10KSB

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549
                             ----------------------
                                   FORM 10-KSB

                  Annual Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

                   For the Fiscal Year Ended December 31, 2000
                         Commission File Number: 1-15169

                                PERFICIENT, INC.
                 (Name of Small Business Issuer in its Charter)

                     DELAWARE                               74-2853258
         (State or Other Jurisdiction of                  (IRS Employer
          Incorporation or Organization)                Identification No.)

                 7600B North Capital of Texas Highway, Suite 340
                               Austin, Texas 78731
                    (Address of principal executive offices)

                                 (512) 531-6000
              (Registrant's telephone number, including area code)

      Securities registered pursuant to Section 12(b) of the Exchange Act:

      Title of Class                  Name of each exchange on which registered:
      Common Stock, $.001 par value   Boston Stock Exchange

           Securities registered pursuant to Section 12(g) of the Act:

                                      NONE
                                (Title of Class)

Check whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such reports)
and (2) has been subject to such filing requirements for the past 90 days:

(1)   Yes |X| No |_|
(2)   Yes |X| No |_|

Check if disclosure of delinquent filers in response to Item 405 of Regulations
S-B is not contained in this filing, and no disclosure will be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB.|_|

State Registrant's revenues for its most recent fiscal year $19,963,759

State the aggregate market value of the voting stock held by non-affiliates
computed by reference to the price at which the common equity was sold, or the
average bid and asked prices of such common equity as of a specified date within
the past 60 days.

                        $30,089,353 AS OF MARCH 23, 2001

Number of shares of common stock outstanding as of March 23, 2001: 6,252,233

Transitional Small Business Disclosure Format: Yes |_| No |X|

                       DOCUMENTS INCORPORATED BY REFERENCE

      Parts of the Proxy Statement for Registrant's 2001 Annual Meeting of
Stockholders to be held June 14, 2001 which will be filed prior to April 30,
2001, are incorporated by reference in Part III of this Form 10-KSB Report


                                PERFICIENT, INC.
                            FORM 10-KSB ANNUAL REPORT
                      FOR THE YEAR ENDED DECEMBER 31, 2000

                                TABLE OF CONTENTS

Part I
      Item    1.  Business.....................................................1
      Item    2.  Description of Property.....................................16
      Item    3.  Legal Proceedings...........................................16
      Item    4.  Submission of Matters to a Vote of Security Holders.........16
      Item    4a. Executive Officers..........................................17

Part II
      Item    5.  Market for Registrant's Common Equity and Related
                  Stockholder Matters.........................................19
      Item    6.  Management's Discussion and Analysis of Financial
                  Condition and Results of Operations.........................20
      Item    7.  Consolidated Financial Statements and Supplementary Data....25
      Item    8.  Changes in Disagreements with Accountants on
                  Accounting and Financial Disclosures........................25

Part III
      Item    9.  Directors and Executive Officers of the Registrant..........25
      Item   10.  Executive Compensation......................................26
      Item   11.  Security Ownership of Certain Beneficial Owners and
                  Management..................................................26
      Item   12.  Certain Relationships and Related Transactions..............26

Part IV
      Item   13.  Exhibits, Financial Statement Schedules and
                  Reports on Form 8-K.........................................26

SIGNATURES....................................................................28


                                       i


                                     PART I

ITEM 1. BUSINESS

      The statements contained in this Report on Form 10-KSB and in the Annual
Report that are not purely historical statements are forward looking statements
within the meaning of Section 21E of the Securities and Exchange Act of 1934,
including statements regarding our expectations, beliefs, hopes, intentions or
strategies regarding the future. These forward-looking statements include ,among
other things, references to the market potential for Internet implementation,
our competitive advantage over systems integrators and technology professionals,
potential for demand for our services, and the benefits and advantages of our
business model, and involve substantial risks and uncertainties. Actual results
may differ materially from those indicated in such forward-looking statements.
Please see "Risk Factors," "Special Cautionary Note Regarding Forward-Looking
Statements" and the factors and risks discussed in other reports filed from time
to time with the Securities and Exchange Commission.

Overview

      Perficient is a software services firm that uses leading and emerging
technologies to web-enable complex enterprise systems. We build deep expertise
around a targeted set of core technologies and products through unique
outsourcing partnerships with leading Internet software companies. Under these
arrangements we provide customers and partners with teams of expert technology
professionals that manage the implementation of their products for end-user
customers. Our expertise and experience is based on our success integrating
next-generation solutions with customers' previous-generation information
technology (IT) assets. This provides the framework that allows Perficient to
concentrate on three key solution segments: Web application servers, enterprise
portal software and content management services.

      Our business is structured around two relationship models, each based on
providing dedicated teams of technology experts:

o     Virtual Services Organization (VSO). A team of Perficient IT professionals
      dedicated to a specific software company partner, which performs the
      deployments on behalf of the partner. The VSO model allows us to leverage
      our partners' sales channels and market presence, providing us a
      predictable and cost-effective method for sourcing new service
      engagements. This enables our partners to focus on their core business of
      developing and marketing software so that they need not make as
      significant a capital and management investment necessary to build and
      properly manage an internal professional services organization.

o     Direct. Our expertise in specific practice areas is used to manage
      implementation work through direct relationships with end-customers.
      Customer leads are generated by our sales and marketing organization as
      well as through recommendations from partners and customers.

      To date, we have completed over 500 services engagements for more than 200
end-user customers. We currently employ approximately 150 technology
professionals, in five offices in the United States, Canada and the United
Kingdom.

      We recently signed an outsourcing agreement with IBM Corporation under
which we may provide up to $73.5 Million in services over the next three years,
including deployment, integration and training services for IBM's WebSphere(TM)
customers, although IBM may terminate this agreement on four month's notice. In
addition, we have previously entered into VSO agreements with Vignette
Corporation, Calico Commerce Inc., and Plumtree Software, Inc.

Industry Overview

      In the early stages of commercial use of the Internet, companies viewed
the Internet primarily as a



means of advertising their business. Accordingly, many established a web
presence consisting primarily of static promotional web pages. In order to
develop and deploy these relatively simple front-end web projects, these
companies used internal technology personnel or hired online advertising
agencies and web design firms.

      In the late 1990s, as web usage grew, companies sought to more fully
harness the potential of the Internet to transform and enhance additional
business initiatives, such as building on-line relationships with customers,
suppliers and business partners, creating new revenue opportunities, improving
operating efficiencies and improving internal and external communications. They
have determined that critical business information needed for these business
initiatives is primarily contained within their pre-existing applications,
commonly referred to as legacy applications, that were not designed to be used
with the Internet. In order to successfully align their business and e-commerce
strategies, companies increasingly needed to find a way to integrate their
back-end legacy applications with their more sophisticated Internet projects.

      In response to these dynamics, software companies began to offer packaged
software applications and middleware software platforms for enabling e-commerce
initiatives and integrating them with back-end systems. Packaged software is a
pre-built application designed to automate key business functions such as
transaction processing or to enable new functionality such as content
management. Middleware platforms function as a messaging layer, either enabling
legacy applications to effectively communicate with web-based packaged
applications or assisting users to create their own custom developed business
applications. These new Internet software applications utilize enabling
technologies such as JAVA and XML to facilitate the integration of disparate
platforms, applications and data sources necessary to web-enable enterprise
systems. By using either packaged or custom developed software applications and
middleware software platforms, organizations can create sophisticated web-based
e-commerce applications which are completely integrated with their existing
business processes and legacy systems.

      Substantial customization is required to integrate Internet software with
each business user's own unique business processes, infrastructure and system
requirements. Due to the complexity and strategic importance of these projects,
there is increasing demand for Internet and implementation services to integrate
legacy, back-end systems to web sites. International Data Corporation projects
that the demand for Internet implementation services in the United States will
grow from $6.3 billion in 1999 to $29.9 billion in 2004, representing a compound
annual growth rate of approximately 36.3%. These Internet implementation
services include project management, configuration services, custom software
development, staging and prototyping, installation and migration services.

      To address Internet implementation requirements, software companies and
their end-user customers have the following options:

      o     in-house professional services organizations;

      o     small or regional systems integrators; and

      o     large consulting firms.

      These options present a variety of problems. For Internet software
companies, recruiting, retaining, educating, training and managing an in-house
staff of qualified technology professionals requires significant capital and
management attention. In addition, demand fluctuations and the lack of
experience and scale, may result in inefficient utilization of these internal
service organizations, thereby adversely affecting operating results. The
significant costs and resource requirements diminish resource availability for
core areas of their businesses, such as research and development and additional
marketing efforts for their products.

      Small or regional systems integrators that may possess extensive expertise
with select technologies, often lack the necessary scale to ensure a
cost-effective, sustainable services delivery capability for national or
international end-users. Finally, large consulting firms focus primarily on
long, multi-faceted


                                       2


engagements that include strategic consulting, technology and infrastructure
design as well as the implementation of multiple technology vendors. These firms
typically concentrate their efforts on developing long-term, end-user
relationships, rather than rapid implementations for specific software
applications.

Our Solution

      We believe the growing market for Internet software, the increased
complexity and shorter product cycles associated with these applications,
coupled with the limitations of existing alternatives, create a significant
market opportunity for our services. We believe that as Internet software
companies compete for market share, they will look to establish relationships
with solutions integration partners that have specific expertise in their
applications. We believe our VSO model offers our partners and their end-user
customers the following advantages, that give us a competitive edge over systems
integrators and technology consultants:

      Deep Technology Expertise. We develop technology expertise around a
targeted set of core Internet and legacy products and technologies through
focused VSO partnerships with leading Internet software companies. Leveraging
our technology expertise, our consultants can rapidly and successfully integrate
our partners' products and efficiently satisfy the specific needs of end-users.
In addition, we assist partners' engineering and development teams with certain
aspects of new product development as well as provide training and education
services for their internal services organizations and third-party service
providers.

      Aligned Incentives. Our VSO model utilizes small dedicated teams of
professionals focused exclusively on rapid implementations. We do not seek to
extend our service engagements by cross-selling products or services once an
engagement has been commenced. By improving the time-to-value for end-users, we
may increase the number of referenceable customers for our partners, which helps
to drive market acceptance of their products. Therefore, our model creates a
synergistic relationship, helping drive market penetration of our partners'
products and, in turn, motivates our partners to generate demand for our
services.

      Focus on Core Business/Reduced Costs. By leveraging our technology
experts, our partners can focus on their core business of researching,
developing and marketing software applications without the investment and
diversion of management and capital resources necessary to properly manage a
professional services organization. In addition, for end-user customers, shorter
implementation times reduce their costs and risks associated with Internet
software projects.

Our Strategy

      Our objective is to be the leading technology expert for Internet software
companies and their most demanding customers. To achieve this objective, our
strategy is to:

      Establish a Portfolio of VSO Partnerships with Leading Internet Software
Companies. We target high-growth, services-rich segments of the Internet
software market. In establishing VSO relationships, we seek to leverage our core
technology expertise in delivering implementation services and expanding our
existing partnership relations. Since we focus on identifying both established
and emerging leaders, we believe that developing a diversified portfolio of
virtual services organizations will enhance our competitive position, diminish
the impact of a downturn in demand for any one partner's product and position us
to benefit from the overall growth in the Internet software services market.

      Deliver Rapid Successful Implementations. We deploy small teams of
technology experts who leverage their focused experience and, using pre-built
XML and JavaBeans(TM) -- based components, significantly reduce the time
required to develop custom software applications that implement our partners'
products.

      Focus on Core Technologies. We attempt to attract new partners whose
products are based upon core Internet technologies such as Java II Enterprise
Edition (J2EE) and XML technologies. We have invested and expect to continue to
invest significant resources to expand upon our technology expertise. We believe
that by focusing on core technologies, we can:


                                       3


      o     leverage the shared experiences of our consultants,

      o     rapidly assemble partner teams,

      o     manage fluctuations in services demand for our partners' products,
            and

      o     leverage infrastructure investments in training and personnel
            development.

      Leverage our Partners' Sales Channels. We seek to leverage the existing
sales channels of our partners by working closely with their sales, marketing
and development departments to monitor and improve demand for their products. We
believe that our VSO model provides a cost-effective method for sourcing our
services engagements, resulting in lower fixed costs and enhanced operating
leverage. While we market our services to customers, our VSO relationships also
frequently generate lead flow such that we help our partner close business or
deal with difficult implementations when resources and expertise are critically
in short supply.

      Recruit and Retain Highly-Skilled Professionals. We believe that our
ability to recruit and retain highly skilled professionals is a critical factor
for our continued success. We maintain a corporate culture that fosters
expertise, continuing professional development, rapid advancement and teamwork,
providing our consultants with the opportunity to become experts in leading
Internet technologies.

      Build Scale through Internal Growth and Selective Acquisitions. In order
to serve the future demands of our partners and potential partners, we intend to
continue to expand technological expertise and geographical presence as well as
to improve operating efficiencies in the delivery of our services through
internal growth and through selective acquisitions. In order to further expand
our internal growth, we intend to capitalize on specific areas of our technology
expertise to pursue strategic alliances with national and global consulting
firms.

Our Services

      We web-enable enterprise systems using our partners' technologies. Our
dedicated teams manage and execute the installation and implementation of our
software partners' software solutions. For our project engagements, we perform
any or all of the following services:

      o     analyze end-user customer goals and requirements;

      o     define the scope of the implementation project;

      o     design a project plan; and

      o     custom develop solutions as well as install, configure, and
            integrate our partners' Internet software products.

      Our goal is to reduce significantly the time required to implement our
partners' products. This enables end-user customers to quickly realize the
benefits associated with our partners' software products and our partners to
more rapidly expand their market share. To accomplish this goal, we have
established a JumpStart(TM) offering that can significantly reduce
implementation timeframes. JumpStart(TM) is an example of our applications
development framework, which leverages pre-built enterprise JavaBeans(TM) and
XML based components developed by us, as well as our shared services expertise
and our proven delivery methodology. By deploying small teams of technology
experts, usually three to eight professionals, who utilize this framework, we
can significantly reduce implementation timeframes and obtain repeatable
results.

      The following examples help illustrate the scope of the services that we
have provided using software from our partners.


                                       4


      Hewlett Packard is one of the leading manufacturers of hardware and
software solutions in the world. With hundreds of thousands of end users of
Hewlett Packard (HP) products and technologies, HP has a tremendous amount of
information that it must make available to both the general public as well as
corporate clients. HP required a content management solution that would let it
disseminate information to end users from their disparate back end legacy
systems in the most efficient manner. HP chose Vignette's Story Server platform,
a major undertaking for HP in the Enterprise Web arena. Faced with the challenge
and uncertainty of planning and implementing this program, HP retained
Perficient to architect and engineer their entire solution. The project called
for a level of technical expertise in several key areas, including systems
design (hardware, software, networking), training (on Story Server development
and administration), customization of processes, as well as the phased
implementation processes required to ensure flawless deployments to their "live"
production site.

      MCI WorldCom, with operations in more than 65 countries, is a premier
provider of facilities-based and fully integrated local, long distance,
international and Internet services. For MCI WorldCom, Perficient implemented an
IBM WebSphere-based solution for multiple Web sites. These sites were designed
to leverage enterprise JavaBeans and Java Servlets to allow flexibility and
ease-of-use in harnessing multiple sources of data from all parts of MCI
WorldCom's business domain. The ease-of-use and flexibility of Visual Age for
Java and WebSphere provided the developers with the tools to quickly make
changes and adapt to new site requirements on the fly. Perficient helped reduce
the delivery cycle for a typical site from over three months to six to eight
weeks. All sites developed are 24X7 production sites aimed at more than 25,000
MCI WorldCom employees, including their entire worldwide sales force. Perficient
has been involved in multiple development efforts at MCI WorldCom for more than
two years.

      SBC Communications Inc., through its subsidiaries, Southwestern Bell,
Ameritech, Pacific Bell, SBC Telecom, Nevada Bell, SNET and Cellular One, SBC
provides local and long-distance phone service, wireless and data
communications, paging, high-speed Internet access and messaging, cable and
satellite television, security services and telecommunications equipment, as
well as directory advertising and publishing. SBC sought to improve customer
service and reduce costs by enabling customers of all of its United States
holding companies to manage their telecommunications service options (such as
three-way calling, call forwarding and caller ID) over the web. SBC was faced
with the burden of developing a method for numerous divergent company systems
using distinct hardware and software to have access to a common processing
center. Using Vignette's StoryServer(TM) for personalization and management and
IBM's WebSphere(TM) products for legacy integration, we developed a system that
supports the provisioning needs for over 60 million access lines that currently
processes over 30,000 orders per week.

Our Partners

      We target value-added, service-rich segments of the Internet software
market including Internet Relationship Management and personalization with
Vignette, corporate portals with Plumtree Software and enabling "middleware"
platforms with IBM.

      In October 2000, we entered into a new services agreements with IBM under
which we will provide deployment, integration and training services to IBM's
WebSphere(TM) customers. The agreement provides for us to render services over a
three-year period not to exceed $73.5 million in total value. Under the
agreement with IBM, we are paid for services rendered, subject to a guaranteed
minimum utilization by IBM of a specified number of hours per consultant per
year. The agreement may be terminated at any time by IBM on four month's notice.

Technology Leadership Council

      Our technology leadership council, led by our chief technology officer and
including the heads of each of our business development and emerging practice
groups, performs a critical role in maintaining our technology leadership.
Assisted by a technology team consisting of key members from each of our
practice areas, the council frames our new partner strategies, conducts regular
conferences on the Internet with our


                                       5


technology professionals on specific partner and general technology issues and
trends, conducts promotional activities, such as white paper publication and
speaking engagements by our professionals, identifies services opportunities
between and among our partners' products, oversees our quality assurance
programs and assists in acquisition-related technology due diligence.

Sales and Marketing

      We source most of our services engagements through our partners. As a
result, our principal sales and marketing activity consists of establishing VSO
relationships with Internet software companies and continuing to market our
services with our partners' organizations after a relationship is established.
We have a business development group that works with our technology leadership
council to identify partner prospects and to engage those partners to develop a
VSO partnership. We also market our services by establishing informal
relationships with venture capital firms, and other service providers that work
with emerging Internet software companies. These relationships help us identify
and form partner relationships with emerging companies. Once a partnership is
established, a managing director is responsible for coordinating projects and
stimulating additional demand from that partner.

      In addition to generating leads from our partners, we may also enter into
services engagements directly with end-users. Our direct sales staff consists of
five full-time professionals. We regularly receive referrals from our software
vendor partners, end-users for which we have previously performed services and
as a result of our education and training services. Our VSO relationships
frequently generate lead flow such that we help our partners close business or
resolve difficult implementations.

Technology Professionals

      Recruiting. Our most valuable assets are our technology professionals. We
are dedicated to hiring, developing and retaining technology professionals who
combine a depth of understanding of current Internet and legacy technologies
with the ability to implement our partners' complex solutions for their
end-users.

      Our recruiting efforts are an important element of our growth. We
generally target technology professionals with extensive experience and
demonstrated expertise. After initially identifying qualified candidates, we
conduct an extensive screening process.

      To attract technology professionals, we use a broad range of sources
including internal referrals, other technology companies and technical
associations, the Internet and advertising in technical periodicals.

      We believe that our focus on a target set of core Internet technologies
and our commitment to continuing training and advancement opportunities makes us
an attractive career choice for experienced professionals. Because our partners
are current and emerging market leaders, our technology professionals have an
opportunity to work with cutting-edge information technology. We foster
professional development by training our technology professionals in the skills
critical to successful consulting engagements such as implementation methodology
and project management.

      Training. To ensure continued development of our technical staff, we place
a high priority on training. We offer extensive training for our professionals
around industry-leading technologies. We recently implemented an intensive
three-week Java immersion "boot camp" for our newly hired technology
professionals and a modified, refresher program for our existing professionals.
Boot camp curriculum includes J2EE and JSP modules and offers integration
strategies and technologies among our partners' products and technologies. In
addition, we have established an on-line, Internet-based education and training
program that offers over 200 topics, including CORBA, EJB architecture, HTML,
J2EE, Linux, Network Security and XML fundamentals. This web-based education
system is offered to all of our technology professionals to facilitate their
ongoing professional development and increase their technical expertise.

      The Perficient Staffing Model. In contrast to the traditional staffing
model that results in large numbers


                                       6


of new recruits being overseen by a few experienced people, we utilize an
"expert" model, in which small numbers of recruits gain experience and learn
with a cadre of experienced technology professionals. Our focus on seasoned
professionals allows us to deliver our solutions with speed and quality while
developing high level skills in our partners' technologies.

      The Perficient Promise. We continue to build our corporate culture around
a common set of values based on expertise, honesty and teamwork. We hold
semi-annual, off-site company meetings to foster training, teamwork and the
Perficient culture.

      We have codified our commitments to each other in The Perficient Promise,
which consist of the following seven simple commitments our management and
technology professionals make to each other:

      o     We work with cutting-edge technologies and leading-edge clients;

      o     We maintain an informal team culture;

      o     We provide our technology professionals with high-quality
            infrastructure support services;

      o     We offer rapid advancement opportunities;

      o     We provide competitive incentives including equity ownership;

      o     We reinvest in continuing training and education; and

      o     We treat each other with respect.

      We take these commitments extremely seriously, because we believe that we
can succeed only if The Perficient Promise is kept.

      MyPerficient.com -- The Corporate Portal. Our technology professionals are
mobile. To ensure ubiquitous access to a wide range of information and tools, we
have created a corporate portal, MyPerficient.com. It is a secure, centralized
communication tool implemented using Plumtree Software's Corporate Portal
product. It allows each technology professional unlimited access to the
information, productivity tools, time and expense entry, benefits administration
and quality management information directories and documentation.

Employees

      As of March 23, 2001, we employed approximately 182 full-time employees.
Of our total employees, 150 were technology professionals and 32 were involved
in sales, general administration and marketing. Our employees are not
represented by any collective bargaining unit, and we have never experienced a
work stoppage.

Competition

      We compete in the Internet professional services market, which is
relatively new and intensely competitive. We expect competition to intensify as
the market further develops and evolves. We believe that our competitors fall
into several categories, including:

      o     In-house information technology and professional services and
            support departments of software companies;

      o     Systems integrators, such as Cambridge Technology Partners, Cysive
            Inc., marchFIRST, Proxicom, Inc., Sapient Corporation, Scient
            Corporation, Cbridge and Viant Corporation;

      o     Large consulting firms, such as Accenture and the consulting arms of
            the large accounting firms; and


                                       7


      o     Information technology staffing firms, such as Keane, Inc. and
            Renaissance Worldwide.

      We believe that the principal competitive factors affecting our market,
and on which we focus our efforts, include experience of personnel, number of
customers, the breadth and depth of a given solution, service quality and
performance, core technologies, product scalability, reliability and product
features and the ability to implement solutions quickly and respond timely to
customer needs. In addition, there are relatively low barriers to entry into
this market and we expect to face additional competition from new entrants.

      Most of our competitors have longer operating histories, larger client
bases, greater name recognition and possess significantly greater financial,
technical and marketing resources than we do. As a result, our competitors may
better be able to attract Internet software companies to which we market our
services and adapt more quickly to new technologies or evolving customer or
industry requirements. Many competitive factors are outside of our control, such
as the ability of our competitors to hire, retain and motivate qualified
technology professionals.


                                       8


                                  RISK FACTORS

      An investment in our common stock involves a high degree of risk.
Additional risks and uncertainties, including those generally affecting the
market in which we operate or that we currently deem immaterial, may also
significantly impair our business.

Risks Specific to Our Business

We have lost money during most of the quarters during which we have been in
business and we expect to lose money in the future.

      We have incurred operating losses in most of the quarters during which we
have been in business and as a result, we have a retained deficit of $15,004,000
as of December 31, 2000. As a result of the acquisitions that we recently
completed, we recorded a substantial amount of goodwill. We will be required to
amortize in excess of $4,800,000 in goodwill per quarter over the next three
years. We cannot assure you of any operating results. In future quarters, our
operating results may not meet public market analysts' and investors'
expectations. If that happens, the price of our common stock will likely fall.

      We plan to continue to increase our expenditures on infrastructure
development, personnel, marketing and business development and general and
administrative expenses in connection with our efforts to expand our business.
As a result, we will need to generate significant revenues to achieve
profitability. Even if we achieve profitability, we may not be able to sustain
or increase profitability on a quarterly or annual basis in the future. Although
our revenues have grown in recent quarters, you should not view our historical
growth rates as indicative of our future revenues.

We have a limited number of partners. The loss of sales to IBM, Vignette, or
Plumtree would materially harm our business.

      We have arrangements with a limited number of partners. IBM, Vignette, and
Plumtree accounted, on a pro forma basis, for 25%,26%, and 8% respectively, of
our revenue during the year ended December 31, 2000. Any termination of our
relationship with, or significant reduction or modification of the services we
perform for, IBM, Vignette or Plumtree would have a material adverse effect on
our business, operating results and financial condition. Each partner retains
our services only on a case-by-case basis and may choose at any time to use any
other firm or to provide the services that we perform for them. Therefore, any
downturn in the business of one or more of our partners or any shift in their
decisions to continue to use our services could also substantially reduce our
revenues.

IBM may terminate its agreement with us or reduce substantially its obligations
to use our services.

      IBM has the right to reduce by up to one-third the minimum amount of our
services contemplated by our agreement over any 60-day period. In addition, IBM
may terminate the agreement on four month's notice. Any termination of our
agreement with IBM or a reduction of the services performed pursuant to this
agreement would have an adverse effect on our business, operating results and
financial condition.

Our partners may not be obligated to use our services.

      Our contracts with some of our partners do not obligate them to use our
services. A partner may choose at any time to use another consulting firm or to
perform the services we provide through an internal services organization.
Termination of a relationship with certain partners, or such partner's decision
to employ other consulting firms or perform services in-house, could materially
harm our business.

Our quarterly operating results will be volatile and may cause our stock price
to fluctuate.

      A high percentage of our operating expenses, particularly personnel and
rent, are fixed in advance of any particular quarter. As a result, if we
experience unanticipated changes in our projects or in our employee utilization
rates, we could experience large variations in quarterly operating results and
losses in


                                       9


any particular quarter. Due to these factors, we believe you should not compare
our quarter-to-quarter operating results to predict our future performance.

      Our quarterly revenue, expenses and operating results have varied
significantly in the past and are likely to vary significantly in the future.
These quarterly fluctuations have been and will continue to be affected by a
number of factors, including:

      o     The loss of a significant partner or project;

      o     The number and types of projects that we undertake;

      o     Our ability to attract, train and retain skilled management and
            technology professionals;

      o     Seasonal variations in spending patterns;

      o     Our employee utilization rates, including our ability to transition
            our technology professionals from one project to another;

      o     Changes in our pricing policies;

      o     Our ability to manage costs; and

      o     Costs related to acquisitions of other businesses.

      In addition, many factors affecting our operating results are outside of
our control, such as:

      o     Demand for Internet software;

      o     End-user customer budget cycles;

      o     Changes in end-user customers' desire for our partners' products and
            our services;

      o     Pricing changes in our industry;

      o     Government regulation and legal developments regarding the use of
            the Internet; and

      o     General economic conditions.

      Although we have limited historical financial data, we expect that we will
experience seasonal fluctuations in revenues. We expect that revenues in the
quarter ending December 31 will typically be lower than in other quarters
because there are fewer billable days in this quarter as a result of vacations
and holidays. This seasonal trend may materially affect our quarter-to-quarter
operating results.

We may not be able to attract and retain technology professionals, which could
affect our ability to compete effectively.

      Our business is labor intensive. Accordingly, our success depends in large
part upon our ability to attract, train, retain, motivate, manage and utilize
highly skilled technology professionals. Because of the recent rapid growth of
the Internet and shortage of qualified Internet professional services personnel,
competition for individuals who can perform the services we offer is intense and
such individuals are likely to remain an expensive limited resource for the
foreseeable future. Furthermore, there is a high rate of attrition among such
personnel. This high turnover rate results in additional training expense, which
in turn decreases our profitability. Additionally, our technology professionals
are at-will employees with no restrictions on their ability to work for our
competitors. Any inability to attract, train and retain highly skilled
technology professionals would impair our ability to adequately manage, staff
and utilize our existing projects and to bid for or obtain new projects, which
in turn would adversely affect our operating


                                       10


results.

We may align ourselves with partners that fail.

      In selecting our partners, we seek to identify leading Internet software
companies or companies that we believe will develop into leaders in their
respective markets. However, our partners compete in new and rapidly changing
markets. In certain of these markets, only a few companies will survive. If we
align ourselves with companies that fail to become market leaders or whose
products become obsolete, our business may suffer because our partners will not
have significant demand for our services. We invest substantial resources to
train our technology professionals regarding the use and features of our
partners' software, and we will lose this investment if our partners fail.

We have agreed not to perform services for competitors of our partners, which
limits our potential market penetration.

      We have agreed with certain of our partners not to perform services for
their competitors. These non-compete agreements substantially reduce the number
of our prospective partners. In addition, these agreements increase the
importance of our partner selection process, because many of our partners
compete in markets where only a limited number of companies gain significant
market share. If we agree not to perform services for a particular partner's
competitors and our partner fails to gain meaningful market share, our potential
revenues in that particular market will be limited.

Our limited operating history makes evaluating our business difficult.

      We began our business in September 1997. We only began providing services
on any significant basis in mid-1998. As a result, we have a limited operating
history upon which you may evaluate our business and prospects. Companies in an
early stage of development frequently encounter greater risks and unexpected
expenses and difficulties.

      These risks are further amplified by the fact that we are operating in the
new and rapidly evolving Internet services market. These risks and uncertainties
include the following:

      o     our business model and strategy have evolved and are continually
            being renewed;

      o     we may not be able to successfully implement our business model and
            strategy; and

      o     our management has not worked together for very long.

Our gross margins are subject to fluctuations as a result of variances in
utilization rates.

      Our gross margins are affected by trends in the utilization rate of our
professionals, defined as the percentage of: our professionals' time billed to
customers divided by the total available hours in a period. Our operating
expenses, including employee salaries, rent and administrative expenses are
relatively fixed and cannot be reduced on short notice to compensate for
unanticipated variations in the number or size of projects in process. If a
project ends earlier than scheduled, or, as has been the case, we retain
professionals in advance of receiving project assignments; we may need to
redeploy our project personnel. Any resulting non-billable time may adversely
affect our gross margins. The absence of long-term contracts and the need for
new partners and business create an uncertain revenue stream, which could
negatively affect our financial condition.

Our success will depend on retaining our senior management team and key
technical personnel.

      We believe that our success will depend on retaining our senior management
team, key technical personnel and our Chief Executive Officer, John T. McDonald.
This dependence is particularly important in our business, because personal
relationships are a critical element of obtaining and maintaining our partners.
If any of these people stop working for us, our level of management, technical,
marketing and


                                       11


sales expertise could significantly diminish. These people would be difficult to
replace, and losing them could seriously harm our business.

      We may not be able to prevent key personnel, who may leave our employ in
the future, from disclosing or using our technical knowledge, practices or
procedures. One or more of our key personnel may resign and join a competitor or
form a competing company. As a result, we might lose existing or potential
clients.

We may not grow, or we may be unable to manage our growth.

      Our success will depend on our ability to increase the number of our
partners and our teams of technology professionals. However, we may not grow as
planned or at all. Many of our competitors have longer operating histories, more
established reputations and potential partner relationships and greater
financial, technical and marketing resources than we do. If we do not experience
sustained growth, this would place us at a disadvantage relative to our
competitors. From December 31, 1999 to the present time, the number of
technology professionals that we employ increased from 43 to approximately 150.
However, if we continue to grow, our growth will place significant strains on
our management, personnel and other resources. For example, it will be difficult
to manage technology professionals who will be widely dispersed around the
country. Additionally, our success may depend on the effective integration of
acquired businesses. This integration, even if successful, may be expensive and
time-consuming and could strain our resources. If we are unable to manage our
growth effectively, this inability will adversely affect the quality of our
services and our ability to retain key personnel, and could materially harm our
business.

Our operations in Europe expose us to certain risks related to international
operations.

      In 1999, we opened an office in London. During the year ended December 31,
2000, on a pro forma basis, our revenues relating to our London operations have
accounted for 7% of our revenues and we anticipate that foreign sales may
account for a significant portion of our revenues in the foreseeable future.
Risks inherent in our international business activities include the fluctuation
of currency exchange rates, recessions in foreign economies, political and
economic instability, reductions in business activity during the summer months
in Europe, various and changing regulatory requirements, increased sales and
marketing expenses, difficulty in staffing and managing foreign operations,
potentially adverse taxes, complex foreign laws and treaties and the possibility
of difficulty in accounts receivable collections. Further, we have only minimal
experience in managing international offices and only limited experience in
marketing services to international clients. Revenues from our international
offices may prove inadequate to cover the expenses of such offices and marketing
to international clients. There can be no assurance that any of these factors
will not have a material adverse effect on our business, financial condition and
results of operations.

We face risks associated with finding and integrating acquisitions.

      We have made three acquisitions in the last year and we may continue to
expand our technological expertise and geographical presence through selective
acquisitions. Any acquisitions or investments we make in the future will involve
risks. We may not be able to make acquisitions or investments on commercially
acceptable terms. If we do buy a company, we could have difficulty retaining and
assimilating that company's personnel. In addition, we could have difficulty
assimilating acquired products, services or technologies into our operations and
retaining the customers of that company. Our operating results may be adversely
affected from increased goodwill amortization, stock compensation expense and
increased compensation expense attributable to newly hired employees.
Furthermore, our management's attention may be diverted from other aspects of
our business and our reputation may be harmed if an acquired company performs
poorly. These difficulties could disrupt our ongoing business, distract our
management and employees, increase our expenses and materially and adversely
affect our results of operations. Furthermore, we may incur debt or issue equity
securities to pay for any future acquisitions. If we issue equity securities,
your ownership share of us could be reduced.

Risks Relating to Our Industry


                                       12


We focus solely on companies in the market for Internet software and could be
harmed by any downturn in this industry.

      Our business is dependent upon continued growth in the use of the Internet
to fuel demand for the Internet software applications sold by our partners and
prospective partners. If use of the Internet does not continue to grow, or grows
more slowly than expected, our growth would decline and our business would be
seriously harmed. Any downturn in the market for Internet software would harm
our business, financial condition and operating results. The Internet market has
recently been subject to declines in demand that have resulted in reduced demand
for our services.

      Further, the market for Internet services is relatively new and is
evolving rapidly. Our future growth is dependent upon our ability to provide
strategic Internet services that are accepted by our existing and future
partners and end-user customers as an integral part of their business model.
Demand and market acceptance for recently introduced services are subject to a
high level of uncertainty. The level of demand and acceptance of strategic
Internet services is dependent upon a number of factors, including:

      o     the growth in consumer access to and acceptance of new interactive
            technologies such as the Internet;

      o     companies adopting Internet-based business models; and

      o     the development of technologies that facilitate two-way
            communication between companies and targeted audiences.

      Significant issues concerning the commercial use of these technologies
include security, reliability, cost, ease of use and quality of service. These
issues remain unresolved and may inhibit the growth of Internet business
solutions that utilize these technologies.

Our business will suffer if we do not keep up with rapid technological change,
evolving industry standards or changing partner requirements.

      Rapidly changing technology, evolving industry standards and changing
partner needs are common in the Internet professional services market.
Accordingly, our success will depend, in part, on our ability to:

      o     continue to develop our technology expertise;

      o     enhance our current services;

      o     develop new services that meet changing partner and end-user
            customer needs;

      o     advertise and market our services; and

      o     influence and respond to emerging industry standards and other
            technological changes.

      We must accomplish all of these tasks in a timely and cost-effective
manner. We might not succeed in effectively doing any of these tasks, and our
failure to succeed could have a material and adverse effect on our business,
financial condition or results of operations.

      We may also incur substantial costs to keep up with changes surrounding
the Internet. Unresolved critical issues concerning the commercial use and
government regulation of the Internet include the following:

      o     security;

      o     cost and ease of Internet access;

      o     intellectual property ownership;


                                       13


      o     privacy;

      o     taxation; and

      o     liability issues.

      Any costs we incur because of these factors could materially and adversely
affect our business, financial condition and results of operations.

Our market is highly competitive and has low barriers to entry.

      The market for services to Internet software companies is relatively new,
intensely competitive, rapidly evolving and subject to rapid technological
change. In addition, there are relatively low barriers to entry into this
market. Because of the rapid changes to, and volatility in, the Internet
software and service industry, many well-capitalized companies that may have
chosen sectors of the industry that are not competitive with our business
including our partners, may refocus their activities and resources. As a result,
they could deploy their resources and enter a business that is competitive with
ours. In addition, with consolidation in the Internet software and service
industry, many software developers that may have become our partners could
acquire or develop the capabilities of performing our services for themselves or
merge with our competitors.

      Our current competitors include:

      o     In-house information technology and professional services and
            support departments of software companies;

      o     Systems integrators, such as Cambridge Technology Partners, Cysive
            Inc., marchFIRST, Proxicom, Inc., Sapient Corporation, Scient
            Corporation, CBridge, Viant Corporation;

      o     Large consulting firms, such as Accenture and the consulting arms of
            the large accounting firms; and

      o     Information technology staffing firms, such as Keane, Inc. and
            Renaissance Worldwide.

      Many of our current and potential competitors have longer operating
histories, more established reputations and potential partner relationships and
greater financial, technical, industry and marketing resources than we do. This
may place us at a disadvantage to our competitors.

Risks Relating to Ownership of Our Stock

We are, and will continue to be, controlled by our officers and directors, which
could result in us taking actions that other stockholders do not approve.

      Our executive officers, directors and existing 5% and greater stockholders
beneficially own or control greater than 40% of the voting power of our common
stock. This concentration of ownership of our common stock may make it difficult
for other Perficient stockholders to successfully approve or defeat matters
which may be submitted for action by our stockholders. It may also have the
effect of delaying, deterring or preventing a change in control of our company.
In addition, sales of our common stock by the former Compete, Inc. stockholders
to a third party may result in a change of control of our company.

It may be difficult for another company to acquire us, and this could depress
our stock price.

      Provisions of our certificate of incorporation, by-laws and Delaware law
could make it difficult for a third party to acquire us, even if doing so would
be beneficial to our stockholders. In addition, under our agreement with IBM, we
have granted IBM a right of first refusal with respect to any transaction with a
company that has a substantial portion of its business in the web application
server product and services


                                       14


market, other than a systems integrator or professional services firm. As a
result, a potential acquirer may be discouraged from making an offer to buy us.

We may need additional capital in the future, which may not be available to us.
The raising of any additional capital may dilute your ownership in us.

      We may need to raise additional funds through public or private debt or
equity financing in order to:

      o     take advantage of opportunities, including more rapid expansion or
            acquisitions of, or investments in, businesses or technologies;

      o     develop new services; or

      o     respond to competitive pressures.

            Any additional capital raised through the sale of equity may dilute
your ownership percentage in our stock. Furthermore, we cannot assure you that
any additional financing we may need will be available on terms favorable to us,
or at all. In such case, our business results would suffer.


                                       15


          SPECIAL CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

      This prospectus contains many forward-looking statements that involve
substantial risks and uncertainties. You can identify these statements by
forward-looking words such as "may", "will", "expect", "anticipate", "believe",
"estimate", and "continue" or similar words. You should read statements that
contain these words carefully because they discuss our future expectations,
contain projections of our future operating results or of our financial
condition or state other "forward-looking" information.

      We believe that it is important to communicate our future expectations to
our investors. However, we may be unable to accurately predict or control events
in the future. The factors listed in the section captioned "Risk Factors" as
well as any other cautionary language in this prospectus, provide examples of
risks, uncertainties and events that may cause our actual results to differ
materially from the expectations we describe in our forward-looking statements.
Before you invest in our common stock, you should be aware that the occurrence
of the events described in the "Risk Factors" section and elsewhere in this
prospectus could seriously harm our business.

ITEM 2. DESCRIPTION OF PROPERTY

      We lease approximately 5,900 square feet of office space in Austin, Texas
from HUB Properties Trust . The initial term of the lease is three years from
April 2000 but we have the right to extend the lease for two additional periods
of three years each. Annual fixed rent is $10,314 per month in the first year of
the initial term, $10,560 per month in the second year of the initial term, and
$10,805 per month in the third year. We are also obligated to pay 5.77% of our
landlord's taxes and operating costs associated with the building as additional
rent, resulting in a total monthly rental payment of approximately $15,000.
During November 2000, we began subleasing approximately 2,900 square feet of
office space in Austin, Texas from Powershift Ventures, LLC, under an agreement
that terminates on the earlier of December 31, 2003 or the termination of
Powershift Ventures, LLC's underlying lease. The rent is approximately $4,800
per month plus operating expenses. Steven G. Papermaster, a member of our Board
of Directors, is the president and a beneficial owner of Powershift Ventures,
LLC. Mr. Papermaster also controls Powershift Ventures, L.P., one of our
principal stockholders.

      We lease approximately 1,100 square feet of office space in New London,
Connecticut under an agreement with Columbus Park, which terminates on October
31, 2002. Annual rent is $1,243 per month during the first year and $1,280 per
month during the second year. We lease approximately 4,320 square feet of office
space in Lisle, Illinois from Chicago Title and Trust Company under a lease
expiring on September 14, 2001. The rent is approximately $6,900 per month. We
began leasing office space in Maidenhead, England under a lease that expires in
August 2001 for approximately $9,500 per month. We previously leased office
space in Maidenhead, England under a lease that expired in March 2001 for
approximately $3,200 per month. We lease approximately 2,400 square fee of
office space in London, Ontario under an agreement that expires March 2004, for
approximately $3,200 per month.

ITEM 3. LEGAL PROCEEDINGS

      We are not currently a party to any material legal proceedings.

      We received a demand letter from a company claiming that our web site
induces patent infringement by others and requesting that we enter into a
license agreement with the company that could require us to pay up to $150,000.
We believe the claim is without merit and intend to continue to vigorously
defend the claim.

ITEM 4. SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS

      We did not submit any matters to a vote of security holders during the
fourth quarter of the fiscal year ending December 31, 2000.


                                       16


ITEM 4A. EXECUTIVE OFFICERS

      Our executive officers and directors, and their ages as of the date of
this Prospectus are as follows:

                 Name            Age         Position with Perficient
      -------------------------  ---  ------------------------------------
      John T. McDonald.........   37  Chief Executive Officer and Chairman of
                                      the Board of Directors
      Sam J. Fatigato..........   40  President, Chief Operating Officer and
                                      Director
      John A. Hinners..........   44  Chief Financial Officer and Vice President
      Steven G. Papermaster....   42  Director
      David S. Lundeen.........   38  Director
      Dr. W. Frank King(1).....   60  Director
      Philip J. Rosenbaum(1)...   50  Director

      ----------

      (1)   Indicates that the individual is a member of the compensation and
            audit committees.

Executive Officers and Directors

      John T. McDonald joined Perficient in April 1999 as our Chief Executive
Officer and was elected Chairman of the Board in March 2001. Since October 1998,
Mr. McDonald has been the president of Beekman Ventures, Inc., a venture capital
firm specializing in private equity investments in technology companies. From
April 1996 to October 1998, Mr. McDonald was president of VideoSite, Inc., a
multimedia software company that is currently a subsidiary of GTECH Corporation.
GTECH acquired VideoSite in October 1997, 18 months after Mr. McDonald became
VideoSite's president. From May 1995 to April 1996, Mr. McDonald was a Principal
with Zilkha & Co., a New York-based merchant banking firm. From June 1993 to
April 1996, Mr. McDonald served in various positions at Blockbuster
Entertainment Group, including Director of Corporate Development and Vice
President, Strategic Planning and Corporate Development of NewLeaf Entertainment
Corporation, a joint venture between Blockbuster and IBM. From 1987 to 1993, Mr.
McDonald was an attorney with Skadden, Arps, Slate, Meagher & Flom in New York
focusing on mergers and acquisitions and corporate finance. Mr. McDonald
received a B.A. in Economics from Fordham University in 1984 and a J.D. from
Fordham Law School in 1987.

      Steven G. Papermaster joined Perficient in April 1998 as a director and
served as Chairman from May 1999 through February 2001. He is also the Chairman
of Powershift Group, an Austin-based technology venture development firm, and
the general partner of Powershift Ventures, L.P., one of our principal
stockholders. Mr. Papermaster is also a co-founder and served as the Chief
Executive Officer through November 2000. He currently serves as a member of the
Board of Directors of Vignette Corporation and various privately-held companies.
From 1987 to December 1997, Mr. Papermaster was the founder, chairman and Chief
Executive Officer of BSG Corporation. Mr. Papermaster received a B.A. in Finance
from the University of Texas at Austin in 1981 and began his career as a
consultant with Arthur Andersen & Co. in the Management Information Consulting
Division.

      Sam J. Fatigato was appointed to our Board of Directors and was named
President in March 2001 and has served as our Chief Operating Officer since May
1, 2000, upon the acquisition by way of merger of Compete, Inc. From 1996 until
May 2000, Mr. Fatigato served as Chief Executive Officer of Compete, Inc. Prior
to co-founding Compete, Mr. Fatigato was employed by IBM for 12 years, where he
held various technical, sales and operational management positions. Mr. Fatigato
received a B.A. from Northwestern University in 1983.

      John A. Hinners joined Perficient in April 1999 as Chief Financial Officer
and Vice President. From March 1998 until joining Perficient, Mr. Hinners
independently provided financial consulting services primarily to start-up
software companies. From October 1994 to February 1998, he was Managing
Director-Finance and Administration of BSG Alliance/IT, Inc., a subsidiary of
BSG Corporation. During this period, Mr. Hinners was responsible for operational
and financial management of international


                                       17


subsidiaries and joint ventures, as well as financial review and management of
acquisitions and significant transactions. From August 1988 through September
1994, he served as Chief Financial Officer of such subsidiary. Mr. Hinners
received a B.B.A. in Finance in 1979 and an M.B.A. in Accounting in 1981 from
the University of Texas at Austin.

      David S. Lundeen joined Perficient in April 1998 as a director. Since
March 1999, Mr. Lundeen has been a partner with Watershed Capital, a private
equity firm based in Mountain View, California. From June 1997 to February 1999,
Mr. Lundeen was self-employed, managed his personal investments and acted as a
consultant and advisor to various businesses. From June 1995 to June 1997, he
served as the Chief Financial Officer and Chief Operating Officer of BSG. From
January 1990 until June 1995, Mr. Lundeen served as President of Blockbuster
Technology and as Vice President of Finance of Blockbuster Entertainment
Corporation. Prior to that time, Mr. Lundeen was an investment banker with
Drexel Burnham Lambert in New York City. Mr. Lundeen received a B.S. in
Engineering from the University of Michigan in 1984 and an M.B.A. from the
University of Chicago in 1988.

      Dr. W. Frank King became a member of our Board of Directors in June 1999.
He has served as a Director of PSW Technologies, Inc., now known as Concero
Inc., a publicly-traded consulting services company, since October 1996. From
1992 to August 1998, Dr. King served as President and Chief Executive Officer of
PSW. From 1988 to 1992, Dr. King was Senior Vice President of the Software
Business group of Lotus, a software publishing company. Prior to joining Lotus,
Dr. King was with IBM for 19 years, where his last position was Vice President
of Development for the Personal Computing Division. Dr. King currently serves on
the boards of directors of Allaire Corp., Aleri, Inc., Eon Communications, Inc.,
and Natural Microsystems Corporation. Dr. King earned a Ph.D. in electrical
engineering from Princeton University, an M.S. in electrical engineering from
Stanford University and a B.S. in electrical engineering from the University of
Florida.

      Philip J. Rosenbaum became a member of our Board of Directors in June
1999. Since May 1995, Mr. Rosenbaum has been a self-employed developer of new
businesses, investor and consultant. From February 1993 to May 1995, Mr.
Rosenbaum was Vice President of International Operations of Unify Corporation, a
software development tool supplier. Mr. Rosenbaum also serves on the board of
directors of a privately held software company. Mr. Rosenbaum received a B.S.
from Rutgers in 1972.


                                       18


ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

      Our common stock is traded on the Nasdaq SmallCap Market under the symbol
"PRFT." Public trading of the common stock commenced on July 29, 1999. Prior to
that, there was no public market for the common stock. The following table sets
forth, for the periods indicated, the high and low sale price per share of the
common stock on the Nasdaq SmallCap Market.

Year Ended December 31, 1999:                                   High       Low
                                                               ------     ------

Third Quarter (from July 29, 1999)                             $12.00     $ 6.25
Fourth Quarter                                                  17.88       6.50

Year Ended December 31, 2000:

First Quarter                                                  $27.13     $10.06
Second Quarter                                                  21.00      11.00
Third Quarter                                                   18.13       8.94
Fourth Quarter                                                  19.38       5.00

      As of March 23, 2001, there were in excess of 400 beneficial holders of
our common stock. On March 23, 2001, the last sale price reported on the Nasdaq
SmallCap Market for our common stock was $4.8125 per share.

      We have never declared or paid any cash dividends on our common stock or
other securities and do not anticipate paying cash dividends in the foreseeable
future. Our line of credit currently prohibits the payment of cash dividends.

      We received approximately $6.3 million in July 1999 from an initial public
offering of 1,000,000 shares of our common stock, net of underwriting discounts,
commissions and expenses. The primary purposes of the initial public offering
were to obtain additional equity capital, create a public market for our common
stock and facilitate future access to public markets. Pending the use of
proceeds, we had invested the net proceeds of the offering in investment grade,
interest-bearing securities. Prior to the offering, we financed our operations
primarily through equity financing and bank borrowings.

      On February 7, 2000, we sold 400,000 shares of common stock at $14 per
share in a private placement for net proceeds of approximately $5,258,000. We
used the proceeds to fund the cash portion of the purchase price of Compete, the
promissory note for the acquisition of Compete and for general corporate
purposes.


                                       19


ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

      The following discussion and analysis of our financial condition and
results of operations should be read in conjunction with our financial
statements and notes thereto and the other financial information included
elsewhere in this Report on Form 10-KSB. In addition to historical information,
this management's discussion and analysis of financial condition and results of
operations and other parts of this filing contain forward-looking information
that involves risks and uncertainties. Our actual results could differ
materially from those indicated in such forward-looking information as a result
of certain factors, including but not limited to, those set forth under "Risk
Factors" and elsewhere in this filing. Please see the "Special Note Regarding
Forward Looking Statements" elsewhere in this Report on Form 10-KSB.

      We were incorporated in September 1997 and began generating revenue in
February 1998. We generate revenues from professional services performed
primarily for our software company partners and their end-user customers. To
date, our partners have consisted of Internet software companies and we expect
that Internet software companies will be important partners for the foreseeable
future. The majority of our revenue is derived from our partners rather than
from our end-user customers.

      We established our first partner relationship with Vignette Corporation,
an Internet relationship management software company, in February 1998. During
1999 and 2000, we have established partner relationships with several additional
Internet software companies. In October 2000 we entered into a new services
agreement with IBM under which we will provide deployment, integration and
training services to IBM's WebSphere(TM) customers. The agreement provides for
us to render services over a three-year period not to exceed $73.5 million in
total value. Revenues from Vignette, IBM, and Plumtree would have comprised
approximately 26%, 25%, and 8%, respectively, of pro forma revenues for the year
ended December 31, 2000 (after giving effect to the acquisition of Compete).
Accordingly, any deterioration in our relationship with IBM, Vignette, or
Plumtree could have a material adverse affect on our consulting revenue.
Generally, our partner agreements may be terminated at any time by our partners
or by us. Our agreement with IBM, however, provides generally that we receive
four month's notice of any termination. These agreements generally do not
obligate our partners to use our services for any minimum amount or at all, and
our partners may use the services of our competitors. Under our agreement with
Vignette, we are restricted, for as long as the agreement is in place, from
performing services for their competitors.

      We derive our revenues from professional services that are provided
primarily on a time and materials basis. Revenues are recognized and billed
monthly by multiplying the number of hours expended by our professionals in the
performance of the contract by the established billing rates. We are reimbursed
for direct expenses allocated to a project such as airfare, lodging and meals.
Consequently, these direct reimbursements are excluded from revenues.

      Our revenues and operating results are subject to substantial variations
based on our partners' sales and expenditures and the frequency with which we
are chosen to perform services for their end-user customers. Revenues from any
given customer will vary from period to period. We expect, however, that
significant customer concentration will continue for the foreseeable future. To
the extent that any significant customer uses less of our services or terminates
its relationship with us, our revenues may decline substantially.

      Our gross margins are affected by trends in the utilization rate of our
professionals, defined as the percentage of our professionals' time billed to
customers, divided by the total available hours in a period. If a project ends
earlier than scheduled, or, as has been the case, we retain professionals in
advance of receiving project assignments, our utilization rate will decline and
adversely affect our gross margins.

      The number of technology professionals who have agreed to perform services
for the Company has increased from eight at December 31, 1998 to approximately
150 currently. We intend to increase the number of our technology professionals
significantly. Our personnel costs represent a high percentage of our operating
expenses and are relatively fixed in advance of each quarter. Accordingly, if
revenues do not


                                       20


increase at a rate equal to expenses, we will incur continuing losses and our
business, financial condition, operating results and liquidity will be
materially and adversely affected.

      On May 1, 2000, we acquired all the outstanding shares and assumed all
outstanding options of Compete, Inc. The aggregate purchase price of Compete
consisted of (1) $3,425,000 in cash, (2) $2,527,500 in non-interest bearing
promissory notes to be repaid within six months following the closing, (3)
2,003,866 shares of common stock, of which 1,001,933 shares are subject to
adjustment or forfeiture and which are now being held in escrow, and (4) the
assumption of Compete's outstanding employee options. The total cost of the
acquisition, including the assumption of outstanding options and transaction
costs, was approximately $55.2 million. The acquisition was accounted for as a
purchase business combination. Accordingly, the acquired net assets were
recorded at their estimated fair values at the effective date of the acquisition
and the results of operations of Compete will be included with ours for the
periods subsequent to the acquisition date.

      On January 3, 2000, we acquired LoreData, Inc. for an aggregate purchase
price of approximately $2.4 million, consisting of $385,000 cash, 30,005 shares
of common stock, and 131,709 shares of common stock that were held in escrow
until being released in January 2001.

      On February 7, 2000, we sold 400,000 shares of common stock in a private
placement for net proceeds of approximately $5,258,000.

Results Of Operations

Fiscal Year Ended December 31, 1999 Compared To December 31, 2000

      Consulting Revenues. Revenues increased from $2,648,000 in 1999 to
$19,964,000 in 2000. The increase in revenues reflected the increase in the
number of partners, projects performed and in the number of technology
professionals performing services. The acquisition of Compete on May 1, 2000
also contributed to the increase in revenues for 2000. On a pro forma basis,
including the results of the acquisitions of Compete and Lore Data, revenues
increased from $9,711,000 in 1999 to $23,111,000 in 2000. During 2000, 30% of
our revenues was derived from Vignette and 25% from IBM (on a pro forma basis
including the results of operations of Compete, Vignette accounted for 26% of
total pro forma revenues and IBM accounted for 25% of total pro forma revenues).

      Cost of Consulting Revenues. Cost of revenues, consisting of direct costs,
primarily salaries and benefits for technology professionals assigned to
projects, and of project related expenses, increased from $1,034,000 in 1999 to
$9,931,000 in 2000. The increase in cost of consulting revenue is directly
attributable to the increase in the number of technology professionals employed
by us. The number of consultants employed by us increased from 43 at December
31, 1999 to approximately 150 at December 31, 2000.

      Gross Margin. Gross margin increased from $1,614,000 in 1999 to
$10,033,000 in 2000. Gross margin as a percentage of consulting revenues was 61%
for 1999 and 50% for 2000. The decrease in gross margin as a percentage of
consulting revenues is primarily due to the increased number of consultants
during the period in anticipation of future projects, resulting in lower
effective utilization rates during the period.

      Selling, general and administrative. Selling, general and administrative
expenses consist primarily of marketing activities to solicit partners, salaries
and benefits and non-reimbursable travel costs and expenses. Selling, general
and administrative expenses increased from $2,197,000 in 1999 to $10,580,000 in
2000. Selling, general and administrative expenses as a percentage of consulting
revenues was 83% for 1999 and 53% for 2000. The increase in selling, general and
administrative expenses and such expenses was related to our increased overhead,
including recruiting, administrative activities and marketing to support the
development of existing or new partnerships and the resulting growth in our
workforce. We expect these expenses to increase in absolute dollar amounts in
connection with our planned expansion.

      Stock Compensation. Stock compensation expense consists of non-cash
compensation arising from


                                       21


certain sales of stock and option grants to officers, directors or other
affiliated persons. We have recognized $880,000 in non-cash compensation in
connection with the sale of stock that occurred in January 1999. In addition, we
have recorded in stockholders' equity on our balance sheet aggregate deferred
stock compensation totaling $228,000 in connection with stock options that were
granted in January 1999. Quarterly stock compensation expense of approximately
$19,000 will be recognized over the three-year vesting period ending January
2002. We have recognized approximately $152,000 in non-cash compensation expense
during 1999 and 2000 relating to the vesting of these options.

      Intangibles amortization. Intangibles amortization expense consists of
amortization of goodwill arising from our acquisitions of LoreData, Inc. in
January 2000, Compete, Inc. in May 2000, and Core Objective, Inc. in November
2000. We are amortizing the goodwill associated with these acquisitions over a
three-year period. Total intangibles amortization expense for 2000 was
$12,942,000. We expect to amortize in excess of $4,800,000 in goodwill per
quarter through 2003. Goodwill net of accumulated amortization represented
approximately 83% and 91% of total assets and stockholders' equity,
respectively, at December 31, 2000.

      Interest Income (Expense). Interest income (expense) consists of interest
income of $263,000 on cash and investments, imputed interest expense of $108,000
associated with the non-interest bearing note issued in connection with the
acquisition of Compete, and interest expense of $43,000, mainly associated with
borrowings under our line of credit. The increase in interest income for 2000
was due to interest income from cash and investment balances on hand as a result
of our initial public offering in July 1999 and our private placement in
February 2000. The increase in interest expense in 2000 is due to the $2.5
million note payable related to the Compete acquisition and the borrowings under
our line of credit during 2000.

Liquidity And Capital Resources

      We received approximately $6.3 million in July 1999 from an initial public
offering of 1,000,000 shares of our common stock, net of underwriting discounts,
commissions and expenses. The primary purposes of the initial public offering
were to obtain additional equity capital, create a public market for our common
stock and facilitate future access to public markets. Pending the use of
proceeds, we had invested the net proceeds of the offering in investment grade,
interest-bearing securities. Prior to the offering, we financed our operations
primarily through equity financing and bank borrowings.

      On February 7, 2000, we sold 400,000 shares of common stock at $14 per
share in a private placement for net proceeds of approximately $5,258,000. We
used the proceeds to fund the cash portion of the purchase price and the
promissory note for the acquisition of Compete and for general corporate
purposes.

      In connection with the acquisition of Compete, which closed on May 1,
2000, we paid to the shareholders and vested option holders of Compete
approximately $3,425,000 in cash and we issued a $2,527,500 promissory note that
was paid on November 1, 2000. We used the proceeds of the private placement to
fund the initial cash payment, and utilized the remaining private placement
funds and certain proceeds from the line of credit to fund the November 1, 2000
note payment.

      We have a line of credit facility with Silicon Valley Bank, which provides
for us to borrow up to $6,000,000, subject to certain borrowing base
calculations as defined. Borrowings under this agreement, which expires June 29,
2001, bear interest at the bank's prime rate plus 0.85%. As of December 31,
2000, there was $1,500,000 borrowed under this loan agreement. Prior to that, we
had an agreement with the same bank, which allowed us to borrow up to $1,000,000
against our qualifying accounts receivables. In connection with this bank
agreement, we issued warrants to the Bank to acquire up to 3,750 shares of our
common stock at $8 per share.

      In connection with the acquisition of Core Objective, Inc. in November
2000, we issued a $162,000 promissory note payable in May 2001. Additionally, we
assumed $63,000 of notes payable to shareholders which were paid in February
2001.


                                       22


      Cash used in operations for the year ended December 31, 2000 was
$2,796,000. As of December 31, 2000, we had $842,000 in cash and working capital
of $3,374,000, and $4,500,000 available ($3,700,000 available under the
borrowing base calculation) under our line of credit facility discussed above.

      If our capital is insufficient to fund our activities in either the short
or long term, we may need to raise additional funds. If we raise additional
funds through the issuance of equity securities, our existing stockholders'
percentage ownership will be diluted. These equity securities may also have
rights superior to our common stock. Additional debt or equity financing may not
be available when needed or on satisfactory terms. If adequate funds are not
available on acceptable terms, we may be unable to expand our services, respond
to competition, pursue acquisition opportunities or continue our operations.

Recent Accounting Pronouncements

      In June 1998, the Financial Accounting Standards Board (FASB) issued the
Statement of Financial Accounting Standard (SFAS) No. 133, Accounting for
Derivative Instruments and Hedging Activities, as amended by SFAS No. 137,
Deferral of the Effective Date of FASB Statement No. 133, which is effective for
fiscal years beginning after June 15, 2000. This statement requires companies to
record derivatives on the balance sheet as assets or liabilities measured at
fair value. Gains or losses resulting from changes in the values of those
derivatives would be accounted for depending on the use of the derivative and
whether it qualifies for hedge accounting. SFAS No. 133 will be effective for
our financial statements for the year ending December 31, 2001. We do not
believe that this statement will have a material impact on our financial
position or results of operations.

      The FASB recently issued Interpretation No. 44, Accounting for Certain
Transactions Involving Stock Compensation. This interpretation provides guidance
related to the implementation of APB 25, Accounting for Stock Issued to
Employees. This interpretation is to be applied prospectively to all new awards,
modifications to outstanding awards and changes in employee status on or after
July 1, 2000. For changes made after December 15, 1998 to awards that affect
exercise prices of the awards, we must prospectively account for the impact of
those changes. We do not believe the full adoption of this interpretation will
have a material impact on our financial position or results of operations.

      In December 1999, the Securities and Exchange Commission staff released
Staff Accounting Bulletin No. 101, Revenue Recognition in Financial Statements,
which provides guidance on the recognition, presentation, and disclosure of
revenue in financial statements. We believe our current revenue recognition
policies and practices are materially consistent with this statement, and
accordingly, do not believe this statement will have a material impact on our
financial position or results of operations.


                                       23


Summary Unaudited Pro Forma Statements of Operations (including the effect of
material acquisitions)

      The following unaudited pro forma statements of operations (including the
effect of material acquisitions) give effect to the acquisition of Lore Data,
Inc. and the acquisition of Compete, Inc. as if these transactions had been
consummated at the beginning of each period presented. The unaudited pro forma
statements of operations exclude the impact of goodwill amortization, stock
compensation, depreciation and one time acquisition related charges. The
unaudited pro forma statements of operations do not purport to be indicative of
the results of operations that would have been obtained had such acquisitions
been completed as of the assumed dates and for the periods presented or of
future results. The results do not include any information related to Core
Objective, Inc. acquired in November 2000, which did not represent a material
acquisition. You should read this information together with "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
our consolidated financial statements and the notes relating to those statements
included elsewhere in this Report on Form 10-KSB. These pro forma statements of
operations are presented because management believes pro forma net income (loss)
is a widely accepted indicator of a company's operating performance. Pro forma
net income measures presented may not be comparable to similarly titled measures
presented by other companies. Pro forma net income (loss) is not intended to be
a performance measure that should be regarded as an alternative to, or more
meaningful than, either operating income (loss) or net income (loss) as an
indicator of operating performance or to the statement of cash flows as a
measure of liquidity. Our historical GAAP basis cash used in operations,
excluding the pro forma effects of material acquisitions, was approximately
$665,000 and $2,796,000 during 1999 and 2000, respectively.

                                Perficient, Inc.
                 Pro Forma Consolidated Statements of Operations
                Including the Effect of Significant Acquisitions

                                                          Year December 31,
                                                      --------------------------
                                                          1999           2000
                                                      -----------    -----------
                                                              (unaudited)

Consulting revenues                                   $ 9,710,818    $23,110,578

Cost of consulting revenues                             5,160,861     11,421,371
                                                      -----------    -----------
Gross margin                                            4,549,957     11,689,207

Selling, general and administrative                     4,508,162     11,311,092
                                                      -----------    -----------
Total pro forma operating income (1)                       41,795        378,115
Interest income (expense), net                            (54,631)        94,239

Pro forma provision (benefit) for
  income taxes (2)                                         (4,749)       174,771
                                                      -----------    -----------
Pro forma net income (loss) (1)                       $    (8,087)   $   297,583
                                                      ===========    ===========
Pro forma net income (loss) per share(1):
  Basic                                               $        --    $      0.06
                                                      ===========    ===========
  Diluted                                             $        --    $      0.04
                                                      ===========    ===========
Shares used in computing basic pro forma net
  income (loss) per share                               4,032,494      4,940,260
                                                      ===========    ===========
Shares used in computing diluted pro forma net
  income (loss) per share                               4,032,494      6,855,105
                                                      ===========    ===========

- ----------
      (1)   Pro forma operating income, pro forma net income (loss) and pro
            forma net income (loss) per share exclude the impact of goodwill
            amortization, depreciation, stock compensation, and one time
            acquisition related charges.

      (2)   Pro forma net income (loss) and pro forma net income (loss) per
            share include a tax provision (benefit) at an assumed effective rate
            of 37%.

                                       24


ITEM 7. CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

      The financial statements and supplementary data required by this Item 7
are listed in Item 13(a)(1) and begin at page F-1 of this report.

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

      Not applicable.

                                    PART III

ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

      The information regarding directors is incorporated herein by reference
from the section entitled "Election of Directors" of our definitive Proxy
Statement (the "Proxy Statement") to be filed pursuant to Regulation 14A of the
Securities Exchange Act of 1934, as amended, for our Annual Meeting of
Stockholders to be held on June 14, 2001. The Proxy Statement is anticipated to
be filed within 120 days after the end of our fiscal year ended December 31,
2000. For information regarding executive officers, see the information
appearing under the caption "Executive Officers of the Registrant" in Part I,
Item 4a of this Report on Form 10-KSB.


                                       25


ITEM 10. EXECUTIVE COMPENSATION

      Information regarding executive compensation is incorporated herein by
reference from the section entitled "Executive Compensation and Related
Information" of the Proxy Statement.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

      Information regarding security ownership of certain beneficial owners and
management is incorporated herein by reference from the section entitled "Stock
Ownership of Certain Beneficial Owners and Management" of the Proxy Statement.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      Information regarding certain relationships and related transactions is
incorporated herein by reference from the section entitled "Certain
Relationships and Related Information" of the Proxy Statement.

ITEM 13. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a)(1) Financial Statements

      The following consolidated financial statements of the Company are filed
as part of this Annual Report on Form 10-KSB as follows:

Report of Independent Auditors...............................................F-2
Consolidated Balance Sheets at December 31, 1999 and 2000....................F-3
Consolidated Statements of Operations for the years ended
  December 31, 1999 and 2000.................................................F-4
Consolidated Statements of Changes in Stockholders' Equity...................F-5
Consolidated Statements of Cash Flows for the years ended
  December 31, 1999 and 2000.................................................F-6
Notes to Consolidated Financial Statements...................................F-7

(a)(2) Financial Statement Schedules

      Not applicable.


                                       26


(a)(3) Exhibits

Exhibit
    No.                          Description
- --------------------------------------------------------------------------------
3.1+        Certificate of Incorporation of Registrant.
3.2+        Bylaws of Registrant.
4.1+        Specimen Certificate for shares of common stock.
4.2+        Warrant granted to Gilford Securities Incorporated.
10.2+       1999 Stock Option/Stock Issuance Plan.
10.3+       Employment Agreement between Registrant and John T. McDonald.
10.5+       Employment Agreement between Registrant and John A. Hinners.
10.6+       Form of Indemnity Agreement between Registrant and its directors and
            officers
10.7+       Contractor Service Agreement, dated December 31, 1998, between
            Registrant and Vignette Corporation.
10.13*      Agreement and Plan of Merger, dated as of December 10, 1999, by and
            among the Registrant, Perficient Acquisition Corp., LoreData, Inc.
            and John Gillespie.
10.14*      Amendment to Agreement and Plan of Merger dated as of January 3,
            2000 by and among the Registrant, Perficient Acquisition Corp,
            LoreData, Inc. and John Gillespie.
10.15**     Agreement and Plan of Merger, dated as of February 16, 2000 by and
            among the Registrant, Perficient Compete, Inc., Compete Inc., and
            the Shareholders of Compete, Inc.
10.16***    Registration Rights Agreement, dated as of January 3, 2000 between
            the Registrant and John Gillespie.
10.17***    Form of Registration Rights Agreement between the Registrant and
            certain purchasers of common stock.
10.18***    Subcontract Agreement, dated as of November 4, 1999 between the
            Registrant and Plumtree, Inc.
10.19++     Lease by and between HUB Properties Trust and the Registrant.
10.20       Agreement dated October 10, 2000 between the Registrant and
            International Business Machines, Inc.
10.21       Employment Agreement between Registrant and John T. McDonald,
            effective October 30, 2000
21          Subsidiaries
23.1        Consent of Ernst & Young LLP

- ----------
      +     Previously filed with the Securities and Exchange Commission as an
            Exhibit to the Company's Registration Statement on Form SB-2 (File
            No. 333-78337) declared effective on July 28, 1999 by the Securities
            and Exchange Commission and incorporated herein by reference.

      ++    Previously filed with the Securities and Exchange Commission as an
            Exhibit to the Company's Registration Statement on Form SB-2 (File
            No. 333-35948) declared effective on July 6, 2000 by the Securities
            and Exchange Commission and incorporated herein by reference.

      *     Previously filed with the Securities and Exchange Commission as an
            Exhibit to the Company's Current Report on Form 8-K filed on January
            14, 2000 and incorporated herein by reference.

      **    Previously filed with the Securities and Exchange Commission as an
            Exhibit to the Company's Preliminary Proxy Statement filed on March
            16, 2000 and incorporated herein by reference.

      ***   Previously filed with the Securities and Exchange Commission as an
            Exhibit to the Company's Annual Report on Form 10-KSB filed on March
            30, 2000 and incorporated herein by reference.

(b) Reports on Form 8-K

      None.


                                       27


SIGNATURES

      Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                        PERFICIENT, INC.
                                        (Registrant)


                                        /s/ John T. McDonald
                                        ----------------------------------------
                                        John T. McDonald
                                        Chief Executive Officer

                                        March 30, 2001
                                        ----------------------------------------
                                        Date

      Pursuant to the requirements of the Securities and Exchange Act of 1934,
this report has been duly signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

        Name                            Title                     Date
- ----------------------------   -----------------------------  ------------------
                               Chief Executive                March 30, 2001
                               Officer and Chairman of the
                               Board
/s/ JOHN T. MCDONALD           (Principal Executive Officer)
- ----------------------------
John T. McDonald

                               President, Chief Operating     March 30, 2001
/s/ SAM J. FATIGATO            Officer and Director
- ----------------------------
Sam J. Fatigato

                               Vice President and Chief       March 30, 2001
/s/ JOHN HINNERS               Financial Officer
- ----------------------------
John Hinners


/s/ STEVEN G. PAPERMASTER      Director                       March 30, 2001
- ----------------------------
Steven G. Papermaster


/s/ DAVID S. LUNDEEN           Director                       March 30, 2001
- ----------------------------
David S. Lundeen


/s/ Dr. W. FRANK KING          Director                       March 30, 2001
- ----------------------------
Dr. W. Frank King


/s/ PHILIP J. ROSENBAUM        Director                       March 30, 2001
- ----------------------------
Philip J. Rosenbaum


                                       28


                                PERFICIENT, INC.
                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Auditors...............................................F-2
Consolidated Balance Sheets at December 31, 1999 and 2000....................F-3
Consolidated Statements of Operations for the years ended
  December 31, 1999 and 2000.................................................F-4
Consolidated Statements of Changes in Stockholders' Equity...................F-5
Consolidated Statements of Cash Flows for the years ended
  December 31, 1999 and 2000.................................................F-6
Notes to Consolidated Financial Statements...................................F-7


                                      F-1


                         REPORT OF INDEPENDENT AUDITORS

The Board of Directors and Stockholders
Perficient, Inc. and Subsidiaries

      We have audited the accompanying consolidated balance sheets of
Perficient, Inc. and Subsidiaries as of December 31, 2000 and 1999, and the
related consolidated statements of operations, changes in stockholders' equity
and cash flows for the years then ended. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

      We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

      In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Perficient,
Inc. and Subsidiaries at December 31, 2000 and 1999, and the consolidated
results of their operations and their cash flows for the years then ended, in
conformity with accounting principles generally accepted in the United States.


                                        /s/ Ernst & Young LLP

Austin, Texas
January 25, 2001


                                      F-2


                                PERFICIENT, INC.
                           CONSOLIDATED BALANCE SHEETS



                                                                December 31,
                                                        ----------------------------
                                                            1999            2000
                                                        ------------    ------------
                                                                  
                       Assets
  Current assets:
    Cash                                                $  5,818,918    $    842,481
    Accounts receivable, net of allowance
      for doubtful accounts of $68,058 in
      1999 and $563,357 in 2000                              563,334       7,038,794

    Income tax receivable                                     10,916          10,916

    Other current assets                                     142,422          42,400
                                                        ------------    ------------
  Total current assets                                     6,535,590       7,934,591
  Property and equipment:

    Hardware                                                  69,442         657,648

    Furniture and fixtures                                     3,415         260,738

    Leasehold improvements                                        --         106,688

    Software                                                  41,783         119,804

    Accumulated depreciation                                 (33,813)       (340,472)
                                                        ------------    ------------
  Net property and equipment                                  80,827         804,406

  Intangible assets:

    Excess of cost over fair value of assets                      --      58,499,743

    Accumulated amortization                                      --     (12,941,570)
                                                        ------------    ------------
  Net intangible assets                                           --      45,558,173

  Other noncurrent assets                                         --         317,772
                                                        ------------    ------------
Total assets                                            $  6,616,417    $ 54,614,942
                                                        ============    ============

          Liabilities and stockholders' equity

  Liabilities
  Current liabilities:
    Accounts payable                                    $    165,176    $    358,779

    Note payable to related party                                 --         224,969

    Line of credit                                                --       1,500,000

    Current portion of note payable                               --           3,338

    Current portion of capital lease obligation                   --          81,415

    Other current liabilities                                199,150       2,392,568
                                                        ------------    ------------
  Total current liabilities
                                                             364,326       4,561,069

  Note payable, less current portion                              --           7,232

  Capital lease obligation, less current portion                  --          72,694
                                                        ------------    ------------
  Total liabilities                                          364,326       4,640,995
  Commitments and contingencies
  Stockholders' equity:
    Common Stock, $.001 par value; 20,000,000 shares
      authorized; 3,503,333 shares in 1999 and
      6,252,233 shares in 2000 issued and outstanding          3,503           6,252

    Additional paid-in capital                             7,777,392      65,049,514

    Unearned stock compensation                             (152,000)        (76,000)

    Accumulated other comprehensive loss                          --          (1,665)

    Retained deficit                                      (1,376,804)    (15,004,154)
                                                        ------------    ------------
  Total stockholders' equity                               6,252,091      49,973,947
                                                        ------------    ------------
Total liabilities and stockholders' equity              $  6,616,417    $ 54,614,942
                                                        ============    ============


                             See accompanying notes.


                                      F-3


                                PERFICIENT, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                                     Year Ended December 31,
                                                  -----------------------------
                                                      1999             2000
                                                  ------------     ------------

Consulting revenue                                $  2,647,878     $ 19,963,759

Cost of consulting revenue                           1,034,331        9,931,064
                                                  ------------     ------------

           Gross margin                              1,613,547       10,032,695

Operating expenses:

      Selling, general and administrative            2,197,560       10,579,652

      Stock compensation                               956,000           76,000

      Intangibles amortization                              --       12,941,570
                                                  ------------     ------------

           Total operating expenses                  3,153,560       23,597,222

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

Loss from operations                                (1,540,013)     (13,564,527)

      Interest income                                  127,518          263,263

      Interest expense                                 (13,380)        (151,086)
                                                  ------------     ------------

Loss before income taxes                            (1,425,875)     (13,452,350)

      Provision (benefit) for income taxes             (20,912)         175,000
                                                  ------------     ------------
Net loss                                          $ (1,404,963)    $(13,627,350)
                                                  ============     ============

Basic and diluted net loss per share              $      (0.47)    $      (2.96)
                                                  ============     ============

                             See accompanying notes.


                                      F-4


                                PERFICIENT, INC.
           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY



                                                                                                      Accumulated
                                          Common Stock   Additional     Unearned         Other          Retained         Total
                                ---------------------     Paid-in        Stock        Comprehensive     Earnings      Stockholders'
                                  Shares      Amount      Capital     Compensation        Loss          (Deficit)       Equity
                                ---------   ---------   -----------   ------------    ------------    ------------    ------------
                                                                                                 
Balance at January 1, 1999      2,000,000   $   2,000   $   148,000   $         --    $         --    $     28,159    $    178,159

 Issuance of common stock       1,503,333       1,503     7,401,392             --              --              --       7,402,895

 Unearned compensation                 --          --       228,000       (228,000)             --              --              --

 Amortization of unearned
  compensation                         --          --            --         76,000              --              --          76,000

 Net loss                              --          --            --             --              --      (1,404,963)     (1,404,963)
                                ---------   ---------   -----------   ------------    ------------    ------------    ------------
Balance at December 31, 1999    3,503,333       3,503     7,777,392       (152,000)             --      (1,376,804)      6,252,091

 Issuance of common stock,
  net of issuance costs           400,000         400     5,257,691             --              --              --       5,258,091

 Issuance of common stock
  and options in purchase
  of businesses                 2,285,664       2,286    51,858,024             --              --              --      51,860,310

 Stock options exercised           62,736          63        57,025             --              --              --          57,088

 Other                                500          --        99,382             --              --              --          99,382

 Amortization of unearned
  compensation                         --          --            --         76,000              --              --          76,000

 Foreign currency translation
  adjustment                           --          --            --             --          (1,665)             --          (1,665)

 Net loss                              --          --            --             --              --     (13,627,350)    (13,627,350)
                                                                                                                      ------------
  Total comprehensive loss             --          --            --             --              --              --     (13,629,015)
                                ---------   ---------   -----------   ------------    ------------    ------------    ------------
Balance at December 31, 2000    6,252,233   $   6,252   $65,049,514   $    (76,000)   $     (1,665)   $(15,004,154)   $ 49,973,947
                                =========   =========   ===========   ============    ============    ============    ============


                             See accompanying notes.


                                      F-5


                                PERFICIENT, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS



                                                           Year Ended December 31,
                                                        ----------------------------
                                                            1999            2000
                                                        ------------    ------------
                                                                  
Operating Activities

Net loss                                                $ (1,404,963)   $(13,627,350)

Adjustments to reconcile net loss
  to cash used in operations:

  Depreciation                                                22,950         270,270

  Intangibles amortization                                        --      12,941,570

  Non-cash stock compensation                                956,000          76,000

  Non-cash interest expense                                       --         107,810

  Loss from disposal of fixed assets                              --             502

  Deferred income taxes                                       (1,350)             --

  Changes in operating assets and liabilities
    (net of the effect of acquisitions)

    Accounts receivable                                     (398,373)     (3,921,449)

    Other assets                                            (142,422)       (187,890)

    Income tax receivable                                    (10,916)             --

    Accounts payable                                         146,536         152,810

    Income tax payable                                       (19,219)             --

    Accrued liabilities                                      186,511       1,391,286
                                                        ------------    ------------
Net cash used in operating activities                       (665,246)     (2,796,441)

Investing activities

    Purchase of property and equipment                       (61,727)       (610,373)

    Purchase of businesses, net of cash acquired                  --      (7,841,603)

    Proceeds from disposal of fixed assets                        --         204,977
                                                        ------------    ------------
  Net cash used in investing activities                      (61,727)      (8,246,999)

  Financing activities

    Payments on capital lease obligation                          --         (41,866)

    Proceeds from short-term borrowings                      802,673       1,543,531

    Payments on short-term borrowings                       (802,673)       (833,658)

    Proceeds from stock issuances, net                     6,522,895       5,405,560
                                                        ------------    ------------
Net cash provided by financing activities                  6,522,895       6,073,567
                                                        ------------    ------------
Effect of exchange rate on cash and cash equivalents              --          (6,564)

Change in cash and cash equivalents                        5,795,922      (4,976,437)

Cash and cash equivalents at beginning of year                22,996       5,818,918
                                                        ------------    ------------
Cash and cash equivalents at end of year                $  5,818,918    $    842,481
                                                        ============    ============

Supplemental disclosures:
Interest paid                                           $     13,380    $     43,276
                                                        ============    ============

Non-cash activities:
Common stock and options issued in purchase of
      businesses                                        $         --    $ 51,869,311
                                                        ============    ============
Issuance of note payable in purchase of business        $         --    $    162,215
                                                        ============    ============
January 12, 1999 issuance of 500,000 common shares in
      exchange for shareholder receivable               $    250,000    $         --
                                                        ============    ============


                             See accompanying notes.


                                      F-6


                                PERFICIENT, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2000

1. Business Overview

      Perficient, Inc. (the "Company") is a software services firm that uses
emerging technologies to web-enable complex enterprise systems. The Company
builds deep expertise around a targeted set of core technologies and products
through unique outsourcing partnerships (called "Virtual Services Organizations"
or "VSOs") with Internet software companies.

      The Company was incorporated on September 17, 1997 in Texas. The Company
began operations in 1997 and is structured as a "C" corporation. On May 3, 1999
the Company reincorporated in Delaware. The consolidated financial statements
include the accounts of the Company and its wholly-owned subsidiaries. All
material intercompany accounts and transactions have been eliminated in
consolidation.

2. Summary of Significant Accounting Policies

Use of Estimates

      The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates, and such
differences could be material to the financial statements.

Revenue Recognition

      Consulting revenues are comprised of revenue from consulting fees
recognized on a time and material basis as performed.

Cash Equivalents

      Cash equivalents consist primarily of cash deposits and investments with
original maturities of ninety days or less when purchased.

Advertising Expense

      The cost of advertising is expensed as incurred. Advertising cost for the
years ended December 31, 1999 and 2000 were not material.

Property and Equipment

      Property and equipment are recorded at cost. Depreciation of property and
equipment is computed using the straight-line method over the useful lives of
the assets (generally 2 to 5 years). Leasehold improvements are amortized over
the shorter of the life of the lease or the estimated useful life of the assets.
Amortization of assets recorded under capital leases is computed using the
straight-line method over the shorter of the asset's useful life or the term of
the lease, and such amortization expense is included with depreciation expense.

Intangible Assets

      Intangible assets, primarily resulting from purchase business
combinations, are being amortized using the straight-line method over a
three-year period for excess of cost over fair value of net assets acquired.


                                      F-7


                                PERFICIENT, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Impairment of Long-Lived Assets

      The Company periodically reviews the carrying amounts of property and
equipment, identifiable intangible assets and excess of cost over fair value of
net assets acquired both purchased in the normal course of business and acquired
through acquisition to determine whether current events or circumstances, as
defined in Statement of Financial Accounting Standards No. 121, Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of,
warrant adjustments to such carrying amounts by considering, among other things,
the future cash inflows expected to result from the use of the asset and its
eventual disposition less the future cash outflows expected to be necessary to
obtain those inflows. At this time, future cash inflows exceed future cash
outflows; thus, no impairment loss has been recognized. Management reviews the
valuation and amortization periods of excess of cost over fair value of net
assets acquired on a periodic basis, taking into consideration any events and
circumstances which might result in diminished fair value or revised useful
life. No events or circumstances have occurred to warrant a diminished fair
value or reduction in the useful life of excess of cost over fair value of net
assets acquired.

Income Taxes

      The Company accounts for income taxes in accordance with Statement of
Financial Accounting Standards No. 109, Accounting for Income Taxes ("SFAS
109"). This Statement prescribes the use of the liability method whereby
deferred tax asset and liability account balances are determined based on
differences between financial reporting and tax bases of assets and liabilities
and are measured using the enacted tax rates and laws that will be in effect
when the differences are expected to reverse.

Foreign Currency Transactions

      For the Company's foreign subsidiaries, the functional currency has been
determined to be the local currency, and therefore, assets and liabilities are
translated at year end or period end exchange rates, and income statement items
are translated at average exchange rates prevailing during the year or period.
Such translation adjustments are recorded in aggregate as a component of
stockholders' equity. Gains and losses from foreign currency denominated
transactions are included in other income (expense), and were not material
during 1999 and 2000.

Segments

      The Company follows the provisions of the Statement of Financial
Accounting Standards No. 131, Disclosures about Segments of an Enterprise and
Related Information. Statement No. 131 requires a business enterprise, based
upon a management approach, to disclose financial and descriptive information
about its operating segments. Operating segments are components of an enterprise
about which separate financial information is available and regularly evaluated
by the chief operating decision maker(s) of an enterprise. Under this
definition, the Company operates as a single segment for all periods presented.

Earnings Per Share

      The Company follows the provisions of Statement of Financial Accounting
Standards No. 128, Earnings Per Share. Basic earnings per share is computed by
dividing net income (loss) available to common stockholders by the
weighted-average number of common shares outstanding during the period. Diluted
earnings per share includes the weighted average number of common shares
outstanding and the number of equivalent shares which would be issued related to
stock options, warrants, and contingently issuable common shares using the
treasury method, unless such additional equivalent shares is anti-dilutive.


                                      F-8


                                PERFICIENT, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Stock-Based Compensation

      Statement of Financial Accounting Standards No. 123, Accounting for
Stock-Based Compensation ("SFAS 123"), prescribes accounting and reporting
standards for all stock-based compensation plans, including employee stock
options. As allowed by SFAS 123, the Company has elected to account for its
employee stock-based compensation in accordance with Accounting Principles Board
Opinion No. 25, Accounting For Stock Issued To Employees, ("APB 25").

Fair Value of Financial Instruments

      Cash equivalents, accounts receivable, accounts payable, other accrued
liabilities, and debt are stated at cost which approximates fair value due to
the short-term maturity of these instruments.

Reclassification

      Certain amounts from prior periods have been reclassified to conform to
the current period presentation. Reimbursable expenses of $507,000 during 1999
are included as a component of cost of consulting revenue in the current period
presentation.

Recently Issued Accounting Standards

      The Financial Accounting Standards Board issued Statement No. 133,
Accounting For Derivative Instruments And Hedging Activities, as amended by
Statement No. 137 and Statement No. 138, which is effective for the Company's
fiscal year and quarters beginning January 1, 2001. This statement requires
companies to record derivatives on the balance sheet as assets or liabilities
measured at fair value. Gains or losses resulting from changes in the values of
those derivatives would be accounted for depending on the use of the derivative
and whether it qualifies for hedge accounting. Management believes that this
statement will not have a material impact on the Company's financial position or
results of operations because of the Company's minimal use of derivative
financial instruments.

      In December 1999, the Securities and Exchange Commission staff released
Staff Accounting Bulletin No. 101, Revenue Recognition In Financial Statements
("SAB 101"), which provides guidance on the recognition, presentation and
disclosure of revenue in financial statements. The adoption of SAB 101 did not
have a material impact on the Company's financial position or results of
operations.

      In March 2000, the Financial Accounting Standards Board issued
Interpretation No. 44, Accounting for Certain Transactions Involving Stock
Compensation, which further clarifies APB 25. Management believes that this
Interpretation will not have a material impact on the Company's financial
position or results of operations.

3. Net Income (Loss) Per Share

Computations of the net loss per share are as follows:



                                                         Year Ended December 31,
                                                      ----------------------------
                                                          1999            2000
                                                      ------------    ------------
                                                                
Net loss                                              $ (1,404,963)   $(13,627,350)

Weighted-average shares of common stock outstanding      3,000,556       5,409,353

Less common stock subject to contingency                        --        (803,070)
                                                      ------------    ------------
Shares used in computing basic net loss per share        3,000,556       4,606,283
                                                      ============    ============

                                                      ------------    ------------
Basic and diluted net loss per share                  $      (0.47)   $      (2.96)
                                                      ============    ============



                                      F-9


                                PERFICIENT, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

      Diluted net loss per share is the same as basic net loss per share, as the
effect of the assumed exercise of stock options and warrants and the issuance of
contingently issuable shares issued in business combinations, are antidilutive
due to the Company's net loss for all periods presented. Diluted net loss per
share excludes common stock equivalents of 251,750 and 1,521,699 for 1999 and
2000, respectively.

4. Concentration of Credit Risk and Significant Customers

      Cash and accounts receivable potentially expose the Company to
concentrations of credit risk. Excess cash is placed with highly rated financial
institutions. The Company provides credit, in the normal course of business, to
its customers. The Company generally does not require collateral or up front
payments. The Company performs ongoing credit evaluations of its customers and
maintains allowances for potential credit losses. Customers can be denied access
to services in the event of non-payment. One customer accounted for
approximately 97% and 11% of accounts receivable and 96% and 30% of revenues at
December 31, 1999 and 2000, and for the years then ended, respectively. A second
customer accounted for approximately 35% of accounts receivable and 25% of
revenues at December 31, 2000 and for the year then ended.

5. Employee Benefit Plan

      The Company has a qualified 401(k) profit sharing plan available to
full-time employees who meet the plan's eligibility requirements. This defined
contribution plan permits employees to make contributions up to maximum limits
allowed by the Internal Revenue Code. The Company, at its discretion, matches a
portion of the employee's contribution under a predetermined formula based on
the level of contribution and years of vesting services. The Company made
matching contributions equal to 25% of the first 6% of employee contributions
totaling $109,000 during 2000, which vest over a three year period of service.
The Company made no contributions to the plan during 1999. The Company's related
costs for the plan during 2000 were approximately $5,500 and were not
significant during 1999.

6. Common Stock and Stock Options

      During July 1999, the Company completed an initial public offering in
which the Company sold 1,000,000 shares of common stock for net proceeds to the
Company of approximately $6,300,000, after deducting the underwriters' discount
and other costs of the offering. The Company granted 100,000 fully exercisable
warrants with an exercise price of $12 per share to the underwriter of the
initial public offering.

      During February 2000, the Company completed a private placement of 400,000
shares of common stock for net proceeds to the Company of approximately
$5,258,000, after deducting costs of the offering. The Company received
approximately $90,000 of insider proceeds from certain selling shareholders
participating in the private placement. The Company granted 25,000 fully
exercisable warrants with an exercise price of $21 per share to the underwriter
of this private placement.

In May 1999, the Company's Board of Directors and stockholders approved the 1999
Stock Option/Stock Issuance Plan (the "1999 Plan"). The 1999 Plan contains
programs for (i) the discretionary granting of stock options to employees,
non-employee board members and consultants for the purchase of shares of the
Company's commons stock, (ii) the discretionary issuance of common stock
directly to eligible individuals, and (iii) the automatic issuance of stock
options to non-employee board members. The Compensation Committee of the Board
of Directors administers the 1999 Plan, and determines the exercise price and
vesting period for each grant. Options granted under the 1999 Plan have a
maximum term of 10 years.

      The Company has granted stock options to various employees under the terms
of the respective employee agreements. The stock options generally vest over
three years. The term of each option is ten years from the date of grant.

      The Company recorded $880,000 in non-cash compensation in connection with
the sale of stock that occurred in January 1999. In addition, the Company has
recorded deferred stock compensation totaling


                                      F-10


                                PERFICIENT, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

$228,000 in connection with stock options that were granted in January 1999,
representing the difference between the exercise price and the fair value of
common stock on the date of grant. Amortization of stock compensation expense
related to these options will be recognized on a straight-line basis in the
amount of approximately $19,000 per quarter over the three year vesting period
ending January 2002 for the related options. Stock compensation expense of
$956,000 and $76,000 has been recorded during the years ended December 31, 1999
and 2000, respectively.

      A summary of changes in common stock options during 1999 and 2000 is as
follows:

                                                                       Weighted-
                                                                        Average
                                                          Range of      Exercise
                                             Shares    Exercise Prices   Price
                                           ---------   --------------- ---------

Options outstanding at January 1, 1999       272,334    $0.05 - $0.60   $ 0.40
       Options granted                       272,000    $0.05 - $8.12   $ 4.25
       Options exercised                      (3,333)       $0.20       $ 0.20
       Options canceled                      (42,667)   $0.20 - $8.12   $ 3.74
                                           ---------    --------------  ------
Options outstanding at December 31, 1999     498,334    $0.05 - $8.12   $ 2.22

       Options granted                     1,553,214    $0.02 - $26.00  $10.17
       Options exercised                     (62,736)   $0.05 - $8.13   $ 0.91
       Options canceled                     (211,383)   $0.05 -$16.94   $11.03
                                           ---------    --------------  ------
Options outstanding at December 31, 2000   1,777,429    $0.02 - $26.00  $ 8.16
                                           =========    ==============  ======

Options vested, December 31, 1999            197,667    $0.05 - $8.12   $ 1.95
                                           =========    ==============  ======

Options vested, December 31, 2000            602,715    $0.02 - $14.69  $ 3.94
                                           =========    ==============  ======

      The following is additional information related to stock options
outstanding at December 31, 2000:

                        Options Outstanding            Options Exercisable
- ----------------------------------------------------   -------------------
                                          Weighted
                              Weighted     Average               Weighted
   Range of                   Average     Remaining               Average
   Exercise                   Exercise   Contractual             Exercise
    Prices        Options      Price        Life       Options    Price
- --------------    ---------   --------      ----       -------     -----
 $0.02 - $0.50      345,074   $   0.37      7.94       266,866     $0.35
 $3.36 - $4.00      430,229   $   3.40      9.29       199,182     $3.39
$7.50 - $12.97      565,574   $  10.84      9.44        75,000     $9.33
$13.25 - $26.00     436,552   $  15.55      9.20        61,667    $14.69
- --------------    ---------   --------      ----       -------     -----
$0.02 - $26.00    1,777,429   $   8.16      9.06       602,715     $3.94
==============    =========   ========      ====       =======     =====


                                      F-11


                                PERFICIENT, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

      Pro forma information regarding net income is required by SFAS 123, and
has been determined as if the Company had accounted for its employee stock
options granted under the fair value method prescribed by SFAS 123. The fair
value for these options was estimated at the date of grant using the
Black-Scholes pricing model with the following weighted-average assumptions:

                                                      Year Ended December 31,
                                                      -----------------------
                                                        1999            2000
                                                      -------         -------
Risk-free interest rate                                 6.00%           6.00%
Dividend yield                                          0.00%           0.00%
Weighted-average expected life of options             5 years         5 years
Expected volatility                                    0.622           0.870

      For purposes of pro forma disclosures, the estimated fair value of the
options is amortized to expense over the options' vesting period. The Company's
pro forma information follows:

                                                      Year Ended December 31,
                                                   ----------------------------
                                                       1999            2000
                                                   ------------    ------------
Pro forma compensation expense                     $     63,748    $  1,098,153
Pro forma net loss                                 $ (1,468,711)   $(14,725,503)
Pro forma net loss per share - basic and diluted   $      (0.49)   $      (3.20)

      At December 31, 1999 and 2000, the weighted-average remaining contractual
life of outstanding options was 8.92 and 9.06 years, respectively. The
weighted-average grant-date fair value of options granted during 1999 and 2000
at market prices was approximately $1.60 and $9.13, respectively, and at below
market prices was approximately $5.40 during 1999.

      At December 31, 1999 and 2000, 2,150,000 and 2,051,197 shares of common
stock were reserved for future issuance (at December 31, 2000 1,922,447 shares
were reserved for options and 128,750 shares were reserved for warrants) and
1,651,666 and 145,018 options were available for future grants, respectively.

7. Line of Credit and Long Term Debt

      The Company has a line of credit facility providing up to $6,000,000,
subject to certain borrowing base calculations as defined. Borrowings under this
agreement, which expires June 29, 2001, bear interest at the bank's prime rate
plus 0.85%. (10.35% at December 31, 2000). The Company is required to maintain
certain financial covenants under this agreement. The line of credit is
collateralized by substantially all the assets of the Company. Commencing on
December 31, 2000, the Company must pay a fee equal to .07% of the unused
portion of the committed line of credit.

      The Company amended the line of credit facility in December 2000 to
provide for a $750,000 maximum available equipment line of credit, subject to
financial covenants and borrowing base calculations as defined. Draws on the
equipment line of credit bear interest at prime rate plus 1.5%, and advances are
payable in 36 equal monthly installments of principal plus accrued interest. No
amounts had been borrowed under the equipment line of credit as of December 31,
2000.

      On July 1, 1999, the Company had entered into an agreement with a bank to
borrow up to $1,000,000 against qualified accounts receivables with full
recourse. Under the contract, the bank would purchase the accounts receivable
under the following terms: 80% of the balance is remitted at the sale date, the
rest is remitted upon receipt of the balance due from the customer less finance
and administrative fees charged by the bank. The agreement had a one-year term
and borrowings under the agreement bore interest at the bank's prime rate. In
connection with this agreement, the Company issued warrants to the bank to
purchase 3,750 shares at the initial public offering price of $8 per share. As
the effect of the warrants is not material to the financial statements, the
Company has not discounted the line of credit to separately account for the


                                      F-12


                                PERFICIENT, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

warrants. This agreement expired in June 2000.

      Notes payable to related party consists of: a $162,000 non interest
bearing note payable to the shareholders of Core Objective, Inc. ("Core
Objective") representing the note payable portion of the purchase consideration
in the acquisition of Core Objective and is payable in May 2001; and $63,000 of
notes payable to certain shareholders of Core Objective, Inc. assumed in the
purchase of Core Objective, which were paid in February 2001.

      Notes payable consists of term debt with a bank for the purchase of
equipment, assumed in the purchase of Core Objective. This note bears interest
at the bank's prime rate plus 1.5%. The note is payable in monthly principal
installments of approximately $280 plus interest. The future annual principal
payments are as follows: $3,338 in 2001, $3,338 in 2002, $3,338 in 2003, and
$556 in 2004.

8. Income Taxes

      As of December 31, 2000, the Company had tax net operating loss carry
forwards of approximately $571,000 that will begin to expire in 2019 if not
utilized.

      Utilization of net operating losses may be subject to an annual limitation
due to the "change in ownership" provisions of the Internal Revenue Code of
1986. The annual limitation may result in the expiration of net operating losses
before utilization.

      Significant components of the provision for income taxes attributable to
continuing operations are as follows:

                                                1999               2000
                                              ---------          ---------
      Current:
        Federal                               $ (17,661)         $      --
        Foreign                                      --            175,000
        State                                    (1,558)                --
                                              ---------          ---------
      Total current                             (19,219)           175,000
                                              ---------          ---------
      Deferred:
        Federal                                  (1,583)                --
        Foreign                                      --                 --
        State                                      (110)                --
                                              ---------          ---------
      Total deferred                             (1,693)                --
                                              ---------          ---------
                                              $ (20,912)         $ 175,000
                                              =========          =========


                                      F-13


                                PERFICIENT, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

      Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. Significant components of
the Company's deferred taxes as of December 31, 1999 and 2000 are as follows:

                                                          1999           2000
                                                       ---------      ---------
Deferred tax liabilities:
  Deferred income                                      $      --      $(265,845)
  Depreciable assets                                      (9,985)            --
                                                       ---------      ---------
Total deferred tax liabilities                            (9,985)      (265,845)
                                                       ---------      ---------
Deferred tax assets:
  Depreciable assets                                          --          3,595
  Tax carryforwards                                      101,265        211,125
  Bad debt                                                25,181        215,475
  Stock compensation                                      28,121         56,242
  Accrued liabilities and other                           17,364         49,404
                                                       ---------      ---------
Total deferred tax assets                                171,931        535,841

Valuation allowance for deferred tax assets             (161,946)      (269,996)
                                                       ---------      ---------
Net deferred tax assets
                                                           9,985        265,845
                                                       ---------      ---------
Net deferred taxes                                     $      --      $      --
                                                       =========      =========

      The Company has established a valuation allowance equal to the net
deferred tax assets due to uncertainties regarding the realization of deferred
tax assets based on the Company's lack of earnings history. The valuation
allowance increased by approximately $162,000 and $108,000 during 1999 and 2000,
respectively. As of December 31, 2000, approximately $175,000 of the valuation
allowance relates to tax benefits for stock option deductions included in the
net operating loss carryforward, which when realized, will be allocated directly
to contributed capital to the extent the benefits exceed amounts attributable to
deferred compensation expense.


                                      F-14


                                PERFICIENT, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

      Undistributed earnings of the Company's foreign subsidiary are considered
to be permanently reinvested and, accordingly, no provision for US federal
and/or state income taxes has been provided thereon.

      The Company's provision for income taxes differs from the expected tax
expense (benefit) amount computed by applying the statutory federal income tax
rate of 34% to income before income taxes as a result of the following:

                                                     1999              2000
                                                  -----------       -----------

Tax at statutory rate of 34%                      $  (472,897)      $(4,573,803)
State taxes, net of federal benefit                   (14,798)          (21,676)
Goodwill                                                   --         4,400,134
Effect of foreign operations                               --            63,659
Stock based compensation                              299,200                --
Permanent items                                         5,638            39,352
Change in deferred items                              161,945           287,481
Other                                                      --           (20,147)
                                                  -----------       -----------
                                                  $   (20,912)      $   175,000
                                                  ===========       ===========

9. Commitments And Contingencies

      The Company leases its office facilities and equipment under various
operating and capital lease agreements. The Company has the option to extend the
term of certain of its office facilities leases. Future minimum commitments
under these lease agreements are as follows:

                                                    Capital     Operating
                                                    Leases        Leases
                                                  ----------    ----------
      2001                                        $  115,214    $  852,780
      2002                                            44,347       465,359
      2003                                             5,219       182,293
      2004                                                --        10,473

                                                  ----------    ----------
      Total minimum lease payments                $  164,780    $1,510,905
                                                                ==========
      Less amount representing interest              (10,671)
                                                  ----------
      Present value of minimum lease payments        154,109
      Less current portion                            81,415
                                                  ----------
      Long-term capital lease obligation          $   72,694
                                                  ==========

      Rent expense for the years ended December 31, 1999 and 2000 was $88,666
and $798,000, respectively.

      In addition, the Company has entered into a sublease with a related party
for office rent. The lease agreement with the related party was on a
month-to-month basis during 1999 and through March 2000, and in November 2000 a
new agreement was entered into for a three period. During the years ended
December 31, 1999 and 2000, the Company recorded combined rent expense of
$88,666 and $24,000, respectively, under these agreements.


                                      F-15


                                PERFICIENT, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

10. Business Combinations

      On January 3, 2000, the Company acquired LoreData, Inc. ("LoreData"). The
Company acquired LoreData for an aggregate purchase price of approximately $2.4
million, subject to certain post-closing adjustments. The aggregate purchase
price of $2.4 million consisted of: (1) $385,000 in cash that was paid at
closing, (2) 30,005 shares of our common stock, also paid at closing, and (3)
131,709 shares of common stock that were held in escrow until January 2001. The
acquisition was accounted for as a purchase business combination. The excess of
purchase price over fair value of the net assets was recorded as goodwill ($2.3
million), and is being amortized using the straight-line method over the
estimated useful life of three years. As of December 31, 2000, accumulated
amortization of goodwill related to the LoreData acquisition was approximately
$792,000.

      On May 1, 2000, the Company acquired all the outstanding shares and
assumed all outstanding options of Compete, Inc. ("Compete"). Compete provided
specialized consulting services for IBM's WebSphere and Visual Age product
lines. The aggregate purchase price of Compete consisted of (1) $3,425,000 in
cash, (2) $2,527,500 in non interest bearing promissory notes to be repaid
within six months following the closing, (3) 2,003,866 shares of common stock,
of which 1,001,933 shares are subject to adjustment or forfeiture and which are
being held in escrow, and (4) the assumption of Compete's outstanding employee
options. The total cost of the acquisition, including the assumption of
outstanding options and transaction costs, is as follows (in thousands):

              Cash .....................................   $ 3,425
              Note (less imputed interest of $107.5) ...     2,420
              Common stock .............................    40,077
              Assumption of existing stock option plan .     8,278
              Transaction broker fees ..................       694
              Transaction costs ........................       325
                                                           -------
                   Total purchase price ................   $55,219
                                                           =======

      The acquisition was accounted for as a purchase business combination.
Accordingly, the results of operations of Compete have been included with those
of the Company for periods subsequent to the date of acquisition. The excess of
purchase price over fair value of the net assets was recorded as goodwill ($54.4
million), and is being amortized using the straight-line method over the
estimated useful life of three years. As of December 31, 2000, accumulated
amortization of goodwill related to the Compete acquisition was approximately
$12,054,000.

      The unaudited pro forma combined results of operations of Perficient,
LoreData, and Compete for the years ended December 31, 1999 and 2000 after
giving effect to certain pro forma adjustments as if the transaction had
occurred at the beginning of each period are as follows:

                                                         For the year ended
                                                           December 31,
                                                   ----------------------------
                                                       1999            2000
                                                   ------------    ------------
Revenues                                           $  9,710,818    $ 23,110,578
Operating loss                                     $(20,008,666)   $(18,996,278)
Net loss                                           $(20,045,520)   $(19,325,316)
Basic and diluted pro forma net loss per share     $      (4.97)   $      (3.91)

      The unaudited pro forma results are not necessarily indicative of the
actual results of operations that would have occurred had the acquisitions of
Compete and LoreData occurred on January 1, 1999 or of future results.


                                      F-16


                                PERFICIENT, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

      On November 17, 2000, the Company acquired Core Objective, Inc. ("Core
Objective"), a Canadian corporation. Core Objective was a consulting firm
specializing in object oriented design and development of software for Fortune
2000 companies. The Company acquired Core Objective for an aggregate purchase
price of approximately $1,940,000, consisting of cash, a note payable due six
months from the purchase date, 107,526 shares of common stock (of which 53,763
are being held in escrow for a one year period) and the assumption of
outstanding options. The acquisition was accounted for as a purchase business
combination. Accordingly, the results of operations of Core Objective have been
included with those of the Company for periods subsequent to the date of
acquisition. The excess of purchase price over fair value of the net assets was
recorded as goodwill ($1,820,000), and is being amortized using the
straight-line method over the estimated useful life of three years. As of
December 31, 2000, accumulated amortization of goodwill related to the Compete
acquisition was approximately $96,000.


                                      F-17


                                PERFICIENT, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

11.        Segments of Business and Geographic Area Information

      The Company considers its business activities to constitute a single
segment of business. A summary of the Company's operations by geographic area
follows:

                                                    Year ended December 31,
                                               --------------------------------
                                                    1999               2000
                                               ------------        ------------
Revenue:
  United States                                $  2,647,878        $ 18,225,081
  Canada                                                 --             139,889
  United Kingdom                                         --           1,598,789
                                               ------------        ------------
    Total revenue                              $  2,647,878        $ 19,963,759
                                               ============        ============
Net income (loss):
  United States                                $ (1,404,963)       $(13,655,040)
  Canada                                                 --              30,808
  United Kingdom                                         --              (3,118)
                                               ------------        ------------
    Total net income (loss)                    $ (1,404,963)       $(13,627,350)
                                               ============        ============
Identifiable assets:
  United States                                $  6,616,417        $ 53,225,351
  Canada                                                 --             339,760
  United Kingdom                                         --           1,049,831
                                               ------------        ------------
    Total identifiable assets                  $  6,616,417        $ 54,614,942
                                               ============        ============


                                      F-18

EX-10.20

                                                                   Exhibit 10.20

                                STATEMENT OF WORK

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

      1.0 SCOPE OF WORK

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

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

      2.0 DESCRIPTION OF DELIVERABLES AND SERVICES

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

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

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

      3 EDUCATION AND TRAINING

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


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


                                  Page 1 of 7


                                STATEMENT OF WORK

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


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

      4 SUPPLIER RESPONSIBILITIES

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

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

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

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

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

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

5 BUYER RESPONSIBILITIES

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


                                  Page 2 of 7


                                STATEMENT OF WORK

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

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

6 EXHIBIT VIII

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

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

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

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

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

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

7 SCHEDULE

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


                                  Page 3 of 7


                                STATEMENT OF WORK

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

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

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

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

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

8 PAYMENTS

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

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

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

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

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


                                  Page 4 of 7


                                STATEMENT OF WORK

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

9 COMMUNICATIONS

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

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

      10 INVOICING INSTRUCTIONS

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

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

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

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

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

      11 MODIFICATIONS TO AGREEMENT 4900CS0965

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

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


                                  Page 5 of 7


                                STATEMENT OF WORK

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

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

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

      12 RIGHT OF FIRST OFFER

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

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

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

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

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

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


                                  Page 6 of 7


                                STATEMENT OF WORK

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

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

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

ACCEPTED AND AGREED TO:                  ACCEPTED AND AGREED TO:

IBM                                      Perficient Inc.


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

Buyer's Name


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


IBM Customer Solutions and
General Procurement


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


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


                                  Page 7 of 7

EX-10.21

                                                                   Exhibit 10.21

                              EMPLOYMENT AGREEMENT

            THIS EMPLOYMENT AGREEMENT dated January 3, 2001 and effective as of
October 30, 2000, between Perficient, Inc., a Delaware corporation (the
"Company"), and John T. McDonald ("Employee").

                                   WITNESSETH:

            WHEREAS, the Company desires that Employee continue to be employed
by it and render services to it, and Employee is willing to be so employed and
to render such services to the Company, all upon the terms and subject to the
conditions contained herein.

            NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:

            1. EMPLOYMENT. Subject to and upon the terms and conditions
contained in this Agreement, the Company hereby agrees to continue to employ
Employee and Employee agrees to continue in the employ of the Company, for the
period set forth in Paragraph 2 hereof, to render to the Company, its affiliates
and/or subsidiaries the services described in Paragraph 3 hereof.

            2. TERM. Employee's term of employment under this Agreement shall be
two years, commencing as of the date hereof and continuing through and including
December 31, 2002, unless extended in writing as provided below or earlier
terminated pursuant to the terms and conditions set forth herein (the
"Employment Term").

            3. DUTIES.

                  (a) Employee shall serve as Chief Executive Officer of the
Company at the discretion of the Board of Directors of the Company. Employee
shall perform all duties and services incident to the positions held by him.

                  (b) Employee agrees to abide by all By-laws and policies of
the Company promulgated from time to time by the Company.



            4. EXCLUSIVE SERVICES AND BEST EFFORTS. Employee agrees to devote
his best efforts, energies and skill to the discharge of the duties and
responsibilities attributable to his position.

            5. COMPENSATION.

                  (a) As compensation for his services and covenants hereunder,
Employee shall receive a salary ("Salary"), payable pursuant to the Company's
normal payroll procedures in place from time to time, at the rate of $189,000
per annum, less all necessary and required federal, state and local payroll
deductions. Employee shall be entitled to receive salary increases as may be
determined from time to time by the Board of Directors of the Company.

                  (b) Employee shall be entitled to a bonus of $75,000 if net
revenue for the year ending December 21, 2001 (on a pro forma basis, giving
effect to acquisitions during the year as if they had occurred on January 1,
2001) is $50 million or more and the Company has a net profit.

                  (c) In addition, Employee shall be entitled to receive such
bonuses as may be determined from time to time by the Board of Directors of the
Company and shall be eligible to receive stock options entitling Employee to
acquire shares of Common Stock under the Company's 1999 Stock Option/Stock
Issuance Plan, pursuant to the policies of the Company from time to time to
generally make available stock options, to executive employees. As further
consideration for the agreements and covenants hereunder, the Company shall,
within 120 days of the effective date of this Agreement, grant to the Employee
an option to purchase 100,000 shares of Common Stock of the Company, exercisable
at the closing price of the Common Stock on the date immediately preceding the
date of grant . Notwithstanding anything to the contrary in any stock option
agreement between Employee and the Company, all stock options granted to
Employee shall continue to vest in accordance with their schedule and shall not
terminate if Employee ceases to be an employee of the Company as long as
Employee continues to serve as an officer, director or consultant of the
Company.

            6. BUSINESS EXPENSES. Employee shall be reimbursed for, and entitled
to advances (subject to repayment to the Company if not actually incurred by
Employee) with respect to those business expenses incurred by him which are
reasonable and necessary for Employee to perform his duties under this Agreement
in accordance with policies established from time to time by the Company.


                                       2


            7. EMPLOYEE BENEFITS.

                  (a) During the Employment Term, Employee shall be entitled to
such insurance, disability and health and medical benefits and be entitled to
participate in such retirement plans or programs as are from time to time
generally made available to executive employees of the Company pursuant to the
policies of the Company; PROVIDED THAT Employee shall be required to comply with
the conditions attendant to coverage by such plans and shall comply with and be
entitled to benefits only in accordance with the terms and conditions of such
plans. The Company may withhold from any benefits payable to Employee all
federal, state, local and other taxes and amounts as shall be permitted or
required to be withheld pursuant to any applicable law, rule or regulation.

                  (b) Employee shall be entitled to vacation in accordance with
the Company's policy in effect for executive staff, which shall be taken at such
time or times as shall be mutually agreed upon with the Company.

            8. DEATH AND DISABILITY.

                  (a) The Employment Term shall terminate on the date of
Employee's death, in which event Employee's Salary, reimbursable expenses and
benefits owing to Employee through the date of Employee's death shall be paid to
his estate. Employee's estate will not be entitled to any other compensation
upon termination of this Agreement pursuant to this subparagraph 8(a).

                  (b) The Employment term shall terminate upon Employee's
Disability. For purposes of this Agreement, "Disability" shall mean a physical
or mental disability or infirmity that prevents the material performance by
Employee of his duties hereunder lasting for a continuous period of six months
or longer. The reasoned and good faith judgment of the Company's Board of
Directors as to Disability shall be based on such competent medical evidence as
shall be presented to it by Employee or by any physician or group of physicians
or other competent medical experts employed by Employee or the Company to advise
the Company's Board of Directors. In case of such termination, Employee shall be
entitled to receive his Salary, reimbursable expenses and benefits owing to
Employee through the date of termination. In addition, the Company shall pay to
Employee, within 60 days of the date of Employee's termination, in a lump-sum,
an amount equal to Employee's then annual Salary. Employee will not be entitled
to any other compensation upon termination of his employment pursuant to this
subparagraph 8(b).

            9. TERMINATION.

                  (a) The Company shall have the right, upon delivery of written
notice to the Employee, to terminate the Employee's employment hereunder prior
to the expiration of the Employment Term (i) pursuant to a Termination for Cause
or (ii) pursuant to a Without Cause Termination (all as defined below). The
Employee shall have the right, upon delivery of written


                                       3


notice to the Company, to terminate his employment hereunder prior to the
expiration of the Employment Term by providing the Company with not less than 30
days prior written notice.

                  (b) In the event that the Company terminates the Employee's
employment pursuant to a Without Cause Termination, the Company shall make a
lump-sum payment to the Employee in an amount equal to the lesser of (i) three
months Salary or (ii) the amount of Salary payable during the remaining term of
this Agreement, and shall pay Employee his reimbursable expenses and benefits
owing to Employee through the day on which Employee is terminated. No other
payments shall be made, or benefits provided, by the Company under this
Agreement in the event of a Without Cause Termination.

                  (c) In the event that the Company terminates the Employee's
employment hereunder due to a Termination for Cause or the Employee terminates
employment with the Company, the Company shall be released from any and all
further obligations under this Agreement, except that the Company shall be
obligated to pay Employee his Salary, reimbursable expenses and benefits owing
to Employee through the day on which Employee is terminated. Employee will not
be entitled to any other compensation upon termination of this Agreement
pursuant to this Paragraph 9(c).

                  (d) For purposes of this Agreement, the following terms have
the following meanings:

                  (i) The term "Termination for Cause" means, to the maximum
extent permitted by applicable law, a termination of the Employee's employment
by the Company attributed to (a) the repeated willful failure of Employee
substantially to perform his duties hereunder (other than any such failure due
to physical or mental illness) that has not been cured reasonably promptly after
a written demand for substantial performance is delivered to Employee by the
Company's Board of Directors, which demand identifies the manner in which the
Company's Board of Directors believes that Employee has not substantially
performed his duties hereunder; (b) conviction of, or entering a plea of nolo
contendere to, a crime that constitutes a felony; (c) Employee's engaging in
conduct that is intentional or grossly negligent that results in material injury
to the Company; or (d) the material breach by Employee of any written covenant
or agreement with the Company under this Agreement or otherwise, including, but
not limited to, an agreement not to disclose any information pertaining to the
Company or not to compete with the Company, including (without limitation) the
covenants and agreements contained in paragraph 11 hereof.

                  (ii) The term "Without Cause Termination" means a termination
of the Employee's employment by the Company other than due to (a) a Termination
for Cause, (b) Disability, (c) the Employee's death, or (d) the expiration of
this Agreement.

            10. CHANGE IN CONTROL - TERMINATION OF EMPLOYMENT AND COMPENSATION
IN EVENT OF TERMINATION.


                                       4


                  (a) After a Change in Control (as defined below) of the
Company has occurred, if either Employee terminates his employment within six
(6) months after he has obtained actual knowledge of the Change in Control or
the Company (or any successor thereto) terminates Employee's employment with the
Company after the Change in Control, Employee shall be entitled to receive a
lump-sum payment (the "Termination Compensation"), in cash, on the Termination
Date, in an amount equal to three months of Employee's then annual Salary. In
addition, and notwithstanding anything contained in any other agreement,
including any stock option agreement between the Company and the Employee,
immediately prior to a Change of Control, any and all options, agreements or
rights to purchase securities of the Company granted to the Employee shall vest
in their entirety, regardless of the satisfaction of any conditions contained
therein.

                  (b) For purposes hereof, a "Change In Control" shall be deemed
to have occurred if: (i) any "person" or "group" (as such terms are used in
Sections 3(a)(9) and 13(d)(3) of the Securities Exchange Act of 1934, as amended
(the " Act")) becomes a "beneficial owner" (as such term is used in Rule13d-3
promulgated under the Act), after the date hereof, directly or indirectly, of
securities of the Company representing 50% or more of the combined voting power
of the Company's then outstanding securities; (ii) a change in "control" of the
Company (as the term "control" is defined in Rule 12b-2 under the act or any
successor rule promulgated under the Act) shall have occurred; (iii) the
stockholders of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the Company of all or
substantially all of the Company's assets; or (iv) the stockholders of the
Company approve a merger or consolidation of the Company with any other company,
other than a merger or consolidation which would result in the combined voting
power of the Company's voting securities outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) more than 50% of the combined
voting power of the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation. Notwithstanding the
foregoing, any transaction involving a leveraged buyout or other acquisition of
the Company which would otherwise constitute a Change in Control, in which
Employee participates in the surviving or successor entity (other than solely as
an employee or consultant), shall not constitute a Change in Control.

            11. DISCLOSURE OF TRADE SECRETS AND OTHER PROPRIETARY INFORMATION;
RESTRICTIVE COVENANTS.

                  (a) Employee acknowledges that he is bound by the terms of the
Company's Confidentiality and Intellectual Property Agreement.

                  (b) Employee will not, during the term of this Agreement,
directly or indirectly, as an employee, employer, consultant, agent, principal,
partner, manager, stockholder, officer, director, or in any other individual or
representative capacity, engage in or participate in any business that is
competitive with the business of providing virtual professional services
organizations to Internet service corporations. The ownership by Employee of 5%
or less of the


                                       5


issued and outstanding shares of a class of securities which is traded on a
national securities exchange or in the over-the-counter market, shall not cause
Employee to be deemed a shareholder under this subparagraph 11(b) or constitute
a breach of this subparagraph 11(b). In addition, the ownership by Beekman
Ventures, Inc. or any affiliate of Beekman Ventures, Inc. or any stockholder,
officer, director or agent of Beekman Ventures, Inc. ("BV") in connection with
the activities of BV as a venture capital firm, and the services provided by
Employee to BV in connection with, any investment in any private or public
company shall not be deemed to be a breach of any of the provisions of this
Agreement and of this paragraph (b) of this Agreement .

                  (c) Employee will not, during the term of this Agreement and
for a period of 24 months thereafter, directly or indirectly, work as an
employee, employer, consultant, agent, principal, partner, manager, stockholder,
officer, director, or in any other individual or representative capacity for any
person or entity who or which was competitive with the business of providing
virtual professional services organizations to Internet service corporations
during the term of Employee's employment with the Company. The ownership by
Employee of 5% or less of the issued and outstanding shares of a class of
securities which is traded on a national securities exchange or in the
over-the-counter market, shall not cause Employee to be deemed a shareholder
under this subparagraph 11(c) or constitute a breach of this subparagraph 11(c).
Employee's participation as a director or advisor in a company or other business
enterprise in which BV has an interest shall not be deemed to be a violation of
this Agreement.

                  (d) Employee will not, during the term of this Agreement and
for a period of 24 months thereafter, on his behalf or on behalf of any other
business enterprise, directly or indirectly, under any circumstance other than
at the direction and for the benefit of the Company, (i) solicit for employment
any person who was employed by the Company or any of its subsidiaries or
affiliates during Employee's employment with the Company, or (ii) call on,
solicit, or take away any person or entity who or which was a customer of the
Company or any of its subsidiaries or affiliates during Employee's employment
with the Company for a business that is competitive with the business of
providing virtual professional services organizations to Internet service
corporations..

                  (e) It is expressly agreed by Employee that the nature and
scope of each of the provisions set forth above in this Paragraph 11 are
reasonable and necessary. If, for any reason, any aspect of the above provisions
as it applies to Employee is determined by a court of competent jurisdiction to
be unreasonable or unenforceable, the provisions shall only be modified to the
minimum extent required to make the provisions reasonable and/or enforceable, as
the case may be. Employee acknowledges and agrees that his services are of
unique character and expressly grants to the Company or any subsidiary or
affiliate of the Company or any successor of any of them, the right to enforce
the above provisions through the use of all remedies available at law or in
equity, including, but not limited to, injunctive relief.

                  (f) This Paragraph 11 and Paragraphs 12 and 13 hereof (and
Paragraphs 14 through 19 hereof as they may apply to such Paragraphs) shall
survive the expiration or termination of this Agreement for any reason.


                                       6


            12. COMPANY PROPERTY.

                  (a) Any patents, inventions, discoveries, applications or
processes designed, devised, planned, applied, created, discovered or invented
by Employee in the course of Employee's employment under this Agreement and
which pertain to any aspect of the Company's or its subsidiaries' or affiliates'
business as described above shall be the sole and absolute property of the
Company, and Employee shall promptly report the same to the Company and promptly
execute any and all documents that may from time to time reasonably be requested
by the Company to assure the Company the full and complete ownership thereof.

                  (b) All records, files, lists, including computer generated
lists, drawings, documents, equipment and similar items relating to the
Company's business which Employee shall prepare or receive from the Company
shall remain the Company's sole and exclusive property. Upon termination of this
Agreement, Employee shall promptly return to the Company all property of the
Company in his possession. Employee further represents that he will not copy or
cause to be copied, print out or cause to be printed out any software, documents
or other materials originating with or belonging to the Company. Employee
additionally represents that, upon termination of his employment with the
Company, he will not retain in his possession any such software, documents or
other materials.

            13. EQUITABLE RELIEF. It is mutually understood and agreed that
Employee's services are special, unique, unusual, extraordinary and of an
intellectual character giving them a peculiar value, the loss of which cannot be
reasonably or adequately compensated in damages in an action at law.
Accordingly, in the event of any breach of this Agreement by Employee,
including, but not limited to, the breach of any of the provisions of Paragraphs
11 or 12 hereof, the Company shall be entitled to equitable relief by way of
injunction or otherwise in addition to any damages which the Company may be
entitled to recover. In addition, the Company shall be entitled to reimbursement
from Employee, upon request, of any and all reasonable attorneys' fees and
expenses incurred by it in enforcing any term or provision of this Agreement.

            14. CONSENT TO TEXAS JURISDICTION AND VENUE. The Employee hereby
consents and agrees that state courts located in Travis County, Texas and the
United States District Court for the Western District of Texas each shall have
personal jurisdiction and proper venue with respect to any dispute between the
Employee and the Company. In any dispute with the Company, the Employee will not
raise, and hereby expressly waives, any objection or defense to any such
jurisdiction as an inconvenient forum.

            15. NOTICE. Except as otherwise expressly provided, any notice,
request, demand or other communication permitted or required to be given under
this Agreement shall be in writing, shall be sent by one of the following means
to the Employee at his address set forth on the signature page of this Agreement
and to the Company at its address set forth on the signature page of this
Agreement, Attention: John A. Hinners (or to such other address as shall


                                       7


be designated hereunder by notice to the other parties and persons receiving
copies, effective upon actual receipt), and shall be deemed conclusively to have
been given: (a) on the first business day following the day timely deposited
with Federal Express (or other equivalent national overnight courier) or United
States Express Mail, with the cost of delivery prepaid or for the account of the
sender; (b) on the fifth business day following the day duly sent by certified
or registered United States mail, postage prepaid and return receipt requested;
or (c) when otherwise actually received by the addressee on a business day (or
on the next business day if received after the close of normal business hours or
on any non-business day).

            16. INTERPRETATION; HEADINGS. The parties acknowledge and agree that
the terms and provisions of this Agreement have been negotiated, shall be
construed fairly as to all parties hereto, and shall not be construed in favor
of or against any party. The section headings contained in this Agreement are
for reference purposes only and shall not affect the meaning or interpretation
of this Agreement.

            17. SUCCESSORS AND ASSIGNS; ASSIGNMENT; INTENDED BENEFICIARIES.
Neither this Agreement, nor any of Employee's rights, powers, duties or
obligations hereunder, may be assigned by Employee. This Agreement shall be
binding upon and inure to the benefit of Employee and his heirs and legal
representatives and the Company and its successors. Successors of the Company
shall include, without limitation, any corporation or corporations acquiring,
directly or indirectly, all or substantially all of the assets of the Company,
whether by merger, consolidation, purchase, lease or otherwise, and such
successor shall thereafter be deemed "the Company" for the purpose hereof.

            18. NO WAIVER BY ACTION. Any waiver or consent from the Company
respecting any term or provision of this Agreement or any other aspect of the
Employee's conduct or employment shall be effective only in the specific
instance and for the specific purpose for which given and shall not be deemed,
regardless of frequency given, to be a further or continuing waiver or consent.
The failure or delay of the Company at any time or times to require performance
of, or to exercise any of its powers, rights or remedies with respect to, any
term or provision of this Agreement or any other aspect of the Employee's
conduct or employment in no manner (except as otherwise expressly provided
herein) shall affect the Company's right at a later time to enforce any such
term or provision.

            19. COUNTERPARTS; TEXAS GOVERNING LAW; AMENDMENTS; ENTIRE AGREEMENT.
This Agreement may be executed in two counterpart copies, each of which may be
executed by one of the parties hereto, but all of which, when taken together,
shall constitute a single agreement binding upon all of the parties hereto. This
Agreement and all other aspects of the Employee's employment shall be governed
by and construed in accordance with the applicable laws pertaining in the State
of Texas (other than those that would defer to the substantive laws of another
jurisdiction). Each and every modification and amendment of this Agreement shall
be in writing and signed by the parties hereto, and any waiver of, or consent to
any departure from, any term or provision of this Agreement shall be in writing
and signed by each affected party hereto. This Agreement contains the entire
agreement of the parties and


                                       8


supersedes all prior representations, agreements and understandings, oral or
otherwise, between the parties with respect to the matters contained herein.

                            [Signature page follows.]


                                       9


            IN WITNESS WHEREOF, the parties have executed this Employment
Agreement as of the date first above written.

                                        PERFICIENT, INC.


                                        By: /s/ JOHN A. HINNERS
                                            ----------------------------------
                                        Name: John A. Hinners
                                        Title: Chief Financial Officer


                                        /s/ JOHN T. MCDONALD
                                        --------------------------------------
                                        John T. McDonald, Individually


                                       10

EX-21

                                   Exhibit 21
                                  Subsidiaries

The following are the direct and indirect subsidiaries of Perficient, Inc.

Perficient LoreData, Inc.                                     Delaware
Perficient Compete, Inc.                                      Delaware
Perficient International, Ltd.                                United Kingdom
Perficient Canada, Inc.                                       Canada
Core Objective, Inc.                                          Canada

Perficient LoreData, Inc. was merged and continued under Perficient, Inc. as of
June 5, 2000. Perficient Compete, Inc. was merged and continued under
Perficient, Inc. as of December 31, 2000.


                                      II-1

EX-23.1

                                                                    Exhibit 23.1

                         CONSENT OF INDEPENDENT AUDITORS

      We consent to the incorporation by reference in the Registration Statement
(Form S-8 No. 333-44854) pertaining to the Perficient, Inc. 401(k) Employee
Savings Plan, the Registration Statement (Form S-8 No. 333-42626) pertaining to
the Perficient, Inc. 1999 Stock Option/Stock Issuance Plan and the Registration
Statement (Form S-3 No. 333-42624) of our report dated January 25, 2001, with
respect to the consolidated financial statements of Perficient, Inc. and
Subsidiaries included in the Annual Report (Form 10-KSB) for the year ended
December 31, 2000.


/s/ Ernst & Young LLP

Austin, Texas
March 28, 2001


                                      II-2