UNIT PURCHASE OPTION CLARIFICATION AGREEMENT

 
This Unit Purchase Option Clarification Agreement (this “Agreement”), dated
August 10, 2006, is to amend the Unit Purchase Option, dated as of January 30,
2006 (the “Option”), issued by Argyle Security Acquisition Corporation, a
Delaware corporation, with offices at 200 Concord Plaza, Suite 700, San Antonio,
Texas 78216 (“Company”), to Rodman & Renshaw, LLC, with offices at 1270 Avenue
of the Americas, New York, New York (“Option Holder”).
 
WHEREAS, as a result of certain questions that have arisen regarding the
accounting treatment applicable to the Option, the parties hereto deem it
necessary and desirable to amend the Option to clarify that the Option Holder
does not have the right to receive a net cash settlement in the event the
Company does not maintain a current prospectus relating to the units, common
stock and warrants issuable upon exercise of the Option at the time such Option
is exercisable.
 
NOW, THEREFORE, in consideration of the mutual agreements contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound hereby, the parties
hereto agree to amend the Option as set forth herein.
 
1.  Option. The undersigned hereby agree that the Option is hereby amended by
adding the following as Section 2.1.1 to the Option:

“2.1.1 No Exercise of Purchase Option if a Registration Statement is not
Effective. Notwithstanding anything herein to the contrary, the Company shall
not be obligated to deliver any securities pursuant to the exercise of this
Purchase Option unless (i) a registration statement under the Act with respect
to the Units, Warrants and Common Stock issuable upon such exercise is
effective, or (ii) in the opinion of counsel to the Company or counsel to the
Holder reasonably satisfactory to the Company, the exercise of this Purchase
Option is exempt from the registration requirements of the Act and such
securities are qualified for sale or exempt from qualification under applicable
securities laws of the states or other jurisdictions in which the registered
holders reside. This Purchase Option may not be exercised by, or securities
issued to, any registered holder in any state in which such exercise or issuance
would be unlawful. In no event will the Holder be entitled to receive a net-cash
settlement or other consideration in lieu of physical settlement in securities
if the securities underlying this Purchase Option is not covered by an effective
registration statement.”
 
2.  Miscellaneous.
 
a.  Governing Law; Jurisdiction. The validity, interpretation, and performance
of this Agreement shall be governed in all respects by the laws of the State of
New York, without giving effect to conflict of laws. The Company hereby agrees
that any action, proceeding or claim against it arising out of or relating in
any way to this Agreement shall be brought and enforced in the courts of the
State of New York or the United States District Court for the Southern District
of New York, and irrevocably submits to such jurisdiction, which jurisdiction
shall be exclusive. The Company hereby waives any objection to such exclusive
jurisdiction and that such courts represent an inconvenient forum. Any such
process or summons to be served upon the Company may be served by transmitting a
copy thereof by registered or certified mail, return receipt requested, postage
prepaid, addressed to it in care of the address set forth above or such other
address as the undersigned shall furnish in writing to the other. Such mailing
shall be deemed personal service and shall be legal and binding upon the Company
in any action, proceeding or claim.
 
 
 

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b.  Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and to their respective heirs, legal
representatives, successors and assigns.
 
c.  Entire Agreement. This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter thereof and merges
and supersedes all prior discussions, agreements and understandings of any and
every nature among them. Except as set forth in this Agreement, provisions of
the original Option which are not inconsistent with this Agreement shall remain
in full force and effect. This Agreement may be executed in counterparts.
 
d.  Severability. This Agreement shall be deemed severable, and the invalidity
or unenforceability of any term or provision hereof shall not affect the
validity or enforceability of this Agreement or of any other term or provision
hereof. Furthermore, in lieu of any such invalid or unenforceable term or
provision, the parties hereto intend that there shall be added as a part of this
Agreement a provision as similar in terms to such invalid or unenforceable
provision as may be possible and be valid and enforceable

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IN WITNESS WHEREOF, the parties hereto have executed this Unit Purchase Option
Clarification Agreement as of the date first written above.
 
 

       
ARGYLE SECURITY ACQUISTION CORPORATION
 
   
   
    By:   /s/ Ron Chaimovaki
 
Name:

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Ron Chaimovski
  
Title: Co-CEO and Vice Chairman

 

       
RODMAN & RENSHAW, LLC
 
   
   
    By:   /s/ John Borer
 
Name:

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John Borer
  
Title: President

 
 
 

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