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


                                   FORM 1O-Q/A



[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities  Exchange
Act of 1934 for the quarter ended March 31, 1998 or

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934


                          Commission File Number 1-8138


                            Alarmguard Holdings, Inc.

Incorporated In Delaware                   IRS Identification No: 33-0318116

Principal Executive Offices:               Telephone (203) 795-9000
          125 Frontage Road
          Orange, Connecticut 06477

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes X No __

The number of shares of Alarmguard  Holdings,  Inc.'s  common stock,  $.0001 par
value, outstanding as of April 30, 1998 was 5,593,948.


Items 1 and 2 of the  Company's  Quarterly  Report on Form 10-Q for the  Quarter
ended March 31, 1998 are amended to reflect an imputed non-cash  dividend on the
convertible  preferred  stock as discussed in Note 10. The non-cash  dividend is
reflected in the accompanying  condensed consolidated balance sheet at March 31,
1998 as a charge against  accumulated  deficit with a corresponding  increase in
additional  paid in  capital.  The  non-cash  dividend  is also  included in the
dividend requirement on preferred stock in the condensed  consolidated statement
of operations for the three months ended March 31, 1998.
------------------------------------------------------------------------------


                          PART I. FINANCIAL INFORMATION


ITEM 1.  Financial Statements

ALARMGUARD HOLDINGS, INC.
Condensed Consolidated Balance Sheets
(In thousands)

                                                     March 31      December 31
                                                        1998          1997
                                                    ----------    ------------
                                                    (unaudited)
     
     ASSETS:                                                          
     Current assets:                                                           
       Cash and cash equivalents                       $13,311            $698
       Restricted cash                                   2,608           1,931  
       Accounts receivable, net                          8,442           5,558  
       Inventories                                       3,817           3,065  
       Other current assets                                474             343
                                                      --------        --------  
     Total current assets                               28,652          11,595  
                                                                                
     Property and equipment, net                         3,252           2,133  
     Customer installation costs, net                    9,169           8,868  
     Customer contracts and intangibles, net            79,757          43,027  
     Other investments                                   2,097           2,245  
     Other assets                                        1,692           1,982  
                                                      --------        --------  
     Total assets                                     $124,619         $69,850  
                                                      ========        ========  

                                       2
<PAGE>


ALARMGUARD HOLDINGS, INC.
Condensed Consolidated Balance Sheets (continued)
(In thousands)


                                                     March 31      December 31
                                                        1998           1997
                                                    ----------  --------------
                                                    (unaudited)
     LIABILITIES AND STOCKHOLDERS' DEFICIENCY:                                 
     Current liabilities:                                                      
       Accounts payable                                 $2,105          $2,659 
       Accrued expenses                                  7,994           5,675 
       Current portion of notes payable                    505           2,462 
       Deferred revenue                                  9,456           6,231 
       Other current liabilities                         5,306           4,061 
                                                     ---------         ------- 
     Total current liabilities                          25,366          21,088 
                                                                               
     Notes payable, less current portion                   696             549 
     Credit facility                                    63,500          46,700 
     Subordinated debt                                   3,756           4,389 
     Other liabilities                                     325             321 
                                                                                
     Cumulative Convertible Preferred Stock,                                   
           Redeemable at $1,000 par value:                                     
       Series A, 5% dividends, 35,700 shares issued                    
           and outstanding at March 31, 1998            33,835               -
       Series B, 5,000 shares issued and outstanding                   
           at March 31, 1998                             4,738               -
                                                                             
     Stockholders' deficiency:                                                  
       Common  Stock, $.0001 par value, 25,000,000                     
           shares authorized, 5,593,396 shares                         
           issued and outstanding at March 31, 1998                    
           and December 31, 1997                             1               1
       Additional paid in capital                       44,043          35,286 
       Accumulated deficit                             (51,641)        (38,484)
                                                     ----------    ------------
     Total stockholders' deficiency                     (7,597)         (3,197)
                                                     ----------    ------------
     Total liabilities and stockholders' deficiency   $124,619         $69,850  
                                                     ==========    ============
                                                                                
      See accompanying notes to condensed consolidated financial statements.   
                                                                            
                                       3
<PAGE>


ALARMGUARD HOLDINGS, INC.
Condensed Consolidated Statements of Operations
(Unaudited, in thousands, except per share data)



                                                       For The Three Months
                                                          Ended March 31
                                                    ----------------------------
                                                       1998              1997
                                                     --------        ---------

     Revenue                                           $10,913          $6,597  
     Cost of revenue                                     5,008           2,673  
                                                    -----------        -------- 
     Gross profit                                        5,905           3,924  
                                                                              
       Selling, general and administrative expense       4,440           3,203  
       Acquisition integration expense                     328               -  
       Amortization and depreciation expense             3,524           2,371  
                                                    -----------        -------- 
     Total operating expense                             8,292           5,574  
                                                    -----------        -------- 
                                                    
     Operating loss                                     (2,387)         (1,650) 
                                                                              
     Other income (expense):                                                   
       Interest expense, net                            (1,435)           (844) 
       Other, net                                           35               -  
                                                    -----------        --------
     Net loss                                           (3,787)         (2,494) 
                                                                              
     Dividend requirement on preferred stock,                                  
       including imputed non-cash dividend of                                  
       $9,024 in 1998 (See Note 10)                     (9,370)           (171) 
                                                    -----------        --------
                                                                       
                                                                              
     Loss applicable to common shares                 $(13,157)        $(2,665)
                                                    ===========       =========
                                                 
                                                                              
     Basic and diluted loss per common share            $(2.35)         $(0.87) 
                                                    ===========       =========
                                                                              
     Weighted average number of basic and diluted               
       common shares                                     5,593           2,877
                                                          
     
     See accompanying notes to condensed consolidated financial statements.


                                       4

<PAGE>


ALARMGUARD HOLDINGS, INC.
Condensed Consolidated Statements of Cash Flows
(Unaudited, in thousands)

                                                       For The Three Months
                                                          Ended March 31,
                                                    --------------------------
                                                         1998            1997
                                                    --------------------------
     Operating activities:                                      
     Net loss                                          $(3,787)        $(2,494)
     Adjustments to reconcile net loss to net                      
         cash used in operating activities:                        
         Amortization and depreciation                   3,524           2,371
         Accretion on preferred stock                      73                -
         Customer installation costs incurred           (1,205)         (1,154)
         Changes in operating assets and                      
           liabilities, net of effects of                     
           acquisitions                                    424             632
                                                    ----------     -----------
     Net cash used in operating activities                (971)           (645)
                                                                   
     Investing activities:                                         
       Acquisition of businesses, net of cash                 
       acquired                                        (36,992)              -
       Increase in restricted cash                        (677)              -
       Purchases of property and equipment                (540)            (50)
                                                    ----------     ------------
     Net cash used in investing activities             (38,209)            (50)
                                                                   
     Financing activities:                                         
       Net proceeds from issuance of preferred stock    37,800               -
       Proceeds from term loan                          17,600             800
       Proceeds from bridge loan                             -             500
       Payments of term loan                              (800)              -
       Financing fees paid                                (346)              -
       Payments of other notes payable                  (2,341)           (513)
       Payments of capital leases                         (120)              -
                                                    ----------     ------------
     Net cash provided by financing activities          51,793             787
                                                                   
     Increase in cash and cash equivalents              12,613              92
     Cash and cash equivalents at beginning of period      698             230
                                                    ----------     ------------
     Cash and cash equivalents at end of period        $13,311            $322
                                                    ==========     ============
                                                    
                                                                   
     Cash paid for interest                             $1,222            $855
                                                    ==========     ============
                                                                   
     See accompanying notes to condensed consolidated financial statements.

                                       5
<PAGE>


ALARMGUARD HOLDINGS, INC.
Notes To Condensed Consolidated Financial Statements
(Unaudited)

 1.       Basis of Presentation

     Alarmguard   Holdings,   Inc.   ("Alarmguard"  or  the  "Company")  is  the
successor-in-interest  to Security  Systems  Holdings,  Inc.  ("SSH") and Triton
Group Ltd.  ("Triton"),  following  the merger  ("Merger")  of SSH and Triton on
April 15, 1997.  Alarmguard,  through its wholly-owned  subsidiaries,  sells and
installs  burglar and fire alarm  systems and provides  monitoring  and security
system repair and maintenance services to homeowners and businesses, principally
in the Northeast and Mid-Atlantic regions of the United States.

         The accompanying  unaudited financial  statements have been prepared in
accordance with generally accepted  accounting  principles for interim financial
information and Article 10 of Regulation S-X.  Accordingly,  they do not include
all of the  information  and notes  required by  generally  accepted  accounting
principles for complete financial statements. In the opinion of management,  all
adjustments (consisting of normal recurring accruals) considered necessary for a
fair  presentation  have been  included.  Operating  results for the three month
period ended March 31, 1998 are not  necessarily  indicative of the results that
may  be  expected  for  the  year  ending   December  31,  1998.  The  condensed
consolidated  balance  sheet as of December  31, 1997 has been  derived from the
audited  consolidated  balance  sheet as of that  date.  The  unaudited  interim
financial  information  of  Alarmguard  should be read in  conjunction  with the
audited  consolidated  financial statements of Alarmguard as of and for the year
ended December 31, 1997.

2.       Acquisitions

         On  February  2,  1998,  Alarmguard  purchased  all of the  issued  and
outstanding  shares of capital stock of Detect,  Inc.  ("Pelletier"),  a company
located in  Danbury,  Connecticut,  with  approximately  7,200  subscribers  and
Monthly  Recurring  Revenue ("MRR") of approximately  $0.2 million,  for a total
purchase  price  of  approximately  $10.4  million.  The  total  purchase  price
consisted  of $9.5 million paid at closing,  the  assumption  of $0.5 million of
notes  payable  and $0.4  million  representing  an amount due to the sellers of
Pelletier  based on  certain  post  closing  adjustments.  The  acquisition  was
accounted for under the purchase  method of  accounting  and,  accordingly,  the
purchase  price  was   preliminarily   allocated  to  the  assets  acquired  and
liabilities  assumed  based  on  their  estimated  fair  values  at the  date of
acquisition.  In connection with this acquisition,  the Company received current
assets  of $0.6  million,  property  and  equipment  of $0.2  million,  customer
contracts  of $10.8  million and other  intangibles  of $0.4 million and assumed
current liabilities of $1.6 million.

         During the first  quarter of 1998,  Alarmguard  also  acquired  certain
operating assets of Security System Inc.  ("Sentry"),  of Malden,  Massachusetts
and Protech Security, Inc. of New York for an aggregate of $24.5 million in cash
and $3.1 million representing an amount due to the sellers based on certain post
closing  adjustments.  The acquisitions added  approximately $0.6 million of MRR
and approximately  20,000  customers.  The acquisitions were accounted for under

                                       6

<PAGE>

the purchase method of accounting and, accordingly,  the purchase price has been
preliminarily  allocated to the assets acquired and liabilities assumed based on
their  estimated  fair  values  at  the  respective  dates  of  acquisition.  In
connection with the  acquisitions,  Alarmguard  received  current assets of $1.2
million,  customer contracts of $27.4 million, other intangibles of $0.4 million
and property and equipment of $0.6 million and assumed  current  liabilities  of
$2.0 million.

         Accrued  expenses at March 31, 1998  include  $2.2 million of estimated
costs expected to be incurred as a result of the 1997 and 1998 acquisitions. The
results of  operations  of the  acquired  companies  have been  included  in the
consolidated statements of operations from the respective dates of acquisitions.

         The following  unaudited pro forma information shows the results of the
Company's  operations as though the  acquisitions  consummated  during the first
three  months of 1998 had been made as of January  1, 1998 and  January 1, l997,
and the acquisitions consummated during the fiscal year of 1997 had been made as
of January 1, 1997 (in thousands, except per share data):

                                                     For The Three Months Ended 
                                                             March 31,
                                                     --------------------------
                                                       1998             1997
                                                    -----------   ------------

           Pro forma revenue                         $12,798          $11,979
                                                    ===========   ============
           Pro forma net loss                        $(5,865)         $(6,814)
                                                                                
           Pro forma basic and diluted per share:     $(1.05)          $(1.22)
                                                    ===========   ============
           Shares used in computations                 5,593            5,593
                                                    ===========   ============

         The pro forma  results  are not  necessarily  indicative  of the actual
results of operations that would have been obtained had the  acquisitions  taken
place at the beginning of the  respective  periods or the results that may occur
in the future and do not give effect to cost savings which are expected to occur
as a result of the consolidation of the acquired companies.

3.       Inventories

         Inventories  consist principally of alarm components and supplies which
are carried at the lower of cost or market value.

4.       Customer Installation Costs

         During  each of the  three  months  ended  March  31,  1998  and  1997,
Alarmguard  incurred  approximately $1.2 million of customer  installation costs
primarily  attributable  to the  operations  of its dealer and direct  marketing
programs.   Alarmguard   added   approximately   2,100  and   2,000   customers,
respectively,  through its dealer and direct  marketing  programs  during  these
periods.

                                       7
<PAGE>


5.       Customer Contracts and Intangibles

         Customer  contracts and  intangibles (at cost) consist of the following
(in thousands):

                                           March 31, 1998      December 31, 1997
                                          -----------------   ------------------
                   
           Acquired customer contracts           $88,063             $49,807
           Covenants not to compete               13,713              12,944
           Goodwill                                2,493               2,493
                                          -----------------   ------------------
                   
                                                 104,269              65,244
           Less accumulated amortization         (24,512)            (22,217)
                                          -----------------   ------------------
                   
                                                 $79,757             $43,027
                                          =================   ==================

6.       Other Investments

         Other investments are comprised of certain assets held by Triton at the
time of the Merger in April 1997,  which are in the process of being  liquidated
(in thousands).

                                                March 31,         December 31, 
                                                  1998                1997
                                              ------------      ----------------
           Ridgewood Hotels, Inc. Series A 
             Preferred Stock                    $2,009                $2,009
           Other                                    88                   236
                                              ------------      ----------------
                                                $2,097                $2,245
                                              ============      ================

         Alarmguard owns 450,000 shares of Series A Preferred Stock of Ridgewood
Hotels,  Inc.  ("Ridgewood")  with a face  value  of  $3.6  million.  Alarmguard
currently  receives a 10% quarterly  dividend of $90,000 on this  investment and
the  preferred  stock is  redeemable  at any time by Ridgewood at its face value
plus accrued dividends.  The preferred stock is convertible by Alarmguard at any
time into 1,350,000 Ridgewood common shares, which would represent approximately
47% of the  Ridgewood  common  shares then  outstanding,  or 40% fully  diluted.
Alarmguard  accounts  for the  Ridgewood  investment  using  the cost  method of
accounting.

7.       Long Term Debt

         On February 3, 1998,  in  connection  with the offering of  Convertible
Preferred Stock (see Note 10), Alarmguard, Inc. (the "Borrower"), a wholly owned
subsidiary of the Company,  increased the  availability  under the Third Amended
and Restated Term Loan and Acquisition  Credit Agreement (the "Credit Facility")
from $60 million to $90 million.  The Credit Facility provides for interest only
advances until January 31, 2000 and  amortization  thereafter.  Borrowings under
the Credit  Facility  are secured by  substantially  all of the  properties  and
assets of the  Borrower  including  accounts  receivable,  inventory,  leasehold
interests,  customer  contracts and the capital stock of all of the subsidiaries
of the Company.  Interest on the Credit  Facility  accrues and is payable at the
option  of the  Borrower  at  either  prime  plus 1 1/2%  or  LIBOR  plus  2.75%
(approximately  8.7% at March  31,  1998),  however  the  Company  has fixed the
interest rate on $40.0 million of its outstanding  borrowings at 8.84% for three

                                       8
<PAGE>

years through an interest rate swap  agreement.  At March 31, 1998,  outstanding
borrowings under the Credit Facility were $63.5 million. 

8. Stock Options

         On March 10, 1998,  the Board of Directors  issued  365,000  additional
stock options to the senior management of Alarmguard which vest over a four-year
period from the date of grant.  The exercise  price for all options  granted was
$10.00 per share,  the quoted  market  value of the common  stock on the date of
grant.

9.       Commitments and Contingencies

         The Company  experiences routine litigation in the normal course of its
business.  Management does not believe that any pending or threatened litigation
will have a material  adverse  effect on the  financial  condition or results of
operations of the Company.

 10.      Sale of Cumulative Convertible Preferred Stock

         On February 3, 1998, the Company completed an offering of 40,000 shares
of Cumulative  Convertible  Preferred Stock (35,000 shares of Series A Preferred
and 5,000 shares of Series B Preferred) are redeemable at $1,000 per share, five
years from the date of issuance,  yielding gross proceeds  totaling $40 million.
The Company  issued 700  additional  shares of the Series A  Preferred  Stock in
exchange for $0.7 million of the Company's  subordinated  debt.  Net proceeds of
the offering,  after the payment of investment  banking fees and legal expenses,
amounted to approximately  $37.8 million.  The costs incurred for completing the
February  1998  offering  are being  amortized to the  dividend  requirement  on
Preferred  Stock over the five-year  life of the security  with the  unamortized
balance reflected as a reduction of the Preferred Stock's carrying value.

         The Series A Preferred  Stock pays  quarterly  cash dividends at 5% per
annum.  Under the terms of the securities,  holders of the Series A and Series B
Preferred  Stock  have the right to  convert  their  shares  at any  time,  into
4,972,434  shares of the Company's common stock at the conversion price of $8.25
per share and $7.75 per share,  respectively,  subject to certain  anti-dilution
provisions.  The holders of the newly issued  preferred  stock have the right to
elect two  additional  members  to the  Company's  Board of  Directors.  The net
proceeds from the offering and the increased credit facility discussed in Note 7
are intended to finance  acquisitions and expand the Company's Dealer and Direct
Marketing  Programs.  In connection  with the sale of the Preferred  Stock,  the
Company  imputed a one-time  non-cash  dividend of  approximately  $9.0  million
($1.61 per common share) as a result of the conversion  prices of the two series
of  Preferred  Stock being less than the quoted  market  price of the  Company's
Common Stock at the date of issuance,  as required by EITF D-60:  Accounting for
the  Issuance  of  Convertible  Preferred  Stock  and  Debt  Securities  with  a
Nondetachable  Conversion  Feature.  Such amount was recognized upon issuance of
the  Preferred  Stock  as  a  charge  against   accumulated   deficit,   with  a
corresponding  increase  in  additional  paid in capital.  The imputed  non-cash
dividend is also included in the dividend  requirement on Preferred Stock in the
condensed  consolidated statement of operations for the three months ended March
31, 1998.

                                       9

<PAGE>



 11.      Earnings per Share

         The 1997  calculation  of basic  and  diluted  loss  per  common  share
excludes  the  dividend  requirement  on  preferred  stock  as a  result  of the
conversion of the Preferred Stock and related accrued  dividends into Alarmguard
Common Stock at the time of the Merger.

           All dilutive  securities  (stock  options,  warrants and  convertible
preferred  stock)  have been  excluded  from the diluted  loss per common  share
calculation as such instruments are antidilutive.

12.      Recent FASB Pronouncements

         In 1998, the FASB issued SFAS No. 131, "Disclosure about Segments of an
Enterprise  and  Related  Information."  The  Company  will  adopt  SFAS No. 131
effective  for year end  financial  reporting  in 1998 and  expects no  material
impact upon adoption.

Item 2.  Management's  Discussion  and Analysis of Financial  Condition and
Results of Operations
        
         Certain matters in this section constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking  statements  involve known and unknown risks,  uncertainties and
other factors which may cause the actual  results of Alarmguard  Holdings,  Inc.
(the  "Company" or  "Alarmguard")  to be materially  different  from  historical
results  or from any  results  expressed  or  implied  by such  forward  looking
statements.  These factors are discussed  under the caption "Risk  Factors" in a
Registration  Statement  on  Form  S-4  (File  No.  333-23307)  filed  with  the
Securities and Exchange Commission on March 14, 1997.

General Overview

         For an overview of the Company's accounting policies, see the Company's
audited consolidated  financial statements as of and for the year ended December
31, 1997.

         Alarmguard  sells and  installs  burglar  and fire  alarm  systems  and
provides security monitoring services and security system repair and maintenance
services  to  homeowners  and  businesses,  principally  in  the  Northeast  and
Mid-Atlantic  regions of the United  States.  Alarmguard  provides  its security
alarm systems and services  primarily  under its trademark  "Alarmguard".  As of
March 31, 1998,  Alarmguard had approximately  $2.9 million of Monthly Recurring
Revenue ("MRR") and approximately 92,000 subscribers.

         On April 15, 1997,  SSH  completed a merger with Triton  pursuant to an
Agreement and Plan of Merger dated  December 23, 1996, as amended March 6, 1997.
The combined company was renamed Alarmguard Holdings, Inc., the common shares of
which are listed for trading on the  American  Stock  Exchange  under the symbol
"AGD".

                                       10

<PAGE>

         Alarmguard's   objective  is  to  provide  residential  and  commercial
security  services to an increasing number of subscribers.  Alarmguard's  growth
strategy is to enhance its position in the security alarm monitoring industry in
the  Northeastern  and  Mid-Atlantic  United States by increasing the number and
density of  subscribers  for whom it provides  services.  Alarmguard is pursuing
this  strategy  through a balanced  growth  plan  involving:  (1)  incorporating
acquisitions  of portfolios of  subscriber  accounts in existing and  contiguous
markets;  (2) internal growth through direct marketing to obtain new subscribers
(the "Direct  Marketing  Program");  (3)  acquiring  credit-approved  monitoring
contracts from Alarmguard authorized dealers (the "Dealer Program");  (4) growth
of Alarmguard's core business through referrals and traditional local marketing;
and (5)  acquisition of new  multi-locational  commercial  subscribers  from its
National  Accounts Program.  Alarmguard  believes that increasing the number and
density  of its  subscribers  will  help it to  achieve  economies  of scale and
enhance results of operations.

         During the three months ended March 31, 1998, Alarmguard acquired three
companies in the security  alarm  installation  and  monitoring  business for an
aggregate  of $37.5  million in cash,  notes  payable and amounts due to sellers
based on certain post closing adjustments.  The acquisitions added approximately
$0.8 million of MRR and approximately 27,000 subscribers.

Key Operating Measures

         The  Company   employs  three  internal   measurements  to  assess  the
performance of its operations: Adjusted EBITDA, MRR and Gross MRR Attrition.

         Adjusted EBITDA. Adjusted EBITDA is derived by adding Dealer and Direct
Marketing Program and acquisition  integration expenses incurred,  net of Dealer
and  Direct  Marketing  Program  revenues  earned,  to EBITDA  (Earnings  Before
Interest,  Taxes,  Depreciation and Amortization).  This calculation  provides a
basis for  comparison of  Alarmguard's  results to those of other security alarm
companies that grow through the  acquisition of subscriber  accounts rather than
those that grow both internally and through  acquisitions.  An amount similar to
Adjusted EBITDA is used by lenders in extending  credit to Alarmguard.  Adjusted
EBITDA does not  represent  cash flows from  operations  as defined by generally
accepted accounting  principals and should not be construed as an alternative to
net income.  Adjusted  EBITDA was $1.9  million for the three months ended March
31, 1998  compared to $1.3  million for the three months ended March 31, 1997, a
51% increase.

                                                     For The Three Months Ended
                                                              March 31,
                                                     ---------------------------
                                                         1998            1997
                                                     -----------     -----------
                                                            (in thousands)
  EBITDA                                               $1,137            $721
    Less Dealer and Direct Marketing Program revenue     (348)           (353)
    Plus Dealer and Direct Marketing Program expense      784             889
    Plus acquisition integration expense                  328               -
                                                     -----------     -----------
  Adjusted EBITDA                                      $1,901          $1,257
                                                     ===========     ===========

                                       11

<PAGE>

         Monthly Recurring Revenue. MRR represents revenue that a company in the
security  alarm  industry is entitled to receive  under  contracts  (monitoring,
leasing,  and  maintenance)  in effect at the end of such period.  MRR is a term
commonly  used in the  security  alarm  industry  as a measure  of the size of a
company. It does not measure profitability or performance,  and does not include
any  allowance  for  future  subscriber  attrition  or  uncollectible   accounts
receivable.

         Gross MRR  Attrition.  Gross MRR attrition has an adverse effect on the
Company's  financial  position and results of  operations,  since it affects the
Company's  recurring  revenues.  Gross MRR attrition,  generally expressed on an
annualized  basis,  can be measured in terms of  decreased  MRR  resulting  from
canceled subscriber accounts.  Gross MRR attrition is defined by the Company for
a particular period as a quotient,  the numerator of which is equal to gross MRR
lost as the result of canceled  subscriber  accounts  during such period and the
denominator  of which is the average  month end MRR during such 12 month period.
The following table sets forth the Company's MRR additions,  cancellations,  and
gross MRR attrition for the periods indicated (in thousands):

                                        Three Months            Twelve Months
   MRR                              Ended March 31, 1998      Ended December 31,
                                           1998                     1997
                                   --------------------      -------------------
   Beginning of period                    $2,087                   $1,392
   Dealer and Direct Marketing 
     Program additions
                                              55                      193
   Acquisition additions                     777                      586
   Other additions (1)                        47                      134
   Canceled MRR (2)                          (72)                    (218)
                                   --------------------      -------------------
   End of period                          $2,894                   $2,087
                                   ====================      ===================

   Gross MRR attrition (3)                 11.9%                    11.8%
                                   ====================      ===================

(1)   MRR primarily generated through traditional non-investment sales programs.
(2)   Includes  canceled  MRR of  subscribers  who have  moved  from homes or
      businesses  in  which  an  existing   alarm  system  has  already  been
      installed.
(3)   Calculated on a trailing twelve-month basis.


Results of Operations

Three Months Ended March 31, 1998 Compared to Three Months Ended March 31, 1997

                                       12

<PAGE>

         Revenue.  Revenues for the three months ended March 31, 1998 were $10.9
million,  an increase of $4.3 million,  or 65.4%,  over the comparable period in
1997.  This increase was  primarily the result of a 63.2%  increase of recurring
revenue to $6.8 million from $4.2 million and a 68.8%  increase in  installation
revenue to $3.4 million from $2.0 million. A significant  portion of the revenue
growth was related to acquisition activity in 1997 and 1998.

         Gross Profit. Gross profit increased to $5.9 million, or 54.1% of total
revenue,  for the first quarter of 1998  compared to $3.9  million,  or 59.5% of
total  revenue,  in the first quarter of 1997. The decrease in gross profit as a
percentage  of  total  revenue  was  primarily  the  result  of  several  larger
commercial  installations  in the  traditional  business  which had lower  gross
profit margins than the Company's traditional business as well as lower per-unit
revenue for installations through the Direct Marketing Program.

         Selling,    General   and   Administrative.    Selling,   general   and
administrative  expense for the first  quarter of 1998  increased  approximately
$1.2 million,  or 38.6%,  over the  comparable  period in 1997. The increase was
primarily  the  result  of  the  acquisitions  as  well  as  increased  staffing
requirements at the corporate level required to facilitate the Company's  growth
plan and additional expenses of operating as a public company,  costs which were
not incurred  during the first quarter of 1997.  As a percent of total  revenue,
selling,  general  and  administrative  expense  for the first  quarter  of 1998
decreased  to  40.7%  from  48.6%  in the  comparable  1997  period,  reflecting
economies of scale resulting from incremental revenue growth.

         Acquisition  Integration  Expenses.  During the first  three  months of
1998, the Company incurred  $328,000 of costs associated with the integration of
acquired  subscriber  accounts into the Company's  system.  These costs were not
material in the first quarter of 1997.  Management  expects to continue to incur
such  costs  in  the  future,   principally  relating  to  the  acquisition  and
integration of subscriber  account  portfolios  acquired in the first quarter of
1998 and future acquisitions.

         Amortization  and  Depreciation.  Amortization and depreciation for the
first  quarter  of 1998  increased  by  approximately  $1.2  million,  or 48.6%,
compared to the same period in 1997.  This  increase was primarily the result of
the acquisition activity in 1997 and 1998.

         Operating  Loss.  The  operating  loss for the  first  quarter  of 1998
increased to approximately $2.4 million from $1.7 million in the comparable 1997
period. As a percent of total revenue, the operating loss decreased to 21.9% for
the first  quarter of 1998  compared to 25.0% for the same period in 1997.  This
improvement  reflects  the  increased  profitability  derived  from  incremental
revenues.

         Interest  Expense.  Interest expense,  net of interest income,  for the
three months ended March 31, 1998 was $1.4 million,  compared to $0.8 million in
the  comparable  period in 1997.  This  increase is  primarily  the result of an
increased  outstanding  balance under the Company's credit facility in the first
quarter of 1998 compared to the first quarter of 1997,  reflecting the Company's
growth  through  acquisitions  combined with  subscriber  additions  through the
Dealer and Direct Marketing Programs.

                                       13

<PAGE>

         Dividend  Requirement on Preferred Stock.  The dividend  requirement on
preferred  stock  during  the first  quarter of 1998  reflects  the 5% per annum
dividend on the Cumulative  Convertible Preferred Stock issued in February 1998,
amortization  of the costs  incurred for  completing  the offering of Cumulative
Convertible  Preferred  Stock issued in February 1998,  and an imputed  one-time
non-cash  dividend of  approximately  $9.0 million as a result of the conversion
prices of the two series of  Preferred  Stock being less than the quoted  market
price of the Company's  Common Stock at the date of issuance.  In the comparable
period in the prior year,  this amount  reflects  the  dividends  accrued on the
Redeemable  Preferred  Stock of the  predecessor  company that were converted to
Common Stock of the Company in connection  with the Triton Merger in April 1997.
The costs incurred for completing the February 1998 offering are being amortized
to the dividend  requirement  on Preferred  Stock over the five-year life of the
security with the unamortized  balance reflected as a reduction of the Preferred
Stock's carrying value.


Liquidity and Capital Resources

         Capital  Resources.  The Company has financed its operations and growth
since  May 1992  with a  combination  of  borrowings  under  credit  facilities,
issuance of subordinated  debentures,  sale of common and preferred  stock,  the
1997 Merger with Triton,  and  internally  generated  cash flows.  The Company's
principal  uses of cash have been for the  acquisition  of subscriber  accounts,
costs  associated  with the Dealer and Direct  Marketing  Programs  and interest
payments on borrowings under the Credit Facility.  A substantial  portion of the
Company's  future operating cash flow will be used to fund the Dealer and Direct
Marketing Programs and to service borrowings under the Credit Facility and other
company debt.  There can be no assurance  that the Company will continue to have
the  ability  to  meet  its  borrowing  requirements  to  fund  its  acquisition
strategies and Dealer and Direct Marketing Programs.

         In February 1998, the Company completed an offering of 40,000 shares of
Cumulative  Convertible  Preferred  Stock  (35,000  shares of Series A and 5,000
shares of Series B) at $1,000 per share  yielding  gross  proceeds  totaling $40
million.  Concurrently, the Company issued 700 additional shares of the Series A
Preferred Stock in exchange for $0.7 million of the company's subordinated debt.
The Series A Preferred Stock pays quarterly dividends at 5% per annum. Under the
terms of the  securities,  holders of the Series A and Series B Preferred  Stock
have the right to convert their shares at any time, into shares of the Company's
Common  Stock at the  conversion  price of $8.25 per share and $7.75 per  share,
respectively,  subject to certain anti-dilution provisions.  Concurrent with the
offering,  the Company  increased  its credit  facility  from $60 million to $90
million.  The proceeds from the offering and borrowings from the expanded Credit
Facility are being used to finance  acquisitions and expand the company's Dealer
and Direct Marketing Programs.

         As of March 31,  1998,  the  Company  had $13.3  million in cash.  This
represents the net proceeds from the Preferred Stock offering that were not used
to fund first quarter acquisitions and operations. Additionally, the Company had

                                       14

<PAGE>

$63.5 million  outstanding  under its Credit  Facility with  approximately  $1.6
million of  availability  at the end of the quarter.  The  Company's  ability to
borrow  under the Credit  Facility  is limited  by certain  representations  and
financial covenants.

         The  Credit  Facility  is a  non-amortizing  loan which  converts  to a
five-year  amortizing term loan on April 30, 2000.  Borrowings  under the Credit
Facility are secured by  substantially  all of the  properties and assets of the
Borrower including accounts receivable, inventory, leasehold interests, customer
contracts and the capital stock of all of the subsidiaries of the Company.

         Alarmguard has subordinated debentures of $3.9 million bearing interest
at 15%, which are due in April 1999. In connection with the  subordinated  debt,
Alarmguard issued warrants to purchase 215,939 shares of Alarmguard Common Stock
at an exercise  price of $11.11 per share,  the value of which was accounted for
as a discount to the subordinated  debt and is being amortized over the two year
life of the  underlying  debt  instrument.  The Company also has a total of $3.8
million due to sellers of previous  acquisitions,  a portion of which is secured
by various notes.  A portion of the amounts due to sellers  requires the Company
to make periodic principal and interest payments.

         The Company intends to continue to use its existing cash balances, cash
flows from operations,  the liquidation of its other  investments and borrowings
under the credit  facility  to finance  the  addition  of  subscriber  accounts,
primarily through acquisitions and the Dealer and Direct Marketing Programs.

         Additionally,  the Company,  depending on future needs and the cost and
availability  of  various  financing  alternatives,  may from  time to time seek
additional debt or equity financing in the public or private markets in order to
continue to support the growth of subscriber accounts. There can be no assurance
that the Company will be able to obtain such capital on  acceptable  terms or at
all.

         If cash flows  from  operations,  combined  with  borrowings  under the
credit  facility and other  borrowings  are  insufficient  to fund the Company's
growth  strategies,  management  would  curtail the Dealer and Direct  Marketing
Programs  and  implement a cost  reduction  strategy to the extent  necessary to
satisfy its obligations.

         Liquidity.  During  the  first  three  months  of 1998  and  1997,  the
Company's net cash used in operating  activities was approximately  $1.0 million
and $0.6  million,  respectively.  The increase was  primarily the result of the
increased interest costs and acquisition integration expenses,  partially offset
by improved  operating  margins due to incremental  revenue growth and resulting
economies of scale.

         For the first quarter of 1998 and 1997,  the Company's net cash used in
investing activities was approximately $38.2 million and $50,000,  respectively.
This  significant  increase  reflects the  acquisitions  in the first quarter of
1998.

         Net cash  provided by  financing  activities  was  approximately  $51.8
million in the first quarter of 1998 as compared to $0.8 million in the year ago

                                       15

<PAGE>


period.  The  increase  reflects the cash  generated  from the  Preferred  Stock
offering and increased borrowings under the credit facility discussed above.

         The Company incurred net losses of approximately  $3.8 million and $2.5
million  for the first  quarter  of 1998 and  1997,  respectively.  The  Company
expects to incur losses for the foreseeable future, the result of its continuing
growth strategy.

          Recent FASB Pronouncements. In 1998, the FASB  issued  SFAS  No.  131,
"Disclosure  about  Segments  of an  Enterprise  and Related  Information."  The
Company will adopt SFAS No. 131 effective  for year end  financial  reporting in
1998 and expects no material impact upon adoption.

         The Company continues to review "Year 2000" issues. Based on its review
to date, it does not anticipate  incurring any significant costs associated with
this issue.

                                       16
<PAGE>



                           PART II - OTHER INFORMATION

Item 6.   Exhibits and Reports on Form 8-K

(a)   Exhibits

      The  following  exhibits are filed with this  quarterly  report on Form
l0-Q:

Exhibits
Number            Exhibit

27                Financial data schedule


 (b)  Reports on Form 8-K

         The Company filed a current  report on Form 8-K dated April 1, 1998, in
which the Company  reported under Item 2.  Acquisition or Disposition of Assets,
the  acquisition  of certain  assets of Security  Systems,  Inc. (dba  "Sentry")
completed on March 17, 1998.




                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                                     ALARMGUARD HOLDINGS, INC.



DATE:    November 13, 1998                           By: /s/David Heidecorn
        ------------------------------                  ----------------------
                                                         David Heidecorn
                                                         Principal Financial 
                                                         Officer