Document:

<PAGE>

                     AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT

     THIS AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT (the "Amendment") is made as
                                                        ---------
of October 31, 2001, by and among CATEGORY 5 TECHNOLOGIES, INC., a Nevada
corporation (the "Company"), and WILLIAM C. GIBBS, an individual ("Executive").
                  -------                                          ---------

                                    RECITALS:

     WHEREAS, on June 1, 2000, Company and Executive entered into that certain
Employment Agreement, a copy of which is attached hereto as Annex I (the
                                                            -------
"Employment Agreement"); and
 --------------------

     WHEREAS, Company and Executive desire to amend the Employment Agreement as
provided in this Amendment to correct a typographical error in Section 2 of the
Employment Agreement.

     NOW, THEREFORE, for good and valuable consideration, the receipt of which
is hereby acknowledged, Company and Executive agree as follows:

     1.   Term. All References to December 31, 2003, in Section 2 shall be
          ----
          deleted and replaced with December 31, 2004.

     2.   No Other Amendment. Except as expressly amended pursuant to this
          ------------------
          Amendment, the terms of the Employment Agreement shall remain in full
          force and effect.

     3.   Counterparts. This Amendment may be executed in one or more
          ------------
          counterparts, each of which shall be deemed an original and all of
          which together shall constitute one and the same document.

     IN WITNESS WHEREOF, the Company and Executive have executed and delivered
this Amendment as of the day and year first above written.

                                      CATEGORY 5 TECHNOLOGIES, INC.
                                      a Nevada corporation

                                      /s/ Mitchell Edwards
                                      ------------------------------------------
                                      Name:  Mitchell Edwards
                                      Title:   President

                                      WILLIAM C. GIBBS
                                      an individual

                                      /s/ William C. Gibbs
                                      ------------------------------------------
                                      William C. Gibbs<PAGE>

                     AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT

     THIS AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT (the "Amendment") is made as
                                                        ---------
of October 31, 2001, by and among CATEGORY 5 TECHNOLOGIES, INC., a Nevada
corporation (the "Company"), and MITCHELL EDWARDS, an individual ("Executive").
                  -------                                          ---------

                                    RECITALS:

     WHEREAS, on June 1, 2000, Company and Executive entered into that certain
Employment Agreement, a copy of which is attached hereto as Annex I (the
"Employment Agreement"); and

     WHEREAS, Company and Executive desire to amend the Employment Agreement as
provided in this Amendment to correct a typographical error in Section 2 of the
Employment Agreement.

     NOW, THEREFORE, for good and valuable consideration, the receipt of which
is hereby acknowledged, Company and Executive agree as follows:

     1.   Term. All References to December 31, 2003, in Section 2 shall be
          ----
          deleted and replaced with December 31, 2004.

     2.   No Other Amendment. Except as expressly amended pursuant to this
          ------------------
          Amendment, the terms of the Employment Agreement shall remain in full
          force and effect.

     3.   Counterparts. This Amendment may be executed in one or more
          ------------
          counterparts, each of which shall be deemed an original and all of
          which together shall constitute one and the same document.

     IN WITNESS WHEREOF, the Company and Executive have executed and delivered
this Amendment as of the day and year first above written.

                                      CATEGORY 5 TECHNOLOGIES, INC.
                                      a Nevada corporation

                                      /s/ William C. Gibbs
                                      ------------------------------------------
                                      Name:  William C. Gibbs
                                      Title:   Chief Executive Officer

                                      MITCHELL EDWARDS
                                      an individual

                                      /s/ Mitchell Edwards
                                      ------------------------------------------
                                      Mitchell Edwards<PAGE>

Neither this Option nor the Common Stock to be issued upon exercise hereof, has
been registered under the Securities Act of 1933, as amended (the "Act"), or
qualified under any state securities law (the "Law"), and this Option has been,
and the Common Stock to be issued upon exercise hereof will be, acquired for
investment and not with a view to, or for resale in connection with, any
distribution thereof. No such sale or other disposition may be made without an
effective registration statement under the Act and qualification under the law
related thereto or an opinion of counsel reasonably satisfactory to Category 5
Technologies, Inc. and its counsel, that said registration and qualifications
are not required under the Act and Law, respectively.

                          CATEGORY 5 TECHNOLOGIES, INC.

                             STOCK OPTION AGREEMENT

     This stock option (the "Option" or the "Agreement") is being granted
pursuant to certain resolutions of the Board of Directors of Category 5
Technologies, Inc., dated August 6, 2001.

I.   NOTICE OF STOCK OPTION GRANT

     Optionee:

     William C. Gibbs

     You have been granted an Option to purchase shares of Common Stock of
Category 5 Technologies, Inc. (the "Company"). This Option shall be subject to
the following terms and conditions:

     Date of Grant:                     August 6, 2001

     Exercise Price Per Share:          $ 0.25

     Number of Shares:                  500,000

     Type of Option:                    Nonqualified Stock Option

     Expiration Date:                   August 6, 2011, unless sooner terminated
                                        as set forth in paragraph 7 herein.

     Exercise Price:
     --------------

     The exercise price of this Option is $ 0.25 per share as may be adjusted
from time as provided below ("Exercise Price").
<PAGE>

     Vesting Schedule:
     ----------------

     This Option may be exercised, in whole or in part, subject to the terms of
this Agreement, in accordance with the following vesting schedule: (i) 1/3 of
the Options at any time after the Date of Grant and prior to the Expiration
Date; (ii) 1/3 of the Options at any time on or after August 6, 2002, and prior
to the Expiration Date; and (iii) 1/3 of the Options at any time on or after
August 6, 2003, and prior to the Expiration Date.

II.  AGREEMENT

     1. Grant Of Option. The Company hereby grants to William C. Gibbs (the
"Optionee"), an option (the "Option") to purchase the number of shares (the
"Shares") as set forth in the Notice of Grant attached as Part I of this
Agreement at the Exercise Price per share set forth in the Notice of Grant,
subject to the terms and conditions set forth herein.

     2. Exercise Of Option.

          (a) Right to Exercise. This Option is exercisable during its term as
              -----------------
     set forth in the Notice of Grant and the applicable provisions of this
     Option Agreement. In the event of Optionee's death, disability or other
     termination of Optionee's employment, the exercisability of the Option is
     governed by the applicable provisions of this Option Agreement.

          (b) Method of Exercise. This Option is exercisable by delivery of an
              ------------------
     exercise notice, in the form attached as Exhibit A (the "Exercise Notice"),
     which shall state the election to exercise the Option, the number of Shares
     in respect of which the Option is being exercised (the "Exercised Shares"),
     and such other representations and agreements as may be required by the
     Company. The Exercise Notice shall be signed by the Optionee and shall be
     delivered in person or by certified mail to the Secretary of the Company.
     The Exercise Notice shall be accompanied by payment of the aggregate
     Exercise Price as to all Exercised Shares. This Option shall be deemed to
     be exercised upon receipt by the Company of such fully executed Exercise
     Notice accompanied by such aggregate Exercise Price.

     3. Method Of Payment. Payment of the aggregate Exercise Price shall be by
any of the following, or a combination thereof, at the election of the Optionee:

          (a) Cash;

          (b) Check;

          (c) In lieu of exercising this Option by delivery of cash or check,
     the Optionee may make a valid Option exercise by electing to receive shares
     equal to the value of this Option (or the portion thereof being canceled)
     by surrendering this Option at the principal office of the Company together
     with the Exercise Notice (a "Net Exercise"), in which event the Company
     shall transfer to the Optionee a number of Shares computed using the
     following formula:

                                       2
<PAGE>

          X      =     Y (A-B)
                    -------------
                         A

Where     X      =  the number of Option Shares to be issued to such Optionee.

          Y      =  the number of Option Shares purchasable by such Optionee
                    under this Option Agreement, the rights to which are
                    surrendered pursuant to the Net Exercise.

          A      =  the Fair Market Value of one Option Share, (as determined by
                    the Closing price of the Company's Common Stock on the
                    trading day immediately preceding the date the Option is
                    exercised, as reported by The Nasdaq National Market or
                    other exchange upon which the Company's stock is quoted).

          B      =  the Exercise Price (as adjusted to the date of such
                    calculation).

     4. Registration Under The Securities Act.

          (a) Demand Rights. Provided that the Company is eligible to file a
              -------------
     registration statement on Form S-3 or Form S-8 (in connection with this
     Option), if at any time after December 31, 2001, the Company shall receive
     from the Optionee a written request that the Company effect a registration
     on Form S-3 or Form S-8 to permit the sale or disposition of the Shares,
     the Company shall file a registration statement on Form S-3 or Form S-8, as
     the case may be, as expeditiously as possible covering the Shares. However,
     the Optionee is limited to only one (1) demand upon the Company to effect a
     registration on Form S-3 or Form S-8 to permit the sale or disposition of
     the Shares (the "Demand Right"), so long as the Form S-3 or Form S-8 first
     demanded remains effective. If such registration statement lapses or
     Optionee is unable to sell all shares covered hereby, this Demand Right
     shall be reinstated so long as Optionee owns any Shares. Once filed, the
     registration statement covering the Shares shall remain current and
     effective until expiration or exercise and sale of all shares subject to
     options herein.

          (b) Duties of Company. In connection with the preparation and filing
              -----------------
     of a registration statement, the Company agrees to (i) use its best efforts
     to cause such registration statement to become and remain effective; (ii)
     furnish to the Optionee such number of copies of a prospectus, including a
     preliminary prospectus, in conformity with the requirements of the
     Securities Act, and such other documents as Optionee may reasonably request
     in order to facilitate the disposition of the Shares; and (iii) use its
     best efforts to register and qualify the shares in such jurisdictions as
     shall be identified by the Optionee for the distribution of the securities
     covered by the registration statement.

          (c) Indemnification by Optionee. To the extent permitted by law,
              ---------------------------
     Optionee will indemnify and hold harmless the Company, and its directors,
     officers, employees, agents and representatives, as well as its controlling
     persons (within the meaning of the Securities Act) against any losses,
     claims, damages, liabilities, or expenses, including without limitation,
     attorneys' fees and disbursements, which arise out of or are based upon any
     violation by

                                       3
<PAGE>

     Optionee of the Securities Act, or any rule or regulation promulgated
     thereunder applicable to Optionee or arise out of or are based upon any
     untrue statement of any material fact contained in the registration
     statement, or arise out of or are based upon the omission or alleged
     omission to state therein a material fact required to be stated therein or
     necessary to make the statements therein not misleading, but only to the
     extent that such untrue statement or alleged untrue statement or omission,
     or alleged omission was made in such registration statement in reliance
     upon and in conformity with information furnished by Optionee in writing
     expressly for use in connection with such registration statement.

          (d) Indemnification by Company. To the extent permitted by law, the
              --------------------------
     Company will indemnify and hold harmless Optionee against any losses,
     claims, damages, liabilities, or expenses, including without limitation
     attorneys' fees and disbursements, to which Optionee may become subject
     under the Securities Act to the extent that such losses, claims, damages or
     liabilities arise out of or are based upon any violation by the Company of
     the Securities Act, or any rule or regulation promulgated thereunder
     applicable to the Company, or arise out of or are based upon any untrue or
     alleged untrue statement of any material fact contained in the registration
     statement, or arise out of or are based upon the omission or alleged
     omission to state therein a material fact required to be stated therein or
     necessary to make the statements therein not misleading, or arise out of
     any violation by the Company of any rule or regulation promulgated under
     the Securities Act applicable to the Company and relating to action or
     inaction of the Company in connection with such registration statement;
     provided, however, that the indemnity agreement contained in this paragraph
     shall not apply to any loss, damage or liability to the extent that same
     arises out of or is based upon an untrue statement or omission made in
     connection with such registration statement in reliance upon and in
     conformity with information furnished in writing expressly for use in
     connection with such registration by Optionee.

          (e) Undertaking by Optionee. Optionee undertakes to comply with all
              -----------------------
     applicable laws governing the distribution of securities in connection with
     Optionee's sale of the Shares, and to notify the Company of any changes in
     Optionee's plan of distribution so that the Company can sticker or amend
     the registration statement as the Company deems appropriate in its sole
     discretion.

     5. Assignability Of Option. This Option may be assigned by the holder upon
the giving of written notice to the Company of (i) the name of the assignee
("Assignee") and (ii) the number of Options assigned to any Assignee.

     Upon any assignment of the Option or portion thereof, the Registration
Rights granted pursuant to Section 4 of this Option Agreement can only be
exercised upon the unanimous written consent of all holders of the Options at
the time the Demand Right is exercised. The terms of this Option Agreement shall
be binding upon the executors, administrators, heirs, successors and assigns of
the Optionee.

     6. Term Of Option. This Option must be exercised within ten (10) years from
the date hereof, and may be exercised during such term only in accordance with
the terms of this Option Agreement.

                                       4
<PAGE>

     7. Termination Of Option. The Option shall terminate under the following
circumstances:

          (a) The Option shall terminate on the Expiration Date;

          (b) If the Optionee dies before the Option terminates pursuant to
     paragraph 7(a), above, the Option shall terminate on the earlier of (i) the
     date on which the Option would have lapsed had the Optionee lived; or (ii)
     15 months after the date of the Optionee's death. Upon the Optionee's
     death, any exercisable Options may be exercised by the Optionee's legal
     representative or representatives, by the person or persons entitled to do
     so under the Optionee's last will and testament, or, if the Optionee shall
     fail to make testamentary disposition of the Option or shall die intestate,
     by the person or persons entitled to receive said Option under the
     applicable laws of descent and distribution.

     8. Acceleration of Vesting of Option. This Option shall vest immediately in
full upon a Change of Control (as herein defined) of the Company. A "Change of
Control" shall mean a change in ownership or managerial control of the stock,
assets or business of the Company resulting from one or more of the following
circumstances:

          (a) A change of control of the Company, 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 Act, or any successor regulation of
     similar import, regardless of whether the Company is subject to such
     reporting requirement;

          (b) A change in ownership of the Company through a transaction or
     series of transactions, such that any individual, partnership, joint
     venture, association, trust, corporation or other entity, other than an
     employee benefit plan of the Company or an entity organized, appointed or
     established pursuant to the terms of any such benefit plan (other than any
     current officer of the Company or member of the Company's Board of
     Directors) is (are) or become(s), in the aggregate, the Beneficial Owner
     (as defined in Rule 13d-3 of the General Rules and Regulations of the
     Securities Exchange Act of 1934 , directly or indirectly, of securities of
     the Company representing twenty percent (20%) or more of the Company's then
     outstanding securities;

          (c) Any consolidation or merger of the Company in which the Company is
     not the continuing or surviving corporation or pursuant to which shares of
     the common stock of the Company would be converted into cash (other than
     cash attributable to dissenters' rights), securities or other property
     provided by an individual, partnership, joint venture, association, trust,
     corporation or other entity, other than an employee benefit plan of the
     Company or an entity organized, appointed or established pursuant to the
     terms of any such benefit plan other than the Company, other than a
     consolidation or merger of the Company in which the holders of the common
     stock of the Company immediately prior to the consolidation or merger have
     approximately the same proportionate ownership of common stock of the
     surviving corporation immediately after the consolidation or merger;

          (d) The shareholders of the Company approve a sale, transfer,
     liquidation or other disposition of all or substantially all of the assets
     of the Company to an individual,

                                       5
<PAGE>

     partnership, joint venture, association, trust, corporation or other
     entity, other than an employee benefit plan of the Company or an entity
     organized, appointed or established pursuant to the terms of any such
     benefit plan;

          (e) During any period of two (2) consecutive years, individuals who,
     at the beginning of such period, constituted the Board of Directors of the
     Company cease, for any reason, to constitute at least a majority thereof,
     unless the election or nomination for election of each new director was
     approved by the vote of at least two-thirds (2/3) of the directors then
     still in office who were directors at the beginning of the period;

          (f) The filing of a proceeding under Chapter 7 of the Federal
     Bankruptcy Code (or any successor or other statute of similar import) for
     liquidation with respect to the Company;

          (g) The filing of a proceeding under Chapter 11 of the Federal
     Bankruptcy Code (or any successor or other statute of similar import) for
     reorganization with respect to the Company if in connection with any such
     proceeding, this Agreement is rejected, or a plan of reorganization is
     approved an element of which plan entails the liquidation of all or
     substantially all the assets of the Company.

     A "Change of Control" shall be deemed to occur on the actual date on which
     any of the foregoing circumstances shall occur; provided, however, that in
     connection with a "Change of Control" specified in Section 8(g), a "Change
     of Control" shall be deemed to occur on the date of the filing of the
     relevant proceeding under Chapter 11 of the Federal Bankruptcy Code (or any
     successor or other statute of similar import).

     9. Dilution Protection.

          (a) In the event the Company shall (i) declare a dividend on its
     Common Stock in shares of Common Stock or make a distribution in shares of
     Common Stock, (ii) declare a stock split or reverse stock split of its
     outstanding shares of Common Stock, (iii) combine its outstanding shares of
     Common Stock into a smaller number of shares of Common Stock or (iv) issue
     by reclassification of its shares of Common Stock other securities
     (including any such reclassification in connection with a consolidation or
     merger in which the Company or any of its subsidiaries is the continuing
     corporation), then the number of shares of Common Stock of the Company,
     deliverable to Optionee hereunder and the exercise price related thereto
     shall be adjusted so that Optionee shall be entitled to receive the kind
     and number of shares of Common Stock of the Company which the Optionee has
     the right to receive, upon the happening of any of the events described
     above, with respect to the shares of the Company stock which were otherwise
     deliverable pursuant hereto. An adjustment made pursuant to this paragraph
     shall become effective immediately after the effective date of such event;

          (b) Whenever the number of Shares or the exercise price of this Option
     is adjusted pursuant to this paragraph, the Company shall promptly mail by
     first class mail, postage prepaid, to Optionee, notice of such adjustment
     or adjustments.

                                       6
<PAGE>

     10. Availability Of Company Stock. The Company hereby agrees and covenants
that at all times during the term of this Option it shall reserve for issuance a
sufficient number of shares of Common Stock as would be required upon full
exercise of the rights represented by this Agreement.

     11. Tax Consequences. Some of the federal tax consequences relating to this
Option, as of the date of this Option, are set forth below. THIS SUMMARY IS
NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.
THE OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR
DISPOSING OF THE SHARES.

          (a) Exercising the Option. The Optionee may incur regular federal
              ---------------------
     income tax liability upon exercise of the Option. The Optionee may be
     treated as having received compensation income (taxable at ordinary income
     tax rates) equal to the excess, if any, of the Fair Market Value of the
     Exercised Shares on the date of exercise over their aggregate Exercise
     Price. If the Optionee is an Employee, the Company will be required to
     withhold from Optionee's compensation or collect from Optionee and pay to
     the applicable taxing authorities an amount equal to a percentage of this
     compensation income at the time of exercise.

          (b) Disposition of Shares. If the Optionee holds the Shares for at
              ---------------------
     least one year, any gain realized on disposition of the Shares will be
     treated as long-term capital gain for federal income tax purposes.

     11. Governing Law. This Agreement is governed by the laws of the State
Utah.

     IN WITNESS WHEREOF, this Agreement is executed effective as of the date
first set forth above.

                                        CATEGORY 5 TECHNOLOGIES, INC.

                                        By:/s/ Mitchell Edwards
                                           -------------------------------------
                                        Its:/s/ President
                                            ------------------------------------

                                        OPTIONEE:

                                        /s/ William C. Gibbs
                                        ----------------------------------------

                                       7
<PAGE>

                                    EXHIBIT A

                          CATEGORY 5 TECHNOLOGIES, INC.

                                 EXERCISE NOTICE

Category 5 Technologies, Inc.
4505 South Wasatch Boulevard, Suite 370
Salt Lake City, Utah 84124

     1. EXERCISE OF OPTION. Effective as of today, ________________, ___, the
undersigned ("Purchaser") hereby elects to purchase ______________ shares (the
"Shares") of the non-voting Common Stock of Category 5 Technologies, Inc. (the
"Company") under and pursuant to the Stock Option Agreement dated August 5, 2001
(the "Option Agreement"). The purchase price for the Shares shall be as set
forth in the Option Agreement, as adjusted.

     2. DELIVERY OF PAYMENT. Purchaser herewith delivers to the Company the full
purchase price for the Shares either |_| in cash or check or |_| by Net
Exercise.

     3. REPRESENTATIONS OF PURCHASER. Purchaser acknowledges that Purchaser has
received, read and understood the Option Agreement and agrees to abide by and be
bound by its terms and conditions.

     4. RIGHTS AS SHAREHOLDER. Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the stock certificate evidencing the Shares, no right
to vote or receive dividends or any other rights as a shareholder shall exist
with respect to the Shares, notwithstanding the exercise of the Option. A stock
certificate for the number of Shares so acquired shall be issued to the
Purchaser as soon as practicable after exercise of the Option.

     5. TAX CONSULTATION. Purchaser understands that Purchaser may suffer
adverse tax consequences as a result of Purchaser's purchase or disposition of
the Shares. Purchaser represents that Purchaser has consulted with any tax
consultants Purchaser deems advisable in connection with the purchase or
disposition of the Shares and that Purchaser is not relying on the Company for
any tax advice.

     6. ENTIRE AGREEMENT. The Option Agreement is incorporated herein by
reference. This Exercise Notice and the Option Agreement constitute the entire
agreement of the parties and supersede in their entirety all prior undertakings
and agreements of the Company and the Purchaser with respect to the subject
matter hereof.
<PAGE>

Submitted by:                           Accepted by:

PURCHASER:                              CATEGORY 5 TECHNOLOGIES, INC.

                                        By:
-----------------------------              -------------------------------------
Signature                               Its:
                                            ------------------------------------

-----------------------------
Print Name

Address:
-------

-----------------

                                       2

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