▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLC
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
SELECTED DEALERS AGREEMENT
Dear Sirs:
1. Registration under the Securities Act of 1933, as amended (the " Act
"), of the 12,500,000 Units* of Argyle Security Acquisition Corporation (the "
Company "), as more fully described in the Preliminary Prospectus, dated , 2005,
and in the final prospectus (the " Prospectus ") which will be forwarded to you,
will become effective in the near future. We, as the Underwriters, are offering
certain of the Units for purchase by a selected group of dealers (the " Selected
Dealers ") on the terms and conditions stated herein.
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* Plus the over-allotment option available to the Underwriter to purchase up to
an additional 625,000 Units.
Authorized Public Offering Price: $8.00 per Unit.
Dealers' Selling Concession: Not to exceed $0.__ per
Unit payable upon termination of this
Agreement, except as provided below. We
reserve the right not to pay such concession
on any of the Units purchased by any of the
Selected Dealers from us and repurchased by
us at or below the price stated above prior
to such termination.
Reallowance: You may reallow not in excess of $0.__ per
Unit as a selling concession to dealers who
are members in good standing of the National
Association of Securities Dealers, Inc. (the
" NASD ") or to foreign dealers who are not
eligible for membership in the NASD and who
have agreed: (i) not to sell the Units
within the United States of America, its
territories or possessions or to persons who
are citizens thereof or residents therein;
and (ii) to abide by the applicable Conduct
Rules of the NASD.
Delivery and Payment: Delivery of the Units shall be made on or
about _____________, 2005 or such later date
as we may advise on not less than one day's
notice to you, at the office of ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇, LLC, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇ or at such other place as we shall
specify on not less than one day's notice to
you. Payment for the Units is to be made,
against delivery, at the authorized public
offering price stated above, or, if we shall
so advise you, at the authorized public
offering price less the dealers' selling
concession stated above, by a certified or
official bank check in New York Clearing
House Funds payable to the order of ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇, LLC.
Termination: This Agreement shall terminate at the close
of business on the 45th day following the
effective date of the Registration Statement
(of which the enclosed Prospectus forms a
part), unless extended at our discretion for
a period or periods not to exceed in the
aggregate 30 additional days. We may
terminate this Agreement, whether or not
extended, at any time without notice.
2. Any of the Units purchased by you hereunder are to be offered by you to
the public at the public offering price, except as herein otherwise provided and
except that a reallowance from such public offering price not in excess of the
amount set forth on the first page of this Agreement may be allowed as
consideration for services rendered in distribution to dealers that: (a) are
actually engaged in the investment banking or securities business; (b) execute
the written agreement prescribed by Rule 2740 of the NASD Conduct Rules; and (c)
are either members in good standing of the NASD or foreign banks, dealers or
institutions not eligible for membership in the NASD that represent to you that
they will promptly reoffer such Units at the public offering price and will
abide by the conditions with respect to foreign banks, dealers and institutions
set forth in paragraph 9 below.
3. You, by becoming a member of the Selected Dealers, agree: (a) upon
effectiveness of the Registration Statement and your receipt of the Prospectus,
to take up and pay for the number of Units allotted and confirmed to you; (b)
not to use any of the Units to reduce or cover any short position you may have;
(c) upon our request, to advise us of the number of Units purchased from us as
manager of the Selected Dealers remaining unsold by you and to resell to us any
or all of such unsold Units at the public offering price stated above, less all
or such part of the concession allowed you as we may determine; and (d) to make
available a copy of the Prospectus to all persons who on your behalf will
solicit orders for the Units prior to the making of such solicitations by such
persons. You are not authorized to give any information or to make any
representations other than those contained in the Prospectus or any supplements
or amendments thereto.
4. As contemplated by Rule 15c2-8 under the Securities Exchange Act of
1934, as amended, we agree to mail a copy of the Prospectus to any person making
a written request therefor during the period referred to in the rules and
regulations adopted under such Act, the mailing to be made to the address given
in the request. You confirm that you have delivered all preliminary prospectuses
and revised preliminary prospectuses, if any, required to be delivered under the
provisions of Rule 15c2-8 and agree to deliver all copies of the Prospectus
required to be delivered thereunder. We have heretofore delivered to you such
preliminary prospectuses as have been required by you, receipt of which is
hereby acknowledged, and will deliver such further prospectuses as may be
requested by you.
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5. You agree that until termination of this Agreement you will not make
purchases or sales of the Units except: (a) pursuant to this Agreement; (b)
pursuant to authorization received from us; or (c) in the ordinary course of
business as broker or agent for a customer pursuant to any unsolicited order.
6. Additional copies of the Prospectus and any supplements or amendments
thereto shall be supplied in reasonable quantity upon request.
7. The Units are offered by us for delivery when, as and if sold to, and
accepted by, us and subject to the terms herein and in the Prospectus or any
supplements or amendments thereto, to our right to vary the concessions and
terms of offering after their release for public sale, to approval of counsel as
to legal matters and to withdrawal, cancellation or modification of the offer
without notice.
8. Upon written application to us, you shall be informed as to the
jurisdictions under the securities or blue sky laws of which we believe the
Units are eligible for sale, but we assume no responsibility as to such
eligibility or the right of any member of the Selected Dealers to sell any of
the Units in any jurisdiction. We have caused to be filed a Further State Notice
relating to such of the Units to be offered to the public in New York in the
form required by, and pursuant to, the provisions of Article 23A of the General
Business Law of the State of New York. Upon the completion of the public
offering contemplated herein, each member of the Selected Dealers agrees to
promptly furnish to us, upon our request, territorial distribution reports
setting forth each jurisdiction in which sales of the Units were made by such
member, the number of Units sold in such jurisdiction, and any further
information as we may request, in order to permit us to file on a timely basis
any report that we as the Underwriters of the offering or manager of the
Selected Dealers may be required to file pursuant to the securities or blue sky
laws of any jurisdiction.
9. You, by becoming a member of the Selected Dealers, represent that you
actually engaged in the investment banking or securities business and that you
are: (a) a member in good standing of the NASD and will comply with Rule 2740
NASD's Conduct Rules; or (b) a foreign dealer or institution that is not
eligible for membership in the NASD and that has agreed (i) not to sell Units
within the United States of America, its territories or possessions or to
persons who are citizens thereof or residents therein, (ii) that any and all
sales shall be in compliance with Rule 2110-01 of the NASD's Conduct Rules,
(iii) to comply, as though it were a member of the NASD, with Rules 2730, 2740
and 2750 of the NASD's Conduct Rules, and to comply with Rule 2420 thereof as
that Rule applies to a non-member broker or dealer in a foreign country.
10. Nothing herein shall constitute any members of the Selected Dealers'
partners with us or with each other, but you agree, notwithstanding any prior
settlement of accounts or termination of this Agreement, to bear your proper
proportion of any tax or other liability based upon the claim that the Selected
Dealers constitute a partnership, association, unincorporated business or other
separate entity and a like share of any expenses of resisting any such claim.
11. ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLC shall be the Managing Underwriter of the
offering and manager of the Selected Dealers and shall have full authority to
take such action as we may deem advisable in respect of all matters pertaining
to the offering or the Selected Dealers or any members of them. Except as
expressly stated herein, or as may arise under the Act, we shall be under no
liability to any member of the Selected Dealers as such for, or in respect of:
(i) the validity or value of the Units; (ii) the form of, or the statements
contained in, the Prospectus, the Registration Statement of which the Prospectus
forms a part, any supplements or amendments to the Prospectus or such
Registration Statement, any preliminary prospectus, any instruments executed by,
or obtained or any supplemental sales data or other letters from, the Company,
or others; (iii) the form or validity of the Underwriting Agreement or this
Agreement; (iv) the eligibility of any of the Units for sale under the laws of
any jurisdiction; (v) the delivery of the Units; (vi) the performance by the
Company, or others of any agreement on its or their part; or (vii) any matter in
connection with any of the foregoing, except our own want of good faith.
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12. If for federal income tax purposes the Selected Dealers, among
themselves or with the Underwriters, should be deemed to constitute a
partnership, then we elect to be excluded from the application of Subchapter K,
Chapter 1, Subtitle A of the Internal Revenue Code of 1986, as amended, and we
agree not to take any position inconsistent with such selection. We authorize
you, in your discretion, to execute and file on our behalf such evidence of such
election as may be required by the Internal Revenue Service.
13. All communications from you shall be addressed to ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇,
LLC, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇, Attention: __________________. Any notice
from us to you shall be deemed to have been fully authorized by the Underwriters
and to have been duly given if mailed, telegraphed or sent by confirmed
facsimile transmittal to you at the address to which this letter is mailed. This
Agreement shall be construed in accordance with the laws of the State of New
York without giving effect to conflict of laws. Time is of the essence in this
Agreement.
If you desire to become a member of the Selected Dealers, please advise us
to that effect immediately by facsimile transmission and sign and return to us
the enclosed counterpart of this letter.
Very truly yours,
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLC
By:
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We accept membership in the Selected Dealers on the terms specified above.
Dated:______________________, 2005
(Selected Dealer)
By:
Name:
Title:
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