ARGAN INC
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>4
<FILENAME>v06469_ex10-2.txt
<TEXT>

                              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,

<PAGE>

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.


                                       2
<PAGE>

      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


                                       3
<PAGE>

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


                                       4
<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).


                                       5
<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


                                       6
<PAGE>

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).


                                       7
<PAGE>

            (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.


                                       8
<PAGE>

      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


                                       15


</TEXT>
</DOCUMENT>
