Document:

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                                                                   Exhibit 10.26

                                November 22, 2000

Mr. Shawn P. McGhee
953 East Riverwalk
Memphis TN 38120

Dear Mr. McGhee:

This letter agreement (the "Agreement") sets forth the terms and conditions of
your employment with PurchasePro.com, Inc. (the "Company"). In consideration of
the mutual covenants and promises made in this Agreement, you and the Company
agree as follows:

1.  Employment. Commencing as of the date hereof (the "Effective Date"), you
will serve as the Chief Operating Officer of PurchasePro.com, or in any other
position assigned by the Company, provided that, during the term of your
employment, you shall not be required to serve in any positions, or take any
title or duties, subordinate to that or those of Chief Operating Officer of
the Company or any equivalent. As Chief Operating Officer, you will have such
duties, responsibilities and authority as are appropriate to such position.
Throughout the term of your employment, you will devote such business time
and energies to the business and affairs of the Company as needed to carry
out your duties and responsibilities, subject to the overall supervision of
the company's Chief Executive Officer and/or President of the Company.

2.  Term. The initial term of this Agreement will commence on the Effective
Date and shall continue for two (2) years thereafter. The term of this
Agreement shall be automatically renewed for up to two additional one-year
periods unless either party gives the other party at least 120 days' prior
written notice of its intention to terminate this Agreement at the end of
either the initial term hereof or the first such renewal period. During the
term of this Agreement, your employment with the Company will be "at-will."
Either you or the Company can terminate your employment at any time and for
any reason, with or without cause and with or without notice, in each case
subject to the terms and provisions of paragraph 7 below.

3.  Salary. For your services to the Company, you will be paid a base salary,
payable in accordance with the Company's usual payroll practices during your
employment, at an annualized rate of at least $200,000 per year, subject to
adjustment upon the agreement of the parties. In addition, you will be
eligible to receive a discretionary bonus in respect of each calendar year or
portion thereof during which you are employed hereunder, to be determined
solely by the Company.

4.  Employee Benefit Programs. During your employment, you will be entitled
to participate in all Company employee benefit plans and compensation and
perquisite programs made available to the Company's executives or salaried
employees generally. You will be entitled to four weeks of personal time off
per year, provided that you will not accrue unused vacation of more than five
weeks.

5.  Stock Options. On the Effective Date, the Company will issue to you an
option (collectively, "Stock Options") to acquire up to 500,000 shares of the
Company's Common Stock ("Shares") in accordance herewith and otherwise under
the Company's stock-based incentive plan (the "Plan"), at a price per share
equal to the Fair Market Value (as such term is defined in the Plan) on the
Effective Date (subject to SEC rules and restrictions imposed upon the
officers and major shareholders of the Corporation), as set forth in an
option agreement between you and the Company in the form attached hereto as
Exhibit A.

6.  Performance-Based Stock Option Bonus Grants in 2001. In addition to those
options set forth in paragraph 5, if the Company achieves certain total
revenue targets during the fiscal year ended December 31, 2001, the Company
will issue to you additional Stock Options, in accordance herewith and
otherwise under the Plan, as follows: If the Company records total revenue
exceeding $100 million for the six months ended June 30, 2001 as reported in
the Company's Quarterly Report on Form 10-Q filed with the Securities and
Exchange Commission ("SEC") for the period ended on such date, the Company
will, as of that date, issue to you Stock Options to purchase an additional
100,000 Shares ("Initial Performance-Based Options") at a price per share
equal to the Fair Market Value on the date of such grant ("Initial
Performance Grant Date"). The Initial Performance-Based Options will have a
term of 10 years measured from the Initial Performance Grant Date, subject to
earlier termination following termination of your employment as set forth in
the form of options attached hereto as Exhibit A, and shall vest and become
exercisable as follows: (i) Stock Options on 50,000 Shares shall vest six
months after the Initial Performance Grant Date and (ii) Stock Options on
50,000 Shares shall vest 12 months after the Initial Performance Grant Date,
and otherwise in accordance with the form of options attached hereto as
Exhibit A. Further, if the Company achieves

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total revenue exceeding $250 million for the twelve months ended December 31,
2001 as reported in the Company's Annual Report on Form 10-K filed with the SEC
for the fiscal year ended on such date, the Company will issue to you Stock
Options to purchase an additional 200,000 Shares ("Subsequent Performance-Based
Options") at a price per share equal to the Fair Market Value on the date of
such grant (the "Subsequent Performance Grant Date"). The Subsequent
Performance-Based Options will have a maximum term of 10 years measured from the
Subsequent Performance Grant Date, subject to earlier termination following
termination of your employment as set forth in the form of options attached
hereto as Exhibit A, and will vest and become exercisable as follows: (i) Stock
Options on 50,000 Shares shall vest six months after the Subsequent Performance
Grant Date, (ii) Stock Options on 50,000 Shares shall vest 12 months after the
Subsequent Performance Grant Date, (iii) Stock Options on 50,000 Shares shall
vest 18 months after the Subsequent Performance Grant Date and (iv) Stock
Options on 50,000 Shares shall vest 24 months after the Subsequent Performance
Grant Date, and otherwise in accordance with the form of options attached hereto
as Exhibit A. Notwithstanding the foregoing, the Company shall not be obligated
to make any grant of Initial Performance-Based Options or Subsequent
Performance-Based Options in the event your employment was terminated for any
reason prior to commencement of the Company's last fiscal quarter included in
determining whether the total revenue target was met for the applicable period.
In addition to the foregoing, other relevant terms and conditions related to the
grant of Stock Options will be set forth in an option agreement between you and
the Company substantially in the form attached hereto as Exhibit A, adjusted as
necessary to reflect the terms of the foregoing.

7.  Consequences of Termination of Employment.

      (a) For Cause. If the Company terminates your employment for Cause you
will be entitled to any unpaid salary, bonus and paid time off due you pursuant
to paragraphs 3, 4 and 7 above through the date of termination, and you will be
entitled to no other compensation from the Company. "Cause" will exist in the
event you: (i) willfully breach this Agreement, which breach is not cured within
30 days following written notice from the Company; (ii) engage in conduct
constituting willful dishonesty toward, fraud upon, or deliberate or attempted
injury to the Company; or (iii) are negligent in the performance of your duties,
which negligence is not cured within 30 days following written notice from the
Company.

      (b) Other than for Cause. If the Company terminates your employment for
reasons other than Cause, or if you terminate your employment because the
Company breaches any of its obligations under this Agreement, which breach is
not cured within 30 days following written notice from you, you will be entitled
to any unpaid salary, bonus and paid time off due you pursuant to paragraphs 3,
4 and 7 above through the date of termination, plus twelve months of your base
salary in effect at the date of your termination of employment. You will not be
entitled to any other compensation from the Company.

      (c) Voluntary Termination. If you terminate your employment with the
Company of your own volition, other than as set forth in paragraph 7(b), such
termination will have the same consequences as a termination for Cause under
subparagraph (a) above.

            (d) Change in Control. You will vest immediately in all unvested
options theretofore issued to you, hereunder or otherwise, and will be entitled
to twelve months of your base salary in effect at the date of a Change in
Control of the Company (as such term is defined in the Plan) in the event within
one year after such Change of Control (i) the Company terminates your employment
for any reason other than for Cause, or (ii) you resign from the Company for any
one of the following reasons: (A) the Company breaches any of its obligations to
you under this Agreement and such a breach is not cured within 30 days' written
notice by you; (B) the Company changes your title, working conditions or duties
such that your powers, duties or working conditions are diminished, reduced or
otherwise changed to include powers,

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duties, or working conditions which are not generally consistent with your
title, continuing after written notice and 30 days to cure; or (C) the Company
relocates your primary place of employment outside of the Las Vegas metropolitan
area.

            (e) Death or Disability. If your employment with the Company
terminates as a result of your death or Total and Permanent Disability (as
defined in Section 2(x) of the Plan, such termination will have the same
consequences as a termination by the Company other than for Cause under
subparagraph (b) above.

            (f) Release of Claims. As a condition to the receipt of the payments
described in this paragraph 7, you shall be required to execute a release of all
claims arising out of your employment or the termination thereof including, but
not limited to, any claim of discrimination under state or federal law, but
excluding claims for contribution and indemnification from the Company under any
indemnification agreement with the Company, its certificate of incorporation and
by-laws or applicable law or claims for directors and officers' insurance
coverage.

            (g) Conditions to Receipt of Payments and Benefits. In view of your
position and access to proprietary information, as a condition to the receipt of
payments described in this paragraph 7, you shall not, without the Company's
written consent, directly or indirectly, alone or as a partner, joint venturer,
officer, director, employee, consultant, agent or stockholder (other than a less
than 5% stockholder of a publicly traded company), within one year of your date
of termination from the Company (i) engage in any activity which is in
competition with the business, the products or services of the Company, (ii)
solicit any of the Company's employees or consultants, or customers (with
respect to such business, products and services), (iii) hire any of the
Company's employees or consultants in an unlawful manner or actively encourage
employees or consultants to leave the Company, or (iv) otherwise breach your
proprietary information obligations. You agree to execute and comply with the
form of proprietary information agreement adopted by the Company.

8.  Assignability; Binding Nature. Commencing on the Effective Date, this
Agreement will be binding upon you and the Company and your respective
successors, heirs, and assigns. This Agreement may not be assigned by you
except that your rights to compensation and benefits hereunder, subject to
the limitations of this Agreement, may be transferred by will or operation of
law. No rights or obligations of the Company under this Agreement may be
assigned or transferred except by operation of law in the event of a merger
or consolidation in which the Company is not the continuing entity, or the
sale or liquidation of all or substantially all of the assets of the Company,
provided that the assignee or transferee is the successor to all or
substantially all of the assets of the Company and assumes the Company's
obligations under this Agreement contractually or as a matter of law.

9.  Governing Law. This Agreement will be deemed a contract made under, and
for all purposes shall be construed in accordance with, the laws of Nevada
applicable to agreements made and fully to be performed therein by residents
thereof.

10.  Arbitration. The parties agree that any disputes arising out of or
related to the Agreement shall be resolved by using the following procedures:

      (a) The party claiming to be aggrieved shall furnish to the other party a
written statement of the grievance and the relief requested or proposed.

      (b) If the other party does not agree within 30 days after receipt of the
written statement referred to in paragraph 10(a) to furnish the relief requested
or proposed, or otherwise

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does not satisfy the demand of the party claiming to be aggrieved, the parties
shall submit the dispute to non-binding mediation before a mediator to be
jointly selected by the parties, provided that, if a single mediator cannot be
chosen jointly by the parties within 10 days after the expiration of the 30-day
period referred to above, each party shall designate a mediator and the two
mediators shall choose a third to conduct the mediation.

      (c) If the mediation does not produce a resolution of the dispute, the
parties agree that the dispute shall be resolved by final and binding
arbitration in Las Vegas, Nevada. The parties shall attempt to agree to the
identity of an arbitrator, and, if they are unable to do so, they will obtain a
list of arbitrators from the Judicial Arbitration and Mediation Service and
select an arbitrator by striking names from that list. The arbitrator shall have
the authority to determine whether the conduct complained of violates the rights
of the complaining party and, if so, to grant any relief authorized by law. The
arbitrator shall not have the authority to modify, change or refuse to enforce
the terms of this Agreement.

      (d) Arbitration shall be the exclusive final remedy for any dispute
between the parties, and the parties agree that no dispute shall be submitted to
arbitration where the party claiming to be aggrieved has not complied with the
preliminary steps provided for above, provided however, that this Section 10
shall not be construed to eliminate or reduce any right the Company or the
Executive may otherwise have to seek and obtain from a court a temporary
restraining order or a preliminary or permanent injunction to enforce the
restrictions of subparagraph 5(f) of this Agreement. The parties agree that the
arbitration award shall be enforceable in Clark County Superior Court so long as
the arbitrator's findings of fact are supported by substantial evidence on the
whole and the arbitrator has not made errors of law.

11.  Withholding. Anything to the contrary notwithstanding, following the
Effective Date all payments made by the Company hereunder to you or your
estate or beneficiaries will be subject to tax withholding pursuant to any
applicable laws or regulations. In lieu of withholding, the Company may, in
its sole discretion, accept other provision for payment of taxes as required
by law, provided it is satisfied that all requirements of law affecting its
responsibilities to withhold such taxes have been satisfied.

12.  Entire Agreement. This Agreement contains all the legally binding
understandings and agreements between you and the Company pertaining to the
subject matter of this Agreement and supersedes all other agreements, whether
oral or in writing, previously entered into between the parties.

13.  Miscellaneous. No provision of this Agreement may be amended or waived
unless such amendment or waiver is agreed to by you and the Chief Executive
Officer or President of the Company in writing. No waiver by you or the
Company of the breach of any condition or provision of this Agreement will be
deemed a waiver of a similar or dissimilar provision or condition at the same
or any prior or subsequent time. In the event any portion of this Agreement
is determined to be invalid or unenforceable for any reason, the remaining
portions shall be unaffected thereby and will remain in full force and effect
to the fullest extent permitted by law.

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Please indicate your acceptance and understanding of the terms of this Agreement
by signing and dating below.

                                                Sincerely,

                                                PURCHASEPRO.COM, INC.

                                                By
                                                   -----------------------------

                                                Its
                                                   -----------------------------

ACKNOWLEDGED AND AGREED:

-------------------------------
Dated: November 22, 2000<PAGE>

                                                                   Exhibit 10.20

                                STATEMENT OF WORK

                                                          AGREEMENT # 4900CS0965
                                                                SOW # 4900OP0312
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This Statement of Work ("SOW") adopts and incorporates by reference the terms
and conditions of Agreement # 4900CS0965 (the "Agreement") between Supplier and
Buyer. Transactions performed under this SOW will be conducted in accordance
with and be subject to the terms and conditions of this SOW, the Agreement and
any applicable Work Authorizations ("WAs"). This SOW is not a WA. Capitalized
terms used and not defined herein shall have the meanings specified in the
Agreement.

      1.0 SCOPE OF WORK

Supplier will provide, as directed by Buyer, expert consultants reasonably
satisfactory to Buyer to provide the Deliverables and perform the Services for
up to 420,000 hours over the term of this SOW for certain customers of the Buyer
("Buyer's Customers"). The number of consultants, and the mix of skill levels
shall be determined by Buyer in Buyer's sole discretion as initially set forth
on Exhibit VIII and adjusted as provided in this SOW. It is the intention of the
parties that within 12 months of the date hereof, there will be up to 70
Supplier Personnel performing services for the Buyer under the terms of this
SOW.

Buyer will be the sole interface to Buyer's Customer and be responsible for all
correspondence, contracts, resource allocation and the like, provided however
that Buyer shall consult with Supplier with regard to resource allocation and
provided further that if Supplier's Personnel are providing services at Buyer's
Customer's facility, Supplier's Personnel may have contact with Buyer's Customer
in the course of providing services to Buyer's Customer at the facility of
Buyer's Customer. Supplier will provide on site services to Buyer Customers in
support of Buyer's WebSphere projects.

      2.0 DESCRIPTION OF DELIVERABLES AND SERVICES

      2.1 The Services shall include the services described in Exhibit I annexed
to and made a part of this SOW. Exhibit I may be revised from time to time by
the mutual written consent of the Buyer and Supplier.

      2.2 The Deliverables under this SOW will be all documents, software and
other intellectual capital created during the performance of the Services,
including, without limitation, (1) any code, documentation, suggestions or
recommendations provided to Buyer or any of Buyer's Customers during the term of
this SOW; and (2) Consultant Activity Records, substantially in the form of
Exhibit II annexed to and made a part of this SOW (each a "CAR"), detailing
Supplier's activities under this SOW. All Deliverables provided under this SOW
shall be considered Developed Works. Supplier's Preexisting Materials may be
used in delivering services or included in deliverables under the SOW and
nothing in this Agreement shall be interpreted so as to preclude Supplier from
reusing such Preexisting Materials as part of a deliverable for other Buyer
Customers or other customers of Supplier. No background materials or Program
Products will be provided by Supplier under this SOW.

      2.3 In order to perform the Services, certain information of Buyer's
Customer's will be made available to Supplier, which information may include but
is not limited to, requirements documents, system architecture, application
architecture and application code ("Information"). Supplier's use of the
Information shall be governed by the terms of the Agreement for Exchange of
Confidential Information # 4900OP0257, by and between Buyer and Supplier.

      3 EDUCATION AND TRAINING

      3.1 Supplier shall cause Supplier Personnel to receive the training
described in Exhibit III annexed to and made part of this SOW (the "Services
Training"). The Skills and Experience as outlined in Exhibit V coupled with the
Services Training or equivalent existing, demonstrated WebSphere Field
Experience as outlined in Exhibit I is required for Supplier to perform the
Services.

      3.2 Buyer shall provide training to five (5) Supplier Personnel designated
by Supplier (the "Supplier Instructors") to enable the Supplier Instructors to
provide the Services Training to other Supplier Personnel engaged to perform the
Services. This applies for those classes described in Exhibit III that begin
with SW only. The other classes described in Exhibit III are not covered under
this SOW. Supplier shall begin to deliver Services Training to Supplier
Personnel through the Supplier Instructors as soon as reasonably practicable,
but in no event later than January 1, 2001. Supplier shall not invoice Buyer for
any time spent by any of Supplier Personnel receiving the Services Training nor
for any time spent by any of the Supplier Instructors delivering the Serv-

                                  Page 1 of 7
<PAGE>

                                STATEMENT OF WORK

                                                          AGREEMENT # 4900CS0965
                                                                SOW # 4900OP0312
--------------------------------------------------------------------------------
ices Training to Supplier's employees. Supplier shall pay Buyer $___ for each
student kit delivered to Supplier Personnel by Supplier Instructors. .

      3.3 Until such time as the Supplier Instructors begin to deliver the
Services Training to Supplier Personnel as set forth in Section 3.2., Buyer
shall deliver the Services Training to Supplier Personnel at no charge to
Supplier. Supplier shall not invoice Buyer for any of the time spent by Supplier
Personnel receiving Supplier Training pursuant to this Section 3.3.

      4 SUPPLIER RESPONSIBILITIES

4.1 During the term of this SOW and for a period of six months following the end
of the term of this SOW Supplier will not, without the prior written consent of
Buyer (1) perform services similar to the Services for any of Buyer's Customers
for whom Supplier has performed Services pursuant to this SOW, or (2) solicit
for employment any of Buyer's employees employed in Buyer's AIM unit. As used in
this paragraph 4.1, the term "Buyer's Customer" does not include any business
entities that Supplier had an independent relationship with prior to entering
into this SOW.

4.2 During the term of this SOW, and subject to Section 6.1 and subject to Buyer
fulfilling its obligations pursuant to Section 5.1. Supplier Personnel who have
completed the Supplier Training and are listed on Exhibit VIII are for the
exclusive use of Buyer and during such time cannot be utilized by Supplier for
any other engagement without Buyer's prior written consent. In the event that
any individual Supplier Personnel is being utilized at less than the 80%
utilization rate, Buyer may temporarily release such Supplier Personnel from the
exclusivity requirement set forth in this section to staff Supplier engagements.
Such Supplier Personnel shall not be removed from Exhibit VIII except pursuant
to Section 6 hereof and Buyer shall continue to have a Utilization Guarantee
Payment obligation with respect to such temporarily released Supplier Personnel
provided that the hours utilized by Supplier for such released Supplier
Personnel will count as actual hours worked toward guaranteed utilization but
Supplier will not be compensated for such hours by Buyer .

4.3 If Supplier is engaged in any activity on Buyer premises pursuant to this
SOW, Supplier shall comply with the terms and conditions set forth in Exhibit
IV.

4.4 The Supplier Coordinator set forth in Section 9 of this SOW shall act as
Supplier's single point of contact with Buyer's Technical Coordinator set forth
in Section 9 of this SOW to process work assignments and assist with placement
of Supplier's employees in Supplier Training sessions.

4.5 Supplier represents and warrants to Buyer that the Supplier Personnel
performing the Services shall possess the Skill and Experience described in
Exhibit V annexed to and made a part of this SOW. Buyer may request that
Supplier remove any of Supplier's Personnel that, in Buyer's sole reasonable
discretion, do not possess the Skill and Experience described in Exhibit V.
Supplier shall promptly remove such Supplier Personnel and provide to Buyer
Supplier Personnel possessing such requisite Skill and Experience. At such time,
Buyer may opt to remove from Exhibit VIII said personnel that do not possess
Skill and Experience as described in Exhibit V. Removal of said personnel does
not cause a breach of this SOW.

4.6 If during the Term of this Agreement the Supplier receives an offer to enter
into a transaction which would result in or constitute a Change of Control (a
"Change of Control Transaction") as such term is defined in Section 12.0 or
commences discussions to enter into a Change of Control Transaction, the
Supplier shall give notice to Buyer in writing (the "First Offer Notice") at
least forty-five (45) calendar days prior to signing a definitive agreement for
the Change of Control Transaction.

5 BUYER RESPONSIBILITIES

5.1 Effective as of January 1, 2001, Buyer will utilize the aggregate pool of
Supplier Personnel (listed on Exhibit VIII) authorized to work under this SOW at
no less than 80% of a full-time equivalent. For the purposes of this SOW,
"full-time equivalent" shall mean Supplier Personnel working eight hours per
day, five days per week, fifty weeks per year.

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<PAGE>

                                STATEMENT OF WORK

                                                          AGREEMENT # 4900CS0965
                                                                SOW # 4900OP0312
--------------------------------------------------------------------------------
5.2 Buyer will provide support to Supplier Personnel as may be reasonably
necessary for Supplier to perform the Services including but not limited to hot
line support for WebSphere, copies of beta code for WebSphere that might address
software problems or issues, an annual meeting with the WebSphere Consulting
Team and such other resources as Buyer determines are reasonably necessary.

5.3 During the term of this SOW and for a period of six months following the end
of the term of this SOW, Buyer will not, without the prior written consent of
Supplier solicit for employment any of Supplier's employees who perform work for
Buyer or Buyer's Customers pursuant to this SOW, provided, however, in the event
of a Change of Control of Supplier, involving a party (or any of the other
parties, if more than one) who has a substantial portion of its business in the
web application server product and services market and is not engaged in
business primarily as a professional services/consulting firm or systems
integrator, resulting in a termination of this SOW by Buyer, then the
prohibition provided in this Section 5.3 shall cease immediately upon the
effectiveness of such termination.

6 EXHIBIT VIII

6.1 (i) As soon as reasonably practicable upon the execution of this SOW by
Buyer and Supplier, Buyer shall advise Supplier of the number of Supplier
Personnel Buyer shall initially require to perform Services under this SOW.
Supplier shall promptly provide Buyer with a list of Supplier Personnel that
possess demonstrated WebSphere experience at least equivalent to Skills and
Experience outlined in Exhibit V and the Services Training, and such other
information substantially in the form of Exhibit VIII.

      (ii) Buyer may from time to time request in writing that Supplier provide
additional Supplier Personnel with the requisite Skills and Experience as
outlined in Exhibit V and the Supplier Training or equivalent, existing,
demonstrated WebSphere field experience to perform Services under this SOW, and
Supplier shall use best efforts to provide such Supplier Personnel and add such
Supplier Personnel to Exhibit VIII within thirty (30) days of Buyer's request.

      (iii) Buyer may from time to time request, upon sixty (60) days prior
written notice to Supplier, that Supplier remove any number of Supplier
Personnel from performing Services under this SOW and remove such Supplier
Personnel from Exhibit VIII, and Supplier shall comply with such request,
provided however, reductions to Exhibit VIII may not exceed one-third (1/3) of
Supplier Personnel on Exhibit VIII in any sixty (60) day period, unless Supplier
advises Buyer that it has identified alternative assignments for the Supplier
Personnel to be removed from Exhibit VIII.

      (iv) Buyer may from time to time request that Supplier immediately remove
any Supplier Personnel from performing Services under this SOW and remove such
Supplier Personnel from Exhibit VIII who do not possess skills and experience as
described in Exhibit V coupled with the completed Supplier Training or do not
possess equivalent, demonstrated WebSphere field experience (subject to
Supplier's right to replace such removed Supplier Personnel as provided in
Section 4.5).

      (v) Supplier and Buyer may at any time remove Supplier Personnel from
performing Services under this SOW and remove such Supplier Personnel from
Exhibit VIII by mutual written consent.

      (vi) Supplier may from time to time remove from Exhibit VIII (a) Supplier
Personnel that no longer are employed by Supplier, and (b) upon thirty (30) days
prior written notice to Buyer, Supplier Personnel for which Supplier reasonably
believes there is a significant risk that such Supplier Personnel will terminate
his/her employment with Supplier because of dissatisfaction with his/her work
assignments or (c) Supplier personnel that for whatever reason are not tracking
at 80% utilization with the written consent of the Buyer.

7 SCHEDULE

7.1 The term of this SOW will commence on October 15, 2000 ("Commencement Date")
and terminate on August 31, 2003 (the "Term"), subject to the provisions of
Section 3.0 of the Agreement. During the Term, Buyer will pay Supplier only for
actual hours worked, as documented by Supplier in a CAR and the Utilization
Guarantee Payment, if due, as outlined under Section 7. Subject to the
provisions of Section 3.0 of the Agreement, in the event that the aggregate pool
of Supplier Personnel listed on Exhibit VIII actual hours worked each calendar

                                  Page 3 of 7
<PAGE>

                                STATEMENT OF WORK

                                                          AGREEMENT # 4900CS0965
                                                                SOW # 4900OP0312
--------------------------------------------------------------------------------
year included in the Term are equal to or exceed 1600 hours multiplied by the
number of Supplier Personnel in the pool (prorated for those in the pool less
than the entire calendar year), no payments other than for actual hours worked
shall be due to Supplier by Buyer. In the event Supplier's actual hours worked
upon expiration of each calendar year included in the Term are less than 1600
hours multiplied by the number of Supplier Personnel in the pool (prorated for
those in the pool less than the entire calendar year), Buyer shall pay Supplier
the difference between the actual hours worked and 1600 hours multiplied by the
number of Supplier Personnel in the pool (prorated for those in the pool less
than the entire calendar year), at the hourly rate of $___ per hour (subject to
rate negotiation as outlined in Section 8.3) ("Utilization Guarantee Payment"),
subject to the following:

      o Supplier will document and submit to Buyer a weekly CAR indicating
actual hours worked and actual hours on-call, but not working.

      o Buyer may use consultants listed on Exhibit VIII for internal projects
at the same rates outlined in Exhibit VI and any such hours worked shall be
counted towards the utilization guarantee.

      o Supplier's assigned consultants are expected to work 5 days per week, 8
hours per day (or equivalent -- e.g. Supplier Personnel may, at Buyer's request,
work four ten-hour days). In the event the consultant is unwilling or unable to
accept an assignment, Supplier will not be compensated for those hours and such
hours shall be counted as actual hours worked. After personnel are added to
Exhibit VIII Training/Education time incurred, total vacation days exceeding two
weeks will count as actual hours worked toward guaranteed utilization and will
not be compensated for by Buyer. Upon mutual written agreement the consultant
may work more then 40 billable hours in a week.

      o Beginning January 1, 2003 through end of the Term, the number of hours
used to calculate payments as provided in this Section 7.1 shall be 1067 hours
(and not 1600).

8 PAYMENTS

8.1 Buyer will pay Supplier for the Services described in this SOW as set forth
in Exhibit VI annexed to and made a part of this SOW and otherwise in accordance
with the terms of this SOW. Notwithstanding anything herein to the contrary,
Buyer is obligated to make a Utilization Guarantee Payment with respect to each
calendar year during the term, (i) whether or not a WA is issued and (ii) with
respect to any applicable period during the term on a prorated basis through the
effective date of the termination of the SOW, within 30 days after the effective
date of termination of the SOW.

8.2 Buyer will reimburse Supplier for actual and reasonable travel and living
expenses in accordance with the Exhibit VII: Exhibit for Travel Expenses annexed
to and made a part of this SOW. The Buyer maximum reimbursable hotel and meal
limit rates will be provided to Supplier by Buyer for each Buyer Customer
location. Services performed by Supplier Personnel within 50 miles of the
residence of such Supplier Personnel shall be considered local travel. Buyer
shall not reimburse Supplier for local travel or living expenses.

8.3 The rates described in Exhibit VI shall apply for Services under this SOW
through and including September 1, 2001. For Services performed thereafter,
Buyer and Seller shall, in good faith, negotiate new rates for the next one year
period. If Buyer and Supplier are unable to agree on such new rates by September
1, 2001, then either Buyer or Supplier may terminate this SOW in accordance with
Section 11 of this SOW.

8.4 Total compensation under this SOW shall not exceed $ 73.5 Million, plus
actual and reasonable travel and living expenses.

8.5 Buyer will pay Supplier the Utilization Guarantee Payment (calculated in
accordance with Section 7) attributable to each calendar year during the Term,
at the end of such calendar year, within 45 days of receipt of an invoice from
Supplier setting forth the calculation thereof.

                                  Page 4 of 7
<PAGE>

                                STATEMENT OF WORK

                                                          AGREEMENT # 4900CS0965
                                                                SOW # 4900OP0312
--------------------------------------------------------------------------------

9 COMMUNICATIONS

For purposes of this SOW:
Buyer Technical Coordinator:                        Procurement Buyer
Michael Curtin                                      Bill Land
IBM Corporation                                     IBM Corporation
4205 South Miami Blvd                               3039 Cornwallis Road
RTP, NC 27709                                       RTP, NC 27709
Phone: 919-254-9600                                 Phone 919-486-1821
Fax: 919-254-6753                                   Fax: 919-543-0784

Supplier Coordinator                                Buyer Financial Coordinator:
Matt Clark                                          Jeannie Bond
Perficient Inc.                                     IBM Corporation
7600-B N. Capital of Texas Hywy, Suite 340          4205 South Miami Blvd
Austin, TX 78731                                    RTP, NC 27709
Phone: 512-531-6014                                 Phone: 919-254-7967
Fax: 512-531-6011                                   Fax: 919-254-2322

      10 INVOICING INSTRUCTIONS

      10.1 ELECTRONIC COMMERCE Unless previously submitted by Supplier, in order
to initiate electronic transfer of payments associated with this SOW, Supplier
will complete the form entitled "Authorization for Electronic Funds Transfer"
and fax the completed form to Accounts Payable at the number included on the
form.

      10.2 Supplier will invoice Buyer for the actual days/hours (as
appropriate) of Services provided under this SOW on a monthly basis.

      10.3 Supplier's invoices will include the dates and number of days/hours
worked during the invoice period and any reimbursable expenses, as well as the
information required in accordance with Section 2, "Required Documentation" of
Exhibit VII. The purchase order number to reference on Supplier invoices will be
provided. Buyer will pay Supplier 45 days after Buyer's Accounts Payable
receives an invoice that meets the above requirements.

      10.4 In addition, Supplier will fax copies of expense receipts and weekly
CARs to the Buyer's Financial Coordinator identified in this SOW.

      10.5 Work Authorizations shall be submitted to and accepted by the
Supplier electronically in the form as outlined in Exhibit IX.

      11 MODIFICATIONS TO AGREEMENT 4900CS0965

      The following provisions modify and/or supersede the specified portions of
Agreement 4900CS0965.

      11.1 Section 3.3 of Agreement 4900CS0965 is deleted for the purposes of
this SOW and replaced with the following: Buyer may terminate this SOW
immediately with Cause or without Cause on four months prior written notice.
Upon termination, in accordance with Buyer's written direction, Supplier will
immediately, (i) cease work or fulfill existing work authorizations on Buyer's
discretion; (ii) prepare and submit to buyer an itemization of all completed and
partially completed Deliverables and Services (iii) deliver to Buyer,
Deliverables satisfactorily completed up to the date of termination at the
agreed upon Prices in the relevant SOW; and (iv) deliver upon request any work
in progress. Buyer will compensate Supplier for the actual and reasonable
expenses incurred

                                  Page 5 of 7
<PAGE>

                                STATEMENT OF WORK

                                                          AGREEMENT # 4900CS0965
                                                                SOW # 4900OP0312
--------------------------------------------------------------------------------
by Supplier for work in progress up to and including the date of termination, as
outlined in Exhibit VII and make all Utilization Guarantee Payments as required
by Section 7.

      11.2 Section 3.2 of Agreement 4900CS0965 is deleted for the purposes of
this SOW and replaced with the following:

      Either party may terminate this Agreement, without any cancellation
charge, for a material breach of the Agreement by the other party, or if the
other party becomes insolvent or files or has filed against it a petition in
bankruptcy ("Cause"), to the extent permitted by law. Buyer may terminate this
agreement, without any cancellation charge, in the event of a Change of Control
of Supplier involving a party (or any of the other parties, if more than one)
who has a substantial portion of its business in the web application server
product and services market and is not engaged in business primarily as a
professional services/consulting firm or systems integrator. Such termination
will be effective at the end of a thirty (30) day written notice period if the
Cause remains uncured. Either party may terminate this Agreement without Cause
when there are no outstanding SOWs or WAs.

      12 RIGHT OF FIRST OFFER

      If (i) the Supplier has delivered to Buyer the notice required under
Section 4.6, and (ii) the other party (or any of the other parties, if more than
one) to the proposed Change of Control Transaction has a substantial portion of
its business in the web application server product and service market and is not
engaged in business primarily as a professional services/consulting firm or
systems integrator, and provided that Buyer has not reduced the pool of Supplier
Personnel by more than 1/3 during the term of this agreement, the Supplier shall
give the Buyer the first opportunity to enter into such Change of Control
Transaction with the Supplier (the "Right of First Offer") in the manner
specified in this Section 12.

      (i) The First Offer Notice shall specify the proposed price to be paid,
the proposed terms of payment, and all other material terms and conditions upon
which the Supplier proposes to enter into the Change of Control Transaction (the
"First Offer Terms").

      (ii) The First Offer Notice shall constitute an irrevocable offer to the
Buyer to enter into such Change of Control Transaction with the Supplier on the
First Offer Terms or on terms specified by the Buyer which include cash to the
same extent as the First Offer Terms and in other respects are economically
equivalent to the First Offer Terms (the "Buyer's Equivalent Terms"). Within 14
calendar days after the receipt of the First Offer Notice, the Buyer shall give
notice (the "Exercise Notice") to the Supplier that (i) the Buyer has elected to
exercise its Right of First Offer and set forth the terms of such acquisition or
(ii) the Buyer does not wish to exercise its Right of First Offer. If the Buyer
does not deliver an Exercise Notice to the Supplier within 14 calendar days
after the receipt of the First Offer Notice, the Buyer shall be deemed to have
delivered on the 14th calendar day an Exercise Notice stating that the Buyer
does not wish to exercise its Right of First Offer.

      (iii) If the Buyer exercises the Right of First Offer, then the Supplier
shall enter into such Change of Control Transaction with the Buyer on the First
Offer Terms or, if such terms are specified by the Buyer, the Buyer's Equivalent
Terms. The closing of such Change of Control Transaction shall take place on the
second business day after the Buyer and the Supplier shall have obtained or made
all consents, approvals, orders, licenses, permits and authorizations of, and
registrations, declarations and filings with, any governmental authority or any
other person or entity required to be obtained or made in connection with the
consummation of such Change of Control Transaction, or on such other date as
shall be mutually acceptable to the Buyer and Supplier.

      (iv) In the event of a dispute between the Buyer and the Supplier
concerning the economic equivalence of the Buyer's Equivalent Terms and the
First Offer Terms, the determination of the equivalence of such terms shall be
made by an independent nationally recognized investment banking firm selected by
the Buyer and consented to by the Supplier, which consent shall not be
unreasonably withheld. The Buyer and the Supplier shall cooperate fully in
assisting any such investment banking firm in making its determination. The
Buyer and Supplier shall each bear one-half of the cost of such investment
banking firm.

      (v) If the Buyer does not exercise the Right of First Offer with respect
to any Change of Control Transaction, the Supplier shall be entitled, within 90
calendar days following the expiration of the period for exercise of the Right
of First Offer, to consummate such Change of Control Transaction with any third
party upon terms and conditions no more favorable to such third party than the
First Offer Terms.

                                  Page 6 of 7
<PAGE>

                                STATEMENT OF WORK

                                                          AGREEMENT # 4900CS0965
                                                                SOW # 4900OP0312
--------------------------------------------------------------------------------
      For the purpose of Sections 4.6, 5.3, 11.2 and 12, a "Change of Control"
shall be deemed to have occurred if (A) there shall be consummated (a) any
consolidation or merger of Supplier in which Supplier is not the continuing or
surviving corporation, or pursuant to which shares of Supplier's common stock
would be converted into cash, securities or other property, other than a merger
of Supplier in which the holders of Supplier's common stock immediately prior to
the merger have substantially the same proportionate ownership of common stock
of the surviving corporation immediately after the merger, or (b) any sale,
lease, exchange, or other transfer (in one transaction or a series of related
transactions) of all or substantially all the assets of Supplier, or (B) the
stockholders of Supplier shall approve any plan or proposal for the liquidation
or dissolution of Supplier, or (C) any person (as such term is used in section
13(d) and 14(d)(2) of the Securities Exchange Act of 1934 (the "Exchange Act")
other than Supplier or any employee benefit plans sponsored by Supplier, shall
become the beneficial owner (within the meaning of Rule 13d-3 under the Exchange
Act) of securities of the company representing 25% or more of voting securities
having the voting power of the Supplier's then outstanding securities ordinarily
(and apart from rights accruing in special circumstances) having the right to
vote in the election of directors, as a result of a tender or exchange offer,
open market purchases, privately negotiated purchases, or otherwise, or (D) at
any time during a period of twelve consecutive months, individuals who at the
beginning of such period constituted the Board of Directors of Supplier shall
cease for any reason to constitute at least a majority thereof, unless the
election of, or the nomination for election by Supplier's stockholders of each
new director during such twelve-month period was approved by a vote of at least
two-thirds of the directors then still in office who were directors at the
beginning of such twelve-month period.

      Buyer and Supplier agree that the information contained in the First Offer
Terms and the Exercise Notice shall be considered Information as that term is
defined in the Agreement for Exchange of Confidential Information # 4900OP0257
between the Buyer and Supplier.

      12.1 In the event of any inconsistency between this SOW and Agreement
4900CS0965, this SOW shall control.

ACCEPTED AND AGREED TO:                  ACCEPTED AND AGREED TO:

IBM                                      Perficient Inc.

By: /s/ HENRY KEEGAN                     By: /s/ SAM J. FATIGATO
----------------------------------       ---------------------------------------
Buyer Signature          Date            Supplier Signature          Date

Buyer's Name

----------------------------------       ---------------------------------------
Printed Name                             Printed Name

IBM Customer Solutions and
General Procurement

----------------------------------       ---------------------------------------
Title & Organization                     Title & Organization

----------------------------------       ---------------------------------------
Buyer Address:                           Supplier Address:
3039 Cornwallis Road                      7600-B N. Capital of Texas Hywy
RTP, NC 27709                             Suite 340,
                                          Austin, TX  78731

                                  Page 7 of 7

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