x
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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77-0432030
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(State or Other Jurisdiction of
Incorporation or Organization)
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(I.R.S. Employer
Identification No.)
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Title of Each Class
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Name of Each Exchange On Which Registered
|
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Common Stock, $0.002 par value per share
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The NASDAQ Global Market
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Large accelerated filer
¨
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Accelerated filer
¨
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Non-accelerated filer
¨
(Do not check if a smaller reporting company)
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Smaller reporting company
x
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Part I
|
||
Item 1
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Business
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4
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Item 1A
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Risk Factors
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9
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Item 1B
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Unresolved Staff Comments
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15
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Item 2
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Properties
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15
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Item 3
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Legal Proceedings
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16
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Item 4
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Submission of Matters to a Vote of Security Holders
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16
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Part II
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||
Item 5
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Market for the Registrant’s Common Equity, Related Stockholder Matters and Small Business Issuer Purchases of Equity Securities
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17
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Item 6
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Selected Financial Data
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19
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Item 7
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
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20
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Item 7A
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Quantitative and Qualitative Disclosures about Market Risk
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26
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Item 8
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Financial Statements and Supplementary Data
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27
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Item 9
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Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
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52
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Item 9A
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Controls and Procedures
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52
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Item 9B
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Other Information
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53
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Part III
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||
Item 10
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Directors, Executive Officers and Corporate Governance
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54
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Item 11
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Executive Compensation
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54
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Item 12
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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
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54
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Item 13
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Certain Relationships and Related Transactions, and Director Independence
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54
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Item 14
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Principal Accounting Fees and Services
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54
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Part IV
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||
Item 15
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Exhibits and Financial Statement Schedules
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55
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SIGNATURES
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Item 1.
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Business
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|
•
|
Corporate legal organizations.
The General Counsel’s office and other legal organizations can use the contract management solution to transform paper-bound contracts into a secure, centralized, searchable electronic contract repository and gain visibility and control of all corporate agreements.
|
|
•
|
Procurement organization.
Procurement contract managers can use the contract management solution to expose off-contract spending.
|
|
•
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Sales organization.
Sales organizations can use the sales contract management solution to shorten the sales cycle and decrease time to revenue, while potentially protecting the company from inadvertent legal errors.
|
|
•
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Finance organizations.
Finance organizations can use the contract management solution to identify and account for non-standard terms and pricing in the revenue cycle while discovering unrealized revenue buried in sales agreements.
|
|
•
|
Contract Administration.
Contract administrators can use the contract management solution to create visibility into contract obligations not captured by ERP and CRM and empower non-contract professionals to create and execute basic contracts.
|
|
•
|
Adaptable
. Adaptable, without sacrificing scalability or speed of implementation. The CLM solution is applicable to both buy and sell-side contracts. Our vertical expertise and advanced sell-side features such as flowdown, workflow and authoring tools help differentiate our CLM solution from its competitors.
|
|
•
|
Configurable
. Combines the stability of rigid contract management software solutions with the flexibility of custom solutions by allowing companies to configure and update the product without expensive services and engineering support.
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•
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Flexible
. Available On-Demand (SaaS) Hosted and Enterprise (On-Site / behind-the-firewall) deployment options using the same application platform.
|
|
•
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Industry Customizable
. Customizable for a broad array of contract types including procurement, sales, governance, healthcare provider, intellectual property, IT, equipment leasing, employee, real estate, partnership, supplier and services agreements.
|
|
•
|
Rapid Deployment
. Our Contract Performance Management solution is delivered in an average of 90 days or less, which we believe is shorter than the average deployment times for many competitive software solutions.
|
|
•
|
Extensive Analytics and Reporting Capabilities
. Enables detailed contract analysis and performance management by combining both structured and unstructured information stored in its contract repository.
|
|
•
|
Increased Revenue.
By enabling context-driven cross-sell and up-sell options, companies can increase incremental revenue. Additionally, the configuration solution enables users to combine lines of business to capture higher spend on a per customer basis.
|
|
•
|
Increased Channel Sales.
By equipping channel partners with our easy-to-use, web-based, graphical interface to more easily sell complex products and services, companies can boost channel revenue.
|
|
•
|
Faster Time to Cash.
By configuring complex products and services in minutes, rather than days or weeks, organizations can close deals more quickly and accelerate revenue generation.
|
|
•
|
Improved Margin.
By incorporating pricing/margin during the configuration process, companies can create a configuration that meets user’s objectives at the lowest price for the company, which can improve margins.
|
|
•
|
Decreased Cost.
By preventing rework and cancellations due to incorrect orders, companies can save money.
|
|
•
|
Customer Satisfaction.
Our configuration solution ensures quote and order accuracy.
|
|
•
|
Flexibility.
Our configuration solution can accommodate both sales configurations and manufacturing configurations, enabling our solution to be deployed to sales organizations, manufacturing organizations, or both. The configuration solution can also allow a very large number of SKU’s or offerings and a very large number of users.
|
|
•
|
Declarative Constraint Engine (DCE).
The DCE describes relationships among product features and components, allowing business logic to be modeled with simple declarative statements rather than complex programming. This approach also helps to simplify model processing and allows for a faster configuration process, even for highly complex products.
|
|
•
|
Efficient Modeling.
Flexible modeling tools, easy-to-use wizards, automated business logic creation, and repositories of business logic help shorten the time required for development teams to deliver advanced capabilities and customize or update SCS-based applications.
|
|
•
|
Development Studio.
SCS’s Development Studio’s Model Builder is a rich modeling tool that allows graphical modeling of products and services which are submitted to the Selectica Knowledge Base. A model profiler is also available for inspecting and measuring runtime execution of models.
|
|
•
|
Updates by non-technical personnel.
In most organizations, business-critical information is stored in repositories, such as relational databases and other applications, and is updated very frequently. The SCS architecture allows changes in business-critical information to be automatically reflected in the application.
|
|
•
|
Flexible and Scalable Deployment.
SCS is Java-based and can be deployed on a wide range of server hardware and web application servers, such as JBoss, Weblogic or Websphere. We have also introduced a laptop-based version of the configuration engine for real-time configuration at remote customer locations.
|
Item 1A.
|
Risk Factors
|
·
|
a longer operating history;
|
·
|
preferred vendor status with our customers;
|
·
|
more extensive name recognition and marketing power; and
|
·
|
significantly greater financial, technical, marketing and other resources, giving them the ability to respond more quickly to new or changing opportunities, technologies, and customer requirements.
|
·
|
restricting the ability of stockholders to call special meetings of stockholders;
|
·
|
prohibiting stockholder action by written consent;
|
·
|
establishing advance notice requirements for nominations for election to the board of directors or for proposing matters that can be acted on by stockholders at stockholder meetings;
|
·
|
granting our board of directors the ability to designate the terms of and issue new series of preferred stock without stockholder approval; and
|
·
|
issuing shareholders rights to purchase additional shares of stock in the event that any person, together with its affiliates and associates, (i) acquires beneficial ownership of 4.99% or more of our outstanding common stock or (ii) commences a tender offer for our shares if upon consummation of the tender offer such person would beneficially own 4.99% or more of the outstanding common stock, subject, in each case, to certain exceptions.
|
Item 1B.
|
Unresolved Staff Comments
|
Item 2.
|
Properties
|
Item 3.
|
Legal Proceedings
|
Item 4.
|
Removed and Reserved.
|
Item 5.
|
Market for the Registrant’s Common Equity, Related Stockholder Matters and Small Business Issuer Purchases of Equity Securities
|
High (1)
|
Low (1)
|
|||||||
Fiscal 2009
|
||||||||
First Quarter
|
$ | 31.20 | $ | 26.00 | ||||
Second Quarter
|
$ | 25.20 | $ | 20.20 | ||||
Third Quarter
|
$ | 21.80 | $ | 12.00 | ||||
Fourth Quarter
|
$ | 17.60 | $ | 5.80 | (2) | |||
Fiscal 2010
|
||||||||
First Quarter
|
$ | 10.00 | $ | 6.40 | ||||
Second Quarter
|
$ | 8.40 | $ | 6.60 | ||||
Third Quarter
|
$ | 7.40 | $ | 4.20 | ||||
Fourth Quarter
|
$ | 6.00 | $ | 3.80 |
(1)
|
On February 9, 2010, our Board of Directors approved a one-for-twenty reverse stock split of Selectica common stock, effective February 24, 2010. The reverse stock split was intended to bring us in compliance with NASDAQ Listing Rules related to the minimum trading price of the company’s common stock. The above stock prices have been adjusted to reflect the reverse stock split.
|
(2)
|
On January 2, 2009, a special committee of our Board of Directors declared Trilogy as an “Acquiring Person” under the Rights Agreement, and as a result, on February 4, 2009 we completed the distribution of 1.3 million shares to all existing shareholders (under the Exchange Provision in the Rights Agreement) other than Trilogy.
|
A | B | C | ||||||||||
Plan category
|
Number of
securities to
be issued upon
exercise of
outstanding options
warrants and rights
|
Weighted-average
exercise price of
outstanding options
warrants and rights
|
Number of securities
remaining available for
future issuance under
equity compensation
plans (excluding securities
reflected in Column A)
|
|||||||||
(in thousands, except for per share amounts below)
|
||||||||||||
Equity compensation plans approved by stockholders
|
178 | $ | 21.07 | 1,370 | (1)(2) | |||||||
Equity compensation plans not approved by stockholders
|
3 | $ | 38.91 | 181 | ||||||||
Total
|
181 | $ | 21.86 | 1,551 |
(1)
|
These plans permit the grant of options, stock appreciation rights, shares of restricted stock and stock units.
|
(2)
|
Beginning January 1, 2001, and each anniversary thereafter up to and including January 1, 2010, the number of shares reserved for issuance under our 1999 Equity Incentive Plan was automatically increased by the lesser of 5% of the then outstanding shares of common stock or 180,000 shares. In May, 2010, the 1999 Equity Incentive Plan was amended such that the number of shares reserved for issuance are no longer automatically increased and a total of 1,551,000 shares are reserved for future issuance thereunder. On each May 1, starting in 2001, the number of shares reserved for issuance under our 1999 Employee Stock Purchase Plan will be automatically increased by the lesser of 2% of the then outstanding shares of common stock or 100,000 shares.
|
Period
|
Total Number
of
Shares
Purchased
|
|
Average
Price Paid
per Share
|
|
Total Number
of
Shares
Purchased as
Part of Publicly
Announced
Plans or
Programs
|
Maximum Number
(or
Approximate
Dollar Value)
of Shares That
May Yet be
Purchased
Under the Plans
or Program
|
|||
April 1, 2009 – April 30, 2009
|
—
|
|
—
|
|
—
|
—
|
|||
May 1, 2009 – May 31, 2009
|
—
|
|
—
|
|
—
|
—
|
|||
June 1, 2009 – June 30, 2009
|
—
|
|
—
|
|
—
|
—
|
|||
July 1, 2009 – July 31, 2009
|
894
|
$ |
7.80
|
—
|
—
|
||||
August 1, 2009 – August 31, 2009
|
—
|
|
—
|
|
—
|
—
|
|||
September 1, 2009 – September 30, 2009
|
—
|
|
—
|
|
—
|
—
|
|||
October 1, 2009—October 31, 2009
|
—
|
|
—
|
|
—
|
—
|
|||
November 1, 2009—November 30, 2009
|
5,644
|
|
$ |
5.40
|
|
—
|
—
|
||
December 1, 2009—December 31, 2009
|
—
|
|
—
|
|
—
|
—
|
|||
January 1, 2010 – January 31, 2010
|
|||||||||
February 1, 2010 – February 28, 2010
|
1,334
|
|
$ |
4.52
|
|
—
|
—
|
||
March 1, 2010—March 31, 2010
|
—
|
|
—
|
|
—
|
—
|
|||
|
|
||||||||
Total | 7,872 | $ |
5.54
|
— | — |
Item 6.
|
Selected Financial Data.
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
2010
|
2009
|
Change
|
||||||||||
(in thousands, except percentages)
|
||||||||||||
License
|
$ | 3,182 | $ | 3,569 | $ | (387 | ) | |||||
Percentage of total revenues
|
21 | % | 22 | % | (11 | )% | ||||||
Services
|
$ | 11,977 | $ | 12,876 | $ | (899 | ) | |||||
Percentage of total revenues
|
79 | % | 78 | % | (7 | )% | ||||||
Total revenues
|
$ | 15,159 | $ | 16,445 | $ | (1,286 | ) |
2010
|
2009
|
|||||||
Customer A
|
15 | % | 18 | % | ||||
Customer B
|
10 | % | * |
2010
|
2009
|
Change
|
||||||||||
Cost of license revenues
|
$ | 163 | $ | 206 | $ | (43 | ) | |||||
Percentage of license revenues
|
5 | % | 6 | % | — | |||||||
Cost of services revenues
|
$ | 5,291 | $ | 5,563 | $ | (272 | ) | |||||
Percentage of services revenues
|
44 | % | 43 | % | — | |||||||
Total cost of revenues
|
$ | 5,454 | $ | 5,769 | $ | (315 | ) |
2010
|
2009
|
|||||||
Gross margin, license revenues
|
95 | % | 94 | % | ||||
Gross margin, services revenues
|
56 | % | 57 | % | ||||
Gross margin, total revenues
|
64 | % | 65 | % |
2010
|
2009
|
Change
|
||||||||||
Total research and development
|
$ | 3,274 | $ | 4,218 | $ | (944 | ) | |||||
Percentage of total revenues
|
22 | % | 26 | % | — |
2010
|
2009
|
Change
|
||||||||||
Sales and marketing
|
$ | 4,526 | $ | 6,307 | $ | (1,781 | ) | |||||
Percentage of total revenues
|
30 | % | 38 | % | — |
2010
|
2009
|
Change
|
||||||||||
General and administrative
|
$ | 5,368 | $ | 5,522 | $ | (154 | ) | |||||
Percentage of total revenues
|
35 | % | 34 | % | — |
Severance and
Benefits
|
Excess
Facilities
|
Total
|
||||||||||
Balance, March 31, 2009
|
$ | 52 | $ | 1,213 | $ | 1,265 | ||||||
Additional accruals
|
608 | 637 | 1,245 | |||||||||
Amounts paid in cash
|
(653 | ) | (1,850 | ) | (2,503 | ) | ||||||
Balance, March 31, 2010
|
$ | 7 | $ | — | $ | 7 |
2010
|
2009
|
Change
|
||||||||||
Other income (expense), net
|
$ | (373 | ) | $ | (2,122 | ) | $ | 1,749 |
2010
|
2009
|
Change
|
||||||||||
Interest income
|
$ | 50 | $ | 983 | $ | (933 | ) |
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Cash, cash equivalents and short-term investments
|
$ | 17,155 | $ | 23,452 | ||||
Working capital
|
$ | 15,494 | $ | 20,180 | ||||
Net cash used for operating activities
|
$ | (3,941 | ) | $ | (8,002 | ) | ||
Net cash provided by (used for) investing activities
|
$ | (212 | ) | $ | 10,470 | |||
Net cash used for financing activities
|
$ | (2,146 | ) | $ | (2,808 | ) |
Payments Due by Period
|
||||||||||||||||||||
Contractual Obligations
|
Total
|
Less than
1 Year
|
1-3 Years
|
3-5 years
|
More than
5 Years
|
|||||||||||||||
Operating lease—real estate
|
$ | 239 | $ | 154 | $ | 85 | $ | 0 | $ | 0 | ||||||||||
Versata note
|
4,822 | 786 | 1,992 | 1,328 | 716 | |||||||||||||||
Other
|
23 | 18 | 5 | 0 | 0 | |||||||||||||||
Total
|
$ | 5,084 | $ | 958 | $ | 2,082 | $ | 1,328 | $ | 716 |
Item 7A.
|
Quantitative and Qualitative Disclosures About Market Risk.
|
Item 8.
|
Financial Statements and Supplementary Data.
|
Report of Independent Registered Public Accounting Firm
|
28
|
Consolidated Balance Sheets as of March 31, 2010 and 2009
|
29
|
Consolidated Statements of Operations—Years ended March 31, 2010 and 2009
|
30
|
Consolidated Statements of Stockholders’ Equity—Years ended March 31, 2010 and 2009
|
31
|
Consolidated Statements of Cash Flows—Years ended March 31, 2010 and 2009
|
32
|
Notes to Consolidated Financial Statements
|
33
|
March 31,
|
||||||||
2010
|
2009
|
|||||||
(in thousands,
except par value)
|
||||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 16,957 | $ | 23,256 | ||||
Short-term investments
|
198 | 196 | ||||||
Accounts receivable, net of allowance for doubtful accounts of | ||||||||
$301 and $373, as of March 31, 2010 and 2009, respectively
|
4,242 | 5,598 | ||||||
Prepaid expenses and other current assets
|
538 | 2,485 | ||||||
Total current assets
|
21,935 | 31,535 | ||||||
Property and equipment, net
|
536 | 1,060 | ||||||
Intangible assets
|
— | 7 | ||||||
Other assets
|
24 | 665 | ||||||
Total assets
|
$ | 22,495 | $ | 33,267 | ||||
Liabilities and Stockholders’ Equity
|
||||||||
Current liabilities:
|
||||||||
Current portion of note payable to Versata
|
$ | 786 | $ | 786 | ||||
Accounts payable
|
609 | 3,133 | ||||||
Restructuring liability
|
7 | 1,265 | ||||||
Accrued payroll and related liabilities
|
483 | 720 | ||||||
Other accrued liabilities
|
56 | 1,520 | ||||||
Deferred revenues
|
4,500 | 3,931 | ||||||
Total current liabilities
|
6,441 | 11,355 | ||||||
Note payable to Versata, net of current portion
|
4,036 | 4,588 | ||||||
Other long-term liabilities
|
27 | 48 | ||||||
Total liabilities
|
10,504 | 15,991 | ||||||
Commitments and contingencies (See Notes 7 and 8)
|
||||||||
Stockholders’ equity:
|
||||||||
Preferred stock, $0.0001 par value:
|
||||||||
Authorized: 25,000 shares at March 31, 2010 and 2009; None issued and outstanding
|
— | — | ||||||
Common stock, $0.002 par value:
|
||||||||
Authorized: 150,000 shares at March 31, 2010 and 2009, respectively | ||||||||
Issued: 2,811 and 3,345 shares at March 31, 2010 and 2009, respectively | ||||||||
Outstanding: 2,811 and 2,777 shares at March 31, 2010 and 2009, respectively
|
4 | 4 | ||||||
Additional paid-in capital
|
265,836 | 299,383 | ||||||
Accumulated deficit
|
(253,849 | ) | (249,205 | ) | ||||
Treasury stock at cost— 0 and 568 shares at March 31, 2010 and 2009, respectively
|
— | (32,906 | ) | |||||
Total stockholders’ equity
|
11,991 | 17,276 | ||||||
Total liabilities and stockholders’ equity
|
$ | 22,495 | $ | 33,267 |
Fiscal Years Ended March 31,
|
||||||||
2010
|
2009
|
|||||||
(in thousands, except per share amounts)
|
||||||||
Revenues:
|
||||||||
License
|
$ | 3,182 | $ | 3,569 | ||||
Services
|
11,977 | 12,876 | ||||||
Total revenues
|
15,159 | 16,445 | ||||||
Cost of revenues:
|
||||||||
License
|
163 | 206 | ||||||
Services
|
5,291 | 5,563 | ||||||
Total cost of revenues
|
5,454 | 5,769 | ||||||
Gross profit
|
9,705 | 10,676 | ||||||
Operating expenses:
|
||||||||
Research and development
|
3,274 | 4,218 | ||||||
Sales and marketing
|
4,526 | 6,307 | ||||||
General and administrative
|
5,368 | 5,522 | ||||||
Restructuring
|
1,245 | 675 | ||||||
Professional fees related to corporate governance review
|
438 | — | ||||||
Reversal of payroll charges related to stock options
|
(541 | ) | — | |||||
Professional fees related to stock option investigation
|
— | 38 | ||||||
Shareholder litigation
|
34 | 92 | ||||||
Total operating expenses
|
14,344 | 16,852 | ||||||
Loss from operations
|
(4,639 | ) | (6,176 | ) | ||||
Other income (expense), net
|
(373 | ) | (2,122 | ) | ||||
Loss on sale of subsidiary
|
— | (950 | ) | |||||
Interest income
|
50 | 983 | ||||||
Loss before provision for income taxes
|
(4,962 | ) | (8,265 | ) | ||||
Provision for (benefit from) income taxes
|
(318 | ) | 157 | |||||
Net loss
|
$ | (4,644 | ) | $ | (8,422 | ) | ||
Basic and diluted net loss per share
|
$ | (1.66 | ) | $ | (5.13 | ) | ||
Weighted-average shares of common stock used in computing basic and diluted net loss per share
|
2,794 | 1,641 |
Accum-
ulated
|
|||||||||||||||||||||||||
Other | |||||||||||||||||||||||||
Compre-
hensive
|
Total | ||||||||||||||||||||||||
Common Stock |
Additional
Paid-In
|
Accum-
ulated
|
Income (Loss), | Treasury Stock |
Stock-
holders’
|
Compre-
hensive
|
|||||||||||||||||||
Shares | Amount | Capital | Deficit | net of taxes | Shares | Amount |
Equity
|
Loss | |||||||||||||||||
Balance at March 31, 2008
|
2,002 | $ | 4 | $ | 300,939 | $ | (240,783 | ) | $ | 4 | (568 | ) | $ | (32,906 | ) | $ | 27,258 | ||||||||
Stock-based compensation expense
|
— | — | 452 | — | — | — | — | 452 | |||||||||||||||||
Proceeds from sales of shares through employee stock purchase plan
|
3 | — | 26 | — | — | — | — | 26 | |||||||||||||||||
Issuance of additional common shares under Rights Agreement (see Note 8)
|
1,340 | — | — | — | — | — | — | — | |||||||||||||||||
Common stock issuance costs, net (see Note 8)
|
— | — | (2,034 | ) | — | — | — | — | (2,034 | ) | |||||||||||||||
Comprehensive loss:
|
|||||||||||||||||||||||||
Other comprehensive loss, net of taxes
|
— | — | — | — | (4 | ) | — | — | (4 | ) | $ | (4 | ) | ||||||||||||
Net loss
|
— | — | — | (8,422 | ) | — | — | — | (8,422 | ) | (8,422 | ) | |||||||||||||
Total comprehensive loss
|
$ | (8,426 | ) | ||||||||||||||||||||||
Balance at March 31, 2009
|
3,345 | $ | 4 | $ | 299,383 | $ | (249,205 | ) | $ | — | (568 | ) | $ | (32,906 | ) | $ | 17,276 | ||||||||
Stock-based compensation expense
|
— | — | 705 | — | — | — | — | 705 | |||||||||||||||||
Proceeds from sales of shares through employee stock purchase plan
|
4 | — | 19 | — | — | — | — | 19 | |||||||||||||||||
Issuance of additional common shares under Rights Agreement (see Note 8)
|
2 | — | — | — | — | — | — | — | |||||||||||||||||
Issuance of restricted stock, net of repurchase
|
36 | — | — | — | — | (8 | ) | (44 | ) | (44 | ) | ||||||||||||||
Retirement of treasury stock
|
(576 | ) | — | (32,950 | ) | — | — | 576 | 32,950 | — | |||||||||||||||
Common stock issuance costs, net (see Note 8)
|
— | — | (1,321 | ) | — | — | — | — | (1,321 | ) | |||||||||||||||
Comprehensive and net loss
|
— | — | — | (4,644 | ) | — | — | — | (4,644 | ) | $ | (4,644 | ) | ||||||||||||
Balance at March 31, 2010
|
2,811 | $ | 4 | $ | 265,836 | $ | (253,849 | ) | $ | — | — | $ | — | $ | 11,991 |
Fiscal Years Ended March 31,
|
||||||||
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Operating activities:
|
||||||||
Net loss
|
$ | (4,644 | ) | $ | (8,422 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||
Depreciation
|
380 | 394 | ||||||
Amortization
|
7 | 95 | ||||||
Loss on sale of subsidiary
|
— | 950 | ||||||
Loss on disposition of property and equipment
|
354 | 97 | ||||||
Stock-based compensation expense
|
705 | 452 | ||||||
Changes in assets and liabilities:
|
||||||||
Accounts receivable (net)
|
1,356 | (3,268 | ) | |||||
Prepaid expenses and other current assets
|
1,947 | (1,615 | ) | |||||
Other assets
|
641 | (180 | ) | |||||
Accounts payable
|
(2,524 | ) | 2,651 | |||||
Accrual for restructuring liability
|
(1,258 | ) | (1,585 | ) | ||||
Accrued payroll and related liabilities
|
(237 | ) | 6 | |||||
Other accrued and long-term liabilities
|
(1,237 | ) | 475 | |||||
Deferred revenues
|
569 | 1,948 | ||||||
Net cash used for operating activities
|
(3,941 | ) | (8,002 | ) | ||||
Investing activities:
|
||||||||
Proceeds from sale of subsidiary, net of cash contributed
|
— | 2,639 | ||||||
Purchase of capital assets
|
(213 | ) | (361 | ) | ||||
Proceeds from disposition of property and equipment
|
3 | 19 | ||||||
Purchase of short-term investments
|
(2 | ) | (9,169 | ) | ||||
Proceeds from maturities of short-term investments
|
— | 17,342 | ||||||
Net cash provided by (used for) investing activities
|
(212 | ) | 10,470 | |||||
Financing activities:
|
||||||||
Payments on note payable to Versata
|
(800 | ) | (800 | ) | ||||
Common stock issuance costs, net (See Note 8)
|
(1,321 | ) | (2,034 | ) | ||||
Proceeds from issuance of common stock, net
|
(25 | ) | 26 | |||||
Net cash used for financing activities
|
(2,146 | ) | (2,808 | ) | ||||
Effect of exchange rate changes on cash
|
— | 1,459 | ||||||
Net increase (decrease) in cash and cash equivalents
|
(6,299 | ) | 1,119 | |||||
Cash and cash equivalents at beginning of the period
|
23,256 | 22,137 | ||||||
Cash and cash equivalents at end of the period
|
$ | 16,957 | $ | 23,256 | ||||
Supplemental disclosure of cash flow information:
|
||||||||
Income taxes paid
|
$ | 3 | $ | 106 | ||||
Supplemental disclosure of non-cash financing activities:
|
||||||||
Change in unrealized gain (loss) on available for sales securities
|
$ | — | $ | (4 | ) |
1.
|
Organization and Operations
|
2.
|
Summary of Significant Accounting Policies
|
Fiscal Years Ended March 31,
|
||||||||
2010
|
2009
|
|||||||
Customer A
|
15 | % | 18 | % | ||||
Customer B
|
10 | % | * |
*
|
Revenues were less than 10% of total revenues.
|
Fiscal Years Ended March 31,
|
||||||||
2010
|
2009
|
|||||||
Customer A
|
15 | % | 13 | % | ||||
Customer B
|
* | 11 | % | |||||
Customer C
|
* | 21 | % | |||||
Customer D
|
12 | % | * | |||||
Customer E
|
10 | % | * |
*
|
Accounts receivable was less than 10% of total accounts receivable.
|
Fiscal Years Ended
March 31,
|
||||||||
2010
|
2009
|
|||||||
Cost of revenues
|
$ | 87,000 | $ | 85,000 | ||||
Research and development
|
99,000 | 172,000 | ||||||
Sales and marketing
|
73,000 | 63,000 | ||||||
General and administrative
|
446,000 | 132,000 | ||||||
Impact on net loss
|
$ | 705,000 | $ | 452,000 |
Fiscal Years Ended
March 31,
|
||||||||
2010
|
2009
|
|||||||
International revenues
|
4 | % | 6 | % | ||||
Domestic revenues
|
96 | % | 94 | % | ||||
Total revenues
|
100 | % | 100 | % |
3.
|
Cash, Cash Equivalents, Investments and Fair Value Measurements
|
Unrealized | ||||||||||||||||
Cost
|
Gain
|
Loss
|
Market
|
|||||||||||||
(in thousands)
|
||||||||||||||||
March 31, 2010:
|
||||||||||||||||
Cash and cash equivalents:
|
||||||||||||||||
Cash
|
$ | 1,902 | $ | — | $ | — | $ | 1,902 | ||||||||
Money market fund
|
15,055 | — | — | 15,055 | ||||||||||||
$ | 16,957 | $ | — | $ | — | $ | 16,957 | |||||||||
Short-term investments:
|
||||||||||||||||
(due in less than 12 months)
|
||||||||||||||||
Certificate of deposit
|
$ | 198 | $ | — | $ | — | $ | 198 |
Unrealized
|
||||||||||||||||
Cost
|
Gain
|
Loss
|
Market
|
|||||||||||||
(in thousands)
|
||||||||||||||||
March 31, 2009:
|
||||||||||||||||
Cash and cash equivalents:
|
||||||||||||||||
Cash
|
$ | 5,824 | $ | — | $ | — | $ | 5,824 | ||||||||
Money market fund
|
17,432 | — | — | 17,432 | ||||||||||||
$ | 23,256 | $ | — | $ | — | $ | 23,256 | |||||||||
Short-term investments:
|
||||||||||||||||
(due in less than 12 months)
|
||||||||||||||||
Certificate of deposit
|
$ | 196 | $ | — | $ | — | $ | 196 |
Description
|
Balance as of
March 31, 2010
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
Significant Other
Observable Inputs
(Level 2)
|
|||||||||
Cash equivalents:
|
||||||||||||
Money market fund
|
$ | 15,055 | $ | 15,055 | $ | — | ||||||
Short-term investments:
|
||||||||||||
Certificates of deposit
|
198 | — | 198 | |||||||||
$ | 15,253 | $ | 15,055 | $ | 198 |
Description
|
Balance as of
March 31, 2009
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
Significant Other
Observable Inputs
(Level 2)
|
|||||||||
Cash equivalents:
|
||||||||||||
Money market fund
|
$ | 17,432 | $ | 17,432 | $ | — | ||||||
Short-term investments:
|
||||||||||||
Certificates of deposit
|
196 | — | 196 | |||||||||
$ | 17,628 | $ | 17,432 | $ | 196 |
4.
|
Property and Equipment
|
March 31,
|
||||||||
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Computers and software
|
$ | 2,740 | $ | 2,760 | ||||
Furniture and equipment
|
601 | 651 | ||||||
Leasehold improvements
|
57 | 498 | ||||||
3,398 | 3,909 | |||||||
Less: accumulated depreciation
|
(2,862 | ) | (2,849 | ) | ||||
Total property and equipment, net
|
$ | 536 | $ | 1,060 |
5.
|
Accrued and Other Liabilities
|
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Accrued Payroll
|
||||||||
Accrued salaries
|
$ | — | $ | 57 | ||||
Accrued vacation
|
316 | 400 | ||||||
Accrued bonus
|
58 | — | ||||||
Accrued commissions
|
109 | 235 | ||||||
Accrued benefits
|
— | 28 | ||||||
Total
|
$ | 483 | $ | 720 |
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Other Accrued Liabilities
|
||||||||
Other payables
|
30 | 923 | ||||||
Accrued sales tax
|
24 | 23 | ||||||
Accrued other taxes
|
2 | 574 | ||||||
Total
|
$ | 56 | $ | 1,520 | ||||
Deferred Revenue
|
||||||||
License
|
$ | 20 | $ | — | ||||
Hosting
|
79 | 34 | ||||||
Consulting
|
169 | 32 | ||||||
Subscription
|
658 | 818 | ||||||
Maintenance
|
3,574 | 3,047 | ||||||
Total
|
$ | 4,500 | $ | 3,931 |
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Other Long-Term Liabilities
|
||||||||
Long-term deferred revenue
|
$ | 27 | $ | 48 |
6.
|
Intangible Assets
|
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Cost
|
$ | — | $ | 801 | ||||
Accumulated amortization
|
— | (794 | ) | |||||
Net
|
$ | — | $ | 7 |
7.
|
Operating Lease Commitments
|
Amount | ||||||||||
(in thousands)
|
||||||||||
Offices
|
Equipment
|
Total
|
||||||||
Fiscal 2011
|
$ | 154 | $ | 18 | $ | 172 | ||||
Fiscal 2012
|
85 | 3 | 88 | |||||||
Fiscal 2013
|
— | 2 | 2 | |||||||
Total future minimum payments
|
$ | 239 | $ | 23 | $ | 262 |
8.
|
Litigation
|
Year Ended
March 31, 2010
|
Year Ended
March 31, 2009
|
Total
|
||||||||||
Gross legal and related costs incurred
|
$ | 2,187 | $ | 2,864 | $ | 5,051 | ||||||
Less: received and anticipated reimbursement
|
(866 | ) | (830 | ) | (1,696 | ) (a) | ||||||
Net amounts charged to APIC
|
$ | 1,321 | $ | 2,034 | $ | 3,355 |
(a)
|
As of March 31, 2010, the Company has received approximately $1.6 million from its insurance carriers as reimbursement for the rights offering costs incurred in connection with the ongoing litigation with Trilogy.
|
9.
|
Stockholders’ Equity (Deficit)
|
(in thousands)
|
||||
Equity incentive plans:
|
||||
Outstanding
|
181 | |||
Reserved for future grants
|
1,551 | |||
Employee stock purchase plan
|
488 | |||
Total common stock reserved for future issuance
|
2,220 |
Options Outstanding | ||||||||||||
Shares
Available
for
Grant
|
Number
of
Shares
|
Exercise
Price
Per Share
|
Weighted-
Average
Exercise
Price Per
Share
|
|||||||||
(in thousands except for per share amounts)
|
||||||||||||
Balance at March 31, 2008
|
1,215 | 246 | $15.00 – $634.84 | $ | 24.84 | |||||||
Increase in shares reserved
|
168 | — | — | — | ||||||||
Options granted
|
(35 | ) | 36 | $7.20 – $14.50 | $ | 10.30 | ||||||
Options cancelled
|
148 | (148 | ) | $14.50 – $634.84 | $ | 21.82 | ||||||
Options expired
|
— | — | — | — | ||||||||
Restricted stock awards granted
|
(63 | ) | — | — | — | |||||||
Balance at March 31, 2009
|
1,433 | 134 | $7.20 – $527.00 | $ | 24.32 | |||||||
Increase in shares reserved
|
152 | — | — | — | ||||||||
Options granted
|
(9 | ) | 9 | $5.20 – $8.00 | $ | 5.56 | ||||||
Options cancelled
|
31 | (31 | ) | $5.20 – $300.00 | $ | 27.48 | ||||||
Options expired
|
— | — | — | — | ||||||||
Restricted stock awards issued
|
(56 | ) | — | — | — | |||||||
Balance at March 31, 2010
|
1,551 | 112 | $5.20 – $527.00 | $ | 21.86 |
Options Outstanding
|
Options Vested
|
||||||||||||||||
Range of Exercise
Prices Per Share
|
Number of
Shares
|
Weighted-
Average
Remaining
Contractual
Life (Years)
|
Number of
Shares
|
Weighted-
Average
Exercise
Price Per Share
|
|||||||||||||
$ | 5.20 – $10.00 | 22,766 | 7.66 | 5,826 | $ | 7.21 | |||||||||||
$ | 10.80 – $17.00 | 23,500 | 5.22 | 12,176 | $ | 14.44 | |||||||||||
$ | 18.10 – $18.90 | 26,150 | 7.48 | 18,816 | $ | 18.55 | |||||||||||
$ | 24.50 – $34.00 | 25,350 | 5.19 | 25,175 | $ | 30.97 | |||||||||||
$ | 34.40 – $527.00 | 14,465 | 2.72 | 14,465 | $ | 48.77 | |||||||||||
$ | 5.20 – $527.00 | 112,231 | 5.91 | 76,458 | $ | 26.84 |
Fiscal Years Ended
March 31,
|
|||||||
2010
|
2009
|
||||||
Weighted average grant date fair value
|
$ | 28,357 | $ | 130,021 | |||
Intrinsic value of options exercised
|
— | — | |||||
Fair value of shares vesting during the year
|
$ | 98,492 | $ | 202,639 |
Fiscal Years Ended
March 31,
|
||||||||
2010
|
2009
|
|||||||
Risk-free interest rate
|
1.53 | % | 2.19 | % | ||||
Dividend yield
|
0.00 | % | 0.00 | % | ||||
Expected volatility
|
69.52 | % | 41.49 | % | ||||
Expected term in years
|
1.64 | 1.24 | ||||||
Weighted average fair value at grant date
|
$ | 10.60 | $ | 5.20 |
Fiscal Years Ended
March 31,
|
||||||||
2010
|
2009
|
|||||||
Risk-free interest rate
|
1.62 | % | 1.65 | % | ||||
Dividend yield
|
0.00 | % | 0.00 | % | ||||
Expected volatility
|
82.06 | % | 50.59 | % | ||||
Expected option life in years
|
3.06 | 3.24 | ||||||
Weighted average fair value at grant date
|
$ | 2.99 | $ | 3.66 |
Number of
Securities
to be
Issued upon
Exercise
of Outstanding
Options,
and
Rights
|
Weighted-
Average
Exercise
Price Per
Share of
Outstanding
Options
and Rights
|
Number of
Securities
Remaining
Available
for Future
Issuance
Under Equity
Compensation
Plans
|
||||||||||
(in thousands, except for per share amount)
|
||||||||||||
Plans Approved by Stockholders
|
||||||||||||
1996 Stock Plan
|
6 | $ | 35.04 | 142 | ||||||||
1999 Equity Incentive Plan
|
172 | $ | 20.58 | 1,228 | ||||||||
Plans Not Required to be Approved by Stockholders
|
||||||||||||
2001 Supplemental Plan
|
3 | $ | 38.91 | 181 | ||||||||
Total
|
181 | $ | 21.86 | 1,551 |
10.
|
Computation of Basic and Diluted Net Loss Per Share
|
Fiscal Years Ended
March 31,
|
|||||||
2010
|
2009
|
||||||
(In thousands)
|
|||||||
Weighted options excluded due to the exercise price exceeding the average | |||||||
fair market value of the Company’s common stock during the period
|
114 | 149 | |||||
Weighted options excluded for which the exercise price was less than the average | |||||||
fair market value of the Company’s common stock during the period but were | |||||||
excluded as inclusion would decrease the Company’s net loss per share
|
2 | 5 | |||||
Total common stock equivalents excluded from diluted net loss per common share
|
116 | 154 |
11.
|
Income Taxes
|
Fiscal Years Ended
March 31,
|
||||||||
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Domestic pre-tax loss
|
$ | (5,486 | ) | $ | (4,682 | ) | ||
Foreign pre-tax loss
|
(7 | ) | (3,582 | ) | ||||
Total pre-tax loss
|
$ | (5,493 | ) | $ | (8,264 | ) |
Fiscal Years Ended
March 31,
|
||||||||
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Federal tax at statutory rate
|
$ | (1,868 | ) | $ | (2,810 | ) | ||
Computed state tax
|
(308 | ) | 934 | |||||
Computed foreign tax
|
3 | 1,557 | ||||||
Losses not benefited
|
1,700 | 270 | ||||||
Change in tax reserve
|
266 | 12 | ||||||
Non-deductible expenses
|
40 | 321 | ||||||
Research and development tax credits
|
(151 | ) | (127 | ) | ||||
Income tax provision (benefit)
|
$ | (318 | ) | $ | 157 |
Fiscal Years Ended
March 31,
|
||||||||
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Current:
|
||||||||
US
|
$ | (258 | ) | $ | 15 | |||
State
|
(60 | ) | $ | — | ||||
Foreign
|
— | 142 | ||||||
Income tax provision (benefit)
|
$ | (318 | ) | $ | 157 |
March 31,
|
||||||||
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Deferred tax assets:
|
||||||||
Net operating loss carryforwards
|
$ | 65,405 | $ | 61,649 | ||||
Intangible assets
|
15,538 | 16,063 | ||||||
Tax credit carryforwards
|
4,563 | 4,519 | ||||||
Reserves and accruals
|
262 | 1,227 | ||||||
Depreciation
|
(13 | ) | (17 | ) | ||||
Stock compensation
|
296 | 326 | ||||||
Deferred revenue
|
39 | 132 | ||||||
Total net deferred tax asset
|
86,090 | 83,899 | ||||||
Valuation allowance
|
(86,090 | ) | (83,899 | ) | ||||
Net deferred tax assets
|
$ | — | $ | — |
Amount
|
||||
Balance at April 1, 2009
|
$ | 1,820 | ||
Increases related to prior year research & development tax credits
|
439 | |||
Decreases related to expiration of tax credits and statute of limitations
|
(278 | ) | ||
Balance at March 31, 2010
|
$ | 1,981 |
12.
|
401(k) Benefit Plan
|
13.
|
Restructuring
|
Severance and
Benefits
|
Excess
Facilities
|
Total
|
||||||||||
Balance, March 31, 2008
|
$ | 126 | $ | 2,705 | $ | 2,831 | ||||||
Additional accruals
|
661 | (143 | ) | 518 | ||||||||
Amounts paid in cash
|
(735 | ) | (1,812 | ) | (2,547 | ) | ||||||
Loan to sublessee
|
— | 463 | 463 | |||||||||
Balance, March 31, 2009
|
52 | 1,213 | 1,265 | |||||||||
Additional accruals
|
608 | 637 | 1,245 | |||||||||
Amounts paid in cash
|
(653 | ) | (1,850 | ) | (2,503 | ) | ||||||
Balance, March 31, 2010
|
$ | 7 | $ | — | $ | 7 |
14.
|
Segment Information
|
Fiscal Years Ended
March 31,
|
||||||||
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Sales Configuration Solutions:
|
||||||||
Revenues
|
$ | 5,665 | $ | 6,552 | ||||
Cost of Sales
|
1,116 | 1,625 | ||||||
Gross Profit
|
4,549 | 4,927 | ||||||
Income from Operations
|
3,455 | 2,134 | ||||||
Contract Management Solutions:
|
||||||||
Revenues
|
9,494 | 9,893 | ||||||
Cost of Sales
|
4,338 | 4,144 | ||||||
Gross Profit
|
5,156 | 5,749 | ||||||
Loss from Operations
|
(1,550 | ) | (1,983 | ) | ||||
Unallocated Corporate Expenses
|
6,544 | 6,327 |
15.
|
Sale of Indian Subsidiary
|
Item 9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
|
Item 9A.
|
Controls and Procedures.
|
Item 9B.
|
Other Information.
|
Item 10.
|
Directors, Executive Officers and Corporate Governance.
|
Item 11.
|
Executive Compensation.
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence
|
Item 14.
|
Principal Accounting Fees and Services.
|
Item 15.
|
Exhibits and Financial Statement Schedules.
|
Balance at
Beginning
of Period
|
Additions to
Costs and
Expenses
|
Write
Offs
|
Reversal
Benefit to
Revenue
|
Balance
at End of
Period
|
||||||||||||||||
Allowance for doubtful accounts:
|
||||||||||||||||||||
Fiscal year ended March 31, 2009
|
$ | — | $ | 373 | $ | — | $ | — | $ | 373 | ||||||||||
Fiscal year ended March 31, 2010
|
$ | 373 | $ | 284 | $ | (356) | $ | — | $ | 301 |
SELECTICA, INC.
Registrant
|
||||
|
/s/ JASON STERN
|
|||
|
Jason Stern
President and Chief Operating Officer
|
|
/s/ TODD SPARTZ
|
|||
|
Todd Spartz
Chief Financial Officer
|
Signature
|
Title
|
Date
|
||||
/s/ JASON STERN
|
President and Chief Operating Officer
|
June 29, 2010
|
||||
Jason Stern | (Principal Executive Officer) | |||||
/s/ TODD SPARTZ
|
Chief Financial Officer (Principal Financial Officer
|
June 29, 2010
|
||||
Todd Spartz | and Principal Accounting Officer), and Secretary | |||||
Directors:
|
||||||
/s/ J
AMIE
A
RNOLD
|
Director
|
June 29, 2010
|
||||
Jamie Arnold
|
||||||
/s/ B
RENDA
Z
AWATSKI
|
Director
|
June 29, 2010
|
||||
Brenda Zawatski | ||||||
/s/ L
LOYD
S
EMS
|
Director
|
June 29, 2010
|
||||
Lloyd Sems | ||||||
/s/ J
IM
T
HANOS
|
Director
|
June 29, 2010
|
||||
Jim Thanos | ||||||
/s/ A
LAN
H
OWE
|
Director
|
June 29, 2010
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Alan Howe |
Exhibit
No.
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Description
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3.1
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The Second Amended and Restated Certificate of Incorporation, as amended.
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3.2(3)
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Certificate of Designation of Series A Junior or Participating Preferred Stock.
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3.3(3)
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Amended and Restated Bylaws.
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3.4(12)
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Certificate of Designation of Series B Junior or Participating Preferred Stock.
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4.1
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Reference is made to Exhibits 3.1, 3.2, 3.3 and 3.4.
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4.2(1)
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Form of Registrant’s Common Stock certificate.
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4.3(1)
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Amended and Restated Investor Rights Agreement, dated June 16, 1999.
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4.4(9)
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Transfer Agent Agreement between Registrant and Wells Fargo Corporation, as Transfer Agent, dated February 13, 2007
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4.5(12)
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Amended and Restated Rights Agreement between Registrant and Computershare Trust Company, N.A., as Rights Agent, dated January 2, 2009.
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4.6(13)
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Amendment dated as of January 26, 2009, to the Amended and Restated Rights Agreement between Registrant and Computershare Trust Company, N.A. as Rights Agent, dated January 2, 2009.
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4.7(17)
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Amendment 2, dated as of May 8, 2009, between Registrant and Wells Fargo Bank, N.A., as Rights Agent, to the Amended and Restated Rights Agreement between Registrant and Computershare Trust Company, N.A., dated January 2, 2009, as amended,
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10.1(1)
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Form of Indemnification Agreement.
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10.2(1)*
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1996 Stock Plan.
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10.3(1)
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Lease between John Arrillaga Survivors Trust and the Richard T. Perry Separate Property Trust as Landlord and the Registrant as Tenant, dated October 1, 1999.
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10.4(2)*
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Employment Agreement between the Registrant and Stephen Bennion, dated as of January 1, 2003.
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10.5(5)
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Sublease Agreement between Selectica Incorporated and Nuova Systems, dated March 6, 2007
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10.6(6)*
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Employment Agreement between the Registrant and Stephen Bennion, dated August 9, 2006.
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10.7(9)*
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Employment Agreement between the Registrant and Bill Roeschlein, dated September 11, 2006.
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10.8(9)*
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Employment Agreement between the Registrant and Steve Goldner, dated September 27, 2006.
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10.9(9)*
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Employment Agreement between the Registrant and Terry Nicholson, dated September 27, 2006.
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10.10(3)
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Warrant to Purchase Common Stock issued to Sales Technologies Limited, dated April 4, 2001.
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10.11(3)
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Licensed Works Agreement between the Registrant and International Business Machines Corporation, dated December 11, 2002.
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10.12(3)
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Licensed Works Agreement Statement of Work between the Registrant and International Business Machines Corporation, dated December 11, 2002.
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10.13(3)
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Professional Services Agreement between the Registrant and GE Medical Services, dated June 28, 2002.
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10.14(3)
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Major Account License Agreement between the Registrant and GE Medical Systems, dated June 28, 2002.
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10.15(3)
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Amendment #1 to Major Account License Agreement between the Registrant and GE Medical Systems.
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Exhibit
No.
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Description
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10.16(3)
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Amendment #2 to Major Account License Agreement between the Registrant and GE Medical Systems, dated October 8, 2002.
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10.17(3)
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Amendment #3 to Major Account License Agreement between the Registrant and GE Medical Systems, dated March 31, 2003.
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10.18(3)
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Amendment #1 to Professional Services Agreement between Registrant and GE Medical Services, dated August 27, 2002.
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10.19(3)
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Amendment #2 to Professional Services Agreement between Registrant and GE Medical Services, dated March 3, 2003.
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10.20(9)*
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Company Compensation Plan for Non Employee Directors, dated August 1, 2006.
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10.21(7)
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Letter Agreement between Registrant and Sanjay Mittal, dated July 21, 2006.
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10.22(6)
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Separation Agreement between Registrant and Vince Ostrosky, dated August 9, 2006.
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10.23(4)*
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1999 Equity Incentive Plan Stock Option Agreement.
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10.24(4)*
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1999 Equity Incentive Plan Stock Option Agreement (Initial Grant to Directors).
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10.25(4)*
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1999 Equity Incentive Plan Stock Option Agreement (Annual Grant to Directors).
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10.26(4)
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Selectica UK Limited Major Account License Agreement, dated December 5, 2003.
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10.27(4)
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Amendment Agreement between MCI WorldCom, Limited and Selectica UK Limited, dated December 23, 2004.
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10.28(8)
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Notice of Delisting, dated June 19, 2007.
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10.29(10)
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Separation Agreement between Registrant and Stephen Bennion, dated October 23, 2007.
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10.30(11)
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Severance Agreement between Registrant and William Roeschlein, dated September 27, 2006.
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10.31(11)
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Severance Agreement between Registrant and Michael Shaw, dated January 14, 2008.
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10.32(11)*
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Employment Agreement between the Registrant and Robert Jurkowski, dated August 21, 2007.
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10.33(11)*
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Offer Letter between Registrant and Michael Shaw, dated January 9, 2008.
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10.34(15)*
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Employment Agreement between the Registrant and Richard Heaps, dated September 5, 2008.
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10.35(15)
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Severance Agreement between the Registrant and Richard Heaps, dated September 4, 2008.
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10.36(16)
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Share Purchase Agreement between the Registrant and DAX Partners, L.P., dated March 31, 2009.
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10.37(18)
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1999 Employee Stock Purchase Plan, as amended and restated February 1, 2008.
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10.39(18)
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Form of Stock Unit Agreement for issuance of restricted stock units pursuant to the Registrant’s 1999 Equity Incentive Plan to plan participants, including named executive officers.
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10.40(18)
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Registrant Compensation Program for Non-Employee Directors effective January 2, 2009.
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10.41(18)
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Registrant Compensation Program for Non-Employee Directors effective May 20, 2009.
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10.42(18)
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Registrant Master Software License Agreement with CA, Inc., dated February 13, 2009.
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10.43(18)
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Settlement, Release and License Agreement between Registrant and Versata Software Inc., a corporation f/k/a Trilogy Software, Inc., dated October 5, 2007.
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10.44(18)
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Summary of Registrant’s Board Co-Chairs Compensation Arrangement.
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10.45(19)
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Severance Agreement between the Registrant and Todd Spartz, dated September 14, 2009.
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10.46(19)
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Offer Letter between the Registrant and Todd Spartz, dated August 18, 2009.
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10.47(19)
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Severance Agreement between the Registrant and Jason Stern, dated June 10, 2009.
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Exhibit
No.
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Description
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10.48(19)
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Offer Letter between the Registrant and Jason Stern, dated September 1, 2009. | |
10.49* | 1999 Equity Incentive Plan, as amended May 2010. | |
21.1(18)
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Subsidiaries.
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23.1
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Consent of Independent Registered Public Accounting Firm.
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24.1
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Power of Attorney (contained in the signature page to this Annual Report on Form 10-K).
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31.1**
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Certification of President and Chief Operating Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
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31.2**
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Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
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32.1**
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Certification of President and Chief Operating Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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32.2**
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Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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99.1(14)
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Trust Agreement, dated January 27, 2009, between Registrant and Wilmington Trust Company, as trustee.
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(1)
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Previously filed in the Company’s Registration Statement (No. 333-92545) declared effective on March 9, 2000.
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(2)
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Previously filed in the Company’s report on Form 10-Q filed on February 14, 2003.
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(3)
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Previously filed in the Company’s report on Form 10-K filed on June 30, 2003.
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(4)
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Previously filed in the Company’s report on Form 10-K filed on June 29, 2006.
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(5)
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Previously filed in the Company’s report on Form 8-K filed on March 27, 2008.
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(6)
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Previously filed in the Company’s report on Form 8-K on August 15, 2007.
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(7)
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Previously filed in the Company’s report on Form 8-K on July 27, 2007.
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(8)
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Previously filed in the Company’s report on Form 8-K on June 22, 2008.
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(9)
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Previously filed in the Company’s report on Form 10-K on October 3, 2007
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(10)
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Previously filed in the Company’s report on Form 8-K on October 23, 2007.
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(11)
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Previously filed in the Company’s report on Form 10-KSB filed on June 10, 2008.
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(12)
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Previously filed in the Company’s report on Form 8-K on January 2, 2009.
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(13)
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Previously filed in the Company’s report on Form 8-K on January 28, 2009.
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(14)
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Previously filed in the Company’s report on Form 8-K filed on February 4, 2009.
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(15)
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Previously filed in the Company’s report on Form 10-Q filed on February 17, 2009.
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(16)
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Previously filed in the Company’s report on Form 8-K filed on April 6, 2009.
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(17)
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Previously filed in the Company’s report on Form 8-K filed on April 28, 2009.
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(18)
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Previously filed in the Company’s report on Form 10-K filed on July 9, 2009.
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(19)
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Previously filed in the Company’s report on Form 10-Q filed on November 16, 2009.
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*
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Represents a management agreement or compensatory plan.
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**
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This certification is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act, or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that Selectica, Inc. specifically incorporates it by reference.
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Page |
ARTICLE 1. INTRODUCTION
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1 |
ARTICLE 2. ADMINISTRATION
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2.1 Committee Composition
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2.2 Committee Responsibilities
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2.3 Committee for Non-Officer Grants
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ARTICLE 3. SHARES AVAILABLE FOR GRANTS
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2 |
3.1 Basic Limitation
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3.2 Annual Increase in Shares
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2 |
3.3 Additional Shares
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3.4 Dividend Equivalents
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ARTICLE 4. ELIGIBILITY
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3 |
4.1 Incentive Stock Options
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4.2 Other Grants
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3 |
ARTICLE 5. OPTIONS
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3 |
5.1 Stock Option Agreement
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3 |
5.2 Number of Shares
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5.3 Exercise Price
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5.4 Exercisability and Term
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5.5 Modification or Assumption of Options
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5.6 Buyout Provisions
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ARTICLE 6. PAYMENT FOR OPTION SHARES
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6.1 General Rule
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6.2 Surrender of Stock
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6.3 Exercise/Sale
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6.4 Promissory Note
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6.5 Other Forms of Payment
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ARTICLE 7. STOCK APPRECIATION RIGHTS
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7.1 SAR Agreement
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7.2 Number of Shares
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7.3 Exercise Price
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7.4 Exercisability and Term
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7.5 Exercise of SARs
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7.6 Modification or Assumption of SARs
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ARTICLE 8. RESTRICTED SHARES
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6 |
8.1 Restricted Stock Agreement
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8.2 Payment for Awards
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8.3 Vesting Conditions
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8.4 Voting and Dividend Rights
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ARTICLE 9. STOCK UNITS
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6 |
9.1 Stock Unit Agreement
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9.2 Payment for Awards
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9.3 Vesting Conditions
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9.4 Voting and Dividend Rights
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9.5 Form and Time of Settlement of Stock Units
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9.6 Death of Recipient
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9.7 Creditors’ Rights
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ARTICLE 10. PROTECTION AGAINST DILUTION
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10.1 Adjustments
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10.2 Dissolution or Liquidation
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10.3 Reorganizations
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ARTICLE 11. CHANGE IN CONTROL
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ARTICLE 12. AWARDS UNDER OTHER PLANS.
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ARTICLE 13. PAYMENT OF DIRECTOR’S FEES IN SECURITIES
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13.1 Effective Date
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13.2 Elections to Receive NSOs, Restricted Shares or Stock Units
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13.3 Number and Terms of NSOs, Restricted Shares or Stock Units
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ARTICLE 14. LIMITATION ON RIGHTS
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14.1 Retention Rights
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14.2 Stockholders’ Rights
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14.3 Regulatory Requirements
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ARTICLE 15. WITHHOLDING TAXES
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15.1 General
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15.2 Share Withholding
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ARTICLE 16. FUTURE OF THE PLAN
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16.1 Term of the Plan
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16.2 Amendment or Termination
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ARTICLE 17. LIMITATION ON PAYMENTS
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17.1 Scope of Limitation
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17.2 Basic Rule
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17.3 Reduction of Payments
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17.4 Overpayments and Underpayments
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17.5 Related Corporations
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ARTICLE 18. DEFINITIONS
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/s/ Armanino McKenna LLP
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San Ramon, California
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June 29, 2010
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1)
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I have reviewed this annual report on Form 10-K of Selectica, Inc;
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2)
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3)
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4)
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5)
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ JASON STERN
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Jason Stern
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President and Chief Operating Officer
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1)
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I have reviewed this annual report on Form 10-K of Selectica, Inc;
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2)
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3)
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4)
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5)
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ TODD SPARTZ
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Todd Spartz
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Chief Financial Officer
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
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/s/ JASON STERN
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Jason Stern
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President and Chief Operating Officer
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
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/s/ TODD SPARTZ
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Todd Spartz
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Chief Financial Officer
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