Document:

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                              EMPLOYMENT AGREEMENT

         EMPLOYMENT AGREEMENT (this "Agreement") made as of the 1st day of June,
2000 by and between Barry Halpern (hereinafter referred to as "Employee") and
DUALSTAR TECHNOLOGIES CORPORATION, a Delaware corporation having its principal
place of business at 11-30 47th Avenue, Long Island City, New York 11101
(hereinafter referred to as the "Company").

         1. Employment. The Company hereby employs Employee and Employee agrees
to work for the Company with the title specified on Schedule A below during the
Term (as defined below) of and upon the terms and conditions set forth in this
Agreement.

         2. Compensation/Benefits. (a) Base Salary. During the Term of this
Agreement, the Company agrees to pay Employee the base annual salary specified
on Schedule A below ("Base Salary"). Such Base Salary shall be reviewed no less
frequently than annually during the term of this Agreement and may be increased
but not decreased by the Company's board of directors in its sole and absolute
discretion, after taking into consideration a variety of factors, including,
without limitation, the performance of the Employee and the Company and the base
salary (and raises) paid by comparable companies to employees having comparable
responsibilities. In the event of any increase, the increased amount shall
become the Base Salary. Such Base Salary shall be payable in accordance with the
Company's normal business practices or in such other amounts and at such other
times as the parties may mutually agree.

         (b) Bonuses. On account of each year of the Term of this Agreement, the
Company agrees to pay to Employee a bonus equal to 10% (ten percent) of the net
income before taxes of the Company's High-Rise Electric subsidiary, calculated
in a manner consistent with past practices and GAAP.

         (c) Benefits/Vacation. During the Term of this Agreement, the Company
also shall provide Employee with such other benefits, including medical,
disability, pension and severance plans, as are made generally available to
executive employees of the Company from time to time. Employee shall be entitled
to three weeks as vacation and such personal and sick benefit days during each
year of the Term in accordance with standard Company policies.

         (d) Life Insurance. Subject to Employee's submitting to any required
physical examinations, the Company shall purchase and maintain in effect a term
insurance policy with a face amount of one times Employee's Base Salary or other
greater amount as may be specified in the Company's executive benefit policies
or plans on the life of Employee and shall permit Employee to designate the
beneficiary thereof.

         3. Services. Employee agrees to devote substantially all of his working
time, attention and energies to the business of the Company and its Affiliates
under the general direction of the President and Chief Executive Officer and the
Company's board of directors acting through its Chairman. Nothing herein shall
be interpreted to preclude Employee from participating as an officer or director
of, or advisor to, any charitable or other tax exempt or civic organization.

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                                       2

         4. Term. The term of this Agreement (the "Term" or the "Term of this
Agreement") shall commence on April 1, 2000 and shall continue through the Date
of Termination, as hereinafter defined. Agreement to expire on July 1, 2002.

         5. Early Termination. (a) In General. The Employee's employment
hereunder shall terminate and, other than the obligations listed in Paragraph
5(b), the Company's obligations hereunder shall cease, including the obligation
to pay compensation for any period after the date of termination on the Date of
Termination. The Date of Termination shall be (i) in the case of the death of
the Employee, the date of death; (ii) in the case of a termination by Employee,
the last date to be worked as specified in a written notice delivered by
Employee to the Company, which shall be not less than two weeks following the
date that such notice is given; (iii) in the case of a termination by the
Company other than for Cause (as defined below), the date set forth in a written
notice delivered by the Company to Employee, which date shall be not less than
two weeks following upon written notice following the date that such notice is
given; or (iv) in the case of a termination by the Company for Cause (as defined
below), the date upon which written notice of such termination is delivered to
Employee.

         "Cause" shall mean that the Employee has acted with willful misconduct
or gross negligence in connection with the performance of his duties hereunder,
which conduct has materially injured the Company, or has been convicted of, or
entered a plea of nolo contendere to, a felony. Upon the Date of Termination,
the Term of this Agreement shall expire. Notwithstanding the foregoing, the
Employee shall not be deemed to have been terminated for Cause arising out of an
act of willful misconduct or gross negligence without (a) no less than ten (10)
days prior written notice to the Employee setting for the reasons for the
Company's intention to terminate for Cause, (b) an opportunity for the Employee
to be heard (together with comments of counsel) before the Board of Directors of
the Company, and (c) delivery to the Employee of a notice of termination from
the Board of Directors of the Company stating its opinion that the Employee has
acted with willful misconduct or gross negligence and specifying the particulars
thereof.

         (b) Payments Upon Termination. (i) Upon termination of this Agreement
for any reason, Employee shall be entitled to all compensation and benefits
earned but not yet paid up to and including the termination date, including Base
Salary, pro rata bonus, if any, in the year of termination (payable in
accordance with Company policy), and any other incentive compensation. Unless
otherwise specified in this Agreement, unused vacation shall be treated in
accordance with Company policy.

         (ii) In the event of Employee's (A) termination of employment or this
Agreement by the Company other than for Cause, or (B) termination of employment
by Employee for "Good Reason" (as defined below), in addition to the Company's
obligations set forth in subparagraph (i) above, Employee shall be entitled to
severance in an amount equal to one full year of Base Salary (the "Severance
Amount"), all unvested Options then held by Employee shall immediately vest and
Employee shall retain all rights to the Options, but shall have a period of nine
(9) months following the Date of Termination in which to exercise such Options,
in accordance with the option agreement governing such options (the "Option
Agreement"), and Employee shall continue to receive employee benefits for a
period of six months following the

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                                       3

Date of Termination and the Employee's eligible dependents will continue to
participate in all of Company's health and welfare plans (or Company-provided
equivalent benefits) in which such dependents participated prior to the Date of
Termination, subject to the Employee continuing to make any required
contributions for such participation. Following such 6-month period, Employee
shall be entitled to all benefits ordinarily accorded terminated employees of
the Company. The Company's obligation to make the foregoing employee benefits
available to Employee and his eligible dependents shall cease upon Employee
becoming eligible for comparable benefits from a subsequent employer. Effective
upon the Date of Termination pursuant to clause (A) or (B) above, in
consideration of the payment of the Severance Amount and as a condition to the
payment thereof, Employee acknowledges that payment of the Severance Amount and
the provision of the other benefits contemplated hereby shall constitute
complete satisfaction of all obligations owed by the Company to the Employee and
shall further constitute Employee's sole remedy against the Company.

         (iii) In the event of a termination by Employee other than for Good
Reason, in addition to the Company's obligations set forth in subparagraph (i)
above, Employee shall retain that portion of the Options which have vested prior
to the Date of Termination, but shall have a period of ninety (90) days from the
Date of Termination in which to exercise such Options. In the event of a
termination by the Company for Cause, the provisions of Section 5(f) below shall
govern.

         (iv) In the event of a termination of employment by reason of
Employee's death or disability, in addition to the Company's obligations set
forth in subparagraph (i) above, all unvested Options then held by Employee (or
his estate, if applicable) shall immediately vest and Employee (or his estate)
shall retain all rights to the Options, but shall have a period of eighteen (18)
months from the Date of Termination in which to exercise such Options.

         (c) Method of Payment. The Company shall pay the Severance Amount in a
lump sum not later than ten (10) days after the Employee's last day of active
employment (the "Effective Date"), provided, however, that at Employee's option,
the Severance Amount shall be payable to Employee in the form of equal periodic
payments ("Deferred Payment") according to the Company's regular payroll
schedule or at any other intervals elected by Employee for a period commencing
on the first regular payroll pay date beginning after the Effective Date (the
"Deferred Payment Period"). In order to receive Deferred Payment during a
Deferred Payment Period, Employee must elect such Deferred Payment in writing
and specify the Deferred Payment Period, which may not exceed the number of
months of Base Monthly Salary payable to Employee as the Severance Amount. In
the event of Employee's death during the Deferred Payment Period, any unpaid
Deferred Payment shall be paid in a lump sum to such beneficiary or
beneficiaries designated by Employee in writing or, failing such designation, to
Employee's spouse if Employee is married or to Employee's estate if Employee is
unmarried. In no event shall Employee be required to mitigate his damages
arising out of any termination of this Agreement by the Company or by Employee .

         (d) Good Reason. For purposes of this Agreement, Good Reason shall
mean, with respect to Employee, (i) the assignment to Employee of any duties
materially inconsistent with, or substantially reduced as compared to, those set
forth in Section 1 or Schedule A, excluding for

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                                       4

this purpose an isolated, insubstantial and inadvertent action not taken in bad
faith and that is remedied by the Company promptly after receipt of notice
thereof given by Employee; (ii) any material reduction in Employee's Base
Salary, opportunity to earn annual bonuses or other compensation or employee
benefits, other than as a result of an isolated and inadvertent action not taken
in bad faith and that is remedied by the Company promptly after receipt of
notice thereof given by Employee; (iii) the Company's requiring Employee to
relocate his principal place of business to a place that is not within a 30-mile
radius of Long Island City, NY, (iv) any purported termination of this Agreement
by the Company otherwise than as expressly permitted by this Agreement, or (v) a
"Change of Control" of High-Rise Electric. For purposes hereof, a "Change of
Control" of the Company shall be deemed to have occurred if, after the date
hereof, (i) any person or two or more persons acting in concert, other than the
Company, any employee benefit plan sponsored by the Company, Cerberus Capital
Management, L.P., Blackacre Capital Management LLC, Technology Investors Group,
LLC or any of their Affiliates, acquires beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as
amended (the "'34 Act") directly or indirectly of fifty percent (50%) or more of
the total voting power represented by the Company's then outstanding voting
securities (calculated as provided in paragraph (d) of Rule 13d-3 under the '34
Act in the case of rights to acquire voting securities); or (ii) any person or
two or more persons acting in concert, other than the Company, any employee
benefit plan sponsored by the Company, Cerberus Capital Management, L.P,
Blackacre Capital Management LLC, Technology Investors Group, LLC or any of
their Affiliates, shall purchase shares of the Company pursuant to a tender
offer or exchange offer to acquire any voting securities of the Company (or
securities convertible into such voting securities) for cash, securities or any
other consideration, provided that after the consummation of the offer, the
person or persons in question has beneficial ownership directly or indirectly of
fifty percent (50%) or more of the total voting power represented by the
Company's then outstanding voting securities (all as calculated under clause (i)
above)); or (iii) the stockholders of the Company shall approve (A) any
consolidation or merger of the Company in which the Company is not the
continuing or surviving corporation (other than a merger of the Company in which
holder of the Common Shares of the Company immediately prior to the merger have
the same proportionate ownership of common stock of the surviving corporation
immediately after the merger as immediately before), or pursuant to which Common
Shares of the Company would be converted into cash, securities or other
property, or (B) any sale, lease, exchange or other transfer (in one transaction
or a series of related transactions) of all or substantially all of the assets
of the Company, other than a sale, lease, exchange or other transfer of all or
substantially all assets of the Company to Cerberus Capital Management, L.P.,
Blackacre Capital Management, LLC, Technology Investors Group, LLC or any of
their affiliates; or (iv) a change in control of a nature that would be required
to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A
promulgated under the '34 Act, whether or not the Company is then subject to
such reporting requirement; or (v) there shall have been a change in the
composition of the Board of Directors of the Company at any time during any
consecutive twenty-four (24) month period such that "continuing directors" cease
for any reason to constitute at least a 70% majority of the Board. For purposes
of this clause, "continuing directors" means those members of the Board who
either were directors at the beginning of such twenty-four month period or were
elected by or on the nomination or recommendation of at least a 70% majority of
the then-existing "continuing directors." So long as there has not been a
"change of control" within the meaning of clause (v), the Board of Directors may
adopt by a 70% majority

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                                       5

of the "continuing directors" a resolution to the effect that an event described
in clauses (i) or (ii) shall not constitute a "change of control."

         (e) Disability. If Employee shall become unable efficiently to perform
the essential functions of his job, even with reasonable accommodation, as a
result of a disability or illness, as such terms are defined by the Americans
with Disabilities Act, he shall be entitled to his regular compensation until
the total period of disability or illness (whether or not continuous and whether
or not the same disability or illness) shall exceed 60 days during any calendar
year in the Term hereunder. This Agreement may thereafter be terminated by the
Company and, subject to the terms of paragraph (b) above, the Company's
obligations hereunder shall cease, including the obligation to pay compensation
for any period after the Date of Termination. Any amounts payable as
compensation during the period of disability or illness, shall be reduced by any
amounts paid during such period under any disability plan or similar insurance
maintained by the Company for Employee's benefit.

         (f) Cause. Upon a termination for Cause, Employee shall receive Base
Salary through the Date of Termination, and all other entitlement to benefits or
bonuses shall cease immediately, and all stock options not yet fully vested and
exercised shall be forfeited. Employee shall retain that portion of the Options
that have vested prior to the Date of Termination for Cause, but shall have a
period of 90 days from the Date of Termination in which to exercise such
Options.

         (g) Change of Control. As used herein, a "Change of Control" of the
Company shall be deemed to have occurred if, after the date hereof, (i) any
person or two or more persons acting in concert, other than the Company, any
employee benefit plan sponsored by the Company, Cerberus Capital Management,
L.P., Blackacre Capital Management LLC, Technology Investors Groups, LLC or any
of their Affiliates, acquires beneficial ownership (within the meaning of Rule
13d-3 promulgated under the Securities Exchange Act of 1934, as amended (the
"'34 Act") directly or indirectly of fifty percent (50%) or more of the total
voting power represented by the Company's then outstanding voting securities
(calculated as provided in paragraph (d) of Rule 13d-3 under the '34 Act in the
case of rights to acquire voting securities); or (ii) any person or two or more
persons acting in concert, other than the Company, any employee benefit plan
sponsored by the Company, Cerberus Capital Management, L.P, Blackacre Capital
Management LLC, Technology Investors Group, LLC or any of their Affiliates,
shall purchase shares of the Company pursuant to a tender offer or exchange
offer to acquire any voting securities of the Company (or securities convertible
into such voting securities) for cash, securities or any other consideration,
provided that after the consummation of the offer, the person or persons in
question has beneficial ownership directly or indirectly of fifty percent (50%)
or more of the total voting power represented by the Company's then outstanding
voting securities (all as calculated under clause (i) above)); or (iii) the
shareholders of the Company shall approve (A) any consolidation or merger of the
Company in which the Company is not the continuing or surviving corporation
(other than a merger of the Company in which holder of the Common Shares of the
Company immediately prior to the merger have the same proportionate ownership of
common stock of the surviving corporation immediately after the merger as
immediately before), or pursuant to which Common Shares of the Company would be
converted into cash, securities or other property, or (B) any sale, lease,
exchange or other transfer (in one transaction

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                                       6

or a series of related transactions) of all or substantially all of the assets
of the Company, other than a sale, lease, exchange or other transfer of all or
substantially all assets of the Company to Cerberus Capital Management, L.P.,
Blackacre Capital Management, LLC, Technology Investors Group, LLC or any of
their affiliates; or (iv) a change in control of a nature that would be required
to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A
promulgated under the '34 Act, whether or not the Company is then subject to
such reporting requirement; or (v) there shall have been a change in the
composition of the Board of Directors of the Company at any time during any
consecutive twenty-four (24) month period such that "continuing directors" cease
for any reason to constitute at least a 70% majority of the Board. For purposes
of this clause, "continuing directors" means those members of the Board who
either were directors at the beginning of such twenty-four month period or were
elected by or on the nomination or recommendation of at least a 70% majority of
the then-existing "continuing directors." So long as there has not been a
"change of control" within the meaning of clause (v), the Board of Directors may
adopt by a 70% majority of the "continuing directors" a resolution to the effect
that an event described in clauses (i) or (ii) shall not constitute a "change of
control."

         6. Employer's Authority. Employee agrees to observe and comply with the
rules and regulations of the Company as adopted by the Company's board of
directors respecting the performance of his duties and to carry out and perform
orders, directions and policies communicated to him from time to time,
consistent with his position and with past practices.

         7. Expenses. During the Term of this Agreement, the Company shall
reimburse Employee for the reasonable business expenses incurred by Employee in
the course of performing his duties for the Company hereunder in accordance with
the procedures then in place for such reimbursement.

         8. Non-Disclosure and Non-Competition. Employee has executed a
Nondisclosure Agreement of the Company attached hereto as Exhibit 1. In
addition, during the Term and for a further period of one year thereafter,
Employee shall not participate, without the written consent of the Company, in
the management or control of, or act as an employee or officer of, any business
operation which engages in any activity which is primarily engaged in or
competes significantly with the material telecommunications businesses conducted
by the Company and High Rise Electric or any of its Affiliates (the
"Companies"). Such covenant shall apply within all territories in which the
Companies are actively engaged in business or are actively soliciting business.
The parties agree that if any portion of this Paragraph 8 shall be deemed by any
court or agency to be unreasonable and/or unenforceable, then it shall be
modified to the extent necessary to make it enforceable by such court or agency.

         9. Survival. The last sentence of Paragraph 5(b)(ii), Paragraph 8 and
Paragraph 14 of this Agreement shall survive termination of employment hereunder
and of this Agreement.

         10. Execution, Delivery and Performance. To the best of Employee's
knowledge, the execution, delivery and performance by Employee of this Agreement
or any other agreement, instrument or document contemplated herein or hereby
will not result in a breach of or conflict with any terms of any other
agreement, instrument or document to which Employee is a party or by which
Employee or his property is bound. No consent or approval of any person or
entity,

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                                       7

other than those that have been obtained by Employee, is required for Employee
to execute, deliver and perform its obligations under this Agreement or any
agreement, instrument or document contemplated herein or hereby.

         11. Notices. Any notice permitted or required hereunder shall be deemed
sufficient when hand-delivered or mailed by certified mail, postage prepaid, and
addressed if to the Company at the address indicated above and if to the
Employee at the address indicated below (or to such other address as may be
provided by written notice received at least five (5) business days prior to the
hand delivery or mailing of any such notice).

         12. Miscellaneous. (a) This Agreement (i) constitutes the entire
agreement between the parties concerning the subjects hereof and supersedes any
and all prior agreements or understandings, (ii) may not be assigned by Employee
without the prior written consent of the Company, and (iii) may be assigned by
the Company to any Affiliate of the Company or to the successors or assigns of
the Company, provided such successors or assigns carry on substantially the
Company's telecommunications business as conducted at the time of assignment and
shall be binding upon, and inure to the benefit of, any such Affiliate,
successor or assign.

         (b) Headings herein are for convenience of reference only and shall not
define, limit or interpret the contents hereof.

         (c) As used herein, the term "Affiliate" shall mean any entity
controlled by or under common control with another person.

         13. Amendment. This Agreement may be amended, modified or supplemented
by the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective.

         14. Specific Enforcement. The parties acknowledge that the Company
would be irreparably damaged and there would be no adequate remedy at law for
the Employee's breach of Paragraph 8 of this Agreement, and accordingly, the
terms thereof shall be specifically enforced. Employee hereby consents to the
entry of any temporary restraining order or preliminary injunction, in addition
to any other remedies available at law or in equity, to enforce the provisions
hereof, provided sufficient facts are shown to warrant such relief. In the event
that any action is brought to enforce Paragraph 8 hereof, the prevailing party
shall be entitled to recover its costs and attorneys fees in addition to any
other relief granted.

         15. Severability. The provisions of this Agreement are severable. The
invalidity of any provision shall not affect the validity of any other
provision.

         16. Governing Law; Arbitration. This Agreement shall be construed and
regulated in all respects under the laws of the State of New York without regard
to its conflict of laws principles. Any dispute, controversy or questions
arising under, out of, or relating to this Agreement of Employee's employment
with the Company or termination thereof, shall be referred for arbitration in
the State of New York to a single neutral arbitrator selected by the Employee
and Company and this shall be the exclusive and sole means of resolving any such

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                                       8

dispute. The arbitration proceeding shall be governed by the Employment Rules of
the American Arbitration Association then in effect or such rules last in effect
(in the event such Association is no longer in existence) but shall not be
conducted under the auspices of the Association, and the decision of the
arbitrator shall be governed by the rule of law. If the parties are unable to
agree upon a neutral arbitrator within thirty (30) days after each party has
given the other written notice of the desire to submit a dispute, controversy or
question for decision as aforesaid, then either party may apply to the CPR of
New York City for the appointment of a neutral arbitrator or, if the CPR is not
then in existence or does not desire to act in the matter, either party may
apply to the Presiding Judge of the appropriate court for the appointment of a
neutral arbitrator to hear the parties and settle the dispute, controversy or
question. Such right to submit a dispute, controversy or question arising
hereunder to arbitration and the decision of the neutral arbitrator shall be
final, conclusive and binding on all parties and interested persons and no
action at law or in equity shall be instituted or, if instituted, further
prosecuted by either party other than to enforce the award of the neutral
arbitrator. The arbitrator shall take submissions and hear testimony, if
necessary, and shall render a written decision as promptly as possible, The
arbitrator may require any form of discovery (e.g., depositions) in making his
decision. In connection with any arbitration, the prevailing party shall be
entitled to recover its costs and reasonable attorneys' fees in addition to
other relief granted.

         IN WITNESS WHEREOF, this Agreement is entered into as of the date and
year first above written.

DUALSTAR TECHNOLOGIES                          EMPLOYEE:
  CORPORATION

By:     /s/                                    /s/
Name:   Gregory Cuneo                          Name: Barry Halpern
Title:  President & CEO

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                                       9

                                   SCHEDULE A

                  Name:                      Barry Halpern

                  Title:                    President, High-Rise Electric

                  Base Salary:              $260,000

                  Home Address:
                                            -----------------------------<PAGE>

                              EMPLOYMENT AGREEMENT

     EMPLOYMENT AGREEMENT (this "Agreement") made as of the 17th day of March,
2000 by and between Peter P. Sach (hereinafter referred to as "Employee") and
DUALSTAR COMMUNICATIONS, INC., a Delaware corporation having an office for the
conduct of business at One Park Avenue, New York, New York 10016 (hereinafter
referred to as the "Company").

     1. Employment. The Company hereby employs Employee and Employee agrees to
work for the Company with the title specified on Schedule A below during the
Term (as defined below) of and upon the terms and conditions set forth in this
Agreement.

     2. Compensation/Benefits. (a) Base Salary. During the Term of this
Agreement, the Company agrees to pay Employee the base annual salary specified
on Schedule A below ("Base Salary"). Such Base Salary shall be reviewed no less
frequently than annually during the term of this Agreement and may be increased,
but not decreased, by the Company's board of directors in its sole and absolute
discretion, after taking into consideration a variety of factors, including,
without limitation, the performance of the Employee and the Company and the base
salary (and raises) paid by comparable companies to senior officers having
comparable responsibilities. The parties acknowledge that the Company is not
required to increase Employee's salary, however, in the event that an increase
is approved, such increase shall be no less than 5% of the then Base Salary, and
in the event of any increase, the increased amount shall become the Base Salary.
Such Base Salary shall be payable in accordance with the Company's normal
business practices or in such other amounts and at such other times as the
parties may mutually agree.

     (b) Bonuses. During each year of the Term of this Agreement, the Company
agrees to submit for approval to the Board of Directors, in its sole and
absolute discretion, an incentive payment plan ("IPP"), which shall establish
performance targets for the Company and/or its business units, and bonus
payments based upon the achievement of such performance targets. The Company
agrees that the Employee shall participate in such IPP at a target bonus of 50%
of Base Salary, based upon 100% achievement of the performance targets
established in the IPP. The target bonus percentage shall be reviewed no less
frequently than annually during the term of this Agreement and may be increased
but not decreased by the Company's board of directors in its sole and absolute
discretion. In establishing performance targets and target bonus percentages for
the Employee, the Company will consider a variety of factors, including, without
limitation, performance targets set for, and bonus payments paid to, senior
officers having comparable responsibilities at comparable companies.

     (c) Benefits/Vacation. During the Term of this Agreement, the Company also
shall provide Employee with such other benefits, including medical, disability,
pension and severance plans, as are made generally available to executive
employees of the Company from time to time. Employee shall be entitled to four
weeks as vacation and such personal and sick benefit days during each year of
the Term in accordance with standard Company policies.

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                                       2

     (d) Life Insurance. Subject to Employee's submitting to any required
physical examinations, the Company shall purchase and maintain in effect a term
insurance policy with a face amount of one times Employee's Base Salary or other
greater amount as may be specified in the Company's executive benefit policies
or plans on the life of Employee and shall permit Employee to designate the
beneficiary thereof.

     (e) Stock Options. The Company shall recommend to the Compensation and
Governance Committee of the DualStar Technologies Corporation Board of Directors
to issue to Employee stock options (the "Options") to purchase up to 375,000
shares of the Company's common stock at an exercise price of $7.06 per share.
The Options will be granted pursuant to the DualStar Technologies Corporation
1994 Stock Option Plan and shall vest as follows:

         (i)   one-third of the Options will vest upon execution of this
               Agreement;

         (ii)  two-thirds of the Options will vest ratably on a monthly basis on
               the last day of each of the 24 calendar months following the
               first anniversary of the date hereof.

All unvested Options shall vest in their entirety upon a Change of Control
(defined below) of the Company. Employee acknowledges that DualStar is seeking
approval to increase the number of shares available for grant under the 1994
Stock Option Plan from its stockholders, as soon as practicable but in no event
later than the next annual meeting of stockholders of DualStar. To the extent
that the DualStar stockholders do not approve the increase, DualStar will
provide Employee with the economic benefits of the Options, on the same terms
and conditions set forth herein.

     (f) Relocation Expenses. The Employee's primary office shall be located at
One Park Avenue, New York, New York; provided, that the Employee's primary
office may be relocated by the Company in connection with the anticipated
relocation of the Company's headquarters to a location in the metropolitan New
York area. Upon presentation of appropriate documentation and receipts, the
Company shall reimburse Employee for all reasonable out-of-pocket expenses
incurred in relocating his primary residence from Colorado to the metropolitan
New York area, up to a maximum of $75,000 in total (the "Relocation Allowance").
Prior to Employee's relocation, the Company agrees to provide Employee with a
reasonable accommodations (i.e., provision of a furnished apartment and payment
of reasonable utilities expenses) in the metropolitan New York area for up to
one year from the date hereof. Within 60 days prior to the one-year anniversary
hereof, the Company and Employee will re-evaluate Employee's relocation to the
New York metropolitan area. To the extent Employee determines not to relocate at
such time, despite the request of the Company to do so, the expenses incurred by
the Company in providing reasonable accommodations to Employee in the
metropolitan New York area from and after the one-year anniversary hereof shall
be deducted from Relocation Allowance.

     3. Services. Employee agrees to devote substantially all of his working
time, attention and energies to the business of the Company and its Affiliates
under the general direction of the President and Chief Executive Officer and the
Company's board of directors

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                                       3

acting through its Chairman. Nothing herein shall be interpreted to preclude
Employee from participating as an officer or director of, or advisor to, any
charitable or other tax exempt or civic organization.

     4. Term. The term of this Agreement (the "Term" or the "Term of this
Agreement") shall commence on March 20, 2000 and shall continue through the Date
of Termination, as hereinafter defined.

     5. Early Termination. (a) In General. The Employee's employment hereunder
shall terminate and, other than the obligations listed in Paragraph 5(b), the
Company's obligations hereunder shall cease, including the obligation to pay
compensation for any period after the date of termination on the Date of
Termination. The Date of Termination shall be (i) in the case of the death of
the Employee, the date of death; (ii) in the case of a termination by Employee,
the last date to be worked as specified in a written notice delivered by
Employee to the Company, which shall be not less than two weeks following the
date that such notice is given; (iii) in the case of a termination by the
Company other than for Cause (as defined below), the date set forth in a written
notice delivered by the Company to Employee, which date shall be not less than
two weeks following upon written notice following the date that such notice is
given; or (iv) in the case of a termination by the Company for Cause (as defined
below), the date upon which written notice of such termination is delivered to
Employee.

     "Cause" shall mean a finding by the Company's board of directors that the
Employee has acted with willful misconduct or gross negligence in connection
with the performance of his duties hereunder, which conduct has materially
injured the Company, or has been convicted of, or entered a plea of nolo
contendere to, a felony. Upon the Date of Termination, the Term of this
Agreement shall expire. Notwithstanding the foregoing, the Employee shall not be
deemed to have been terminated for Cause arising out of an act of willful
misconduct or gross negligence without (a) no less than ten (10) days prior
written notice to the Employee setting for the reasons for the Company's
intention to terminate for Cause, (b) an opportunity for the Employee to be
heard (together with comments of counsel) before the Board of Directors of the
Company, and (c) delivery to the Employee of a notice of termination from the
Board of Directors of the Company stating its opinion that the Employee has
acted with willful misconduct or gross negligence and specifying the particulars
thereof.

     (b) Payments Upon Termination. (i) Upon termination of this Agreement for
any reason, Employee shall be entitled to all compensation and benefits earned
but not yet paid up to and including the termination date, including Base
Salary, pro rata bonus, if any, in the year of termination (payable in
accordance with Company policy), and any other incentive compensation. Unless
otherwise specified in this Agreement, unused vacation shall be treated in
accordance with Company policy.

     (ii) In the event of Employee's (A) termination of employment or this
Agreement by the Company other than for Cause, or (B) termination of employment
by Employee for "Good Reason" (as defined below), in addition to the Company's
obligations set forth in subparagraph (i) above, Employee shall be entitled to
severance in an amount equal to one full years of Base Salary (the "Severance
Amount"), all unvested Options then held by Employee shall

<PAGE>

                                       4

immediately vest and Employee shall retain all rights to the Options, but shall
have a period of nine (9) months following the Date of Termination in which to
exercise such Options, in accordance with the option agreement governing such
options (the "Option Agreement"), and Employee shall continue to receive
employee benefits for a period of twelve months following the Date of
Termination and the Employee's eligible dependents will continue to participate
in all of Company's health and welfare plans (or Company-provided equivalent
benefits) in which such dependents participated prior to the Date of
Termination, subject to the Employee continuing to make any required
contributions for such participation. Following such 12-month period, Employee
shall be entitled to all benefits ordinarily accorded terminated employees of
the Company. The Company's obligation to make the foregoing employee benefits
available to Employee and his eligible dependents shall cease upon Employee
becoming eligible for comparable benefits from a subsequent employer. Effective
upon the Date of Termination pursuant to clause (A) or (B) above, in
consideration of the payment of the Severance Amount and as a condition to the
payment thereof, Employee acknowledges that payment of the Severance Amount and
the provision of the other benefits contemplated hereby shall constitute
complete satisfaction of all obligations owed by the Company to the Employee and
shall further constitute Employee's sole remedy against the Company.

     (iii) In the event of a termination by Employee other than for Good Reason,
in addition to the Company's obligations set forth in subparagraph (i) above,
Employee shall retain that portion of the Options which have vested prior to the
Date of Termination, but shall have a period of ninety (90) days from the Date
of Termination in which to exercise such Options. In the event of a termination
by the Company for Cause, the provisions of Section 5(f) below shall govern.

     (iv) In the event of a termination of employment by reason of Employee's
death or disability, in addition to the Company's obligations set forth in
subparagraph (i) above, all unvested Options then held by Employee (or his
estate, if applicable) shall immediately vest and Employee (or his estate) shall
retain all rights to the Options, but shall have a period of eighteen (18)
months from the Date of Termination in which to exercise such Options.

     (c) Method of Payment. The Company shall pay the Severance Amount in a lump
sum not later than ten (10) days after the date the Company selects as
Employee's last day of active employment (the "Effective Date"), provided,
however, that at Employee's option, the Severance Amount shall be payable to
Employee in the form of equal periodic payments ("Deferred Payment") according
to the Company's regular payroll schedule or at any other intervals elected by
Employee for a period commencing on the first regular payroll pay date beginning
after the Effective Date (the "Deferred Payment Period"). In order to receive
Deferred Payment during a Deferred Payment Period, Employee must elect such
Deferred Payment in writing and specify the Deferred Payment Period, which may
not exceed the number of months of Base Monthly Salary payable to Employee as
the Severance Amount. In the event of Employee's death during the Deferred
Payment Period, any unpaid Deferred Payment shall be paid in a lump sum to such
beneficiary or beneficiaries designated by Employee in writing or, failing such
designation, to Employee's spouse if Employee is married or to Employee's estate
if Employee is unmarried. In no event shall Employee be required to mitigate his
damages arising out of any termination of this Agreement by the Company or by
Employee.

<PAGE>

                                       5

     (d) Good Reason. For purposes of this Agreement, Good Reason shall mean,
with respect to Employee, (i) the assignment to Employee of any duties
materially inconsistent with, or substantially reduced as compared to, those set
forth in Section 1 or Schedule A, excluding for this purpose an isolated,
insubstantial and inadvertent action not taken in bad faith and that is remedied
by the Company promptly after receipt of notice thereof given by Employee; (ii)
any reduction in Employee's Base Salary, opportunity to earn annual bonuses or
other compensation or employee benefits, other than as a result of an isolated
and inadvertent action not taken in bad faith and that is remedied by the
Company promptly after receipt of notice thereof given by Employee; (iii) the
Company's requiring Employee to relocate his principal place of business to a
place that is not within a 30-mile radius of New York City, New York, or (iv)
any purported termination of this Agreement by the Company otherwise than as
expressly permitted by this Agreement. The Company has advised Employee that
DualStar Technologies Corporation, the parent corporation of the Company
("DST"), anticipates consummating a series of transactions (the
"Restructuring"), the effect of which will be to divest DST of its mechanical
and electrical lines of business. Following the consummation of such
transactions, the telecommunications business conducted by the Company will be
the primary business of the Company and DST. It is also anticipated that the
Company, or its successor, will have at least one class of its securities
registered under the Securities Exchange Act of 1934, as amended. Employee will
be recommended to serve as the Executive Vice President and Chief Operating
Officer of Company, or its successor. In addition to the foregoing, Good Reason
shall also mean, with respect to Employee, the failure of Employee to be
employed by the Company or its successor as Executive Vice President and Chief
Operating Officer following the Restructuring.

     (e) Disability. If Employee shall become unable efficiently to perform the
essential functions of his job, even with reasonable accommodation, as a result
of a disability or illness, as such terms are defined by the Americans with
Disabilities Act, she shall be entitled to his regular compensation until the
total period of disability or illness (whether or not continuous and whether or
not the same disability or illness) shall exceed 60 days during any calendar
year in the Term hereunder. This Agreement may thereafter be terminated by the
Company and, subject to the terms of paragraph (b) above, the Company's
obligations hereunder shall cease, including the obligation to pay compensation
for any period after the Date of Termination. Any amounts payable as
compensation during the period of disability or illness, shall be reduced by any
amounts paid during such period under any disability plan or similar insurance
maintained by the Company for Employee's benefit.

     (f) Cause. Upon a termination for Cause, Employee shall receive Base Salary
through the Date of Termination, and all other entitlement to benefits or
bonuses shall cease immediately, and all stock options not yet fully vested and
exercised shall be forfeited. Employee shall retain that portion of the Options
that have vested prior to the Date of Termination for Cause, but shall have a
period of 90 days from the Date of Termination in which to exercise such
Options.

     (g) Change of Control. As used herein, For purposes hereof, a "Change of
Control" of the Company shall be deemed to have occurred if, after the date
hereof, (i) any person or two or more persons acting in concert, other than the
Company, any employee benefit plan sponsored

<PAGE>

                                       6

by the Company, Cerberus Capital Management, L.P., Blackacre Capital Management
LLC, Technology Investors Groups, LLC or any of their Affiliates, acquires
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Securities Exchange Act of 1934, as amended (the "'34 Act") directly or
indirectly of fifty percent (50%) or more of the total voting power represented
by the Company's then outstanding voting securities (calculated as provided in
paragraph (d) of Rule 13d-3 under the '34 Act in the case of rights to acquire
voting securities); or (ii) any person or two or more persons acting in concert,
other than the Company, any employee benefit plan sponsored by the Company,
Cerberus Capital Management, L.P., Blackacre Capital Management LLC, Technology
Investors Group, LLC or any of their Affiliates, shall purchase shares of the
Company pursuant to a tender offer or exchange offer to acquire any voting
securities of the Company (or securities convertible into such voting
securities) for cash, securities or any other consideration, provided that after
the consummation of the offer, the person or persons in question has beneficial
ownership directly or indirectly of fifty percent (50%) or more of the total
voting power represented by the Company's then outstanding voting securities
(all as calculated under clause (i) above)); or (iii) the shareholders of the
Company shall approve (A) any consolidation or merger of the Company in which
the Company is not the continuing or surviving corporation (other than a merger
of the Company in which holder of the Common Shares of the Company immediately
prior to the merger have the same proportionate ownership of common stock of the
surviving corporation immediately after the merger as immediately before), or
pursuant to which Common Shares of the Company would be converted into cash,
securities or other property, or (B) any sale, lease, exchange or other transfer
(in one transaction or a series of related transactions) of all or substantially
all of the assets of the Company, other than a sale, lease, exchange or other
transfer of all or substantially all assets of the Company to Cerberus Capital
Management, L.P., Blackacre Capital Management, LLC, Technology Investors Group,
LLC or any of their affiliates; or (iv) a change in control of a nature that
would be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the '34 Act, whether or not the Company is then
subject to such reporting requirement; or (v) there shall have been a change in
the composition of the Board of Directors of the Company at any time during any
consecutive twenty-four (24) month period such that "continuing directors" cease
for any reason to constitute at least a 70% majority of the Board. For purposes
of this clause, "continuing directors" means those members of the Board who
either were directors at the beginning of such twenty-four month period or were
elected by or on the nomination or recommendation of at least a 70% majority of
the then-existing "continuing directors." So long as there has not been a
"change of control" within the meaning of clause (v), the Board of Directors may
adopt by a 70% majority of the "continuing directors" a resolution to the effect
that an event described in clauses (i) or (ii) shall not constitute a "change of
control."

     6. Employer's Authority. Employee agrees to observe and comply with the
rules and regulations of the Company as adopted by the Company's board of
directors respecting the performance of his duties and to carry out and perform
orders, directions and policies communicated to him from time to time,
consistent with his position as Executive Vice President and Chief Operating
Officer.

     7. Expenses. During the Term of this Agreement, the Company shall reimburse
Employee for the reasonable business expenses incurred by Employee in the course
of

<PAGE>
                                       7

performing him duties for the Company hereunder in accordance with the
procedures then in place for such reimbursement. In addition, the Company shall
reimburse Employee for reasonable fees and expenses incurred by him in
connection with the negotiation of this Agreement.

     8. Automobile Allowance. During the Term of this Agreement, Employee shall
be entitled to an automobile allowance as specified on Schedule A below, payable
monthly in arrears.

     9. Non-Disclosure and Non-Competition. Employee has executed a
Nondisclosure Agreement of the Company attached hereto as Exhibit 1. In
addition, during the Term and for a further period of one year thereafter,
Employee shall not participate, without the written consent of the Company, in
the management or control of, or act as an employee or officer of, any business
operation which engages in any activity which is primarily engaged in or
competes significantly with the material telecommunications businesses conducted
by the Company or any of its Affiliates (the "Companies"). Such covenant shall
apply within all territories in which the Companies are actively engaged in
business or are actively soliciting business. The parties agree that if any
portion of this Paragraph 9 shall be deemed by any court or agency to be
unreasonable and/or unenforceable, then it shall be modified to the extent
necessary to make it enforceable by such court or agency.

     10. Survival. The last sentence of Paragraph 5(b)(ii), Paragraph 9 and
Paragraph 15 of this Agreement shall survive termination of employment hereunder
and of this Agreement.

     11. Execution, Delivery and Performance. To the best of Employee's
knowledge, the execution, delivery and performance by Employee of this Agreement
or any other agreement, instrument or document contemplated herein or hereby
will not result in a breach of or conflict with any terms of any other
agreement, instrument or document to which Employee is a party or by which
Employee or his property is bound. No consent or approval of any person or
entity, other than those that have been obtained by Employee, is required for
Employee to execute, deliver and perform its obligations under this Agreement or
any agreement, instrument or document contemplated herein or hereby.

     12. Notices. Any notice permitted or required hereunder shall be deemed
sufficient when hand-delivered or mailed by certified mail, postage prepaid, and
addressed if to the Company at the address indicated above and if to the
Employee at the address indicated below (or to such other address as may be
provided by written notice received at least five (5) business days prior to the
hand delivery or mailing of any such notice).

     13. Miscellaneous. (a) This Agreement (i) constitutes the entire agreement
between the parties concerning the subjects hereof and supersedes any and all
prior agreements or understandings, (ii) may not be assigned by Employee without
the prior written consent of the Company, and (iii) may be assigned by the
Company to any Affiliate of the Company or to the successors or assigns of the
Company, provided such successors or assigns carry on substantially the
Company's telecommunications business as conducted at the time of assignment and
shall be binding upon, and inure to the benefit of, any such Affiliate,
successor or assign.

<PAGE>

                                       8

     (b) Headings herein are for convenience of reference only and shall not
define, limit or interpret the contents hereof.

     (c) As used herein, the term "Affiliate" shall mean any entity controlled
by or under common control with another person.

     14. Amendment. This Agreement may be amended, modified or supplemented by
the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective.

     15. Specific Enforcement. The parties acknowledge that the Company would be
irreparably damaged and there would be no adequate remedy at law for the
Employee's breach of Paragraph 9 of this Agreement, and accordingly, the terms
thereof shall be specifically enforced. Employee hereby consents to the entry of
any temporary restraining order or preliminary injunction, in addition to any
other remedies available at law or in equity, to enforce the provisions hereof,
provided sufficient facts are shown to warrant such relief. In the event that
any action is brought to enforce Paragraph 9 hereof, the prevailing party shall
be entitled to recover its costs and attorneys fees in addition to any other
relief granted.

     16. Severability. The provisions of this Agreement are severable. The
invalidity of any provision shall not affect the validity of any other
provision.

     17. Governing Law; Arbitration. This Agreement shall be construed and
regulated in all respects under the laws of the State of New York without regard
to its conflict of laws principles. Any dispute, controversy or questions
arising under, out of, or relating to this Agreement of Employee's employment
with the Company or termination thereof, shall be referred for arbitration in
the State of New York to a single neutral arbitrator selected by the Employee
and Company and this shall be the exclusive and sole means of resolving any such
dispute. The arbitration proceeding shall be governed by the Employment Rules of
the American Arbitration Association then in effect or such rules last in effect
(in the event such Association is no longer in existence) but shall not be
conducted under the auspices of the Association, and the decision of the
arbitrator shall be governed by the rule of law. If the parties are unable to
agree upon a neutral arbitrator within thirty (30) days after each party has
given the other written notice of the desire to submit a dispute, controversy or
question for decision as aforesaid, then either party may apply to the CPR of
New York City for the appointment of a neutral arbitrator or, if the CPR is not
then in existence or does not desire to act in the matter, either party may
apply to the Presiding Judge of the appropriate court for the appointment of a
neutral arbitrator to hear the parties and settle the dispute, controversy or
question. Such right to submit a dispute, controversy or question arising
hereunder to arbitration and the decision of the neutral arbitrator shall be
final, conclusive and binding on all parties and interested persons and no
action at law or in equity shall be instituted or, if instituted, further
prosecuted by either party other than to enforce the award of the neutral
arbitrator. The arbitrator shall take submissions and hear testimony, if
necessary, and shall render a written decision as promptly as possible, The
arbitrator may require any form of discovery (e.g., depositions) in making his
decision. In

<PAGE>

                                       9

connection with any arbitration, the prevailing party shall be entitled to
recover its costs and reasonable attorneys' fees in addition to other relief
granted.

     IN WITNESS WHEREOF, this Agreement is entered into as of the date and year
first above written.

DUALSTAR COMMUNICATIONS, INC.                EMPLOYEE:

By: /s/                                       /s/
   -----------------------------             ----------------------------------
   Name:  Jill Thoerle                       Name: Peter P. Sach
   Title: President and Chief
            Executive Officer

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