competes with the Business;
provided  that such  provision  shall not apply to the  Employee's  ownership of
Common  Stock  of  Argan  or the  acquisition  by  the  Employee,  solely  as an
investment,  of securities of any issuer that is registered  under Section 12(b)
or 12(g) of the Securities Exchange Act of 1934, as amended, and that are listed
or admitted for trading on any United  States  national  securities  exchange or
that are quoted on the Nasdaq Stock Market,  or any similar  system or automated
dissemination  of quotations of securities  prices in common use, so long as the
Employee does not control,  acquire a controlling interest in or become a member
of a group which  exercises  direct or indirect  control of, more than 2% of any
class of capital stock or other indicia of ownership of such issuer.

            (b) For purposes of this Agreement, the "Restricted Period" shall be
the Term of Employment and, if the Term of Employment is terminated:  (i) by the
Company for Cause (as defined in Section 5.01);  or (ii) by the Employee for any
reason  other than Good  Reason (as  defined in Section  5.05(d)),  the one year
period  immediately   following  the  Termination  Date.   Notwithstanding   the
foregoing,  the Restricted  Period shall end in the event that the Company fails
to make any payments or provide any  Benefits  required by Article 5 hereof with
15 days of written notice from the Employee of such failure.

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      Section 6.02 Confidential Information.  The Employee shall not at any time
during the Term of  Employment  or  thereafter,  regardless  of the manner of or
reason for the termination of his employment,  divulge,  communicate, use to the
detriment of the Company or for the benefit of any other  person or persons,  or
misuse  in any  way,  any  Confidential  Information  (as  hereinafter  defined)
pertaining to the business of the Company. Any Confidential  Information or data
now or hereafter  acquired by the  Employee  with respect to the business of the
Company (which shall include, but not be limited to, information  concerning the
Company's financial  condition,  prospects,  technology,  customers,  suppliers,
sources of leads and  methods  of doing  business)  shall be deemed a  valuable,
special  and unique  asset of the Company  that is  received by the  Employee in
confidence  and as a  fiduciary,  and  Employee  shall remain a fiduciary to the
Company with respect to all of such information. For purposes of this Agreement,
"Confidential  Information" means all trade secrets and information disclosed to
the Employee or known by the Employee as a consequence  of or through the unique
position of his employment with the Company or Vitarich  (including  information
conceived,  originated,  discovered or developed by the Employee and information
acquired  by the  Company or Vitarich  from  others)  prior to or after the date
hereof,  and  not  generally  or  publicly  known  (other  than as a  result  of
unauthorized  disclosure  by the  Employee),  about the Company or its business.
Notwithstanding  the  foregoing,  nothing herein shall be deemed to restrict the
Employee from  disclosing  Confidential  Information  as required to perform his
duties under this  Agreement or to the extent  required by law.  Upon request by
the Company, the Employee shall deliver promptly to the Company upon termination
of his services for the Company,  or at any time  thereafter  as the Company may
request, all Company memoranda,  notes,  records,  reports,  manuals,  drawings,
designs,  computer  files in any  media  and  other  documents  (and all  copies
thereof)  containing  such  Confidential  Information  and all  property  of the
Company or any other Company affiliate,  which he may then possess or have under
his control.

      Section 6.03  Non-solicitation  of Employees and  Customers.  At all times
during the Restricted  Period,  the Employee shall not,  directly or indirectly,
for himself or for any other person, firm,  corporation,  company,  partnership,
association,  venture or business or any other person or entity: (a) solicit for
employment,   employ  or  attempt  to  employ  or  enter  into  any  contractual
arrangement  with any employee or former  employee of the  Company,  unless such
employee or former employee has not been employed by the Company for a period in
excess of nine (9)  months;  and/or (b) call on or solicit  any of the actual or
targeted prospective customers or clients of the Company on behalf of himself or
on behalf of any person or entity in connection  with any business that competes
with the Business  nor shall the  Employee  make known the names or addresses or
other contact information of such actual or prospective  customers or clients or
any  information  relating  in any  manner to the  Company's  trade or  business
relationships with such actual or prospective  customers or clients,  other than
in connection with the performance of Employee's duties under this Agreement.

      Section 6.04 Books and Records. All books,  records, and accounts relating
in any manner to the  customers or clients of the Company,  whether  prepared by
the Employee or otherwise  coming into the Employee's  possession,  shall be the
exclusive  property  of the Company  and shall be  returned  immediately  to the
Company  on  termination  of  the  Employee's  employment  hereunder  or on  the
Company's request at any time.

                                       9
<PAGE>

      Section 6.05 Definition of Company. Solely for purposes of this Article 6,
the term "Company" also shall include any existing or future subsidiaries of the
Company  that are  operating  during the time periods  described  herein and any
other entities that directly or indirectly,  through one or more intermediaries,
control,  are  controlled by or are under common control with the Company during
the periods described herein.

      Section 6.06  Acknowledgment  by Employee.  The Employee  acknowledges and
confirms that the restrictive  covenants  contained in this Article 6 (including
without  limitation  the length of the term of the provisions of this Article 6)
are  reasonably  necessary to protect the legitimate  business  interests of the
Company,  and are not overbroad,  overlong,  or unfair and are not the result of
overreaching,  duress or coercion of any kind. The Employee further acknowledges
and confirms that the compensation  payable to the Employee under this Agreement
is in  consideration  for the duties and obligations of the Employee  hereunder,
including the restrictive  covenants  contained in this Article 6, and that such
compensation  is  sufficient,   fair  and  reasonable.   The  Employee   further
acknowledges and confirms that his full,  uninhibited and faithful observance of
each of the  covenants  contained in this Article 6 will not cause him any undue
hardship,  financial or otherwise, and that enforcement of each of the covenants
contained herein will not impair his ability to obtain  employment  commensurate
with his abilities  and on terms fully  acceptable to him or otherwise to obtain
income  required  for the  comfortable  support  of him and his  family  and the
satisfaction  of the  needs of his  creditors.  The  Employee  acknowledges  and
confirms  that his special  knowledge  of the business of the Company is such as
would cause the Company  serious  injury or loss if he were to use such  ability
and knowledge to the benefit of a competitor or were to compete with the Company
in violation of the terms of this Article 6. The Employee  further  acknowledges
that the restrictions  contained in this Article 6 are intended to be, and shall
be, for the benefit of and shall be enforceable by, the Company's successors and
assigns.  The Employee expressly agrees that upon any breach or violation of the
provisions  of this  Article 6, the Company  shall be  entitled,  as a matter of
right,  in  addition  to any other  rights or  remedies  it may  have,  to:  (a)
temporary  and/or  permanent   injunctive  relief  in  any  court  of  competent
jurisdiction  as  described  in Section 6.9 hereof;  and (b) such damages as are
provided  at law or in  equity.  The  existence  of any claim or cause of action
against the Company or its affiliates, whether predicated upon this Agreement or
otherwise, shall not constitute a defense to the enforcement of the restrictions
contained in this Article 6.

      Section 6.07  Reformation by Court. In the event that a court of competent
jurisdiction  shall determine that any provision of this Article 6 is invalid or
more  restrictive  than permitted under the governing law of such  jurisdiction,
then only as to  enforcement of this Article 6 within the  jurisdiction  of such
court,  such  provision  shall be  interpreted or reformed and enforced as if it
provided for the maximum restriction permitted under such governing law.

                                       10
<PAGE>

      Section 6.08  Extension of Time. If the Employee  shall be in violation of
any  provision  of this Article 6, then each time  limitation  set forth in this
Article 6 shall be  extended  for a period of time  equal to the  period of time
during which such violation or violations occur. If the Company seeks injunctive
relief from such  violation in any court,  then the  covenants set forth in this
Article 6 shall be extended  for a period of time equal to the  pendency of such
proceeding including all appeals by the Employee.

      Section 6.09 Injunction.  It is recognized and hereby  acknowledged by the
parties  hereto that a breach by the Employee of any of the covenants  contained
in Article 6 of this  Agreement  will cause  irreparable  harm and damage to the
Company,  the monetary amount of which may be virtually impossible to ascertain.
As a result,  the Employee  recognizes and hereby  acknowledges that the Company
shall be  entitled to an  injunction  from any court of  competent  jurisdiction
enjoining and restraining any violation of any or all of the covenants contained
in  Article  6 of  this  Agreement  by the  Employee  or any of his  affiliates,
associates,  partners or agents,  either  directly or indirectly,  and that such
right to  injunction  shall be  cumulative  and in addition  to  whatever  other
remedies the Company may possess.

      Section 6.10 Merger  Agreement.  Notwithstanding  anything to the contrary
contained in this Agreement,  nothing herein shall limit or otherwise affect the
restrictive  covenants  applicable  to the  Employee  under and  pursuant to the
terms, covenants and conditions of that certain Agreement and Plan of Merger, of
even date  herewith  (the "Merger  Agreement")  by and among the  Employee,  the
Company,  Argan,  and Vitarich,  all of which such  restrictive  covenants shall
remain in full force and effect in accordance  with the terms and  conditions of
the Merger Agreement.

      Section 6.11 Survival.  The provisions of this Article 6 shall survive the
termination  of the  Term  of  Employment  or  expiration  of the  term  of this
Agreement.

                                   Article 7

                                   Assignment

      Section 7.01 The Company shall have the right to assign this Agreement and
its  rights  and  obligations  hereunder  in  whole,  but  not in  part,  to any
corporation  or other entity with or into which the Company may hereafter  merge
or consolidate or to which the Company may transfer all or substantially  all of
its  assets,  if in any such  case said  corporation  or other  entity  shall by
operation of law or expressly in writing  assume all  obligations of the Company
hereunder as fully as if it had been originally made a party hereto, but may not
otherwise  assign this Agreement or its rights and  obligations  hereunder.  The
Employee may not assign or transfer this  Agreement or any rights or obligations
hereunder.

                                   Article 8

                                 Miscellaneous.

      Section 8.01 Benefits;  Binding  Effect.  This Agreement  shall be for the
benefit of and  binding  upon the  parties  hereto and their  respective  heirs,
personal representatives, legal representatives, successors and, where permitted
and applicable,  assigns,  including,  without limitation,  any successor to the
Company,  whether by  merger,  consolidation,  sale of stock,  sale of assets or
otherwise.

                                       11
<PAGE>

      Section 8.02 Severability. The invalidity of any one or more of the words,
phrases, sentences, clauses, provisions,  sections or articles contained in this
Agreement shall not affect the  enforceability of the remaining portions of this
Agreement or any part thereof, all of which are inserted  conditionally on their
being  valid  in law,  and,  in the  event  that  any one or more of the  words,
phrases, sentences, clauses, provisions,  sections or articles contained in this
Agreement  shall be declared  invalid,  this Agreement  shall be construed as if
such invalid word or words, phrase or phrases, sentence or sentences,  clause or
clauses,  provisions or  provisions,  section or sections or article or articles
had not been inserted. If such invalidity is caused by length of time or size of
area, or both, the otherwise  invalid provision will be considered to be reduced
to a period or area which would cure such invalidity.

      Section  8.03  Waivers.  The waiver by either  party hereto of a breach or
violation of any term or provision  of this  Agreement  shall not operate nor be
construed as a waiver of any subsequent breach or violation.

      Section 8.04 Damages;  Attorneys Fees.  Nothing  contained herein shall be
construed  to prevent the Company or the Employee  from  seeking and  recovering
from the other damages sustained by either or both of them as a result of its or
his breach of any term or provision of this Agreement.  In the event that either
party hereto seeks to collect any damages  resulting  from, or the injunction of
any  action  constituting,  a breach of any of the terms or  provisions  of this
Agreement,  then the party found to be at fault shall pay all  reasonable  costs
and attorneys' fees of the other.

      Section 8.05 No Set-off or  Mitigation.  The Company's  obligation to make
the  payments  provided  for in this  Agreement  and  otherwise  to perform  its
obligations  hereunder  shall  not be  affected  by any  set-off,  counterclaim,
recoupment,  defense or other claim,  right or action which the Company may have
against  the  Employee  or  others.  If the  Employee's  employment  under  this
Agreement  is  terminated  in such a manner  that the  Company  continues  to be
obligated  to  pay  the  Employee   compensation  and  Benefits   following  the
Termination  Date in accordance with the terms of this  Agreement,  then in such
event the Employee  shall not be obligated to seek other  employment or take any
other action by way of mitigation of the amounts  payable to the Employee  under
any of the provisions of this  Agreement;  provided,  however,  that any amounts
earned by the Employee  from any such other  third-party  employment  during the
pay-out period shall offset the amounts  otherwise payable by the Company to the
Employee hereunder.

      Section 8.06 Section Headings. The article, section and paragraph headings
contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement.

                                       12
<PAGE>

      Section 8.07 No Third Party  Beneficiary.  Nothing expressed or implied in
this  Agreement is intended,  or shall be construed,  to confer upon or give any
person other than the Company,  the parties hereto and their  respective  heirs,
personal  representatives,  legal  representatives,   successors  and  permitted
assigns, any rights or remedies under or by reason of this Agreement.

      Section 8.08  Counterparts.  This Agreement may be executed in one or more
counterparts,  each of which shall be deemed to be an original  but all of which
together shall constitute one and the same in

      Section  8.09  Governing  Law.  This  Agreement  shall be  governed by and
construed  and enforced in  accordance  with the  internal  laws of the State of
Florida,   without  regard  to  principles  of  conflict  of  laws.Section  8.10
Jurisdiction  and Venue. The parties  acknowledge that a substantial  portion of
the  negotiations,  anticipated  performance  and  execution  of this  Agreement
occurred  or shall  occur in  Naples,  Florida,  and  that,  therefore,  without
limiting the jurisdiction or venue of any other federal or state courts, each of
the parties irrevocably and unconditionally: (a) agrees that any suit, action or
legal proceeding arising out of or relating to this Agreement which is expressly
permitted by the terms of this  Agreement to be brought in a court of law, shall
be brought in the courts of record of the State of Florida in Collier  County or
the court of the United States,  Middle District of Florida; (b) consents to the
jurisdiction  of each such court in any such  suit,  action or  proceeding;  (c)
waives any objection  which it or he may have to the laying of venue of any such
suit, action or proceeding in any of such courts; and (d) agrees that service of
any court  papers may be  effected  on such party by mail,  as  provided in this
Agreement,  or in such other manner as may be provided under  applicable laws or
court rules in such courts.

      Section  8.11 Entire  Agreement.  This  Agreement  constitutes  the entire
agreement  between the parties  hereto with respect to the subject matter hereof
and,   upon  its   effectiveness,   shall   supersede   all  prior   agreements,
understandings and arrangements, both oral and written, between the Employee and
the Company (or any of its affiliates) with respect to such subject matter. This
Agreement may not be modified in any way unless by a written  instrument  signed
by both the Company and the Employee.

      Section  8.12  Notices.  All  notices  required or  permitted  to be given
hereunder shall be in writing and shall be personally delivered by courier, sent
by registered or certified  mail,  return receipt  requested,  sent by overnight
courier,  or sent by  confirmed  facsimile  transmission  addressed as set forth
herein.  Notices  personally  delivered,  sent by facsimile or sent by overnight
courier  shall be deemed  given on the date of delivery  and  notices  mailed in
accordance  with the foregoing shall be deemed given upon the earlier of receipt
by the  addressee,  as evidenced by the return  receipt  thereof,  or three days
after  deposit in the U.S.  mail.  Notice shall be sent:  (a) if to the Company,
addressed to Argan,  Inc., One Church  Street,  Suite 302,  Rockville,  Maryland
20850, Attention: Mr. Haywood Miller; and (b) if to the Employee, to his address
as reflected on the payroll records of the Company,  or to such other address as
either  party  shall  request  by notice to the  other in  accordance  with this
provision.

                                       13
<PAGE>

                         [Signatures on following page]

                                       14
<PAGE>

      IN  WITNESS  WHEREOF,   the  undersigned  have  executed  this  Employment
Agreement as of the date first above written.

               COMPANY:

                                AGAX/VLI ACQUISITION CORPORATION

                                By:
                                   ---------------------------------------------

                                Name:
                                     -------------------------------------------

                                Title:
                                      ------------------------------------------

                                EMPLOYEE:

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

                                KEVIN J. THOMAS

                                       15THIRD AMENDMENT TO FINANCING AND SECURITY AGREEMENT

      THIS  THIRD   AMENDMENT  TO  FINANCING   AND  SECURITY   AGREEMENT   (this
"Agreement")  is made as of the 31st day of August,  2004,  by and among  Argan,
Inc. (formerly Puroflow  Incorporated)("Argan"),  a corporation organized and in
good standing under the laws of the State of Delaware,  Southern Maryland Cable,
Inc. ("SMC"), a corporation organized and in good standing under the laws of the
State   of   Delaware,   and   AGAX/VLI   Acquisition   CORPORATION   ("AGAX/VLI
Acquisition"),  a corporation  organized and in good standing  under the laws of
the  State  of  Delaware,   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. Argan and SMC (the "Original  Borrowers") and the Lender entered into a
Financing  and  Security  Agreement  dated as of August 19,  2003 (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
Original  Borrowers  and the Lender with respect to the Loans (as defined in the
Financing Agreement),  including a revolving credit facility in an amount not to
exceed  $1,750,000  and  a  term  loan  facility  in an  amount  not  to  exceed
$1,200,000.

      C. Kevin  Thomas  and Ken Manley  (the  "Stockholders"),  Argan,  VITARICH
LABORATORIES,  INC.,  a  corporation  organized  under  the laws of the State of
Florida ("VLI") and AGAX/VLI Acquisition have entered into an Agreement and Plan
of Merger,  dated  August 31, 2004 (the "Merger  Agreement"),  pursuant to which
Argan  will  acquire  VLI by  means of a  merger  of VLI with and into  AGAX/VLI
Acquisition  (the  "Merger").  Argan has  requested  that the  Lender  finance a
portion of the Merger.  The Lender has agreed to do so, on the condition,  among
others, that this Agreement be executed.

                                   AGREEMENTS

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

      1.  Recitals.  The Borrowers and the 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. Representations and Warranties.  The Borrowers represent and warrant to
the Lender as follows:

      (a) Each Borrower is a corporation duly organized, validly existing and in
good standing  under the laws of their  respective  state of  incorporation  set
forth above and is duly  qualified  to do business as a foreign  corporation  in
good  standing in every other state  wherein the conduct of its  business or the
ownership of its property requires such qualification;

<PAGE>

      (b) Each  Borrower has the power and authority to execute and deliver this
Agreement and perform its obligations  hereunder and has taken all necessary and
appropriate action to authorize the execution,  delivery and performance of this
Agreement;

      (c) 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;

      (d) All of  Borrowers'  representations  and  warranties  contained in the
Financing  Agreement and the other  Financing  Documents are true and correct on
and as of the date of Borrowers' execution of this Agreement; and

      (e) 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.

      3. Certain  Defined Terms.  The following  definitions are hereby added to
Section 1.1 of the Financing Agreement as follows:

            "Borrowing  Base"  has  the  meaning   described  in  Section  2.1.8
(Borrowing Base).

            "Borrowing  Base  Deficiency"  has the meaning  described in Section
2.1.8 (Borrowing Base).

            "Borrowing  Base Report" has the meaning  described in Section 2.1.9
(Borrowing Base Report).

            "Eligible Inventory" means the collective reference to all Inventory
of each Borrower held for sale in the ordinary course of business, valued at the
lowest  of the net  purchase  cost  or  realizable  value  with  respect  to raw
materials and the lowest of the net manufacturing  cost or realizable value with
respect to finished goods  inventory,  excluding,  however,  any Inventory which
consists of:

            (i) any Inventory located outside of the United States;

            (ii)  any  Inventory  in  which  the  Lender  has not  properly  and
unavoidably perfected the Liens of the Lender under this Agreement;

            (iii) any  Inventory  not in the actual  possession  of a  Borrower,
except to the extent provided in subsection (iv) below;

            (iv) any  Inventory  in the  possession  of a bailee,  warehouseman,
consignee  or  similar  third  party,  except to the  extent  that such  bailee,
warehouseman,  consignee  or similar  third party has entered  into an agreement
with the Lender in which such bailee,  warehouseman,  consignee or similar third
party  consents and agrees to the Lender's  Lien on such  Inventory  and to such
other terms and conditions as may be required by the Lender;

                                       2
<PAGE>

            (v) any Inventory located on premises leased or rented to a Borrower
or  otherwise  not owned by a Borrower,  unless the Lender has received a waiver
and consent  from the  lessor,  landlord  and/or  owner,  in form and  substance
satisfactory  to the Lender and from any  mortgagee of such lessor,  landlord or
owner to the extent required by the Lender;

            (vi) any Inventory the sale or other  disposition of which has given
rise to a Receivable;

            (vii)  any   Inventory   which  fails  to  meet  all  standards  and
requirements  imposed by any  Governmental  Authority over such Inventory or its
production, storage, use or sale;

            (viii)   work-in-process,    supplies,   displays,   packaging   and
promotional materials;

            (ix) any Inventory as to which the Lender determines in the exercise
of its sole and absolute discretion at any time and in good faith is not in good
condition  or  is  defective,  unmerchantable,  post-seasonal,  slow  moving  or
obsolete; and

            (x) any Inventory which the Lender in the good faith exercise of its
sole and absolute  discretion has deemed to be ineligible  because the Lender in
good  faith,  otherwise  considers  the  collateral  value to the  Lender  to be
impaired or its ability to realize such value to be insecure.

            In the event of any  dispute  under the  foregoing  criteria,  as to
whether Inventory is, or has ceased to be, Eligible  Inventory,  the decision of
the Lender in the good faith exercise of its sole and absolute  discretion shall
control.

            "Eligible  Receivable" and "Eligible  Receivables" mean, at any time
of  determination  thereof,  the  unpaid  portion  of each  account  (net of any
returns,   discounts,   claims,  credits,  charges,  accrued  rebates  or  other
allowances, offsets, deductions,  counterclaims,  disputes or other defenses and
reduced by the aggregate amount of all reserves,  limits and deductions provided
for in this  definition  and elsewhere in this  Agreement)  receivable in United
States  Dollars by a Borrower,  provided each account  conforms and continues to
conform to the following criteria to the satisfaction of the Lender:

      (a) the account arose in the ordinary course of a Borrower's business from
a bona  fide  outright  sale of  Inventory  by such  Borrower  or from  services
performed by such Borrower;

      (b) the account is a valid, legally enforceable  obligation of the Account
Debtor  and  requires  no  further  act on the  part  of any  Person  under  any
circumstances to make the account payable by the Account Debtor;

                                       3
<PAGE>

      (c) the account is based upon an enforceable order or contract, written or
oral, for Inventory shipped or for services performed, and the same were shipped
or performed in accordance with such order or contract;

      (d) if the account  arises from the sale of  Inventory,  the Inventory the
sale of which gave rise to the  account  has been  shipped or  delivered  to the
Account  Debtor on an absolute sale basis and not on a bill and hold sale basis,
a consignment sale basis, a guaranteed sale basis, a sale or return basis, or on
the basis of any other similar understanding;

      (e) if the account arises from the performance of services,  such services
have been fully rendered and do not relate to any warranty claim or obligation;

      (f) the account is evidenced by an invoice or other  documentation in form
acceptable  to the  Lender,  dated  no  later  than  the  date  of  shipment  or
performance  and  containing  only  terms  normally  offered  by the  respective
Borrower;

      (g) the  amount  shown on the  books  of a  Borrower  and on any  invoice,
certificate,  schedule  or  statement  delivered  to the Lender is owing to such
Borrower and no partial  payment has been received  unless  reflected  with that
delivery;

      (h) the  account is not  outstanding  more than  ninety (90) days from the
date of the invoice therefore;

      (i) the  account is not owing by any  Account  Debtor for which the Lender
has deemed fifty percent (50%) or more of such Account  Debtor's  other accounts
(or  any  portion  thereof)  due  to a  Borrower,  individually,  or  all of the
Borrowers collectively, to be non-Eligible Receivables;

      (j) to the extent such account is owing by an Account Debtor or a group of
affiliated  Account  Debtors  then  existing  accounts  to all of the  Borrowers
collectively  exceed in aggregate  face amount  twenty five percent (25%) of the
total Eligible Receivables of all Borrowers Receivables,  the accounts in excess
of twenty five percent (25%) shall not be Eligible Receivables;

      (k) the Account Debtor has not returned, rejected or refused to retain, or
otherwise   notified  a  Borrower   of  any  dispute   concerning,   or  claimed
nonconformity  of, any of the  Inventory or services from the sale or furnishing
of which the account arose;

      (l) the account is not subject to any present or contingent  (and no facts
exist  which  are  the  basis  for  any  future)  offset,  claim,  deduction  or
counterclaim,  dispute or  defense in law or equity on the part of such  Account
Debtor,  or any claim for credits,  allowances,  or  adjustments  by the Account
Debtor because of returned,  inferior,  or damaged  Inventory or  unsatisfactory
services, or for any other reason including,  without limitation,  those arising
on account of a breach of any express or implied representation or warranty;

                                       4
<PAGE>

      (m) the Account Debtor is not a Subsidiary or Affiliate of any Borrower or
an employee,  officer, director or shareholder (other than Kevin Thomas), of any
Borrower or any Subsidiary or Affiliate of any Borrower;

      (n)  the  Account  Debtor  is not  incorporated  or  primarily  conducting
business or otherwise  located in any jurisdiction  outside of the United States
of America, unless the Account Debtor's obligations with respect to such account
are secured by a letter of credit,  guaranty or banker's acceptance having terms
and from such issuers and confirmation  banks as are acceptable to the Lender in
its sole and absolute  discretion (which letter of credit,  guaranty or banker's
acceptance is subject to the perfected Lien of the Lender);

      (o) as to which none of the following  events has occurred with respect to
the  Account  Debtor  on  such  Account:   death  or  judicial   declaration  of
incompetency of an Account Debtor who is an individual; the filing by or against
the Account  Debtor of a request or petition  for  liquidation,  reorganization,
arrangement,  adjustment of debts,  adjudication as a bankrupt,  winding-up,  or
other relief  under the  bankruptcy,  insolvency,  or similar laws of the United
States,  any state or territory  thereof,  or any foreign  jurisdiction,  now or
hereafter in effect;  the making of any general assignment by the Account Debtor
for the benefit of creditors;  the  appointment of a receiver or trustee for the
Account  Debtor  or for any of the  assets  of the  Account  Debtor,  including,
without limitation, the appointment of or taking possession by a "custodian," as
defined in the  Federal  Bankruptcy  Code;  the  institution  by or against  the
Account Debtor of any other type of insolvency  proceeding (under the bankruptcy
laws of the United States or otherwise) or of any formal or informal  proceeding
for the dissolution or liquidation of, settlement of claims against,  or winding
up of affairs of, the Account Debtor; the sale,  assignment,  or transfer of all
or any  material  part of the  assets  of the  Account  Debtor;  the  nonpayment
generally  by the  Account  Debtor  of its  debts  as they  become  due;  or the
cessation of the business of the Account Debtor as a going concern;

      (p) the Account Debtor is not a Governmental Authority,  unless all rights
of each  Borrower  with respect to such account have been assigned to the Lender
on terms  acceptable to the Lender  pursuant to the  Assignment of Claims Act of
1940, as amended or any comparable state statute;

      (q) no  Borrower  is  indebted  in any  manner to the  Account  Debtor (as
creditor,  lessor,  supplier or  otherwise),  with the  exception  of  customary
credits,  adjustments  and/or discounts given to an Account Debtor by a Borrower
in the ordinary course of its business;

      (r) the  account  does not arise  from  services  under or  related to any
warranty obligation of a Borrower or out of service charges,  finance charges or
other fees for the time value of money;

      (s) the account is not  evidenced by chattel paper or an instrument of any
kind;

                                       5
<PAGE>

      (t) the title of the respective Borrower to the account is absolute and is
not subject to any prior assignment,  claim, Lien, or security interest,  except
Permitted Liens;

      (u) no bond or other  undertaking  by a guarantor or surety has been or is
required to be obtained, supporting the performance of any Borrower or any other
obligor in respect of any of such Borrower's  agreements with the Account Debtor
or supporting the account and any of the Account Debtor's obligations in respect
of the account;

      (v) each Borrower has the full and  unqualified  right and power to assign
and grant a security  interest  in,  and Lien on,  the  account to the Lender as
security and collateral for the payment of the Obligations;

      (w) the account is subject to a Lien in favor of the Lender, which Lien is
perfected as to the account by the filing of financing statements and which Lien
upon such filing constitutes a first priority security interest and Lien;

      (x) the  Inventory  giving rise to the account was not, at the time of the
sale thereof, subject to any Lien, except those in favor of the Lender;

      (y) the part of the account which represents a retainage shall be excluded
from Eligible  Accounts,  and to the extent any part of an account  represents a
progress  billing the Lender  reserves the right to among other things,  exclude
such  account or to lower the advance  rate of Eligible  Accounts,  or limit the
amount  of loans  which  can be made  against  progress  billings,  based on the
results of a field exam; and

      (z) the  Lender  in the good  faith  exercise  of its  sole  and  absolute
discretion  has not deemed the account  ineligible  because of uncertainty as to
the  creditworthiness  of the  Account  Debtor or because  the Lender  otherwise
considers the  collateral  value of such account to the Lender to be impaired or
its ability to realize such value to be insecure.

      In the event of any dispute,  under the foregoing criteria,  as to whether
an account is, or has ceased to be, an Eligible Receivable,  the decision of the
Lender in the good faith  exercise  of its sole and  absolute  discretion  shall
control.

      "Merger  Agreement" means that certain  agreement and plan of merger dated
August ___, 2004 by and among the  Stockholders  named  therein,  VLI, Argan and
AGAX/VLI Acquisition.

      "Merger Agreement  Documents" means  collectively the Merger Agreement and
any and all other  agreements,  documents or instruments  (together with any and
all amendments,  modifications,  and supplements thereto,  restatements thereof,
and substitutes therefore)  previously,  now or hereafter executed and delivered
by any or  all of the  Borrowers,  the  Stockholders,  or any  other  Person  in
connection with the Merger Agreement Transaction.

                                       6
<PAGE>

      "Merger  Agreement   Transaction"   means  the  stock  purchase  agreement
transaction contemplated by the provisions of the Merger Agreement.

      4.  Revised  Terms.  The  following  definitions  in  Section  1.1  of the
Financing Agreement are amended and restated in their entirety as follows:

      "Responsible  Officer"  means for  Argan,  Rainer  Bosselmann,  President,
Haywood Miller,  Executive Vice President, Art Trudel, Senior Vice President and
CFO, for SMC, Haywood Miller,  Vice President and Secretary and Art Trudel, Vice
President  and  Treasurer  and  for  AGAX/VLI  Acquisition,  Rainer  Bosselmann,
Chairman of the Board,  Art Trudel,  Vice  President  or  Treasurer  and Haywood
Miller as V.P. or Secretary.

      "Revolving Credit Expiration Date" means May 31, 2005.

      5. Revolving Credit Facility.  Section 2.1.1 of the Financing Agreement is
hereby amended and restated in its entirety 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 Three Million Five Hundred Thousand Dollars
($3,500,000) 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 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 would not exceed the lesser of (a) the Revolving Credit Committed Amount or
(b) the then most current Borrowing Base.

            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.

      6.  Procedure  for  Making  Advances  Under  the  Revolving  Loan;  Lender
Protection Loans. Section 2.1.2 of the Financing Agreement is hereby amended and
restated in its entirety as follows:

            2.1.2 Procedure for Making Advances Under the Revolving Loan; Lender
Protection Loans.

            The Borrowers may borrow under the Revolving  Credit Facility on any
Business Day.  Advances  under the Revolving Loan shall be deposited to a demand
deposit account of a Borrower with the Lender (or an Affiliate of the Lender) or
shall be otherwise  applied as directed by the  Borrowers,  which  direction the
Lender may require to be in writing.  No later than 11:00 a.m. (Eastern Time) on
the date of the requested borrowing, the Borrowers shall give the Lender oral or

                                       7
<PAGE>

written  notice (a "Loan Notice") of the amount and (if requested by the Lender)
the purpose of the requested borrowing.  Any oral Loan Notice shall be confirmed
in writing by the  Borrowers  within three (3) Business Days after the making of
the  requested  advance  under the  Revolving  Loan.  Each Loan Notice  shall be
irrevocable.

            In addition, each of the Borrowers hereby irrevocably authorizes the
Lender at any time and from time to time, without further request from or notice
to the Borrowers,  to make advances under the Revolving  Loan, and to establish,
without  duplication  reserves against the Borrowing Base, which the Lender,  in
its sole and absolute discretion,  deems necessary or appropriate to protect the
interests of the Lender,  including,  without limitation,  advances and reserves
under the  Revolving  Loan made to cover debit  balances in the  Revolving  Loan
Account,  principal of, and/or  interest on, any Loan, the  Obligations,  and/or
Enforcement  Costs,  prior to, on, or after the  termination  of other  advances
under this Agreement,  regardless of whether the outstanding principal amount of
the Revolving Loan that the Lender may advance or reserve  hereunder exceeds the
Revolving Credit Committed Amount.  Notwithstanding the foregoing,  prior to the
occurrence of any Default,  the Lender will provide  notice of any advances made
under the Revolving Loan pursuant to this provision.

      7.  Borrowing  Base.  The  following  Sections  are  hereby  added  to the
Financing  Agreement  immediately  after Section 2.1.7 as Sections 2.1.8 through
2.1.11:

            2.1.8 Borrowing Base

            As used in this Agreement,  the term  "Borrowing  Base" means at any
time, an amount equal to the aggregate of (a) eighty percent (80%) of the amount
of Eligible Receivables,  plus (b) fifty percent (50%) of the amount of Eligible
Inventory.

            The Borrowing  Base shall be computed  based on the  Borrowing  Base
Report most  recently  delivered  to and  accepted by the Lender in its sole and
absolute discretion. In the event the Borrowers fail to furnish a Borrowing Base
Report required by Section 2.1.9  (Borrowing  Base Report),  or in the event the
Lender believes that a Borrowing Base Report is no longer  accurate,  the Lender
may, in its sole and absolute discretion exercised from time to time and without
limiting its other rights and remedies under this Agreement,  suspend the making
of or limit  advances  under the Revolving  Loan.  The  Borrowing  Base shall be
subject to reduction by the amount of any Receivable or any Inventory  which was
included in the Borrowing Base but which the Lender determines fails to meet the
respective  criteria  applicable  from time to time for Eligible  Receivables or
Eligible Inventory.

            If at any time the total of the  aggregate  principal  amount of the
Revolving  Loan  exceeds  the  Borrowing   Base,  a  borrowing  base  deficiency
("Borrowing Base Deficiency") shall exist. Each time a Borrowing Base Deficiency
exists,  the  Borrowers  at the  sole  and  absolute  discretion  of the  Lender
exercised from time to time shall pay the Borrowing Base Deficiency ON DEMAND to
the Lender.

            Without  implying any  limitation  on the Lender's  discretion  with
respect to the Borrowing  Base,  the criteria for Eligible  Receivables  and for
Eligible  Inventory   contained  in  the  respective   definitions  of  Eligible
Receivables  and of  Eligible  Inventory  are in part  based  upon the  business
operations  of the  Borrowers  existing  on or about the  Closing  Date and upon
information and records furnished to the Lender by the Borrowers. If at any time
or from time to time

                                       8
<PAGE>

hereafter,  the business  operations of the Borrowers change or such information
and records  furnished to the Lender is incorrect or  misleading,  the Lender in
its  discretion,  may at any time and from time to time  during the  duration of
this  Agreement  change  such  criteria  or add new  criteria.  The  Lender  may
communicate  such changed or additional  criteria to the Borrowers  from time to
time either orally or in writing.

            2.1.9 Borrowing Base Report

            The  Borrowers  will furnish to the Lender no less  frequently  than
monthly  and at such other times as may be  requested  by the Lender a report of
the Borrowing Base (each a "Borrowing Base Report"; collectively, the "Borrowing
Base  Reports")  in  the  form  required  from  time  to  time  by  the  Lender,
appropriately completed and duly signed. The Borrowing Base Report shall contain
the amount and  payments on the  Receivables,  the value of  Inventory,  and the
calculations of the Borrowing Base, all in such detail,  and accompanied by such
supporting and other  information,  as the Lender may from time to time request.
Upon the Lender's request and upon the creation of any  Receivables,  or at such
other intervals as the Lender may require, the Borrowers will provide the Lender
with (a)  copies of  Account  Debtor  invoices;  (b)  evidence  of  shipment  or
delivery; and (c) such further schedules, documents and/or information regarding
the  Receivables  and the Inventory as the Lender may  reasonably  require.  The
items to be provided under this subsection shall be in form  satisfactory to the
Lender,  and certified as true and correct by a  Responsible  Officer (or by any
other officers or employees of the Borrower whom a Responsible Officer from time
to time  authorizes  in writing to do so), and delivered to the Lender from time
to time  solely  for the  Lender's  convenience  in  maintaining  records of the
Collateral.  Any  Borrower's  failure to deliver any of such items to the Lender
shall not affect, terminate,  modify, or otherwise limit the Liens of the Lender
on the Collateral.

            2.1.10 Mandatory Prepayments of Revolving Loan.

            The  Borrowers  shall  make  the  mandatory   prepayments   (each  a
"Revolving  Loan Mandatory  Prepayment"  and  collectively,  the "Revolving Loan
Mandatory  Prepayments") of the Revolving Loan at any time and from time to time
in such amounts  requested by the Lender  pursuant to Section  2.1.8  (Borrowing
Base) in order to cover any Borrowing Base Deficiency.

            2.1.11 The Collateral Account.

            If the Lender requests,  the Borrowers will deposit,  or cause to be
deposited,  all Items of Payment to a bank account  designated by the Lender and
from which the Lender alone has power of access and withdrawal (the  "Collateral
Account"). When a Collateral Account is in existence, each deposit shall be made
not later than the next  Business  Day after the date of receipt of the Items of
Payment. The Items of Payment shall be deposited in precisely the form received,
except for the  endorsements  of the  Borrowers  where  necessary  to permit the
collection of any such Items of Payment,  which endorsement the Borrowers hereby
agree to make.  In the event the Borrowers  fail to do so, the Borrowers  hereby
authorize  the Lender to make the  endorsement  in the name of any or all of the
Borrowers.  During any period when a  Collateral  Account is in place,  prior to
such a deposit,  the Borrowers  will not commingle any Items of Payment with any
of the Borrowers' other funds or property, but will hold them separate and apart
in trust and for the account of the Lender.

                                       9
<PAGE>

            In  addition,  if so  directed by the Lender,  the  Borrowers  shall
direct the mailing of all Items of Payment from their Account  Debtors to one or
more post-office  boxes designated by the Lender, or to such other additional or
replacement post-office boxes pursuant to the request of the Lender from time to
time  (collectively,  the  "Lockbox").  The Lender shall have  unrestricted  and
exclusive access to the Lockbox.

            After a Collateral  Account is established,  tithe Borrowers  hereby
authorize  the  Lender to inspect  all Items of  Payment,  endorse  all Items of
Payment in the name of any or all of the  Borrowers,  and deposit  such Items of
Payment in the Collateral Account.  The Lender reserves the right,  exercised in
its sole and absolute discretion from time to time, to provide to the Collateral
Account  credit prior to final  collection of an Item of Payment and to disallow
credit for any Item of Payment  which is  unsatisfactory  to the Lender.  In the
event Items of Payment are returned to the Lender for any reason whatsoever, the
Lender may, in the exercise of its  discretion  from time to time,  forward such
Items of Payment a second time.  Any returned  Items of Payment shall be charged
back to the Collateral Account, the Revolving Loan Account, or other account, as
appropriate.

            The Lender will apply the whole or any part of the  collected  funds
credited to the Collateral  Account  against the Revolving Loan (or with respect
to Items of Payment  that are not  proceeds of Accounts or Inventory or after an
Event of Default, against any of the Obligations) or credit such collected funds
to a depository  account of any or all of the  Borrowers  with the Lender (or an
Affiliate of the Lender),  the order and method of such application to be in the
sole  discretion  of the Lender.  On the first day of each month,  the Borrowers
shall pay the Lender an amount equal to the additional interest which would have
accrued on the Revolving  Loan during the preceding  month if collections in the
Collateral  Account  during the month had been  received two (2)  Business  Days
subsequent  to their actual  receipt;  any  resulting  increase in the amount of
interest payable by the Borrowers shall be part of the Obligations.

      8. Compliance with Eligibility  Standards.  The following Section is added
to the Financing Agreement immediately after Section 4.1.28 as Section 4.1.29:

            4.1.29 Compliance with Eligibility Standards.

            Each Account and all Inventory  included in the  calculation  of the
Borrowing  Base  does and will at all  times  meet  and  comply  with all of the
standards for Eligible Receivables and Eligible Inventory. With respect to those
Accounts  which the  Lender  has deemed  Eligible  Receivables  (a) there are no
facts,   events  or   occurrences   which  in  any  way  impair  the   validity,
collectibility  or  enforceability  thereof or tend to reduce the amount payable
thereunder;  and (b) there are no  proceedings  or actions known to any Borrower
that are threatened or pending  against any Account Debtor which might result in
any material  adverse  change in the  Borrowing  Base.

      9.  Monthly  Reports  The  following  Section  is added  to the  Financing
Agreement immediately after Section 6.1.1(d):

                                       10
<PAGE>

            6.1.1(e) Monthly Reports

            The  Borrowers  shall  furnish to the Lender within twenty (20) days
after  the end of each  fiscal  month,  a  Borrowing  Base  Report  and a report
containing the following information:

                  (i) a detailed  aging  schedule of all  Receivables by Account
Debtor, in such detail, and accompanied by such supporting  information,  as the
Lender may from time to time reasonably request;

                  (ii) a detailed aging of all accounts payable by supplier,  in
such detail, and accompanied by such supporting  information,  as the Lender may
from time to time reasonably request;

                  (iii) a listing of all  Inventory by  component,  category and
location, in such detail, and accompanied by such supporting  information as the
Lender may from time to time reasonably request; and

                  (iv) such  other  information  as the  Lender  may  reasonably
request.

      10.  Financial  Covenants  Section  6.1.14 of the  Financing  Agreement is
hereby amended and restated in its entirety as follows:

            6.1.14 Financial Covenants.

            (a) Funded Debt to EBITDA. The Borrowers,  on a consolidated  basis,
will not permit the ratio of Funded Debt to EBITDA  tested as of the last day of
each of the Borrowers' fiscal quarters to be greater than 2.50 to 1.00 beginning
with the fiscal  quarter  ending January 31, 2005. For the fiscal quarter ending
January 31, 2005,  this covenant shall be calculated by  annualizing  the EBITDA
component for the prior two (2) fiscal  quarters.  For the quarter  ending April
30, 2005, this covenant shall be calculated by annualizing the EBITDA  component
for the fiscal  quarter  then  ending and the  immediately  preceding  three (3)
fiscal  quarters and commencing on July 31, 2005 and  thereafter,  this covenant
shall be calculated based on the four (4) quarter period then ending.

            (b) Fixed Charge Coverage Ratio.  The Borrowers will maintain,  on a
consolidated  basis  and  tested  as of the last  day of each of the  Borrowers'
fiscal  quarters,  a Fixed Charge  Coverage  Ratio of not less than 1.25 to 1.00
beginning  with the fiscal  quarter  ending  January  31,  2005.  For the fiscal
quarter  ending  January  31,  2005,   this  covenant  shall  be  calculated  by
annualizing  the EBITDA  component  of the Fixed Charge  Coverage  Ratio for the
prior two (2) fiscal  quarters.  For the quarter  ending  April 30,  2005,  this
covenant  shall be calculated by annualizing  the EBITDA  component of the Fixed
Charge  Coverage Ratio for the prior three (3) fiscal quarters and commencing on
July 31, 2005 and  thereafter,  this covenant  shall be calculated  based on the
four (4) quarter period then ending.

                                       11
<PAGE>

      11.  Minimum  Liquidity  and  Positive Net Income  Covenants.  The Minimum
Liquidity  and Positive Net Income  covenants  set forth in that certain  Second
Amendment To Financing and Security  Agreement  made as of the 29th day of June,
2004 by and  among  Argan,  SMC and the  Lender  are  hereby  deleted  in  their
entirety.

      12.  Field  Audit,  Financials.  The  Borrowers  agree  that  as  soon  as
available, but in no event later than October 15, 2004:

            (a) The Lender shall have completed,  at Borrowers' expense, a field
audit of the Collateral and the books and records of AGAX/VLI  Acquisition,  the
results of which must be  satisfactory  to the Lender in all material  respects;
and

            (b) The  Borrower's  shall  have  provided  to the  Lender a current
balance sheet of AGAX/VLI  Acquisition,  all in form and detail  satisfactory to
the Lender.

            (c) Upon receipt and review of the results of the field  examination
provided in (a) above,  provided such results are satisfactory to the Lender and
further provided that any changes or adjustments  which the Lender requires as a
result of such examination have been fully  implemented by Borrower,  the Lender
will release its lien on that certain $300,000 certificate of deposit previously
pledged by the Borrowers to the Lender as collateral security for the Borrower's
obligations under the Term Loan.

      13. Representations with Respect to Merger Agreement Transaction.

      The  Lender  has  received  true and  correct  photocopies  of the  Merger
Agreement and each of the other Merger Agreement Documents,  executed, delivered
and/or  furnished on or before the date of this Agreement in connection with the
Merger Agreement Transaction.  Neither the Merger Agreement nor any of the other
Merger Agreement Documents have been modified, changed, supplemented,  canceled,
amended or otherwise altered or affected,  except as otherwise  disclosed to the
Lender in writing on or before the date of this Agreement.  The Merger Agreement
Transaction  has been  effected,  closed  and  consummated  pursuant  to, and in
accordance  with, the terms and conditions of the Merger  Agreement and with all
applicable Laws.

      14. Fee. In consideration of the Bank's modifications described above, the
Borrowers  shall  pay  to  the  Lender  upon  the  date  of  this  Agreement,  a
nonrefundable fee, in the amount of Twenty Thousand Dollars  ($20,000).  The fee
is considered earned when paid and is not refundable.

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

            (a) An Amended and Restated  Revolving Credit Note (the "Replacement
Revolving Note") issued and delivered by the Borrowers in the form of EXHIBIT A_
attached hereto and  incorporated  herein by reference,  payable to the order of
the Bank in the maximum  principal amount of Three Million Five Hundred Thousand
Dollars ($3,500,000);

                                       12
<PAGE>

            (b) A First  Amendment  to Term Note (the "Term Note  Modification")
issued and delivered by the Borrowers in the form of EXHIBIT B_, and dated as of
June 29, 2004 attached hereto and incorporated herein by reference;

            (c)  An  Additional   Borrower  Joinder   Supplement  from  AGAX/VLI
Acquisition  (the  "Joinder"),  together  with all  documents,  instruments  and
deliveries required pursuant to such Additional Borrower Joinder Supplement;

            (d)  The  Lender  shall  have  received  photocopies  of all  Merger
Agreement Documents executed,  delivered and/or furnished in connection with the
Merger  Agreement   Transaction,   together  with  a  certificate  signed  by  a
Responsible  Officer  of  each  of the  Borrowers  certifying  that  the  Merger
Agreement and the other Merger Agreement  Documents  furnished to the Lender are
true, correct, in full force and effect and the provisions thereof have not been
in any way modified,  amended or waived,  the Merger  Agreement  Transaction has
been closed and completed in accordance with the Merger  Agreement and the other
Merger  Agreement  Documents  furnished to the Lender and in accordance with all
applicable Laws,  including,  any and all bulk transfer laws, the Borrowers have
given public notice of their  obligation to pay the  obligations and liabilities
assumed by the Borrowers  under, and in connection with, the Merger Agreement in
accordance with the provisions of Article 6 of the Uniform  Commercial Code, the
Borrowers  have  obtained all  consents,  licenses and approvals to permit it to
engage in the business  previously operated and conducted by the Seller, and the
Seller has duly and properly  assigned to the Borrowers all of its right,  title
and  interest  in,  and to,  any and all  Trademarks,  Copyrights  and  Patents,
together with the goodwill of the Seller  associated with, and/or symbolized by,
any of the  foregoing,  and such  assignment  has been duly and properly  filed,
registered and recorded with the United States Patent and Trademark Office,  the
United States Copyright Office and with such other state or Federal Governmental
Authorities  as may be necessary to effect and  consummate an assignment of such
Trademarks,  Copyrights and Patents, together with the goodwill associated with,
or symbolized by any of the foregoing from the Seller to the Borrowers;

            (e)  True  and  complete  copies  of  the  resolutions  of  AGAX/VLI
Acquisition  and  Argan's  Board of  Directors  authorizing  (A) the  execution,
delivery and performance of this Agreement and the Merger Agreement Documents to
which it is a party, (B) the borrowings  hereunder,  and (C) the granting of the
Liens  contemplated by this Agreement and the Joinder to which it is a party and
(E) the Merger Agreement Transaction;

            (f) The Lender shall have received copies of all consents,  licenses
and approvals, required in connection with the execution, delivery, performance,
validity and enforceability of this Agreement, the Joinder, the Merger Agreement
Documents, and such consents,  licenses and approvals shall be in full force and
effect;

            (g) All documents and instruments  (including,  without  limitation,
UCC-1  financing  statements and UCC-3  termination  statements)  required to be
filed,  registered  or  recorded in order to create,  in favor of the Lender,  a
perfected first Lien in the Collateral (subject only to the Permitted Liens), in
form and in sufficient  number for filing,  registration,  and recording in each
office  in  each   jurisdiction  in  which  such  filings,   registrations   and
recordations  are  required,  along  with such  evidence  as the Lender may deem
satisfactory  that all necessary filing fees and all recording and other similar
fees,  and all taxes and other expenses  related to such filings,  registrations
and recordings will be or have been paid in full;

                                       13
<PAGE>

            (h) Payment of the fees described in Paragraph 11 of this Agreement,
together with the Lender's legal fees and expenses; and

            (i)  Such  other  information,   instruments,  opinions,  documents,
certificates and reports as the Lender may deem necessary.

      16.  Replacement  Revolving  Credit Note. The Borrowers  shall execute and
deliver  to the  Lender on the date  hereof the  Replacement  Revolving  Note in
substitution for and not  satisfaction of, the issued and outstanding  Revolving
Credit Note, and the Replacement  Revolving Note shall be the "Revolving  Credit
Note" for all purposes of the Financing  Documents.  The Note being  substituted
pursuant  to this  Agreement  shall be marked  "Replaced"  and  returned  to the
Original Borrowers after the execution.

      17.  Ratification;  Novation.  Each Borrower  hereby issues,  ratifies and
confirms  the  representations,   warranties  and  covenants  contained  in  the
Financing Agreement, as amended hereby. Each Borrower agrees that this Agreement
is not intended to and shall not cause a novation  with respect to any or all of
the Obligations.

      18. 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.

      19. Good Faith.  Each Borrower  acknowledges  and warrants 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  Agreement and the  Obligations,  the
Borrowers hereby waiving and releasing any claims to the contrary.

      20.  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 the Lender
may rely on a telecopy of any  signature of a Borrower.  The Lender  agrees that
the Borrowers may rely on a telecopy of this Agreement executed by the Lender.

                    [SIGNATURES APPEAR ON THE FOLLOWING PAGE]

                                       14
<PAGE>

      IN WITNESS  WHEREOF,  the  Borrowers  and the Lender  have  executed  this
Agreement under seal as of the date and year first written above.

WITNESS OR ATTEST:                    ARGAN, INC.

_________________________             By:______________________(SEAL)
                                      Name:
                                      Title:

WITNESS OR ATTEST:                    SOUTHERN MARYLAND CABLE, INC.

_________________________             By:______________________(SEAL)
                                      Name:
                                      Title:

WITNESS OR ATTEST:                    AGAX/VLI ACQUISITION CORPORATION

_________________________             By:______________________(SEAL)
                                      Name:
                                      Title:

WITNESS:                              BANK OF AMERICA, N.A.

_________________________             By:______________________(SEAL)
                                      Name:
                                      Title:

                                       15

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00071-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00071-of-00352.parquet"}]]