As Filed with the Securities and Exchange Commission on July 16, 2008.

REGISTRATION NO. 333-________

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 


FORM S-3

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

ARGAN, INC. 

(Exact Name of Registrant as Specified in Its Charter)

Delaware

(State or Other Jurisdiction of Incorporation or Organization)

13-1947195

(I.R.S. Employer Identification Number)
 
One Church Street, Suite 401
Rockville, MD 20850
(301) 315-0027

(Address, Including Zip Code, and Telephone Number, Including Area Code,
of Registrant’s Principal Executive Offices)

Rainer H. Bosselmann
Chief Executive Officer
Argan, Inc.
One Church Street, Suite 401
Rockville, MD 20850
(301) 315-0027

(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service)

Copies of All Communications to:

Richard A. Krantz, Esq.
Robinson & Cole LLP
Financial Centre
695 East Main Street
Stamford, Connecticut  06904
(203) 462-7500

Approximate Date of Commencement of Proposed Sale to the Public: From time to time after the effective date of this registration statement.
 
If the only securities being registered on this form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. ¨
 
If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 (the “Securities Act”), other than securities offered in connection with dividend or interest reinvestment plans, check the following box. x.
 
If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨
 
If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨ 

If this form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. ¨ 

If this form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. ¨ 



CALCULATION OF REGISTRATION FEE

Title of Each Class of
Securities
to Be Registered
 
Amount
To Be
Registered 
 
Proposed
Maximum
Offering
Price Per
Share 
 
Proposed
Maximum
Aggregate
Offering
Price
 
Amount of
Registration
Fee
 
                   
Common Stock
   
2,400,000
(1)
$
14.40
(2)
$
34,560,000
(2)
$
1,358.00
 
 
(1) Pursuant to Rule 416 of the Securities Act of 1933, as amended, this registration statement shall also cover any additional shares of common stock by reason of any stock dividend, stock split, recapitalization or similar transaction or to cover such additional shares as may hereinafter be offered or issued to prevent dilution resulting from stock splits, stock dividends, recapitalizations or certain other capital adjustments, effected without the registrant’s receipt of consideration, which results in an increase in the number of outstanding shares of the registrant’s common stock.
 
(2) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) under the Securities Act of 1933, as amended, based upon the average of the high and low prices of the registrant’s common stock as reported by the American Stock Exchange on July 9, 2008.
 
  The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.



THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED.  THESE SECURITIES MAY NOT BE SOLD UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE.  THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

SUBJECT TO COMPLETION, DATED JULY __, 2008

PROSPECTUS
[ARGAN, INC.
LOGO]

2,400,000 Shares of Common Stock

On July 2, 2008, the selling shareholders listed on pages 19 to 37 hereof acquired 2,200,000 shares of our common stock directly from us in a private placement that was exempt from the registration requirements of the federal securities laws. An additional 200,000 shares of the Company’s common stock is being registered hereunder for a separate selling stockholder who acquired these shares from us in connection with an earlier private placement on December 8, 2006. Under this prospectus, the selling shareholders and any pledgees, donees, transferees or other successors-in-interest may offer and resell up to 2,400,000 shares of our common stock for their own accounts. We will not receive any of the proceeds from the sale of these shares by the selling shareholders.

The selling shareholders may sell their shares from time to time at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices. We have agreed to bear all of the expenses in connection with the registration and sale of the shares, except for underwriting discounts and selling commissions.

Our common stock is listed on the American Stock Exchange under the symbol AGX.
 
Our principal executive offices are located at One Church Street, Suite 401, Rockville, MD 20850, and our telephone number is (301) 315-0027.
 
Investing in our common stock involves risks. See “Risk Factors” beginning on page 4.
 
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

The date of this prospectus is July 16, 2008.


 

 
TABLE OF CONTENTS

   
Page
     
FORWARD-LOOKING STATEMENTS
 
ii
     
ABOUT THIS PROSPECTUS
 
ii
     
SUMMARY
 
1
     
RISK FACTORS
 
4
     
USE OF PROCEEDS
 
18
     
SELLING SHAREHOLDERS
 
18
     
PLAN OF DISTRIBUTION
 
37
     
LEGAL MATTERS
 
40
     
EXPERTS
 
40
     
WHERE YOU CAN FIND MORE INFORMATION
 
40
     
INCORPORATION BY REFERENCE
 
41
 
i



 
FORWARD-LOOKING STATEMENTS
 
This prospectus and the documents incorporated by reference into this prospectus contain forward-looking statements that are based on current expectations, estimates and projections about our industry, management’s beliefs, and assumptions made by management. Words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” and variations of such words and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict; therefore, actual results may differ materially from those expressed or forecasted in any forward- looking statements. The risks and uncertainties include those noted in the “Risk Factors” section below and in the documents incorporated by reference. We undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

ABOUT THIS PROSPECTUS
 
This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission (the “SEC”) utilizing a continuous offering process. Under this continuous offering process, the selling shareholders may, from time to time, sell the securities described in this prospectus in one or more offerings. This prospectus provides you with a general description of the securities that may be offered by the selling shareholders. Each time a selling shareholder sells securities, the selling shareholder is required to provide you with this prospectus and, in certain cases, a prospectus supplement containing more specific information about the selling shareholder and the terms of the securities being offered. The prospectus supplement may also add, update or change information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in that prospectus supplement. You should carefully read both this prospectus and any prospectus supplement, including documents incorporated by reference herein, together with the additional information described in the section entitled “Where You Can Find More Information.”
 
We have not authorized any dealer, salesperson or other person to give any information or to make any representation other than those contained or incorporated by reference in this prospectus and any accompanying supplement to this prospectus. You must not rely upon any information or representation not contained or incorporated by reference in this prospectus or any accompanying prospectus supplement. Neither this prospectus nor any accompanying supplement to this prospectus constitutes or will constitute an offer to sell or the solicitation of an offer to buy any securities other than the registered securities to which they relate, nor do this prospectus and any accompanying supplement to this prospectus constitute an offer to sell or the solicitation of an offer to buy securities in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation in such jurisdiction. You should not assume that the information contained in this prospectus and any accompanying prospectus supplement is accurate on any date subsequent to the date set forth on the front of the document or that any information we have incorporated by reference is correct on any date subsequent to the date of the document incorporated by reference, even though this prospectus and any accompanying prospectus supplement is delivered or securities sold on a later date.

ii



 
SUMMARY

This summary highlights information contained elsewhere in this prospectus and in the documents incorporated by reference herein and does not contain all of the information you should consider in making your investment decision. You should read this summary together with the more detailed information, including our business information, financial statements and the related notes, incorporated by reference in this prospectus, as well as the information set forth in any prospectus supplement. You should carefully consider, among other things, the matters discussed in the section entitled “Risk Factors.”

Argan, Inc.

We provide a broad range of engineering, procurement and construction services to the power industry and telecommunications infrastructure services to utilities, government agencies and other commercial customers, as well as engage in the manufacture and distribution of nutritional supplement products. We conduct our operations through our wholly owned subsidiaries, Gemma Power Systems, LLC and its affiliates (“GPS”), Vitarich Laboratories, Inc. (“VLI”) and Southern Maryland Cable, Inc. (“SMC”) that we acquired in December 2006, August 2004, and July 2003 respectively.
 
In June 2008, GPS entered into a business partnership with lnvenergy Wind Management LLC for the design and construction of wind energy farms located in the mid-western region of the United States into Canada. The partners will each own 50% of the new company, Gemma Renewable Power, LLC (“GRP”). We expect that GRP will annually provide engineering, procurement and construction services for new wind energy farms generating more than an estimated 300 megawatts of electrical power including the design and construction of roads, foundations and electrical collection systems well as the erection of towers, turbines and blades. The new venture shall also assist with some of the ongoing servicing of the wind farm equipment.

Power Industry Services

Through GPS, we provide a full range of development, consulting, engineering, procurement, construction, commissioning, operating and maintenance services to the energy market for a wide range of customers including public utilities, independent power project owners, municipalities, public institutions and private industry.

We plan to participate in the rapidly growing alternative fuel industry, including biodiesel, ethanol and other power energy systems. We provide engineering, procurement and construction services to the owners of alternative power energy systems.

We intend to emphasize our expertise in the alternative fuel industry as well as our proven track record developing facilities and services for traditional power energy systems. We believe that we are uniquely positioned to assist in the development and delivery of innovative renewable energy solutions as world energy needs grow and efforts to combat global warming increase.

Telecommunications Infrastructure Services

Through SMC, we provide telecommunications infrastructure services. We currently provide inside plant, premise wiring services to the Federal Government and have plans to expand that work to commercial customers who regularly need upgrades in their premise wiring systems to accommodate improvements in security, telecommunications and network capabilities.



We continue to participate in the expansion of the telecommunications industry by working with various telecommunications providers. We are actively pursuing contracts with a vide variety of telecommunications providers. We provide maintenance and upgrade services for their outside plant systems that increase the capacity of existing infrastructure. We also provide outside plant services to the power industry by providing maintenance and upgrade services to utilities.
 
We intend to emphasize our high quality reputation, outstanding customer base and highly motivated work force in competing for larger and more diverse contracts. We believe that our high quality and well maintained fleet of vehicles and construction machinery and equipment is essential to meet customers’ needs for high quality and on-time service. We are committed to invest in our repair and maintenance capabilities to maintain the quality and life of our equipment. Additionally, we invest annually in new vehicles and equipment.
 
Nutritional Products

Through VLI, we are dedicated to providing research, development, manufacture and distribution of premium nutritional supplements, whole-food dietary supplements and personal care products. Several of these products have garnered honors including the National Nutritional Foods Association’s prestigious People’s Choice Awards for best products of the year in its respective category. Our customers include health food store chains, mass merchandisers, network marketing companies, pharmacies and major retailers.

We intend to enhance our position in the fast growing global nutrition industry through our innovative product development and research. We believe that we will be able to expand our distribution channels by providing continuous quality assurance and by focusing on timely delivery of superior nutritional products.

Holding Company Structure

We intend to make additional acquisitions and/or investments. We intend to have more than one industrial focus and to identify those companies that are in industries with significant potential to grow profitably both internally and through acquisitions. We expect that companies acquired in each of these industrial groups will be held in separate subsidiaries that will be operated in a manner that best provides cash flow and value for Argan, Inc.

We are a holding company with no operations other than our investments in VLI, SMC and GPS. At July 2, 2008, there were no restrictions with respect to payments from VLI, SMC and GPS to Argan, Inc.

Our principal executive offices are located at One Church Street, Suite 401, Rockville, Maryland 20850. Our phone number at that address is (301) 315-0027. We maintain a website on the Internet at www.arganinc.com. Information on our website is not incorporated by reference into this prospectus.

Unless the context otherwise requires, references in this prospectus to “Argan,”, “we,” “us” or “our” refer to Argan, Inc., a Delaware corporation, and its subsidiaries. Our fiscal year for financial reporting ends on January 31.

2


The Offering

 
2,400,000 shares.(1)
     
Common Stock Outstanding
 
13,325,026 shares.(2)
     
Risk Factors
 
Investment in our securities involves a high degree of risk. You should carefully consider the risk factors described under the section entitled “Risk Factors”, as well as any other information in this prospectus, any prospectus supplement and any document incorporated herein by reference before investing in any of our securities. Each of these risk factors could adversely affect our business, operating results and financial condition, as well as adversely affect the value of an investment in our securities.
     
Use of Proceeds
 
The proceeds from the sale of the shares of our common stock being offered by the selling shareholders pursuant to this prospectus and any prospectus supplement, if applicable, net of any broker’s fee or commissions, will belong to the selling shareholders. We will not receive any of the proceeds from the sale of these shares. See section entitled “Use of Proceeds”.
     
Plan of Distribution
 
The shares may be offered and sold from time to time by selling shareholders, and any pledgees, donees, transferees or other successors-in-interest of the shares, through public or private transactions at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices. See section entitled “Plan of Distribution”.

(1)  Includes 2,200,000 shares of the Company’s common stock acquired by investors in our July 2008 private placement and 200,000 shares of the Company’s common stock beneficially owned by MSR Fund II, L.P. and its affiliates (“MSR”), such shares being acquired by MSR in connection with our December 2006 private placement.

(2)  The above outstanding share information is based upon shares of our common stock outstanding as of July 2, 2008. This number includes the 2,200,000 shares of our common stock sold in connection with the July 2008 private placement. The above outstanding share information excludes: (i) 536,425 shares of our common stock issuable upon the exercise of options outstanding at July 2, 2008; (ii) 218,000 shares of our common stock issuable upon the exercise of warrants outstanding at July 2, 2008; and (iii) an aggregate of 586,350 shares of our common stock available for future awards under our 2001 Stock Option Plan.

3


RISK FACTORS
 
Investing in our securities involves a high degree of risk. Our business, financial position and future results of operations may be impacted in a materially adverse manner by risks associated with the execution of our strategic plan and the creation of a profitable and cash-flow positive business, our ability to obtain capital or to obtain capital on terms acceptable to us, the successful integration of acquired companies into our consolidated operations, our ability to successfully manage diverse operations remotely located, our ability to successfully compete in highly competitive industries, the successful resolution of ongoing litigation, our dependence upon key managers and employees and our ability to retain them, and potential fluctuations in quarterly operating results, among other risks. Before investing in our securities, please consider the risks summarized in this paragraph and those risks discussed below. Our future results may also be impacted by other risk-factors listed from time to time in our future filings with the SEC, including, but not limited to, our Annual Reports on Form 10-K and our Quarterly Reports on Form 10-Q.
 
General Risks Relating to Our Company
 
Further economic downturn may lead to less demand for our products and services.
 
If the general level of economic activity continues to slow, our customers may delay or cancel new projects or products. For example, economic downturns in the past have led to increased bankruptcies, a scarcity of available growth capital and pricing pressures. These factors contribute to the delay and cancellation of projects and the introduction of new products, and could impact our operations and ability to continue to grow at expected levels. A number of other factors, including financing conditions for the industries we serve, could adversely affect our customers and their ability or willingness to fund capital expenditures in the future, establish new supply relationships or pay for past services. In addition, consolidation, competition or capital constraints in the industries of our customers may result in reduced spending by such customers. If general economic conditions do not improve, the demand for our products and services may be adversely affected.
 
We have incurred losses in the past; we may experience additional losses in the future.
 
The Company has historically incurred losses. The Company’s accumulated deficit at April 30, 2008 was approximately $16.8 million resulting primarily from operating losses in prior years. Although we reported consolidated net income of approximately $1.6 million for our first quarter ended April 30, 2008, we incurred a net loss of approximately $3.2 million for the fiscal year ended January 31, 2008. Future losses may occur in one or more segments of our business. If net losses were to recur, we could experience cash flow and liquidity shortfalls having adverse affects on our ability to successfully execute our business plan.
 
We may be unsuccessful at generating internal growth which could result in an overall decline in our business.
 
Our ability to expand by achieving overall organic growth of the Company will be affected by, among other factors, our success in:
 
 
·
expanding the range of services and products we offer to customers to address their evolving needs;
 
·
attracting new customers;
 
·
hiring and retaining employees; and
 
·
reducing operating and overhead expenses.

Many of the factors affecting our ability to generate internal growth may be beyond our control. Our strategies may not be successful and we may not be able to generate cash flow sufficient to fund our operations and to support internal growth. Our inability to achieve internal growth could materially and adversely affect our business, financial condition and results of operations.

4


Future acquisitions and/or investments may not occur which could limit the growth of our business.
 
We are a holding company with no operations other than our investments in SMC, VLI and GPS. The successful execution of our overall business plan could be based, in part, on our making additional acquisitions and/or investments that would provide positive cash flow to us and value to our stockholders. Additional companies that meet these criteria, which provide products and/or services to growth industries, and that are available for purchase at attractive prices may be difficult to find. Accordingly, there can be no assurance that future acquisitions will occur, or if they occur, will be beneficial to us and our stockholders.
 
Our results of operations could be adversely affected as a result of impairment adjustments to goodwill and other purchased intangible assets.
 
When we acquire a business, we have recorded an asset called “goodwill” equal to the excess amount paid for the business, including liabilities assumed, over the fair value of the tangible and intangible assets of the business acquired. In 2001, the Financial Accounting Standards Board (“FASB”) issued Statement No. 141, “Business Combinations” which requires that all business combinations be accounted for using the purchase method of accounting and that certain intangible assets acquired in a business combination be recognized as assets apart from goodwill. FASB Statement No. 142, “Goodwill and Other Intangible Assets” (“Statement 142”) provides that goodwill and other intangible assets that have finite useful lives not be amortized, but instead must be tested at least annually for impairment, and intangible assets that have finite useful lives should continue to be amortized over their useful lives. Statement 142 also provides specific guidance for testing goodwill and other non-amortized intangible assets for impairment. Statement 142 requires management to make certain estimates and assumptions to allocate goodwill to reporting units and to determine the fair value of reporting unit net assets and liabilities, including, among other things, an assessment of market conditions, projected cash flows, investment rates and cost of capital and growth rates, which could significantly impact the reported value of goodwill and other intangible assets. Fair value is determined using discounted estimated future cash flow. Absent any impairment indicators, we perform impairment tests annually each November 1. The aggregate amount of goodwill and other purchased intangible assets with indefinite lives carried in our consolidated balance sheet as of April 30, 2008 was approximately $20.6 million, or approximately 14% of total assets.
 
The declining financial performance of VLI caused us to record impairment losses last year related to goodwill and other purchased intangible assets of VLI in the total amount of $6.8 million that are reflected in the reported net loss in the consolidated statement of operations for the year ended January 31, 2008. Should the operating results of VLI continue to deteriorate, or should the operating results of any of our other acquired companies experience unexpected deterioration, we could be required to record additional impairment losses related to purchased intangible assets. Impairment adjustments, if any, would be recognized as operating expenses and would adversely affect profitability.
 
The integration of acquired companies may not be successful.
 
Even if we do complete acquisitions in the future, we may not be able to successfully integrate such acquired companies with our other operations without substantial costs, delays or other operational or financial problems. Integrating acquired companies involves a number of special risks which could materially and adversely affect our business, financial condition and results of operations, including:
 
 
·
failure of acquired companies to achieve the results we expect;
 
·
diversion of management’s attention from operational matters;
 
·
difficulties integrating the operations and personnel of acquired companies;
 
·
inability to retain key personnel of acquired companies;
 
·
risks associated with unanticipated events or liabilities;

5


 
·
the potential disruption of our business; and
 
·
the difficulty of maintaining uniform standards, controls, procedures and policies.

If one of our acquired companies suffers customer dissatisfaction or performance problems, the reputation of our entire company could be materially and adversely affected. In addition, future acquisitions could result in issuances of equity securities that would reduce our stockholders’ ownership interest, the incurrence of debt, contingent liabilities, deferred stock-based compensation or expenses related to the valuation of goodwill or other intangible assets and the incurrence of large, immediate write-offs.
 
We may not be able to raise additional capital and, as a result, may not be able to successfully execute our business plan.
 
It is likely that we will need to raise additional capital to finance future business acquisitions and/or investments. Additional financing may not be available on terms that are acceptable to us or at all. If we raise additional funds through the issuance of equity or convertible debt securities, the percentage ownership of our stockholders would be reduced. Additionally, these securities might have rights, preferences and privileges senior to those of our current stockholders. If adequate funds are not available on terms acceptable to us, our ability to finance future business acquisitions and/or investments and to otherwise pursue our business plan would be significantly limited.
 
We cannot readily predict the timing, size and success of our acquisition efforts and therefore the capital we will need for these efforts. Using cash for acquisitions limits our financial flexibility and makes us more likely to seek additional capital through future debt or equity financings. When we seek additional debt or equity financings, we cannot be certain that additional debt or equity will be available to us at all or on terms acceptable to us.
 
We may not be able to comply with certain of our debt covenants which may interfere with our ability to successfully execute our business plan.
 
Our debt arrangements require that we maintain compliance with certain financial covenants at each fiscal quarter-end and include an acceleration clause which allows the bank to declare amounts outstanding under the debt arrangements due and payable if it determines in good faith that a material adverse change has occurred in our financial condition or any of our subsidiaries.
 
We are currently in compliance with our debt covenants, but there can be no assurance that we will continue to be in compliance. If our performance does not result in compliance with any of our financial covenants, or if the bank seeks to exercise its rights under the acceleration clause referred to above, we would seek to modify the financing arrangements, but there can be no assurance that the bank would not exercise its rights and remedies under the debt arrangements, including accelerating payments of all outstanding senior debt due and payable. These payments would have a significantly adverse impact on our liquidity and our ability to obtain additional capital thereby jeopardizing our ability to successfully execute our business plan.
 
Our bank may not consent to our consummation of future acquisitions or the making of other investments.
 
We have pledged the majority of our assets to secure our bank financing arrangements. The bank’s consent continues to be required for acquisitions, divestitures and certain investments. For example, we were required to obtain the consent of the bank in order to enter into the recently announced business partnership arrangement for the purpose of constructing wind energy farms. There can be no assurance that our bank will consent to future investment transactions. If we are unable to obtain such consents, our ability to consummate acquisitions, dispose of assets, make investments or enter into other arrangements for the purpose of growing our business may be limited.

6


Our business growth could outpace the capability of our corporate management infrastructure which could adversely affect our ability to complete the execution of our business plan.
 
We cannot be certain that our current management team will be adequate to support our operations as they expand. Future growth could impose significant additional responsibilities on members of our senior management, including the need to recruit and integrate new senior level managers and executives. We cannot be certain that we can recruit and retain such additional managers and executives. To the extent that we are unable to attract and retain additional qualified management members in order to manage our growth effectively, we may not be able to expand our operations or execute our business plan. Our financial condition and results of operations could be materially and adversely affected as a result.
 
Loss of key personnel could prevent us from effectively managing our business.
 
Our ability to maintain productivity and profitability will be limited by our ability to employ, retain and train skilled personnel necessary to meet our requirements. We cannot be certain that we will be able to maintain an adequate skilled labor force necessary to operate efficiently and to support our growth strategy or that our labor expenses will not increase as a result of a shortage in the supply of these skilled personnel. Labor shortages or increased labor costs could impair our ability or maintain our business or grow our revenues.
 
We depend on the continued efforts of our executive officers and on senior management of the businesses we acquire. We cannot be certain that any individual will continue in such capacity for any particular period of time. The loss of key personnel, or the inability to hire and retain qualified employees, could negatively impact our ability to manage our business.
 
Specific Risks Relating to Our Power Industry Services
 
Failure to successfully operate our power industry services business will adversely affect us.
 
The operations of GPS represent a significant portion of our net sales and profits. Our inability to successfully develop, manage and provide our power industry services will adversely affect our overall business operations and financial condition. 
 
Interruption of power plant construction projects could adversely affect future results of operations.
 
At any time, GPS has a limited number of construction contracts. Should any unexpected suspension, termination or delay of the work under such contracts occur, our results of operations may be materially and adversely affected.
 
Investment in the wind energy farm business partnership may occur without expected returns.
 
In June 2008, we announced that GPS has entered into a business partnership with lnvenergy Wind Management LLC for the design and construction of wind energy farms located in the mid-western region of the United States into Canada. The partners will each own 50% of the new company, Gemma Renewable Power, LLC (“GRP”). We expect that GRP will annually provide engineering, procurement and construction services for new wind energy farms generating more than an estimated 300 megawatts of electrical power including the design and construction of roads, foundations and electrical collection systems well as the erection of towers, turbines and blades. The new venture shall also assist with some of the ongoing servicing of the wind farm equipment.
 
Should the future construction and other related services of GRP be at lower revenue levels than expected, or should GRP fail to profitably execute the projects that it may obtain, GPS may fail to receive returns from GRP as anticipated which may adversely affect our future results of our operations.

7


Resolution of the terminated construction contract may require cash payments by us.
 
GPS had a contract with Altra Nebraska, LLC for the construction of an ethanol-producing facility which was in suspension pending the efforts of the customer to obtain financing to complete construction of the plant. Under the terms of the amended engineering, procurement and construction agreement with the customer (the “EPC Agreement”), March 19, 2008 was the deadline for the customer to obtain financing for the project. If such financing was not obtained, GPS would be allowed to terminate the EPC Agreement at that time. GPS served termination notice but the customer has not acknowledged the termination or released the construction bond. GPS continues to cooperate with the customer in its efforts to obtain financing. GPS is uncertain as to the ultimate resolution of this matter. As of April 30, 2008 and January 31, 2008, our balance sheets included assets and liabilities related to the project. We expect that these assets will be realized and the liabilities extinguished. Although GPS does not anticipate any losses to arise from the resolution of this EPC Agreement, cash may be required to make payment on accounts payable to project subcontractors that are included in the condensed consolidated balance sheet at April 30, 2008 in advance of our receipt of any additional cash payments on outstanding accounts receivable from the customer.
 
If financing for alternative energy plants is unavailable, construction of such plants may not occur.
 
Traditional coal-fired and gas-fired power plants have been constructed typically by large utility companies. However, to a large extent, the financing for the construction of alternative energy plants is being provided by private investment groups. For example, investors in Green Earth Fuels of Houston, LLC, the owner of the bio diesel plant completed by GPS last year, include The Carlyle Group and Goldman Sachs.
 
We believe that the increase in the price of corn used to make ethanol has adversely affected the financial viability of the Altra project that is discussed above. Further, we believe that the challenge of securing financing in light of this development is being exacerbated by the general state of uncertainty in the bond markets.
 
Should debt financing for the construction of alternative or renewable energy plants not be available, investors may not be able to invest in such projects, thereby adversely affecting the likelihood that GPS or GRP will obtain contracts to construct such plants.
 
Our dependence on large construction contracts may result in uneven quarterly financial results.
 
Our power industry service activities in any one fiscal quarter are typically concentrated on a few large construction projects for which we use the percentage-of-completion method to determine contract revenues. To a substantial extent, construction contract revenues are recognized as services are provided based on the amount of costs incurred. As the timing of equipment purchases, subcontractor services and other contract events may not be evenly distributed over the lives of our contracts, the amount of total contract costs may vary from quarter to quarter, creating uneven amounts of quarterly contract revenues. In addition, the timing of contract commencements and completions may exacerbate the uneven pattern.
 
As a result of the foregoing, future amounts of consolidated net sales, cash flow from operations, net income and earnings per share reported on a quarterly basis may vary in an uneven pattern and may not be indicative of the operating results expected for any other quarter or for an entire fiscal year, thus rendering consecutive quarter comparisons of our consolidated operating results a less meaningful way to assess the growth of our business.

8


Intense competition in the engineering and construction industry could reduce our market share and profits.
 
We serve markets that are highly competitive and in which a large number of multinational companies compete. Among our competitors are U.S. companies, such as Fluor Corporation, EMCOR Group, Inc., The Shaw Group Inc., Washington Group International, Inc., and Perini Corporation, and international companies, such as SNC Lavalin Group, Inc. and Foster Wheeler Ltd. In particular, the engineering and construction markets are highly competitive and require substantial resources and capital investment in equipment, technology and skilled personnel. Competition also places downward pressure on our contract prices and profit margins. Intense competition is expected to continue in these markets, presenting us with significant challenges in our ability to maintain strong growth rates and acceptable profit margins. If we are unable to meet these competitive challenges, we could lose market share to our competitors and experience an overall reduction in our profits.
 
The cyclical nature of the markets we serve may adversely affect future operating results.
 
The demand for our services and products is dependent upon the existence of projects with engineering, procurement, construction and management needs. Although downturns can impact our business, our power markets exemplify businesses that are cyclical in nature. The power markets have historically been and will continue to be vulnerable to general downturns and are cyclical in nature. As a result, our past results have varied considerably and may continue to vary depending upon the demand for future projects in these industries.
 
Our inability to attract and retain qualified management and personnel would adversely affect the growth of this business.
 
Our future success is substantially dependent on the continued services and on the performance of the Vice Chairmen and the founding executive officers of GPS, Joel M. Canino and William F. Griffin, Jr. Messrs Canino and Griffin have extended the terms of their employments agreements to June 2009. In addition, GPS hired Timothy Curran in November 2007 to serve as the president and chief executive officer of GPS under an employment contract that expires on October 31, 2008 with automatic one-year extensions. There can be no assurance that Mr. Canino, Mr. Griffin or Mr. Curran will renew his employment agreement upon expiration of its term. The loss of the services of any one of these executives could materially and adversely affect our business. Our ability to achieve our development will also depend on our ability to attract and retain additional qualified and skilled personnel. Recruiting personnel in the energy power industry is competitive. We do not know whether we will be able to attract or retain additional qualified personnel. Our inability to attract and retain qualified personnel, or the departure of key employees, could materially and adversely affect our development and, therefore, our business, prospects, results of operations and financial condition.
 
Our backlog is subject to unexpected adjustments, delays and cancellations and is, therefore, an uncertain indicator of our future earnings.
 
As of April 30, 2008, our construction backlog was approximately $47 million. Not included in tis amount is a engineering, procurement and construction agreement with Pacific Gas & Electric Company (“PG&E”) in the amount of $340 million for the design and construction of a natural gas-fired power plant in Colusa, California signed in May 2008. This energy plant will be a 640 megawatt combined cycle facility and construction is expected to be completed in the summer of 2010. We expect that our performance of the work contemplated by this contract backlog will earn a substantial portion of this revenue in the fiscal year ending January 31, 2009. However, a project may remain our backlog for an extended period of time. In addition, project cancellations or scope adjustments may occur, from time to time, with respect to contracts reflected in our backlog and could reduce the dollar amount of our backlog and the revenue and profits that we actually earn. Poor project performance could also impact our backlog and profits. As a result, we cannot guarantee that the revenue projected in our backlog will be realized or profitable.
 
If the development of renewable energy sources does not occur, the demand for our construction services could decline.
 
Over half of the states have passed legislation requiring that utilities include a percentage of renewable energy in the mix of power they generate and buy. These future percentages may be as high as 20%, and the requirements are contributing to the increased momentum of efforts to develop sources of alternative renewable energy, including wind, solar, water, geothermal and biofuels. Should these government requirements be extended or repealed, the pace of the development of alternative renewable energy sources may slow, thereby reducing the future opportunities for GPS to construct such plants.

9


If tax credits are repealed, the development of alternative energy power plants may not be economical.
 
Current legislation offers tax credits and incentives to those utilizing alternative sources of energy. For example, federal legislation passed in 2005 established a tax credit that is intended to lower the cost of wind-powered energy for developers to equal the cost of energy produced by coal-fired power plants. However, this credit is set to expire at the end of 2008. To date, Congress has failed to move forward with a proposed extension of the credits.
 
In the event that federal legislative developments occur which decrease or cancel credits or incentives relating to alternative energy investments, the construction and use of alternative energy sources may not be economically viable. A decrease in the construction of alternative energy power plants may adversely affect the number of future business opportunities for us.
 
Future work delays and cost overruns could adversely affect our completion of construction projects.
 
The engineering and construction of plants for the generation of electric power or the production of alternative sources of energy such as ethanol and bio-diesel will be subject to the risks of delay or cost overruns resulting from numerous factors, including, but not limited to, the following:
 
 
·
shortages of skilled labor, materials and energy plant equipment including power turbines;
 
·
unscheduled delays in the delivery of ordered materials and equipment;
 
·
engineering problems, including those relating to the commissioning of newly designed equipment;
 
·
work stoppages;
 
·
weather interference;
 
·
cost increases, such as increases in the price of commodities such as corn or soybean or increases in or the availability of land at reasonable prices to grow corn and soybean;
 
·
price decreases for a barrel of oil;
 
·
inability to develop or non-acceptance of new technologies to produce alternative fuel sources; and
 
·
difficulties in obtaining necessary permits or approvals.

As we bear the risk of cost overruns in the dollar-value of our contracts, we may experience reduced profits or, in some cases, losses under these contracts if costs increase above our estimates.

We conduct our business under various types of contractual arrangements. We bear a significant portion of the risk for cost overruns. Under fixed price contracts, contract prices are established in part on cost and scheduling estimates which are based on a number of assumptions, including assumptions about future economic conditions, prices and availability of labor, equipment and materials, and other exigencies. If these estimates prove inaccurate, or circumstances change such as unanticipated technical problems, changes in local laws or labor conditions, weather delays, costs of raw materials or our suppliers’ or subcontractors’ inability to perform, cost overruns may occur and we could experience reduced profits, or in some cases, a loss for that project. From time to time, we may also assume a project’s technical risk, which means that we may have to satisfy certain technical requirements of a project despite the fact that at the time of project award, we may not have previously produced the system or product in question.

10


If we guarantee the timely completion or performance standards of a project, we could incur additional costs to cover our guarantee obligations.
In some instances and in many of our fixed price contracts, we guarantee a customer that we will complete a project by a scheduled date. We sometimes provide that the project, when completed, will also achieve certain performance standards. If we subsequently fail to complete the project as scheduled, or if the project subsequently fails to meet guaranteed performance standards, we may be held responsible for cost impacts to the customer resulting from any delay or modifications to the plant in order to achieve the performance standards, generally in the form of contractually agreed-upon liquidated damages. If these events would occur, the total costs of the project would exceed our original estimate, and we could experience reduced profits or a loss for that project.
 
Our use of the percentage-of-completion method of accounting could result in a reduction or reversal of previously recorded revenues or profits.
 
Under our accounting procedures, we measure and recognize a large portion of our profits and revenues under the percentage-of-completion accounting methodology. This methodology allows us to recognize revenues and profits ratably over the life of a contract by comparing the amount of the costs incurred to date against the total amount of costs expected to be incurred. The effect of revisions to revenues and estimated costs is recorded when the amounts are known and can be reasonably estimated, and these revisions can occur at any time and could be material. Given the uncertainties associated with these types of contracts, it is possible for actual costs to vary from estimates previously made, which may result in reductions or reversals of previously recorded revenues and profits.
 
Future bonding requirements may adversely affect our ability to compete for new energy plant construction projects.
 
Our construction contracts frequently require that we obtain payment and performance bonds from surety companies on behalf of our customers as a condition to the award of such contracts.
 
Surety market conditions have in the last few years become more difficult as a result of significant losses incurred by many surety companies, both in the construction industry as well as in certain large corporate bankruptcies. Consequently, less overall bonding capacity is available in the market than in the past, and surety bonds have become more expensive and restrictive. Historically, we have had a strong bonding capacity but, under standard terms in the surety market, surety companies issue bonds on a project-by- project basis and can decline to issue bonds at any time or require the posting of additional collateral as a condition to issuing any bonds.
 
Current or future market conditions, as well as changes in our surety’s assessment of its own operating and financial risk, could cause our surety company to decline to issue, or substantially reduce the amount of, bonds for our work and could increase our bonding costs. These actions can be taken on short notice. If our surety company were to limit or eliminate our access to bonding, our alternatives would include seeking bonding capacity from other surety companies, increasing business with clients that do not require bonds and posting other forms of collateral for project performance, such as letters of credit, or cash. We may be unable to secure these alternatives in a timely manner, on acceptable terms, or at all. Accordingly, if we were to experience an interruption or reduction in the availability of bonding capacity, we may be unable to compete for or work on certain projects.
 
Our dependence upon third parties to complete many of our contracts may adversely affect our performance under future energy plant construction contracts.
 
Much of the work performed under our contracts is actually performed by third-party subcontractors we hire. We also rely on third-party equipment manufacturers or suppliers to provide much of the equipment used for projects. If we are unable to hire qualified subcontractors or find qualified equipment manufacturers or suppliers, our ability to successfully complete a project could be impaired. If the amount we are required to pay for subcontractors or equipment and supplies exceeds what we have estimated, especially in a lump sum or a fixed-price type contract, we may suffer losses on these contracts. If a supplier, manufacturer or subcontractor fails to provide supplies, equipment or services as required under a negotiated contract for any reason, we may be required to source these supplies, equipment or services on a delayed basis or at a higher price than anticipated which could impact contract profitability in an adverse manner.

11


The nature of our engineering and construction business exposes us to potential liability claims and contract disputes which may reduce our profits.
 
We engage in engineering and construction activities for large facilities where design, construction or systems failures can result in substantial injury or damage to third parties. In addition, the nature of our business results in clients, subcontractors and vendors occasionally presenting claims against us for recovery of cost they incurred in excess of what they expected to incur, or for which they believe they are not contractually liable. We have been and may in the future be named as a defendant in legal proceedings where parties may make a claim for damages or other remedies with respect to our projects or other matters. These claims generally arise in the normal course of our business. When it is determined that we have liability, we may not be covered by insurance or, if covered, the dollar amount of these liabilities may exceed our policy limits. Our professional liability coverage is on a “claims-made” basis covering only claims actually made during the policy period currently in effect. In addition, even where insurance is maintained for such exposures, the policies have deductibles resulting in our assuming exposure for a layer of coverage with respect to any such claims. Any liability not covered by our insurance, in excess of our insurance limits or, if covered by insurance but subject to a high deductible, could result in a significant loss for us, which claims may reduce our future profits and cash available for operations.
 
We could be subject to claims and liabilities under environmental, health and safety laws and regulations that would add costs to our business.
 
Our operations are subject to compliance with United States federal, state and local environmental, health and safety laws and regulations, including those relating to discharges to air, water and land, the handling and disposal of solid and hazardous waste, and the cleanup of properties affected by hazardous substances. Certain environmental laws impose substantial penalties for non-compliance and others, such as the federal Comprehensive Environmental Response, Compensation and Liability Act, impose strict, retroactive, joint and several liability upon persons responsible for releases of hazardous substances. We continually evaluate whether we must take additional steps to ensure compliance with environmental laws, however, there can be no assurance that these requirements will not change and that compliance will not adversely affect our operations in the future.
 
The failure of our insurance policies to cover all of the risks we face could result in material future losses.
 
In accordance with customary industry practices, we maintain insurance coverage against some, but not all, potential losses in order to protect against the risks we face. We may elect not to carry insurance if our management believes that the cost of available insurance is excessive relative to the risks presented. In addition, we cannot insure fully against pollution and environmental risks. The occurrence of an event not fully covered by insurance could have a material adverse effect on our financial condition and results of operations.

12

 
Specific Risks Relating to Our Telecommunications Infrastructure Services Business
 
Loss of a significant customer could adversely affect our SMC business.
 
Our customers typically may cancel their contracts on short notice, typically 30 to 90 days, even if we are not in default under the contract. Certain of our largest customers assign work to us on a project-by-project basis under master service agreements. Under these agreements, the customers often have no obligation to assign work to us.
 
The failure to replace any unexpected reduction in work performed for our largest customers or the loss of any one of them as a significant customer could have a material adverse effect on our business, unless the loss is offset by increases in sales to other customers.
 
If we fail to compete successfully against current or future competitors, our business, financial condition and results of operations could be materially and adversely affected.
 
We operate in highly competitive markets. We compete with service providers ranging from small regional companies which service a single market, to larger firms servicing multiple regions, as well as large national and multi-national entities. In addition, there are few barriers to entry in the telecommunications infrastructure industry. As a result, any organization that has adequate financial resources and access to technical expertise may become one of our competitors.
 
Competition in the telecommunications infrastructure industry depends on a number of factors, including price. Certain of our competitors may have lower overhead cost structures than we do and may, therefore, be able to provide their services at lower rates than we can provide the same services. In addition, some of our competitors are larger and have significantly greater financial resources than we do. Our competitors may develop the expertise, experience and resources to provide services that are superior in price and quality to our services. Similarly, we may not be able to maintain or enhance our competitive position within our industry. We may also face competition from the in-house service organizations of our existing or prospective customers.
 
A significant portion of our business involves providing services, directly or indirectly as a subcontractor, to the United States government under government contracts. The United States government may limit the competitive bidding on any contract under a small business or minority set-aside, in which bidding is limited to companies meeting the criteria for a small business or minority business, respectively. We are currently qualified as a small business concern, but not a minority business.
 
We may not be able to compete successfully against our competitors in the future. If we fail to compete successfully against our current or future competitors, our business, financial condition, and results of operations could be materially and adversely affected.
 
Rapid technological change and/or customer consolidations could reduce the demand for the telecommunication services we provide.
 
The telecommunications infrastructure industry is undergoing rapid change as a result of technological advances that could in certain cases reduce the demand for our services or otherwise negatively impact our business. New or developing technologies could displace the wireline systems used for voice, video and data transmissions, and improvements in existing technology may allow telecommunications companies to significantly improve their networks without physically upgrading them. In addition, consolidation, competition or capital constraints in the utility, telecommunications or computer networking industries may result in reduced spending or the loss of one or more of our customers.

13


Our substantial dependence upon fixed price contracts may expose us to losses in the event that we fail to accurately estimate the costs that we will incur to complete such projects.
 
We currently generate, and expect to continue to generate, a significant portion of our revenues under fixed price contracts. We must estimate the costs of completing a particular project to bid for these fixed price contracts. Although historically we have been able to estimate costs accurately, the cost of labor and materials may, from time to time, vary from costs originally estimated. These variations, along with other risks inherent in performing fixed price contracts, may cause actual revenue and gross profits for a project to differ from those we originally estimated and could result in reduced profitability or losses on projects. Depending upon the size of a particular project, variations from the estimated contract costs can have a significant impact on our operating results for any fiscal quarter or year.
 
Compliance with government regulations may increase the costs of our operations and expose us to substantial civil and criminal penalties in the event that we violate applicable law.
 
We provide, either directly as a contractor or indirectly as a sub-contractor, products and services to the United States government under government contracts. United States government contracts and related customer orders subject us to various laws and regulations governing United States government contractors and subcontractors, generally which are more restrictive than for non-government contractors. These include subjecting us to examinations by government auditors and investigators, from time to time, to ensure compliance and to review costs. Violations may result in costs disallowed, and substantial civil or criminal liabilities (including, in severe cases, denial of future contracts).
 
Specific Risks Relating To Our Nutritional Products Business
 
The inability to replace lost customer business will continue to adversely affect operating results and financial condition. 
 
VLI is primarily a contract manufacturer of nutritional products. The ability to quickly replace lost customers or to increase the product offerings sold to existing customers is hampered by the long sales cycle inherent in our type of business. The length of time between the beginning of contract negotiation and the first sale to a new customer could exceed six months including extended periods of product testing and acceptance.
 
Accordingly, we do not expect this business to recover quickly despite the existence of new business prospects. Further, the loss of any existing customers or unexpected reductions in the levels of sales to such customers would exacerbate the negative and material effects of the business reductions experienced in the current year.
 
Negative publicity about us, our products and/or our industry could cause our business to suffer.
 
Our business depends, in part, upon the public’s belief in the safety and quality of our products. Although many of the ingredients in our products are vitamins, minerals, herbs and other substances for which there is a long history of human consumption, some of our products contain innovative ingredients or combinations of ingredients. Although we test the formulation and production of our products and we believe that all of our products are safe when used as directed, there may be little long-term experience with human consumption of certain of these product ingredients or combinations thereof. Further, we have not sponsored or conducted clinical studies on the effects of human consumption. Any adverse publicity about the safety or quality of our products or our competitors’ products, whether or not accurate, could negatively affect the public’s perception of us, our products, and/or our industry, resulting in a significant decline in the demand for our products and our future operating results. Our business and products could be adversely affected by negative publicity regarding, among other things:
 
 
·
the nutritional supplements industry;
 
·
competitors;

14


 
·
the safety and quality of our products and ingredients; and
 
·
regulatory investigations of our products or competitors’ products.
 
Our inability to respond to changing consumers’ demands and preferences could adversely affect our business.
 
The nutritional industry is subject to rapidly changing consumer demands and preferences. There can be no assurance that customers will continue to favor the products provided and manufactured by us. In addition, products that gain wide acceptance with consumers may result in a greater number of competitors entering the market which could result in downward price pressure which could adversely impact our financial results. We believe that any growth of this business will be materially dependent upon our ability to develop new techniques and processes necessary to meet the needs of our current customers and potential new customers. Our inability to anticipate and respond to these rapidly changing demands could have an adverse effect on our business operations.
 
Failure to perform effectively in an intensely competitive industry will harm our business.
 
The market for nutritional products is highly competitive. Our direct competition consists primarily of publicly and privately owned companies, which tend to be highly fragmented in terms of both geographical market coverage and product categories. These companies compete with us on different levels in the development, manufacture and marketing of nutritional supplements. Many of these companies have broader product lines and larger sales volume, are significantly larger than us, have greater name recognition, financial personnel, distribution and other resources than we do and may be better able to withstand volatile market conditions. There can be no assurance that our customers and potential customers will regard our products as sufficiently distinguishable from competitive products. Our inability to compete successfully would have a material adverse effect on our business.
 
The successful fulfillment of customer orders depends on our ability to obtain the necessary raw materials in a timely manner.
 
Although we believe that there are adequate sources of supply for all of our principal raw materials we require, there can be no assurance that our sources of supply for our principal raw materials will be adequate in all circumstances. In the event that such sources are not adequate, we will have to find alternate sources. As a result we may experience delays in locating and establishing relationships with alternate sources which could result in product shortages and backorders for our products, with a resulting loss of revenue to us.
 
Future product liability claims may expose us to unexpected damages and expenses which could adversely affect our results of operation and financial condition.
 
We could face financial liability due to product liability claims if the use of our products results in significant loss or injury. To date, we have not been the subject of any product liability claims. However, we can make no assurances that we will not be exposed to future product liability claims. Such claims may include that our products contain contaminants, that we provide consumers with inadequate instructions regarding product use, or that we provide inadequate warnings concerning side effects or interactions of our products with other substances. We believe that we maintain adequate product liability insurance coverage. However, a product liability claim could exceed the amount of our insurance coverage or a product claim could be excluded under the terms of our existing insurance policy, which could adversely affect our future results of operations and financial condition.

15


A violation of government regulations or our inability to obtain necessary government approvals for our products could harm our business.
 
The formulation, manufacturing, packaging, labeling, advertising, distribution and sale of our products are subject to regulation by one or more federal agencies, including the Food and Drug Administration (FDA), the Federal Trade Commission (FTC), the Consumer Product Safety Commission, the U.S. Department of Agriculture, the Environmental Protection Agency, and also by various agencies of the states, localities and foreign countries in which our products are sold. In particular, the FDA, pursuant to the Federal Food, Drug, and Cosmetic Act (FDCA), regulates the formulation, manufacturing, packaging, labeling, distribution and sale of dietary supplements, including vitamins, minerals and herbs, and of over-the-counter (OTC) drugs, while the FTC has jurisdiction to regulate advertising of these products, and the US Postal Service regulates advertising claims with respect to such products sold by mail order. The FDCA has been amended several times with respect to dietary supplements, most recently by the Nutrition Labeling and Education Act of 1990 and the Dietary Supplement Health and Education Act of 1994. In addition, our products are also subject to regulations under various state and local laws that include provisions governing, among other things, the formulation, manufacturing, packaging, labeling, advertising and distribution of dietary supplements and OTC drugs. Our inability to comply with these numerous regulations could harm our business, resulting in, among other things, injunctions, product withdrawals, recalls, product seizures, fines and criminal prosecutions.

In the future, we may become subject to additional laws or regulations administered by the FDA or by other federal, state, local or foreign regulatory authorities, to the repeal of laws or regulations that we consider favorable, or to more stringent interpretations of current laws or regulations. We can neither predict the nature of such future laws, regulations, repeals or interpretations, nor can we predict what effect additional governmental regulation, when and if it occurs, would have on our business. These regulations could, however, require the reformation of certain products to meet new standards, the recall or discontinuance of certain products not able to be reformulated, additional record-keeping requirements, increased documentation of the properties of certain products, additional or different labeling, additional scientific substantiation or other new requirements. Any of these developments could result in sales reductions and/or unanticipated expenses having material adverse effects on our business.
 
Our inability to adequately protect our products from replication by competitors could have a material adverse effect on our business.
 
We own proprietary formulas for certain of our nutritional products. We regard our proprietary formulas as valuable assets and believe they have significant value in the marketing of our products. Because we do not have patents or trademarks on our products, there can be no assurance that another company will not replicate and market one or more of our products, thereby causing us to lose business.
 
Risks Relating to Our Securities
 
Our acquisition strategy may result in dilution to our stockholders.
 
Our business strategy calls for the strategic acquisition of other businesses. In connection with our acquisitions of GPS and VLI, among other consideration, we issued approximately 3,667,000 and 1,785,000 shares of our common stock, respectively. In addition, we issued 2,200,000 shares and approximately 2,853,000 shares of our common stock, respectively, in our July 2008 and December 2006 private placements. In the aggregate, the number of shares issued pursuant to these transactions represents approximately 79% of our currently outstanding shares of common stock. We anticipate that future acquisitions will require cash and issuances of our capital stock, including our common stock. To the extent we are required to pay cash for any acquisition, we anticipate that we would be required to obtain additional equity and/or debt financing. Equity financing would result in dilution for our then current stockholders. Stock issuances and financing, if obtained, may not be on terms favorable to us and could result in substantial dilution to our stockholders at the time(s) of these stock issuances and financings.

16


Our officers, directors and certain key employees have substantial control over Argan.
 
As of April 30, 2008, our executive officers and directors as a group owned approximately 17.5% of our voting shares (giving effect to an aggregate of 330,000 shares of common stock that may be purchased upon exercise of warrants and stock options held by our executive officers and directors and 1,323,270 shares beneficially held in the name of MSR Advisors, Inc. and affiliates for which one of our directors is President). In addition, another 42% of our voting shares were owned by Messrs. Canino and Griffin, by Allen & Company affiliates and a single unaffiliated stockholder. Therefore, this small group of stockholders may have significant influence over corporate actions such as an amendment to our certificate of incorporation, the consummation of any merger, or the sale of all or substantially all of our assets, and may substantially influence the election of directors and other actions requiring stockholder approval.
 
As of April 30, 2008, William F. Griffin, Jr. and Joel M. Canino, executive officers of GPS, own approximately 12.6% and 10.6% of our outstanding voting shares, respectively. Therefore, Messrs. Canino and Griffin, together or individually, may have the power to influence corporate actions.
 
As our common stock is thinly traded, the stock price may be volatile and you may have difficulty disposing of your investment at prevailing market prices.
 
In August 2007, our common stock was approved for listing on the American Stock Exchange and commenced trading under the symbol AGX. Until August 2007, our common stock traded over-the- counter under the symbol AGAX.OB. Our common stock was also listed on the Boston Stock Exchange under the symbol AGX from August 4, 2003 until its voluntary delisting in September 2007. However, there were no sales of the Company’s securities on the Boston Stock Exchange during the previous two years.
 
Despite the new listing, our common stock remains thinly and sporadically traded and no assurances can be given that a larger market will ever develop, or if developed, that it will be maintained.
 
Availability of significant amounts of our common stock for sale could adversely affect its market price.
 
We have recently registered for issuance and resale significant amounts of our common stock. If our stockholders sell substantial amounts of our common stock in the public market, including shares registered under any registration statement on Form S-3, the market price of our common stock could fall.
 
We may issue preferred stock with rights that are superior to our common stock.
 
Our Certificate of Incorporation, as amended, permits our Board of Directors to authorize the issuance of shares of preferred stock and to designate the terms of the preferred stock. The issuance of shares of preferred stock by us could adversely affect the rights of holders of common stock by, among other factors, establishing dividend rights, liquidation rights and voting rights that are superior to the rights of the holders of the common stock.
 
Provisions of our certificate of incorporation and Delaware law could deter takeover attempts.
 
Provisions of our certificate of incorporation and Delaware law could delay, prevent, or make more difficult a merger, tender offer or proxy contest involving us. Among other things, under our certificate of incorporation, our board of directors may issue up to 500,000 shares of our preferred stock and may determine the price, rights, preferences, privileges and restrictions, including voting and conversion rights, of these shares of preferred stock. In addition, Delaware law limits transactions between us and persons that acquire significant amounts of our stock without approval of our board of directors.
 
We do not expect to pay dividends for the foreseeable future.
 
We have not paid cash dividends on our common stock since our inception and intend to retain earnings, if any, to finance the development and expansion of our business. As a result, we do not anticipate paying dividends on our common stock in the foreseeable future. Payment of dividends, if any, will depend on our future earnings, capital requirements and financial position, plans for expansion, general economic conditions and other pertinent factors.

17


USE OF PROCEEDS
 
The proceeds from the sale of the shares of our common stock being offered by the selling shareholders pursuant to this prospectus and any prospectus supplement, if applicable, net of any broker’s fee or commissions, will belong to the selling shareholders. Accordingly, we will not receive any of the proceeds from the sale of these shares.

SELLING SHAREHOLDERS
 
The following table provides information regarding the selling shareholders and the number of shares each selling shareholder is offering. We have prepared this table based on information furnished to us by or on behalf of the selling shareholders. Under the rules of the SEC, beneficial ownership includes shares over which the indicated beneficial owner exercises voting or investment power. Beneficial ownership is determined under Section 13(d) of the Securities Exchange Act of 1934 (the “Exchange Act”). Unless otherwise indicated in the footnotes below, we believe that the selling shareholders have sole voting and investment power with respect to all shares beneficially owned. The percentage ownership data is based on 13,325,026 shares of our common stock issued and outstanding as of July 2, 2008. Since the date on which they provided us with the information below, the selling shareholders may have sold, transferred or otherwise disposed of some or all of their shares in transactions exempt from the registration requirements of the Securities Act.
 
The shares may be sold by the selling shareholders, by those persons or entities to whom they transfer, donate, devise, pledge or distribute their shares or by other successors in interest. The information regarding shares beneficially owned after this offering assumes the sale of all shares offered by each of the selling shareholders. The selling shareholders may sell less than all of the shares listed in the table. In addition, the shares listed below may be sold pursuant to this prospectus or in privately negotiated transactions. Accordingly, we cannot estimate the number of shares the selling shareholders will sell under this prospectus.
 
Except as indicated in the footnotes below, the selling shareholders have not held any position or office or had any other material relationship with us or any of our predecessors or affiliates within the past three years.
 
The selling shareholders have represented to us that they purchased the shares for their own account, for investment only and not with a view toward selling or distributing them in violation of the Securities Act, except in sales either registered under the Securities Act, or sales that are exempt from registration. In recognition of the fact that the selling shareholders, even though purchasing their shares for investment, may wish to be legally permitted to sell their shares when they deem appropriate, we agreed with the selling shareholders to file a registration statement to register the resale of the shares. We have also agreed to prepare and file all amendments and supplements necessary to keep the registration statement effective until the earlier of (i) the date on which the selling shareholders may resell all the shares covered by the registration statement without registration pursuant to Rule 144 under the Securities Act or any successor rule thereto and (ii) the date on which the selling shareholders have sold all the shares covered by the registration statement.

18

 
Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Gerald Abrams, Owner
Curtis Y Mobile Home
17 Cove Road
Rhinebeck, NY 12572
   
1300
   
1300
   
0
   
 
Gerald Abrams
17 Cove Road
Rhinebeck, NY 12572
   
1700
   
1700
   
0
   
 
Gerald Abrams, Trustee
Venture Lake Estates PSP
17 Cove Road
Rhinebeck, NY 12572
   
8400
   
8400
   
0
   
 
David Anastos
37 Noyac Bay Avenue
Sag Harbor, NY 11963
   
990
   
990
   
0
   
 
Peter Anastos
37 Noyac Bay Avenue
Sag Harbor, NY 11963
   
540
   
540
   
0
   
 
Dorothea and John Antonell
315 Old Post Road
Rhinebeck, NY 12572
   
100
   
100
   
0
   
 
John Antonell IRA
315 Old Post Road
Rhinebeck, NY 12572
   
2620
   
2620
   
0
   
 
Dorothea Antonell IRA
315 Old Post Road
Rhinebeck, NY 12572
   
100
   
100
   
0
   
 
Allan E. Atzrott
50 Springview Lane
Hopewell Jct, NY 12533
   
1500
   
1500
   
0
   
 
St. Lukes Cornwall Hospital
BIATC as Dir TTEE
70 Dubois Street
Newburgh, NY 12550
   
650
   
650
   
0
   
 
Barbara Baker
155 Mount Zion Road
Marlboro, NY 12542
   
3100
   
3100
   
0
   
 
Barbara Baker IRA
155 Mount Zion Road
Marlboro, NY 12542
   
2500
   
2500
   
0
   
 

19


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Daniel Baker
Baker Single #1
P. O. Box 219
Teton Village, WY 83025
   
370
   
370
   
0
   
 
Daniel Baker
Baker Two Life #3
P. O. Box 219
Teton Village, WY 83025
   
1180
   
1180
   
0
   
 
Daniel Baker
Baker Single #2
P. O. Box 219
Teton Village, WY 83025
   
500
   
500
   
0
   
 
Daniel Baker
Baker Single #3
P. O. Box 219
Teton Village, WY 83025
   
560
   
560
   
0
   
 
Daniel Baker, Trustee
Baker CRUT #1
P. O. Box 219
Teton Village, WY 83025
   
1070
   
1070
   
0
   
 
Daniel Baker
Baker CRUT #2
P. O. Box 219
Teton Village, WY 83025
   
1050
   
1050
   
0
   
 
Daniel Baker, Patricia Baker
Baker Family LP
P. O. Box 219
Teton Village, WY 83025
   
15500
   
15500
   
0
   
 
Daniel Baker
P. O. Box 219
Teton Village, WY 83025
   
4800
   
4800
   
0
   
 
Patricia Baker
P. O. Box 219
Teton Village, WY 83025
   
2000
   
2000
   
0
   
 
Patricia Baker
Baker P Single Life #1
P. O. Box 219
Teton Village, WY 83025
   
350
   
350
   
0
   
 
Patricia Baker
Baker P Single CRUT #2
P. O. Box 219
Teton Village, WY 83025
   
420
   
420
   
0
   
 
 
20


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Patricia Baker
Baker P Single #3
P. O. Box 219
Teton Village, WY 83025
   
820
   
820
   
0
   
 
Patricia Baker
Baker P Two Life #2
P. O. Box 219
Teton Village, WY 83025
   
1100
   
1100
   
0
   
 
Patricia Baker
Baker P Two Life #1
P. O. Box 219
Teton Village, WY 83025
   
1100
   
1100
   
0
   
 
Patricia Baker
Baker P Two Life #3
P. O. Box 219
Teton Village, WY 83025
   
1200
   
1200
   
0
   
 
Frederick & Suzanne Battenfeld
867 Route 199
Red Hook, NY 12571
   
10000
   
10000
   
0
   
 
Suzanne Battenfeld
867 Route 199
Red Hook, NY 12571
   
18000
   
18000
   
0
   
 
Frederick Battenfeld
867 Route 199
Red Hook, NY 12571-4710
   
8000
   
8000
   
0
   
 
Suzanne Battenfeld
867 Route 199
Red Hook, NY 12571
   
7000
   
7000
   
0
   
 
Richard Bayles, Trustee
Bayles Marital Trust
3697 SE Doubleton Drive
Stuart, FL 34997
   
9500
   
9500
   
0
   
 
Richard Bayles, Trustee
Richard Bayles Rev Trust
3697 SE Doubleton Drive
Stuart, FL 34997
   
40200
   
40200
   
0
   
 
Richard A. Bayles, Trustee
Bayles Trust B
3697 SE Doubleton Drive
Stuart, FL 34997
   
10300
   
10300
   
0
   
 
Richard A. Bayles
3697 SE Doubleton Drive
Stuart, FL 34997
   
4300
   
4300
   
0
   
 
 
21


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Peter Bloom IRA
17 Water Way
Newburgh, NY 12550
   
2150
   
2150
   
0
   
 
Shirley Bogdanffy
110 Beechwood Drive
Wayne, NJ 07470
   
3700
   
3700
   
0
   
 
Mark W. Brown
AVEMA 401k FBO Brown
5916 Filaree Heights
Malibu, CA 90265
   
100
   
100
   
0
   
 
Mark Walter Brown
5916 Filaree Heights
Malibu, CA 90265
   
1800
   
1800
   
0
   
 
David J. Callard, Trustee
Frank Bonsal Rev Trust
c/o DLA Piper Rudnick
Baltimore, MD 21209
   
1860
   
1860
   
0
   
 
Leona Borchert, Trustee
Trust U/W/O Ernest Borchert
182 Smoke Rise Ridge
Basking Ridge, NJ 07920
   
560
   
560
   
0
   
 
Leona Borchert
182 Smoke Rise Ridge
Basking Ridge, NJ 07920
   
6300
   
6300
   
0
   
 
Spruille Braden IRA
20 Colonial Drive
Bethel, CT 06801
   
770
   
770
   
0
   
 
Michael & Linda Brooks
Joint Account
481 Gidney Avenue
Newburgh, NY 12550
   
1200
   
1200
   
0
   
 
Barry Brown IRA
53 Larkspur Lane
Rochester, NY 14622
   
5000
   
5000
   
0
   
 
Barry Brown IRA
53 Larkspur Lane
Rochester, NY 14622
   
300
   
300
   
0
   
 
Barry Brown
53 Larkspur Lane
Rochester, NY 14622
   
500
   
500
   
0
   
 
Judith Brown IRA
53 Larkspur Lane
Rochester, NY 14622
   
990
   
990
   
0
   
 

22


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Judith Brown IRA
53 Larkspur Lane
Rochester, NY 14622
   
700
   
700
   
0
   
 
Ed Cahill
775 High Street
Dedham, MA 02026
   
6700
   
6700
   
0
   
 
David Callard & John Olson, Trustees
David Callard Living Trust
1120 Fifth Avenue, #5B
New York, NY 10128
   
47850
   
47850
   
0
   
 
Joseph Catania IRA
21 Susan Drive
Newburgh, NY 12550
   
4920
   
4920
   
0
   
 
Joseph & Dorothy Catania
21 Susan Drive
Newburgh, NY 12550
   
11400
   
11400
   
0
   
 
Joseph Catania Roth IRA
21 Susan Drive
Newburgh, NY 12550
   
1450
   
1450
   
0
   
 
Pamela Catania
628 River Road
Newburgh, NY 12550
   
7060
   
7060
   
0
   
 
Joseph Catania, Jr. IRA
628 River Road
Newburgh, NY 12550
   
450
   
450
   
0
   
 
Steven Chamberlain
5177 Harpers Farm Road
Columbia, MD 21044
   
7300
   
7300
   
0
   
 
Jacqueline Rumsey & Betty Evans
Church of Good Shepherd
P. O. Box 2865
Newburgh, NY 12550
   
6200
   
6200
   
0
   
 
Jacqueline Rumsey & Betty Evans
Church of Good Shepherd
P. O. Box 2865
Newburgh, NY 12550
   
4600
   
4600
   
0
   
 
Jacqueline Rumsey & Betty Evans
Church of Good Shepherd
P. O. Box 2865
Newburgh, NY 12550
   
39800
   
3980
   
0
   
 
 
23


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Peter Cricchio
79 Orange Street
Marlboro, NY 12542
   
3100
   
3100
   
0
   
 
Josephine Cricchio
79 Orange Street
Marlboro, NY 12542
   
3100
   
3100
   
0
   
 
Rosemarie Cricchio
79 Orange Street
Marlboro, NY 12542
   
3300
   
3300
   
0
   
 
Matilda Davenport
Box 236
Stone Ridge, NY 12484
   
4000
   
4000
   
0
   
 
William Davenport
Box 236
Stone Ridge, NY 12484
   
1700
   
1700
   
0
   
 
Martin Desmary IRA
9516 Laurelwood Court
Fort Pierce, FL 34951
   
25690
   
25690
   
0
   
 
Alice Dibble
114 Chesham Drive
Middlebury, CT 06762
   
7000
   
7000
   
0
   
 
John Dibble
114 Chesham Drive
Middlebury, CT 06762
   
4800
   
4800
   
0
   
 
Drake Loeb Heller Kennedy, Trustees
Drake Loeb Heller Kennedy et al.
New Windsor, NY 12553
   
17050
   
17050
   
0
   
 
Ira & Steven Effron, Trustees
EFCO Products Pension Plan
136 Smith Street
Poughkeepsie, NY 12601
   
19500
   
19500
   
0
   
 
Ira & Steven Effron, Trustees
EFCO Products PSP
136 Smith Street
Poughkeepsie, NY 12601
   
10000
   
10000
   
0
   
 
William A. Eudailey
193 Sturbridge Drive
Osterville, MA 02655
   
6300
   
6300
   
0
   
 
William Eudailey IRA
193 Sturbridge Drive
Osterville, MA 02655
   
2200
   
2200
   
0
   
 
 
24


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Elisha & Maria Fisch, Trustees
Fisch & Fisch 401k & PSP
66 Cliffside Lane
Mount Kisco, NY 10549
   
11600
   
11600
   
0
   
 
Steven Ganfer & Steven Shore, Trustees
Ganfer & Shore 401k
360 Lexington Avenue
New York, NY 10017
   
3250
   
3250
   
0
   
 
Steven Ganfer & Steven Shore, Trustees
Ganfer & Shore Pension Plan
360 Lexington Avenue
New York, NY 10017
   
4160
   
4160
   
0
   
 
Lynn E. Gorguze, Trustee
Lynn E. Gorguze Separate Prop Tr
1200 Prospect Street, Ste. 325
La Jolla, CA 92037
   
91980
   
91980
   
0
   
 
Lynn E. Gorguze, Trustee
Ellen Peters Trust
1200 Prospect Street, Ste. 325
La Jolla, CA 92037
   
1310
   
1310
   
0
   
 
Lynn E. Gorguze cust FBO Ellen Peters, Custodian
c/o Cameron Holdings Corp.
1200 Prospect Street, Ste. 325
La Jolla, CA 92037
   
6600
   
660
   
0
   
 
Lynn E. Gorguze Scott Peters, Trustee
Lynn Gorguze Scott Peters Comm Prop Trust
1200 Prospect Street, Ste. 325
La Jolla, CA 92037
   
5740
   
5740
   
0
   
 
 
25


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Lynn Gorguze FBO Benjamin Peters, Custodian
c/o Cameron Holdings Corp.
1200 Prospect Street, Ste. 325
La Jolla, CA 92037
   
430
   
430
   
0
   
 
Lynn E. Gorguze, Trustee
Benjamin V. Peters Trust
1200 Prospect Street, Ste. 325
La Jolla, CA 92037
   
1580
   
1560
   
0
   
 
Lynn E. Gorguze IRA
c/o Cameron Holdings Corp.
1200 Prospect Street, Ste. 325
La Jolla, CA 92037
   
1050
   
1050
   
0
   
 
Vincent & Gloria Gorguze, Trustees
Vincent & Gloria Gorguze Trust
1200 Prospect Street, Ste. 325
La Jolla, CA 92037
   
108410
   
108410
   
0
   
 
Vincent T. Gorguze IRA
c/o Cameron Holdings Corp.
1200 Prospect Street, Ste. 325
La Jolla, CA 92037
   
1000
   
1000
   
0
   
 
Jack S. Griswold IRA
c/o Brown Advisory
901 S. Bond Street, Ste. 400
Baltimore, MD 21231
   
6900
   
6900
   
0
   
 
Elizabeth Henry
4 Henry Lane
New Windsor, NY 12553
   
1500
   
1500
   
0
   
 
Lorraine M. Herring
110 Holmes Road
Newburgh, NY 12550
   
1510
   
1510
   
0
   
 
David Hershberg
15 Waterview Drive
Prt Jefferson, NY 11777
   
2900
   
2900
   
0
   
 
Edward Hyman
ISI Group
40 West 57th Street, 18th Fl.
New York, NY 10019
   
6540
   
6540
   
0
   
 
 
26


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Steven Katz IRA
33 Hornbeck Ridge
Poughkeepsie, NY 12603
   
8020
   
8020
   
0
   
 
Gladys Kirkland
222 SE Becky Terrace
Lake City, FL 32025
   
4700
   
4700
   
0
   
 
Steven Kirshon, Trustee
Kirshon & Co. PSP
311 Mill Street
Poughkeepsie, NY 12601
   
4300
   
4300
   
0
   
 
Jacques Kohn
45 E. 89th Street, Apt. 29E
New York, NY 10128
   
18760
   
18760
   
0
   
 
Jacques and Margot Kohn
45 E. 89th Street, Apt. 29E
New York, NY 10128
   
5890
   
5890
   
0
   
 
Margot Kohn IRA
45 E. 89th Street, Apt. 29E
New York, NY 10128
   
11600
   
11600
   
0
   
 
Barbara Krieger
4 Kimball Road
Poughkeepsie, NY 12601
   
25250
   
25250
   
0
   
 
William Kwock
25 Cassel Road
Milton, NY 12547
   
11970
   
11970
   
0
   
 
William Kwock, Trustee
Orthopedic Associates #1
1 Webster Avenue, Ste. 400
Poughkeepsie, NY 12601
   
11000
   
11000
   
0
   
 
William Kwock, Trustee
Orthopedic Associates #2
1 Webster Avenue, Ste. 400
Poughkeepsie, NY 12601
   
9900
   
9900
   
0
   
 
Paul Labieniec, Trustee
Helen A. Labieniec Credit Exempt Tr
10701 Spring Run Road
Chesterfield, VA 23832
   
3300
   
3300
   
0
   
 
Paul Labieniec
10701 Spring Run Road
Chesterfield, VA 23832
   
580
   
580
   
0
   
 
Paul Labieniec IRA
10701 Spring Run Road
Chesterfield, VA 23832
   
600
   
600
   
0
   
 
 
27


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Tristan & Susanne Laurion
6 Pea Hill Road
New Windsor, NY 12553
   
3400
   
3400
   
0
   
 
Tristan Laurion IRA
6 Pea Hill Road
New Windsor, NY 12553
   
12000
   
12000
   
0
   
 
Tristan Laurion IRA
6 Pea Hill Road
New Windsor, NY 12553
   
300
   
300
   
0
   
 
John Montfort
44 Elm Street
Fishkill, NY 12524
   
96000
   
96000
   
0
   
 
John Montfort IRA
44 Elm Street
Fishkill, NY 12524
   
5000
   
5000
   
0
   
 
Steven & Amy Almany
2753 Turtle Lake Road
Bloomfield Hills, MI 48302
   
1400
   
1400
   
0
   
 
Steven Almany, Trustee
Steven Almany PSP
2753 Turtle Lake Road
Bloomfield Hills, MI 48302
   
130
   
130
   
0
   
 
Stephen M. Lipton IRA
21 Adriance Avenue
Poughkeepsie, NY 12601
   
990
   
990
   
0
   
 
Lynn C. Lipton IRA
21 Adriance Avenue
Poughkeepsie, NY 12601
   
1500
   
1500
   
0
   
 
Lynn C. Lipton
21 Adriance Avenue
Poughkeepsie, NY 12601
   
200
   
200
   
0
   
 
Stephen M. Lipton, Trustee
Lipton PSP
21 Adriance Avenue
Poughkeepsie, NY 12601
   
1080
   
1080
   
0
   
 
Carol Looney
9 Pheasant Lane
Lexington, MA 02421
   
5000
   
5000
   
0
   
 
Paul Looney IRA
9 Pheasant Lane
Lexington, MA 02421
   
7000
   
7000
   
0
   
 
Carol Looney IRA
9 Pheasant Lane
Lexington, MA 02421
   
800
   
800
   
0
   
 
 
28


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Paul Looney IRA
9 Pheasant Lane
Lexington, MA 02421
   
3000
   
3000
   
0
   
 
Peter Lumb
831 North Avenue
Salt Point, NY 12578
   
3200
   
3200
   
0
   
 
Elizabeth Lumb
831 North Avenue
Salt Point, NY 12578
   
1900
   
1900
   
0
   
 
Barbara Lumb & Elizabeth Lumb, Trustees
Charles B. Grubb Trust
177 Titusville Road
Poughkeepsie, NY 12603
   
3000
   
3000
   
0
   
 
Stephen Lumb
177 Titusville Road
Poughkeepsie, NY 12603
   
2500
   
2500
   
0
   
 
Barbara Lumb
177 Titusville Road
Poughkeepsie, NY 12603
   
900
   
900
   
0
   
 
Stephen Lumb IRA
177 Titusville Road
Poughkeepsie, NY 12603
   
700
   
700
   
0
   
 
William Lyons
P. O. Box 120
Marlboro, NY 12542
   
3000
   
3000
   
0
   
 
William Lyons IRA
P. O. Box 120
Marlboro, NY 12542
   
2670
   
2670
   
0
   
 
Beryl Maddows
333 Pleasant Street
Raynham, MA 02767
   
3970
   
3970
   
0
   
 
Steven Maier
4 Harlequin Drive
Sheridan, WY 82801
   
2470
   
2470
   
0
   
 
Elizabeth Manion
121 Western Avenue
Marlboro, NY 12542
   
1700
   
1700
   
0
   
 
James Manion IRA
121 Western Avenue
Marlboro, NY 12542
   
5000
   
5000
   
0
   
 
James Manion IRA 2
121 Western Avenue
Marlboro, NY 12542
   
2000
   
2000
   
0
   
 
 
29


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
James Manion IRA 3
121 Western Avenue
Marlboro, NY 12542
   
2000
   
2000
   
0
   
 
Jeffrey & Allison McKibben
49 East 21st Street, Apt. 7B
New York, NY 10010
   
100
   
100
   
0
   
 
JR Moody IRA
9914 East Palo Brea Drive
Scottsdale, AZ 85262
   
3600
   
3600
   
0
   
 
Kathleen Moody IRA
9914 East Palo Brea Drive
Scottsdale, AZ 85262
   
300
   
300
   
0
   
 
J. Roger Moody
Sandpiper Synergies
9914 East Palo Brea Drive
Scottsdale, AZ 85262
   
11200
   
11200
   
0
   
 
J. Roger Moody, Trustee
Roger Moody Pen Pln
9914 East Palo Brea Drive
Scottsdale, AZ 85262
   
17270
   
17270
   
0
   
 
W. Christopher Mortenson
P. O. Box 617
Oldwick, NJ 08858
   
1300
   
1300
   
0
   
 
Francis Murphy
17 Seaborn Place
Lexington, MA 02420
   
5900
   
5900
   
0
   
 
Francis Murphy IRA
17 Seaborn Place
Lexington, MA 02420
   
700
   
700
   
0
   
 
Kurt Najork
22 Van Orden Road
Milton, NY 12547
   
650
   
650
   
0
   
 
Robert A. Nicklin
242 West Minnesota Street
Le Center, MN 56057
   
7000
   
7000
   
0
   
 
Carol Nicklin
95 Mt. Zion Road
Marlboro, NY 12542
   
2210
   
2210
   
0
   
 
John Nicklin, Jr.
95 Mt. Zion Road
Marlboro, NY 12542
   
1590
   
1590
   
0
   
 
John W. Nicklin
1290 Bay Dale Drive, #290
Arnold, MD 21012
   
6760
   
6760
   
0
   
 
 
30


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Jonathan Case Nicklin
216 Upland Road, Floor 1
Cambridge, MA 02140
   
5500
   
5500
   
0
   
 
William T. Nicklin
82 Seven Bridges
Chappaqua, NY 10514
   
1200
   
1200
   
0
   
 
John O’Shea IRA
19 Alden Road
Poughkeepsie, NY 12603
   
16600
   
16600
   
0
   
 
John O’Shea
19 Alden Road
Poughkeepsie, NY 12603
   
12000
   
12000
   
0
   
 
Nancy O’Shea
19 Alden Road
Poughkeepsie, NY 12603
   
2000
   
2000
   
0
   
 
Albert & Dorothy Pagano Sr.
13 Cross Road
Marlboro, NY 12542
   
4270
   
4270
   
0
   
 
Albert Pagano Sr.
13 Cross Road
Marlboro, NY 12542
   
3890
   
3890
   
0
   
 
Albert Pagano Sr. IRA
13 Cross Road
Marlboro, NY 12542
   
850
   
850
   
0
   
 
Dorothy Pagano IRA
13 Cross Road
Marlboro, NY 12542
   
400
   
400
   
0
   
 
Anthony Pascale IRA
28 Riverwood Drive
Marlboro, NY 12542
   
8200
   
8200
   
0
   
 
Anthony Pascale IRA
28 Riverwood Drive
Marlboro, NY 12542
   
960
   
960
   
0
   
 
Sandra A. Pascale IRA
28 Riverwood Drive
Marlboro, NY 12542
   
4180
   
4180
   
0
   
 
Anthony M. Pascale
Anthony Pascale PSP FBO Anthony
28 Riverwood Drive
Marlboro, NY 12542
   
3800
   
3800
   
0
   
 
Anthony M. Pascale & Sandra Pascale
28 Riverwood Drive
Marlboro, NY 12542
   
2500
   
2500
   
0
   
 
 
31


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Marilynn Petrillo IRA
153 Holmes Road
Newburgh, NY 12550
   
150
   
150
   
0
   
 
Ted Petrillo
153 Holmes Road
Newburgh, NY 12550
   
700
   
700
   
0
   
 
Albert Petrosino IRA
612 River Road
Newburgh, NY 12250
   
5000
   
5000
   
0
   
 
George Rich, Trustee
Rich Family Foundation
904 South Broadway
Baltimore, MD 21231
   
12450
   
12450
   
0
   
 
George & Isabel Rich, Trustees
George & Isabel Rich Trust
904 South Broadway
Baltimore, MD 21231
   
700
   
700
   
0
   
 
George Rich, Trustee
George Rich Jr. Trust
904 South Broadway
Baltimore, MD 21231
   
3140
   
3140
   
0
   
 
George Rich, Trustee
Alexandra Rich Trust
904 South Broadway
Baltimore, MD 21231
   
2350
   
2350
   
0
   
 
George Rich IRA
904 South Broadway
Baltimore, MD 21231
   
920
   
920
   
0
   
 
George Rich
904 South Broadway
Baltimore, MD 21231
   
6800
   
6800
   
0
   
 
Rider, Weiner, Frankel, Crush, Trustees
Rider Weiner & Frankel PSP
655 Little Britain Road
New Windsor, NY 12553
   
16100
   
16100
   
0
   
 
Jacqueline Rumsey, Trustee
William Rumsey Trust
P. O. Box 4101
New Windsor, NY 12553
   
17200
   
17200
   
0
   
 
Jacqueline Rumsey
P. O. Box 4101
New Windsor, NY 12553
   
6120
   
6120
   
0
   
 
 
32


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Joann Schmidt IRA
162 Shadblow Lane
Clinton Cors, NY 12514
   
1000
   
1000
   
0
   
 
Joann Schmidt IRA
162 Shadblow Lane
Clinton Cors, NY 12514
   
4500
   
4500
   
0
   
 
J. David Schmidt IRA
162 Shadblow Lane
Clinton Cors, NY 12514
   
1380
   
1380
   
0
   
 
J. David Schmidt
162 Shadblow Lane
Clinton Cors, NY 12514
   
7800
   
7800
   
0
   
 
Harriet Schneider IRA
4646 Willis Avenue, #303
Sherman Oaks, CA 91403
   
7600
   
7600
   
0
   
 
Harriet Schneider, Trustee
Harriet Schneider Rev Tr
4646 Willis Avenue, #303
Sherman Oaks, CA 91403
   
4400
   
4400
   
0
   
 
Sobel Marmor Fisher FBO Sobel
5 HV Prof Plaza
Newburgh, NY 12550
   
1440
   
1440
   
0
   
 
Sobel Marmor Fisher FBO Sobel
5 HV Prof Plaza
Newburgh, NY 12550
   
3370
   
3370
   
0
   
 
Betty Lou Straus, Trustee
Betty Lou Straus Rev Tr.
4646 Willis Avenue, #303
Sherman Oaks, CA 91403
   
2900
   
2900
   
0
   
 
Betty Lou Straus IRA
4646 Willis Avenue, #303
Sherman Oaks, CA 91403
   
970
   
970
   
0
   
 
Anthony Tardio, Trustee
Tardio PC Retirement Tr
15 Fulton Avenue
Poughkeepsie, NY 12603
   
500
   
500
   
0
   
 
Anthony Tardio, Trustee
Tardio Retirement Trust
28 Military Lane
Gardiner, NY 12525
   
3000
   
3000
   
0
   
 
Anthony Tardio
28 Military Lane
Gardiner, NY 12525
   
4700
   
4700
   
0
   
 
 
33


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Anthony Tardio IRA
28 Military Lane
Gardiner, NY 12525
   
1000
   
1000
   
0
   
 
Steven Tarshis, Trustee
Tarshis, Catania, Liberth, Mahon & Milligram PLLC PSP
P. O. Box 1479
Newburgh, NY 12551
   
11300
   
11300
   
0
   
 
William Timmons IRA
12 Watson Place
Hyde Park, NY 12538
   
1970
   
1970
   
0
   
 
Loretta Timmons
12 Watson Place
Hyde Park, NY 12538
   
1320
   
1320
   
0
   
 
Ian & Vickie Vander Essen
3116 Route 9W
New Windsor, NY 12553
   
1980
   
1980
   
0
   
 
Sallie VanItallie
1678 Jose Gaspar Drive
P. O. Box 775
Boca Grande, FL 33921
   
3000
   
3000
   
0
   
 
Edward & Pamela Weeks
158 Lily Lake Road
Highland, NY 12528
   
320
   
320
   
0
   
 
Edward Weeks IRA
158 Lily Lake Road
Highland, NY 12528
   
1600
   
1600
   
0
   
 
Matthew Weir
4948 Eskridge Terrace
Washington, DC 20016
   
500
   
500
   
0
   
 
Oscar Weiss
13 Jonathan Lane
Poughkeepsie, NY 12603
   
1970
   
1970
   
0
   
 
Ted & Ted A. Petrillo, Trustees
Westage Management PSP
200 Westage Bus Ctr Drive
Fishkill, NY 12524
   
500
   
500
   
0
   
 
Jerome Wittner IRA
5 Catalpa Road
Newburgh, NY 12550
   
8500
   
8500
   
0
   
 
Susan Najork
770 River Road
Newburgh, NY 12550
   
5860
   
5860
   
0
   
 
 
34


Name and Address
 
Number of
Common Shares
Beneficially
Owned Before
this Offering
 
Number of
Common Shares
Being Offered
For Sale in this
Offering
 
Number of
Common Shares
Beneficially
Owned After
this Offering
 
Percentage
Beneficially
Owned After
this Offering
 
Susan Najork IRA
770 River Road
Newburgh, NY 12550
   
5960
   
5960
   
0
   
 
Jane M. Heisler
200 Main Street
Southampton, NJ 08088
   
700
   
700
   
0
   
 
Robert Heisler IRA
200 Main Street
Southampton, NJ 08088
   
5530
   
5530
   
0
   
 
Michael & Cipora Levine
13 Ackerman Court
Croton Hdsn, NY 10520
   
2030
   
2030
   
0
   
 
Robert & Kathy Baruch
10402 Queensway Drive
Ellicott City, MD 21042
   
5300
   
5300
   
0
   
 
B. Holt Thrasher & Juliet Tammenoms Bakker
27 Mooreland Road
Greenwich, CT 06831
   
5700
   
5700
   
0
   
 
B. Holt Thrasher IRA
27 Mooreland Road
Greenwich, CT 06831
   
1870
   
1870
   
0
   
 
Joseph Wassi
103 Overlook Avenue
Beacon, NY 12508
   
2000
   
2000
   
0
   
 
Charles Greiner, Trustee
Charles Greiner Trust
922 Barton Woods Road
Atlanta, GA 30307
   
200