PLEDGE, ASSIGNMENT AND SECURITY AGREEMENT
THIS
PLEDGE, ASSIGNMENT AND SECURITY AGREEMENT (this “Agreement”)
is
made this 11th
day of
December, 2006, by ARGAN, INC., a corporation organized under the laws of the
State of Delaware (the “Pledgor”)
for
the benefit of BANK OF AMERICA, N.A., a national banking association, its
successors and assigns (the “Lender”).
RECITALS
A. The
Pledgor, Southern
Maryland Cable, Inc., a corporation organized under the laws of the State of
Delaware, Vitarich Laboratories, Inc., a corporation organized under the laws
of
the State of Delaware, Gemma Power Systems, LLC, a Connecticut limited liability
company, Gemma Power, Inc., a corporation organized under the laws of the State
of Connecticut, Gemma Power Systems California, Inc., a corporation organized
under the laws of the State of California, and Gemma Power Hartford, LLC, a
limited liability company organized under the laws of the State of
Connecticut (collectively,
the “Borrowers”)
and
the
Lender have entered into a Second Amended and Restated Financing and Security
Agreement dated the same date as this Agreement (as amended, modified, restated,
substituted, extended and renewed at any time and from time to time, the
“Financing
Agreement”).
B. It
is a
condition precedent, among others, to the Lender’s agreement to enter into the
Financing Agreement and to make loans and other financial accommodations
thereunder that the Pledgor enter into this Agreement in order to secure the
full and prompt performance of all of the “Obligations”
defined
in the Financing Agreement and under all of the other Financing
Documents.
C. All
defined terms used in this Agreement and not defined in this Agreement shall
have the meaning given to such terms in the Financing Agreement.
AGREEMENTS
NOW,
THEREFORE, in consideration of the Lender’s entering into the Financing
Agreement and for other good and valuable consideration, the receipt of which
is
hereby acknowledged, the Pledgor hereby agrees as follows:
ARTICLE
I
SECURITY
|
Section
1.1
|
The
Stock Collateral.
|
As
security for the prompt and full performance of the Obligations, and as security
for the prompt and full performance of all obligations of the Pledgor under
this
Agreement, and all of the Obligations of the Pledgor and/or any other Person
under the Financing Agreement and all of the other Financing Documents, all
of
the foregoing, whether now in existence or hereafter created and whether joint,
several, or both, primary, secondary, direct, contingent or otherwise, the
Pledgor hereby pledges, assigns and grants to the Lender a security interest
in
the following property of the Pledgor (collectively, the “Stock
Collateral”),
whether now existing or hereafter created or arising:
(a) 3,900
shares of the common stock (the “Stock”)
of
Gemma Power, Inc., a corporation incorporated under the laws of the State of
Connecticut (the “Corporation”);
(b) all
stock
rights, rights to subscribe, rights to distributions, dividends (including,
but
not limited to, distributions in kind, cash dividends, stock dividends,
dividends paid in stock and liquidating dividends) and any other rights and
property interests including, but not limited to, accounts, contract rights,
instruments and general intangibles arising out of or relating to the
Corporation;
(c) all
other
or additional (or less) stock or other securities or property (including cash)
paid or distributed in respect of the Stock by way of stock-split, spin-off,
split-up, reclassification, combination of shares or similar corporate
rearrangement;
(d) all
other
or additional stock or other securities or property (including cash) which
may
be paid or distributed in respect of the Stock by reason of any consolidation,
merger, exchange of stock, conveyance of assets, liquidation or similar
corporate reorganization; and
(e) all
proceeds and products (both cash and non-cash) of the foregoing, whether now
or
hereafter arising under any of the foregoing.
|
Section
1.2
|
Rights
of the Lender in the Stock
Collateral.
|
The
Pledgor agrees that with respect to the Stock Collateral the Lender shall have
all the rights and remedies of a secured party under the Uniform Commercial
Code, as well as those provided by law and/or in this Agreement. Notwithstanding
the fact that the proceeds of the Stock Collateral constitute part of the Stock
Collateral, the Pledgor may not dispose of the Stock Collateral or any part
thereof.
|
Section
1.3
|
Rights
of the Pledgor in the Stock
Collateral.
|
Until
an
Event of Default (as that term is defined in 0
(Default
and Rights and Remedies)) occurs, the Pledgor shall be entitled (a) to vote
all
ownership or equity interests, (b) to give consents, waivers and ratification
to
any and all actions of the Corporation requiring member approval, and (c) to
receive all cash and non-cash distributions which may be paid on the Stock
Collateral and which are not otherwise prohibited by the Financing Documents.
Any cash dividend or distribution payable in respect of the Stock Collateral
which represents, in whole or in part, a return of capital or a violation of
this Agreement or the other Financing Documents shall be received by the Pledgor
in trust for the Lender, shall be paid immediately to the Lender and shall
be
retained by the Lender as part of the Stock Collateral.
ARTICLE
II
REPRESENTATIONS
AND WARRANTIES
To
induce
the Lender to advance sums to the Pledgor under the Financing Agreement, the
Pledgor represents and warrants to the Lender and shall be deemed to represent
and warrant at the time of each request for, and the time of each advance under,
the credit facilities described in the Financing Agreement, as
follows:
|
Section
2.1
|
Stock
Interests.
|
The
Stock
represents one hundred percent (100%) of the equity interests of the Corporation
and thereafter the Stock Collateral will continue to represent the same
percentage of the equity interest of the Corporation, unless otherwise permitted
under the Financing Agreement.
|
Section
2.2
|
Power
and Authority.
|
The
Pledgor has full corporate power and authority to execute and deliver this
Agreement and the other Financing Documents to which it is a party, to assign
and pledge the Stock Collateral and perform all other obligations required
hereunder with respect to the Stock Collateral and interests, and to incur
and
perform its obligations whether under this Agreement, the other Financing
Documents or otherwise, all of which have been duly authorized by all proper
and
necessary corporate action. No consent or approval of shareholders or any
creditors of the Pledgor, the Corporation, or shareholders of the Corporation,
and no consent, approval, filing or registration with or notice to any
Governmental Authority on the part of the Pledgor, is required as a condition
to
the execution, delivery, validity or enforceability of this Agreement or the
other Financing Documents or the performance of the Obligations, including,
without limitation, the right of the Lender to dispose of the Stock Collateral
following an Event of Default. The Pledgor has full right, power and authority
and has all voting rights in any corporate matters as may be represented by
the
Stock Collateral.
|
Section
2.3
|
Binding
Agreements.
|
This
Agreement and the other Financing Documents executed and delivered by the
Pledgor have been properly executed and delivered and constitute the valid
and
legally binding obligations of the Pledgor and are fully enforceable against
the
Pledgor in accordance with their respective terms, subject to bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
affecting the rights and remedies of creditors and secured parties, and general
principles of equity regardless of whether applied in a proceeding in equity
or
at law.
|
Section
2.4
|
No
Conflicts.
|
Neither
the execution, delivery and performance of the terms of this Agreement or of
any
of the other Financing Documents executed and delivered by the Pledgor nor
the
consummation of the transactions contemplated by this Agreement will conflict
with, violate or be prevented by (a) the Pledgor’s charter or bylaws, (b) any
existing mortgage, indenture, contract or agreement binding on the Pledgor
or
affecting its property, or (c) any Laws.
|
Section
2.5
|
Compliance
with Laws.
|
The
Pledgor is not in violation of any applicable Laws (including, without
limitation, any Laws relating to employment practices, to environmental,
occupational and health standards and controls) or order, writ, injunction,
decree or demand of any court, arbitrator, or any Governmental Authority
affecting the Pledgor or any of its properties, the violation of which could
adversely affect the authority of the Pledgor to enter into, or the ability
of
the Pledgor to perform under, this Agreement or any of the other Financing
Documents executed by the Pledgor.
|
Section
2.6
|
Title
to Properties.
|
The
Pledgor has good and marketable title to the Stock Collateral. The Pledgor
has
legal, enforceable and uncontested rights to use freely such property and
assets. The Pledgor is the sole owner of all of the Stock Collateral, free
and
clear of all security interests, pledges, voting trusts, agreements, Liens,
claims and encumbrances whatsoever, other than the security interest, assignment
and lien granted under this Agreement. The interests assigned as Stock
Collateral are subject to no outstanding options, voting trusts, shareholders
agreement, or other requirements with respect to such interests.
|
Section
2.7
|
Perfection
and Priority of Stock
Collateral.
|
The
Lender has, or upon execution, delivery and recording of this Agreement and
the
Security Documents will have, and will continue to have as security for the
Obligations and the other obligations secured by this Agreement, a valid and
perfected Lien on and security interest in all Stock Collateral, free of all
other Liens, claims and rights of third parties whatsoever.
ARTICLE
III
COVENANTS
Until
payment in full and the performance of all of the Obligations and all of the
obligations of the Pledgor hereunder or secured hereby, the Pledgor covenants
and agrees with the Lender as follows:
|
Section
3.1
|
Corporate
Existence.
|
The
Pledgor shall maintain its corporate existence in good standing in the
jurisdiction in which it is incorporated and in each other jurisdiction where
it
is required to register or qualify to do business if the failure to do so in
such other jurisdiction might have a material adverse effect on the ability
of
the Pledgor to perform its obligations under this Agreement, on the conduct
of
the Pledgor’s operations, on the Pledgor’s financial condition, or on the value
of, or the ability of the Lender to realize upon, the Stock
Collateral.
|
Section
3.2
|
Delivery
of Stock Collateral.
|
The
Pledgor shall deliver immediately to the Lender (a) the certificates
representing the shares of the Stock, (b) immediately upon its receipt of any
additional (or fewer) shares of stock in the Corporation, the certificates
representing such additional shares of stock, (c) all instruments, items of
payment and other Stock Collateral received by the Pledgor, and (d) executed
irrevocable, undated and blank stock powers substantially
in the form attached to this Agreement as Exhibit
A
for all
of the assigned shares of stock. All Stock Collateral at any time received
or
held by the Pledgor shall be received and held by the Pledgor in trust for
the
benefit of the Lender, and shall be kept separate and apart from, and not
commingled with, the Pledgor’s other assets.
|
Section
3.3
|
Defense
of Title and Further
Assurances.
|
The
Pledgor will do or cause to be done all things necessary to preserve and to
keep
in full force and effect its interests in the Stock Collateral, and shall
defend, at its sole expense, the title to the Stock Collateral and any part
thereof. The Pledgor hereby authorizes the filing of any financing statement
or
continuation statement required under the Uniform Commercial Code. Further,
the
Pledgor shall promptly, upon request by the Lender, execute, acknowledge and
deliver any financing statement, endorsement, renewal, affidavit, deed,
assignment, continuation statement, security agreement, certificate or other
document as the Lender may require in order to perfect, preserve, maintain,
protect, continue, realize upon, and/or extend the lien and security interest
of
the Lender under this Agreement and the priority thereof. The Pledgor shall
pay
to the Lender upon demand all taxes, costs and expenses (including but not
limited to reasonable attorney’s fees) incurred by the Lender in connection with
the preparation, execution, recording and filing of any such document or
instrument mentioned aforesaid.
|
Section
3.4
|
Compliance
with Laws.
|
The
Pledgor shall comply with all applicable Laws and observe the valid requirements
of Governmental Authorities, the noncompliance with or the nonobservance of
which might have a material adverse effect on the ability of the Pledgor to
perform its obligations under this Agreement or any of the Financing Documents
to which the Pledgor is a party or on the conduct of the Pledgor’s operations,
on the Pledgor’s financial condition, or on the value of, or the ability of the
Lender to realize upon, the Stock Collateral.
|
Section
3.5
|
Protection
of Stock Collateral.
|
The
Pledgor agrees that the Lender may at any time take such steps as the Lender
deems reasonably necessary to protect the Lender’s interest in, and to preserve
the Stock Collateral. The Pledgor agrees to cooperate fully with the Lender’s
efforts to preserve the Stock Collateral and will take such actions to preserve
the Stock Collateral as the Lender may in good faith direct. All of the Lender’s
expenses of preserving the Stock Collateral, including, without limitation,
reasonable attorneys’ fees, shall be part of the Enforcement Costs.
|
Section
3.6
|
Certain
Notices.
|
The
Pledgor will promptly notify the Lender in writing of any Event of Default
and
of any litigation, regulatory proceeding, or other event which materially and
adversely affects the value of the Stock Collateral, the ability of the Pledgor
or the Lender to dispose of the Stock Collateral, or the rights and remedies
of
the Lender in relation thereto.
|
Section
3.7
|
Books
and Records; Information.
|
(a) The
Pledgor shall maintain proper books of record and account in which full, true
and correct entries are made of all dealings and transactions in relation to
the
Stock Collateral and which reflect the Lien of the Lender thereon.
(b) The
Pledgor agrees that the Lender may from time to time and at its option (i)
require the Pledgor to, and the Pledgor shall, periodically deliver to the
Lender records and schedules, which show the status of the Stock Collateral
and
such other matters which affect the Stock Collateral; (ii) verify the Stock
Collateral and inspect the books and records of the Pledgor and make copies
thereof or extracts therefrom; (iii) notify any prospective buyers or
transferees of the Stock Collateral of the Lender’s interest in the Stock
Collateral; and (iv) disclose to prospective buyers or transferees from the
Lender any and all information regarding the Corporation, the Stock Collateral
and/or the Pledgor.
|
Section
3.8
|
Disposition
of Stock Collateral.
|
The
Pledgor will not sell, assign, convey, transfer or otherwise dispose of the
Stock Collateral or any part thereof.
|
Section
3.9
|
Distributions.
|
The
Pledgor shall receive no dividend or distribution or other benefit with respect
to the Corporation, and shall not vote, consent, waive or ratify any action
taken, which would violate or be inconsistent with any of the terms and
provisions of this Agreement, the Financing Agreement or any of the other
Financing Documents or which would materially impair the position or interest
of
the Lender in the Stock Collateral or dilute the percentage of the ownership
interests of the Corporation pledged to the Lender hereunder, except as
expressly permitted by the Financing Agreement.
|
Section
3.10
|
Liens.
|
The
Pledgor will not create, incur, assume or suffer to exist any Lien upon any
of
the Stock Collateral, other than Liens in favor of the Lender.
|
Section
3.11
|
Survival.
|
All
representations and warranties contained in or made under or in connection
with
this Agreement and the other Financing Documents shall survive the making of
any
advance under the Financing Agreement and the incurring of any other Obligations
and the other obligations secured by this Agreement.
ARTICLE
IV
DEFAULT
AND RIGHTS AND REMEDIES
|
Section
4.1
|
Events
of Default.
|
The
occurrence of any one or more of the following events shall constitute an “Event
of Default” under the provisions of this Agreement:
|
4.1.1
|
Default
under Financing Agreement.
|
An
Event
of Default shall occur under the Financing Agreement.
|
4.1.2
|
Default
under this Agreement.
|
If
the
Pledgor shall fail to duly perform, comply with or observe any of the terms,
conditions or covenants of this Agreement.
|
4.1.3
|
Breach
of Representations and
Warranties.
|
Any
representation or warranty made in this Agreement or in any report, statement,
schedule, certificate, opinion (including any opinion of counsel for the
Pledgor), financial statement or other document furnished by the Pledgor or
its
agents or representatives in connection with this Agreement, any of the other
Financing Documents, or the Obligations or the other obligations secured by
this
Agreement, shall prove to have been false or misleading when made (or, if
applicable, when reaffirmed) in any material respect.
|
Section
4.2
|
Remedies.
|
Upon
the
occurrence of any Default or Event of Default, the Lender may at any time
thereafter exercise any one or more of the following rights, powers or
remedies:
|
4.2.1
|
Uniform
Commercial Code.
|
The
Lender shall have all of the rights and remedies of a secured party under the
applicable Uniform Commercial Code and other applicable Laws. Upon demand by
the
Lender and if not previously in the possession of the Lender, the Pledgor shall
assist the Lender in the assembly of the Stock Collateral and assist in making
it available to the Lender, at a place designated by the Lender. The Lender
or
its agents may without notice from time to time enter upon the Pledgor’s
premises to take possession of the Stock Collateral, to remove it, or otherwise
to prepare it for sale, or to sell or otherwise dispose of it.
|
4.2.2
|
Sale
or Other Disposition of Stock
Collateral.
|
The
Lender may sell or redeem the Stock Collateral, or any part thereof, in one
or
more sales, at public or private sale, conducted by any officer or agent of,
or
auctioneer or attorney for, the Lender, at the Lender’s place of business or
elsewhere, for cash, upon credit or future delivery, and at such price or prices
as the Lender shall, in its sole discretion, determine, and the Lender may
be
the purchaser of any or all of the Stock Collateral so sold. Further, any
written notice of the sale, disposition or other intended action by the Lender
with respect to the Stock Collateral which is sent by regular mail, postage
prepaid, to the Pledgor at the address set forth in 0
(Notices), or such other address of the Pledgor which may from time to time
be
shown on the Lender’s records, at least ten (10) days prior to such sale,
disposition or other action, shall constitute commercially reasonable notice
to
the Pledgor. The Lender may alternatively or additionally give such notice
in
any other commercially reasonable manner. Nothing in this Agreement shall
require the Lender to give any notice not required by applicable
Laws.
If
any
consent, approval, or authorization of any Governmental Authority or any Person
having any interest therein, should be necessary to effectuate any sale or
other
disposition of the Stock Collateral, the Pledgor agrees to execute all such
applications and other instruments, and to take all other action, as may be
required in connection with securing any such consent, approval or
authorization.
The
Pledgor recognizes that the Lender may be unable to effect a public sale of
all
or a part of the Stock Collateral consisting of securities by reason of certain
prohibitions contained in the Securities Act of 1933, as amended, and other
applicable federal and state Laws. The Lender may, therefore, in its discretion,
take such steps as it may deem appropriate to comply with such Laws and may,
for
example, at any sale of the Stock Collateral consisting of securities restrict
the prospective bidders or purchasers as to their number, nature of business
and
investment intention, including, without limitation, a requirement that the
Persons making such purchases represent and agree to the satisfaction of the
Lender that they are purchasing such securities for their account, for
investment, and not with a view to the distribution or resale of any thereof.
The Pledgor covenants and agrees to do or cause to be done promptly all such
acts and things as the Lender may request from time to time and as may be
necessary to offer and/or sell the securities or any part thereof in a manner
which is valid and binding and in conformance with all applicable
Laws.
|
4.2.3
|
Specific
Rights With Regard to Stock
Collateral.
|
In
addition to all other rights and remedies provided hereunder or as shall exist
at law or in equity from time to time, the Lender may (but shall be under no
obligation to), without notice to the Pledgor, and the Pledgor hereby
irrevocably appoints the Lender as its attorney-in-fact, with power of
substitution, in the name of the Lender or in the name of the Pledgor or
otherwise, for the use and benefit of the Lender, but at the cost and expense
of
the Pledgor and without notice to the Pledgor:
(a) compromise,
extend or renew any of the Stock Collateral or deal with the same as it may
deem
advisable;
(b) make
exchanges, substitutions or surrenders of all or any part of the Stock
Collateral;
(c) copy,
transcribe, or remove from any place of business of the Pledgor all books,
records, ledger sheets, correspondence, invoices and documents, relating to
or
evidencing any of the Stock Collateral or without cost or expense to the Lender,
make such use of the Pledgor’s places of business as may be reasonably necessary
to administer, control and collect the Stock Collateral;
(d) institute
and prosecute legal and equitable proceedings to enforce collection of, or
realize upon, any of the Stock Collateral;
(e) settle,
renew, extend, compromise, compound, exchange or adjust claims in respect of
any
of the Stock Collateral or any legal proceedings brought in respect
thereof;
(f) endorse
or sign the name of the Pledgor upon any instruments, securities, powers,
documents, or other writing relating to or part of the Stock Collateral;
and
(g) take
any
other action necessary or beneficial to realize upon or dispose of the Stock
Collateral.
|
4.2.4
|
Application
of Proceeds.
|
Any
proceeds of sale or other disposition of the Stock Collateral will be applied
by
the Lender to the payment of the Enforcement Costs, and any balance of such
proceeds will be applied by the Lender to the payment of the balance of the
Obligations and the other obligations secured by this Agreement in such order
and manner of application as the Lender may from time to time in its sole and
absolute discretion determine. If the sale or other disposition of the Stock
Collateral fails to fully satisfy the Obligations and the other obligations
secured by this Agreement, the Pledgor shall remain liable to the Lender for
any
deficiency.
|
4.2.5
|
Performance
by Lender.
|
If
the
Pledgor shall fail to perform, observe or comply with any of the conditions,
covenants, terms, stipulations or agreements contained in this Agreement or
any
of the other Financing Documents, the Lender without notice to or demand upon
the Pledgor and without waiving or releasing any of the Obligations or any
Default or Event of Default, may (but shall be under no obligation to) at any
time thereafter make such payment or perform such act for the account and at
the
expense of the Pledgor, and may enter upon the premises of the Pledgor for
that
purpose and take all such action thereon as the Lender may consider necessary
or
appropriate for such purpose and the Pledgor hereby irrevocably appoints the
Lender as its attorney-in-fact to do so, with power of substitution, in the
name
of the Lender or in the name of the Pledgor or otherwise, for the use and
benefit of the Lender, but at the cost and expense of the Pledgor and without
notice to the Pledgor. All sums so paid or advanced by the Lender together
with
interest thereon from the date of payment, advance or incurring until paid
in
full at the Post-Default Rate and all costs and expenses, shall be deemed part
of the Enforcement Costs, shall be paid by the Pledgor to the Lender on demand,
and shall constitute and become a part of the Obligations.
|
4.2.6
|
Other
Remedies.
|
The
Lender may from time to time proceed to protect or enforce its rights by an
action or actions at law or in equity or by any other appropriate proceeding,
whether for the specific performance of any of the covenants contained in this
Agreement or in any of the other Financing Documents, or for an injunction
against the violation of any of the terms of this Agreement or any of the other
Financing Documents, or in aid of the exercise or execution of any right, remedy
or power granted in this Agreement, the Financing Documents, and/or applicable
Laws.
|
Section
4.3
|
Costs
and Expenses.
|
The
Pledgor shall pay on demand all costs and expenses (including reasonable
attorney’s fees), all of which shall be deemed part of the Obligations, incurred
by and on behalf of the Lender incident to any collection, servicing, sale,
disposition or other action taken by the Lender with respect to the Stock
Collateral or any portion thereof.
|
Section
4.4
|
Receipt
Sufficient Discharge to
Purchaser.
|
Upon
any
sale or other disposition of the Stock Collateral or any part thereof, the
receipt of the Lender or other Person making the sale or disposition shall
be a
sufficient discharge to the purchaser for the purchase money, and such purchaser
shall not be obligated to see to the application thereof.
|
Section
4.5
|
Remedies,
etc. Cumulative.
|
Each
right, power and remedy of the Lender as provided for in this Agreement or
in
any of the other Financing Documents or in any related instrument or agreement
or now or thereafter existing at law or in equity or by statute or otherwise
shall be cumulative and concurrent and shall be in addition to every other
right, power or remedy provided for in this Agreement or in the other Financing
Documents or in any related document, instrument or agreement or now or
hereafter existing at law or in equity or by statute or otherwise, and the
exercise or beginning of the exercise by the Lender of any one or more of such
rights, powers or remedies shall not preclude the simultaneous or later exercise
by the Lender of any or all such other rights, powers or remedies.
|
Section
4.6
|
No
Waiver, etc.
|
No
failure or delay by the Lender to insist upon the strict performance of any
term, condition, covenant or agreement of this Agreement or of any of the other
Financing Documents or of any related documents, instruments or agreements,
or
to exercise any right, power or remedy consequent upon a breach thereof, shall
constitute a waiver of any such term, condition, covenant or agreement or of
any
such breach, or preclude the Lender from exercising any such right, power or
remedy at any later time or times. By accepting payment after the due date
of
any amount payable under this Agreement or under any of the other Financing
Documents or under any related document, instrument or agreement, the Lender
shall not be deemed to waive the right either to require prompt payment when
due
of all other amounts payable under this Agreement or under any other of the
Financing Documents, or to declare a default for failure to effect such prompt
payment of any such other amount.
ARTICLE
V
MISCELLANEOUS
|
Section
5.1
|
Notices.
|
All
notices, requests and demands to or upon the parties to this Agreement shall
be
in writing and shall be deemed to have been given or made when delivered by
hand
on a Business Day, or two (2) days after the date when deposited in the mail,
postage prepaid by registered or certified mail, return receipt requested,
or
when sent by overnight courier, on the Business Day next following the day
on
which the notice is delivered to such overnight courier, addressed as
follows:
| Pledgor: |
Argan,
Inc.
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Chief
Financial Officer
|
|
with
a
copy to:
|
▇▇▇▇▇▇▇▇
& ▇▇▇▇ LLP
▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
Esq.
|
| Lender: |
Bank
of America, N.A.
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Senior
Vice President
|
| with a copy to: |
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ LLP
▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
|
By
written notice, each party to this Agreement may change the address to which
notice is given to that party, provided that such changed notice shall include
a
street address to which notices may be delivered by overnight courier in the
ordinary course on any Business Day.
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Section
5.2
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Amendments;
Waivers.
|
This
Agreement and the other Financing Documents may not be amended, modified, or
changed in any respect except by an agreement in writing signed by the Lender
and the Pledgor. No waiver of any provision of this Agreement or of any of
the
other Financing Documents, nor consent to any departure by the Pledgor
therefrom, shall in any event be effective unless the same shall be in writing.
No course of dealing between the Pledgor and the Lender and no act or failure
to
act from time to time on the part of the Lender shall constitute a waiver,
amendment or modification of any provision of this Agreement or any of the
other
Financing Documents or any right or remedy under this Agreement, under any
of
the other Financing Documents or under applicable Laws.
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Section
5.3
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Cumulative
Remedies.
|
The
rights, powers and remedies provided in this Agreement and in the other
Financing Documents are cumulative, may be exercised concurrently or separately,
may be exercised from time to time and in such order as the Lender shall
determine and are in addition to, and not exclusive of, rights, powers and
remedies provided by existing or future applicable Laws. In order to entitle
the
Lender to exercise any remedy reserved to it in this Agreement, it shall not
be
necessary to give any notice, other than such notice as may be expressly
required in this Agreement. Without limiting the generality of the foregoing,
the Lender may:
(a) proceed
against the Pledgor with or without proceeding against any other Person who
may
be liable for all or any part of the Obligations;
(b) proceed
against the Pledgor with or without proceeding under any of the other Financing
Documents or against any Collateral or other collateral and security for all
or
any part of the Obligations;
(c) without
notice, release or compromise with any guarantor or other Person liable for
all
or any part of the Obligations under the Financing Documents or otherwise;
and
(d) without
reducing or impairing the obligations of the Pledgor and without notice thereof:
(i) fail to perfect the Lien in any or all Collateral or to release any or
all
the Stock Collateral or to accept substitute collateral, (ii) waive any
provision of this Agreement or the other Financing Documents, (iii) exercise
or
fail to exercise rights of set-off or other rights, or (iv) accept partial
payments or extend from time to time the maturity of all or any part of the
Obligations.
|
Section
5.4
|
Severability.
|
In
case
one or more provisions, or part thereof, contained in this Agreement or in
the
other Financing Documents shall be invalid, illegal or unenforceable in any
respect under any Law, then without need for any further agreement, notice
or
action:
(a) the
validity, legality and enforceability of the remaining provisions shall remain
effective and binding on the parties thereto and shall not be affected or
impaired thereby;
(b) the
obligation to be fulfilled shall be reduced to the limit of such
validity;
(c) if
such
provision or part thereof pertains to repayment of the Obligations, then, at
the
sole and absolute discretion of the Lender, all of the Obligations of the
Pledgor to the Lender shall become immediately due and payable; and
(d) if
affected provision or part thereof does not pertain to repayment of the
Obligations, but operates or would prospectively operate to invalidate this
Agreement in whole or in material part, then such provision or part thereof
only
shall be void, and the remainder of this Agreement shall remain operative and
in
full force and effect.
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Section
5.5
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Successors
and Assigns.
|
This
Agreement and all other Financing Documents shall be binding upon and inure
to
the benefit of the Pledgor and the Lender and their respective heirs, personal
representatives, successors and assigns, except that the Pledgor shall not
have
the right to assign its rights hereunder or any interest herein without the
prior written consent of the Lender.
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Section
5.6
|
Applicable
Law; Jurisdiction.
|
|
5.6.1
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Applicable
Law.
|
This
Agreement, shall be governed by the Laws of the State, as if each of the
Financing Documents and this Agreement had been executed, delivered,
administered and performed solely within the State.
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5.6.2
|
Submission
to Jurisdiction.
|
The
Pledgor irrevocably submits to the jurisdiction of any state or federal court
sitting in the State over any suit, action or proceeding arising out of or
relating to this Agreement or any of the other Financing Documents. The Pledgor
irrevocably waives, to the fullest extent permitted by law, any objection that
it may now or hereafter have to the laying of the venue of any such suit, action
or proceeding brought in any such court and any claim that any such suit, action
or proceeding brought in any such court has been brought in an inconvenient
forum. Final judgment in any such suit, action or proceeding brought in any
such
court shall be conclusive and binding upon the Pledgor and may be enforced
in
any court in which the Pledgor is subject to jurisdiction, by a suit upon such
judgment, provided that service of process is effected upon the Pledgor in
one
of the manners specified in this Section or as otherwise permitted by applicable
Laws.
|
5.6.3
|
Appointment
of Agent for Service of
Process.
|
The
Pledgor hereby irrevocably designates and appoints CT Corporation System,
Corporation Trust Center, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ as
the
Pledgor’s authorized agent to receive on the Pledgor’s behalf service of any and
all process that may be served in any suit, action or proceeding of the nature
referred to in this Section in any state or federal court sitting in the State.
If such agent shall cease so to act, the Pledgor shall irrevocably designate
and
appoint without delay another such agent in the State satisfactory to the Lender
and shall promptly deliver to the Lender evidence in writing of such other
agent’s acceptance of such appointment and its agreement that such appointment
shall be irrevocable.
|
5.6.4
|
Service
of Process.
|
The
Pledgor hereby consents to process being served in any suit, action or
proceeding of the nature referred to in this Section by (a) the mailing of
a
copy thereof by registered or certified mail, postage prepaid, return receipt
requested, to the Pledgor at the Pledgor’s address designated in or pursuant to
0
(Notices), and (b) serving a copy thereof upon the agent, if any, designated
and
appointed by the Pledgor as the Pledgor’s agent for service of process by or
pursuant to this Section. The Pledgor irrevocably agrees that such service
(y)
shall be deemed in every respect effective service of process upon the Pledgor
in any such suit, action or proceeding, and (z) shall, to the fullest extent
permitted by law, be taken and held to be valid personal service upon the
Pledgor. Nothing in this Section shall affect the right of the Lender to serve
process in any manner otherwise permitted by law or limit the right of the
Lender otherwise to bring proceedings against the Pledgor in the courts of
any
jurisdiction or jurisdictions.
|
Section
5.7
|
Headings.
|
The
headings in this Agreement are included herein for convenience only, shall
not
constitute a part of this Agreement for any other purpose, and shall not be
deemed to affect the meaning or construction of any of the provisions
hereof.
|
Section
5.8
|
Entire
Agreement.
|
This
Agreement is intended by the Lender and the Pledgor to be a complete, exclusive
and final expression of the agreements contained herein. Neither the Lender
nor
the Pledgor shall hereafter have any rights under any prior agreements but
shall
look solely to this Agreement for definition and determination of all of their
respective rights, liabilities and responsibilities under this
Agreement.
|
Section
5.9
|
Waiver
of Trial by Jury.
|
THE
PLEDGOR AND THE LENDER HEREBY JOINTLY AND SEVERALLY WAIVE TRIAL BY JURY IN
ANY
ACTION OR PROCEEDING TO WHICH THE PLEDGOR AND THE LENDER MAY BE PARTIES, ARISING
OUT OF OR IN ANY WAY PERTAINING TO (A) THIS AGREEMENT, (B) ANY OF THE FINANCING
DOCUMENTS, OR (C) THE STOCK COLLATERAL. THIS WAIVER CONSTITUTES A WAIVER OF
TRIAL BY JURY OF ALL CLAIMS AGAINST ALL PARTIES TO SUCH ACTIONS OR PROCEEDINGS,
INCLUDING CLAIMS AGAINST PARTIES WHO ARE NOT PARTIES TO THIS
AGREEMENT.
This
waiver is knowingly, willingly and voluntarily made by the Pledgor and the
Lender, and the Pledgor and the Lender hereby represent that no representations
of fact or opinion have been made by any individual to induce this waiver of
trial by jury or to in any way modify or nullify its effect. The Pledgor and
the
Lender further represent that they have been represented in the signing of
this
Agreement and in the making of this waiver by independent legal counsel,
selected of their own free will, and that they have had the opportunity to
discuss this waiver with counsel.
|
Section
5.10
|
Liability
of the Lender.
|
The
Pledgor hereby agrees that the Lender shall not be chargeable for any
negligence, mistake, act or omission of any accountant, examiner, agency or
attorney employed by the Lender in making examinations, investigations or
collections, the Lender’s failure to preserve or protect any rights of the
Pledgor under the Stock Collateral or the Lender’s failure to perfect, maintain,
protect or realize upon any lien or security interest or any other interest
in
the Stock Collateral or other security for the Obligations. By inspecting the
Stock Collateral or any other properties of the Pledgor or by accepting or
approving anything required to be observed, performed or fulfilled by the
Pledgor or to be given to the Lender pursuant to this Agreement or any of the
other Financing Documents, the Lender shall not be deemed to have warranted
or
represented the condition, sufficiency, legality, effectiveness or legal effect
of the same, and such acceptance or approval shall not constitute any warranty
or representation with respect thereto by the Lender.
[SIGNATURE
APPEARS ON THE FOLLOWING PAGE]
IN
WITNESS WHEREOF, the Pledgor has caused this Pledge, Assignment and Security
Agreement to be executed, sealed and delivered, as of the day and year first
written above.
| WITNESS: | ARGAN, INC. | ||
| /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ |
By:
|
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ (SEAL) | |
|
|
Name:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title:
Chairman and CEO
|
EXHIBIT
A
IRREVOCABLE
STOCK POWER
FOR
VALUE
RECEIVED, the undersigned does (do) hereby sell(s), assign(s) and transfer(s)
to
Name:
Address:
Social
Security or other Identifying Number: ____________________________
________
shares of the ___________ stock of _____________________________________
represented
by Certificate(s) No(s) ________________________inclusive, standing in the
name
of_____________________________________________ on the books of said company.
The undersigned does (do) hereby irrevocably constitute(s) and
appoint(s)___________________________ attorney to transfer the said stock on
the
books of said company with full power of substitution in the
premises.
Dated:_________________ _______________________________________