SUBSCRIPTION AND INVESTMENT AGREEMENT
THIS
SUBSCRIPTION AND INVESTMENT AGREEMENT (this “Agreement”)
is
made as of this 27th
day of
June, 2008, by and among ARGAN, INC., a Delaware corporation (the “Company”)
and
each of the other signatories to this Agreement, as identified on the signature
pages attached hereto (each a “Buyer”,
and
collectively the “Buyers”).
WHEREAS,
the Company is offering up to 2,200,000 shares of the Company’s Common Stock,
$.15 par value (the “Offered
Common Stock”)
to a
limited number of accredited investors in a non-public offering (the
“Offering”);
and
WHEREAS,
the
Company and each Buyer are executing and delivering this Agreement in reliance
upon the exemption from securities registration afforded by Section 4(2) of
the
Securities Act of 1933, as amended (the ÒSecurities
ActÓ),
and
Rule 506 of Regulation D (ÒRegulation
DÓ)
as
promulgated by the United States Securities and Exchange Commission (the
ÒSECÓ)
under
the Securities Act; and
WHEREAS,
each Buyer desires to purchase that number of shares of Offered Common Stock
set
forth on each Buyer’s respective signature page (in each case the “Shares”).
NOW
THEREFORE, in consideration of the foregoing and for valuable consideration,
the
receipt and sufficiency of which is acknowledged, the parties hereto agree
as
follows:
1. Issuance
of Shares
(a) Subject
to the terms and conditions contained herein, the Company will issue to each
Buyer, and each Buyer will purchase from Company, severally and not jointly,
for
the purchase price of $12.00 per share, that number of shares of Offered Common
Stock set forth on each Buyer’s respective signature page. The closing of the
Offering is conditioned upon committed and fully paid subscriptions of not
less
than $21,000,000 in aggregate gross proceeds. The Company will not sell more
than 2,200,000 Shares pursuant to this Offering. The closing date of this
Offering shall be July 1, 2008 (the “Closing
Date”).
Upon
receipt by the Company from Buyers of fully executed versions of this Agreement
representing committed subscriptions of at least $21,000,000 aggregate gross
proceeds the Company will provide notice to the Buyers that the closing of
the
Offering will proceed (the “Closing
Notice”)
and
each Buyer shall send, via wire transfer in immediately available funds, such
Buyer’s full purchase price to the Company on or before 1:00 p.m. EDT on the
Closing Date. The Company’s wire information will be provided to each Buyer with
the Closing Notice.
In
the
event that we do not receive fully paid subscriptions of $21,000,000 or more
on
or before 5:00 p.m. EDT on July 7, 2008, we will refund each Buyer’s respective
purchase price without interest. Upon the closing of the transactions
contemplated hereby, the Company shall deliver to each Buyer a certificate
in
the name of such Buyer for the respective number of Shares issued to such Buyer
(or its respective designee or nominee), containing, inter
alia,
the
legend set forth in Section 2 below.
2. Restrictive
Legends
All
certificates representing Shares shall have affixed thereto legends in
substantially the following form, in addition to any other legends that may
be
required under federal or state securities laws:
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES OR BLUE
SKY LAWS AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE
ASSIGNED EXCEPT PURSUANT TO A REGISTRATION STATEMENT WITH RESPECT TO SUCH
SECURITIES WHICH IS EFFECTIVE UNDER THE ACT OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM REGISTRATION UNDER THE ACT RELATING TO THE DISPOSITION OF
SECURITIES AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES AND BLUE SKY
LAWS.
The
Company acknowledges and agrees that upon such time as the legend is legally
permitted to be removed from the certificates, the Company will take such steps
as required in order to have the legend revised or removed.
3. Investment
Representations
Each
Buyer represents, warrants and covenants as follows:
(a)
The
Buyer
is an “accredited investor” as such term is defined in Rule 501(a) of Regulation
D promulgated pursuant to the Securities Act and is purchasing the applicable
Shares for its own account for investment only, and not with a view to, or
for
sale in connection with, any distribution of such Shares in violation of the
Securities Act or applicable state securities laws, or any rule or regulation
thereunder.
(b)
The
Buyer
has had such opportunity as it has deemed adequate to obtain from
representatives of the Company such information as is necessary to permit it
to
evaluate the merits and risks of its investment in the Company, and has done
so.
(c)
The
Buyer
understands that the Company is required to file periodic reports pursuant
to
the Securities Exchange Act of 1934 (the “1934
Act”),
as
amended. The Buyer acknowledges that they have had such opportunity to obtain
such periodic reports and are familiar with the information contained in such
periodic reports, including without limitation the risk factors contained
therein, and that each periodic report speaks only as of its respective date.
The Buyer understands and acknowledges that no person has been authorized to
give any information or make any representations in connection with the Offering
other than the information contained in such periodic reports and the
representations of the Company contained in Section 4 of this Agreement. The
Buyer understands and acknowledges that, if given or made, other information
or
representations must not be relied on as having been made by or on behalf of
the
Company or ▇▇▇▇▇ & Company LLC (the “Placement
Agent”),
and
the Buyer represents and warrants that the Buyer’s decision to purchase Shares
was not based on any information or representations other than as described
in
the immediately preceding sentence. The Buyer also acknowledges and understands
that all information presented in such periodic reports was prepared by the
Company and that the Placement Agent has not independently verified any such
information and makes no representation as to accuracy or completeness of any
such information or any other related disclosure materials or as to the current
condition or future performance of the Company.
(d)
The
Buyer
has sufficient experience in business, financial and investment matters and,
in
particular, investments in businesses similar to the Company, to be able to
evaluate the risks involved in the purchase of the Shares and to make an
informed investment decision with respect to such purchase.
(e)
The
Buyer
can afford a complete loss of the value of the Shares and is able to bear the
economic risk of holding such Shares for an indefinite period.
(f)
The
Buyer
understands that: (i) the Shares have not been registered under the Securities
Act and are “restricted securities” within the meaning of Rule 144 under the
Securities Act; (ii) the Shares cannot be sold, transferred or otherwise
disposed of unless they are subsequently registered under the Securities Act
or
an exemption from registration is then available; (iii) in any event, the
exemption from registration under Rule 144 will not be available for at least
six months and even then will not be available unless a public market then
exists for the Offered Common Stock, adequate information concerning the Company
is then available to the public, and other terms and conditions of Rule 144
are
complied with; and (iv) there is now no registration statement on file with
the
SEC with respect to any stock of the Buyer and there is no assurance that any
registration statement that may be filed with respect to the resale of the
Shares will be declared effective when expected, or at all, or will remain
effective for a sufficient time to enable the Buyer to sell any or all of its
Shares.
(g)
The
Buyer
has consulted the Buyer’s own accountants, legal counsel and investment tax or
other advisors as the Buyer deemed necessary in connection with the purchase
of
the Shares and has relied solely on the advice of such professionals and not
on
any information or statements from the Company or the Placement
Agent.
(h)
The
Buyer
understands that neither the SEC nor any state securities commission or other
governmental agency has reviewed or passed upon or made any recommendation
or
endorsement of the Shares or any investment therein.
4. Company
Representations
The
Company represents and warrants as follows:
(a) Organization,
Qualification and Corporate Power.
The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware. The Company is duly qualified to
conduct business and is in corporate and tax good standing under the laws of
each jurisdiction in which the nature of its businesses or the ownership or
leasing of its properties requires such qualification, except where the failure
to be so qualified or in good standing would not have a material adverse effect
on the Company’s business. The Company has all requisite corporate power and
authority to carry on the businesses in which it is engaged and to own and
use
the properties owned and used by it.
(b) Authorization
of Transaction.
The
Company has all requisite power and authority to execute and deliver this
Agreement and to perform its obligations hereunder. The execution
and delivery by the Company of this Agreement and the consummation by the
Company of the transactions contemplated hereby have been duly and validly
authorized by all necessary corporate action on the part of the Company.
This Agreement has been duly and validly executed and delivered by the Company
and constitutes a valid and binding obligation of the Company, enforceable
against it in accordance with its terms.
(c) Capital
Stock/Anti-Dilution and Participation Rights.
The
Company’s authorized, issued and outstanding capital stock, warrants and options
are as set forth in the Company’s most recent filings, as of the date of such
filings, made by the Company pursuant to the 1934 Act. There are no pre-emptive
rights, rights of first refusal or other participation rights, nor are there
any
anti-dilution or other adjustments, that would be triggered or subject to
exercise by any person as a result of this Offering.
(d) Noncontravention.
Subject
to compliance with the applicable requirements of the Securities Act, the 1934
Act and any applicable state securities laws, neither the execution and delivery
by the Company of this Agreement, nor the consummation by the Company of the
transactions contemplated hereby will (i) conflict with or violate any
provision of the charter or Bylaws of the Company, (ii) require on the part
of the Company any filing with, or permit, authorization, consent or approval
of, any court, arbitrational tribunal, administrative agency or commission
or
other governmental or regulatory authority or agency (“Governmental
Entity”),
(iii) conflict with, result in breach of, constitute (with or without due
notice or lapse of time or both) a default under, result in the acceleration
of
obligations under, create in any party any right to terminate, modify or cancel,
or require any notice, consent or waiver under, any contract or instrument
to
which the Company is a party or by which it is bound or to which any of its
assets are subject, or (iv) violate any order, writ, injunction, decree,
statute, rule or regulation applicable to the Company or any of its properties
or assets.
(e) SEC
Documents; Financial Statements.
The Company has filed all reports, schedules, forms, statements and other
documents required to be filed by it with the SEC pursuant to the reporting
requirements of the 1934 Act (all of the foregoing filed prior to the date
hereof, and all exhibits included therein and financial statements and schedules
thereto and documents incorporated by reference therein being hereinafter
referred to as the “SEC
Documents”). As
of their respective dates, the SEC Documents complied in all material respects
with the requirements of the 1934 Act and the rules and regulations of the
SEC
promulgated thereunder applicable to the SEC Documents, and none of the SEC
Documents, at the time they were filed with the SEC, contained any untrue
statement of a material fact or omitted to state a material fact required to
be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
As
of
their respective dates, the financial statements of the Company included in
the
SEC Documents complied as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the SEC
with
respect thereto. Such financial statements have been prepared in
accordance with generally accepted accounting principles, consistently applied,
during the periods involved (except (i) as may be otherwise indicated in such
financial statements or the notes thereto, or (ii) in the case of unaudited
interim statements, to the extent they may exclude footnotes or may be condensed
or summary statements) and fairly present in all material respects the financial
position of the Company as of the dates thereof and the results of its
operations and cash flows for the periods then ended (subject, in the case
of
unaudited statements, to normal year-end audit adjustments). The
Company has timely filed all
periodic reports with the SEC and with the American Stock Exchange (the
"AMEX")
and
has complied with all applicable listing requirements necessary to maintain
its
qualification and eligibility on the AMEX. The Company is eligible to use Form
S-3 in transactions involving secondary offerings.
(f) ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act.
The Company is in compliance with any and all applicable requirements of the
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 that are applicable to the Company and effective
as
of the date hereof (as well as any and all applicable rules and regulations
promulgated by the SEC thereunder that are applicable to the Company and
effective as of the date hereof) except where such noncompliance would not
have,
individually or in the aggregate, a material adverse effect.
(g) Litigation.
There is
no action,
suit, proceeding, claim, arbitration or investigation before any Governmental
Entity which is pending or, to the knowledge of the Company, has been threatened
against the Company.
There
are no judgments, orders or decrees outstanding against the Company. To the
knowledge of the Company, there is no threatened civil or criminal litigation,
written notice of violation, formal administrative proceeding, or investigation,
inquiry or information request by any governmental entity with respect to the
business of the Company.
(h) Valid
Issuance.
The
Shares, when sold, issued and delivered in accordance with the terms of this
Agreement, will be duly and validly issued, fully paid and nonassessable, and
will be subject to restrictions on transfer under federal and applicable state
securities law until the Registration Statement (as defined in Section 6(a)
below) is declared effective by the SEC and then may be sold in accordance
with
the terms provided in the prospectus to the Registration Statement as long
as
the Registration Statement remains effective. The Shares will be issued in
compliance in all material respects with an exemption from the registration
requirements of the Securities Act, and the registration and qualification
requirements of the securities laws of the applicable states.
(i) Disclosure.
The Company confirms that neither it nor, to its knowledge, any officer,
director or agent of the Company has provided any of the Buyers or their
respective agents or counsel with any information that constitutes material,
nonpublic information (other than the occurrence of the Offering). The
Company understands and confirms that each of the Buyers will rely on the
foregoing representations in effecting transactions in securities of the
Company. All
disclosure provided to the Buyers regarding the Company, its business and the
transactions contemplated hereby, including the Schedules to this Agreement,
furnished by or on behalf of the Company are true and correct and do not contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading. No
event
or circumstance has occurred or information exists with respect to the Company
or its business, properties, prospects, operations or financial conditions,
which, under applicable law, rule or regulation, requires public disclosure
or
announcement by the Company on or before the date hereof but which has not
been
so publicly announced or disclosed (assuming for this purpose that the Company’s
reports filed under the 1934 Act, as amended, are being incorporated into an
effective registration statement filed by the Company under the Securities
Act).
(j) Form
D
and Blue Sky.
The Company has conducted the Offering as a private placement in accordance
with
Regulation D and agrees to file a Form D with respect to the Securities as
required under Regulation D and to provide a copy thereof to each Buyer promptly
after such filing. The Company shall, on or before the Closing Date, take
such action as the Company shall reasonably determine is necessary in order
to
obtain an exemption for or to qualify the Securities for sale to the Buyers
at
the Closing pursuant to this Agreement under applicable securities or ÒBlue SkyÓ
laws of the states of the United States (or to obtain an exemption from such
qualification), and shall provide evidence of any such action so taken to the
Buyers on or prior to the Closing Date. The Company shall make all filings
and reports relating to the offer and sale of the Securities required under
applicable securities or ÒBlue SkyÓ laws of the states of the United States
following the Closing Date.
(k) Same
Terms.
All
Buyers are participating in the Offering on the same terms and conditions.
There
exist no alternate, individualized or exclusive agreements or arrangements
with
any Buyer in connection with the Offering.
5. Use
of
Proceeds.
The
Company expects to use a portion of the proceeds in connection with a planned
joint venture with Invenergy Wind LLC to perform engineering, procurement and
construction services for wind energy generating facilities, with the remaining
proceeds to be used by the Company for general corporate purposes.
6. Registration
Rights Provisions.
(a) The
Company agrees that it will use its best efforts to, within 30 days following
the closing of the Offering, prepare and file with the SEC a registration
statement on Form S-3, or any equivalent form for registration by issuers
similar to the Company in accordance with the Securities Act (“Registration
Statement”),
to
permit a public offering and resale of the Shares on a continuous basis under
Rule 415. The Company agrees that it will use commercially reasonable efforts
to
cause the Registration Statement to be declared effective by the SEC as soon
as
practicable following the filing thereof. The Company will cause the
Registration Statement to remain effective until such time as all of the Shares
are sold or all holders thereof are entitled to rely on Rule 144(b) for sales
of
the Shares without registration under the Securities Act and without compliance
with the public information, sales volume, manner of sale or notice requirements
of Rule 144. The Company will pay all registration expenses of the registration
of the Shares pursuant to this Section 6(a). Other than ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
and
his affiliates, who collectively hold 200,000 shares of the Company’s Common
Stock (collectively, the “▇▇▇▇▇▇▇▇
Shares”),
no
person has or will have “piggy-back” or other participation rights with respect
to the Registration Statement, nor will the Company file any other registration
statement prior to the effectiveness of the Registration Statement. It is,
however, acknowledged and agreed by Buyers, that the Company may include both
the Shares and the ▇▇▇▇▇▇▇▇ Shares in the Registration
Statement.
(b) In
the
event of the offer and sale of Shares held by Buyers pursuant to the
Registration Statement under the Securities Act, the Company must, and hereby
does, indemnify and hold harmless, to the fullest extent permitted by law,
each
Buyer, its directors, officers, partners, consultants, each other person who
participates as an underwriter in the offering or sale of such securities,
and
each other person, if any, who controls or is under common control with such
Buyer or any such underwriter within the meaning of Section 15 of the Securities
Act, against any losses, claims, damages or liabilities, joint or several,
and
expenses to which the Buyer or any such director, officer, partner, consultant
or underwriter or controlling person may become subject under the Securities
Act
or otherwise, insofar as such losses, claims, damages, liabilities or expenses
(or actions or proceedings, whether commenced or threatened, in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in any Registration Statement under which such
Shares were registered under the Securities Act, any preliminary prospectus,
final prospectus or summary prospectus contained therein, or any amendment
or
supplement thereto, or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein in the light of the circumstances under which they were made not
misleading, and the Company must reimburse the Buyer, and each such director,
officer, partner, underwriter and controlling person for any legal or any other
expenses reasonably incurred by them in connection with investigating, defending
or settling any such loss, claim, damage, liability, action or proceeding;
provided
that the
Company is not liable in any such case (i) to the extent that any such loss,
claim, damage, liability (or action or proceeding in respect thereof) or expense
arises out of or is based upon an untrue statement or omission from such
Registration Statement, any such preliminary prospectus, final prospectus,
summary prospectus, amendment or supplement made in reliance upon and in
conformity with written information furnished to the Company by or on behalf
of
such Buyer or (ii) if the person asserting any such loss, claim, damage,
liability (or action or proceeding in respect thereof) who purchased the Shares
that are the subject thereof did not receive a copy of an amended preliminary
prospectus or the final prospectus (or the final prospectus as amended or
supplemented) at or prior to the written confirmation of the sale of such Shares
to such person because of the failure of such Buyer or any underwriter to so
provide such amended preliminary or final prospectus and the untrue statement
or
alleged untrue statement or omission or alleged omission of a material fact
made
in such preliminary prospectus was corrected in the amended preliminary or
final
prospectus (or the final prospectus as amended or supplemented). Such indemnity
remains in full force and effect regardless of any investigation made by or
on
behalf of the Buyers, or any such director, officer, partner, underwriter or
controlling person and survives the transfer of such shares by the
Buyer.
(c) As
a
condition to including Shares in a registration statement, each such Buyer
agrees to be bound by the terms of this Section 6 and to indemnify and hold
harmless, to the fullest extent permitted by law, the Company, its directors
and
officers, its consultants, underwriters and each other person, if any, who
controls the Company within the meaning of Section 15 of the Securities Act,
against any losses, claims, damages or liabilities, joint or several, to which
the Company or any such director, officer, consultant or underwriter or
controlling person may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out
of
or are based upon any untrue statement or alleged untrue statement in or
omission or alleged omission from such Registration Statement, any preliminary
prospectus, final prospectus or summary prospectus contained therein, or any
amendment or supplement thereto, if such statement or alleged statement or
omission or alleged omission was made in reliance upon and in conformity with
written information furnished to the Company by such Buyer, and such Buyer
must
reimburse the Company, and each such director, officer, and controlling person
for any legal or other expenses reasonably incurred by them in connection with
investigating, defending, or settling any such loss, claim, damage, liability,
action, or proceeding; provided,
however,
that
the liability of such Buyer hereunder shall be limited to the net proceeds
received by such Buyer from the sale of Shares covered by such Registration
Statement. Such
indemnity remains in full force and effect regardless of any investigation
made
by or on behalf of the Company or any such director, officer or controlling
person and shall survive the transfer by any Buyer of such
Shares.
(d) Promptly
after receipt by an indemnified party of notice of the commencement of any
action or proceeding involving a claim referred to in Sections 6(b) or (c)
hereof (including any governmental action), such indemnified party must, if
a
claim in respect thereof is to be made against an indemnifying party, give
written notice to the indemnifying party of the commencement of such action;
provided that the failure of any indemnified party to give notice as provided
herein does not relieve the indemnifying party of its obligations under Section
6(b) or (c) hereof, except to the extent that the indemnifying party is actually
prejudiced by such failure to give notice. In case any such action is brought
against an indemnified party, unless in the reasonable judgment of counsel
to
such indemnified party a conflict of interest between such indemnified and
indemnifying parties may exist or the indemnified party may have defenses not
available to the indemnifying party in respect of such claim, the indemnifying
party is entitled to participate in and to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party and, after notice
from
the indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party shall not be liable to such
indemnified party for any legal or other expenses subsequently incurred by
the
latter in connection with the defense thereof, unless in such indemnified
party’s reasonable judgment a conflict of interest between such indemnified and
indemnifying parties arises in respect of such claim after the assumption of
the
defense thereof or the indemnifying party fails to defend such claim in a
diligent manner. Neither an indemnified nor an indemnifying party is liable
for
any settlement of any action or proceeding effected without its consent, which
shall not be unreasonably withheld or delayed. No indemnifying party may,
without the consent of the indemnified party, consent to entry of any judgment
or enter into any settlement, which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such indemnified party of
a
release from all liability in respect of such claim or litigation.
Notwithstanding anything to the contrary set forth herein, and without limiting
any of the rights set forth above, in any event any party has the right to
retain, at its own expense, counsel with respect to the defense of a
claim.
(e) In
the
event that an indemnifying party does or is not permitted to assume the defense
of an action pursuant to Section 6(d) or in the case of the expense
reimbursement obligation set forth in Sections 6(b) and (c), the indemnification
required by Sections 6(b) and (c) hereof must be made by periodic payments
of
the amount thereof during the course of the investigation or defense, as, and
when bills received or expenses, losses, damages, or liabilities are
incurred.
(f) If
the
indemnification provided for in this Section 6 is held by a court of competent
jurisdiction to be unavailable to an indemnified party with respect to any
loss,
liability, claim, damage or expense referred to herein, the indemnifying party,
in lieu of indemnifying such indemnified party hereunder, must (i) contribute
to
the amount paid or payable by such indemnified party as a result of such loss,
liability, claim, damage or expense as is appropriate to reflect the
proportionate relative fault of the indemnifying party on the one hand and
the
indemnified party on the other (determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or omission
relates to information supplied by the indemnifying party or the indemnified
party and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission), or (ii)
if
the allocation provided by clause (i) above is not permitted by applicable
law
or provides a lesser sum to the indemnified party than the amount hereinafter
calculated, not only the proportionate relative fault of the indemnifying party
and the indemnified party, but also the relative benefits received by the
indemnifying party on the one hand and the indemnified party on the other,
as
well as any other relevant equitable considerations. No indemnified party guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) is entitled to contribution from any indemnifying party who
was
not guilty of such fraudulent misrepresentation. Notwithstanding the foregoing,
the contribution liability of a Buyer hereunder shall be limited to the net
proceeds received by such Buyer from the sale of Shares covered by such
Registration Statement.
(g) The
Company shall furnish to each Buyer whose Shares are included in any
registration statement, without charge, (i) promptly after the same is
prepared and filed with the SEC, at least one copy of such registration
statement and any amendment(s) thereto, including financial statements and
schedules, all documents, including exhibits, incorporated therein by reference,
if requested by an Investor and not otherwise available on the ▇▇▇▇▇ system,
all
other exhibits if reasonably requested by the Investor and each preliminary
prospectus, (ii) upon the effectiveness of any registration statement, a copy
of
the prospectus included in such registration statement and all amendments and
supplements thereto (or such other number of copies as such Buyer may reasonably
request) and (iii) such other documents, including copies of any preliminary
or
final prospectus, as such Buyer may reasonably request from time to time in
order to facilitate the disposition of the Shares owned by such
Buyer.
(h) The
Company will prepare and file with the SEC such amendments and supplements
to
the Registration Statement and take such other action, if any, as may be
necessary to keep the Registration Statement effective until the earlier of
(i) the date on which the Shares may be resold by the Buyers without
registration and without regard to any volume limitations by reason of
Rule 144 under the Securities Act or any other rule of similar effect,
or (ii) all of the Shares have been sold pursuant to the Registration
Statement or Rule 144 under the Securities Act or any other rule of
similar effect.
7. Broker
Fee
It
is
acknowledged and agreed by Buyers that a broker fee, equal to 5% of the
aggregate purchase price of all of the Shares sold in this Offering (the
“Broker
Fee”)
shall
be payable by the Company to the Placement Agent. The Broker Fee shall be
payable in full to the Placement Agent upon the closing of the Offering and
the
Company will reimburse the Placement Agent for its expenses in connection with
the Offering.
8. Miscellaneous
(a)
Severability.
The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement,
and each other provision of this Agreement shall be severable and enforceable
to
the extent permitted by law.
(b)
Waiver.
Any
provision for the benefit of the Company contained in this Agreement may be
waived, either generally or in any particular instance, by the Board of
Directors of the Company, as evidenced by a signed certificate of the Secretary
of the Company certifying as to such action by the Board.
(c)
Binding
Effect.
This
Agreement shall be binding upon and inure to the benefit of the Company and
each
Buyer and their respective heirs, executors, administrators, legal
representatives, successors and assigns.
(d)
Notice.
All
notices required or permitted hereunder shall be in writing and deemed
effectively given upon personal delivery or five days after deposit in the
United States Post Office, by registered or certified mail, postage prepaid,
addressed to the other party hereto at the address shown beneath his or its
respective signature to this Agreement, or at such other address or addresses
as
either party shall designate to the other in accordance with this Section
8(d).
(e)
Pronouns.
Whenever the context may require, any pronouns used in this Agreement shall
include the corresponding masculine, feminine or neuter forms, and the singular
form of nouns and pronouns shall include the plural, and vice
versa.
(f)
Entire
Agreement.
This
Agreement constitutes the entire agreement between the parties with respect
to
the Shares, and supersedes all prior agreements and understandings, relating
to
the subject matter of this Agreement.
(g)
Amendment.
This
Agreement may be amended or modified only by a written instrument executed
by
the Company and by those Buyers who, in the aggregate, hold not less that 75%
of
the Shares sold in connection with this Offering.
(h) Disclosure
of Transactions and Other Material Information.
On or before the fourth business day following the date hereof, the Company
shall file a Current Report on Form 8-K describing the terms of the Offering
in
the form required by the 1934 Act, and attaching the required documents as
exhibits to such filing (including all attachments, the Ò8-K
FilingÓ).
(i)
Governing
Law.
This
Agreement and the rights and obligations of the parties hereunder shall be
enforced, governed and construed in all respects in accordance with the internal
substantive laws of the State of Delaware (without reference to principles
of
conflicts or choice of law that would cause the application of the internal
laws
of any other jurisdiction). Each Party hereby irrevocably submits and consents
to the jurisdiction of Delaware with respect to any dispute, controversy, legal
action or other proceeding that arises from, concerns or touches this Agreement
or the purchase of the Shares and acknowledges that he, she or it will accept
service of process by registered or certified mail or the equivalent directed
to
his, her or its address set forth herein or by whatever other means are
permitted by such courts. Each party hereby acknowledges that said courts have
jurisdiction over any such dispute, controversy, legal action or other
proceeding and that he, she or its hereby waives any objection to personal
jurisdiction or venue in these courts or that such courts are an inconvenient
forum.
(j)
Counterparts.
This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed an original and constitute the same instrument.
[the
following pages are the signature pages]
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date
first written above.
THE
COMPANY:
ARGAN,
INC.
____________________________________
By:
Its:
|
ENTITY
BUYERS:
Name
of Buyer
BY:
Name:
Title:
EIN:
Number
of Shares:
|
|
INDIVIDUAL
BUYERS:
Name:
Title:
Address:
SSN:
Number
of Shares:
|