Document:

<PAGE>

                                                                   EXHIBIT 10.80

                           MICRON ELECTRONICS, INC.

                              CIC SEVERANCE PLAN

                               January 11, 2001,
                           as amended March 2, 2001

Micron Electronics, Inc.,
 a Minnesota corporation
900 East Karcher Road
Nampa, Idaho 83687
<PAGE>

                               TABLE OF CONTENTS

                                                             Page
ARTICLE 1..................................................     1
   Effective Date; Plan Year; ERISA........................     1
     1.01    Effective Date................................     1
     1.02    Plan Year.....................................     1
     1.03    ERISA.........................................     2

ARTICLE 2..................................................     2
   Application to Company or Affiliates....................     2
     2.01    Eligible Employers............................     2
     2.02    Adoption Procedure............................     2

ARTICLE 3..................................................     2
   Eligibility and Participation...........................     2
     3.01    Eligible Employees............................     2
     3.02    Participation.................................     3
     3.03    Determination of Eligibility and Participation     3

ARTICLE 4..................................................     3
   CIC Severance Benefits..................................     3
     4.01    Entitlement to CIC Severance Benefits.........     3
     4.02    CIC Severance Pay.............................     5
     4.03    Rehire                                             6
     4.04    Time and Manner of Payment....................     6
     4.05    Forfeitability of Severance Benefits..........     6
     4.06    Alternative Benefits..........................     7

ARTICLE 5..................................................     7
   Administration..........................................     7
     5.01    Administrator.................................     7
     5.02    The Administrator's Powers and Duties.........     7
     5.03    The Company and Employer Functions............     7
     5.04    Claims Procedures.............................     8
     5.05    Indemnity and Bonding.........................     8
     5.06    Expenses......................................     9

ARTICLE 6..................................................     9
   General Provisions......................................     9
     6.01    Enforceability and Exclusive Benefit..........     9
     6.02    Amendment and Termination.....................     9
     6.03    Not Contract of Employment....................     9
     6.04    Unfunded......................................    10
     6.05    Nonassignment.................................    10
     6.06    Applicable Law................................    10

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                                 INDEX OF TERMS

Term                               Section
                                                   Page        Page

Administrator                      5.01                                 7
Affiliate                          2.01-2                               2

Change in Control                  4.01-3                               3
CIC Severance Plan                 Preamble                             1
Code                               2.01-2                               2
Company                            Heading                              1

Effective Date                     1.01                                 1
Eligible Employees                 3.01                                 2
Employer                           2.01-3                               2
ERISA                              1.03-1                               2

Offer of Comparable Employment     4.01-4                               4

Participant                        3.02                                 3
Plan Year                          1.02                                 1

Regular Pay                        4.02-2                               6

                                      ii
<PAGE>

                           MICRON ELECTRONICS, INC.
                              CIC SEVERANCE PLAN

                               January 11, 2001,
                           as amended March 2, 2001

Micron Electronics, Inc.,
 a Minnesota corporation
900 East Karcher Road
Nampa, Idaho 83687                                                      Company

     The Company recognizes that, as is the case with many publicly held
corporations, the possibility of an asset sale or other change in control may
exist, and that the uncertainty and questions which such possibility may raise
among management may result in the departure or distraction of management
personnel to a detriment of the Company and its stockholders.  The Company has
determined that in the event of that contingency, it is imperative to be able to
rely upon management's continuance and leadership and that appropriate steps
should be taken to reinforce and encourage that leadership and to reward the
management's essential service.  The Company has adopted this CIC Severance Plan
for Eligible Employees (the "CIC Severance Plan") effective January 11, 2001, as
amended March 2, 2001, to provide an orderly and ongoing system of severance
benefits to be paid to Eligible Employees in appropriate situations related to a
Change in Control of the Company.  The CIC Severance Plan supersedes and
replaces the resolutions of the Compensation Committee of the Company's Board of
Directors with respect to "Severance Payouts Upon Change in Control" dated April
29, 1997, and November 23, 1998.  The CIC Severance Plan further supersedes and
replaces any other resolutions or any plans, policies, or agreements maintained
or made by Micron Electronics, Inc. or any adopting affiliate that provides for
the payment or provision of pay or benefits in the event of a Change in Control
of the Company covering its Eligible Employees.

                                   ARTICLE 1

                       Effective Date; Plan Year; ERISA

     1.01  Effective Date

     The effective date of this CIC Severance Plan is January 11, 2001.  The
benefits of Eligible Employees who receive notice of termination from employment
from the Company on or after that date shall be determined under the CIC
Severance Plan.

     1.02  Plan Year

     The initial plan year shall be a short year beginning on January 11, 2001
and ending on December 31, 2001.  Thereafter the plan year shall be a calendar
year.
<PAGE>

     1.03  ERISA

           1.03-1  The CIC Severance Plan is intended to be and shall be
administered and maintained as a welfare benefit plan under section 3(1) of the
Employee Retirement Income Security Act of 1974 ("ERISA"), providing certain
benefits to participants on certain severances from employment.

           1.03-2  The CIC Severance Plan is not intended to be a pension plan
under section 3(2)(A) of ERISA and shall be maintained and administered so as
not to be such a plan.  The CIC Severance Plan is intended to come within, and
shall be administered and maintained to come within, the severance pay plan
exception thereto in Department of Labor regulations section 2510.3-2(b).

                                   ARTICLE 2

                     Application to Company or Affiliates

     2.01  Eligible Employers

           2.01-1  The Company maintains the CIC Severance Plan for its Eligible
Employees.  Any Affiliate approved by the Company may adopt and maintain the CIC
Severance Plan for its Eligible Employees or other designated class of
employees.

           2.01-2  "Affiliate" means a corporation, person or other entity that
is a member, with the Employer, of a controlled or affiliated service group
under section 414(b), (c), (m) or (o) of the Internal Revenue Code of 1986 (the
"Code").

           2.01-3  "Employer" means Company and any adopting Affiliate.  The CIC
Severance Plan is a single plan maintained by the Company and any adopting
Affiliate.

     2.02  Adoption Procedure

     An adopting Employer shall execute an adoption statement that shall include
the effective date, date of adoption and any special provisions that are to be
applicable only to employees of the Affiliate.

                                   ARTICLE 3

                         Eligibility and Participation

     3.01  Eligible Employees

     Eligible Employees are Management Directors, Area Vice Presidents, Vice
Presidents and other Key Contributors.  The term "Key Contributors" as used
herein shall include employees that are designated as eligible under this CIC
Severance Plan by the Administrator

                                       2
<PAGE>

in accordance with applicable guidelines approved by the Compensation Committee
of the Company's Board of Directors for the designation of Key Contributors.

     3.02  Participation

          3.02-1  Any Eligible Employee who becomes entitled to severance
benefits under 4.01 is a Participant in the CIC Severance Plan.  A Participant
must satisfy the requirements of 4.01 to be entitled to severance benefits under
the CIC Severance Plan.

          3.02-2  An Eligible Employee who is a Participant in the CIC Severance
Plan shall not participate in the Micron Electronics Severance Pay Plan for
Employees.

     3.03  Determination of Eligibility and Participation

     All questions of eligibility and participation of employees shall be
determined by the Administrator, whose decision shall be final.

                                   ARTICLE 4

                            CIC Severance Benefits

     4.01  Entitlement to CIC Severance Benefits

           4.01-1  Except as provided in 4.01-2, an Eligible Employee who is
involuntarily terminated from employment with Employer due to a Change in
Control under 4.01-3 and receives notice of such termination from the Company on
or after the effective date of the CIC Severance Plan is entitled to CIC
Severance Benefits.

           4.01-2  An Eligible Employee who receives an Offer of Comparable
Employment under 4.01-4 before or after the effective date of termination shall
not be entitled to CIC Severance Benefits.

           4.01-3  For 4.01-1, a "Change in Control" occurs in the event of any
of the following:

               (a) Any Person, as such term is used in Sections 13(d) and 14(d)
           of the Securities Exchange Act of 1934, as amended (the "Exchange
           Act"), is or becomes the beneficial owner (as defined in Rule 13d-3
           under the Exchange Act), directly or indirectly, of securities of the
           Company representing 50 percent or more of the combined voting power
           of the Company's then outstanding securities;

               (b) The shareholders of the Company approve a merger or other
           consolidation of the Company with or into any other entity, other
           than a merger or consolidation that would result in the holders of
           the voting securities of the Company outstanding

                                       3
<PAGE>

           immediately prior thereto holding securities which represent
           immediately after such merger or consolidation more than 50 percent
           of the combined voting power of the entity which survives such merger
           or consolidation or the parent of the entity which survives such
           merger or consolidation.

               (c) The Company sells, liquidates or distributes all or
           substantially all of its assets in a single transaction or series of
           transactions to a buyer or buyers who are not Affiliates.

               (d) The Company's Board of Directors adopts a Wind Down
           Resolution and the Company sells, liquidates or distributes all or
           substantially all of the assets of a Business Unit in a single
           transaction or series of transactions to a buyer or buyers who are
           not Affiliates. A transaction shall constitute a Change in Control
           under this 4.01-3(d) with respect to (i) the Eligible Employees of
           the subject Business Unit, and not for the employees of any other
           Business Unit, and (ii) the Eligible Employees who are employed in
           the Company's general corporate or administration functions providing
           services directly to the subject Business Unit and who are terminated
           from employment due to a Change in Control under this 4.01-3(d). The
           term "Wind Down Resolution" as used herein shall mean a resolution
           adopted by the Company's Board of Directors to liquidate and wind
           down a Business Unit. The term "wind down" is interchangeable with
           the term "wind up," and may include, without limitation, every act
           necessary by the Company to "wind down" or "wind up" the business and
           affairs of a Business Unit within the meaning of applicable law and
           as determined appropriate by the Board under the circumstances. The
           term "Business Unit" as used herein shall mean a reportable segment
           of the Company as referred to in the Company's latest Form 10-K or
           Form 10-Q filed under the Exchange Act, or such other reporting
           segment, division or operating unit as may be designated by the
           Administrator.

           4.01-4  For 4.01-2, an Offer of Comparable Employment is an offer of
employment made on or before the date of a Change in Control by any Employer, or
any Person or buyer under 4.01-3, to an employee that provides following such
Change in Control for (i) a Comparable Job Position, and (ii) wages, benefits
and location similar to those which the Eligible Employee enjoyed immediately
before the Change in Control as reasonably determined by Employer.  A Comparable
Job Position shall mean, as reasonably determined by Employer: (i) a job
position that is similar to the job position which the Eligible Employee held
with Employer immediately before the Change in Control, or (ii) a job position
that

                                       4
<PAGE>

involves, requires or relates to the Eligible Employee's area or areas of
expertise or experience.

           4.01-5  Unless otherwise specified by Employer in writing, a
Participant shall not be entitled to severance benefits under the CIC Severance
Plan if any of the following occur with respect to such Participant:

               (a) Failure to waive any other severance or other separation
           benefits under any agreement or arrangement with Employer or any
           Affiliate or any voluntary early retirement program maintained by
           Employer or Affiliate or any severance plan maintained by Employer or
           an Affiliate, other than the CIC Severance Plan.

               (b) Involuntary termination of employment for reasons other than
           Change in Control, including, but not limited to, involuntary
           termination for unsatisfactory performance, unacceptable behavior,
           misconduct, violations of Employer's policies, or other disciplinary
           problems.

               (c) Failure to execute a waiver and release of claims against
           Employer and Affiliates in the form provided by Employer within the
           specified consideration period or execution and later revocation of
           the waiver and release of claims form within the revocation period
           stated therein.

               (d) Voluntary termination of employment for any reason.  A
           termination is voluntary even if continued employment depends on
           relocation to another job site or acceptance of a position with a
           different base or variable compensation, title or responsibilities.

     4.02  CIC Severance Pay

           4.02-1  Subject to 4.04, 4.05 and 4.06, Participants who are eligible
for CIC severance benefits under 4.01 shall be entitled to receive CIC Severance
Pay equal to a number of months of regular pay as follows:

                               CIC SEVERANCE PAY

           Eligible Employees                     Number
           Class Designation                    of Months
           -----------------                    ---------

           Board-appointed Vice Presidents          6
           Non-board appointed Vice Presidents
             and Area Vice Presidents               4

                                       5
<PAGE>

           Management Directors                     3
           Key Contributors                         2

           4.02-2  For the purposes of 4.02-1 and Participants who are not
employed as sales representatives by an Employer, "regular pay" means base pay
on the date of termination, excluding any overtime, bonuses, incentives,
severance pay, reimbursements, any other allowances and any other type of extra
or variable compensation.  For the purposes of 4.02-1 and Participants who are
employed as sales representatives by an Employer, "regular pay" means base pay
plus target incentives or sales commissions on the date of termination,
excluding any overtime, bonuses, other incentives, severance pay,
reimbursements, any other allowances and any other type of extra or variable
compensation.

           4.02-3  For the purposes of 4.02-1, the amount of CIC Severance Pay
may be reduced by an amount of up to 60 days' pay and benefits for each of the
Participants whose involuntary termination due to a Change in Control the
Company or an Affiliate deems covered by the Worker Adjustment and Retraining
Notification Act (29 U.S.C. (S) 2101 et seq.) ("WARN").  A Participant who
receives a notice from Employer under WARN and continues working for Employer
during the notice period as designated by Employer shall not incur a reduction
of CIC Severance Pay under this 4.02-3 with respect to the days actually worked
by the Participant during such notice period.

     4.03  Rehire

     A Participant who has received CIC Severance Pay and who is rehired by
Employer or is hired by any Affiliate shall not be required to repay any CIC
Severance Pay received as of the date of hire or rehire.

     4.04  Time and Manner of Payment

           4.04-1  CIC Severance Pay shall be paid in a lump sum.  Payment will
be made as soon as practicable following the later of the Participant's
termination date or the expiration of the revocation period described in the
waiver and release of claims form under 4.01-5(c).

          4.04-2  Employer may withhold from any amounts paid under the CIC
Severance Plan any income tax or other amounts as allowed or required by law.

     4.05  Forfeitability of Severance Benefits

     Any right to severance benefits shall be forfeitable until the Participant
has been involuntarily terminated from employment due to Change in Control and
has satisfied all of the requirements and conditions for entitlement under 4.01.
The CIC Severance Plan may be amended or terminated as provided in Article 6 to
partially or wholly eliminate or otherwise change the benefits in 4.01 to the
extent they are forfeitable.

                                       6
<PAGE>

     4.06  Alternative Benefits

     The Compensation Committee shall retain complete discretion to change the
amount of or the manner of determining the severance benefits payable to any
Eligible Employee at any time before payment of benefits begins under 4.04-1.

                                   ARTICLE 5

                                 Administration

     5.01  Administrator

           5.01-1  The CIC Severance Plan shall be administered by the
Compensation Committee of the Company's Board of Directors or its designee who
in such capacity shall be the Administrator.

           5.01-2  The Administrator may resign on 15 days' notice to the
Company.  The Company may remove the Administrator without having to show cause.
The vacancy shall be filled as soon as reasonably practicable.  Until a new
appointment is made, the Company shall act as the Administrator.

     5.02  The Administrator's Powers and Duties

           5.02-1  The Administrator shall interpret the CIC Severance Plan,
decide any questions about the rights of Participants and in general administer
the CIC Severance Plan.  Any decision by the Administrator shall be final and
bind all parties.  The Administrator shall have absolute discretion to carry out
the Administrator's responsibilities under this section.

           5.02-2  The Administrator may delegate all or part of the
administrative duties to one or more agents and may retain advisors and agents
for assistance.  The Administrator may consult with, and rely upon the advice of
counsel, who may be counsel for the Company or any Affiliate.

           5.02-3  The Administrator shall be the plan administrator under
federal laws and regulations applicable to plan administration and shall comply
with such laws and regulations.  The Administrator shall be the agent for
service of process on the CIC Severance Plan at the Company's address.

     5.03  The Company and Employer Functions

           5.03-1  Except as provided in 5.03-2, all authority of the Company or
Employer, including, in the case of the Company, the power to amend or terminate
the CIC Severance Plan, shall be exercised by the Company's Compensation
Committee or Board of Directors, as applicable, who may delegate some or all of
the authority to any officer.

           5.03-2  The chief executive officer of the Company or delegate may
amend the CIC Severance Plan in writing, on advice of counsel, to make
technical, administrative or

                                       7
<PAGE>

editorial changes to comply with applicable law or to simplify or clarify the
CIC Severance Plan.

           5.03-3  The Board of Directors of the Company or any other Employer
shall have no administrative authority or function with respect to the CIC
Severance Plan.  Being a member of the Board shall not, in itself, make a person
a plan fiduciary.

     5.04  Claims Procedures

           5.04-1  Any person claiming a benefit or requesting information, an
interpretation or a ruling under the CIC Severance Plan shall present the
request in writing to the Administrator.  The Administrator or delegate will
respond in writing as soon as practicable.

           5.04-2  If the claim or request is denied, the written notice of
denial shall state:

               (a) The reasons for denial, with specific reference to the terms
           of the written document on which denial is based.

               (b) A description of any additional material or information
           required for review of the claim and an explanation of why it is
           necessary.

               (c) An explanation of the CIC Severance Plan=s claims review
           procedure.

           5.04-3  Any person whose claim or request is denied, or who has not
received a response within 90 days, may request review by notice in writing to
the Administrator.  The original decision will be reviewed by the Administrator
or delegate, who may, but shall not be required to, grant the claimant a
hearing.  On review, whether or not there is a hearing, the claimant may have
representation, examine pertinent documents and submit issues and comments in
writing.

           5.04-4  The decision on review shall normally be made within 60 days.
If an extension of time is required for a hearing or other special
circumstances, the Participant shall be so notified and the time limit shall be
120 days.  The decision shall be in writing and shall state the reasons and the
relevant plan provisions.  All decisions on review shall be final and binding on
all parties concerned.  If the Participant does not receive a decision within
the time limit, the claim shall be considered wholly denied on review.

     5.05  Indemnity and Bonding

           5.05-1  The Company shall indemnify and defend any CIC Severance Plan
fiduciary who is an officer, director or employee of the Company against any
claim or liability

                                       8
<PAGE>

that arises from any action or inaction in connection with the CIC Severance
Plan, subject to the following rules:

               (a) Coverage shall be limited to actions taken in good faith that
           the fiduciary reasonably believed were not opposed to the best
           interest of the CIC Severance Plan.

               (b) Negligence by the fiduciary shall be covered to the fullest
           extent permitted by law.

               (c) Coverage shall be reduced to the extent of any insurance
           coverage.

           5.05-2  The CIC Severance Plan fiduciaries shall be bonded to the
extent required by applicable law.

     5.06  Expenses

           5.06-1  An Administrator who is employed full-time by Employer shall
not be separately compensated for services as the Administrator.  The
Administrator shall be reimbursed by the Company for all expenses incurred while
acting as the Administrator.

           5.06-2  The Company may allocate the cost of any administrative fees
or expenses among Employers.  Otherwise, all expenses and fees shall be paid by
the Company.

                                   ARTICLE 6

                              General Provisions

     6.01  Enforceability and Exclusive Benefit

     The Company and Employers intend the terms of the CIC Severance Plan,
including those relating to the coverage and benefits, to be legally
enforceable.  The Company and Employers further intend that the CIC Severance
Plan be maintained for the exclusive benefit of Eligible Employees of Employers.

     6.02  Amendment and Termination

     Subject to 4.05, the Company may amend or terminate the CIC Severance Plan
at any time.

     6.03  Not Contract of Employment

     Nothing in the CIC Severance Plan shall give any employee the right to
continue employment.  The CIC Severance Plan shall not prevent discharge of any
employee at any time for any reason.

                                       9
<PAGE>

     6.04  Unfunded

     All benefits payable under the CIC Severance Plan shall be unfunded and
shall be payable only from the general assets of Employer.  The Participants
shall have no interest in any assets of Employer and shall have no rights
greater than the rights of any unsecured general creditor of Employer.

     6.05  Nonassignment

     The rights of a Participant under the CIC Severance Plan are personal.  No
interest of a Participant under the CIC Severance Plan may be assigned,
transferred, seized by legal process or subjected to the claims of creditors in
any way.  A Participant's rights under the CIC Severance Plan are not subject in
any manner to anticipation, alienation, sale, transfer, assignment, pledge or
encumbrance.

     6.06  Applicable Law

     The CIC Severance Plan shall be construed according to the laws of the
State of Idaho, except as preempted by federal law.

     Adopted:

     Company                  MICRON ELECTRONICS, INC.

                              By:      /s/
                              Name:    JoAnne S. Pfeifer
                              Title:   Vice President, Administration
                                       Corporate Secretary

                              Date:    March 20, 2001

                                       10<PAGE>

                                                                   EXHIBIT 10.81

                                 HOSTPRO, INC.

                         2000 EQUITY INCENTIVE PLAN II

                                NOTICE OF GRANT

     This Notice of Grant (the "Agreement") is made and entered into as of the
date of grant set forth below (the "Date of Grant") by and between HostPro,
Inc., a Delaware corporation, or any successor corporation (the "Company") and
the participant named below (the "Participant").  Capitalized terms not defined
herein shall have the meaning ascribed to them in the Company's 2000 Equity
Incentive Plan.

Participant:                 Joel Kocher
                             ---------------------------------------------------
Social Security Number:
                             ---------------------------------------------------
Address:                     900 E. Karcher Road
                             ---------------------------------------------------
                             Nampa, Idaho 83687
                             ---------------------------------------------------
Total Option Shares:         1,800,000
                             ---------------------------------------------------
Exercise Price Per Share:    $.56
                             ---------------------------------------------------
Date of Grant:               February 23, 2001
                             ---------------------------------------------------
First Vesting Date:          December 22, 2001
                             ---------------------------------------------------
Expiration Date:             December 21, 2010
                             ---------------------------------------------------
                             (unless earlier terminated under Section 5.6 of the
                             Plan)
Type of Stock Option
(Check one):                 [ ] Incentive Stock Option

                             [X] Nonqualified Stock Option

     1.   Grant of Option.  The Company hereby grants to Participant an option
          ---------------
(this "Option") to purchase the total number of shares of Common Stock, .01 par
value, of the Company set forth above as Total Option Shares (the "Shares") at
the Exercise Price Per Share set forth above (the "Exercise Price"), subject to
all of the terms and conditions of this Agreement and the Plan.

     2.   Exercise Period.
          ---------------

          2.1  Exercise Period of Option.  Provided Participant continues to
               -------------------------
provide services to the Company as Chief Executive Officer, except as otherwise
provided in this Section 2.1, the Option will become vested and exercisable as
to portions of the Shares as follows: (i) this Option shall not vest nor be
exercisable with respect to any of the Shares until
<PAGE>

the First Vesting Date set forth on the first page of this Agreement (the "First
Vesting Date") (ii) on the First Vesting Date the Option will become vested and
exercisable as to nine hundred thousand (900,000) of the Shares; and (iii)
thereafter on the first day of each of the succeeding thirty six (36) months the
Option will become vested and exercisable as to twenty five thousand (25,000) of
the Shares until the Shares are vested with respect to one hundred percent
(100%) of the Shares. However, in the event of Participant's Resignation for
Good Reason or termination without Cause, in either case prior to December 22,
2001, the Option will vest as follows: nine hundred thousand (900,000) Shares of
the Option shall become immediately vested and exercisable, in lieu of any other
vesting set forth in this Agreement. In the event of Participant's Resignation
for Good Reason or termination without Cause within twelve months following a
Corporate Transaction, one hundred percent (100%) of the Unvested Shares of the
Option will become vested and exercisable. If application of the vesting
percentage causes a fractional share, such share shall be rounded down to the
nearest whole share for each month except for the last month in such vesting
period, at the end of which last month this Option shall become exercisable for
the full remainder of the Shares. Subject to earlier termination of the Option
as provided herein, this Option may not be exercised prior to the earlier of (i)
issue to the public of shares of Common Stock ("IPO") pursuant to a Form S-1
Registration Statement under the Securities Act of 1933, as amended (the "Act"),
(ii) the registration under the Act of any substituted stock underlying the
Option or (iii) five (5) years from the date such Option is granted.

          2.2  Vesting of Option.  Shares that are vested pursuant to the
               -----------------
schedule set forth in Section 2.1 are "Vested Shares." Shares that are not
vested pursuant to the schedule set forth in Section 2.1 are "Unvested Shares."

          2.3  Expiration.  The Option shall expire on the Expiration Date set
               ----------
forth above or earlier as provided in Section 3 below or pursuant to Section 5.6
of the Plan.

          2.4  Definitions.  As used in this Agreement, the following terms
               -----------
have the following meanings:

               2.4.1.  "Resignation for Good Reason" means Participant's
resignation of his employment upon written notice to the Board of Directors
within 120 days following the occurrence of a "Good Reason."

               2.4.2.  "Cause" means termination by the Company of Participant's
employment because of (i) any willful, material violation by the Participant of
any law or regulation applicable to the business of the Company or a parent or
subsidiary of the Company or any successor, as applicable, the Participant's
conviction for, or guilty plea to, a felony or a crime, or any willful
perpetration by the Participant of a common law fraud, (ii) Participant's
commission of an act of personal dishonesty which involves personal profit in
connection with the Company or any successor, as applicable, or any other entity
having a business relationship with the Company, or any successor, as
applicable, (iii) any breach by Participant of any material provision of any
agreement or understanding between the Company and Participant regarding

                                       2
<PAGE>

Participant's service as an employee, officer, director or consultant to the
Company or any successor, as applicable, which results in loss, damage or injury
to the Company or any successor, including, without limitation, the willful and
continued refusal of Participant to perform the material duties reasonably
required of Participant as an employee, officer, director or consultant of the
Company or any successor, other than as a result of having a Disability, (iv)
Participant's violation of the policies of the Company or any successor, as
applicable, so as to cause loss, damage or injury to the property, reputation or
employees of the Company or any successor, or (v) any willful misconduct or
unauthorized actions by Participant which results in loss, damage or injury to
the Company or any successor.

               2.4.3.  "Disability" means (i) Participant's incapacity due to
physical or mental illness that causes Participant to be absent from the full-
time or regular performance of Participant's duties with the Company or any
successor, as applicable, for at least 90 consecutive days, and (ii)
Participant's failure to return to full-time or regular performance of
Participant's duties for the Company or any successor, as applicable, within 15
days after receiving written notice of termination of this Agreement due to
Disability.  Any question as to the existence of a Disability upon which
Participant and the Company cannot agree shall be determined by a qualified
independent physician selected by the Company and approved by Participant.  The
determination of such physician made in writing to the Company and to
Participant shall be final and conclusive for all purposes of determining
Disability under this Agreement.

               2.4.4.  "Good Reason" means a resignation of Participant's
employment because of one or more of the following reasons: (i) a substantial
adverse change without Participant's consent in Participant's responsibilities
from those in effect or assigned as of the Date of Grant; (ii) Participant's no
longer being the Chief Executive Officer of the Company or, in the case of a
Corporate Transaction, of the surviving entity or acquiror that results from any
Corporate Transaction; Date of Grant; or (iii) a Company-imposed relocation of
Participant's principal place of employment from that of the headquarters
established by the Company after the Date of Grant, without Participant's
consent; provided, however, that any event described in clauses (i) through
(iii) shall not constitute Good Reason unless it is first communicated by
Participant to the Company in writing and such event is not corrected by the
Company in a manner that is reasonably satisfactory to Participant within 10
days of the Company's receipt of such written notice from Participant.

     3.   Termination.
          -----------

          3.1  Resignation for Good Reason or Termination Without Cause.
               --------------------------------------------------------
Following Participant's resignation for Good Reason or termination by the
Company without Cause, the Participant (or Participant's legal representative)
may exercise the Option only to the extent that such Option are exercisable on
the Termination Date or as otherwise determined by the Committee.  Such Option
must be exercised by the Participant, if at all, as to some or all of the Vested
Shares calculated as of the Termination Date for a period of thirty (30) days
from the later of such Termination Date but, in any event, no later than the
expiration of the Option.

                                       3
<PAGE>

          3.2  Termination Because of Death or Disability.  Following
               ------------------------------------------
Participant's death or Disability, Participant (or Participant's legal
representative) may exercise the Option only to the extent that such Option are
exercisable on the Termination Date or as otherwise determined by the Committee.
Such Option must be exercised by the Participant, if at all, as to some or all
of the Vested Shares calculated as of the Termination Date for a period of
thirty (30) days from the later of such Termination Date but, in any event, no
later than the expiration date of the Option.

          3.3  Termination for Cause.  If Participant is terminated by the
               ---------------------
Company for Cause, then Participant's Option shall expire on such Participant's
Termination Date, or at such later time and on such conditions as are determined
by the Committee.

          3.4  Extension of Time to Exercise Following Spinoff or Corporate
               ------------------------------------------------------------
Transaction.  Notwithstanding anything in the Plan or in this Section 3 to the
-----------
contrary, if (i) a Participant is employed by Micron Electronics, Inc. ("MEI")
or Micron Technology, Inc. immediately preceding a Spinoff or (ii) a
Participant's Option accelerate pursuant to Section 5 hereof, then such Option
may be exercised within one year following the later of (A) such Spinoff or
acceleration or (B) the registration under the Act of the Shares or any
substituted stock underlying such Option.

          3.5  No Obligation to Employ.  Nothing in the Plan or this Agreement
               -----------------------
shall confer on Participant any right to continue in the employ of, or other
relationship with, the Company or any Parent or Subsidiary of the Company, or
limit in any way the right of the Company or any Parent or Subsidiary of the
Company to terminate Participant's employment or other relationship at any time,
with or without Cause.

          3.6  Confidentiality.  Participant agrees that  information regarding
               ---------------
this Option, including, but not limited to, the issuance of the Option to
Participant and the number of Shares subject to the Option, is Company
confidential information, and is subject to Participant's obligations to
maintain such information in confidence. Participant agrees not to disclose such
information to any third party, except to his or her immediate family members,
accountants, financial advisors and attorneys (each of whom shall be informed of
the confidential nature of the information and agree not to disclose the
information to any third party), or as required by law.  Participant agrees that
the Committee may, at its discretion, immediately terminate all or part of this
Option if Participant violates this Section 3.6.

     4.   Manner of Exercise.
          ------------------

          4.1  Stock Option Exercise Agreement.  To exercise this Option,
               -------------------------------
Participant (or in the case of exercise after Participant's death or incapacity,
Participant's executor, administrator, heir or legatee, as the case may be) must
deliver to the Company an executed stock option exercise agreement in such form
as may be approved by the Committee from time to time (the "Exercise
Agreement"), which shall set forth, inter alia, (i) Participant's election to
                                    ----- ----
exercise the Option, (ii) the number of Shares being purchased, (iii) any
restrictions imposed on the Shares and (iv) any representations, warranties and
agreements regarding Participant's

                                       4
<PAGE>

investment intent and access to information as may be required by the Company to
comply with applicable securities laws. If someone other than Participant
exercises the Option, then such person must submit documentation reasonably
acceptable to the Company verifying that such person has the legal right to
exercise the Option and such person shall be subject to all of the restrictions
contained herein as if such person were the Participant.

          4.2  Limitations on Exercise.  The Option may not be exercised unless
               -----------------------
such exercise is in compliance with all applicable federal and state securities
laws, as they are in effect on the date of exercise.  The Option may not be
exercised as to fewer than one hundred (100) Shares unless it is exercised as to
all Shares as to which the Option is then exercisable.

          4.3  Payment.  The Exercise Agreement shall be accompanied by full
               -------
payment of the Exercise Price for the shares being purchased in cash (by check),
or where permitted by law:

               (a) by cancellation of indebtedness of the Company to the
Participant;

               (b) by surrender of shares of the Company's Common Stock that (i)
either (A) have been owned by Participant for more than six (6) months and have
been paid for within the meaning of SEC Rule 144 (and, if such shares were
purchased from the Company by use of a promissory note, such note has been fully
paid with respect to such shares); or (B) were obtained by Participant in the
open public market; and (ii) are clear of all liens, claims, encumbrances or
security interests;

               (c) by waiver of compensation due or accrued to Participant for
services rendered;

               (d) provided that a public market for the Company's stock
exists: (i) through a "same day sale" commitment from Participant and a broker-
dealer that is a member of the National Association of Securities Dealers (an
"NASD Dealer") whereby Participant irrevocably elects to exercise the Option and
to sell a portion of the Shares so purchased sufficient to pay for the total
Exercise Price and whereby the NASD Dealer irrevocably commits upon receipt of
such Shares to forward the total Exercise Price directly to the Company, or (ii)
through a "margin" commitment from Participant and an NASD Dealer whereby
Participant irrevocably elects to exercise the Option and to pledge the Shares
so purchased to the NASD Dealer in a margin account as security for a loan from
the NASD Dealer in the amount of the total Exercise Price, and whereby the NASD
Dealer irrevocably commits upon receipt of such Shares to forward the total
Exercise Price directly to the Company; or

               (e) any other form of consideration approved by the Committee; or

               (f) by any combination of the foregoing.

          4.4  Tax Withholding.  Prior to the issuance of the Shares upon
               ---------------
exercise of the Option, Participant must pay or provide for any applicable
federal, state and local withholding

                                       5
<PAGE>

obligations of the Company. If the Committee permits, Participant may provide
for payment of withholding taxes upon exercise of the Option by requesting that
the Company retain the minimum number of Shares with a Fair Market Value equal
to the minimum amount of taxes required to be withheld; but in no event will the
Company withhold Shares if such withholding would result in adverse accounting
consequences to the Company. In such case, the Company shall issue the net
number of Shares to the Participant by deducting the Shares retained from the
Shares issuable upon exercise.

          4.5  Issuance of Shares.  Provided that the Exercise Agreement and
               ------------------
payment are in form and substance satisfactory to counsel for the Company, the
Company shall issue the Shares registered in the name of Participant,
Participant's authorized assignee, or Participant's legal representative, and
shall deliver certificates representing the Shares with the appropriate legends
affixed thereto.

     5.   CORPORATE TRANSACTIONS.
          ----------------------

          (a) Assumption or Replacement of Option by Successor.  In the event of
              ------------------------------------------------
(i) a dissolution or liquidation of the Company, (ii) a merger or consolidation
in which the Company is not the surviving corporation (other than a merger or
consolidation with a wholly-owned subsidiary, a reincorporation of the Company
in a different jurisdiction, or other transaction in which there is no
substantial change in the stockholders of the Company or their relative stock
holdings and the Option granted under the Plan are assumed, converted or
replaced by the successor corporation, which assumption will be binding on
Participant), (iii) a merger in which the Company is the surviving corporation
but after which the stockholders of the Company immediately prior to such merger
(other than any stockholder that merges, or which owns or controls another
corporation that merges, with the Company in such merger) cease to own their
shares or other equity interest in the Company, or (iv) the sale of
substantially all of the assets of the Company (each, a "Corporate
Transaction"); this Option may be assumed, converted or replaced by the
successor or acquiring corporation (if any), which assumption, conversion or
replacement will be binding on all Participant.  Notwithstanding the foregoing,
a transaction that results in MEI stockholders owning more than 50% of the
resulting entity will not constitute a Corporate Transaction.  In the
alternative, the successor or acquiring corporation may substitute equivalent
Option or provide substantially similar consideration to Participant as was
provided to shareholders (after taking into account the existing provisions of
the Option).  The successor or acquiring corporation may also issue, in place of
outstanding unvested Shares of the Company held by the Participant,
substantially similar shares or other property subject to repurchase
restrictions no less favorable to the Participant.  Notwithstanding anything in
this Section 5(a) to the contrary, in the event that Participant's employment is
terminated by the Company without Cause or Participant resigns for Good Reason,
in either case within one (1) year following the date of a Corporate
Transaction, then the vesting of the unvested portion of the Option will
accelerate as to 100% of the unvested Shares held by Participant upon the
occurrence of such event.

                                       6
<PAGE>

          In the event such successor or acquiring corporation (if any) refuses
to assume or substitute Option, as provided above, pursuant to a Corporate
Transaction described in this Subsection 5(a), then notwithstanding any other
provision in the Plan or Notice of Grant to the contrary, the vesting of such
Option will accelerate and the Option will become exercisable in full prior to
the consummation of such event at such times and on such conditions as the
Committee determines, and if such Option are not exercised prior to the
consummation of the Corporate Transaction, they shall terminate in accordance
with the provisions of the Plan.  Notwithstanding anything in the Plan or the
Notice of Grant to the contrary, the Committee may, in its sole discretion,
provide that the vesting of any or all Option granted pursuant to the Plan will
accelerate upon a Corporate Transaction described in this Section 5.  If the
Committee exercises such discretion with respect to Option, such Option will
become exercisable in full prior to the consummation of such event at such time
and on such conditions as the Committee determines, and if such Option are not
exercised prior to the consummation of the Corporate Transaction, they shall
terminate at such time as determined by the Committee.

          (b) Other Treatment of Option.  Subject to any greater rights granted
              -------------------------
to Participants under the foregoing provisions of this Section 5, in the event
of the occurrence of any transaction described in Section 5(a) hereof, any
outstanding Option will be treated as provided in the applicable agreement or
plan of merger, consolidation, dissolution, liquidation or sale of assets.

          (c) Assumption of Option by the Company.  The Company, from time to
              -----------------------------------
time, also may substitute or assume outstanding options granted by another
company, whether in connection with a Corporate Transaction, acquisition of such
other company or otherwise, by either (i) granting an option under this Plan in
substitution of such other company's option or (ii) assuming such option as if
it had been granted under this Plan if the terms of such assumed option could be
applied to an option granted under this Plan.  Such substitution or assumption
will be permissible if the holder of the substituted or assumed option would
have been eligible to be granted an option under this Plan if the other company
had applied the rules of this Plan to such grant.  In the event the Company
assumes an option granted by another company, the terms and conditions of such
option will remain unchanged (except that the exercise price and the number and
nature of shares issuable upon exercise of any such option will be adjusted
appropriately pursuant to Section 424(a) of the Code).  In the event the Company
elects to grant a new option rather than assuming an existing option, such new
option may be granted with a similarly adjusted Exercise Price.

     6.   Company's Right of First Refusal.  Before any Vested Shares held by
          --------------------------------
Participant or any transferee of such Vested Shares may be sold or otherwise
transferred (including without limitation a transfer by gift or operation of
law), the Company and/or its assignee(s) shall have an assignable right of first
refusal to purchase the Vested Shares to be sold or transferred on the terms and
conditions set forth in the Exercise Agreement (the "Right of First Refusal").
The Company's Right of First Refusal will terminate when the Company's
securities become publicly traded.

                                       7
<PAGE>

     7.   Notice of Disqualifying Disposition of ISO Shares.  If the Option is
          -------------------------------------------------
an ISO, and if Participant sells or otherwise disposes of any of the Shares
acquired pursuant to the ISO on or before the later of (i) the date two (2)
years after the Date of Grant, and (ii) the date one (1) year after transfer of
such Shares to Participant upon exercise of the Option, Participant shall
immediately notify the Company in writing of such disposition. Participant
agrees that Participant may be subject to income tax withholding by the Company
on the compensation income recognized by Participant from the early disposition
by payment in cash or out of the current wages or other compensation payable to
Participant.

     8.   Compliance with Laws and Regulations.  The exercise of the Option and
          ------------------------------------
the issuance and transfer of Shares shall be subject to compliance by the
Company and Participant with all applicable requirements of federal and state
securities laws and with all applicable requirements of any stock exchange on
which the Company's Common Stock may be listed at the time of such issuance or
transfer.  Participant understands that the Company is under no obligation to
register or qualify the Shares with the SEC, any state securities commission or
any stock exchange to effect such compliance.

     9.   Nontransferability of Option.
          ----------------------------

          9.1  Nontransferability of Option.  The Option may not be transferred
               ----------------------------
in any manner other than by will or by the laws of descent and distribution or
as determined by the Committee.  The terms of the Option shall be binding upon
the executors, administrators, successors and assigns of Participant.

          9.2  All Option other than NQSO's.  All Option other than NQSO's shall
               -----------------------------
be exercisable: (i) during the Participant's lifetime, only by (A) the
Participant, or (B) the Participant's guardian or legal representative; and (ii)
after Participant's death, by the legal representative of the Participant's
heirs or legatees.

          9.3  NQSOs.  Unless otherwise restricted by the Committee, an NQSO
               -----
shall be exercisable: (i) during the Participant's lifetime only by (A) the
Participant, (B) the Participant's guardian or legal representative, (C) a
Family Member of the Participant who has acquired the NQSO by "permitted
transfer;" and (ii) after Participant's death, by the legal representative of
the Participant's heirs or legatees.  "Permitted transfer" means, as authorized
by this Plan and the Committee in an NQSO, any transfer effected by the
Participant during the Participant's lifetime of an interest in such NQSO but
only such transfers which are by gift or domestic relations order.  A permitted
transfer does not include any transfer for value and neither of the following
are transfers for value:  (a) a transfer of under a domestic relations order in
settlement of marital property rights or (b) a transfer to an entity in which
more than fifty percent of the voting interests are owned by Family Members or
the Participant in exchange for an interest in that entity.

     10.  Section 280G Excise Tax.  In the event that any Payment to Participant
          -----------------------
set forth in this Agreement is subject to the federal excise tax (the "Excise
Tax") on the type of payment defined under Section 280G(b) of the Internal
Revenue Code of 1986, as amended (the "Code"),

                                       8
<PAGE>

as determined pursuant to Section 10 of this Agreement, the Company shall pay to
Participant a tax restoration payment (the "Gross-Up Payment") equal to: (a) the
Excise Tax on the Payment, plus (b) the Excise Tax on the Gross-Up Payment, plus
(c) federal, state and local income taxes on the Gross-Up Payment, assuming that
such taxes are imposed at their highest marginal rate. All determinations with
respect to any Gross-Up Payment shall be made in accordance with Sections 10.1
through 10.5 below. For purposes of this Agreement, (i) "Accounting Firm" means
PricewaterhouseCoopers LLP or, if such firm is unable or unwilling to perform
the services contemplated by this Agreement, such other national accounting firm
as the Company and Participant shall designate by mutual agreement and (ii)
"Payment" means any payment that is described in Section 280G(b)(2) of the
Internal Revenue Code of 1986, as amended, and any successor provision thereto,
which is received by Participant hereunder whether with this Agreement or
otherwise. All Payments shall be made less applicable federal, state and local
tax withholding and payroll deductions.

          10.1  Upon prior written notice from the Participant, the Company
shall within 15 days following the consummation of a Corporate Transaction, or
the date of termination of Participant's employment, cause the Accounting Firm
to (i) make a determination whether any Payment received by Participant is
subject to the Excise Tax, and (ii) provide supporting calculations and an
analysis to Participant and the Company with respect to such a determination.
In the event that the Accounting Firm determines that any Payment received by
Participant is subject to the Excise Tax, the Company shall cause the Accounting
Firm to determine the amount of the applicable Gross-Up Payment owed to
Participant in accordance with Section 10, and the Company shall thereafter
provide such Gross-Up Payment in accordance with Section 10.2.  In the event
that the Accounting Firm determines that any Payment received by Participant is
not subject to the Excise Tax, then the Company shall cause the Accounting Firm
to provide the Company, which shall furnish Participant with a copy, with a
written opinion that the Company has substantial authority under the Code, and
the proposed, temporary and promulgated regulations under Section 280G of the
Code or any successor provision thereto, not to withhold such an Excise Tax or
report such an Excise Tax on Participant's W-2.  Any determination or opinion by
the Accounting Firm shall be binding upon Participant and the Company with
respect to whether the Company is required to provide any Gross-Up Payment to
Participant under this Section 10.1.  The Company shall pay all of the fees and
expenses of the Accounting Firm relating to any determination or opinion
required under this Section 10.1.  Notwithstanding the Accounting Firm's
determination or opinion, if a claim or notice of possible claim ultimately is
asserted by the Internal Revenue Service (the "Claim") that, if made and
successful, would subject any Payment to the Excise Tax, then Participant shall
be entitled to indemnification and the other rights and obligations as set forth
in Section 10 of this Agreement.

          10.2  In the event that the Accounting Firm determines a Gross-Up
Payment is owed to Participant under Section 10.1, the Company shall pay to
Participant the amount of the Gross-Up Payment determined by the Accounting Firm
within 10 days of the Company's receipt of such determination, subject to the
rights and obligations as set forth in Section 10 of this Agreement.

                                       9
<PAGE>

          10.3  If the initial Gross-Up Payment provided under Section 10.2 is
insufficient to cover the amount of the Excise Tax that is ultimately determined
pursuant to a Claim to be owed by Participant with respect to any Payment (an
"Underpayment"), the Company, after exhausting its remedies under Section 10.4,
shall promptly pay to Participant an additional Gross-Up Payment in respect of
the Underpayment.  If the initial Gross-Up Payment provided under Section 10.2
is in excess of the amount necessary to cover the Excise Tax that is ultimately
determined pursuant to a Claim to be owed by Participant with respect to any
Payment (an "Overpayment"), the Participant shall promptly repay to the Company
an amount equal to the Overpayment within 10 business days of the Company's
request for such repayment.

          10.4  The following procedures shall apply to the Parties with respect
to their respective rights and obligations under Section 10 of this Agreement in
the event of any Claim (as defined in Section 10.1):

                10.4.1  Participant shall notify the Company of any Claim,
irrespective of whether any Gross-Up Payment previously has been provided by the
Company to Participant.  Such notice shall be given within 10 days after
Participant knows of such Claim, and shall apprise the Company of the nature of
the Claim and the date on which the Claim is requested to be paid, and shall
include complete copies of all notices or communications received by the
Participant from the Internal Revenue Service or its representatives with
respect to the Claim.  Participant agrees not to pay the Claim until the
expiration of the 30-day period following the date on which Participant notifies
the Company, or such shorter period ending on the date the Taxes with respect to
such Claim are due (the "Notice Period").  Participant's failure to timely
notify the Company of any claim as required by this Section 10.4.1 shall result
in a waiver of Participant's rights under this Section 10.

                10.4.2  If the Company notifies Participant prior to the
expiration of the Notice Period that it desires to contest the Claim,
Participant shall: (a) provide the Company with any information reasonably
requested by the Company relating to the Claim; (b) take such action in
connection with the Claim as the Company may reasonably request, including,
without limitation, accepting legal representation with respect to such Claim by
attorneys selected by the Company; (c) cooperate with the Company in good faith
in contesting the Claim; and (d) permit the Company to participate in any
proceedings relating to the Claim.

                10.4.3  If the Company does not notify Participant prior to the
end of the Notice Period of the Company's desire to contest the Claim, and if
the Company previously has not provided Participant with an initial Gross-Up
Payment under Section 10.2, the Company shall pay to Participant a Gross-Up
Payment or an additional Gross-Up Payment, as the case may be, in respect of any
Payment that is subject of the Claim; provided, however, that Participant shall
immediately pay the amount of the Excise Tax that is the subject of the Claim to
the applicable taxing authority in accordance with applicable law, and
Participant shall release, indemnify and hold the Company harmless from any
costs, expenses, penalties, fines, interest or other liabilities with respect to
Participant's failure to pay such Excise Tax as required under this Section
10.4.3.

                                       10
<PAGE>

                10.4.4  If the Company notifies Participant of the Company's
desire to contest the Claim, and if thereafter requested by the Company,
Participant shall either pay the federal, state and local income taxes to which
he is subject at the time of determination, calculated on the basis of the
highest marginal rates then in effect, plus any additional payroll or
withholding taxes to which Participant is then subject (the "Taxes") claimed in
respect of the Excise Tax and timely sue for a refund, or timely contest the
Claim in any permissible manner and prosecute such contest to a determination
before any administrative tribunal, in a court of initial jurisdiction, and in
one or more appellate courts as the Company shall determine in its sole
discretion; provided, however, that if the Company directs Participant to pay
such Claim and pursue a refund, the Company shall advance the amount of such
payment to Participant on an after-tax and interest-free basis (the "Advance"),
subject to the rights and obligations under Section 10.5.

                10.4.5  Participant shall permit the Company to control all
proceedings related to the Claim and, at the Company's option, permit the
Company to pursue or forgo any and all administrative appeals, proceedings,
hearings, and conferences with the taxing authority in respect of such Claim.
The Company's control of the contest and proceedings related to the Claim shall
be limited to the issues related to the Excise Taxes and Gross-Up Payments, and
Participant shall be entitled to settle or contest, as the case may be, any
other unrelated issues raised by the Internal Revenue Service or other taxing
authority.

          10.5  If, after receipt by Participant of an Advance under Section
10.4.4 of this Agreement, Participant becomes entitled to a refund with respect
to the Claim to which such Advance relates, Participant shall pay to the Company
the amount of the refund (together with any interest paid or credited thereon
after Taxes applicable thereto). However, if after receipt by Participant of an
Advance, a determination is made that Participant shall not be entitled to any
refund with respect to the Claim and the Company does not promptly notify
Participant of its intent to contest the denial of refund, then the amount of
the Advance shall not be required to be repaid by Participant and the amount
thereof shall offset the amount of any additional Gross-Up Payment then owing to
Participant.

          10.6  The Company shall indemnify Participant and hold Participant
harmless, on an after-tax basis, from any costs, expenses, penalties, fines,
interest or other liabilities (the "Losses") incurred by Participant with
respect to the exercise by the Company of any of its rights under this Section
10, including, without limitation, any Losses related to the Company's decision
to contest a Claim or any imputed income to Participant resulting from any
Advance or action taken on Participant's behalf by the Company pursuant to this
Section 10. The Company shall pay all reasonable legal fees and expenses
incurred by the Company under this Section 10, and shall promptly reimburse
Participant for the reasonable expenses incurred by Participant in connection
with any actions taken by the Company or required to be taken pursuant to this
Section 10.

     11.  Privileges of Stock Ownership.  Participant shall not have any of
          -----------------------------
the rights of a stockholder with respect to any Shares until the Shares are
issued to Participant.

                                       11
<PAGE>

     12.  Tax Consequences.  Set forth below is a brief summary as of the
          ----------------
Effective Date of the Plan of some of the federal and California tax
consequences of exercise of the Option and disposition of the Shares.  THIS
SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT
TO CHANGE.  PARTICIPANT SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THE
OPTION OR DISPOSING OF THE SHARES.

          12.1  Exercise of Nonqualified Stock Option.  There may be a regular
                -------------------------------------
federal and California income tax liability upon the exercise of the Option.
Participant will 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 Shares on the date of exercise over the Exercise Price.  If Participant
is a current or former employee of the Company, the Company may be required to
withhold from Participant's compensation or collect from Participant and pay to
the applicable taxing authorities an amount equal to a percentage of this
compensation income at the time of exercise.

          12.2  Disposition of Shares.  The following tax consequences may apply
                ---------------------
upon disposition of the Shares.

                (a) Nonqualified Stock Option.  If the Shares are held for more
                    -------------------------
than twelve (12) months after the date of purchase of the Shares pursuant to the
exercise of an NQSO, any gain realized on disposition of the Shares will be
treated as long term capital gain.

                (c) Withholding.  The Company may be required to withhold from
                    -----------
the Participant's compensation or collect from the Participant and pay to the
applicable taxing authorities an amount equal to a percentage of this
compensation income.

     13.  Interpretation.  Any dispute regarding the interpretation of this
          --------------
Agreement shall be submitted by Participant or the Company to the Committee for
review.  The resolution of such a dispute by the Committee shall be final and
binding on the Company and Participant.

     14.  Entire Agreement.  The Plan is incorporated herein by reference.
          ----------------
This Agreement and the Plan constitute the entire agreement of the parties and
supersede all prior undertakings and agreements with respect to the subject
matter hereof, including but not limited to the continued vesting provisions in
Section 3 of the Employment and Non-Compete Agreement between Participant and
the Company dated January 15, 1998.

     15.  Notices.  Any notice required to be given or delivered to the Company
          -------
under the terms of this Agreement shall be in writing and addressed to the
Corporate Secretary of the Company at its principal corporate offices. Any
notice required to be given or delivered to Participant shall be in writing and
addressed to Participant at the address indicated above or to such other address
as such party may designate in writing from time to time to the Company. All
notices shall be deemed to have been given or delivered upon: (i) personal
delivery; (ii) three (3) days after deposit in the United States mail by
certified or registered mail (return receipt

                                       12
<PAGE>

requested); (iii) one (1) business day after deposit with any return receipt
express courier (prepaid); or (iv) one (1) business day after transmission by
facsimile, rapifax or telecopier.

     16.  Successors and Assigns.  The Company may assign any of its rights
          ----------------------
under this Agreement or the Exercise Agreement.  This Agreement shall be binding
upon and inure to the benefit of the successors and assigns of the Company.
Subject to the restrictions on transfer set forth herein, this Agreement shall
be binding upon Participant and Participant's heirs, executors, administrators,
legal representatives, successors and assigns.

     17.  Governing Law.  This Agreement shall be governed by and construed
          -------------
in accordance with the laws of the State of Delaware as such laws are applied to
agreements between Delaware residents entered into and to be performed entirely
within Delaware.  If any provision of this Agreement is determined by a court of
law to be illegal or unenforceable, then such provision will be enforced to the
maximum extent possible and the other provisions will remain fully effective and
enforceable.

     18.  Acceptance.  Participant hereby acknowledges receipt of a copy of the
          ----------
Plan and this Agreement. Participant has read and understands the terms and
provisions thereof, and accepts the Option subject to all the terms and
conditions of the Plan and this Agreement. Participant acknowledges that there
may be adverse tax consequences upon exercise of the Option or disposition of
the Shares and that Participant should consult a tax adviser prior to such
exercise or disposition.

     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed in
triplicate by its duly authorized representative and Participant has executed
this Agreement effective as of the Date of Grant.

HOSTPRO, INC.                               PARTICIPANT

By: /s/                                     By:  /s/
Name:   James R. Stewart
Title:  Senior Vice President & CFO
Date:   March 21, 2001

                                       13

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