I:\ADVANCE\ALARM\MAIN\REGRIGHT.006
                               14
3/31/98 09:18



                 REGISTRATION RIGHTS AGREEMENT


          REGISTRATION RIGHTS AGREEMENT (this "Agreement")  dated
as  of  February  2, 1998, between Alarmguard Holdings,  Inc.,  a
Delaware  corporation (the "Company"), and the Purchasers  listed
on  Schedule  I hereto (each a "Purchaser" and collectively,  the
"Purchasers").


                           RECITALS:

          (a)  The Purchasers and the Company have entered into a
Preferred  Stock Purchase Agreement, dated as of the date  hereof
(the  "Stock  Purchase  Agreement") (each capitalized  term  used
herein  and not otherwise defined shall have the meaning ascribed
to  such term in the Stock Purchase Agreement), pursuant to which
the  Purchasers  are  simultaneously with  the  execution  hereof
purchasing  from  the Company the number of shares  of  Series  A
Preferred or Series B Preferred (collectively referred to  herein
as  the "Preferred Shares") of the Company set forth opposite its
name  on Schedule I hereto except that Advance will purchase  the
Preferred Shares to be purchased by it as of the Advance  Closing
Date.

          (b)   As  of  the  date  hereof, the  Preferred  Shares
purchased  by  the  Purchasers pursuant  to  the  Stock  Purchase
Agreement  entitles  the  holder thereof  to  receive,  upon  the
conversion thereof, the number of shares of Common Stock  as  are
set forth opposite its name on Schedule I, which number of shares
are  subject to adjustment as set forth in the provisions of  the
Certificate  of  Amendment  to the Second  Amended  and  Restated
Certificate    of     Incorporation    (the    "Certificate    of
Incorporation").

          (c)   The  Company  desires  to  grant  the  Purchasers
certain registration rights with respect to the Common Stock.

          NOW,   THEREFORE,  in  consideration  of   the   mutual
covenants herein contained, the parties hereto agree as follows:

          1.   Demand Registrations.

          (a)   Requests for Registration.  Subject to  paragraph
1(b)  below,  the  holders at any time of at  least  50%  of  the
Registrable Securities may request at any time registration under
the Securities Act of 1933, as amended (the "Securities Act"), of
all  or  part of their Registrable Securities on Form S-1 or  any
similar  long-form registration ("Long-Form Registrations"),  and
each  holder  of Registrable Securities may request  registration
under  the  Securities  Act of all or part of  their  Registrable
Securities   on  Form  S-2  or  S-3  or  any  similar  short-form
registration  ("Short-Form  Registrations")  if  available.  Each
request  for  a Demand Registration shall specify the approximate
number  of Registrable Securities requested to be registered  and
the  anticipated per share price range for such offering.  Within
ten days after receipt of any such request, the Company will give
written  notice  of  such  requested registration  to  all  other
holders  of  Registrable  Securities and  will  include  in  such
registration all Registrable Securities with respect to which the
Company  has  received  written requests  for  inclusion  therein
within  15  days after the receipt of the Company's notice.   All
registrations  requested  pursuant to  this  paragraph  1(a)  are
referred to herein as "Demand Registrations".

          (b)   Long-Form  Registrations.  Subject  to  paragraph
1(a),  the holders of Registrable Securities will be entitled  at
any time to request Long-Form Registrations in which (subject  to
Section  5(b))  the  Company will pay all  Registration  Expenses
("Company-paid  Long-Form  Registrations");  provided  that   the
holders  of Registrable Securities may not request more than  two
(2)   Long-Form   Registrations   (each   a   "Demand   Long-Form
Registration,"  and  each of which shall be a Company-paid  Long-
Form  Registration), such number to be reduced by the  number  of
previously   consummated  Demand  Long-Form   Registrations.    A
registration  will  not  count as one  of  the  permitted  Demand
Long-Form  Registrations until it has become  effective,  and  no
Company-paid  Long-Form Registration will count  as  one  of  the
permitted  Demand Long-Form Registrations unless the  holders  of
Registrable Securities are able to register and sell at least 85%
of  the  Registrable Securities requested to be included in  such
registration; provided that in any event the Company will pay all
Registration  Expenses in connection with any registration  initi
ated  as a Company-paid Long-Form Registration whether or not  it
has become effective.

          (c)   Short-Form  Registrations.  In  addition  to  the
Long-Form Registrations provided pursuant to paragraph 1(b), each
holder  of  Registrable Securities will be entitled to request  a
Short  Form  Registration (provided that  the  holders  may  only
request  up  to two (2) Short-Form Registrations in  any  twelve-
month  period,  which number shall be reduced by  the  number  of
previously  consummated Demand Short-Form Registrations  in  such
twelve-month   period)  in  which  the  Company  will   pay   all
Registration  Expenses.  Demand Registrations will be  Short-Form
Registrations  whenever  the Company  is  permitted  to  use  any
applicable short form.  The Company will use its best efforts  to
make  Short-Form Registrations on Form S-3 available for the sale
of Registrable Securities.  The holders of Registrable Securities
agree  that  they will not request a Long-Form Registration  when
the  Company  is  eligible  to  use  a  Short-Form  Registration;
provided  that  the Company agrees to include in  the  prospectus
included  in any Short-Form Registration Statement, such material
describing  the Company and intended to facilitate  the  sale  of
securities  being  so registered as is reasonably  requested  for
inclusion  therein by any of the shareholders selling  securities
pursuant to such registration statement, whether or not the  form
used  for  such registration statement requires the inclusion  of
such information.

          (d)   Priority  on Demand Registrations.   The  Company
will  not include in any Demand Registration any securities which
are  not Registrable Securities without the prior written consent
of  the  holders of at least 50.1% of the Registrable  Securities
included  in such registration.  If a Demand Registration  is  an
underwritten  offering and the managing underwriters  advise  the
Company  in writing that in their opinion the number of  Registra
ble  Securities  and,  if permitted hereunder,  other  securities
requested  to be included in such offering exceeds the number  of
Registrable Securities and other securities, if any, which can be
sold therein without adversely affecting the marketability of the
offering, the Company will include in such registration prior  to
the  inclusion  of  any  securities  which  are  not  Registrable
Securities the number of Registrable Securities requested  to  be
included  which in the opinion of such underwriters can  be  sold
without  adversely affecting the marketability of  the  offering,
pro rata among the respective holders thereof on the basis of the
number   of   Registrable  Securities  owned   by   each   holder
participating in such offering.

          (e)  Restrictions on Long-Form Registrations and Demand
Registrations.  The Company will not be obligated to  effect  any
Demand Long-Form Registration during the period starting with the
date  thirty (30) days prior to the Company's good faith estimate
of  the  date of filing of, and ending on a date one hundred  and
twenty  (120)  days  after  the effective  date  of,  a  Company-
initiated  registration; provided that the  Company  is  actively
employing  in  good faith all reasonable efforts  to  cause  such
registration  statement  to  become and  remain  effective.   The
Company  will  not  be obligated to effect any  Demand  Long-Form
Registration within six (6) months after the effective date of  a
previous Long-Form Registration.  The Company may postpone for up
to  six  (6)  months  the  filing  or  the  effectiveness  of   a
registration statement for a Demand Registration if  the  Company
and  the holders of at least 66.67% of the Registrable Securities
to  be  covered thereby agree that such Demand Registration would
reasonably be expected to have an adverse effect on any  proposal
or  plan  by the Company or any of its subsidiaries to engage  in
any  acquisition of assets (other than in the ordinary course  of
business)  or any merger, consolidation, tender offer or  similar
transaction;  provided  that  in  such  event,  the  holders   of
Registrable  Securities initially requesting  such  Demand  Regis
tration will be entitled to withdraw such request and such Demand
Registration  will  not  count as one  of  the  permitted  Demand
Registrations hereunder and the Company will pay all Registration
Expenses in connection with such registration.  The Company  will
not  be  obligated  to  effect any Demand Long-Form  Registration
unless   the  anticipated  aggregate  offering  price,   net   of
underwriting discounts and commissions, of the Common Stock to be
included  in such Demand Long-Form Registration equals more  than
ten million dollars ($10,000,000).

          (f)  Other Registration Rights.  Except as provided  in
this  Agreement, the Company shall not grant to any  Persons  the
right to request the Company to register any equity securities of
the  Company, or any securities convertible or exchangeable  into
or  exercisable  for such securities, without the  prior  written
consent  of  the  holders of at least 66.67% of  the  Registrable
Securities;  provided that the Company may  grant  rights  to  em
ployees  of  the  Company and its Subsidiaries to participate  in
Piggyback Registrations so long as such rights are subordinate to
the  rights of the holders of Registrable Securities with respect
to  such  Piggyback Registrations as provided in paragraphs  2(c)
and 2(d) below.

          (g)    Selections  of  Underwriters.   If  any   Demand
Registration  is an underwritten offering, the selection  by  the
Company  of investment banker(s) and manager(s) for the  Offering
must  be approved by the holders of a majority of the Registrable
Securities  included in such Demand Registration.  Such  approval
will not be unreasonably withheld.

          2.   Piggyback Registrations.

          (a)  Right to Piggyback.  Whenever the Company proposes
to register any of its securities under the Securities Act (other
than  pursuant to (i) a Demand Registration, (ii) a  registration
in  connection  with shares issued by the Company  in  connection
with  the  acquisition  of any company or companies  or  (iii)  a
registration solely of shares that have been issued  pursuant  to
the  Company's employee benefit plans) and the registration  form
to  be  used  may  be  used for the registration  of  Registrable
Securities  (a "Piggyback Registration"), the Company  will  give
prompt written notice to all holders of Registrable Securities of
its  intention to effect such a registration and will include  in
such  registration  all Registrable Securities  with  respect  to
which  the  Company has received written requests  for  inclusion
therein within 15 days after the receipt of the Company's notice.

          (b)   Piggyback Expenses.  Subject to Section 5(b), the
Registration  Expenses  of the holders of Registrable  Securities
will be paid by the Company in all Piggyback Registrations.

          (c)  Priority on Primary Registrations.  If a Piggyback
Registration is an underwritten primary registration on behalf of
the Company, and the managing underwriters advise the Company  in
writing  that in their opinion the number of securities requested
to  be included in such registration exceeds the number which can
be   sold  in  such  offering  without  adversely  affecting  the
marketability of the offering, the Company will include  in  such
registration  (i) first, the securities the Company  proposes  to
sell,  (ii) second,  the Registrable Securities requested  to  be
included in such registration, pro rata among the holders of such
Registrable  Securities on the basis of the number of Registrable
Securities   owned  by  each  holder  of  Registrable  Securities
participating in such offering, and (iii) third, other securities
requested to be included in such registration; provided  that  in
any event the holders of Registrable Securities shall be entitled
to  register at least 20% of the securities to be included in any
such registration.

          (d)    Priority  on  Secondary  Registrations.   If   a
Piggyback  Registration is an underwritten secondary registration
on  behalf  of  holders  of  the Company's  securities,  and  the
managing underwriters advise the Company in writing that in their
opinion the number of securities requested to be included in such
registration  exceeds  the  number which  can  be  sold  in  such
offering  without  adversely affecting the marketability  of  the
offering,   the   Company  will  include  in  such   registration
(i) first, the Registrable Securities requested to be included in
such registration, pro rata among the holders of such Registrable
Securities  on the basis of the number of Registrable  Securities
owned  by each holder of Registrable Securities participating  in
such  offering, and (ii) second other securities requested to  be
included in such registration.

          (e)   Selection  of  Underwriters.   If  any  Piggyback
Registration  is an underwritten offering, the selection  by  the
Company  of investment banker(s) and manager(s) for the  offering
must  be approved by the holders of a majority of the Registrable
Securities   included  in  such  Piggyback  Registration.    Such
approval will not be unreasonably withheld.
          (f)    Other   Registrations.   If  the   Company   has
previously  filed  a  registration  statement  with  respect   to
Registrable  Securities pursuant to Paragraph 1  or  pursuant  to
this  Paragraph 3, and if such previous registration has not been
withdrawn or abandoned, the Company will not file or cause to  be
effected  any other registration of any of its equity  securities
or securities convertible or exchangeable into or exercisable for
its  equity  securities  under  the  Securities  Act  (except  on
Form S-8 or any successor form), whether on its own behalf or  at
the request of any holder or holders of such securities, until  a
period of at least six months has elapsed from the effective date
of such previous registration.

          3.   Holdback Agreements.

          (a)   Each holder of Registrable Securities agrees  not
to  effect  any  public  sale  or distribution  (including  sales
pursuant to Rule 144) of equity securities of the Company, or any
securities  convertible into or exchangeable or  exercisable  for
such  securities, during the seven days prior to and  the  ninety
(90)-day   period  beginning  on  the  effective  date   of   any
underwritten  Demand  Registration or any underwritten  Piggyback
Registration in which Registrable Securities are included (except
as   part   of   such  underwritten  registration),  unless   the
underwriters  managing the registered public  offering  otherwise
agree.

          (b)   The  Company agrees (i) not to effect any  public
sale  or distribution of its equity securities, or any securities
convertible  into or exchangeable or exercisable for such  securi
ties,  during  the  seven days prior to  and  during  the  ninety
(90)-day   period  beginning  on  the  effective  date   of   any
underwritten  Demand  Registration or any underwritten  Piggyback
Registration (except as part of such underwritten registration or
pursuant  to  registrations on Form S-8 or any  successor  form),
unless  the underwriters managing the registered public  offering
otherwise agree, and (ii) to cause each holder of at least 5% (on
a  fully-diluted  basis) of its Common Stock, or  any  securities
convertible into or exchangeable or exercisable for Common Stock,
purchased  from the Company at any time after the  date  of  this
Agreement (other than in a registered public offering)  to  agree
not  to  effect any public sale or distribution (including  sales
pursuant  to Rule 144) of any such securities during such  period
(except  as part of such underwritten registration, if  otherwise
permitted),  unless  the  underwriters  managing  the  registered
public offering otherwise agree.

          4.    Registration Procedures.  Whenever the holders of
Registrable   Securities  have  requested  that  any  Registrable
Securities be registered pursuant to this Agreement, the  Company
will use its best efforts to effect the registration and the sale
of  such  Registrable Securities in accordance with the  intended
method  of  disposition  thereof including  the  registration  of
common  stock  that may be obtained upon conversion of  Preferred
Shares  held  by  a  holder of Registrable Securities  requesting
registration  as  to  which the Company has  received  reasonable
assurances  that only Registrable Securities will be  distributed
to   the  public,  and  pursuant  thereto  the  Company  will  as
expeditiously as possible:

          (a)   prepare  and  file  (in  the  case  of  a  Demand
Registration  not  more  than  sixty  (60)  days  after   request
therefor)   with  the  Securities  and  Exchange   Commission   a
registration   statement  with  respect   to   such   Registrable
Securities  and  use its best efforts to cause such  registration
statement to become effective (provided that as far in advance as
practicable before filing a registration statement or  prospectus
or  any  amendments  or  supplements thereto,  the  Company  will
furnish  to the counsel selected by the holders of a majority  of
the Registrable Securities covered by such registration statement
copies  of  all  such  documents  proposed  to  be  filed,  which
documents will be subject to the review of such counsel);

          (b)   prepare and file with the Securities and Exchange
Commission  such amendments and supplements to such  registration
statement and the prospectus used in connection therewith as  may
be necessary to keep such registration statement effective for  a
period  of  not  less  than one hundred  and  eighty  (180)  days
(subject  to Paragraph (a) above) and comply with the  provisions
of  the  Securities  Act with respect to the disposition  of  all
securities  covered  by such registration statement  during  such
period in accordance with the intended methods of disposition  by
the sellers thereof set forth in such registration statement;

          (c)   furnish to each seller of Registrable  Securities
such  number  of  copies  of  such registration  statement,  each
amendment and supplement thereto, the prospectus included in such
registration  statement  (including each preliminary  prospectus)
and such other documents as such seller may reasonably request in
order to facilitate the disposition of the Registrable Securities
owned by such seller;

          (d)   use its best efforts to register or qualify  such
Registrable  Securities under such other securities or  blue  sky
laws of such jurisdictions as any seller reasonably requests  and
do  any  and  all other acts and things which may  be  reasonably
necessary  or  advisable to enable such seller to consummate  the
disposition  in such jurisdictions of the Registrable  Securities
owned  by  such  seller (provided that the Company  will  not  be
required  to  (i)  qualify  generally  to  do  business  in   any
jurisdiction where it would not otherwise be required to  qualify
but for this subparagraph, (ii) subject itself to taxation in any
such  jurisdiction or (iii) consent to general service of process
in any such jurisdiction);

          (e)  notify each seller of such Registrable Securities,
at  any time when a prospectus relating thereto is required to be
delivered under the Securities Act, of the happening of any event
as a result of which the prospectus included in such registration
statement  contains  an untrue statement of a  material  fact  or
omits  any  fact  necessary to make the  statements  therein  not
misleading,  and, at the request of any such seller, the  Company
will  prepare  a  supplement or amendment to such  prospectus  so
that,   as  thereafter  delivered  to  the  purchasers  of   such
Registrable  Securities,  such prospectus  will  not  contain  an
untrue  statement of a material fact or omit to  state  any  fact
necessary to make the statements therein not misleading;

          (f)  cause all such Registrable Securities to be listed
on each securities exchange on which similar securities issued by
the  Company are then listed and, if not so listed, to be  listed
on  the  National  Association  of Securities  Dealers  automated
quotation system;

          (g)   provide  a transfer agent and registrar  for  all
such Registrable Securities not later than the effective date  of
such registration statement;

          (h)   enter  into such customary agreements  (including
underwriting  agreements in customary form)  and  take  all  such
other  actions  as the holders of a majority of  the  Registrable
Securities  being  sold or the underwriters, if  any,  reasonably
request  in  order to expedite or facilitate the  disposition  of
such   Registrable  Securities  (including,  without  limitation,
effecting a stock split or a combination of shares);

          (i)   make  available for inspection by any  seller  of
Registrable  Securities,  any underwriter  participating  in  any
disposition  pursuant  to  such registration  statement  and  any
attorney,  accountant or other agent retained by any such  seller
or  underwriter,  all  financial  and  other  records,  pertinent
corporate documents and properties of the Company, and cause  the
Company's   officers,   directors,  employees   and   independent
accountants to supply all information reasonably requested by any
such  seller,  underwriter,  attorney,  accountant  or  agent  in
connection with such registration statement;

          (j)   permit any holder of Registrable Securities which
holder, in its sole and exclusive judgment, might be deemed to be
an underwriter or a controlling person of the Company, to partici
pate  in  the  preparation  of  such registration  or  comparable
statement  and  to  require the insertion  therein  of  material,
furnished  to  the  Company in writing, which in  the  reasonable
judgment of such holder and its counsel should be included;

          (k)   in  the  event of the issuance of any stop  order
suspending the effectiveness of a registration statement,  or  of
any  order  suspending  or preventing  the  use  of  any  related
prospectus  or suspending the qualification of any  common  stock
included  in  such  registration  statement  for  sale   in   any
jurisdiction,  the Company will promptly notify  the  holders  of
Registrable  Securities and will use its reasonable best  efforts
promptly to obtain the withdrawal of such order; and

          (l)   obtain  a cold comfort letter from the  Company's
independent  public accountants in customary  form  and  covering
such  matters  of  the type customarily covered by  cold  comfort
letters   as  the  holders  of  a  majority  of  the  Registrable
Securities being sold reasonably request; and

          (m)    in   connection  with  an  underwritten   public
offering,  (i) cooperate with the selling holders of  Registrable
Securities,  the underwriters participating in the  offering  and
their  counsel  in  any  due  diligence investigation  reasonably
requested   by  the  selling  holders  or  the  underwriters   in
connection   therewith  and  (ii)  participate,  to  the   extent
reasonably requested by the managing underwriter for the offering
or  the  selling  holder,  in efforts  to  sell  the  Registrable
Securities  under  the offering (including,  without  limitation,
participating in "roadshow" meetings with prospective  investors)
that  would be customary for underwritten primary offerings of  a
comparable amount of equity securities by the Company.

          5.   Registration Expenses.

          (a)  All expenses incident to the Company's performance
of   or   compliance  with  this  Agreement,  including   without
limitation all registration and filing fees, fees and expenses of
compliance  with securities or blue sky laws, printing  expenses,
messenger  and  delivery expenses, and fees and disbursements  of
counsel  for  the  Company and all independent  certified  public
accountants,  underwriters (excluding discounts and  commissions)
and  other  Persons  retained by the Company (all  such  expenses
being  herein called "Registration Expenses"), will be  borne  as
provided in this Agreement, except that the Company will, in  any
event,  pay its internal expenses (including, without limitation,
all  salaries and expenses of its officers and employees  perform
ing  legal or accounting duties), the expense of any annual audit
or  quarterly review, the expense of any liability insurance  and
the expenses and fees for listing the securities to be registered
on each securities exchange on which similar securities issued by
the  Company  are then listed or on the National  Association  of
Securities Dealers automated quotation system.  The Company shall
not  be required to pay an underwriting discount with respect  to
any  shares  being sold by any party other than  the  Company  in
connection  with an underwritten public offering of  any  of  the
Company's securities pursuant to this Agreement.

          (b)    In  connection  with  each  Company-paid  Demand
Registration,   the  Company  will  reimburse  the   holders   of
Registrable  Securities  covered by  such  registration  for  the
reasonable fees and expenses (including the fees and expenses  of
counsel  chosen  by the holders of a majority of the  Registrable
Securities  initially requesting such registration)  incurred  by
such holders in connection with such registration.  To the extent
that  there are any unreimbursed expenses incurred by the holders
of  Registrable Securities, each holder shall bear his or her pro
rata  share of such expenses based upon the number of  shares  of
Registrable  Securities held by such holder that are included  in
such  registration  relative to the  number  of  all  Registrable
Securities included in such registration.

          (c)    The  Company  will  reimburse  the  holders   of
Registrable  Securities  for  the reasonable  fees  and  expenses
(including the fees and expenses of counsel chosen by the holders
of  a  majority of the Registrable Securities) incurred  by  such
holders in enforcing any of their rights under this Agreement.

          6.   Indemnification.

          (a)   Indemnification  of Selling Stockholders  by  the
Company.  The Company agrees to indemnify and hold harmless  each
holder  of  Registrable Securities which are registered  pursuant
hereto  (each a "Selling Stockholder") and each person,  if  any,
who  controls  any  Selling Stockholder  within  the  meaning  of
Section  15 of the Securities Act or Section 20 of the Securities
Exchange  Act  of  1934,  as  amended (the  "Exchange  Act"),  as
follows:

          (i)  against any and all loss, liability, claim, damage
and  expense whatsoever, as incurred, arising out of  any  untrue
statement  or  alleged  untrue  statement  of  a  material   fact
contained   in  the  registration  statement  (or  any  amendment
thereto),  or  the omission or alleged omission  therefrom  of  a
material fact required to be stated therein or necessary to  make
the  statements  therein not misleading or  arising  out  of  any
untrue  statement or alleged untrue statement of a material  fact
contained in any preliminary prospectus or the prospectus (or any
amendment  or  supplement thereto), or the  omission  or  alleged
omission therefrom of a material fact necessary in order to  make
the  statements therein, in the light of the circumstances  under
which they were made, not misleading;

          (ii) against any and all loss, liability, claim, damage
and  expense  whatsoever,  as incurred,  to  the  extent  of  the
aggregate  amount  paid in settlement of any litigation,  or  any
investigation or proceeding by any governmental agency  or  body,
commenced  or threatened, or of any claim whatsoever  based  upon
any such untrue statement or omission, or any such alleged untrue
statement  or  omission; provided, that subject to  Section  6(c)
below  any  such  settlement is effected with the  prior  written
consent of the Company; and

          (iii)      against  any and all expense whatsoever,  as
incurred (including the fees and disbursements of counsel  chosen
by    such   Selling   Stockholder),   reasonably   incurred   in
investigating, preparing or defending against any litigation,  or
any  investigation  or proceeding by any governmental  agency  or
body, commenced or threatened, or any claim whatsoever based upon
any such untrue statement or omission, or any such alleged untrue
statement or omission, to the extent that any such expense is not
paid  under  (i)  or (ii) above;  provided, that  this  indemnity
agreement  shall not apply to any loss, liability, claim,  damage
or  expense to the extent arising out of any untrue statement  or
omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to  the
Company  by  the  Selling Stockholder expressly for  use  in  the
registration  statement  (or  any  amendment  thereto),  or   any
preliminary  prospectus or the prospectus (or  any  amendment  or
supplement thereto).

          (b)    Indemnification  of  Company  by   the   Selling
Stockholders.   Each  Selling  Stockholder,  severally  and   not
jointly,  agrees to indemnify and hold harmless the Company,  its
directors,  each  of  its  officers who signed  the  registration
statement  and  each  person, if any, who  controls  the  Company
within the meaning of Section 15 of the Securities Act or Section
20  of  the  Exchange Act, against any and all  loss,  liability,
claim, damage and expense described in the indemnity contained in
Section 6(a) above, as incurred, but only with respect to  untrue
or   alleged   untrue  statements  or  omissions  made   in   the
registration  statement  (or  any  amendment  thereto),  or   any
preliminary  prospectus or any prospectus (or  any  amendment  or
supplement  thereto)  in  reliance upon and  in  conformity  with
written  information furnished to the Company by or on behalf  of
such Selling Stockholder with respect to such Selling Stockholder
expressly for use in the registration statement (or any amendment
or supplement thereto); provided, that such Selling Stockholder's
aggregate liability under this Section 6 shall be limited  to  an
amount   equal   to  the  net  proceeds  (after   deducting   the
underwriting discount, but before deducting expenses) received by
such  Selling Stockholder from the sale of Registrable Securities
pursuant  to  a  registration statement filed  pursuant  to  this
Agreement.

          (c)    Actions  against  Parties;  Notification.   Each
indemnified  party  shall give notice as promptly  as  reasonably
practicable  to  each indemnifying party of any action  commenced
against it in respect of which indemnity may be sought hereunder,
but  failure to so notify an indemnifying party shall not relieve
such  indemnifying  party  from any liability  hereunder  to  the
extent it is not materially prejudiced as a result thereof and in
any  event shall not relieve it from any liability which  it  may
have  otherwise than on account of this indemnity agreement.   In
the case of parties indemnified pursuant to Section 6(a), counsel
to  the  indemnified  parties shall be selected  by  the  Selling
Stockholders (by majority vote based on the number of Registrable
Securities included in a registration hereunder) and, in the case
of  parties indemnified pursuant to Section 6(b), counsel to  the
indemnified  parties  shall  be  selected  by  the  Company.   An
indemnifying  party  may participate at its own  expense  in  the
defense  of  any  such  action; provided,  that  counsel  to  the
indemnifying  party  shall not (except with the  consent  of  the
indemnified party) also be counsel to the indemnified party.   In
no  event  shall the indemnifying parties be liable for fees  and
expenses  of  more  than one counsel (in addition  to  any  local
counsel)  separate  from their own counsel  for  all  indemnified
parties in connection with any one action or separate but similar
or  related actions in the same jurisdiction arising out  of  the
same general allegations or circumstances.  No indemnifying party
shall,  without  the  prior written consent  of  the  indemnified
parties,  settle  or compromise or consent to the  entry  of  any
judgment with respect to any litigation, or any investigation  or
proceeding  by  any  governmental agency or  body,  commenced  or
threatened,  or  any  claim  whatsoever  in  respect   of   which
indemnification  or  contribution  could  be  sought  under  this
Section  6 (whether or not the indemnified parties are actual  or
potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified
party   from  all  liability  arising  out  of  such  litigation,
investigation, proceeding or claim and (ii) does  not  include  a
statement  as  to  or  an admission of fault,  culpability  or  a
failure to act by or on behalf of any indemnified party.

          (d)    Settlement  without  Consent   if   Failure   to
Reimburse.   If  at  any  time an indemnified  party  shall  have
requested  an  indemnifying  party to reimburse  the  indemnified
party  for fees and expenses of counsel, such indemnifying  party
agrees  that it shall be liable for any settlement of the  nature
contemplated  by  Section 6(a)(ii) effected without  its  written
consent if (i) such settlement is entered into more than 45  days
after  receipt  by  such  indemnifying  party  of  the  aforesaid
request, (ii) such indemnifying party shall have received  notice
of  the  terms of such settlement at least 30 days prior to  such
settlement  being entered into and (iii) such indemnifying  party
shall  not  have reimbursed such indemnified party in  accordance
with such request prior to the date of such settlement.

          (e)  Contribution.  (i)  If a claim for indemnification
under Section 6(a) or 6(b) is unavailable to an indemnified party
because  of  a failure or refusal of a governmental authority  to
enforce  such  indemnification in accordance with its  terms  (by
reason  of  public  policy or otherwise), then each  indemnifying
party,  in  lieu  of indemnifying such indemnified  party,  shall
contribute  to  the  amount paid or payable by  such  indemnified
party  as  a  result  of such losses, in such  proportion  as  is
appropriate  to  reflect the relative fault of  the  indemnifying
party  and the indemnified party in connection with the  actions,
statements or omissions that resulted in such losses as  well  as
any  other relevant equitable considerations.  The relative fault
of  such  indemnifying  party  and  indemnified  party  shall  be
determined  by  reference  to, among other  things,  whether  any
action  in  question,  including any  untrue  or  alleged  untrue
statement of a material fact or omission or alleged omission of a
material  fact,  has  been  taken  or  made  by,  or  relates  to
information  supplied by, such indemnifying party or  indemnified
party,  and  the parties' relative intent, knowledge,  access  to
information  and opportunity to correct or prevent  such  action,
statement or omission.  The amount paid or payable by a party  as
a result of any losses shall be deemed to include, subject to the
limitations set forth in this Section, any reasonable  attorneys'
or  other  reasonable fees or expenses incurred by such party  in
connection  with  any proceeding to the extent such  party  would
have   been  indemnified  for  such  fees  or  expenses  if   the
indemnification  provided for in this Section  was  available  to
such party in accordance with its terms.

          (ii) The parties hereto agree that it would not be just
and equitable if contribution  pursuant to this Section 6(f) were
determined  by  pro  rata allocation or by any  other  method  of
allocation  that  does  not  take  into  account  the   equitable
considerations   referred   to  in  the   immediately   preceding
paragraph.  Notwithstanding the provisions of this Section  6(f),
a  holder  shall not be required to contribute, in the aggregate,
any amount in excess of the amount by which the proceeds actually
received  by  such  holder  from  the  sale  of  the  Registrable
Securities  subject to the proceeding exceeds the amount  of  any
damages  that the holder has otherwise been required  to  pay  by
reason of such untrue or alleged untrue statement or omission  or
alleged    omission.     No   Person   guilty    of    fraudulent
misrepresentation  (within the meaning of Section  11(f)  of  the
Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.

          (iii)      The  indemnity  and contribution  agreements
contained  in this Section are in addition to any liability  that
the indemnifying parties may have to the indemnified parties.

          7.    Participation in Underwritten Registrations.   No
Person  may  participate in any registration hereunder  which  is
underwritten unless such Person (a) agrees to sell such  Person's
securities on the basis provided in any underwriting arrangements
approved  by the Person or Persons entitled hereunder to  approve
such  arrangements  and (b) completes and executes  all  question
naires,  powers of attorney, indemnities, underwriting agreements
and other documents required under the terms of such underwriting
arrangements.

          8.   Definitions.

          "Common  Stock" means the Common Stock of the  Company,
par value $0.0001 per share.

          "Registrable  Securities" means (i)  any  Common  Stock
issued  upon the conversion  of any Preferred Shares  issued  pur
suant  to  the  Stock  Purchase Agreement   (whether  held  by  a
Purchaser  or  any  successor or assignee of  a  Purchaser),  and
(ii)  any  Common Stock issued or issuable with  respect  to  the
securities  referred to in clause (i) by way of a stock  dividend
or  stock  split or in connection with a combination  of  shares,
recapitalization, merger, consolidation or other  reorganization.
As to any particular Registrable Securities, such securities will
cease   to   be  Registrable  Securities  when  they  have   been
distributed  to  the  public pursuant to an  offering  registered
under  the Securities Act or sold to the public through a broker,
dealer  or  market maker in compliance with Rule  144  under  the
Securities Act (or any similar rule then in force).  For purposes
of  this  Agreement, a Person will be deemed to be  a  holder  of
Registrable  Securities whenever such Person  has  the  right  to
acquire directly or indirectly such Registrable Securities  (upon
conversion   or  exercise  in  connection  with  a  transfer   of
securities  or  otherwise, but disregarding any  restrictions  or
limitations upon the exercise of such right), whether or not such
acquisition   has  actually  been  effected.   For  purposes   of
calculating the percentage of Registrable Securities  for  voting
purposes,  the  Preferred Shares shall be  deemed  to  have  been
converted at the then applicable conversion price.

          "Registration Expenses" has the meaning  set  forth  in
Section 5(a) hereof.

          9.   Miscellaneous.

          (a)   No Inconsistent Agreements.  The Company has  not
entered  and  will  not hereafter enter into any  agreement  with
respect  to its securities which is inconsistent with or violates
the  rights  granted to the holders of Registrable Securities  in
this Agreement.

          (b)  Adjustments Affecting Registrable Securities.  The
Company will not take any action, or permit any change to  occur,
with  respect to its securities which would adversely affect  the
ability of the holders of Registrable Securities to include  such
Registrable  Securities in a registration undertaken pursuant  to
this  Agreement or which would adversely affect the marketability
of   such   Registrable  Securities  in  any  such   registration
(including,  without limitation, effecting a  stock  split  or  a
combination of shares).

          (c)   Remedies.   Any Person having  rights  under  any
provision  of  this Agreement will be entitled  to  enforce  such
rights  specifically to recover damages caused by reason  of  any
breach  of  any provision of this Agreement and to  exercise  all
other  rights  granted  by  law.  The parties  hereto  agree  and
acknowledge that money damages may not be an adequate remedy  for
any breach of the provisions of this Agreement and that any party
may in its sole discretion apply to any court of law or equity of
competent  jurisdiction  (without  posting  any  bond  or   other
security)  for  specific  performance and  for  other  injunctive
relief in order to enforce or prevent violation of the provisions
of this Agreement.

          (d)   Amendments  and  Waivers.   Except  as  otherwise
provided herein, the provisions of this Agreement may be  amended
or  waived only upon the prior written consent of the Company and
holders of at least 66.67% of the Registrable Securities.

          (e)   Successors and Assigns.  All covenants and  agree
ments  in  this Agreement by or on behalf of any of  the  parties
hereto  will  bind  and  inure to the benefit  of  the  permitted
respective  successors and assigns of the parties hereto  whether
so expressed or not.

          (f)   Notices.  Except as otherwise expressly  provided
herein,  any  and  all notices, designations,  consents,  offers,
acceptances or other communications provided for herein shall  be
given in writing and shall be mailed by first class registered or
certified  mail, postage prepaid, sent by a nationally recognized
overnight  courier  service  or  transmitted  via  telecopier  as
follows:

If to the Company:

                    Alarmguard Holdings, Inc.
                    125 Frontage Road
                    Orange, Connecticut  06477
                    Telecopy: (203) 799-9636
                    Attention:     Russell R. MacDonnell

     with a copy to:

                    Robinson & Cole LLP
                    695 East Main Street
                    Stamford, Connecticut  06904
                    Telecopy: (203) 462-7599
                    Attention:     Richard A. Krantz, Esq.

If to Advance:

                    Advance Capital Partners, L.P.
                    660 Madison Avenue
                    15th Floor
                    New York, New York 10021
                    Telecopy: (212) 835-2020
                    Attention:     Robert A. Bernstein

     with a copy to:

                    Kirkland & Ellis
                    153 East 53rd Street
                    New York, New York  10022
                    Telecopy: (212) 446-4900
                    Attention:     Joshua N. Korff, Esq.

If  to any other Purchaser to the address set forth opposite such
Purchaser's name on Schedule I hereto.

Notice shall be deemed given, for all purposes, when deposited in
the  United States mail as registered or certified mail, in which
event the fifth day following the date of postmark on the receipt
of such registered or certified mail shall conclusively be deemed
the  date  of  giving of such notice, on the first  Business  Day
following  collection by the courier service or when acknowledged
by the receiving telecopier.

          (g)   Interpretation of Agreement;  Severability.   The
provisions of this Agreement shall be applied and interpreted  in
a  manner  consistent  with each other so as  to  carry  out  the
purposes and intent of the parties hereto, but if for any  reason
any  provision  hereof  is  determined  to  be  unenforceable  or
invalid,  such  provision  or  such  part  thereof  as   may   be
unenforceable  or  invalid  shall  be  deemed  severed  from  the
Agreement and the remaining provisions carried out with the  same
force and effect as if the severed provision or part thereof  had
not been a part of this Agreement.

          (h)   GOVERNING LAW.  THIS AGREEMENT SHALL BE  GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL SUBSTANTIVE LAWS
(AND NOT THE CONFLICTS OF LAW) OF THE STATE OF NEW YORK.

          (i)   Counterparts.  This Agreement may be executed  in
one or more counterparts, each of which shall be deemed to be  an
original,  but  all of which taken together shall constitute  one
and the same Agreement.

          (j)   Entire Agreement.  This Agreement constitutes the
entire  agreement  of  the parties with respect  to  the  subject
matter hereof, and supersedes all previous agreements.

                    *     *     *     *    *

                    [SIGNATURE PAGES FOLLOW]
          IN  WITNESS  WHEREOF,  the  parties  hereto  have  duly
executed  and  delivered this Agreement  as  of  the  date  first
written above.


                               ALARMGUARD HOLDINGS, INC.


                               By:
                                   Name:
                                   Title:


                               ADVANCE CAPITAL PARTNERS, L.P.

                               By:   Advance  Capital Associates,
L.P.,
                                        its General Partner
                               By:Advance   Capital   Management,
                                   LLC,
                                        its General Partner


                               By:
                                   Name:     Robert A. Bernstein
                                   Title:    Principal


                               ADVANCE      CAPITAL      OFFSHORE
                               PARTNERS, L.P.

                               By:Advance     Capital    Offshore
                                   Associates, LDC,
                                        its General Partner
                               By:Advance   Capital   Associates,
                                   L.P.,
                                        its Sole Director
                               By:Advance   Capital   Management,
                                   LLC,
                                        its General Partner


                               By:
                                   Name:     Robert A. Bernstein
                                   Title:    Principal

                               CANAAN EQUITY, L.P.

                               By:    Canaan   Equity   Partners,
L.L.C.


                               By:
                                   Name:  Stephen L. Green
                                   Title:    Member/Manager



                               EXETER CAPITAL PARTNERS IV, L.P.

                               By:  Exeter IV Advisors, L.P.
                                        its General Partner
                               By:  Exeter IV Advisors, Inc.,
                                        its General Partner


                               By:
                                   Name:  Keith R. Fox
                                   Title:    President


                               LB I GROUP INC.


                               By:
                                   Name:  Alan H. Washkowitz
                                   Title:        Senior      Vice
President


                               ELLIOTT ASSOCIATES, L.P.





                               By:
                                   Name:  Paul E. Singer
                                   Title:    General Partner




                               WESTGATE INTERNATIONAL, L.P.
                                   By:    Martley  International,
Inc.
                                           as Attorney-in-Fact



                               By:
                                   Name:  Paul E. Singer
                                   Title:    President



                               ZIFF ASSET MANAGEMENT, L.P.





                               By:
                                   Name:  Philip B. Korsant
                                   Title:   President



                               OZ MASTER FUND, LTD.





                               By:
                                   Name:     Daniel S. Och
                                   Title:   Managing Member
                                        OZ Management, L.L.C.

                               IBJS CAPITAL CORPORATION





                               By:
                                   Name:  Kevin P. Falvey
                                   Title:    Director



                               CREDIT SUISSE (GUERNSEY) LIMITED
                                   as trustee of the Dynamic
Growth Fund II




                               By:
                                   Name: M.E. Zunino
                                   Title:    Associate


                               AETNA LIFE INSURANCE COMPANY





                               By:
                                   Name:  Alan Vartelas
                                   Title:    Assistant Vice
President



                               GRANITE PROPERTIES MANAGEMENT
CORP.





                               By:
                                   Name:  Daren J. Wells
                                   Title:    Director, Private
Equity







                               By:
                                   Name:  Paul Finkelstein

                              SCHEDULE I




                                                      Shares of
                                                        Common
                                                        Stock
                                                      initially
                                                       issuable
                                                         upon
                                       Shares of    Conversion of
                         Shares of     Series B      Convertible
                         Series A     Convertible     Preferred
   Name, Address and    Convertible    Preferred        Stock
   Telecopier Number     Preferred       Stock
                           Stock

 Advance Capital           5,524          --          669,575.76
 Partners, L.P.
 660 Madison Avenue,
 15th Floor
 New York, NY  10021
 (212) 835-2020
 Attn:  Robert
 Bernstein

 Advance Capital           1,726          --          209,212.12
 Offshore
      Partners, L.P.
 c/o CITCO Fund
 Services (Cayman
      Islands) Limited
 Safehaven Corporate
 Centre
 Leward Building
 P.O. Box 31106 SMB
 West Bay Road
 Grand Cayman
 Cayman Islands B.W.I.
 345-949-3877
 Attn:  Robert
 Bernstein

 Elliott Associates,       2,000          --          242,424.24
 L.P.
 712 Fifth Avenue,
 35th Floor
 New York, NY  10019
 (212) 974-2092
 Attn:  Jeffrey Kaplan

 Westgate                  2,000          --          242,424.24
 International, L.P.
 c/o Stonington
 Management Corp.
 712 Fifth Avenue,
 36th Floor
 New York, NY  10019
 (212) 974-2092
 Attn:  Jeffrey Kaplan

 Exeter Capital            2,500          --          303,030.30
 Partners IV, L.P.
 10 E. 53rd Street,
 32nd Floor
 New York, NY  10022
 (212) 872-1198
 Attn:  Keith Fox

 Aetna Life Insurance      5,000          --          606,060.60
 Company
 151 Farmington Avenue
 RC21
 Hartford, CT  06516
 (860) 273-8650
 Attention:  Private
 Equity Group

 Ziff Asset                7,250          ---         878,787.88
 Management, L.P.
 c/o Och-Ziff
 Management, L.L.C.
 153 E. 53rd Street,
 43rd Floor
 New York, NY  10022
 (212) 292-5950
 Attn:  Danny Och/Joel
 Frank

 Oz Master Fund, Ltd.      2,000          ---         242,424.24
 c/o Och-Ziff
 Management, L.L.C.
 153 E. 53rd Street,
 43rd Floor
 New York, NY  10022
 (212) 292-5950
 Attn:  Danny Och/Joel
 Frank

 Canaan Equity L.P.         --           5,000        645,161.29
 105 Rowayton Avenue
 Rowayton, CT  06853
 (203) 854-9117
 Attn: Stephen Green

 LB I Group Inc.           5,000          ---         606,060.60
 c/o Lehman Brothers
 3 World Financial
 Center
 6th Floor
 New York, NY  10285
 (212) 528-8821
 Attn:  Stephen
 Berkenfeld

 IBJS Capital               200           ---         24,242.42
 Corporation
 One State Street
 New York, NY  10004
 (212) 858-2768
 Attn: Kevin Falvey

 Granite Properties        1,500          ---         181,818.18
      Management Corp.
 1 Cablevision Center
 P.O. Box 311
 Liberty, NY  12754
 (914) 295-2741
 Attn:  Daren Wells

 Credit Suisse              200           ---         24,242.42
 (Guernsey) Limited
      as trustee for
 the Dynamic
      Growth Fund II
 P.O. Box 122,
 Helvetia Court
 South Esplanade, St.
 Peter Port
 Guernsey  Channel
 Islands
  GY1 4EE
 ###-##-#### 710934
 Attn:  David Preston

 Paul Finkelstein           100           ---         12,121.21