916310--3/16/2007--PROTECTION_ONE

related topics

{customer, product, revenue}

{debt, indebtedness, cash}

{regulation, change, law}

{acquisition, growth, future}

{system, service, information}

{personnel, key, retain}

{loan, real, estate}

{competitive, industry, competition}

{gas, price, oil}

{stock, price, operating}

{control, financial, internal}

{product, candidate, development}

Quadrangle is our principal stockholder and can exercise a controlling influence over us. We have a history of losses, which are likely to continue. Our substantial indebtedness could adversely affect our financial condition. Restrictive covenants restrict our ability to operate our business and to pursue our business strategies, and our failure to comply with these covenants could result in an acceleration of our indebtedness. If we are unable to repay or refinance our 8.125% senior subordinated notes prior to July 2008, our outstanding indebtedness under our senior credit facility will become due and payable. We rely on technology that may become obsolete, which could require significant capital expenditures. The failure to successfully integrate IASG s business and operations in the expected time frame may adversely affect the combined company s future results. Shifts in our current and future customers selection of telecommunications services could increase customer attrition and could adversely impact our earnings and cash flow. We face increasing competition and pricing pressure from other companies in our industry and if we are unable to compete effectively with these companies, our sales and profitability could be adversely affected. The competitive market for the acquisition and creation of accounts may affect our future profitability. Loss of customer accounts could materially adversely affect our operations. Our customer acquisition strategies may not be successful, which would adversely affect our business. We rely on a marketing alliance for the generation of many new accounts. Increased adoption of false alarm ordinances by local governments may adversely affect our business. Increased adoption of statutes and governmental policies purporting to void automatic renewal provisions in our customer contracts, or purporting to characterize certain of our charges as unlawful, may adversely affect our business. Due to a concentration of accounts in California, Florida and Texas, we are susceptible to environmental incidents that may negatively impact our results of operations. Declines in rents, occupancy rates and new construction of multifamily dwellings may affect our sales in this marketplace. We could face liability for our failure to respond adequately to alarm activations. Future government regulations or other standards could have an adverse effect on our operations. The loss of our Underwriter Laboratories listing could negatively impact our competitive position. We depend on our relationships with alarm system manufacturers and suppliers. If we are not able to maintain or renew these alliances, our ability to create new customers and to service our existing account base could be negatively affected. We rely on subcontractors in certain markets to install, service and repair alarm systems. Most of our customers alarm systems communicate with our monitoring center via Public Switched Telephone Network lines, or PSTN lines, provided by an incumbent local exchange carrier, which are losing market share to wireless and Internet-based means of communication. We are dependent upon our experienced senior management, who would be difficult to replace. We have incurred and will continue to incur increased costs as a result of securities laws and regulations relating to corporate governance matters and public disclosures.

Full 10-K form ▸

916310--3/16/2007--PROTECTION_ONE_INC