Document:

VERTICA SOFTWARE, INC.

                             NOTE PURCHASE AGREEMENT

         THIS NOTE PURCHASE AGREEMENT ("Agreement") is made as of the 9th day of
April 1997 by and between VERTICA SOFTWARE,  INC. a California  corporation (the
"Company"), and Arthur A. Gingell, an individual (the "Purchaser").

         In  consideration  of the  mutual  promises  hereinafter  set forth the
parties hereby agree as follows:

SECTION 1. AMOUNT AND TERMS OF THE LOAN

         1.1 The Loan.  Subject  to the  terms of this  Agreement,  the  Company
agrees to sell and Purchaser agrees to loan to the Company, One Hundred Thousand
Dollars  ($100,000.00)  (the  "Loan  Amount")  pursuant  to two (2)  convertible
promissory  notes  (the  "First  Note"  and  "Second  Note",  collectively,  the
"Notes"), each in the form attached hereto as Exhibit A. Upon the closing of the
Company's Stock Financing (as defined below) the outstanding  principal  balance
and unpaid accrued interest of the Notes shall automatically convert into shares
of Company's  Securities  pursuant to the terms of Section 1.3. In the event the
Stock  Financing has not closed within one year from the date of this Agreement,
the  principal  balance  and  unpaid  accrued  interest  of the  Notes  shall be
automatically converted into shares of the Company's Series A Preferred Stock.

         1.2 Stock Financing. For purposes of this Agreement,  "Stock Financing"
shall mean the sale by the Company of shares of its capital stock ("Securities")
to investors  ("Investors") with aggregate cash proceeds to the Company equal to
or in excess of Three Hundred Thousand Dollars ($300,000).

         1.3 Conversion Upon Stock Financing.  Immediately  prior to or upon the
closing of a Stock Financing as defined in Section 1.2, the principal amount and
any accrued and unpaid  interest on the Notes shall  automatically  convert into
shares of the  Company's  Securities  purchased by the Investors at a conversion
price equal to the lower of (i) One Dollar and Sixty Cents ($1.60) per share, or
(ii)  eighty  percent  (80%)  of the  price  per  share  paid  by the  Investors
purchasing the Securities.

         1.4 Other  Conversion.  In the event the Stock Financing has not closed
within one year from the date of this  Agreement,  the principal  amount and any
accrued and unpaid interest on the Notes shall automatically convert into shares
of the  Company's  Series A Preferred  Stock at a conversion  price equal to One
Dollar and Sixty Cents ($1.60) per share.

SECTION 2. THE CLOSING

         2.1      Closings.

                  (a) First Closing. The closing of the purchase and sale of the
First Note (the

<PAGE>

"First  Closing")  shall be held on April 10,  1997,  at the  offices  of Cooley
Godward LLP, Five Palo Alto Square,  3000 El Camino Real, Palo Alto,  California
94306,  or at such other time as the Company and the Purchaser  shall agree (the
"First Closing Date").

                  (b) Second  Closing.  The closing of the  purchase and sale of
the Second Note (the "Second  Closing")  shall be held on April 11, 1997, at the
offices of Cooley Godward LLP, Five Palo Alto Square,  3000 El Camino Real, Palo
Alto,  California  94306, or at such other time as the Company and the Purchaser
shall agree (the "Second Closing Date").

                  2.2 Deliveries.

                  (a) At the First  Closing (i)  Purchaser  will  deliver to the
Company a check or wire transfer funds in the amount of Fifty  Thousand  Dollars
($50,000);  and (ii) the Company shall deliver to Purchaser a Note  representing
such Purchaser's Loan Amount.

                  (b) At the Second  Closing (i)  Purchaser  will deliver to the
Company a checkor wire transfer  funds in the amount of Fifty  Thousand  Dollars
($50,000);  and (ii) the Company shall deliver to Purchaser a Note  representing
such Purchaser's Loan Amount.

SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

         The Company hereby represents and warrants to Purchaser as follows:

         3.1  Corporate  Power.  The Company  will have at the Closing  Date all
requisite corporate power to execute and deliver this Agreement and to carry out
and perform its obligations under the terms of this Agreement.

         3.2 Authorization. All corporate action on the part of the Company, its
directors  and its  shareholders  necessary  for the  authorization,  execution,
delivery and performance of this Agreement by the Company and the performance of
the Company's obligations hereunder,  including the issuance and delivery of the
Notes has been taken or will be taken prior to the Closing.  This  Agreement and
the Notes when executed and delivered by the Company, shall constitute valid and
binding  obligations of the Company  enforceable in accordance with their terms,
subject to laws of general application relating to bankruptcy,  insolvency,  the
relief of debtors and, with respect to rights to  indemnity,  subject to federal
and  state  securities  laws.  The  Series A  Preferred  Stock  or other  equity
securities of the Company, when issued in compliance with the provisions of this
Agreement,  or the Notes,  will be validly issued,  fully paid and nonassessable
and free of any liens or encumbrances.

         3.3  Governmental  Consents.  All  consents,   approvals,   orders,  or
authorizations of, or registrations, qualifications, designations, declarations,
or filings with, any governmental authority, required on the part of the Company
in  connection  with the valid  execution  and delivery of this  Agreement,  the
offer,  sale or issuance of the Notes and the equity  securities  issuable  upon
conversion  of  the  Notes  or  the   consummation  of  any  other   transaction
contemplated  hereby  shall  have been  obtained  and will be  effective  at the
Closing, except for notices required or permitted to be filed with certain state
and federal  securities  commissions,

<PAGE>

which notices will be filed on a timely basis.

         3.4  Offering.   Assuming  the  accuracy  of  the  representations  and
warranties of the Purchasers  contained in Section 4 hereof,  the offer,  issue,
and  sale of the  Notes  are and  will  be  exempt  from  the  registration  and
prospectus delivery  requirements of the Securities Act of 1933, as amended (the
" 1933  Act"),  and have  been  registered  or  qualified  (or are  exempt  from
registration and qualification) under the registration, permit, or qualification
requirements of all applicable state securities laws.

SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS

         4.1 Purchase for Own Account. Purchaser represents that it is acquiring
the  Notes and the  equity  securities  issuable  upon  conversion  of the Notes
(collectively, the "Notes and Underlying Securities") solely for its own account
and  beneficial  interest  for  investment  and not  for  sale or with a view to
distribution of the Notes and Underlying  Securities or any part thereof, has no
present  intention of selling (in connection  with a distribution or otherwise),
granting any participation in, or otherwise  distributing the same, and does not
presently have reason to anticipate a change in such intention.

         4.2 Information and Sophistication.  Purchaser acknowledges that it has
received all the  information  it has  requested  from the Company and considers
necessary or appropriate  for deciding  whether to acquire the Notes.  Purchaser
represents  that it has had an opportunity to ask questions and receive  answers
from the Company regarding the terms and conditions of the offering of the Notes
and to obtain any additional information necessary to verify the accuracy of the
information given the Purchaser.  Purchaser further  represents that it has such
knowledge and experience in financial and business matters that it is capable of
evaluating the merits and risk of this investment.

         4.3  Ability  to  Bear  Economic  Risk.  Purchaser   acknowledges  that
investment in the Notes involves a high degree of risk,  and represents  that it
is able,  without  materially  impairing  its financial  condition,  to hold the
Securities for an indefinite period of time and to suffer a complete loss of its
investment.

         4.4 Further Limitations on Disposition. Without in any way limiting the
representations  set  forth  above,  Purchaser  further  agrees  not to make any
disposition of all or any portion of the Securities unless and until:

                  (a) There is then in effect a Registration Statement under the
1933 Act covering  such proposed  disposition  and such  disposition  is made in
accordance with such Registration Statement; or

                  (b) (i) The  Purchaser  shall have notified the Company of the
proposed  disposition  and shall  have  furnished  the  Company  with a detailed
statement of the circumstances surrounding the proposed disposition, and (ii) if
reasonably  requested by the Company,  such  Purchaser  shall have furnished the
Company with an opinion of counsel, reasonably satisfactory to the Company, that
such disposition will not require registration under the 1933 Act.

<PAGE>

         4.5 Experience.  Purchaser is an "accredited  investor" as such term is
defined in Rule 501 under the Securities Act.

SECTION 5. MISCELLANEOUS

         5.1 Binding Agreement. The terms and conditions of this Agreement shall
inure to. the  benefit  of and be binding  upon the  respective  successors  and
assigns of the  parties.  Nothing in this  Agreement,  express  or  implied,  is
intended to confer upon any third party any rights,  remedies,  obligations,  or
liabilities under or by reason of this Agreement,  except as expressly  provided
in this Agreement.

         5.2  Governing  Law Venue.  This  Agreement  shall be  governed  by and
construed  under the laws of the State of  California  as applied to  agreements
among California  residents,  made and to be performed entirely within the State
of  California.  Each of Company and Purchaser  hereby  submits to the exclusive
jurisdiction  of the State and  Federal  courts  located  in the County of Santa
Clara, State of California.

         5.3  Counterparts.  This  Agreement  may be  executed  in  two or  more
counterparts,  each of  which  shall be  deemed  an  original,  but all of which
together shall constitute one and the same instrument.

         5.4  Titles  and  Subtitles.  The  titles  and  subtitles  used in this
Agreement  are  used  for  convenience  only  and  are not to be  considered  in
construing or interpreting this Agreement.

         5.5 Notices.  All notices  required or permitted  hereunder shall be in
writing and shall be deemed effectively given: (i) upon personal delivery to the
party to be notified, (ii) when sent by confirmed telex or facsimile, (iii) five
(5) days after having been sent by registered or certified mail,  return receipt
requested,  postage prepaid, or (iv) one (1) day after deposit with a nationally
recognized  overnight  courier,  specifying  next  day  delivery,  with  written
verification of receipt.

         5.6 Modification; Waiver. No modification or waiver of any provision of
this Agreement or consent to departure  therefrom  shall be effective  unless in
writing and approved by the Company and the Purchaser.

         5.7 Entire Agreement. This Agreement and the Exhibits hereto constitute
the full and entire understanding and agreement between the par-ties with regard
to the subjects hereof and no party shall be liable or bound to any other in any
manner by any  representations,  warranties,  covenants and agreements except as
specifically set forth herein.

<PAGE>

         IN WITNESS  WHEREOF,  the parties  have  executed  this Notes  Purchase
Agreement as of the date set forth in the first paragraph hereof.

                                      COMPANY:
                                      VERTICA SOFTWARE, INC.
                                      5801 Christie Avenue, Suite 240
                                      Emeryville, CA 94608

                                      By:
                                         ---------------------------------------
                                           Hans Nehme
                                           President and Chief Executive Officer

                                      PURCHASER:
                                      Arthur A. Gingell
                                      157 Camino Arroyo North
                                      Palm Desert, CA 92260

                                      /s/ Arthur A. Gingell
                                      ------------------------------------------
                                              Arthur A. Gingell

         21275299
         040997

<PAGE>

         IN WITNESS  WHEREOF,  the parties  have  executed  this Notes  Purchase
Agreement as of the date set forth in the first paragraph hereof.

                                      COMPANY:
                                      VERTICA SOFTWARE, INC.
                                      5801 Christie Avenue, Suite 240
                                      Emeryville, CA 94608

                                      By: /s/ Hans Nehme
                                         ---------------------------------------
                                           Hans Nehme
                                           President and Chief Executive Officer

                                      PURCHASER:
                                      Arthur A. Gingell
                                      157 Camino Arroyo North
                                      Palm Desert, CA 92260

                                          --------------------------------------
                                            Arthur A. Gingell

21275299
040997STOCK PURCHASE AND EXCHANGE AGREEMENT

         THIS STOCK PURCHASE AND EXCHANGE AGREEMENT  (hereinafter referred to as
the  "Agreement") is made and entered into this 29th day of September,  1998, by
and  among   Perfection   Development   Corporation,   a  Colorado   corporation
(hereinafter referred to as the "Company"),  and Scott M. Thornock and C. Edward
Venerable  (hereinafter  referred  to,  individually,   as  a  "Guarantor"  and,
collectively, as the "Guarantors"), on the one hand, and Vertica Software, Inc.,
a California corporation (hereinafter referred to as "Vertica"),  and Hans Nehme
(hereinafter referred to as the "Purchaser"), on the other hand.

                                    RECITALS:

         WHEREAS,  the  Company  desires  to  issue,  sell  and  deliver  to the
Purchaser,  and the Purchaser desires to purchase,  acquire and receive from the
Company,  an aggregate of 9,200,000  authorized and unissued shares (hereinafter
referred  to as the  "Shares")  of  common  stock,  $.0001  par  value per share
(hereinafter  referred to as the "Perfection  Common Stock"),  of the Company in
consideration  of the exchange  therefor of all 4,930,000 issued and outstanding
shares of common stock, no par value per share  (hereinafter  referred to as the
"Vertica Common  Shares"),  of Vertica which are owned by the Purchaser,  on the
terms and subject to the conditions set forth herein;

         WHEREAS,  the Guarantors,  who own an aggregate of 1,040,000  shares of
Perfection Common Stock, desire to sell, assign, transfer, convey and deliver to
the Purchaser,  and the Purchaser  desire to purchase,  acquire and receive from
the Guarantors,  a total of 480,000 restricted shares of Perfection Common Stock
which are owned by the  Guarantors,  in  consideration  of the sum of $25,000 in
cash paid therefor by the Purchaser to the Guarantors,  on the terms and subject
to the conditions set forth herein;

         WHEREAS, the Purchaser desires to pay finder's fees in the total amount
of  $50,000  to  Summit  Financial  Relations,  Inc.,  and  Columbine  Financial
Solutions,  Inc.  (hereinafter  referred to,  individually,  as a "Finder"  and,
collectively, as the "Finders") in connection with the transactions contemplated
by this Agreement;

         WHEREAS,  the Guarantors,  who own an aggregate of 1,040,000  shares of
Perfection  Common  Stock,  constituting  approximately  80% of the  issued  and
outstanding  shares of  Perfection  Common Stock as of the date hereof,  and who
constitute  both of the current  officers and  directors of the Company,  desire
that the transactions contemplated hereby be consummated; and

         WHEREAS,  the parties  hereto  intend that the issuance and sale of the
Shares of  Perfection  Common  Stock in exchange  for all of the Vertica  Common
Shares  shall  qualify as a "tax-free"  reorganization  as  contemplated  by the
provisions  of Section  368(a)(1)(B)  of the Internal  Revenue Code of 1986,  as
amended.

         NOW,  THEREFORE,  in  consideration  of the foregoing  premises and the
mutual covenants,  agreements,  representations and warranties contained herein,
the parties hereto agree as follows:

                                      -1-
<PAGE>

                                    ARTICLE 1
                   ISSUANCE AND/OR SALE AND PURCHASE OF SHARES

         1.1 Issuance and Sale of Shares of  Perfection  Common Stock by Company
to Purchaser in Exchange for Vertica Common Shares.  At the Closing,  as defined
and to be held in accordance with the provisions of Article 2 below, the Company
agrees to issue,  sell and  deliver a total of  9,200,000  Shares of  Perfection
Common Stock to the Purchaser and the Purchaser agrees to purchase,  acquire and
receive  said  aggregate  number of Shares of  Perfection  Common Stock from the
Company.  In consideration for the issuance and sale of said 9,200,000 Shares of
Perfection  Common Stock to the  Purchaser  pursuant to the  provisions  of this
Agreement,  and as payment in full of the purchase  price for the said Shares of
Perfection Common Stock to be issued and sold to, and purchased and acquired by,
him pursuant to the provisions of this  Agreement,  at the Closing the Purchaser
shall  sell,  assign,  transfer,  convey and  deliver to the  Company  the stock
certificate,  duly executed,  endorsed and/or  authenticated for transfer to the
Company,  evidencing  4,930,000  Vertica  Common  Shares  owned  of  record  and
beneficially by him.

         1.2  Sale of  Shares  of  Perfection  Common  Stock  by  Guarantors  to
Purchaser for $25,000 in Cash. At the Closing, the Guarantors, severally and not
jointly, agree to sell, assign, transfer,  convey and deliver a total of 480,000
restricted shares of Perfection Common Stock owned of record and beneficially by
them to the Purchaser and the Purchaser agrees to purchase,  acquire and receive
said aggregate number of restricted  shares of Perfection  Common Stock from the
Guarantors.  In consideration for the sale, assignment,  transfer and conveyance
of said 480,000 restricted shares of Perfection Common Stock owned of record and
beneficially  by the  Guarantors to the Purchaser  pursuant to the provisions of
this  Agreement,  and as  payment  in full of the  purchase  price  for the said
restricted shares of Perfection Common Stock owned of record and beneficially by
the Guarantors to be sold, assigned,  transferred and conveyed to, and purchased
and acquired by, the Purchaser pursuant to the provisions of this Agreement,  at
the  Closing  the  Purchaser  shall pay the total sum of  $25,000 in cash to the
Guarantors.

                                    ARTICLE 2
                                     CLOSING

         The  consummation  of  the  issuance  and  sale  to  and  purchase  and
acquisition by the Purchaser of 9,200,000 Shares of Perfection  Common Stock and
the sale, assignment, transfer and conveyance to and purchase and acquisition by
the Purchaser of 480,000  restricted  shares of Perfection Common Stock owned of
record  and  beneficially  by the  Guarantors  (hereinafter  referred  to as the
"Closing") shall occur at the offices of Cudd & Associates, 1120 Lincoln Street,
Suite #1310,  Denver,  Colorado 80203, at 2:00 p.m.,  Mountain Daylight Time, on
October 2, 1998, or at such other place and/or on such other date not later than
October 30, 1998, as the parties may agree upon in writing (hereinafter referred
to as the "Closing Date").  If the Closing fails to occur by October 2, 1998, or
by such later date to which the Closing may be extended as provided hereinabove,
then this Agreement shall automatically  terminate,  all parties shall pay their
own expenses incurred in connection  herewith and no party hereto shall have any
further obligations hereunder; provided, however, that no such termination shall
constitute  a waiver by any party or  parties  which is not in default of any of
his, its or their respective representations, warranties or covenants herein, of
any rights or  remedies  he, it or they might have at law if any other  party or
parties are in default of any of his, its or their  respective  representations,
warranties or covenants under this Agreement.

         At or prior to the Closing, as conditions thereto,

         (a) The  Company  shall  deliver,  or  cause  to be  delivered,  to the
Purchaser:

                                      -2-
<PAGE>

                  (i) A newly-issued  stock certificate  representing  9,200,000
Shares of Perfection Common Stock which are being purchased and acquired for the
account of the Purchaser,  in form and substance reasonably  satisfactory to the
Purchaser and his counsel.

                  (ii)  The  certified  resolutions  of the  Company's  Board of
Directors specified in Section 7.3 (a) below.

                  (iii)  The  certificate  of the  Company  and  the  Guarantors
specified in Section 7.3 (b) and (c) below.

                  (iv) The opinion letter of the Company's  counsel specified in
Section 7.3 (d) below substantially in the form attached hereto as Exhibit B and
incorporated herein by this reference.

                  (v) The letters of resignation of the current directors of the
Company specified in Section 7.3 (e) below.

         (b) The Purchaser shall deliver to the Company:

                  (i) The  stock  certificate(s)  evidencing  4,930,000  Vertica
Common Shares owned of record and  beneficially by the Purchaser which are being
sold, assigned, transferred and conveyed to the Company, duly executed, endorsed
and/or authenticated for transfer to the Company.

                  (ii)  The   certificate(s)   of  Vertica  and  the  Purchasers
specified in Section 7.4 (a) and (b) below.

                  (iii) The opinion letter of counsel to the Purchaser specified
in Section 7.4 (c) below  substantially in the form attached hereto as Exhibit C
and incorporated herein by this reference.

         (c) The  Purchaser  shall  deliver,  or cause to be  delivered,  to the
Guarantors  a cashier's  check in the amount of $75,000  payable to the order of
Patricia Cudd, Attorney at Law, COLTAF Trust Account.

         (d) The  Guarantors  shall  deliver,  or cause to be delivered,  to the
Purchaser  stock  certificates  evidencing  such number of restricted  shares of
Perfection  Common Stock owned of record and  beneficially  by each Guarantor as
set forth  opposite  his  respective  name on  Exhibit  D which are being  sold,
assigned,  transferred  and conveyed to the Purchaser,  duly executed,  endorsed
and/or authenticated for transfer to the Purchaser.

                                    ARTICLE 3
        REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE GUARANTORS

         The Company and the individual  Guarantors hereby jointly and severally
represent  and  warrant  to  Vertica  and the  Purchaser  as  follows  (it being
acknowledged  that Vertica and the Purchaser are entering into this Agreement in
material reliance upon each of the following representations and warranties, and
that the truth and accuracy of each of which  constitutes a condition  precedent
to the obligations of Vertica and the Purchaser hereunder):

                                      -3-
<PAGE>

         3.1 Organization and Corporate Power. The Company is a corporation duly
organized,  validly existing and in good standing under the laws of the State of
Colorado, and is duly qualified and in good standing to do business as a foreign
corporation in each  jurisdiction  in which such  qualification  is required and
where the failure to be so qualified would have a materially adverse effect upon
the Company.  The Company has all  requisite  corporate  power and  authority to
conduct its business as now being  conducted  and to own the  personal  property
which it now owns. The Articles of Incorporation  of the Company,  as amended to
date,  certified by the  Secretary  of State of Colorado,  and the Bylaws of the
Company, certified by the President and the Secretary of the Company, which have
been  delivered to the  Purchaser  prior to the execution  hereof,  are true and
complete copies thereof as in effect as of the date of this Agreement.

         3.2 Authorization.

                  (a) The Company has full power,  legal  capacity and authority
to enter  into  this  Agreement  and all  attendant  documents  and  instruments
necessary to consummate the transactions herein contemplated; to issue, sell and
deliver the Shares of Perfection  Common Stock to the Purchaser;  and to perform
all of the obligations to be performed by the Company hereunder.  This Agreement
and all other agreements, documents and instruments to be executed in connection
herewith  by the  Company  have been  effectively  authorized  by all  necessary
action, corporate or otherwise, on the part of the Company, which authorizations
remain in full force and effect and have been duly executed and delivered by the
Company and/or each of the Guarantors, and no other corporate proceedings on the
part of the Company are required to authorize the execution and delivery of this
Agreement, such other agreements, documents and instruments and the transactions
contemplated  hereby.  This Agreement and such other  agreements,  documents and
instruments  have been duly executed and delivered by the Company and/or each of
the  Guarantors;  constitute  the legal,  valid and  binding  obligation  of the
Company and each of the  Guarantors;  and are  enforceable  with  respect to the
Company and each of the Guarantors in accordance  with their  respective  terms,
except  as  enforcement  thereof  may  be  limited  by  bankruptcy,  insolvency,
reorganization,  priority  or  other  laws or  court  decisions  relating  to or
affecting  generally the enforcement of creditors' rights or affecting generally
the  availability of equitable  remedies.  Neither the execution and delivery of
this  Agreement,  the  consummation  by the  Company of any of the  transactions
contemplated hereby nor the compliance by the Company with any of the provisions
hereof will (i) conflict with or result in a breach of,  violation of or default
under any of the terms,  conditions or provisions of any note,  bond,  mortgage,
indenture,  license,  lease,  credit  agreement  or other  agreement,  document,
instrument or obligation  (including,  without limitation,  any of the Company's
charter  documents)  to which the  Company is a party or by which the Company or
any of the assets or  properties of the Company may be bound or (ii) violate any
judgment,  order, injunction,  decree, statute, rule or regulation applicable to
the  Company  or any of the assets or  properties  of the  Company.  To the best
knowledge  of the  Company  and the  Guarantors,  no  authorization,  consent or
approval of any public body or authority is necessary  for the  consummation  by
the Company of the transactions contemplated by this Agreement.

         (b) Each of the Guarantors has full power, legal capacity and authority
to enter  into  this  Agreement  and all  attendant  documents  and  instruments
necessary to consummate the transactions herein  contemplated;  to sell, assign,
transfer,  convey and deliver a total of 480,000 restricted shares of Perfection
Common Stock owned of record and  beneficially by them to the Purchaser;  and to
perform  all  of  the  obligations  to  be  performed  by  them  hereunder.  All
agreements,  documents and instruments to be executed in connection  herewith by
the  Guarantors  have been duly executed and delivered by the  Guarantors.  This
Agreement  has been  duly  executed  and  delivered  by each of the  Guarantors,
constitutes  the legal,  valid and binding  obligation of each of the Guarantors
and is enforceable with respect to each of the Guarantors in accordance with its
terms,  except as enforcement  hereof may be limited by bankruptcy,

                                      -4-
<PAGE>

insolvency,  reorganization,  priority or other laws or court decisions relating
to or affecting  generally the  enforcement  of  creditors'  rights or affecting
generally  the  availability  of equitable  remedies.  Neither the execution and
delivery of this Agreement nor the  consummation by the Guarantors of any of the
transactions  contemplated  hereby,  or compliance by the Guarantors with any of
the  provisions  hereof,  will (i)  conflict  with or  result  in a  breach  of,
violation of or default under any of the terms,  conditions or provisions of any
note,  bond,  mortgage,  indenture,  license,  lease,  credit agreement or other
agreement,  document,  instrument or obligation (including,  without limitation,
any of the Company's  charter  documents) to which either of the  Guarantors are
parties or by which either of the  Guarantors or any of the assets or properties
of the Guarantors may be bound or (ii) violate any judgment,  order, injunction,
decree,  statute,  rule or regulation  applicable to either of the Guarantors or
any of the  assets  or  properties  of  either  of the  Guarantors.  To the best
knowledge of the Guarantors, no authorization, consent or approval of any public
body or authority is necessary  for the  consummation  by the  Guarantors of the
transactions contemplated by this Agreement.

         3.3  Ownership of the Company.  The  Guarantors  together own 1,040,000
shares  of  Perfection  Common  Stock,   constituting  80%  of  the  issued  and
outstanding  shares of capital  stock of the Company,  free and clear of (i) any
lien, charge, mortgage,  pledge, conditional sale agreement or other encumbrance
of any kind or nature  whatsoever and (ii) any claim as to ownership  thereof or
any rights,  powers or interest  therein by any third  party,  whether  legal or
beneficial, and whether based on contract, proxy or other document or otherwise.

         3.4  Capitalization.

         (a) The authorized  capital stock of the Company consists of 30,000,000
shares of common  stock,  $.0001  par  value  per  share  (defined  above as the
"Perfection  Common Stock"),  and 3,000,000 shares of preferred stock, $.001 par
value per share (hereinafter  referred to as the "Perfection  Preferred Stock").
At the date hereof, there are 1,300,000 shares of Perfection Common Stock issued
and outstanding, with no shares of Perfection Common Stock held in the Company's
treasury and no shares of Perfection  Preferred Stock outstanding or held in the
Company's  treasury.  All of the outstanding  shares of Perfection  Common Stock
have  been  duly   authorized   and  validly   issued  and  are  fully-paid  and
nonassessable.

         (b) There are no warrants,  options, calls, commitments or other rights
to  subscribe  for or to purchase  from the  Company  any  capital  stock of the
Company or any securities  convertible  into or  exchangeable  for any shares of
capital  stock the Company,  or any other  securities  or agreement  pursuant to
which the Company is or may become  obligated to issue any shares of its capital
stock, nor is there  outstanding any commitment,  obligation or agreement on the
part of the  Company  to  repurchase,  redeem or  otherwise  acquire  any of the
outstanding shares of Perfection Common Stock.

         (c) There  currently are no rights,  agreements or  commitments  of any
character  obligating the Company,  contingently  or otherwise,  to register any
shares of its capital  stock under any  applicable  Federal or state  securities
laws.

         3.4  Financial  Statements.  Attached  hereto as Exhibit E are true and
complete copies of the audited financial statements of the Company as of October
31,  1997,  including  the Balance  Sheet as of October  31,  1997  (hereinafter
referred  to as the  "Perfection  Balance  Sheet"),  the related  Statements  of
Operations,  Shareholders'  Equity and Cash Flows for the period  from April 18,
1997  (inception)   through  October  31,  1997,  and  the  related  Summary  of
Significant Accounting Policies and Notes to Financial Statements, reported upon
by Cordovano and Harvey, P.C. (formerly Cordovano and Company,  P.C.), certified
public  accountants.  Such financial  statements (and the notes related thereto)
are herein  sometimes  collectively  referred  to as the  "Perfection  Financial
Statements." The Perfection  Financial Statements (i) are derived

                                      -5-
<PAGE>

from the books and records of the  Company,  which  books and records  have been
consistently  maintained in a manner which reflects,  and such books and records
do fairly and  accurately  reflect,  the assets and  liabilities of the Company,
(ii) fairly and accurately present the financial condition of the Company on the
respective  dates of such  statements  and the results of its operations for the
periods  indicated,  except as may be disclosed in the notes thereto,  and (iii)
have been  prepared  in all  material  respects  in  accordance  with  generally
accepted  accounting  principles  consistently  applied  throughout  the periods
involved (except as otherwise disclosed in the notes thereto).

         3.5  Subsidiaries.  The Company has no subsidiaries and no investments,
directly or indirectly,  or other financial interest in any other corporation or
business organization, joint venture or partnership of any kind whatsoever.

         3.6  Absence of  Undisclosed  Liabilities.  Except as and to the extent
reflected or reserved  against in the Perfection  Balance Sheet, the Company has
no liability(s) or obligation(s)  (whether accrued, to become due, contingent or
otherwise)  which  individually  or in the  aggregate  could  have a  materially
adverse  effect on its business,  assets,  properties,  condition  (financial or
otherwise) or prospects.

         3.7 Absence of Certain  Developments.  Except as described on Exhibit F
attached hereto and incorporated herein by this reference, since the date of the
Perfection Balance Sheet, there has been (i) no materially adverse change in the
condition (financial or otherwise) of the Company or in the assets, liabilities,
properties,   business,   operations  or  prospects  of  the  Company;  (ii)  no
declaration, setting aside or payment of any dividend or other distribution with
respect  to the  Perfection  Common  Stock  or  redemption,  purchase  or  other
acquisition   of  any   Perfection   Common  Stock  or  any  split-up  or  other
recapitalization   relative  to  any  Perfection  Common  Stock  or  any  action
authorizing or obligating the Company to do any of the foregoing; (iii) no loss,
destruction or damage to any material property or asset of the Company,  whether
or not insured; (iv) no acquisition or disposition of assets (or any contract or
arrangement  therefor),  or any other  transaction by the Company otherwise than
for fair value and in the  ordinary  course of  business;  (v) no  discharge  or
satisfaction  by the  Company  of any  lien or  encumbrance  or  payment  of any
obligation or liability  (absolute or contingent) other than current liabilities
shown on the Perfection Balance Sheet, or current liabilities incurred since the
date thereof in the ordinary  course of business;  (vi) no sale,  assignment  or
transfer  by the  Company of any of the  tangible  or  intangible  assets of the
Company,  cancellation  by the  Company  of any  debts,  claims or  obligations,
mortgage,  pledge or  satisfaction  by the  Company  of any  assets to any lien,
charge,  security  interest or other encumbrance or waiver by the Company of any
rights of value  which,  in any such case,  is material  to the  business of the
Company (whether or not in the ordinary course of business); (vii) no payment of
any bonus to or change in the compensation of any director,  officer or employee
of the  Company,  whether  directly  or by means  of any  bonus,  pension  plan,
contract  or  commitment;  (viii) no  write-off  or  material  reduction  in the
carrying  value of any asset which is material to the  business of the  Company;
(ix) no disposition  or lapse of rights as to any  intangible  property which is
material  to the  business  of the  Company;  (x)  except  for  ordinary  travel
advances, no loans or extensions of credit to shareholders,  officers, directors
or employees of the Company; (xi) no entry into any commitment or transaction by
the  Company   (including,   without   limitation,   any  borrowing  or  capital
expenditure)  involving an amount in excess of  $1,000.00;  (xii) no issuance of
any capital stock, or of any other security  convertible into any of the capital
stock, of the Company; and (xiii) no agreement to do any of the things described
in this Section 3.7.

         3.8 Tangible Personal Property. Exhibit F sets forth a complete list of
all items of  tangible  personal  property  owned and used by the Company in the
current  conduct  of its  business  where  the  original  cost was in  excess of
$1,000.00.  The Company has and at the Closing  will have,  good and  marketable
title to, and be in possession of, all such items of personal  property

                                      -6-
<PAGE>

owned by the Company, free and clear of all title defects,  mortgages,  pledges,
security  interests,   conditional  sales  agreements,  liens,  restrictions  or
encumbrances whatsoever.

         3.9 Tax Matters.  The Company has, since its inception,  duly filed all
Federal,  state,  county and local tax returns required to have been filed by it
in those jurisdictions where the nature or conduct of its business requires such
filing  and where the  failure  to so file  would be  materially  adverse to the
Company.  Copies of all such tax returns have been  furnished  to the  Purchaser
prior to the  execution  hereof.  All  Federal,  state,  county and local taxes,
including  but not  limited to those  taxes due with  respect  to the  Company's
property,  income,  gross  receipts,  excise,  occupation,   franchise,  permit,
licenses,  sales, payroll and inventory due and payable as of the Closing by the
Company have been paid. No amount is required to be reflected in the  Perfection
Balance  Sheet as a  liability  or reserve  for taxes  which are due but not yet
payable  and,  to the best  knowledge  of the Company  and the  Guarantors,  the
Company has no accrued and unpaid taxes of the types referred to hereinabove.

         3.10 Contracts and Commitments. The Company has no contract, agreement,
obligation or commitment,  written or verbal, express or implied, which involves
a commitment  or liability in excess of $1,000.00 or for a term of more than six
months,  and no union  contracts,  employee or consulting  contracts,  financing
agreements, debtor or creditor arrangements, licenses, franchise, manufacturing,
distributorship  or  dealership  agreements,  leases or  bonus,  health or stock
option plans,  except as described on Exhibit F. True and complete copies of all
such contracts and other agreements listed on Exhibit F have been made available
to the Purchaser prior to the execution hereof. The Guarantors have no knowledge
of any circumstances which would affect the validity or enforceability of any of
such contracts and other agreements in accordance with their  respective  terms.
The  Company  has  performed  and  complied in all  material  respects  with all
obligations  required to be performed by it to date under, and is not in default
(without  giving  effect to any required  notice or grace period)  under,  or in
breach of, the terms,  conditions  or  provisions  of any of such  contracts and
other  agreements.  The  validity  and  enforceability  of any contract or other
agreement  described herein shall not in any manner be affected by the execution
and delivery of this Agreement without any further action.

         3.11  Patents,  Trade  Secrets and Customer  Lists.  The Company has no
patents,  applications  for patents,  trademarks,  applications  for trademarks,
trade names,  licenses or service marks  relating to the business of the Company
except as set forth on Exhibit F hereto, nor does any present or former officer,
director  or  employee  of the  Company  own any patent  rights  relating to any
products  manufactured,  rented or sold by the  Company.  Except as disclosed on
Exhibit F, the Company has the unrestricted  right to use, free and clear of any
claims or rights of others, all trade secrets,  customer lists and manufacturing
and secret  processes  reasonably  necessary to the manufacture and marketing of
all products  made or proposed to be made by the Company,  and the continued use
thereof after the Closing by the Company will not conflict  with,  infringe upon
or otherwise violate any rights of others. Except as set forth on Exhibit F, the
Company has not used and is not making use of any  confidential  information  or
trade secrets of any present or past employee of the Company.

         3.12 No Pending Material Litigation or Proceedings. Except as disclosed
on Exhibit F, there are no actions,  suits or  proceedings  pending,  threatened
against or affecting the Company (including actions,  suits or proceedings where
liabilities  may be  adequately  covered  by  insurance)  at law or in equity or
before or by any Federal,  state,  municipal or other  governmental  department,
commission,  court,  board,  bureau,  agency  or  instrumentality,  domestic  or
foreign,  or  affecting  any of the  officers  or  directors  of the  Company in
connection with the business,  operations or affairs of the Company, which might
result in any adverse  change in the business,  properties or assets,  or in the
condition  (financial or  otherwise) of the Company,  or which might prevent the
sale of the Perfection Common Stock pursuant to this Agreement.  The Company has
not,  since its inception on April 18, 1997,  been  threatened  with any action,
suit, proceeding or

                                      -7-
<PAGE>

claim (including actions, suits, proceedings or claims where its liabilities may
be adequately covered by insurance) for personal injuries allegedly attributable
to products  sold or services  performed  by the Company  asserting a particular
defect  or  hazardous  property  in any of the  Company's  respective  products,
services or business  practices or methods,  nor has the Company been a party to
or threatened with proceedings brought by or before any Federal or state agency;
and the Company has no knowledge of any defect or hazardous  property claimed or
actual in any such product,  service or business practice or method. The Company
is not  subject to any  voluntary  or  involuntary  proceeding  under the United
States  Bankruptcy  Code  and has not  made an  assignment  for the  benefit  of
creditors.

         3.13  Arrangements  with  Personnel.  Except as set forth on  Exhibit F
hereto, no stockholder,  director, officer or employee of the Company is a party
to any transaction with the Company,  including without limitation any contract,
loan or other agreement or arrangement  providing for the furnishing of services
by, the rental of real or personal  property  from or to or otherwise  requiring
loans or payments to, any such stockholder, director, officer or employee, or to
any  member  of the  family  of any of  the  foregoing,  or to any  corporation,
partnership,  trust or other entity in which any stockholder,  director, officer
or  employee  of the  Company  or any  member of the family of any of them has a
substantial interest or is an officer,  director,  trustee, partner or employee.
There is set forth on Exhibit F a list  showing  (i) the name,  title,  date and
amount of last  compensation  increase,  and aggregate  compensation,  including
amounts  paid  or  accrued  pursuant  to any  bonus,  pension,  profit  sharing,
commission, deferred compensation or other plans or arrangements in effect as of
the date of this Agreement,  of each officer,  employee,  agent or contractor of
the Company who received salary and/or other  compensation from the Company,  as
well as any employment  agreements relating to any such persons; (ii) all powers
of  attorney  from the  Company to any person or entity;  (iii) the name of each
person or entity  authorized to borrow money or incur or guarantee  indebtedness
on  behalf  of the  Company;  (iv) all  safes,  vaults  and safe  deposit  boxes
maintained  by or on  behalf  of the  Company  and  the  names  of  all  persons
authorized to have access thereto;  and (v) all bank and savings accounts of the
Company and the names of all persons who are authorized signatories with respect
to such  accounts,  the capacities in which they are authorized and the terms of
their authorizations.

         3.14  Labor  Relations.  The  Company  has  no  obligations  under  any
collective  bargaining agreement or other contract with a labor union, under any
employment   contract  or   consulting   agreement  or  under  any   executive's
compensation  plan,  agreement  or  arrangement,  nor  is  any  union  or  labor
organization  presently  seeking the right to enter into  collective  bargaining
with the  Company.  The Company  has  furnished  to the  Purchaser a copy of all
written personnel policies,  including without limitation  vacation,  severance,
bonus, pension, profit sharing and commissions policies.

         3.15 Compliance with Laws. To the best knowledge of the Company and the
Guarantors,   the  Company   holds  all   licenses,   franchises,   permits  and
authorizations  necessary  for the lawful  conduct of its  business as presently
conducted,  and has complied with all  applicable  statutes,  laws,  ordinances,
rules and  regulations of all  governmental  bodies,  agencies and  subdivisions
having,  asserting or claiming jurisdiction over it, with respect to any part of
the conduct of its business and corporate affairs.

         3.16 Relationships with Customers and Suppliers. No present customer or
substantial  supplier to the Company has  indicated an intention to terminate or
materially  and  adversely  alter its existing  business  relationship  with the
Company  and the  Company  has no  reason  to  believe  that any of its  present
customers or substantial suppliers intends to do so.

         3.17  Brokerage.  Neither  the  Company  nor the  Guarantors  have  any
obligation to any person or entity for brokerage  commissions,  finders' fees or
similar  compensation in connection with the  transactions  contemplated by this
Agreement, and the Guarantors,  jointly and severally,

                                      -8-
<PAGE>

shall  indemnify  and hold the Purchaser  and the Company  harmless  against any
liability or expenses  arising out of any such claim asserted against either the
Purchaser or the Company by any party except Summit Financial  Relations,  Inc.,
and Columbine  Financial  Solutions,  Inc., to which companies the Purchaser has
agreed to pay  finders'  fees  aggregating  the sum of  $50,000 as  provided  in
Section 4.19 below.

         3.18 Investment  Representation.  The Company,  through the Guarantors,
has  the  knowledge  and  experience  in  business  and  financial   matters  to
meaningfully  evaluate  the  merits  and risks of the  issuance  and sale of the
Shares of Perfection  Common Stock in exchange and consideration for the Vertica
Common Shares as contemplated  hereby.  The Company shall conduct an independent
review of the business, assets, properties, books and records of Vertica for the
purpose of satisfying  itself as to the truth,  accuracy and completeness of the
representations  and warranties made by the Purchaser.  The Company  understands
and  acknowledges  that the Vertica Common Shares were originally  issued to the
Purchaser and will be sold and  transferred  to the Company in the  transactions
contemplated hereby without registration or qualification or other filings being
made under the U.S.  Securities Act of 1933, as amended, or any applicable state
securities or "Blue Sky" law, in reliance upon  specific  exemptions  therefrom,
and in furtherance thereof the Company represents that the Vertica Common Shares
will be taken and received by the Company for its account for  investment,  with
no present  intention of a distribution  or disposition  thereof to others.  The
Company further  acknowledges and agrees that the certificates  representing the
Vertica  Common  Shares  transferred  to  the  Company  shall  be  subject  to a
stop-transfer  order and shall bear a restrictive  legend,  in substantially the
following form:

         "THE SECURITIES  REPRESENTED BY THIS  CERTIFICATE  WERE ISSUED
         WITHOUT  REGISTRATION  UNDER THE  SECURITIES  ACT OF 1933,  AS
         AMENDED (THE "ACT"), ARE "RESTRICTED  SECURITIES," AND MAY NOT
         BE  SOLD,  TRANSFERRED  OR  ASSIGNED  EXCEPT  PURSUANT  TO  AN
         EFFECTIVE  REGISTRATION  STATEMENT  UNDER  THE  ACT  OR  IN  A
         TRANSACTION  WHICH, IN THE OPINION OF COUNSEL  SATISFACTORY TO
         THE COMPANY, IS NOT REQUIRED TO BE REGISTERED UNDER THE ACT."

         3.19 Disclosure.  Neither this Agreement, nor any certificate,  exhibit
or other  written  document or  statement,  furnished  to the  Purchaser  by the
Company or the Guarantors in connection  with the  transactions  contemplated by
this Agreement  contains or will contain any untrue statement of a material fact
or omits or will omit to state a material  fact  necessary to be stated in order
to make the statements contained herein or therein not misleading.

                                    ARTICLE 4
           REPRESENTATIONS AND WARRANTIES OF VERTICA AND THE PURCHASER

         Vertica and the Purchaser  hereby  jointly and severally  represent and
warrant to the  Company,  the  Guarantors  and each of them as follows (it being
acknowledged  that  the  Company  and the  Guarantors  are  entering  into  this
Agreement in material  reliance upon each of the following  representations  and
warranties,  and that the  truth and  accuracy  of each of which  constitutes  a
condition  precedent  to the  obligations  of the  Company  and  the  Guarantors
hereunder):

         4.1 Authorization.

                  (a) Vertica has full power,  legal  capacity and  authority to
enter into this Agreement and all attendant documents and instruments  necessary
to consummate the

                                      -9-
<PAGE>

transactions  herein  contemplated;  and to perform all of the obligations to be
performed  by  Vertica  hereunder.  This  Agreement  and all  other  agreements,
documents and instruments to be executed in connection  herewith by Vertica have
been effectively authorized by all necessary action,  corporate or otherwise, on
the part of Vertica,  which  authorizations  remain in full force and effect and
have been duly executed and delivered by Vertica  and/or the  Purchaser,  and no
other corporate proceedings on the part of Vertica are required to authorize the
execution and delivery of this Agreement,  such other agreements,  documents and
instruments and the transactions  contemplated  hereby.  This Agreement and such
other  agreements,  documents  and  instruments  have  been  duly  executed  and
delivered by Vertica and the Purchaser;  constitute the legal, valid and binding
obligation of Vertica and the  Purchaser;  and are  enforceable  with respect to
Vertica and the Purchaser in accordance with their respective  terms,  except as
enforcement  thereof may be limited by bankruptcy,  insolvency,  reorganization,
priority or other laws or court decisions relating to or affecting generally the
enforcement  of creditors'  rights or affecting  generally the  availability  of
equitable  remedies.  Neither the execution and delivery of this Agreement,  the
consummation by Vertica of any of the transactions  contemplated  hereby nor the
compliance by Vertica with any of the  provisions  hereof will (i) conflict with
or  result in a breach  of,  violation  of or  default  under any of the  terms,
conditions or provisions of any note, bond, mortgage, indenture, license, lease,
credit  agreement  or  other  agreement,   document,  instrument  or  obligation
(including,  without  limitation,  any of Vertica's charter  documents) to which
Vertica is a party or by which  Vertica or any of the  assets or  properties  of
Vertica may be bound or (ii) violate any judgment,  order,  injunction,  decree,
statute,  rule or  regulation  applicable  to  Vertica  or any of the  assets or
properties of Vertica.  To the best knowledge of Vertica and the  Purchaser,  no
authorization,  consent or approval of any public body or authority is necessary
for  the  consummation  by  Vertica  of the  transactions  contemplated  by this
Agreement.

                  (b) The Purchaser has full power, legal capacity and authority
to enter  into  this  Agreement  and all  attendant  documents  and  instruments
necessary to consummate the transactions herein  contemplated;  to sell, assign,
transfer,  convey and deliver the Vertica  Common Shares to the Company;  to pay
the  total  sum  of  $25,000  in  cash  to the  Gurarantors  for  the  purchase,
acquisition  and receipt of a total of 480,000  restricted  shares of Perfection
Common Stock owned of record and beneficially by the Guarantors;  and to perform
all of the  obligations  to be  performed  by them  hereunder.  All  agreements,
documents and instruments to be executed in connection  herewith by Vertica have
been effectively authorized by all necessary action,  corporate or otherwise, on
the part of Vertica,  which  authorizations  remain in full force and effect and
have been  duly  executed  and  delivered  by  Vertica,  and no other  corporate
proceedings  on the part of Vertica are required to authorize  the execution and
delivery of such agreements,  documents and instruments. This Agreement has been
duly executed and delivered by the Purchaser,  constitutes the legal,  valid and
binding  obligation  of the  Purchaser  and is  enforceable  with respect to the
Purchaser in  accordance  with its terms,  except as  enforcement  hereof may be
limited by  bankruptcy,  insolvency,  reorganization,  priority or other laws or
court decisions relating to or affecting generally the enforcement of creditors'
rights or affecting  generally the availability of equitable  remedies.  Neither
the  execution  and  delivery  of this  Agreement  nor the  consummation  by the
Purchaser  and  Vertica  of any  of the  transactions  contemplated  hereby,  or
compliance by the Purchaser and Vertica with any of the provisions hereof,  will
(i) conflict with or result in a breach of, violation of or default under any of
the terms,  conditions  or provisions of any note,  bond,  mortgage,  indenture,
license,  lease,  credit agreement or other agreement,  document,  instrument or
obligation (including,  without limitation,  any of Vertica's charter documents)
to which  either the  Purchaser  or Vertica are  parties or by which  either the
Purchaser or Vertica or any of the assets or  properties of either the Purchaser
or Vertica may be bound or (ii) violate any judgment, order, injunction, decree,
statute, rule or regulation applicable to either the Purchaser or Vertica or any
of the assets or  properties  of either the  Purchaser  or Vertica.  To the best
knowledge of the Purchaser and Vertica, no authorization, consent or approval of
any public body or authority is necessary for the  consummation by the Purchaser
and Vertica of the transactions contemplated by this Agreement.

                                      -10-
<PAGE>

         4.2 Ownership of Vertica.  The Purchaser owns 4,930,000  Vertica Common
Shares,  constituting all of the issued and outstanding  shares of capital stock
of  Vertica,  free  and  clear  of  (i)  any  lien,  charge,  mortgage,  pledge,
conditional sale agreement or other encumbrance of any kind or nature whatsoever
and (ii) any claim as to  ownership  thereof or any  rights,  powers or interest
therein by any third party,  whether legal or  beneficial,  and whether based on
contract, proxy or other document or otherwise. All of the Vertica Common Shares
have  been  duly   authorized   and  validly   issued  and  are  fully-paid  and
nonassessable.  Except as set forth in this Section 4.2,  there are no warrants,
options, calls, commitments or other rights to subscribe for or to purchase from
Vertica  any  capital  stock of Vertica or any  securities  convertible  into or
exchangeable for any shares of capital stock of Vertica, or any other securities
or agreement  pursuant to which Vertica is or may become  obligated to issue any
shares of its capital stock, nor is there outstanding any commitment, obligation
or agreement on the part of Vertica to repurchase,  redeem or otherwise  acquire
any of the outstanding shares of Vertica.

         4.3  Organization  and Corporate  Power.  Vertica is a corporation duly
organized,  validly existing and in good standing under the laws of the State of
California,  and is duly  qualified  and in good  standing  to do  business as a
foreign corporation in each jurisdiction in which such qualification is required
and where the failure to be so qualified would have a materially  adverse effect
upon Vertica. Vertica has all requisite corporate power and authority to conduct
its business as now being conducted and to own and lease the properties which it
now owns and leases.  The Articles of  Incorporation  of Vertica,  as amended to
date,  certified  by the  Secretary  of State of  California,  and the Bylaws of
Vertica,  as amended to date,  certified by the  President  and the Secretary of
Vertica, which have been delivered to the Company prior to the execution hereof,
are  true  and  complete  copies  thereof  as in  effect  as of the date of this
Agreement.

         4.4 Financial  Statements.  Attached  hereto as Exhibit G is a true and
complete  copy of the  unaudited  balance sheet of Vertica as of August 10, 1998
(the "Vertica Balance Sheet"), the related unaudited statement of profit or loss
for the  period  then  ended and the  related  notes  thereto,  which  have been
certified to by the chief executive  officer and the chief financial  officer of
Vertica.  Such financial  statements (and the notes related  thereto) are herein
sometimes  collectively  referred to as the "Vertica Financial  Statements." The
Vertica  Financial  Statements  (i) are  derived  from the books and  records of
Vertica,  which books and records have been consistently  maintained in a manner
which reflects, and such books and records do fairly and accurately reflect, the
assets and  liabilities  of  Vertica,  (ii)  fairly and  accurately  present the
financial  condition of Vertica on the respective  dates of such  statements and
the  results  of its  operations  for the  periods  indicated,  except as may be
disclosed  in the notes  thereto,  and (iii) have been  prepared in all material
respects  in  accordance   with   generally   accepted   accounting   principles
consistently  applied  throughout  the  periods  involved  (except as  otherwise
disclosed in the notes thereto).

         4.5  Subsidiaries.  Verttica has no  subsidiaries  and no  investments,
directly or indirectly,  or other financial interest in any other corporation or
business organization, joint venture or partnership of any kind whatsoever.

         4.6  Absence of  Undisclosed  Liabilities.  Except as and to the extent
reflected or reserved  against in the Vertica  Balance Sheet,  and as to matters
arising in the ordinary  course of the business of Vertica since the date of the
Vertica  Balance Sheet which are  disclosed on Exhibit G hereto,  Vertica has no
liability(s) or obligation(s)  (whether  accrued,  to become due,  contingent or
otherwise)  which  individually  or in the  aggregate  could  have a  materially
adverse  effect on the business,  assets,  properties,  condition  (financial or
otherwise) or prospects of Vertica.

                                      -11-
<PAGE>

         4.7 Absence of Certain Developments.  Except as described on Exhibit G,
since the date of the Vertica  Balance  Sheet,  there has been (i) no materially
adverse  change in the  condition  (financial or otherwise) of Vertica or in the
assets,  liabilities,  properties,  business,  operations or prospects of either
corporation;  (ii) no  declaration,  setting aside or payment of any dividend or
other  distribution  with respect to the Vertica  Common  Shares or  redemption,
purchase or other  acquisition  of any Vertica  Common Shares or any split-up or
other  recapitalization  relative  to any  Vertica  Common  Shares or any action
authorizing  or obligating  Vertica to do any of the  foregoing;  (iii) no loss,
destruction or damage to any material  property or asset of Vertica,  whether or
not insured;  (iv) no  acquisition  or disposition of assets (or any contract or
arrangement  therefor),  or any other  transaction by Vertica otherwise than for
fair  value  and in the  ordinary  course  of  business;  (v)  no  discharge  or
satisfaction  by Vertica of any lien or encumbrance or payment of any obligation
or liability  (absolute or contingent)  other than current  liabilities shown on
the  Vertica  Balance  Sheet,  or current  liabilities  incurred  since the date
thereof in the ordinary course of business; (vi) no sale, assignment or transfer
by Vertica of any of the tangible or  intangible  assets of either  corporation,
cancellation  by Vertica  of any  debts,  claims or  obligations,  or  mortgage,
pledge,  satisfaction of any assets to any lien,  charge,  security  interest or
other encumbrance or waiver by Vertica of any rights of value which, in any such
case,  is material to the  business of Vertica  (whether or not in the  ordinary
course  of  business);  (vii)  no  payment  of any  bonus  to or  change  in the
compensation of any director,  officer or employee of Vertica,  whether directly
or by means of any bonus,  pension plan, contract or commitment and no change in
employee compensation,  whether directly or by means of any bonus, pension plan,
contract  or  commitment;  (viii) no  write-off  or  material  reduction  in the
carrying  value of any asset which is material to the business of Vertica;  (ix)
no  disposition  or lapse  of  rights  as to any  intangible  property  which is
material to the business of Vertica; (x) except for ordinary travel advances, no
loans or extensions of credit to shareholders,  officers, directors or employees
of  Vertica;  (xi) no entry  into  any  commitment  or  transaction  by  Vertica
(including,  without limitation, any borrowing or capital expenditure) involving
an amount in excess of $5,000.00;  (xii) no issuance of any capital stock, or of
any other security  convertible  into any of the capital stock,  of Vertica;  or
(xiii) any agreement to do any of the things described in this Section 4.7.

         4.8 Real Property.  Exhibit G attached  hereto  contains a complete and
accurate  legal  description of each parcel of real property owned by, leased to
and/or occupied by Vertica,  and Vertica  neither owns,  leases nor occupies any
other real property.  The buildings and all fixtures and improvements located on
such real  property  are in good  operating  condition,  ordinary  wear and tear
excepted.  Vertica  is not  in  violation  of any  zoning,  building  or  safety
ordinance,  regulation or requirement  or other law or regulation  applicable to
the  operation of owned or leased  properties,  and Vertica has not received any
notice of  violation  with which it has not  complied.  Vertica  has, and on the
Closing  Date will have,  good and  marketable  title to all such real  property
owned  by  Vertica,  free  and  clear  of all  liens,  mortgages,  encumbrances,
easements,  leases, restrictions and claims of any kin whatsoever except for (i)
those  matters shown on Exhibit G, (ii) liens for taxes for the current year and
tax  assessments  not yet due and payable and (iii)  mechanics' or similar liens
for  materials or services  furnished or to be furnished  after the date hereof.
All leases of real  property to which  Vertica is a party and which are material
to the  business  of  Vertica  are fully  effective  in  accordance  with  their
respective terms and afford Vertica  peaceful and undisturbed  possession of the
subject matter of the lease,  and there exists no default on the part of Vertica
or termination thereof, except as may be set forth on Exhibit G.

         4.9 Tangible Personal Property. Exhibit G sets forth a complete list of
all items of tangible  personal  property owned or leased and used by Vertica in
the current  conduct of its business  where the  original  cost was in excess of
$5,000.00.  Except as set forth on Exhibit G,  Vertica  has,  and at the Closing
will have, good and marketable title to, and be in possession of, all such items
of  personal  property  owned  by it,  free  and  clear  of all  title  defects,
mortgages,  pledges,  security interests,  conditional sales agreements,  liens,
restrictions or encumbrances

                                      -12-
<PAGE>

whatsoever.  Included on Exhibit G is a list of all outstanding equipment leases
and  maintenance  agreements  to which  Vertica  is a party as lessee  and which
individually provide for future lease payments in excess of $5,000.00,  with the
identities of the other parties to all such leases and agreements shown thereon.
All leases of tangible  personal  property to which Vertica is a party and which
are material to the business of Vertica are fully  effective in accordance  with
their  respective  terms,  and there exists no default on the part of Vertica or
termination  thereof,  except  as may be set  forth on  Exhibit  G. Each item of
capital equipment which is used in the current conduct of Vertica's business is,
and on the Closing  Date will be, in good  operating  and usable  condition  and
repair,  ordinary wear and tear excepted, and is and will be suitable for use in
the  ordinary  course of Vertica's  business and fit for its intended  purposes,
except as may be set forth on Exhibit G.

         4.10 Tax Matters.  Vertica  has,  since its  inception,  duly filed all
Federal,  state,  county and local tax returns required to have been filed by it
in those jurisdictions where the nature or conduct of its business requires such
filing and where the failure to so file would be materially  adverse to Vertica.
Copies of all such tax returns have been  furnished to the Company  prior to the
execution hereof. All Federal,  state, county and local taxes, including but not
limited to those taxes due with respect to Vertica's  properties,  income, gross
receipts,  excise, occupation,  franchise,  permit, licenses, sales, payroll and
inventory due and payable as of the Closing by Vertica have been paid. No amount
is  required to be  reflected  in the Vertica  Balance  Sheet as a liability  or
reserve  for taxes  which are due but not yet  payable  are  sufficient  for the
payment of all accrued and unpaid taxes of the types referred to hereinabove.

         4.11  Contracts and  Commitments.  Vertica has no contract,  agreement,
obligation or commitment,  written or verbal, express or implied, which involves
a commitment  or liability in excess of $5,000.00 or for a term of more than six
months,  and no union  contracts,  employee or consulting  contracts,  financing
agreements, debtor or creditor arrangements, licenses, franchise, manufacturing,
distributorship  or  dealership  agreements,  leases or  bonus,  health or stock
option plans,  except as described on Exhibit G. True and complete copies of all
such contracts and other agreements listed on Exhibit G have been made available
to the Company prior to the execution hereof.  Neither Vertica nor the Purchaser
has any  knowledge  of any  circumstances  which  would  affect the  validity or
enforceability  of any of such contracts and other agreements in accordance with
their respective terms. Vertica and the Purchaser have performed and complied in
all material  respects with all obligations  required to be performed by them to
date under, and are not in default (without giving effect to any required notice
or grace period) under, or in breach of, the terms,  conditions or provisions of
any of such contracts and other agreements.  The validity and  enforceability of
any  contract or other  agreement  described  herein  shall not in any manner be
affected by the  execution  and delivery of this  Agreement  without any further
action.

         4.12 Patents,  Trade Secrets and Customer Lists.  Vertica does not have
any patents, applications for patents, trademarks,  applications for trademarks,
trade  names,  licenses or service  marks  relating  to the  business of Vertica
except as set forth on Exhibit G hereto, nor does any present or former officer,
director or employee of Vertica own any patent  rights  relating to any products
manufactured,  rented or sold by  Vertica.  Except as  disclosed  on  Exhibit G,
Vertica  has the  unrestricted  right to use,  free and  clear of any  claims or
rights of others, all trade secrets, customer lists and manufacturing and secret
processes  reasonably necessary to the manufacture and marketing of all products
made or proposed to be made by Vertica,  and the continued use thereof after the
Closing  by Vertica  and will not  conflict  with,  infringe  upon or  otherwise
violate any rights of others.  Except as set forth on Exhibit G, Vertica has not
used and is not making use of any  confidential  information or trade secrets of
any present or past employee of Vertica.

         4.13 No Pending Material Litigation or Proceedings. Except as disclosed
on Exhibit G, there are no actions,  suits or proceedings  pending or threatened
against or affecting  Vertica  (including  actions,  suits or proceedings  where
liabilities  may be  adequately  covered  by

                                      -13-
<PAGE>

insurance) at law or in equity or before or by any Federal,  state, municipal or
other governmental  department,  commission,  court,  board,  bureau,  agency or
instrumentality,  domestic  or  foreign,  or  affecting  any of the  officers or
directors of Vertica in connection  with the business,  operations or affairs of
Vertica, which might result in any adverse change in the business, properties or
assets, or in the condition  (financial or otherwise) of Vertica, or which might
prevent the sale of the Vertica Common Shares pursuant to this Agreement. Except
as disclosed on Exhibit G, Vertica has not,  during the three (3) years prior to
the Closing Date,  been threatened  with any action,  suit,  proceeding or claim
(including  actions,  suits,  proceedings or claims where its liabilities may be
adequately covered by insurance) for personal injuries allegedly attributable to
products sold or services  performed by Vertica asserting a particular defect or
hazardous property in any of Vertica's respective products, services or business
practices  or  methods,  nor has  Vertica  been a party  to or  threatened  with
proceedings  brought by or before any Federal or state  agency;  and the Company
has no knowledge of any defect or  hazardous  property  claimed or actual in any
such product,  service or business practice or method. Vertica is not subject to
any voluntary or involuntary  proceeding under the United States Bankruptcy Code
and has not made an assignment for the benefit of creditors.

         4.14 Insurance.  Vertica maintains  insurance with reputable  insurance
companies  on such of  Vertica's  equipment,  tools,  machinery,  inventory  and
properties  as are usually  insured by companies  similarly  situated and to the
extent  customarily  insured,  and  maintain  products  and  personal  liability
insurance,  workers'  compensation  insurance and such other  insurance  against
hazards,  risks and  liability  to persons  and  property  as is  customary  for
companies  similarly   situated.   A  true  and  complete  listing  and  general
description of each of Vertica's insurance policies as currently in force is set
forth on Exhibit G hereto.  All such insurance  policies are, and at the Closing
shall be, in full force and effect.

         4.15  Arrangements  with  Personnel.  Except as set forth on  Exhibit G
hereto,  no stockholder,  director,  officer or employee is presently a party to
any transaction with Vertica, including without limitation any contract, loan or
other agreement or arrangement  providing for the furnishing of services by, the
rental of real or personal property from or to, or otherwise  requiring loans or
payments to, any such  stockholder,  director,  officer or  employee,  or to any
member  of  the  family  of  any  of  the  foregoing,  or  to  any  corporation,
partnership,  trust or other entity in which any stockholder,  director, officer
or  employee  or any  member  of the  family  of any of them  has a  substantial
interest or is an officer, director,  trustee, partner or employee. There is set
forth on Exhibit G a list showing (i) the name,  title,  date and amount of last
compensation  increase,  and aggregate  compensation,  including amounts paid or
accrued pursuant to any bonus,  pension,  profit sharing,  commission,  deferred
compensation  or other  plans or  arrangements  in effect as of the date of this
Agreement,  of each  officer,  employee,  agent or  contractor  of Vertica whose
salary  and other  compensation,  in the  aggregate,  received  from  Vertica or
accrued is at an annual  rate (or  aggregated  for the most  recently  completed
fiscal  year) in  excess  of  $1,000.00,  as well as any  employment  agreements
relating to any such  persons;  (ii) all powers of attorney  from Vertica to any
person or entity;  (iii) the name of each person or entity  authorized to borrow
money or incur or guarantee  indebtedness on behalf of Vertica;  (iv) all safes,
vaults and safe  deposit  boxes  maintained  by or on behalf of Vertica  and the
names of all persons  authorized  to have access  thereto;  and (v) all bank and
savings  accounts of Vertica  and the names of all  persons  who are  authorized
signatories  with respect to such  accounts,  the  capacities  in which they are
authorized and the terms of their authorizations.

         4.16 Labor Relations.  Vertica has no obligations  under any collective
bargaining  agreement or other contract with a labor union, under any employment
contract or consulting  agreement or under any  executive's  compensation  plan,
agreement  or  arrangement,  nor is any union,  labor  organization  or group of
employees  of  Vertica  presently  seeking  the right to enter  into  collective
bargaining with Vertica on behalf of any of the employees of either corporation,
except as set forth on Exhibit G. Vertica has furnished to the Company a copy of
all  written

                                      -14-
<PAGE>

personnel policies,  including without limitation  vacation,  severance,  bonus,
pension, profit sharing and commissions policies, applicable to any of Vertica's
employees.

         4.17  Compliance  with Laws.  To the best  knowledge of Vertica and the
Purchaser,  Vertica holds all licenses,  franchises,  permits and authorizations
necessary for the lawful conduct of its business as presently conducted, and has
complied with all applicable statutes,  laws, ordinances,  rules and regulations
of all  governmental  bodies,  agencies and  subdivisions  having,  asserting or
claiming  jurisdiction over said  corporations,  with respect to any part of the
conduct of its businesses and corporate affairs.

         4.18 Relationships with Customers and Suppliers. No present customer or
substantial  supplier to Vertica has  indicated  an  intention  to  terminate or
materially and adversely alter its existing business  relationship with Vertica,
and the  Purchaser  has no  reason  to  believe  that any of  Vertica's  present
customers or substantial suppliers intends to do so.

         4.19 Brokerage.  At the Closing, the Purchaser agrees to pay to each of
Summit Financial Relations,  Inc., and Columbine Financial Solutions,  Inc., the
amount of $25,000 (an aggregate of $50,000), as finders' fees in connection with
the  transactions  contemplated  by this  Agreement,  and,  except as aforesaid,
neither the Purchaser nor Vertica has any obligation to any person or entity for
brokerage commissions,  finders' fees or similar compensation in connection with
the transactions  contemplated by this Agreement.  The Purchaser shall indemnify
and hold the Guarantors,  or either of them,  harmless  against any liability or
expenses  arising  out of any such claim  asserted  against the  Guarantors,  or
either of them, by any party.

         4.20 Investment Representation.  The Purchaser and Vertica, through the
Purchaser,  have the knowledge and experience in business and financial  matters
to meaningfully evaluate the merits and risks of the purchase and acquisition of
the Shares of  Perfection  Common  Stock in exchange and  consideration  for the
issuance and sale of the Vertica Common Shares as contemplated hereby.  Further,
the Purchaser has the knowledge and experience in business and financial matters
to meaningfully evaluate the merits and risks of the purchase and acquisition of
480,000  restricted  shares of  Perfection  Common  Stock  owned of  record  and
beneficially by the Guarantors in consideration for the payment therefor of cash
in the total  amount of $25,000.  The  Purchaser  and Vertica  shall  conduct an
independent review of the business, assets, properties, books and records of the
Company for the purpose of satisfying  themselves as to the truth,  accuracy and
completeness of the  representations  and warranties made by the Company and the
Guarantors.  The Purchaser  understands  and  acknowledges  that the  Perfection
Common  Stock  to  be  issued,  sold,  assigned,  transferred,  conveyed  and/or
delivered to him in the transactions  contemplated hereby will be issued,  sold,
assigned,  transferred,  conveyed  and/or  delivered  by  the  Company  and  the
Guarantors  without  registration or  qualification  or other filings being made
under the U.S.  Securities  Act of 1933,  as amended,  or any  applicable  state
securities or "Blue Sky" law, in reliance upon  specific  exemptions  therefrom,
and  in  furtherance  thereof  the  Purchaser  represents  that  the  shares  of
Perfection  Common  Stock will be taken and  received by him for his own account
for  investment,  with no present  intention of a  distribution  or  disposition
thereof  to others.  The  Purchaser  further  acknowledges  and agrees  that the
certificate(s)  representing  the shares of  Perfection  Common Stock issued and
sold  to him  shall  be  subject  to a  stop-transfer  order  and  shall  bear a
restrictive legend, in substantially the following form:

         "THE SECURITIES  REPRESENTED BY THIS  CERTIFICATE  WERE ISSUED
         WITHOUT  REGISTRATION  UNDER THE  SECURITIES  ACT OF 1933,  AS
         AMENDED (THE "ACT"), ARE "RESTRICTED  SECURITIES," AND MAY NOT
         BE  SOLD,  TRANSFERRED  OR  ASSIGNED  EXCEPT  PURSUANT  TO  AN
         EFFECTIVE  REGISTRATION  STATEMENT  UNDER  THE  ACT  OR  IN  A
         TRANSACTION  WHICH, IN THE OPINION OF COUNSEL  SATISFACTORY

                                 -15-
<PAGE>

         TO THE COMPANY, IS NOT REQUIRED TO BE REGISTERED UNDER THE ACT."

         4.21 Disclosure.  Neither this Agreement, nor any certificate,  exhibit
or  other  written  document  or  statement,  furnished  to the  Company  or the
Guarantors  by the  Purchaser  or Vertica in  connection  with the  transactions
contemplated by this Agreement  contains or will contain any untrue statement of
a material fact or omits or will omit to state a material  fact  necessary to be
stated  in  order  to make  the  statements  contained  herein  or  therein  not
misleading.

                                    ARTICLE 5
     OBLIGATIONS OF THE COMPANY AND THE GUARANTORS PRIOR TO CLOSING

         The Company and the Guarantors hereby jointly and severally covenant to
and agree with  Vertica and the  Purchaser  that between the date hereof and the
Closing:

         5.1 Access to Properties and Records.

         (a) The  Guarantors  shall cause the  Company to give to  Vertica,  the
Purchaser and their authorized  representatives  full access,  during reasonable
business  hours,  in such a manner as not  unduly  to  disrupt  normal  business
activities,  to any  and  all of the  premises,  properties,  contracts,  books,
records and affairs of the  Company,  and will cause the officers of the Company
to furnish any and all data and  information  pertaining  to the business of the
Company that Vertica,  the Purchaser and their  authorized  representatives  may
from time to time reasonably require.

         (b) Unless and until the  transactions  contemplated  by this Agreement
have been consummated,  the Purchaser,  Vertica and their  representatives shall
hold  in  confidence  all  information  so  obtained  and  if  the  transactions
contemplated  hereby are not consummated  will return all documents  hereinabove
referred to and obtained  from the Company or its officers.  Such  obligation of
confidentiality  shall not extend to any information which is shown to have been
previously (i) known to the Purchaser or Vertica; (ii) generally known to others
engaged in the trade or business of the Company;  (iii) part of public knowledge
or  literature;  or (iv) lawfully  received by the  Purchaser,  Vertica or their
authorized representatives from a third party.

         5.2 Corporate  Existence,  Rights and Franchises.  The Guarantors shall
take all  necessary  actions to cause the  Company to maintain in full force and
effect the  corporate  existence,  rights,  franchises  and good standing of the
Company.  No change shall be made in the Articles of Incorporation,  as amended,
or Bylaws of the Company.

         5.3 Conduct of Business in the Ordinary  Course.  The Guarantors  shall
not  permit to be done any act which  would  result in the  breach of any of the
covenants of the Company or the Guarantors contained herein or which would cause
the representations  and warranties of the Company and the Guarantors  contained
herein to become  untrue or  inaccurate  as of any date  subsequent  to the date
hereof.  Without limiting the generality of the foregoing,  the Guarantors shall
take all  necessary  actions to cause the Company to (i)  operate  its  business
diligently in the ordinary course of business as an ongoing concern and will use
their best efforts to preserve intact the Company's  organization and operations
at current levels, to retain the services of the Company's present employees and
to preserve the  Company's  relationships  with its  suppliers and customers and
others having  business  relationships  with the Company;  (ii) maintain in good
operating  condition,  ordinary  wear and tear  excepted,  all of the  Company's
assets and properties  which are in such condition as of the date hereof;  (iii)
maintain the books,  accounts  and records of the Company in the usual,  regular
and ordinary manner on a basis  consistent with past practice in recent periods;
(iv) refrain from  entering into any contract,  agreement,  sales order,  lease,

                                 -16-
<PAGE>

capital expenditure or other commitment of a value in excess of $1,000.00 (other
than purchases of raw materials and sales of inventory in the ordinary course of
business),  or from  modifying,  amending,  canceling or terminating any of such
contracts, agreements, leases or other commitments presently in force, except as
expressly contemplated by this Agreement,  without the prior approval of Vertica
and the Purchaser  (which approval shall not be unreasonably  withheld and which
may be verbal to be followed by written  confirmation);  (v) refrain from paying
any bonus to any employee,  officer or director and from declaring or paying any
dividend, or making any other distribution in respect of, or from redeeming, the
Perfection  Common Stock; and (vi) refrain from issuing any capital stock of the
Company or any other securities convertible into such capital stock.

                                    ARTICLE 6
       OBLIGATIONS OF VERTICA AND THE PURCHASER PRIOR TO CLOSING

         Vertica and the Purchaser hereby jointly and severally  covenant to and
agree with the Company and the  Guarantors  that between the date hereof and the
Closing:

         6.1      Access to Properties and Records.

         (a) The  Purchaser  shall  cause  Vertica to give to the  Company,  the
Guarantors and their authorized  representatives full access,  during reasonable
business  hours,  in such a manner as not  unduly  to  disrupt  normal  business
activities,  to any  and  all of the  premises,  properties,  contracts,  books,
records  and  affairs  of  Vertica,  and will cause the  officers  of Vertica to
furnish any and all data and  information  pertaining to the business of Vertica
that the Company,  the Guarantors and their authorized  representatives may from
time to time reasonably require.

         (b) Unless and until the  transactions  contemplated  by this Agreement
have been  consummated,  the Company,  the Guarantors and their  representatives
shall hold in confidence  all  information  so obtained and if the  transactions
contemplated  hereby are not consummated  will return all documents  hereinabove
referred  to  and  obtained  from  Vertica  or the  officers  of  Vertica.  Such
obligation of confidentiality shall not extend to any information which is shown
to have  been  previously  (i)  known to the  Company  or the  Guarantors;  (ii)
generally  known to others  engaged in the trade or business  of Vertica;  (iii)
part of  public  knowledge  or  literature;  or (iv)  lawfully  received  by the
Company, the Guarantors or their authorized representatives from a third party.

         6.2 Corporate  Existence,  Rights and  Franchises.  The Purchaser shall
take all necessary actions to cause Vertica to maintain in full force and effect
the corporate  existence,  rights,  franchises and good standing of Vertica.  No
change shall be made in the Articles of Incorporation, as amended, or Bylaws, as
amended, of Vertica.

         6.3 Insurance.  The Purchaser shall take all necessary actions to cause
Vertica to maintain in force all of its  existing  insurance  policies,  subject
only to  variations in amounts  required by the ordinary  operation of Vertica's
business.

         6.4 Conduct of Business in the Ordinary Course. The Purchaser shall not
permit  to be done  any act  which  would  result  in the  breach  of any of the
covenants of the Purchaser or Vertica  contained herein or which would cause the
representations  and warranties of the Purchaser or Vertica  contained herein to
become  untrue  or  inaccurate  as of any date  subsequent  to the date  hereof.
Without  limiting the generality of the foregoing,  the Purchaser shall take all
necessary actions to cause Vertica to (i) operate its business diligently in the
ordinary  course of business as an ongoing concern and will use his best efforts
to preserve intact Vertica's  organization and operations at current levels,  to
retain the services of Vertica's  present

                                 -17-
<PAGE>

employees  and to  preserve  Vertica's  relationships  with  its  suppliers  and
customers and others having business  relationships with Vertica;  (ii) maintain
in good operating condition,  ordinary wear and tear excepted,  all of Vertica's
assets and properties  which are in such condition as of the date hereof;  (iii)
maintain the books,  accounts  and records of Vertica in the usual,  regular and
ordinary manner on a basis consistent with past practice in recent periods; (iv)
refrain from entering into any contract,  agreement, sales order, lease, capital
expenditure  or other  commitment of a value in excess of $5,000.00  (other than
purchases of raw  materials  and sales of  inventory  in the ordinary  course of
business),  or from  modifying,  amending,  canceling or terminating any of such
contracts, agreements, leases or other commitments presently in force, except as
expressly  contemplated  by this  Agreement,  without the prior  approval of the
Company and the Guarantors  (which approval shall not be  unreasonably  withheld
and which may be verbal to be  followed  by written  confirmation);  (v) refrain
from paying any bonus to any employee, officer or director and from declaring or
paying any  dividend,  or making any other  distribution  in respect of, or from
redeeming,  the Vertica Common Shares; and (vi) refrain from issuing any capital
stock of Vertica or any other securities convertible into such capital stock.

         6.5 Consent of the California Commissioner of Corporations. Vertica and
the Purchaser  shall execute such documents and take such further  actions as in
the opinion of counsel to the Purchaser shall be reasonably  necessary to obtain
the consent of the California  Commissioner  of  Corporations to the transfer of
the Vertica Common Shares from the Purchaser to the Company.

                                    ARTICLE 7
                  CONDITIONS TO THE OBLIGATIONS OF THE PARTIES

         The  respective  obligations  of the parties  hereto to consummate  the
transactions  contemplated  hereby  shall be subject to the  fulfillment,  at or
prior to the Closing, of the following conditions:

         7.1  Regulatory  Approvals.  There shall have been obtained any and all
permits,  approvals  and  qualifications  of, and there  shall have been made or
completed  all  filings,  proceedings  and  waiting  periods  required  by,  any
governmental  body,  agency or regulatory  authority  which,  in the  reasonable
opinion of counsel to the Company,  the  Guarantors,  Vertica and the Purchaser,
are required for the consummation of the transactions contemplated hereby.

         7.2 No Action or Proceeding.  No claim, action, suit,  investigation or
other proceeding shall be pending or threatened before any court or governmental
agency which presents a substantial  risk of the restraint or prohibition of the
transactions contemplated by this Agreement or the obtaining of material damages
or other relief in connection therewith.

         7.3  Obligations  of Vertica  and the  Purchaser.  The  obligations  of
Vertica and the Purchaser hereunder to consummate the transactions  contemplated
by this  Agreement  are  expressly  subject to the  satisfaction  of each of the
further conditions set forth below, any or all of which may be waived by Vertica
and the Purchaser,  jointly and not severally, in whole or in part without prior
notice; provided, however, that no such waiver of a condition shall constitute a
waiver by Vertica or the  Purchaser  of any other  condition  or of any of their
rights or remedies,  at law or in equity, if the Company or the Guarantors shall
be in default or breach of any of their representations, warranties or covenants
under this Agreement:

         (a) Vertica and the  Purchaser,  severally and not jointly,  shall have
received copies of resolutions (certified as of the date of the Closing as being
in full force and effect by an appropriate  officer of the Company) duly adopted
by the Board of Directors of the Company

                                      -18-
<PAGE>

adopting and  approving  this  Agreement,  which shall be in form and  substance
reasonably satisfactory to Vertica and the Purchaser and their counsel.

         (b) The Company and the Guarantors  shall have performed the agreements
and covenants required to be performed by them under this Agreement prior to the
Closing,  and there shall have been no material  adverse change in the condition
(financial  or  otherwise),  assets,  liabilities,  earnings  or business of the
Company since the date hereof,  and the  representations  and  warranties of the
Company and the Guarantors  contained  herein shall,  except as  contemplated or
permitted by this Agreement or as qualified in a writing dated as of the Closing
Date delivered by the Company to Vertica and the Purchaser, with the approval of
Vertica and the Purchaser  indicated  thereon  (which  writing is to be attached
hereto as Exhibit H), be true in all material  respects on and as of the Closing
Date as if made on and as of such date, and Vertica and the Purchaser, severally
and not  jointly,  shall have  received a  certificate,  dated as of the Closing
Date,  signed by the chief executive  officer and the chief financial officer of
the  Company,  reasonably  satisfactory  to Vertica and the  Purchaser,  to such
effect.

         (c) Vertica and the Purchaser  shall have received a certificate of the
Guarantors,  reasonably satisfactory to Vertica and the Purchaser, to the effect
that the Company and the Guarantors  have performed the agreements and covenants
required to be performed by them under this Agreement prior to the Closing, that
there  has been no  material  adverse  change  in the  condition  (financial  or
otherwise),  assets, liabilities,  earnings or business of the Company since the
date hereof, and that the  representations and warranties of the Company and the
Guarantors  contained herein continue to be true in all material respects on and
as of the Closing Date as if made on and as of such date, except as contemplated
or permitted by this Agreement or as qualified in Exhibit H.

         (d) The opinion letter of counsel to the Company  substantially  in the
form attached hereto as Exhibit B.

         (e) The directors of the Company shall have resigned their positions as
Company  directors  effective  as of the Closing  Date after one or more of said
directors has caused the election of the slate of directors  proposed by Vertica
and the Purchaser.

         7.4 Obligations of the Company and the  Guarantors.  The obligations of
the  Company  and  the  Guarantors  hereunder  to  consummate  the  transactions
contemplated by this Agreement are expressly subject to the satisfaction of each
of the further  conditions set forth below, any or all of which may be waived by
the Company and the Guarantors,  jointly and not severally,  in whole or in part
without  prior  notice;  provided,  however,  that no such waiver of a condition
shall  constitute  a  waiver  by the  Company  or the  Guarantors  of any  other
condition  or of any of their rights or  remedies,  at law or in equity,  if the
Purchaser   or  Vertica   shall  be  in  default  or  breach  of  any  of  their
representations, warranties or covenants under this Agreement:

         (a) The Company and the  Guarantors,  severally and not jointly,  shall
have received copies of resolutions  (certified as of the date of the Closing as
being in full force and effect by an  appropriate  officer of the Company)  duly
adopted  by the Board of  Directors  of  Vertica  adopting  and  approving  this
Agreement,  which shall be in form and substance reasonably  satisfactory to the
Company and the Guarantors and their counsel.

         (b) The Purchaser and Vertica shall have  performed the  agreements and
covenants  required to be  performed by them under this  Agreement  prior to the
Closing,  and there shall have been no material  adverse change in the condition
(financial or otherwise),  assets, liabilities,  earnings or business of Vertica
since the date hereof, and the  representations  and warranties of the Purchaser
and Vertica contained herein shall,  except as contemplated or permitted by this
Agreement or as qualified in a writing dated as of the Closing Date delivered by
the Purchaser

                                      -19-
<PAGE>

and Vertica to the Company and the Guarantors,  with the approval of the Company
and the Guarantors  indicated thereon (which writing is to be attached hereto as
Exhibit I), be true in all material respects on and as of the Closing Date as if
made on and as of such date, and the Company and the  Guarantors,  severally and
not jointly,  shall have received a  certificate,  dated as of the Closing Date,
signed by the chief executive officer and the chief financial officer of Vertica
and by the Purchaser, reasonably satisfactory to the Company and the Guarantors,
to such effect.

         (c) The Company and the  Guarantors,  severally and not jointly,  shall
have  received  a  certificate   of  Vertica  and  the   Purchaser,   reasonably
satisfactory to the Company and the Guarantors, to the effect that the Purchaser
and Vertica have performed the agreements and covenants required to be performed
by them  under  this  Agreement  prior to the  Closing,  that  there has been no
material  adverse  change in the  condition  (financial or  otherwise),  assets,
liabilities, earnings or business of Vertica since the date hereof, and that the
representations  and  warranties of the Purchaser and Vertica  contained  herein
continue to be true in all material respects on and as of the Closing Date as if
made on and as of  such  date,  except  as  contemplated  or  permitted  by this
Agreement or as qualified in Exhibit I.

         (d) The opinion letter of counsel to the Purchaser substantially in the
form attached hereto as Exhibit C.

                                    ARTICLE 8
                      ADDITIONAL AGREEMENTS OF THE PARTIES

         8.1  Taxes and Expenses.

         (a)  Except  as  otherwise   expressly   provided  in  subsection   (b)
immediately below, the Company and the Guarantors,  on the one hand, and Vertica
and the Purchaser, on the other hand, shall each pay all of their own respective
taxes,  attorneys' fees and other costs and expenses  payable in connection with
or as a result of the transactions  contemplated  hereby and the performance and
compliance  with all  agreements  and  conditions  contained  in this  Agreement
respectively to be performed or observed by each of them.

         (b) The Company shall pay any and all Colorado and California taxes, if
any,  which  become due on account of the  issuance,  sale and  delivery  of the
Shares of Perfection Common Stock to the Purchaser.

         8.2  Expiration of Representations and Warranties.

         (a)  The   representations  and  warranties  of  the  Company  and  the
Guarantors contained herein and in any other document or instrument delivered by
or on behalf of them,  as such may be qualified in Exhibit F, shall  survive the
Closing and any investigations  made by or on behalf of Vertica or the Purchaser
prior  thereto,  and shall remain in full force and effect for a period of three
(3) years  after the date of  Closing  (the  "Warranty  Period")  and  thereupon
expire.

         (b) The  representations  and  warranties  of the Purchaser and Vertica
contained  herein and in any other  document or  instrument  delivered  by or on
behalf of them, as such may be qualified in Exhibit G, shall survive the Closing
and any  investigations  made by or on behalf of the  Company or the  Guarantors
prior  thereto,  and shall remain in full force and effect for a period of three
(3) years  after the date of Closing  (the  "Purchaser'  Warranty  Period")  and
thereupon expire.

                                      -20-
<PAGE>

         8.3 Indemnification.

         (a) The  Guarantors,  jointly and severally,  hereby agree to indemnify
and hold the  Purchaser  harmless  with  respect to any and all claims,  losses,
damages,  obligations,  liabilities and expenses, including, without limitation,
reasonable legal and other costs and expenses of investigating and defending any
actions or threatened actions, which the Purchaser may incur or suffer following
the Closing by reason of any breach of any of the representations and warranties
of the Company or the Guarantors  contained  herein,  during the Warranty Period
following the Closing  during which any such  representation  and warranty shall
survive as  provided  herein,  provided  that the  Purchaser  complies  with the
following indemnification procedure:

         (i)      The  Purchaser  shall  give  written  notice  to  the
                  Guarantors of a claim for indemnification  within the
                  Warranty  Period;  which  notice  shall set forth the
                  amount involved in the claim for  indemnification and
                  contain  a  reasonably  thorough  description  of the
                  facts constituting the basis of such claim.

         (ii)     The  Guarantors  shall  have a period of thirty  (30)
                  days from the receipt of the notice referred to above
                  to  respond  to the  indemnity  claim  to the  mutual
                  satisfaction of the Purchaser and the Guarantors.

         (iii)    If a third party claim is asserted which might result
                  in  a  claim  for  indemnification   hereunder,   all
                  information  within the  Purchaser's or the Company's
                  knowledge  or control  relevant  and  material to the
                  defense  of any such  claim  shall  promptly  be made
                  available  to the  Guarantors  and  their  authorized
                  representatives,  and the  Purchaser  and the Company
                  shall otherwise  cooperate with the Guarantors in the
                  defense of the claim.  The Purchaser shall not settle
                  or  compromise  any  such  claim  without  the  prior
                  written  consent of the Guarantors  unless suit shall
                  have been  instituted  against the  Purchaser  or the
                  Company and the Guarantors  shall have failed,  after
                  reasonable notice of institution of the suit, to take
                  control  of  such  suit  as  provided  below.  If the
                  Guarantors  admit in writing that they will be liable
                  to the Purchaser  with respect to the full amount and
                  as to all  material  elements  of a third party claim
                  alleging  damages,  should the third party prevail in
                  such  suit,  the  Guarantors  shall have the right to
                  assume  full  control of the  defense of such  claim.
                  Otherwise,  the  Purchaser  shall have and retain the
                  right to control the  defense of such claim,  and the
                  Guarantors  shall be entitled to  participate  in the
                  defense of such  claim  only with the  consent of the
                  Purchaser.

         (b) The  Purchaser  hereby agrees to indemnify and hold the Company and
the Guarantors,  and each of them,  harmless with respect to any and all claims,
losses,  damages,  obligations,  liabilities  and expenses,  including,  without
limitation,  reasonable legal and other costs and expenses of investigating  and
defending any actions or threatened actions,  which the Company,  the Guarantors
or any of them may incur or suffer following the Closing by reason of any breach
of any of the  representations  and  warranties  of  the  Purchaser  or  Vertica
contained herein,  during the Purchaser's  Warranty Period following the Closing
during  which any such  representation  and warranty  shall  survive as provided
herein,  provided that the Company and the Guarantors  comply with the following
indemnification procedure:

         (i)      One or more of the Company and the  Guarantors  shall
                  give written  notice to the  Purchaser of a claim for
                  indemnification   within  the   Purchaser's  Warranty
                  Period;  which  notice  shall set  forth  the  amount
                  involved in the claim for indemnification and contain
                  a  reasonably  thorough   description  of  the  facts
                  constituting the basis of such claim.

                                 -21-
<PAGE>

                  (ii) The  Purchaser  shall  have a period of thirty  (30) days
         from the  receipt  of the  notice  referred  to above to respond to the
         indemnity  claim  to  the  mutual  satisfaction  of  the  Company,  the
         Guarantors and the Purchaser.

                  (iii) If a third party claim is asserted which might result in
         a claim for  indemnification  hereunder,  all  information  within  the
         Company's or the Guarantors' knowledge or control relevant and material
         to the defense of any such claim shall  promptly be made  available  to
         the Purchaser and their authorized representatives, and the Company and
         the  Guarantors  shall  otherwise  cooperate  with the Purchaser in the
         defense of the claim.  Neither  the Company  nor the  Guarantors  shall
         settle or compromise  any such claim without the prior written  consent
         of the  Purchaser  unless suit shall have been  instituted  against the
         Company or the  Guarantors and the Purchaser  shall have failed,  after
         reasonable  notice of  institution of the suit, to take control of such
         suit as provided  below.  If the  Purchaser  admit in writing that they
         will be liable to the Company and the  Guarantors  with  respect to the
         full  amount and as to all  material  elements  of a third  party claim
         alleging  damages,  should the third  party  prevail in such suit,  the
         Purchaser shall have the right to assume full control of the defense of
         such claim.  Otherwise,  the Guarantors shall have and retain the right
         to  control  the  defense of such  claim,  and the  Purchaser  shall be
         entitled  to  participate  in the  defense  of such claim only with the
         consent of the Guarantors.

                                    ARTICLE 9
                                  MISCELLANEOUS

         9.1 Other  Documents.  Each of the  parties  hereto  shall  execute and
deliver such other and further  documents and  instruments,  and take such other
and  further  actions,  as  may be  reasonably  requested  of him or it for  the
implementation  and consummation of this Agreement and the  transactions  herein
contemplated.

         9.2 Parties in Interest. This Agreement shall be binding upon and inure
to the benefit of the parties hereto, and the heirs,  personal  representatives,
successors  and assigns of all of them,  but shall not confer,  expressly  or by
implication, any rights or remedies upon any other party.

         9.3 Governing  Law. This Agreement is made and shall be governed in all
respects,  including  validity,  interpretation  and effect,  by the laws of the
State of Colorado.

         9.4 Notices. All notices,  requests or demands and other communications
hereunder  must be in  writing  and  shall be  deemed  to have been duly made if
personally delivered or mailed, postage prepaid, to the parties as follows:

         (a)      If to the Company or either of the Guarantors, to:

                  Perfection Development Corporation
                  1422 Delgany Street
                  Denver, Colorado 80202
                  Attention:  Mr. Scott M. Thornock

                                      -22-
<PAGE>

                  With copies to:

                  Patricia Cudd, Esq.
                  Cudd & Associates

                  1120 Lincoln Street, Suite #1310
                  Denver, Colorado 80203

         (b)      If to Vertica or the Purchaser, to:

                  Vertica Software, Inc.
                  5801 Christie Avenue, Suite #240
                  Emeryville, California  94608
                  Attention:  Mr. Hans Nehme, President

                  With copies to:

                  Thomas C. Armstrong, Esq.
                  Venture Counsel Associates, LLP
                  Lake Merritt Plaza Building
                  1999 Harrison Street, Suite #1300
                  Oakland, California  94612

Any party  hereto may change his or its  address by written  notice to the other
parties given in accordance with this Section 9.4.

         9.5 Entire  Agreement.  This Agreement and the exhibits attached hereto
contain the entire  agreement  between and among the parties and  supersede  all
prior agreements,  understandings and writings between or among the parties with
respect to the subject matter hereof and thereof. Each party hereto acknowledges
that  no  representations,   inducements,  promises  or  agreements,  verbal  or
otherwise,  have been made by any party,  or anyone  acting  with  authority  on
behalf of any party,  which are not embodied herein or in an exhibit hereto, and
that no other  agreement,  statement  or promise  may be relied upon or shall be
valid or binding.  Neither  this  Agreement  nor any term hereof may be changed,
waived,  discharged or terminated verbally. This Agreement may be amended or any
term hereof may be changed, waived,  discharged or terminated by an agreement in
writing signed by all parties hereto.

         9.6  No  Equitable  Conversion.  Prior  to  the  Closing,  neither  the
execution of this  Agreement  nor the  performance  of any  provision  contained
herein  shall cause any party  hereto to be or become  liable in any respect for
the operations of the business of any other party,  or the condition of property
owned by any other party, for compliance with any applicable laws,  requirements
or regulations  of, or taxes,  assessments or other charges now or hereafter due
to, any governmental  authority or for any other charges or expenses  whatsoever
pertaining to the conduct of the business or the ownership,  title,  possession,
use or occupancy of any other party.

         9.7 Headings. The captions and headings used herein are for convenience
only and shall not be construed as part of this Agreement.

         9.8 Attorneys'  Fees. In the event of any  litigation  between or among
the parties hereto, the non-prevailing party or parties shall pay the reasonable
expenses,  including but not limited to the  attorneys'  fees, of the prevailing
party or parties in connection therewith.

         9.9 Counterparts.  This Agreement may be executed in counterparts, each
of which  shall be deemed an  original  but all of which  taken  together  shall
constitute but one and the same document.

                                      -23-
<PAGE>

<TABLE>
         IN WITNESS THEREOF, the parties hereto have duly executed and delivered
this Agreement as of the day and year first above written.
<CAPTION>
THE COMPANY:

<S>                                                  <C>
ATTEST:                                              PERFECTION  DEVELOPMENT   CORPORATION

By:___________________________________               By:_____________________________________
      C. Edward Venerable, Secretary                         Scott M. Thornock, President

THE GUARANTORS:

______________________________________               ________________________________________
      C. Edward Venerable, Individually                      Scott M. Thornock, Individually

THE PURCHASER:

______________________________________
      Hans Nehme, Individually

VERTICA:

ATTEST:                                              VERTICA SOFTWARE, INC.

By: __________________________________               By: ________________________________
                               (Title)                       Hans Nehme, President

</TABLE>
                                      -24-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00002-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00002-of-00352.parquet"}]]