Document:

Exhibit 10.1

 

POI ACQUISITION, L.L.C.

QUADRANGLE MASTER FUNDING LTD

 

August 23, 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); (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); (e) letter from POI Acquisition and Quadrangle to POAM, POI and
Network, dated May 28, 2004, further amending the term of the Agreement (except
as otherwise provided therein); (f) letter from POI Acquisition and Quadrangle
to POAM, POI and Network, dated June 28, 2004, further amending the terms of
the Agreement (except as otherwise provided therein); and (g) letter from POI
Acquisition and Quadrangle to POAM, POI and Network, dated July 26, 2004,
further amending the terms of the Agreement (except as otherwise provided therein)
(the “Fifth 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 Fifth Letter Agreement, is 11:59 p.m. prevailing Eastern Time on
August 23, 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 196 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 August 27, 2004, September 3, 2004 or September 10, 2004.  Under no circumstance shall the Outside
Standstill Period exceed 217 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) Item IV
of Schedule 2 to the Agreement is hereby deleted in its entirety; (b) 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 (c)
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:

  
				

 

 

	
  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: PresidentExhibit 10.2

 

POI ACQUISITION I, INC.

 

August 23, 2004

 

Protection One, Inc.

818 South Kansas Avenue

Topeka, Kansas  66612

Attn:       Darius G. Nevin

Executive Vice President and Chief Financial Officer

 

Dear Mr.
Nevin:

 

1.             We refer to the:  (a) Equity Standstill Agreement, dated as of
February 17, 2004 (the “Agreement”), by and between Protection One,
Inc. (“POI”) and POI Acquisition I, Inc. (“POI Acquisition”); (b) letter from
POI Acquisition to POI, dated May 17, 2004, amending the term of the Agreement;
(c) letter from POI Acquisition to POI, dated May 24, 2004, further amending
the term of the Agreement; (d) letter from POI Acquisition to POI, dated
May 28, 2004, further amending the term of the Agreement; (e) letter
from POI Acquisition to POI, dated June 28, 2004, further amending the term of
the Agreement; and (f) letter from POI Acquisition to POI, dated July 26, 2004,
further amending the term of the Agreement (the “Fifth Letter Agreement”).  Capitalized terms used but not defined
herein shall have the meanings ascribed to such terms in the Agreement.

 

2.             Pursuant to section 2.02 of the Agreement, the Agreement
shall terminate and be of no further force and effect on the Specified Date
(which currently, under clause (i) of section 2.02 of the Agreement, as amended
by the Fifth Letter Agreement, is 11:59 p.m. prevailing Eastern Time on August
23, 2004).  By this letter agreement and
at your request, we hereby agree to further amend the definition of the
Specified Date to mean the earlier of: 
(i) 11:59 p.m. prevailing Eastern time on the date that is 196 days
after the Effective Time (the “Outside Date”) (the period beginning with the
Effective Time and continuing through and including the Outside Date, the
“Outside Standstill Period”); or (ii) the occurrence of any Equity Standstill
Termination Event.  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 either party hereto, unless POI Acquisition delivers written notice
of non-extension to POI pursuant to Paragraph 4 of this letter agreement on
August 27, 2004, September 3, 2004 or September 10, 2004.  Under no circumstance shall the Outside
Standstill Period exceed 217 days pursuant to the terms of this letter
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, in the event that POI Acquisition delivers 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.

 

4.             Any written notice to be given
pursuant to this letter agreement by POI Acquisition 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

 

*              *              *              *

 

 

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 I, INC.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ David A. Tanner

  	
   

  
	
  Name: 

  
	
  Title:

  

 

 

Agreed as of the date first
written above:

 

	
  PROTECTION ONE, INC.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Darius G. Nevin

  	
   

  
	
  Name: Darius G. Nevin

  
	
  Title: Executive Vice President and Chief Financial Officer

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