BY EXECUTIVE FROM
THE BENEFIT LUMP-SUM PAYMENT AND THE BENEFITS GROSS-UP PAYMENT, AFTER REDUCTION
FOR ANY FEDERAL, STATE AND LOCAL INCOME AND EMPLOYMENT TAXES ON THE BENEFITS
LUMP-SUM PAYMENT AND THE BENEFITS GROSS-UP PAYMENT, SHALL EQUAL THE BENEFITS
LUMP-SUM PAYMENT. NOTWITHSTANDING THE FOREGOING, IN THE EVENT EXECUTIVE BECOMES
REEMPLOYED WITH ANOTHER EMPLOYER AND BECOMES ELIGIBLE TO RECEIVE BENEFITS FROM
SUCH EMPLOYER, THE BENEFITS DESCRIBED HEREIN SHALL BE SECONDARY TO SUCH BENEFITS
DURING THE PERIOD OF EXECUTIVE'S ELIGIBILITY, BUT ONLY TO THE EXTENT THAT THE
COMPANY REIMBURSES EXECUTIVE FOR ANY INCREASED COST AND PROVIDES ANY ADDITIONAL
BENEFITS NECESSARY TO GIVE EXECUTIVE THE BENEFITS PROVIDED HEREUNDER; AND
(D)
EXECUTIVE'S RIGHTS WITH RESPECT TO ALL OUTSTANDING STOCK OPTIONS, STOCK
APPRECIATION RIGHTS AND OTHER EQUITY BASED AWARDS ("AWARDS") IN CONNECTION WITH
ANY TERMINATION OF EMPLOYMENT, INCLUDING A QUALIFYING TERMINATION, SHALL BE
GOVERNED EXCLUSIVELY, AS APPLICABLE, BY THE TERMS OF THE PROTECTION ONE, INC.
2004 STOCK OPTION PLAN, THE PROTECTION ONE, INC. STOCK APPRECIATION RIGHTS PLAN
AND THE GRANT AND OPTION AGREEMENTS PROVIDED THEREUNDER.
(B)
NON-QUALIFYING TERMINATION.
IF THE EMPLOYMENT OF EXECUTIVE TERMINATES
PURSUANT TO A NON-QUALIFYING TERMINATION, THEN THE COMPANY SHALL PAY TO
EXECUTIVE WITHIN FIVE (5) BUSINESS DAYS FOLLOWING THE DATE OF TERMINATION, A
LUMP-SUM CASH PAYMENT EQUAL TO THE SUM OF (I) EXECUTIVE'S ANNUAL BASE SALARY
PAYABLE THROUGH THE DATE OF TERMINATION; (II) BONUS AMOUNTS EARNED BY EXECUTIVE
AND DECLARED AND APPROVED BY THE BOARD; AND (III) THE CASH EQUIVALENT OF ANY
ACCRUED PAID TIME OFF; IN EACH CASE TO THE EXTENT NOT ALREADY PAID.
THE
7
COMPANY MAY MAKE SUCH ADDITIONAL PAYMENTS AND PROVIDE SUCH ADDITIONAL BENEFITS
TO EXECUTIVE AS THE COMPANY AND EXECUTIVE MAY AGREE IN WRITING.
6.
NON-COMPETITION.
EXECUTIVE HEREBY ACKNOWLEDGES THAT THE SERVICES WHICH
SHE WILL PERFORM FOR THE COMPANY ARE OF A SPECIAL AND UNIQUE NATURE, AND THAT
THE COMPANY WOULD FIND IT EXTREMELY DIFFICULT OR IMPOSSIBLE TO REPLACE
EXECUTIVE.
ACCORDINGLY, EXECUTIVE AGREES THAT, IN CONSIDERATION OF THIS
AGREEMENT AND THE PAYMENTS TO BE RECEIVED BY HER HEREUNDER, FROM AND AFTER THE
DATE HEREOF THROUGH THE PERIOD DURING WHICH EXECUTIVE CONTINUES TO BE EMPLOYED
BY THE COMPANY AND FOLLOWING TERMINATION OF EXECUTIVE'S EMPLOYMENT FOR ANY
REASON UNTIL THE FIRST ANNIVERSARY OF SUCH TERMINATION OF EMPLOYMENT (THE
"NON-COMPETITION PERIOD"), EXECUTIVE SHALL NOT, DIRECTLY OR INDIRECTLY, OWN,
MANAGE, OPERATE, JOIN, CONTROL OR PARTICIPATE IN THE OWNERSHIP, MANAGEMENT,
OPERATION OR CONTROL OF, OR BE CONNECTED AS A DIRECTOR, OFFICER, EMPLOYEE,
PARTNER, LENDER, CONSULTANT OR OTHERWISE ("PARTICIPATE" OR A "PARTICIPATION")
WITH ANY COMPETITOR (AS HEREINAFTER DEFINED), EXCEPT WITH THE COMPANY'S PRIOR
WRITTEN CONSENT.
FOR PURPOSES OF THIS AGREEMENT, THE TERM "COMPETITOR" SHALL
MEAN ANY ENTITY ENGAGED IN THE BUSINESS OF PROVIDING PROPERTY MONITORING
SERVICES WITH REVENUE IN EXCESS OF ONE HUNDRED SIXTY MILLION DOLLARS
($160,000,000) DURING THE MOST RECENT TWELVE (12) MONTH PERIOD FOR WHICH
FINANCIAL STATEMENTS ARE AVAILABLE, INCLUDING WITHOUT LIMITATION, ADT SECURITY
SERVICES, BRINK'S HOME SECURITY, INC., THE STANLEY WORKS, SIEMENS A.G., UNITED
TECHNOLOGIES, INC. AND THEIR RESPECTIVE SUBSIDIARIES, AFFILIATES AND
SUCCESSORS.
NOTHING IN THIS SECTION SHALL PROHIBIT