FIRST AMENDMENT TO TERM NOTE
THIS FIRST AMENDMENT TO TERM NOTE (this "Agreement") is made as of June
29, 2004, by Argan, Inc. (formerly PUROFLOW INCORPORATED), a corporation
organized under the laws of the State of Delaware and SOUTHERN MARYLAND CABLE,
INC., a corporation organized under the laws of the State of Delaware,
(collectively, the "Borrowers" and each a "Borrower"), jointly and severally and
BANK OF AMERICA, N.A., a national banking association, it successors and assigns
(the "Lender").
RECITALS
A. The Borrowers and the Lender entered into a Financing and Security
Agreement dated August 19, 2003 (the same, as amended, modified, restated,
substituted, extended, and renewed from time to time, the "Financing
Agreement"). Under the terms of the Financing Agreement, the Lender agreed to
make the Term Loan (as that term is defined in the Financing Agreement) which is
evidenced by the Borrowers' Term Note dated August 19, 2003 (the same, as
amended by this Agreement and as amended, modified, restated, substituted,
extended and renewed at any time and from time to time, the "Note").
B. The Borrowers have requested that the Lender waive certain covenant
defaults and otherwise modify the Note, pursuant to the terms of this Agreement.
C. The Lender is willing to agree to the Borrowers' request on the
condition, among others, that this Agreement be executed.
AGREEMENTS
NOW, THEREFORE, in consideration of the premises, the mutual agreements
herein contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Borrowers and the Lender
hereby agree as follows:
1. 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. Section 1 of the Term Note is hereby amended and restated in its
entirety as follows:
1. Interest Commencing as of July 1, 2004 and continuing thereafter
until repayment in full, the unpaid Principal Sum shall bear interest at the
LIBOR Rate plus three hundred forty five (345) basis points per annum.
The rate of interest charged under this Note shall change
immediately and contemporaneously with any change in the LIBOR Rate. All
interest payable under the terms of this Note shall be calculated on the basis
of a 360-day year and the actual number of days elapsed.
3. The Borrowers and the Lender agree that this Agreement is not intended
to and shall not cause a novation with respect to the Term Loan and/or any or
all of the other Obligations evidenced or secured by the Financing Documents (as
defined in the Financing Agreement). Except as expressly modified herein, the
terms, provisions and covenants of the Note are in all other respects hereby
ratified and confirmed and remain in full force and effect.
4. 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. The Borrowers agree that the Lender may rely on a telecopy of any
signature of any Borrower. The Lender agrees that the Borrowers may rely on a
telecopy of this Agreement executed by the Lender.
[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the parties hereto have signed and sealed this
Agreement on the day and year first above written.
WITNESS: ARGAN, INC.
_________________________ By:__________________________(SEAL)
Name:
Title:
WITNESS OR ATTEST: SOUTHERN MARYLAND CABLE, INC.
________________________ By:____________________________(Seal)
Name:
Title:
WITNESS: BANK OF AMERICA, N.A.
________________________ By:____________________________(Seal)
Name:
Title:
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