STOCK PURCHASE AGREEMENT

                                      AMONG

                            RESEARCH ENGINEERS, INC.

                            R-CUBE TECHNOLOGIES, INC.

                                       AND

                            SRINIVASA REDDY MALIREDDY


                                   DATED AS OF

                                JANUARY 18, 1999


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                                TABLE OF CONTENTS

      DESCRIPTION                                                      PAGE NO.
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      1.    PURCHASE AND SALE OF SHARES......................................1
            1.1   Purchase and Sale. ........................................1
            1.2   Purchase Price. ...........................................1
            1.3   Adjustment to Purchase Price. .............................1
            1.4   Payment of Purchase Price. ................................1
            1.5   Review of Final Balance Sheet. ............................2

      2.    REPRESENTATIONS AND WARRANTIES OF R-CUBE AND SELLERS.............2
            2.1   Organization; Good Standing; Qualification and Power. .....2
            2.2   Capital Structure..........................................3
                  2.2.1 Stock. ..............................................3
                  2.2.2 No Other Commitments. ...............................3
            2.3   Authority..................................................3
                  2.3.1 Corporate Action. ...................................3
                  2.3.2 Sellers' Authority. .................................3
                  2.3.3 No Conflict. ........................................3
                  2.3.4 Governmental Consents. ..............................4
            2.4   Financial Statements. .....................................4
            2.5   Compliance with Applicable Laws. ..........................4
            2.6   Insurance. ................................................4
            2.7   Litigation. ...............................................5
            2.8   Employee Benefits..........................................5
            2.9   Absence of Undisclosed Liabilities. .......................6
            2.10  Absence of Certain Changes or Events. .....................6
            2.11  No Defaults. ..............................................7
            2.12  Certain Agreements. .......................................7
            2.13  Taxes......................................................8
            2.14  Intellectual Property. ...................................10
            2.15  Fees and Expenses. .......................................10
            2.16  Environmental Matters.....................................10
            2.17  [Intentionally Omitted]. .................................10
            2.18  Disclosure. ..............................................10
            2.19  Restrictions on Business Activities. .....................10
            2.20  Accounts Receivable.......................................10
            2.21  Personal Property. .......................................11
            2.22  Real Property. ...........................................11
            2.23  Warranties. ..............................................11
            2.24  Contracts. ...............................................11
            2.25  No Goods or Products. ....................................11
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      3.    REPRESENTATIONS AND WARRANTIES OF REI...........................11
            3.1   Organization; Good Standing; Qualification and Power. ....11
            3.2   Capital Structure.........................................12
                  3.2.1 Stock, Options and Warrants. .......................12
                  3.2.2 No Other Commitments. ..............................12
            3.3   Authority.................................................12
                  3.3.1 Corporate Action. ..................................12
                  3.3.2 No Conflict. .......................................12
                  3.3.3 Governmental Consents. .............................13
            3.4   SEC Documents.............................................13
                  3.4.1 SEC Reports. .......................................13
                  3.4.2 Financial Statements. ..............................13
            3.5   Litigation. ..............................................13
            3.6   Fees and Expenses. .......................................14
            3.7   Disclosure. ..............................................14
            3.8   Financial Capacity........................................14

      4.    R-CUBE AND SELLERS' COVENANTS...................................14
            4.1   Notification of Changes. .................................14
            4.2   Maintenance of Business. .................................14
            4.3   Conduct of Business. .....................................14
            4.4   Regulatory Approvals. ....................................16
            4.5   Necessary Consents. ......................................16
            4.6   Access to Information. ...................................16
            4.7   Satisfaction of Conditions Precedent. ....................17
            4.8   Confidentiality. .........................................17
            4.9   Cooperation in Review of R-CUBE Financial Statements. ....17

      5.    REI COVENANTS...................................................17
            5.1   Regulatory Approvals. ....................................17
            5.2   Necessary Consents. ......................................17
            5.3   Satisfaction of Conditions Precedent. ....................17
            5.4   Confidentiality. .........................................18

      6.    EMPLOYEE MATTERS................................................18

      7.    INDEMNIFICATION OF THE PARTIES..................................18
            7.1   Indemnification by Sellers................................18
            7.2   Indemnification by REI....................................19
            7.3   Manner of Indemnification. ...............................19
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      8.    CLOSING.........................................................19
            8.1   Closing Date. ............................................19
            8.2   Deliveries by R-CUBE and Sellers at the Closing. .........19
            8.3   Delivery by REI at the Closing. ..........................20

      9.    CONDITIONS PRECEDENT TO OBLIGATIONS OF R-CUBE
            AND SELLER......................................................20
            9.1   Accuracy of Representations and Warranties. ..............20
            9.2   Covenants. ...............................................20
            9.3   Compliance with Law. .....................................20

      10.   CONDITIONS PRECEDENT TO OBLIGATIONS OF REI......................20
            10.1  Accuracy of Representations and Warranties. ..............21
            10.2  Covenants. ...............................................21
            10.3  Completion of Due Diligence...............................21
            10.4  Absence of Material Adverse Change. ......................21
            10.5  Compliance with Law. .....................................21
            10.6  Documents. ...............................................21
            10.7  Corporate Opinion. .......................................22
            10.8  Other Agreements..........................................22

      11.   CONDITIONS PRECEDENT TO OBLIGATIONS OF REI,
            R-CUBE AND SELLER...............................................22
            11.1  Government Consents. .....................................22
            11.2  No Legal Action. .........................................22

      12.   TERMINATION OF AGREEMENT........................................22
            12.1  Termination. .............................................22
            12.2  Notice of Termination. ...................................23
            12.3  Effect of Termination. ...................................23

      13.   NON-COMPETITION.................................................23
            13.1  Definitions...............................................23
            13.2  Non-Solicitation of Employees. ...........................24
            13.3  Non-Solicitation of Customers. ...........................24
            13.4  Additional Agreements.....................................25
            13.5  Remedies; Enforceability..................................25

      14.   SURVIVAL OF REPRESENTATIONS, WARRANTIES
            AND COVENANTS...................................................26

      15.   MISCELLANEOUS...................................................26
            15.1  Governing Law. ...........................................26
            15.2  Assignment; Binding Upon Successors and Assigns. .........26
            15.3  Severability. ............................................26
            15.4  Counterparts. ............................................26
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            15.5  Other Remedies. ..........................................26
            15.6  Amendment and Waivers. ...................................26
            15.7  Expenses. ................................................27
            15.8  Attorneys' Fees. .........................................27
            15.9  Notices. .................................................27
            15.10 Construction of Agreement. ...............................28
            15.11 No Joint Venture. ........................................28
            15.12 Further Assurances. ......................................28
            15.13 Absence of Third Party Rights. ...........................28
            15.14 Entire Agreement. ........................................28
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                                      iv.
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                            STOCK PURCHASE AGREEMENT


      THIS STOCK  PURCHASE  AGREEMENT  ("Agreement")  is entered into as of this
18th  day  of  January,  1999,  among  Research  Engineers,   Inc.,  a  Delaware
corporation  ("REI"),  R-CUBE  Technologies,   Inc.,  a  California  corporation
("R-CUBE"), and Srinivasa Reddy Malireddy, an individual ("Seller").

                                    RECITALS

     A.  Krishna P. Reddy, an individual, and Prakash Rao Pokala,  an individual
(collectively,  the "Other Sellers," and together with Seller, "Sellers"),  own,
in the  aggregate,  all of the issued and  outstanding  shares (the "Shares") of
capital stock of R-CUBE.

      B. Seller owns 1,100,000 of the Outstanding Shares ("Seller's Shares").

      C. REI desires to purchase  from  Sellers,  and Sellers  desire to sell to
REI,  the  Outstanding  Shares  on the terms  and  conditions  set forth in this
Agreement and in similar Stock Purchase  Agreements (the "Other  Agreements") to
be negotiated  and entered into between REI and the Other Sellers as of the date
of this Agreement.

                                    AGREEMENT

      NOW, THEREFORE, the parties to this Agreement agree as follows:

      1.  PURCHASE AND SALE OF SHARES.

          1.1 Purchase and Sale.  Subject to the terms and  conditions set forth
     herein,  at the  Closing  (as  defined  in Section 8 below),  Seller  shall
     transfer,  convey, assign and deliver Seller's Shares to REI, and REI shall
     acquire, purchase and accept Seller's Shares from Seller.

          1.2  Purchase  Price.  Subject  to  the  adjustments  to  be  made  in
     accordance  with the  provisions  of Sections 1.3 through 1.5, the purchase
     price for Seller's Shares is $1,066,272 (the "Purchase Price").

          1.3 Adjustment to Purchase Price. The Purchase Price shall be adjusted
     upward by 45.96% of the amount,  if any, that the  shareholders'  equity of
     R-CUBE ("Final  Shareholders'  Equity") as shown on R-CUBE's  balance sheet
     ("Final  Balance  Sheet") to be prepared by R-CUBE's  accountants as at the
     Closing Date  (defined in Section 8.1) and  delivered to REI at the Closing
     exceeds $500,000.

          1.4 Payment of Purchase Price. The Purchase Price shall be paid by REI
     to Seller as follows:

              (1) At the Closing,REI shall pay to Seller the Purchase Price; and

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              (2)  Subject to  Section  1.5,  within 30 days after the  Closing
          Date,  REI  shall  pay to  Seller  in cash the  amount  of any  upward
          adjustment to the Purchase Price made pursuant to Section 1.3.

          1.5 Review of Final Balance Sheet. REI and its  representatives  shall
     have 15 days to review  the Final  Balance  Sheet.  If REI  disagrees  with
     R-CUBE's calculation of the Final Shareholders' Equity, REI shall within 15
     days  after  the  Closing  Date give  written  notice  to  Sellers  of such
     disagreement  specifying in  reasonable  detail,  insofar as possible,  the
     nature and extent of the  disagreement.  If REI and  Sellers  are unable to
     resolve  any such  disagreement  within 15 days  after  REI  gives  Sellers
     notice, the disagreement  shall be referred for final  determination to any
     accounting firm of national  reputation as may be reasonably  acceptable to
     REI and  Sellers.  REI and  Sellers may submit to the  accounting  firm any
     facts that they deem relevant to the  determination,  and the determination
     of the accounting firm shall be conclusive, non-appealable and binding upon
     REI  and  Sellers  for  all  purposes.   Any  necessary  upward  adjustment
     determined  by the  accounting  firm shall be payable in cash by REI within
     three  days  after REI has been  notified  of such  determination.  REI and
     Sellers agree that the  procedures  established by Sections 1.2 through 1.5
     shall constitute the exclusive procedures for determining the consideration
     to be paid by REI to Sellers for the  Shares.  Costs  incurred  pursuant to
     this Section 1.5 shall be borne equally by REI and Sellers.

     2.   REPRESENTATIONS AND WARRANTIES OF R-CUBE AND SELLERS.

          Except as set forth in a schedule  dated the date of this  Agreement
and  delivered by R-CUBE and Seller to REI  concurrently  herewith  ("Disclosure
Schedule") specifically  identifying the Section of this Agreement requiring the
delivery of such  disclosure,  R-CUBE and Seller represent and warrant to REI as
set forth below. In this Agreement, any reference to any event, change or effect
being  "material"  with  respect  to any entity or group of  entities  means any
material  event,  change  or  effect  related  to the  condition  (financial  or
otherwise), properties, assets, liabilities,  businesses, operations, results of
operations or prospects of such entity or group of entities taken as a whole. In
this  Agreement,  the term "Material  Adverse  Effect" used in connection with a
party or any of that party's subsidiaries means any event, change or effect that
is materially  adverse to the condition  (financial or  otherwise),  properties,
assets, liabilities,  businesses, operations, results of operations or prospects
of that party and its subsidiaries,  taken as a whole; provided, however, that a
Material Adverse Effect shall not include: (a) any adverse effect resulting from
conditions  affecting the engineering software industry as a whole or the United
States economy as a whole; (b) a failure by R-CUBE to meet internal  earnings or
revenue projections; or (c) any disruption of customer or supplier relationships
arising primarily out of or resulting primarily from actions contemplated by the
parties  in  connection  with,  or  which  is  primarily   attributable  to  the
announcement of this Agreement and the transactions  contemplated hereby, to the
extent attributable thereto.

          2.1 Organization; Good Standing;  Qualification and Power. R-CUBE is a
     corporation duly organized, validly existing and in good standing under the
     laws of the jurisdiction of its incorporation,  has all requisite corporate
     power and authority to own,  lease and operate its  properties and to carry
     on its business as now being  conducted,  and is duly qualified and in good
     standing  to do business  in each  jurisdiction  in which the nature of its
     business or the ownership or leasing of its properties makes  qualification
     necessary,  other than in jurisdictions  where the failure to qualify would
     not have a  Material  Adverse  Effect.  R-CUBE  does not own,  directly  or
     indirectly, 

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     shares of capital stock of any other  corporation or any equity interest in
     any other entity,  nor does R-CUBE  control,  directly or  indirectly,  any
     other corporation,  association or business  organization.  R-CUBE has made
     available to REI or its counsel complete and correct copies of the articles
     of incorporation  and bylaws of R-CUBE, in each case as amended to the date
     of this  Agreement,  and copies of all minutes of  meetings  and actions by
     written consent of shareholders, directors and board committees of R-CUBE.

          2.2 Capital Structure.

               2.2.1 Stock.  The authorized  capital stock of R-CUBE consists of
          10,000,000  shares of common  stock,  no par value per share  ("R-CUBE
          Common Stock"). As of the date of this Agreement,  3,300,000 shares of
          R-CUBE Common Stock are issued and outstanding. All outstanding shares
          of the  capital  stock of R-CUBE are  validly  issued,  fully paid and
          nonassessable,  are not subject to preemptive  rights and are owned by
          Sellers  free and clear of any  liens,  security  interests,  pledges,
          agreements, claims, charges or encumbrances.
     
               2.2.2 No  Other  Commitments.  There  are no  options,  warrants,
          calls,  rights,  commitments,  conversion  rights or agreements of any
          character  to which  R-CUBE  is a party or by  which  R-CUBE  is bound
          obligating  R-CUBE to issue,  deliver or sell,  or cause to be issued,
          delivered or sold, any shares of capital stock of R-CUBE or securities
          convertible  into or  exchangeable  for  shares  of  capital  stock of
          R-CUBE,  or  obligating  R-CUBE  to grant,  extend  or enter  into any
          option,  warrant,  call,  right,   commitment,   conversion  right  or
          agreement.   There  are  no  voting  trusts  or  other  agreements  or
          understandings  to which  R-CUBE or any Seller is a party with respect
          to the voting of the capital stock of R-CUBE.

          2.3 Authority.

               2.3.1 Corporate Action.  R-CUBE has all requisite corporate power
          and  authority  to  enter  into  this  Agreement  and to  perform  its
          obligations hereunder and to consummate the transactions  contemplated
          by this  Agreement.  The execution  and delivery of this  Agreement by
          R-CUBE and the consummation by R-CUBE of the transactions contemplated
          hereby have been duly authorized by all necessary  corporate action on
          the  part of  R-CUBE.  This  Agreement  has  been  duly  executed  and
          delivered  by  R-CUBE,  and this  Agreement  is the valid and  binding
          obligation of R-CUBE, enforceable in accordance with its terms, except
          that such enforceability may be subject to (i) bankruptcy, insolvency,
          reorganization   or  other  similar  laws  affecting  or  relating  to
          enforcement of creditors'  rights generally and (ii) general equitable
          principles.

               2.3.2  Sellers'  Authority.  Each of  Sellers  has full power and
          capacity to enter into this Agreement and the Other  Agreements.  This
          Agreement  and the  Other  Agreements  have  been  duly  executed  and
          delivered by Sellers and this  Agreement  and the Other  Agreement are
          the valid and binding obligation of Sellers, enforceable in accordance
          with their  terms,  except that  enforceability  may be subject to (i)
          bankruptcy, insolvency, reorganization or other similar laws affecting
          or relating to  enforcement  of creditors'  rights  generally and (ii)
          general equitable principles.

               2.3.3  No   Conflict.   Neither  the   execution,   delivery  and
          performance  of  this   Agreement,   nor  the   consummation   of  the
          transactions contemplated hereby nor compliance with the

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          provisions  hereof will conflict with, or result in any violations of,
          or cause a default (with or without  notice or lapse of time, or both)
          under, or give rise to a right of termination, amendment, cancellation
          or  acceleration  of any  obligation  contained in, or the loss of any
          material  benefit  under,  or  result  in the  creation  of any  lien,
          security  interest,  charge or  encumbrance  upon any of the  material
          properties or assets of R-CUBE under, any term, condition or provision
          of (x) the  articles of  incorporation  or bylaws of R-CUBE or (y) any
          loan or credit agreement,  note, bond, mortgage,  indenture,  lease or
          other material  agreement,  judgment,  order,  decree,  statute,  law,
          ordinance,  rule or regulation  applicable to R-CUBE or its properties
          or  assets,  other  than any  such  conflicts,  violations,  defaults,
          losses,  liens,  security  interests,  charges, or encumbrances which,
          individually  or in the aggregate,  would not have a Material  Adverse
          Effect.

               2.3.4  Governmental  Consents.  No  consent,  approval,  order or
          authorization  of, or  registration,  declaration  or filing with, any
          court,  administrative  agency  or  commission  or other  governmental
          authority   or   instrumentality,   domestic   or   foreign   (each  a
          "Governmental  Entity"),  is  required  to be  obtained  by  R-CUBE in
          connection  with the execution  and delivery of this  Agreement or the
          consummation of the transactions contemplated hereby.

          2.4 Financial  Statements.  R-CUBE has furnished to REI copies of: (a)
     the unaudited balance sheets of R-CUBE at December 31, 1996, 1997 and 1998,
     and the related  statements of income for the periods then ended.  Prior to
     the Closing, R-CUBE shall furnish to REI copies of R-CUBE's audited balance
     sheet at  December  31, 1998 and the  related  statement  of income for the
     period then ended. All financial statements referred to in this Section 2.4
     ("R-CUBE Financial  Statements") are or will be complete and correct,  have
     been prepared in accordance with generally accepted  accounting  principles
     applied on a consistent  basis during the  respective  periods,  and fairly
     present or will fairly present the financial  condition of R-CUBE as at the
     respective  dates  thereof and the results of  operation  of R-CUBE for the
     respective  periods  covered  by the  statements  of  income  contained  in
     therein.  R-CUBE does not have any  material  obligations  or  liabilities,
     contingent  or  otherwise,  not fully  disclosed  by the  R-CUBE  Financial
     Statements.

          2.5  Compliance  with  Applicable  Laws. The business of R-CUBE is not
     being  conducted in violation of any law,  ordinance,  regulation,  rule or
     order of any Governmental  Entity where the violation would have a Material
     Adverse  Effect.  R-CUBE has not been notified by any  Governmental  Entity
     that any  investigation  or review  with  respect  to R-CUBE is  pending or
     threatened,  nor  has  any  Governmental  Entity  notified  R-CUBE  of  its
     intention to conduct an  investigation  or review.  R-CUBE has all permits,
     licenses and franchises from Governmental  Entities required to conduct its
     business as now being  conducted,  except for those whose absence would not
     have a Material Adverse Effect.

          2.6 Insurance. R-CUBE maintains and at all times since January 1, 1997
     has  maintained  general  liability  insurance  that R-CUBE  believes to be
     reasonably  prudent for its business.  The Disclosure  Schedule  contains a
     complete and correct list of all insurance  policies  maintained by R-CUBE.
     R-CUBE has delivered or made  available to REI complete and correct  copies
     of all such  policies,  together  with all riders and  amendments  thereto.
     These  policies are in full force and effect,  and all premiums due thereon
     have been paid. R-CUBE has complied in all material respects with the terms
     and provisions of the policies.  In the opinion of R-CUBE reasonably formed

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     and held,  there is no reasonable basis on which a claim should or could be
     made under any such policy.

          2.7 Litigation.  There is no suit, action, arbitration,  demand, claim
     or  proceeding  pending or, to the best  knowledge  of R-CUBE and  Sellers,
     threatened against R-CUBE, nor is there any judgment,  decree,  injunction,
     rule or order of any Governmental Entity or arbitrator  outstanding against
     R-CUBE that, individually or in the aggregate, could reasonably be expected
     to have a Material Adverse Effect.  R-CUBE has made available to REI or its
     counsel correct and complete copies of all  correspondence  prepared by its
     counsel for R-CUBE's  accountants in connection with the last two completed
     reviews of R-CUBE's financial  statements and any correspondence  since the
     date of the last review.

          2.8 Employee Benefits.

               (1) R-CUBE has made  available to REI a list of all  employees of
          R-CUBE and their salaries as of the date of this Agreement. R-CUBE has
          made available to REI copies or  descriptions of all written or formal
          plans or  agreements  involving  direct or  indirect  compensation  or
          benefits  (including  any employment  agreements  entered into between
          R-CUBE  and  any   employee   of  R-CUBE,   but   excluding   workers'
          compensation,  unemployment compensation and other government-mandated
          programs)  currently  or  previously  maintained,  contributed  to  or
          entered  into by R-CUBE  under which  R-CUBE has any present or future
          obligation  or  liability  (collectively,  "R-CUBE  Employee  Plans").
          Copies of all R-CUBE Employee Plans (and, if applicable, related trust
          agreements)  and all  amendments  thereto and written  interpretations
          thereof (including summary plan descriptions) have been made available
          to REI or its  counsel.  No  contributions  are due or past  due  from
          R-CUBE with respect to any of the R-CUBE  Employee  Plans. To R-CUBE's
          and Sellers'  knowledge,  each of the R-CUBE  Employee  Plans has been
          maintained  in  compliance  with its terms  and with the  requirements
          prescribed by any and all statutes, orders, rules and regulations that
          are applicable to the R-CUBE  Employee Plans except for  noncompliance
          which would not have a Material Adverse Effect.

               (2) R-CUBE has made  available to REI a list of each  employment,
          severance or other similar  contract,  arrangement  or policy and each
          plan or arrangement  providing for insurance  coverage  (including any
          self-insured  arrangements),  workers'  benefits,  vacation  benefits,
          severance    benefits,    disability    benefits,    death   benefits,
          hospitalization benefits,  retirement benefits, deferred compensation,
          profit-sharing, bonuses, stock options, stock purchase, phantom stock,
          stock  appreciation  or  other  forms  of  incentive  compensation  or
          post-retirement  insurance,  compensation  or benefits for  employees,
          consultants or directors  which (i) is not one of the R-CUBE  Employee
          Plans, (ii) is entered into, maintained or contributed to, as the case
          may be, by R-CUBE and (iii) covers any employee or former  employee of
          R-CUBE.  The  contracts,  plans  and  arrangements  described  in this
          paragraph  2.8(d) are referred to  collectively as the "R-CUBE Benefit
          Arrangements." To R-CUBE's and Sellers' knowledge,  each of the R-CUBE
          Benefit  Arrangements  has been  maintained in substantial  compliance
          with its terms  and with the  requirements  prescribed  by any and all
          statutes, orders, rules and regulations which are applicable to R-CUBE
          Benefit Arrangements.  R-CUBE has made available to REI or its counsel
          a  complete  and  correct  copy or  description  of each of the R-CUBE
          Benefit Arrangements.

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<PAGE>


               (3) There has been no amendment  to,  written  interpretation  or
          announcement   by  R-CUBE   relating   to,   or  change  in   employee
          participation  or coverage under,  any of the R-CUBE Employee Plans or
          R-CUBE Benefit Arrangements that would increase materially the expense
          of   maintaining   the  R-CUBE   Employee   Plans  or  R-CUBE  Benefit
          Arrangements  above  the  level of the  expense  incurred  in  respect
          thereof for the fiscal year ended December 31, 1998.

               (4) To R-CUBE's and Sellers'  knowledge,  R-CUBE is in compliance
          in all material  respects with all  applicable  laws,  agreements  and
          contracts relating to employment,  employment practices, wages, hours,
          and terms and conditions of employment.

          2.9 Absence of  Undisclosed  Liabilities.  Except as  disclosed on the
     Disclosure  Schedule,  at December  31,  1998 (the  "R-CUBE  Balance  Sheet
     Date"), (i) R-CUBE had no liabilities or obligations of any nature (matured
     or unmatured,  fixed or contingent) which were material to R-CUBE, taken as
     a whole,  and were not  provided  for in the  unaudited  December  31, 1998
     balance  sheet  (the  "R-CUBE  Balance  Sheet"),  a copy of which  has been
     delivered to REI; and (ii) all reserves established by R-CUBE and set forth
     in the R-CUBE Balance Sheet were reasonably adequate.

          2.10 Absence of Certain  Changes or Events.  Since the R-CUBE  Balance
     Sheet Date there has not occurred:

               (1)  any  change  in  the  condition  (financial  or  otherwise),
          properties,  assets, liabilities,  businesses,  operations, results of
          operations  or  prospects  of  R-CUBE  taken  as a  whole  that  could
          reasonably constitute a Material Adverse Effect;

               (2) any amendments or changes in the articles of incorporation or
          bylaws of R-CUBE;

               (3) any damage, destruction or loss, whether covered by insurance
          or not, that could reasonably constitute a Material Adverse Effect;

               (4) any redemption,  repurchase or other acquisition of shares of
          R-CUBE  Common Stock by R-CUBE  (other than  pursuant to  arrangements
          with terminated employees or consultants), or any declaration, setting
          aside or payment of any  dividend  or other  distribution  (whether in
          cash, stock or property) with respect to R-CUBE Common Stock;

               (5) any material  increase in or modification of the compensation
          or  benefits  payable  or to  become  payable  by R-CUBE to any of its
          directors  or  employees,  except in the  ordinary  course of business
          consistent with past practice;

               (6)  any  material  increase  in or  modification  of any  bonus,
          pension,  insurance  or any of the  R-CUBE  Employee  Plans or  R-CUBE
          Benefit Arrangements  (including,  but not limited to, the granting of
          stock options,  restricted stock awards or stock appreciation  rights)
          made to, for or with any of its employees,  other than in the ordinary
          course of business consistent with past practice;

                                       6
<PAGE>

              (7) any  acquisition or sale of a material  amount of property or
          assets of  R-CUBE,  other  than in the  ordinary  course  of  business
          consistent with past practices;

               (8) any  alteration  in any term of any  outstanding  security of
          R-CUBE;

               (9) any (A) incurrence,  assumption or guarantee by R-CUBE of any
          debt  for  borrowed  money;  (B)  issuance  or sale of any  securities
          convertible into or exchangeable for debt securities of R-CUBE; or (C)
          issuance or sale of options or other  rights to acquire  from  R-CUBE,
          directly or  indirectly,  debt  securities of R-CUBE or any securities
          convertible into or exchangeable for any such debt securities;

               (10) any  creation  or  assumption  by  R-CUBE  of any  mortgage,
          pledge, security interest or lien or other encumbrance on any asset;

               (11) any making of any loan,  advance or capital  contribution to
          or  investment  in any person  other than (i) travel loans or advances
          made in the  ordinary  course of business of R-CUBE,  (ii) other loans
          and  advances in an  aggregate  amount  which does not exceed  $25,000
          outstanding  at any time and  (iii)  purchases  on the open  market of
          liquid, publicly traded securities;

               (12) any entering into, amendment of, relinquishment, termination
          or  non-renewal  by  R-CUBE  of  any  contract,   lease   transaction,
          commitment  or other right or  obligation  other than in the  ordinary
          course of business;

               (13) any  transfer  or grant of an R-CUBE  intellectual  property
          right,  other than those transferred or granted in the ordinary course
          of business;

               (14) any labor dispute or charge of unfair labor practice  (other
          than  routine  individual  grievances)  or,  to  R-CUBE  and  Sellers'
          knowledge,   any   activity  or   proceeding   by  a  labor  union  or
          representative  thereof to  organize  any  employees  of R-CUBE or any
          campaign being conducted to solicit authorization from employees to be
          represented by the labor union; or
            
               (15) any  agreement  or  arrangement  made by  R-CUBE to take any
          action which,  if taken prior to the date hereof,  would have made any
          representation  or  warranty  set  forth in this  Agreement  untrue or
          incorrect unless otherwise disclosed.

          2.11 No Defaults.  R-CUBE is not in default under, and there exists no
     event,  condition or  occurrence  which,  after notice or lapse of time, or
     both, would constitute a default by R-CUBE under, any contract or agreement
     to which R-CUBE is a party and which would, if terminated or modified, have
     a Material Adverse Effect.

          2.12 Certain  Agreements.  Neither the  execution and delivery of this
     Agreement nor the consummation of the transactions contemplated hereby will
     (i)  result  in any  payment  (including,  without  limitation,  severance,
     unemployment  compensation,  golden parachute, bonus or otherwise) becoming
     due to any  director or employee  of R-CUBE from  R-CUBE,  under any of the
     R-CUBE  Employee  Plans,  R-CUBE Benefit  Arrangements  or otherwise,  (ii)
     materially  increase
                                       7


<PAGE>

     any benefits  otherwise payable under any of the R-CUBE Employee Plans, the
     R-CUBE   Benefit   Arrangements   or  otherwise  or  (iii)  result  in  the
     acceleration of the time of payment or vesting of any benefits.

          2.13 Taxes.

               (1) For purposes of this Agreement, "Tax" or collectively "Taxes"
          means any and all federal, state, local and foreign taxes, assessments
          and other governmental charges,  duties,  impositions and liabilities,
          including  taxes  based upon or measured  by gross  receipts,  income,
          profits,  sales,  use and  occupation,  and value  added,  ad valorem,
          transfer,  franchise,  withholding,  payroll,  recapture,  employment,
          estimated,  excise and property  taxes,  together  with all  interest,
          penalties and additions  imposed with respect to those amounts and any
          obligations under any agreements or arrangements with any other person
          with respect to those amounts and including any liability for taxes of
          a predecessor entity.

               (2) Except as set forth in the Disclosure  Schedule: 

                         (i)   As of the Closing,  R-CUBE will have prepared and
                    filed  all  required  federal,  state,  local,  and  foreign
                    returns,  estimates,  information  statements,  and  reports
                    relating  to any and all  Taxes  ("Returns")  concerning  or
                    attributable  to R-CUBE that are  required to be filed by or
                    with respect to R-CUBE on or prior to the Closing,  and each
                    of the  Returns  shall be, to the  knowledge  of R-CUBE  and
                    Sellers,   true,  correct,  and  complete  in  all  material
                    respects and shall have been  completed in  accordance  with
                    applicable law; 

                         (ii)  As of the Closing,  R-CUBE: (A) will have paid or
                    accrued in accordance  with  generally  accepted  accounting
                    principles all Taxes  concerning or  attributable  to R-CUBE
                    relating  to  periods   ending  on  or  before  the  Closing
                    regardless of whether reflected on Returns and (B) will have
                    withheld  with  respect to their  employees  all federal and
                    state income taxes,  FICA, FUTA, and other Taxes required to
                    be withheld;

                         (iii) R-CUBE  has not been delinquent in the payment of
                    any  Tax  nor  is  there  any  Tax  deficiency  outstanding,
                    proposed or assessed against R-CUBE, nor has R-CUBE executed
                    any waiver of the statute of limitations on or extending the
                    period for the assessment or collection of any Taxes;

                         (iv)  No  audit or other  examination  of any Return of
                    R-CUBE  is  presently  in  progress,  nor  has  R-CUBE  been
                    notified of any request for an audit or examination;

                         (v)   R-CUBE  has no  liabilities  for unpaid  federal,
                    state,  local and foreign  Taxes which have not been accrued
                    or reserved in accordance with generally accepted accounting
                    principles on the R-CUBE Balance Sheet;

                         (vi)  R-CUBE  has made available to REI and its counsel
                    copies of all federal  and state  income and all state sales
                    and use Tax  Returns  for all  periods  ending  on or  after
                    December 31, 1995;

                                       8
<PAGE>


                         (vii) There  are (and as of  immediately  following the
                    Closing there will be) no liens, pledges,  charges,  claims,
                    security  interests,  or  other  encumbrances  of  any  sort
                    ("Liens") on the assets of R-CUBE  relating or  attributable
                    to Taxes  other than liens for sales and  payroll  taxes not
                    yet due and payable;
                       
                         (viii) R-CUBE has no knowledge of any reasonable  basis
                    for the assertion of any claim relating or  attributable  to
                    Taxes which,  if adversely  determined,  would result in any
                    Lien on the assets of R-CUBE;

                         (ix)  None  of the assets of R-CUBE is property that is
                    required to be treated as owned by any other person pursuant
                    to the "safe harbor lease" provisions of former Code Section
                    168(f)(8),  and none of the assets is treated as "tax-exempt
                    use property" within the meaning of Code Section 168(h);

                         (x)   R-CUBE has not filed any consent  agreement under
                    Code Section  341(f) or agreed to have Code  Section  341(f)
                    apply to any  disposition  of a  "subsection  (f) asset" (as
                    defined in Code Section 341(f)(4)) owned by R-CUBE;

                         (xi)  R-CUBE    has   not   been    included   in   any
                    "consolidated," "unitary," or "combined" Return provided for
                    under the law of the United  States or any state or locality
                    with respect to Taxes for any taxable period;
       
                         (xii) R-CUBE   is  not  a  party  to  a  tax   sharing,
                    allocation,   indemnification   or  similar   agreement   or
                    arrangement,  and R-CUBE  does not owe any amount  under any
                    agreement or arrangement;

                         (xiii)  No  Return  of  R-CUBE  contains  a  disclosure
                    statement under Code Section 6662 (or predecessor provision)
                    or any similar provision of state, local, or foreign law;

                         (xiv) R-CUBE  is not  and has  not  been at any  time a
                    "United States real property holding corporation" within the
                    meaning of Code Section 897(c)(2);

                         (xv)  No  indebtedness of R-CUBE consists of "corporate
                    acquisition indebtedness" within the meaning of Code Section
                    279;

                         (xvi) R-CUBE has not taken any action not in accordance
                    with past  practice  that would have the effect of deferring
                    any Tax liability of R-CUBE from any period ending on before
                    the Closing  Date to any  taxable  period  ending  after the
                    Closing Date;

                         (xvii)  R-CUBE was not acquired in a  "qualified  stock
                    purchase"  under Code  Section  338(d)(3),  and no elections
                    under  Code  Section  338(g),   protective  carryover  basis
                    elections, or offset prohibition elections are applicable to
                    R-CUBE or any predecessor corporations; and

                                        9

<PAGE>

                        (xviii)  The tax  bases of the  assets  of  R-CUBE  for
                    purposes of determining future  amortization,  depreciation,
                    and other  federal  income  tax  deductions  are  accurately
                    reflected on the tax books and records of R-CUBE.

          2.14 Intellectual Property. There are no patents, patent applications,
     trademarks,  service marks, trademark and service mark applications,  trade
     names and copyrights  material to the lawful and efficient operation of the
     business of R-CUBE as presently  conducted and as presently  proposed to be
     conducted.

          2.15  Fees  and  Expenses.  Except  as set  forth  on  the  Disclosure
     Schedule,  neither R-CUBE nor Sellers have paid or become  obligated to pay
     any fee or commission to any broker,  finder or  intermediary in connection
     with the  transactions  contemplated by this Agreement.  Sellers agree that
     any such fees or commissions  described in the preceding  sentence shall be
     the sole responsibility of Sellers, whether or not the Closing occurs.

          2.16 Environmental Matters.

               (1) To R-CUBE's and Seller's knowledge, none of the properties or
          facilities  of R-CUBE is in violation  of any federal,  state or local
          law, ordinance,  regulation or order relating to industrial hygiene or
          to the  environmental  conditions on, under or about the properties or
          facilities,  including,  but not  limited  to,  soil and ground  water
          condition  except where the violations would not constitute a Material
          Adverse  Effect.  During the time that  R-CUBE has owned or leased its
          properties  and  facilities,  neither  R-CUBE  nor,  to  R-CUBE's  and
          Sellers' knowledge,  any third party, has released,  used,  generated,
          manufactured or stored on, under or about the properties or facilities
          or  transported  to or from the properties or facilities any hazardous
          materials.

               (2)  During  the  time  that  R-CUBE  has  owned  or  leased  its
          properties  and  facilities,  there has been no litigation  brought or
          threatened  against  R-CUBE  by, or any  settlement  reached by R-CUBE
          with, any party or parties alleging the presence, disposal, release or
          threatened release of any hazardous materials on, from or under any of
          the properties or facilities.

          2.17 [Intentionally Omitted].

          2.18  Disclosure.  No  representation  or  warranty  made by R-CUBE or
     Sellers  in this  Agreement  or the  Other  Agreements,  nor any  document,
     written information, written statement, financial statement, certificate or
     exhibit  prepared and furnished or to be prepared and furnished by Sellers,
     R-CUBE or their  representatives  pursuant to this  Agreement  or the Other
     Agreements or in connection with the  transactions  contemplated  hereby or
     thereby,  when taken together,  contains any untrue statement of a material
     fact, or omits to state a material fact necessary to make the statements or
     facts  contained   herein  or  therein  not  misleading  in  light  of  the
     circumstances under which they were furnished.

          2.19  Restrictions  on  Business  Activities.  There  is  no  material
     agreement,  judgment,  injunction, order or decree binding upon R-CUBE that
     has or could  reasonably be expected to have the effect of  prohibiting  or
     materially  impairing any business  practice of R-CUBE, 

                                       10
<PAGE>

     any  acquisition of property by R-CUBE or the conduct of business by R-CUBE
     as currently conducted.

          2.20 Accounts Receivable.  The accounts receivable shown on the R-CUBE
     Balance Sheet as of the R-CUBE  Balance Sheet Date, or thereafter  acquired
     prior  to the  date  hereof,  have  been  and  are  (as  the  case  may be)
     collectible  within 120 days from the Closing Date in amounts not less than
     the aggregate amounts thereof carried on the books of R-CUBE reduced by the
     reserves for discounts and bad debts taken on the R-CUBE Balance Sheet.

          2.21 Personal  Property.  R-CUBE has good title, free and clear of all
     title defects, objections and liens, including without limitation,  leases,
     chattel  mortgages,   conditional  sales  contracts,   collateral  security
     arrangements and other title or interest-retaining  arrangements, to all of
     its machinery, equipment, furniture, inventory and other personal property.
     All personal  property used in the business of R-CUBE is in good  operating
     condition.  All of the leases to personal property utilized in the business
     of R-CUBE are valid and  enforceable  against R-CUBE and are not in default
     by R-CUBE, or, to the knowledge of R-CUBE or Sellers,  are any of the other
     parties thereto in default thereof.

          2.22  Real  Property.  R-CUBE  does  not own any  real  property.  The
     Disclosure  Schedule  contains a list of all leases  for real  property  to
     which  R-CUBE is a party,  the square  footage  leased with respect to each
     lease and the  expiration  date of each lease.  These  leases are valid and
     enforceable and are not in default. To the knowledge of R-CUBE and Sellers,
     the real property leased or occupied by R-CUBE,  the  improvements  located
     thereon,  and  the  furniture,  fixtures  and  equipment  relating  thereto
     (including  plumbing,  heating,  air conditioning and electrical  systems),
     conform to any and all applicable health,  fire, safety,  zoning,  land use
     and building  laws,  ordinances and  regulations.  There are no outstanding
     contracts  made by R-CUBE for any  improvements  made to the real  property
     leased or occupied by R-CUBE that have not been paid for.

          2.23 Warranties.  R-CUBE has made no warranties or guarantees relating
     to its  services  other than as implied or required  by law.  R-CUBE has no
     warranty  or  indemnification  obligations  relating  to  patents  or other
     proprietary rights.

          2.24  Contracts.  The  Disclosure  Schedule  lists all oral or written
     agreements,  notes,  instruments or contracts to which R-CUBE is a party or
     by which its assets or properties may be bound which involve the payment or
     receipt of more than $25,000 (on an annual basis),  or which have a term of
     more than one year, or which involve  intellectual  property,  or which are
     employment or consulting agreements ("R-CUBE Contracts").  R-CUBE is not in
     default in performance of its obligations under any material  provisions of
     the R-CUBE Contracts.  Neither R-CUBE nor Sellers have any knowledge of any
     violation  of or  default  under any  R-CUBE  Contract  by any other  party
     thereto  or any  knowledge  of any  intent by any other  party to an R-CUBE
     Contract not to perform its obligations under any R-CUBE Contract.

          2.25 No  Goods or  Products.  R-CUBE  does not and has not  developed,
     sold, marketed or distributed any goods or products.

                                       11

<PAGE>

     3.   REPRESENTATIONS AND WARRANTIES OF REI.

          REI hereby represents and warrants to R-CUBE and Seller that:

          3.1  Organization;  Good Standing;  Qualification  and Power. REI is a
     corporation  duly  incorporated,  organized,  validly  existing and in good
     standing under the laws of the jurisdiction of its  incorporation,  has all
     requisite  corporate  power and  authority  to own,  lease and  operate its
     properties and to carry on its business as now being conducted, and is duly
     qualified and in good standing to do business in each jurisdiction in which
     the nature of its business or the  ownership  or leasing of its  properties
     makes  qualification  necessary,  other  than in  jurisdictions  where  the
     failure to qualify would not have a Material  Adverse Effect.  REI has made
     available  to R-CUBE or its  counsel  complete  and  correct  copies of the
     certificate of incorporation  and bylaws of REI, in each case as amended to
     the date of this  Agreement,  and  copies of all  minutes of  meetings  and
     actions by written consent of shareholders,  directors and board committees
     of REI.

          3.2 Capital Structure.

               3.2.1 Stock,  Options and Warrants.  The authorized capital stock
          of REI consists of 20,000,000  shares of common stock,  $.01 par value
          per share ("REI  Common  Stock"),  and  5,000,000  shares of Preferred
          Stock, $.01 par value per share ("REI Preferred Stock").  At the close
          of business on January 13, 1999,  5,680,710 shares of REI Common Stock
          were issued and  outstanding,  and 599,850  shares of REI Common Stock
          were  reserved for issuance upon the exercise of  outstanding  options
          ("REI  Options") and warrants ("REI  Warrants") to purchase REI Common
          Stock. No shares of REI Preferred Stock are issued or outstanding. All
          outstanding shares of REI Common Stock are validly issued,  fully paid
          and nonassessable and not subject to preemptive  rights.  REI has made
          available to R-CUBE true and correct copies of its 1996, 1997 and 1998
          Stock  Option  Plans  (each an "REI Plan" and  collectively,  the "REI
          Plans").

               3.2.2 No Other  Commitments.  Except for the REI  Options and REI
          Warrants  disclosed  in or  pursuant  to Section  3.2.1,  there are no
          options,  warrants, calls, rights,  commitments,  conversion rights or
          agreements of any character to which REI is a party or by which REI is
          bound obligating REI to issue, deliver or sell, or cause to be issued,
          delivered or sold,  any shares of capital  stock of REI or  securities
          convertible  into or exchangeable  for shares of capital stock of REI,
          or  obligating  REI to grant,  extend or enter  into any such  option,
          warrant, call, right, commitment, conversion right or agreement. There
          are no voting trusts or other  agreements or  understandings  to which
          REI is a party with respect to the voting of the capital stock of REI.

          3.3 Authority.

               3.3.1 Corporate Action. REI has all requisite corporate power and
          authority to enter into this Agreement and to perform its  obligations
          hereunder  and to consummate  the  transactions  contemplated  by this
          Agreement. The execution and delivery of this Agreement by REI and the
          consummation by REI of the transactions  contemplated hereby have been
          duly authorized by all necessary  corporate action on the part of REI.
          This  Agreement  has been duly executed and delivered by REI, and this
          Agreement is the valid and binding  obligation of REI,  enforceable in
       
                                       12
<PAGE>

          accordance with its terms,  except that  enforceability may be subject
          to (i) bankruptcy,  insolvency,  reorganization  or other similar laws
          affecting or relating to  enforcement of creditors'  rights  generally
          and (ii) general equitable principles.

               3.3.2  No   Conflict.   Neither  the   execution,   delivery  and
          performance  of  this   Agreement,   nor  the   consummation   of  the
          transactions  contemplated  hereby nor compliance  with the provisions
          hereof will conflict  with, or result in any violations of, or cause a
          default (with or without  notice or lapse of time, or both) under,  or
          give  rise to a  right  of  termination,  amendment,  cancellation  or
          acceleration  of any  obligation  contained  in,  or the  loss  of any
          material  benefit  under,  or  result  in the  creation  of any  lien,
          security  interest,  charge or  encumbrance  upon any of the  material
          properties or assets of REI under, any term, condition or provision of
          (x) the certificate of  incorporation or bylaws of REI or (y) any loan
          or credit agreement,  note, bond, mortgage,  indenture, lease or other
          material agreement,  judgment, order, decree, statute, law, ordinance,
          rule or regulation  applicable to REI or its respective  properties or
          assets, other than any such conflicts,  violations,  defaults, losses,
          liens, security interests, charges or encumbrances which, individually
          or in the aggregate, would not have a Material Adverse Effect.

               3.3.3  Governmental  Consents.  No  consent,  approval,  order or
          authorization  of, or  registration,  declaration  or filing with, any
          Governmental  Entity is required  to be obtained by REI in  connection
          with the execution and delivery of this Agreement or the  consummation
          of the transactions contemplated hereby.

          3.4 SEC Documents.

               3.4.1  SEC  Reports.  REI has made  available  to  R-CUBE  or its
          counsel  correct  and  complete  copies  of  each  report,   schedule,
          registration  statement and definitive  proxy  statement  filed by REI
          with  the  Securities  and  Exchange  Commission  ("SEC")  on or after
          January 1, 1997  ("REI SEC  Documents"),  which are all the  documents
          (other than  preliminary  material) that REI was required to file with
          the SEC on or after that date. As of their respective dates or, in the
          case of registration statements,  their effective dates (or if amended
          or superseded by a filing prior to the date of this Agreement, then on
          the date of such filing), none of the REI SEC Documents (including all
          exhibits and schedules thereto and documents incorporated by reference
          therein)  contained any untrue statement of a material fact or omitted
          to state a material fact required to be stated therein or necessary in
          order to make the statements  therein,  in light of the  circumstances
          under which they were made, not misleading,  and the REI SEC Documents
          complied when filed in all material  respects with the then applicable
          requirements  of the Securities Act or the Securities  Exchange Act of
          1934,  as amended,  as the case may be, and the rules and  regulations
          promulgated  by the SEC  thereunder.  REI has filed all  documents and
          agreements  which were required to be filed as exhibits to the REI SEC
          Documents.

               3.4.2  Financial  Statements.  The  financial  statements  of REI
          included in the REI SEC Documents  complied as to form in all material
          respects  with the then  applicable  accounting  requirements  and the
          published rules and regulations of the SEC with respect thereto,  were
          prepared in accordance with generally accepted  accounting  principles
          applied on a consistent  basis during the periods  involved (except as
          may have been  indicated  in the notes  thereto or, in the case of the
          unaudited  statements,  as permitted by Form 10-QSB promulgated by the
          SEC)  and  fairly 

                                       13
<PAGE>

          present  the  financial  position  of REI as at the  respective  dates
          thereof  and the  results  of its  operations  and cash  flows for the
          respective periods then ended.

          3.5 Litigation.  There is no suit, action, arbitration,  demand, claim
     or proceeding pending or, to the best knowledge of REI,  threatened against
     REI in connection with or relating to the transactions contemplated by this
     Agreement or of any action taken or to be taken in  connection  herewith or
     the consummation of the transactions contemplated hereby.

          3.6 Fees and Expenses. REI has not paid or become obligated to pay any
     fee or commission to any broker,  finder or intermediary in connection with
     the transactions contemplated by this Agreement.

          3.7  Disclosure.  No  representation  or warranty  made by REI in this
     Agreement,  nor  any  document,  written  information,  written  statement,
     financial  statement,  certificate or exhibits prepared and furnished or to
     be prepared and furnished by REI or its representatives  pursuant hereto or
     in  connection  with  the  transactions  contemplated  hereby,  when  taken
     together,  contains any untrue  statement of a material  fact,  or omits to
     state a material fact necessary to make the  statements or facts  contained
     herein or therein not misleading in light of the circumstances  under which
     they were furnished.

          3.8 Financial  Capacity.  REI has the financial  capability to pay the
     Purchase Price when due.

      4.  R-CUBE AND SELLERS' COVENANTS.

          4.1  Notification of Changes.  During the period from the date of this
     Agreement  until the earlier of the Closing Date or the termination of this
     Agreement in  accordance  with its terms,  R-CUBE and Sellers will promptly
     notify REI in writing (a) of any event occurring  subsequent to the date of
     this Agreement that would render any  representation  or warranty of R-CUBE
     or any Seller contained in this Agreement or the Other Agreements,  if made
     on or as of the date of the event or the Closing Date, untrue or inaccurate
     in any material respect,  (b) of any Material Adverse Effect and (c) of any
     breach by R-CUBE or any Seller of any  covenant or  agreement  contained in
     this Agreement or the Other Agreements.

          4.2  Maintenance of Business.  During the period from the date of this
     Agreement  until the earlier of the Closing Date or the termination of this
     Agreement in accordance  with its terms,  R-CUBE and Sellers will use their
     reasonable  commercial  efforts to carry on and preserve  R-CUBE's business
     and its relationships  with customers,  suppliers,  employees and others in
     substantially the same manner as it has prior to the date hereof. If R-CUBE
     or  any  Seller  becomes  aware  of  any  material   deterioration  in  the
     relationship with any material customer, material supplier or key employee,
     R-CUBE or that Seller will promptly bring that information to the attention
     of REI.

          4.3  Conduct of  Business.  During  the  period  from the date of this
     Agreement  until the earlier of the Closing Date or the termination of this
     Agreement in accordance with its terms, R-CUBE will, and Sellers will cause
     R-CUBE to,  continue to conduct its  business  and  maintain  its 

                                       14
<PAGE>

     business  relationships  in the  ordinary  and usual  course  and will not,
     without the prior written consent of REI:

               (1)  borrow  any money  except  for  amounts  that are not in the
          aggregate  material to the financial  condition of R-CUBE,  taken as a
          whole;

               (2)  enter  into any  material  transaction  not in the  ordinary
          course of its business;

               (3) encumber or permit to be encumbered  any of its assets except
          in the ordinary course of its business;

               (4) dispose of any of its assets except in the ordinary course of
          business consistent with past practice;

               (5) enter into any material lease or contract for the purchase or
          sale or  license  of any  property,  real or  personal,  except in the
          ordinary course of business;

               (6) fail to  maintain  its  equipment  and  other  assets in good
          working condition and repair according in all material respects to the
          standards it has  maintained  to the date of this  Agreement,  subject
          only to ordinary wear and tear;

               (7)  pay  (or   make   any  oral  or   written   commitments   or
          representations  to  pay)  any  bonus,  increased  salary  or  special
          remuneration to any officer, employee or consultant (except for normal
          salary increases  consistent with past practices not to exceed 10% per
          year) or enter into or vary the terms of any employment, consulting or
          severance  agreement with any person, pay any severance or termination
          pay (other than payments  made in accordance  with plans or agreements
          existing  on the date  hereof),  grant any  stock  option or issue any
          restricted stock, or enter into or modify any agreement or plan of the
          type described in Section 2.8;

               (8) change accounting methods;

               (9) declare, set aside or pay any cash or stock dividend or other
          distribution  in  respect  of capital  stock,  or redeem or  otherwise
          acquire any of its capital stock (other than pursuant to  arrangements
          with  terminated  employees or consultants  in the ordinary  course of
          business consistent with R-CUBE's past practice);

               (10) amend or  terminate  any  material  contract,  agreement  or
          license to which it is a party except those  amended or  terminated in
          the  ordinary  course of its  business,  or which are not  material in
          amount or effect;

               (11) alter in any way its manner of paying  payables,  collecting
          receivables or ordering products and services;

               (12) lend any  amount to any  person or  entity,  other  than (i)
          advances  for travel and  expenses  which are incurred in the ordinary
          course of business  consistent  with past 

                                       15


<PAGE>

          practice,  not material in amount and  documented  by receipts for the
          claimed amounts, or (ii) any loans pursuant to any R-CUBE 401(a) Plan;

               (13) guarantee or act as a surety for any obligation,  except for
          obligations in amounts that are not material;

               (14) waive or release any right or claim except for the waiver or
          release of  non-material  claims in the  ordinary  course of business,
          consistent  with past  practice  or the waiver or release of rights or
          claims set forth in the Disclosure Schedule;

               (15) issue or sell any shares of its  capital  stock of any class
          or any  other of its  securities,  or issue or  create  any  warrants,
          obligations,  subscriptions,  options, convertible securities or other
          commitments  to issue  shares of  capital  stock,  or  accelerate  the
          vesting of any outstanding option or other security;

               (16) split or combine the outstanding shares of its capital stock
          of any class or enter into any recapitalization or agreement affecting
          the number or rights of outstanding shares of its capital stock of any
          class or affecting any other of its securities;

               (17)  merge,  consolidate  or  reorganize  with,  or acquire  any
          entity;

               (18) conduct any  negotiations or agreements of any kind with any
          other  parties  with  respect to the sale of the assets or the capital
          stock of R-CUBE,  or for the  merger or sale of R-CUBE  with or to any
          other entity;

               (19) amend its articles of incorporation or bylaws;

               (20) license any intellectual property rights of R-CUBE except in
          the ordinary course of business consistent with past practice;

               (21) agree to any audit assessment by any tax authority;

               (22) change any insurance coverage; or

               (23) agree to do any of the  things  described  in the  preceding
          clauses in this Section 4.3.

          4.4 Regulatory  Approvals.  R-CUBE will promptly  execute and file, or
     join in the execution and filing of, any application or other document that
     may be necessary in order to obtain the authorization,  approval or consent
     of any governmental body,  federal,  state, local or foreign,  which may be
     required,  or which REI may  reasonably  request,  in  connection  with the
     consummation of the  transactions  contemplated  by this Agreement.  R-CUBE
     will use its reasonable efforts to promptly obtain all such authorizations,
     approvals and consents.

          4.5 Necessary Consents. During the term of this Agreement, R-CUBE will
     use its  reasonable  efforts to obtain such written  consents and take such
     other actions as may be necessary

                                       16

<PAGE>

     or  appropriate  in addition to those set forth in Section 4.4 to allow the
     consummation of the transactions contemplated hereby.

          4.6 Access to  Information.  Upon the  execution of a  confidentiality
     agreement, the form and substance of which is mutually acceptable to R-CUBE
     and REI, R-CUBE and Sellers will allow REI and its agents reasonable access
     to the files,  books,  records  and offices of R-CUBE,  including,  without
     limitation,   any  and  all   information   relating  to  R-CUBE's   taxes,
     commitments,  contracts, leases, licenses and real, personal and intangible
     property and financial  condition.  R-CUBE and Sellers will cause  R-CUBE's
     accountants to cooperate with REI and its agents in making available to REI
     all  financial  information   reasonably  requested,   including,   without
     limitation,  the right to examine all working papers  pertaining to all tax
     returns and financial statements prepared or reviewed by the accountants.

          4.7  Satisfaction  of  Conditions  Precedent.  During the term of this
     Agreement,  R-CUBE and Sellers  will use  reasonable  efforts to satisfy or
     cause to be satisfied all the  conditions  precedent  that are set forth in
     Sections  10 and 11,  and  R-CUBE  and  Sellers  will use their  reasonable
     efforts to cause the  transactions  contemplated  by this  Agreement  to be
     consummated.

          4.8  Confidentiality.  All  information  concerning  REI or any of its
     subsidiaries ("REI  Subsidiaries")  received by R-CUBE or any Seller (other
     than that  information  which is a matter of public  knowledge or which has
     been published for public  distribution or filed as public information with
     any  governmental  authority)  shall not at any time,  except in connection
     with this Agreement and the transactions  contemplated  hereby, be used for
     the advantage of, or disclosed by, R-CUBE or any Seller to any third person
     without the prior written  consent of REI.  R-CUBE and Sellers may disclose
     the  information on a confidential  basis to their  affiliates,  employees,
     officers,  agents,  auditors,  investment  bankers,  consultants,  counsel,
     directors,   present  and  prospective   lenders,  and  state  and  federal
     regulatory  agencies.  This  covenant  shall  expire on  completion  of the
     Closing;  provided,  however,  that if the Closing does not occur, it shall
     expire three years after the date of this Agreement.

          4.9 Cooperation in Review of R-CUBE Financial  Statements.  R-CUBE and
     Sellers shall  cooperate  fully with REI and its  representatives  in their
     review of the R-CUBE  Financial  Statements  and the Final  Balance  Sheet,
     including  providing  access to the information  referred to in Section 4.6
     and any other information necessary in order to complete their review.

      5.  REI COVENANTS

          5.1 Regulatory Approvals.  REI will promptly execute and file, or join
     in the execution and filing of, any  application or other document that may
     be necessary in order to obtain the  authorization,  approval or consent of
     any  governmental  body,  federal,  state,  local or  foreign  which may be
     required,  or which R-CUBE may reasonably  request,  in connection with the
     consummation of the transactions  contemplated by this Agreement.  REI will
     use its  reasonable  efforts to  promptly  obtain all such  authorizations,
     approvals and consents.

          5.2 Necessary  Consents.  During the term of this Agreement,  REI will
     use its  reasonable  efforts to obtain such written  consents and take such
     other actions as may be necessary
                                       17

<PAGE>

     or  appropriate  in addition to those set forth in Section 5.1 to allow the
     consummation of the transactions contemplated hereby.

          5.3  Satisfaction  of  Conditions  Precedent.  During the term of this
     Agreement,  REI will use its  reasonable  efforts to satisfy or cause to be
     satisfied all the conditions precedent that are set forth in Sections 9 and
     11,  and REI will use its  reasonable  efforts  to cause  the  transactions
     contemplated by this Agreement to be consummated.

          5.4 Confidentiality. All information concerning R-CUBE received by REI
     (other than that information which is a matter of public knowledge or which
     has been published for public  distribution or filed as public  information
     with  any  governmental  authority)  shall  not  at  any  time,  except  in
     connection with this Agreement and the transactions contemplated hereby, be
     used for the advantage of, or disclosed by, REI to any third person without
     the prior written consent of R-CUBE.  REI may disclose the information on a
     confidential  basis  to  its  affiliates,   employees,   officers,  agents,
     auditors, investment bankers, consultants,  counsel, directors, present and
     prospective  lenders,  and state and federal  regulatory  agencies  and, as
     provided  elsewhere in this  Agreement,  may disclose such  information  in
     press  releases  and  like  disclosures,  filings  with  the  SEC or  other
     governmental or  self-regulatory  agencies or as otherwise  required.  This
     covenant shall expire on completion of the Closing; provided, however, that
     if the Closing  does not occur,  it shall expire three years after the date
     of this Agreement.

      6.  EMPLOYEE MATTERS

          Following  the  Closing,  all  employees  of R-CUBE  will  either  (i)
     continue to be employees of R-CUBE or (ii) be offered employment by REI. In
     either case, those employees will be provided  employment benefits that are
     at least  comparable  to those they  currently  receive from R-CUBE and, if
     necessary,  R-CUBE or REI shall continue to sponsor those employees for the
     purpose of maintaining such employees' United States resident alien status.
     Notwithstanding  the foregoing,  REI makes no  representation,  warranty or
     promise as to the length of time that any such  employee will remain in the
     employ of R-CUBE or REI following the Closing.

                                       18

<PAGE>

      7.  INDEMNIFICATION OF THE PARTIES.

          7.1 Indemnification by Sellers

               (1) Sellers  shall,  jointly and  severally,  indemnify,  defend,
          protect and hold harmless REI, R-CUBE,  each of the REI  Subsidiaries,
          each of their  respective  successors  and  assigns  and each of their
          respective directors, officers, employees, agents and affiliates (each
          an "REI  Indemnified  Party"),  against all losses,  claims,  damages,
          actions, suits, proceedings, demands, assessments,  adjustments, costs
          and  expenses   (including   specifically,   but  without  limitation,
          reasonable  attorneys' fees and expenses of investigation  ("Losses"))
          based upon,  resulting  from or arising out of (i) any  inaccuracy  or
          breach  of  any  representation  or  warranty  of  R-CUBE  or  Sellers
          contained in or made in connection with this  Agreement,  and (ii) the
          breach by R-CUBE or Sellers of, or the failure by R-CUBE or Sellers to
          observe,  any  of  their  respective  covenants  or  other  agreements
          contained  in  or  made  in  connection  with  this   Agreement.   The
          indemnification  provided  for in this  Section  7.1  shall  terminate
          twelve  months  after the Closing Date (and no claims shall be made by
          REI under  this  Section  7.1  thereafter);  provided,  however,  that
          Sellers  shall  indemnify  REI for any and all  Taxes  incurred  by or
          attributable to R-CUBE prior to the Closing,  and the  indemnification
          period  relating to any Taxes shall  terminate  on the tenth day after
          the expiration of the applicable  period of limitations on assessments
          and  collections  applicable to such taxes under the Internal  Revenue
          Code of 1986.

               (2)  Notwithstanding  the foregoing,  the aggregate  amount to be
          paid by  Seller  under  Section  7.1(a)  shall not  exceed  50% of the
          Purchase  Price as  adjusted  pursuant  to Section  1.3 and net of any
          insurance  proceeds  received by REI, and Seller shall not be required
          to indemnify,  defend,  protect and hold  harmless an REI  Indemnified
          Party  pursuant  to  Section  7.1(a)  for  Losses  incurred  by an REI
          Indemnified  Party  with  respect to any  inaccuracy  or breach of any
          representation or warranty of R-CUBE or Sellers contained in Section 2
          of this  Agreement  or the  Other  Agreements  unless  and  until  the
          aggregate amount of such Losses exceeds $25,000, at which time the REI
          Indemnified  Parties  shall be entitled to  indemnification  hereunder
          with respect to all such  aggregate  amount of Losses  (including  the
          first  $25,000 of Losses) and any Losses  incurred or suffered by them
          thereafter.

          7.2 Indemnification by REI

               (1) REI  shall  indemnify,  defend,  protect  and  hold  harmless
          Sellers (each a "Seller  Indemnified  Party") against all Losses based
          upon, resulting from or arising out of (i) any inaccuracy or breach of
          any  representation,  or  warranty  of REI  contained  in or  made  in
          connection with this Agreement,  and (ii) the breach by REI of, or the
          failure by REI to observe,  any of its  covenants or other  agreements
          contained  in  or  made  in  connection  with  this   Agreement.   The
          indemnification  provided  for in this  Section  7.2  shall  terminate
          twelve  months  after the Closing Date (and no claims shall be made by
          Sellers under this Section 7.2 thereafter).

               (2)  Notwithstanding  the foregoing,  the aggregate  amount to be
          paid by REI under Section  7.2(a) shall not exceed 50% of the Purchase
          Price as adjusted  per Section 1.3 and net of any  insurance  proceeds
          received  by  Sellers,  and REI shall not be  required  to  indemnify,
          defend,  protect and hold harmless a Seller Indemnified Party pursuant
          to Section 7.2(a) for Losses 

                                       19

<PAGE>

          incurred by a Seller  Indemnified Party with respect to any inaccuracy
          or breach of any  representation  or warranty of REI contained in this
          Agreement unless and until the aggregate amount of such Losses exceeds
          $25,000,  at  which  time  the  Seller  Indemnified  Parties  shall be
          entitled  to  indemnification  hereunder  with  respect  to  all  such
          aggregate amount of Losses (including the first $25,000 of Losses) and
          any Losses incurred or suffered by them thereafter.

          7.3 Manner of Indemnification.  All indemnification under this Section
     7 shall be effected by the payment of cash or delivery of a bank  cashier's
     check, or by a combination of the foregoing.

      8.  CLOSING.

          8.1 Closing  Date.  Subject to the  termination  of this  Agreement as
     provided  in Section 12, the closing of the  transactions  contemplated  by
     this Agreement ("Closing") will take place at the offices of Rutan & Tucker
     LLP,  611 Anton,  Suite  1400,  Costa  Mesa,  California  92626 on the date
     following  satisfaction  of all  conditions set forth in Sections 9, 10 and
     11,  which  date  shall be  within  30 days of the date of this  Agreement,
     unless another place, time and date is selected by R-CUBE and REI ("Closing
     Date").

          8.2  Deliveries by R-CUBE and Sellers at the Closing.  At the Closing,
     R-CUBE and Sellers shall deliver to REI:

               (1) Certificates representing all of the Shares, free of liens or
          encumbrances, accompanied by duly executed stock powers by each Seller
          in favor of REI with all necessary  transfer stamps affixed thereto or
          other evidence of payment of applicable stock transfer taxes, if any;

               (2) The Final Balance Sheet;

               (3)  The  officers'  and  Sellers'  certificates  referred  to in
          Sections 10.1, 10.2 and 10.4; and

               (4) The opinion referred to in Section 10.7.

          8.3 Delivery by REI at the Closing. At the Closing,  REI shall deliver
     to  Seller  a  cashier's  check  or  evidence  of wire  transfer  of  funds
     representing the Purchase Price for the Seller's Shares.

      9.  CONDITIONS PRECEDENT TO OBLIGATIONS OF R-CUBE AND SELLER.

          The  obligations  of R-CUBE and Seller  hereunder  are  subject to the
     fulfillment  or  satisfaction  on or  before  the  Closing  of  each of the
     following  conditions (any one of which may be waived by R-CUBE and Seller,
     but only in a writing signed by R-CUBE and Seller):

          9.1 Accuracy of Representations and Warrants.  The representations and
     warranties  of REI set  forth in  Section 3 shall be true and  accurate  in
     every  material  respect on and

                                       20

<PAGE>

     as of the  Closing  Date with the same force and effect as if they had been
     made at the Closing except to the extent the failure of the representations
     and  warranties  to be true and  accurate in such  respects has not had and
     could not  reasonably be expected to have a Material  Adverse  Effect,  and
     R-CUBE shall receive a certificate  to that effect  executed by REI's Chief
     Executive Officer and Chief Financial Officer.

          9.2  Covenants.  REI shall have performed and complied in all material
     respects  with all of its  covenants  required to be  performed by it under
     this  Agreement  on or before  the  Closing,  and  R-CUBE  shall  receive a
     certificate  to that  effect  signed by REI's Chief  Executive  Officer and
     Chief Financial Officer.

          9.3 Compliance with Law. There shall be no order,  decree or ruling of
     any governmental  agency or written threat thereof,  or any statute,  rule,
     regulation or order enacted,  entered, enforced or deemed applicable to the
     transactions contemplated by this Agreement, which would prohibit or render
     illegal the transactions contemplated by this Agreement.

      10. CONDITIONS PRECEDENT TO OBLIGATIONS OF REI.

          The  obligations  of REI hereunder are subject to the  fulfillment  or
     satisfaction on or before the Closing, of each of the following  conditions
     (any one or more of  which  may be  waived  by REI,  but only in a  writing
     signed by REI).

          10.1 Accuracy of Representations and Warrants. The representations and
     warranties  of R-CUBE and Sellers set forth in Section 2 of this  Agreement
     and the  Other  Agreements  shall be true and  accurate  in every  material
     respect on and as of the Closing  Date with the same force and effect as if
     they had been made at the  Closing  except to the extent the failure of the
     representations and warranties to be true and accurate in such respects has
     not had and could not  reasonably  be expected  to have a Material  Adverse
     Effect, and REI shall receive  certificates to that effect executed by each
     Seller and by R-CUBE's Chief Executive Officer and Chief Financial Officer.

          10.2  Covenants.  R-CUBE and Sellers shall have performed and complied
     in all  material  respects  with  all of  their  covenants  required  to be
     performed  by them  under this  Agreement  and the Other  Agreements  on or
     before the  Closing,  and REI shall  receive  certificates  to that  effect
     signed by each Seller and by  R-CUBE's  Chief  Executive  Officer and Chief
     Financial Officer.

          10.3  Completion of Due  Diligence.  REI shall have  conducted its due
     diligence  investigation of R-CUBE and shall have  determined,  in its sole
     and absolute discretion,  that the business,  records,  assets,  contracts,
     liabilities,  operations  and other  aspects of the business of R-CUBE (the
     "Business Aspects") are satisfactory to REI in all respects. REI shall have
     seven days (the  "Initial  Diligence  Period")  following  the date of this
     Agreement  to use its  reasonable  efforts  to  perform  its due  diligence
     investigation  of R-CUBE.  If, at the expiration of such Initial  Diligence
     Period,  REI shall request  additional  time to complete its due diligence,
     R-CUBE  and  Sellers  may  promptly  grant or deny  such  request  in their
     reasonable  discretion.  If such  request is granted,  it shall allow REI a
     minimum of three additional working days (the "Extension Diligence Period")
     to complete its due diligence investigation.  Within two days following the
     expiration  of the Initial 

                                       21

<PAGE>

     Diligence  Period and the  Extension  Diligence  Period,  if any, REI shall
     notify  R-CUBE  and  Sellers  as to  whether,  in REI's  sole and  absolute
     discretion, the Business Aspects are satisfactory to REI in all respects.

          10.4 Absence of Material Adverse Change. There shall not have been any
     material  adverse  change  in  the  condition   (financial  or  otherwise),
     properties,  assets,  liabilities,   businesses,   operations,  results  of
     operations or prospects of R-CUBE,  taken as a whole,  other than:  (a) any
     adverse effect resulting from conditions affecting the engineering software
     industry as a whole or the United States economy as a whole;  (b) a failure
     by R-CUBE to meet  internal  earnings  or revenue  projections;  or (c) any
     disruption of customer or supplier  relationships  arising primarily out of
     or  resulting  primarily  from  actions  contemplated  by  the  parties  in
     connection with, or which is primarily  attributable to the announcement of
     this  Agreement and the  transactions  contemplated  hereby,  to the extent
     attributable  thereto,  and REI shall receive a certificate  to that effect
     executed by R-CUBE's Chief Executive Officer and Chief Financial Officer.

          10.5 Compliance with Law. There shall be no order, decree or ruling by
     any governmental  agency or written threat thereof,  or any statute,  rule,
     regulation or order enacted,  entered, enforced or deemed applicable to the
     transactions contemplated by this Agreement, which would prohibit or render
     illegal the transactions contemplated by this Agreement.

          10.6  Documents.   REI  shall  have  received  all  written  consents,
     assignments,  waivers,  authorizations  or  other  certificates  reasonably
     deemed  necessary by REI to provide for the  continuation in full force and
     effect of any and all  material  contracts  and  leases  of R-CUBE  and for
     R-CUBE to consummate the transactions  contemplated  hereby except when the
     failure to receive the consents,  etc.,  would not have a Material  Adverse
     Effect.

          10.7  Corporate  Opinion.  REI shall  have  received  the  opinion  of
     R-CUBE's   corporate   legal  counsel  based  upon   reasonably   requested
     certifications  as to factual  matters and dated the Closing Date regarding
     the status and authority of R-CUBE, the authorization of this Agreement and
     the transactions  contemplated  hereby by R-CUBE, and the binding effect of
     this Agreement on R-CUBE and Sellers.  The opinion shall be satisfactory to
     REI.

          10.8 Other Agreements. The closing of the Other Agreements shall occur
     simultaneously with the Closing of this Agreement.

      11. CONDITIONS PRECEDENT TO OBLIGATIONS OF REI, R-CUBE AND SELLER.

          The  obligations of REI,  R-CUBE and Sellers  hereunder are subject to
     the fulfillment or  satisfaction  on or before the Closing,  of each of the
     following conditions (any one or more of which may be waived by REI, R-CUBE
     and Seller, but only in a writing signed by REI, R-CUBE and Seller).

          11.1 Government Consents.  There shall have been obtained on or before
     the Closing such material permits or  authorizations,  and there shall have
     been  taken  such  other  action,  as may be  required  to  consummate  the
     transactions  contemplated  by this Agreement by any 

                                       22

<PAGE>

     regulatory  authority having  jurisdiction over the parties and the actions
     herein  proposed to be taken,  including  but not  limited to  requirements
     under applicable federal and state securities laws.

          11.2 No Legal  Action.  No temporary  restraining  order,  preliminary
     injunction  or  permanent   injunction  or  other  order   preventing   the
     consummation  of the  transactions  contemplated  by this  Agreement or the
     Other  Agreements  shall have been issued by any federal or state court and
     remain in  effect,  nor  shall  any  proceeding  initiated  by the  federal
     government seeking any of the foregoing be pending.

      12. TERMINATION OF AGREEMENT.

          12.1  Termination.  This Agreement may be terminated at any time prior
     to the Closing:

               (1) by written agreement of R-CUBE, REI and Seller;

               (2) by R-CUBE  and  Seller,  if there has been a breach by REI of
          any representation,  warranty, covenant or agreement set forth in this
          Agreement  on the part of REI, or if any  representation  of REI shall
          have  become  untrue,  in either case which has or can  reasonably  be
          expected to have a Material Adverse Effect and which REI fails to cure
          prior to the Closing (except that no cure period shall be provided for
          a breach by REI which by its nature cannot be cured);

               (3) by REI, if there has been a breach by R-CUBE or Seller of any
          representation,  warranty,  covenant  or  agreement  set forth in this
          Agreement on the part of R-CUBE or Seller, or if any representation of
          R-CUBE or Seller shall have become untrue, in either case which has or
          can reasonably be expected to have a Material Adverse Effect and which
          R-CUBE or Seller  fails to cure prior to the Closing  (except  that no
          cure period  shall be provided  for a breach by R-CUBE or Seller which
          by its nature cannot be cured);

               (4) by R-CUBE, Seller or REI, if:

                    (i)...if all the  conditions for Closing shall not have been
               satisfied or waived on or before  February 28, 1999 other than as
               a result of a breach of this Agreement by the terminating  party;
               or

                    (ii)..if  a  permanent  injunction  or  other  order  by any
               federal or state  court  which  would make  illegal or  otherwise
               restrain  or  prohibit  the   consummation  of  the  transactions
               contemplated  by this Agreement  shall have been issued and shall
               have become final and nonappealable.

          12.2 Notice of  Termination.  Any  termination of this Agreement under
     Section 12.1 will be  effective  by the  delivery of written  notice of the
     terminating party to the other parties hereto.

                                       23
<PAGE>

          12.3 Effect of  Termination.  In the case of any  termination  of this
     Agreement  or the  Other  Agreements  as  provided  in  Section  12 of this
     Agreement or the Other  Agreements,  this Agreement  shall be of no further
     force and effect  (except as provided  in Section  14) and  nothing  herein
     shall relieve any party from  liability for any breach of this Agreement or
     the Other Agreements. In case of any termination as a result of a breach by
     a party or the  failure  of a party to  satisfy  Closing  conditions  to be
     satisfied by it and which are within its control, that party shall bear all
     of  the  expenses   (including,   without  limitation,   reasonable  legal,
     accounting  and other  advisory  fees) of the  other  parties  incurred  in
     connection with the failed transaction; provided, however, that in no event
     shall REI be responsible for payment of the fees and expenses  described in
     Section  2.15.  In all other  cases of  termination,  each  party  shall be
     responsible for its own expenses.

      13. NON-COMPETITION.

          13.1 Definitions. For purposes of this Section 13, the following terms
     shall have the following meanings:

               (1) "Customer  Non-Solicitation  Period" shall mean, with respect
          to  each  Seller,  the  period  commencing  on the  Closing  Date  and
          continuing  for a period  of two  years  after  such  date;  provided,
          however,  that the  Customer  Non-Solicitation  Period with respect to
          each  Seller  shall be  extended  by the  number of days in which such
          Seller  is or was  engaged  in  activities  constituting  a breach  of
          Section 13.3.

               (2) The term "Customers" shall mean, with respect to each Seller,
          any manager,  group or division  located in a specific  building that,
          during the year preceding the date of this  Agreement,  as of the date
          of this  Agreement,  during the period from the date of this Agreement
          to the Closing Date or during the Employee  Non-Solicitation Period or
          the Customer Non-Solicitation Period is or was a client or customer of
          R-CUBE.

               (3) The words  "directly  or  indirectly"  shall mean:  (i) being
          personally  involved in providing or seeking to provide services to an
          Employee,  Customer or Prospective Customer; (ii) participating in any
          person or  enterprise as an owner,  partner,  limited  partner,  joint
          venturer,  controlling  member or  controlling  shareholder;  or (iii)
          communicating  to any  such  person  or  enterprise  any  confidential
          information  of the business  conducted by R-CUBE  during the relevant
          period.

               (4)  "Employees"  shall  mean any  employee  of  R-CUBE as of, or
          immediately  prior to the date of this  Agreement,  during  the period
          from the date of this  Agreement  to the  Closing  Date or during  the
          Employee  Non-Solicitation  Period  or the  Customer  Non-Solicitation
          Period.

               (5) "Employee  Non-Solicitation  Period" shall mean, with respect
          to  each  Seller,  the  period  commencing  on the  Closing  Date  and
          continuing  for a period  of two  years  after  such  date;  provided,
          however,  that the  Employee  Non-Solicitation  Period with respect to
          each  Seller  shall be  extended  by the  number of days in which such
          Seller  is or was  engaged  in  activities  constituting  a breach  of
          Section 13.2.  Notwithstanding the foregoing sentence, with respect to
          the

                                       24

<PAGE>

          employment of Mr.  Deepak  Suktbankar,  the Employee  Non-Solicitation
          Period shall be from the date of this Agreement  through and including
          the date that is 45 days after the Closing Date.

               (6) The term  "person"  shall  mean  any  natural  person,  firm,
          partnership,  association,  corporation,  company,  limited  liability
          company,  limited  partnership,  trust,  business trust,  Governmental
          Entity or other entity.

               (7) The term "Prospective Customer" shall mean any manager, group
          or division located in a specific  building that R-CUBE has contacted,
          or has  developed a strategy  or plan to  contact,  for the purpose of
          acquiring manager, group or division as a customer or client.

          13.2  Non-Solicitation  of  Employees.   Sellers  recognize  that  the
     Employees  are a  valuable  resource  of  R-CUBE.  Accordingly,  during the
     Employee  Non-Solicitation  Period,  no Seller  shall,  either  alone or in
     conjunction with any other person or entity, directly or indirectly go into
     business  with any  Employee or solicit,  induce or recruit any Employee to
     leave the employ of R-CUBE.

          13.3  Non-Solicitation of Customers.  Sellers recognize that customers
     are a  valuable  resource  of  R-CUBE.  Accordingly,  during  the  Employee
     Non-Solicitation  Period,  no Seller shall,  either alone or in conjunction
     with any other person or entity,  directly or indirectly  call on, solicit,
     take away, accept as a client,  customer or prospective client or customer,
     or attempt to call on, solicit, take away, accept as a client,  customer or
     prospective client or customer a Customer or Prospective Customer.

          13.4  Additional  Agreements.   Seller  hereby  expressly  agrees  and
     acknowledges that:

               (1) R-CUBE has protectable business interests with respect to its
          Employees,  Customers and Prospective Customers,  and that competition
          with and against such business interests would be harmful to R-CUBE;

               (2) the covenants  contained in this Section 13 are reasonable as
          to time and geographical area and do not place any unreasonable burden
          upon each Seller's ability to earn a livelihood;

               (3) the public will not be harmed as a result of  enforcement  of
          the covenants contained in this Section 13;

               (4) the personal  legal  counsel for each Seller has reviewed the
          covenants contained in this Section 13;

               (5) the parties have entered into the covenants  contained herein
          in connection with and as a condition precedent to the consummation of
          the  Agreement and the Other  Agreements,  pursuant to which REI shall
          acquire  R-CUBE;  the  agreements,  actions,  covenants,  and promises
          contained  herein  are  intended  to  protect  and ensure the value of
          R-CUBE, including its goodwill, which actions, covenants, and promises
          are a material  consideration to REI in connection

                                       25

<PAGE>

          with this Agreement and the Other Agreements;  and, to the extent that
          the laws of any  jurisdiction  in which  this  Agreement  or the Other
          Agreements   shall  be   interpreted,   construed,   and/or   enforced
          distinguish  between  covenants given in connection with the sale of a
          business and its  goodwill  and  covenants  given in  connection  with
          employment,  this  covenant  will be given the broader  interpretation
          customarily  given  to  covenants  in  connection  with  the sale of a
          business and the transfer of goodwill to REI; and

               (6) each Seller understands and agrees to each and every term and
          condition  contained  Section  13 of  this  Agreement  and  the  Other
          Agreements.

          13.5 Remedies; Enforceability. Seller recognizes and acknowledges that
     irreparable damage will result to REI in the event of a breach by Seller or
     any of  Seller's  affiliates  of the  provisions  of this  Section 13, and,
     accordingly,  in the  event  of such a  breach,  REI will be  entitled,  in
     addition to any other legal or  equitable  damages and remedies to which it
     may be entitled or which may be available, to an injunction to restrain the
     violation thereof. If any provision of this Section 13 shall be adjudicated
     by a court of competent jurisdiction to be invalid or unenforceable because
     of the scope, duration, area of its applicability, or any other reason, the
     court making such  determination  will have the power to modify such scope,
     duration, or area, or all of them, or to strike an invalid or unenforceable
     provision, in whole or in part, to the extent necessary to make such scope,
     duration, area, or provision valid and enforceable.

      14. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS.

          All representations, warranties and covenants of the parties contained
     in this  Agreement  will  remain  operative  and in full force and  effect,
     regardless of any investigation made by or on behalf of the parties to this
     Agreement,  until the earlier of the  termination  of this Agreement or one
     year after the Closing Date, whereupon the representations,  warranties and
     covenants  will expire (except for  covenants,  such as those  contained in
     Sections  4.8,  5.4, 7 and 13,  that by their  terms  survive  for a longer
     period).

      15. MISCELLANEOUS.

          15.1  Governing  Law.  The  internal  laws of the State of  California
     (irrespective  of its choice of law principles) will govern the validity of
     this Agreement,  the construction of its terms and the  interpretation  and
     enforcement of the rights and duties of the parties hereto.

          15.2 Assignment;  Binding Upon Successors and Assigns. No party hereto
     may assign any of its rights or  obligations  hereunder  without  the prior
     written consent of the other parties hereto. This Agreement will be binding
     upon and inure to the  benefit of the parties  hereto and their  respective
     successors and permitted assigns.

          15.3  Severability.  If  any  provision  of  this  Agreement,  or  the
     application  thereof,  will for any  reason and to any extent be invalid or
     unenforceable,  the  remainder of this  Agreement and  application  of such
     provision  to other  persons or  circumstances  will be  interpreted  so as
     reasonably  to effect the  interest  of the  parties  hereto.  The  parties
     further  agree to  replace  such void or  unenforceable  provision  of this
     Agreement with a valid and enforceable  provision that will

                                       26

<PAGE>

     achieve, to the greatest extent possible, the economic,  business and other
     purpose of the void unenforceable provision.

          15.4  Counterparts.  This  Agreement  may be executed in any number of
     counterparts, each of which will be deemed an original as regards any party
     whose  signature  appears thereon and all of which together will constitute
     one and the same instrument. This Agreement will become binding when one or
     more  counterparts  hereof,  individually or taken together,  will bear the
     signatures of all the parties reflected hereon as signatories.

          15.5 Other Remedies.  Except as otherwise provided herein, any and all
     remedies herein expressly  conferred upon a party will be deemed cumulative
     with and not  exclusive of any other remedy  conferred  hereby or by law on
     such  party,  and the  exercise  of any one remedy  will not  preclude  the
     exercise of any other.

          15.6  Amendment and Waivers.  Any term or provision of this  Agreement
     may be amended,  and the  observance  of any term of this  Agreement may be
     waived   (either   generally  or  in  a  particular   instance  and  either
     retroactively or prospectively) only by a writing signed by the party to be
     bound thereby. The waiver by a party of any breach hereof or default in the
     performance  hereof will not be deemed to  constitute a waiver of any other
     default or any succeeding breach or default.

          15.7  Expenses.  Except as provided in Section  12.3,  REI, on the one
     hand,  and  Sellers  and  R-CUBE,  on the  other,  will each bear their own
     expenses and legal fees  incurred  with respect to this  Agreement  and the
     transactions contemplated hereby.

          15.8 Attorneys'  Fees.  Should suit be brought to enforce or interpret
     any part of this  Agreement,  the  prevailing  party  will be  entitled  to
     recover, as an element of the costs of suit and not as damages,  reasonable
     attorneys' fees to be fixed by the court  (including,  without  limitation,
     costs, expenses and fees on any appeal).

          15.9 Notices.  All notices and other  communications  pursuant to this
     Agreement shall be in writing and deemed to be sufficient if contained in a
     written  instrument  and shall be  deemed  given if  delivered  personally,
     telecopied,  sent by  nationally-recognized  overnight courier or mailed by
     registered or certified mail (return receipt  requested),  postage prepaid,
     to the parties at the following  address (at such other address for a party
     as shall be specified by like notice):

<TABLE>
            <C>                     <S>
            If to R-CUBE to:........R-CUBE Technologies, Inc.
                                    20410 Town Center Lane, #160
                                    Cupertino, California  95014
                                    Attention: Chief Executive Officer
                                    Telecopier: (408) 255-2042
</TABLE>

                                       27
<PAGE>
<TABLE>
            <C>                     <S>
            With a copy to:.........Gray Cary Ware & Friedenrich LLP
                                    4365 Executive Drive, Suite 1600
                                    San Diego, California 92121-2189
                                    Attention: Christopher M. Smith, Esq.
                                    Telecopier: (619) 677-1477

            If to REI to:...........Research Engineers, Inc.
                                    22700 Savi Ranch Parkway
                                    Yorba Linda, California 92887
                                    Attention: Chief Executive Officer
                                    Telecopier: (714) 974-4771

            With a copy to:.........Rutan & Tucker, LP
                                    611 Anton, Suite 1400
                                    Costa Mesa, California 92626
                                    Attention: Cristy G. Lomenzo, Esq.
                                    Telecopier: (714) 546-9035

            If to Sellers to:.......Srinivasa Reddy Malireddy
                                    21195 Granola Road
                                    Cupertino, California 95014
</TABLE>

          All  notices  and  other  communications  shall be deemed to have been
     received (a) in the case of personal delivery, on the date of delivery, (b)
     in the case of a  telecopy,  when the party  receiving  the copy shall have
     confirmed  receipt of the  communication,  (c) in the case of  delivery  by
     nationally-recognized  overnight  courier,  on the business  day  following
     dispatch,  and (d) in the  case  of  mailing,  on the  third  business  day
     following such mailing.

          15.10 Construction of Agreement. This Agreement has been negotiated by
     the respective  parties hereto and their  attorneys and the language hereof
     will not be construed for or against either party. A reference to a Section
     or an Exhibit will mean a Section in, or Exhibit to, this Agreement  unless
     otherwise  explicitly  set forth.  The titles and  headings  herein are for
     reference  purposes only and will not in any manner limit the  construction
     of this Agreement which will be considered as a whole.

          15.11 No Joint  Venture.  Nothing  contained in this Agreement will be
     deemed or construed as creating a joint venture or partnership  between any
     of the parties to this  Agreement.  No party is by virtue of this Agreement
     authorized  as an  agent,  employee  or legal  representative  of any other
     party.  No  party  will  have the  power  to  control  the  activities  and
     operations  of any other.  The status of the parties  hereto is, and at all
     times will continue to be, that of independent  contractors with respect to
     each other. No party will have any power or authority to bind or commit any
     other.   No  party  will  hold  itself  out  as  having  any  authority  or
     relationship in contravention of this Section.

          15.12 Further  Assurances.  Each party agrees to cooperate  fully with
     the other  parties and to execute such further  instruments,  documents and
     agreements and to give such further written assurances as may be reasonably
     requested  by any other  party to evidence  and  reflect  the 

                                       28

<PAGE>

     transactions  described  herein and  contemplated  hereby and to carry into
     effect the intents and purposes of this Agreement.

          15.13 Absence of Third Party Rights.  No provisions of this  Agreement
     are intended, nor will be interpreted, to provide or create any third party
     beneficiary rights or any other rights of any kind in any client, customer,
     affiliate,  shareholder  or partner of any party hereto or any other person
     or entity unless specifically  provided otherwise herein, and, except as so
     provided, all provisions hereof will be personal solely between the parties
     to this Agreement.

          15.14 Entire Agreement.  This Agreement and the schedules and exhibits
     hereto  constitute  the entire  understanding  and agreement of the parties
     hereto with respect to the subject  matter  hereof and  supersede all prior
     and   contemporaneous   agreements  or   understandings,   inducements   or
     conditions,  express or implied,  written or oral, between the parties with
     respect  hereto.  The express terms hereof control and supersede any course
     of performance or usage of trade inconsistent with any of the terms hereof.

                                       29
<PAGE>




      IN WITNESS  WHEREOF,  the  parties  hereto  have  executed  or caused this
Agreement to be executed by their duly authorized  respective officers as of the
date first above written.

REI:                                RESEARCH ENGINEERS, INC.,
                                    a Delaware corporation

                                    By: /S/ AMRIT K. DAS
                                    --------------------
                                    Amrit K. Das, President

                                    By: /S/ WAYNE L. BLAIR
                                    ----------------------
                                    Wayne L. Blair, Secretary

R-CUBE:                             R-CUBE TECHNOLOGIES, INC.,
                                    a California corporation

                                    By: /S/ KRISHNA P. REDDY
                                    ------------------------
                                    Krishna P. Reddy, President

                                    By: /S/ SRINIVASA REDDY MALIREDDY
                                    ---------------------------------
                                    Srinivasa Reddy Malireddy,
                                    Secretary

SELLER:                             /S/ SRINIVASA REDDY MALIREDDY
                                    -----------------------------
                                    Srinivasa Reddy Malireddy, an
                                    individual


I, THE  SPOUSE OF  SELLER,  HAVE  EXECUTED  THIS  AGREEMENT  FOR THE  PURPOSE OF
CONFIRMING MY CONSENT TO THE CONVEYANCE OF MY COMMUNITY  PROPERTY  INTEREST,  IF
ANY, IN SHARES OF CAPITAL STOCK OF R-CUBE PURSUANT TO THIS AGREEMENT

                /S/ M. VEDA VATHI
                ----------------------------
                Print Name: M. Veda Vathi





                                       30

Source: OneCLE Business Contracts.