Exhibit
10.1


 


POI
ACQUISITION, L.L.C.

QUADRANGLE MASTER FUNDING LTD


 


 


May 28, 2004


 


Protection One Alarm Monitoring, Inc.


Protection One, Inc.


Network Multi-Family Security Corporation


c/o Protection One, Inc.


818 South Kansas Avenue


Topeka, Kansas  66612


 


Ladies and Gentlemen:


 


1.             We refer to the:  (a) Credit Facility Standstill Agreement, dated as of February
17, 2004 (the “Agreement”), among Protection One Alarm Monitoring, Inc.
(“POAM”), Protection One, Inc., (“POI”), Network Multi-Family Security Corporation
(“Network”) and POI Acquisition, L.L.C. (“POI Acquisition”); (b) letter from
Quadrangle Master Funding Ltd (“Quadrangle”) to POAM, dated February 27, 2004,
(i) advising POAM of Quadrangle’s assumption from POI Acquisition of one-third
of the obligations under the Credit Facility; and (ii) confirming Quadrangle’s
agreement to be bound by the obligations of POI Acquisition set forth in the
Agreement; (c) letter from POI Acquisition and Quadrangle to POAM, POI and
Network, dated May 17, 2004, amending the term of the Agreement (except as
otherwise provided therein); and (d) letter from POI Acquisition and Quadrangle
to POAM, POI and Network, dated May 24, 2004, further amending the term of the
Agreement (except as otherwise provided therein) (the “Second Letter
Agreement”).  Capitalized terms used but
not defined herein shall have the meanings ascribed to such terms in the
Agreement.


 


2.             Pursuant to section 3 of the Agreement,
the Agreement shall terminate and be of no further force and effect on the Debt
Specified Date (which currently, under clause (i) of section 3 of the
Agreement, as amended by the Second Letter Agreement, is 11:59 p.m. prevailing
Eastern Time on May 31, 2004).  By this
letter agreement and at your request, we hereby agree to further amend the
definition of the Outside Date to mean 11:59 p.m. prevailing Eastern time on
the date that is 111  days after the Effective Time (the period
beginning with the Effective Time and continuing through and including the
Outside Date, the “Outside Standstill Period”).  We also hereby agree that the Outside Standstill Period shall be
automatically extended three (3) consecutive times by seven (7) day periods
(and the definition of Outside Date shall be further amended


 

















 


accordingly), without any further action
required to be taken by any party hereto, unless POI Acquisition and Quadrangle
deliver written notice of non-extension to POI pursuant to Paragraph 4 of this
letter agreement on June 4, 2004, June 11, 2004 or June 18, 2004.  Under no circumstance shall the Outside
Standstill Period exceed 132 days pursuant to the terms of this letter
agreement.  This letter agreement shall
not apply to section 5 of the Agreement. 
Except as otherwise provided herein, the Agreement shall remain in full
force and effect subject to the terms and provisions thereof.


 


3.             Notwithstanding anything to the contrary
contained herein, (a) in the event that POI Acquisition and Quadrangle deliver
written notice of termination to POI pursuant to Paragraph 4 of this letter
agreement, this letter agreement and the Outside Standstill Period shall
terminate effective as of two business days following the date of receipt of
such written notice by POI; and (b) nothing herein shall constitute an
amendment or waiver of the termination provisions of clause (ii) of section 3
of the Agreement.


 


4.             Any written notice to be given pursuant to
this letter agreement by POI Acquisition and Quadrangle shall be sufficiently
given if sent by overnight delivery service or by facsimile transmission, with
receipt confirmed, as follows:


 


Protection
One, Inc.

4221 W. John Carpenter Freeway

Irving, Texas, 75063 

Attn: J. Eric Griffin, General Counsel

Facsimile: (972) 916-6195


 


with a copy to:


 


Kirkland &
Ellis LLP

200 E. Randolph Drive

Chicago, Illinois 60601

Attn: Anup Sathy

Facsimile: (312) 861-2200


 


5.             This letter agreement may be executed in
counterparts.  Please confirm your
agreement with the foregoing by signing and returning to the undersigned the
duplicate copy of this letter agreement enclosed herewith.


 


*     *     *     *


 

















 


Very truly yours,


 


	
  POI ACQUISITION, L.L.C.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/ David A. Tanner

  	
   

  	
   

  
	
  Name: David A. Tanner

  	
   

  
	
  Title:

  	
   

  
	
   

  	
   

  
	
  QUADRANGLE MASTER

  	
   

  
	
  FUNDING LTD

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/ Michael Weinstock

  	
   

  	
   

  
	
  Name: Michael Weinstock

  	
   

  
	
  Title: Member

  	
   

  
					



 

















 


Agreed as of the date first written above:


 


	
  PROTECTION ONE ALARM

  
	
  MONITORING, INC.

  
	
   

  
	
  By:

  	
   /s/ Darius G. Nevin

  	
   

  
	
  Name: Darius G. Nevin

  
	
  Title: Executive Vice President and

  
	
  Chief Financial Officer

  
	
   

  
	
   

  
	
  PROTECTION ONE, INC.

  
	
   

  
	
   

  
	
  By:

  	
   /s/ Darius G. Nevin

  	
   

  
	
  Name: Darius G. Nevin

  
	
  Title: Executive Vice President and

  
	
  Chief Financial Officer

  
	
   

  
	
   

  
	
  NETWORK MULTI-FAMILY

  
	
  SECURITY CORPORATION

  
	
   

  
	
   

  
	
  By:

  	
   /s/ Steve Williams

  	
   

  
	
  Name: Steve Williams

  
	
  Title: President