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                                                                    EXHIBIT 10.2


                                  VERSATA, INC.

                          EMPLOYEE STOCK PURCHASE PLAN

      I.    PURPOSE OF THE PLAN

            This Employee Stock Purchase Plan is intended to promote the
interests of Versata, Inc., a Delaware corporation, by providing eligible
employees with the opportunity to acquire a proprietary interest in the
Corporation through participation in a payroll deduction based employee stock
purchase plan designed to qualify under Section 423 of the Code.

            Capitalized terms herein shall have the meanings assigned to such
terms in the attached Appendix.

      II.   ADMINISTRATION OF THE PLAN

            The Plan Administrator shall have full authority to interpret and
construe any provision of the Plan and to adopt such rules and regulations for
administering the Plan as it may deem necessary in order to comply with the
requirements of Code Section 423. Decisions of the Plan Administrator shall be
final and binding on all parties having an interest in the Plan.

      III.  STOCK SUBJECT TO PLAN

            A. The stock purchasable under the Plan shall be shares of
authorized but unissued or reacquired Common Stock, including shares of Common
Stock purchased on the open market. The number of shares of Common Stock
initially reserved for issuance over the term of the Plan shall be limited to
500,000 shares.

            B. The number of shares of Common Stock available for issuance under
the Plan shall automatically increase on the first trading day of the second
fiscal quarter each year, beginning in the year 2000, by an amount equal to one
percent (1%) of the total number of shares of Common Stock outstanding on the
last trading day of the immediately preceding first fiscal quarter, but in no
event shall any such annual increase exceed 1,000,000 shares.

            C. Should any change be made to the Common Stock by reason of any
stock split, stock dividend, recapitalization, combination of shares, exchange
of shares or other change affecting the outstanding Common Stock as a class
without the Corporation's receipt of consideration, appropriate adjustments
shall be made to (i) the maximum number and class of securities issuable under
the Plan, (ii) the maximum number and class of securities purchasable per
Participant on any one Purchase Date, (iii) the maximum number and class of
securities purchasable in total by all Participants on any one Purchase Date,
(iv) the maximum number and/or class of securities by which the share reserve is
to increase automatically each calendar year pursuant to the provisions of
Section III.B of this Article One and (v) the number and class of securities and
the price per share in effect under each outstanding purchase right in order to
prevent the dilution or enlargement of benefits thereunder.


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      IV.   OFFERING PERIODS

            A. Shares of Common Stock shall be offered for purchase under the
Plan through a series of successive overlapping offering periods until such time
as (i) the maximum number of shares of Common Stock available for issuance under
the Plan shall have been purchased or (ii) the Plan shall have been sooner
terminated.

            B. Offering periods shall commence at semi-annual intervals on the
first business day of February and August each year over the term of the Plan.
Accordingly, two (2) separate offering periods shall commence in each calendar
year over the term of the Plan. Each offering period shall be of twenty-four
(24) months' duration unless otherwise determined by the Plan Administrator
prior to the start date of such offering period. However, the initial offering
period shall commence at the Effective Time and terminate on the last business
day in January 2002. The second offering period shall commence on the first
business day in August 2000 and terminate on the last business day in July 2002.
The date on which an offering period begins shall be designated the Start Date
of such offering period.

            C. Each offering period shall be comprised of a series of one or
more successive Purchase Intervals. Purchase Intervals shall run from the first
business day in February to the last business day in July each year and from the
first business day in August each year to the last business day in January in
the following year. However, the first Purchase Interval in effect under the
initial offering period shall commence at the Effective Time and terminate on
the last business day in July 2000.

            D. Should the Fair Market Value per share of Common Stock on any
Purchase Date within an offering period be less than the Fair Market Value per
share of Common Stock on the Start Date of that offering period, then that
offering period shall automatically terminate immediately after the purchase of
shares of Common Stock on such Purchase Date and participants in such terminated
offering period shall automatically be enrolled in the new offering period
commencing on the next business day following such Purchase Date.

      V.    ELIGIBILITY

            A. Each individual who is an Eligible Employee on the Start Date of
any offering period under the Plan may enter that offering period on such start
date.

            B. Each individual who first becomes an Eligible Employee after the
start date of an offering period may enter a subsequent offering period on the
Start Date of that offering period.

            C. An Eligible Employee may participate in only one offering period
at any time.

            D. Except as provided in Section IV.D above, to participate in the
Plan for a particular offering period, the Eligible Employee must complete the
enrollment forms prescribed by the Plan Administrator (including a stock
purchase agreement and a payroll deduction authorization) and file such forms
with the Plan Administrator (or its designate) on or before the scheduled Start
Date of such offering period.



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      VI.   PAYROLL DEDUCTIONS

            A. The payroll deduction authorized by the Participant for purposes
of acquiring shares of Common Stock during an offering period may be any
multiple of one percent (1%) of the Cash Earnings paid to the Participant on
each payroll date during each Purchase Interval within that offering period, up
to a maximum of fifteen percent (15%). The deduction rate so authorized shall
continue in effect throughout the offering period, except to the extent such
rate is changed in accordance with the following guidelines:

                  (i) The Participant may, at any time during the offering
      period, reduce his or her rate of payroll deduction to become effective as
      soon as possible after filing the appropriate form with the Plan
      Administrator. The Participant may not, however, effect more than one (1)
      such reduction per Purchase Interval.

                  (ii) The Participant may, prior to the commencement of any new
      Purchase Interval within the offering period, increase the rate of his or
      her payroll deduction by filing the appropriate form with the Plan
      Administrator. The new rate (which may not exceed the fifteen percent
      (15%) maximum) shall become effective on the start date of the first
      Purchase Interval following the filing of such form.

            B. Payroll deductions shall begin on the first pay day
administratively feasible following the Start Date of the offering period and
shall (unless sooner terminated by the Participant) continue through the pay day
ending with or immediately prior to the last day of that offering period. The
amounts so collected shall be credited to the Participant's book account under
the Plan, but no interest shall be paid on the balance from time to time
outstanding in such account. The amounts collected from the Participant shall
not be required to be held in any segregated account or trust fund and may be
commingled with the general assets of the Corporation and used for general
corporate purposes.

            C. Payroll deductions shall automatically cease upon the termination
of the Participant's purchase right in accordance with the provisions of the
Plan.

            D. The Participant's acquisition of Common Stock under the Plan on
any Purchase Date shall neither limit nor require the Participant's acquisition
of Common Stock on any subsequent Purchase Date, whether within the same or a
different offering period.

      VII.  PURCHASE RIGHTS

            A. GRANT OF PURCHASE RIGHTS. A Participant shall be granted a
separate purchase right for each offering period in which he or she
participates. The purchase right shall be granted on the Start Date of the
offering period and shall provide the Participant with the right to purchase
shares of Common Stock, in a series of successive installments over the
remainder of such offering period, upon the terms set forth below. The
Participant shall execute a stock purchase agreement embodying such terms and
such other provisions (not inconsistent with the Plan) as the Plan Administrator
may deem advisable.



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            Under no circumstances shall purchase rights be granted under the
Plan to any Eligible Employee if such individual would, immediately after the
grant, own (within the meaning of Code Section 424(d)) or hold outstanding
options or other rights to purchase, stock possessing five percent (5%) or more
of the total combined voting power or value of all classes of stock of the
Corporation or any Corporate Affiliate.

            B. EXERCISE OF THE PURCHASE RIGHT. Each purchase right shall be
automatically exercised in installments on each successive Purchase Date within
the offering period, and shares of Common Stock shall accordingly be purchased
on behalf of each Participant on each such Purchase Date. The purchase shall be
effected by applying the Participant's payroll deductions for the Purchase
Interval ending on such Purchase Date to the purchase of whole shares of Common
Stock at the purchase price in effect for the Participant for that Purchase
Date.

            C. PURCHASE PRICE. The purchase price per share at which Common
Stock will be purchased on the Participant's behalf on each Purchase Date within
the offering period shall be equal to eighty-five percent (85%) of the lower of
(i) the Fair Market Value per share of Common Stock on the Start Date of that
offering period or (ii) the Fair Market Value per share of Common Stock on that
Purchase Date.

            D. NUMBER OF PURCHASABLE SHARES. The number of shares of Common
Stock purchasable by a Participant on each Purchase Date during the offering
period shall be the number of whole shares obtained by dividing the amount
collected from the Participant through payroll deductions during the Purchase
Interval ending with that Purchase Date by the purchase price in effect for the
Participant for that Purchase Date. However, the maximum number of shares of
Common Stock purchasable per Participant on any one Purchase Date shall not
exceed 2,500 shares, subject to periodic adjustments in the event of certain
changes in the Corporation's capitalization. In addition, the maximum number of
shares of Common Stock purchasable in total by all Participants on any one
Purchase Date shall not exceed 125,000 shares, subject to periodic adjustments
in the event of certain changes in the Corporation's capitalization. However,
the Plan Administrator shall have the discretionary authority, exercisable prior
to the start of any offering period under the Plan, to increase or decrease the
limitations to be in effect for the number of shares purchasable per Participant
and in total by all Participants on each Purchase Date during that offering
period.

            E. EXCESS PAYROLL DEDUCTIONS. Any payroll deductions not applied to
the purchase of shares of Common Stock on any Purchase Date because they are not
sufficient to purchase a whole share of Common Stock shall be held for the
purchase of Common Stock on the next Purchase Date. However, any payroll
deductions not applied to the purchase of Common Stock by reason of the
limitation on the maximum number of shares purchasable per Participant or in
total by all Participants on the Purchase Date shall be promptly refunded.

            F. TERMINATION OF PURCHASE RIGHT. The following provisions shall
govern the termination of outstanding purchase rights:

                  (i) A Participant may, at any time prior to the next scheduled
      Purchase Date in the offering period, terminate his or her outstanding



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      purchase right by filing the appropriate form with the Plan Administrator
      (or its designate), and no further payroll deductions shall be collected
      from the Participant with respect to the terminated purchase right. Any
      payroll deductions collected during the Purchase Interval in which such
      termination occurs shall, at the Participant's election, be immediately
      refunded or held for the purchase of shares on the next Purchase Date. If
      no such election is made at the time such purchase right is terminated,
      then the payroll deductions collected with respect to the terminated right
      shall be refunded as soon as possible.

                  (ii) The termination of such purchase right shall be
      irrevocable, and the Participant may not subsequently rejoin the offering
      period for which the terminated purchase right was granted. In order to
      resume participation in any subsequent offering period, such individual
      must re-enroll in the Plan (by making a timely filing of the prescribed
      enrollment forms) on or before the scheduled Start Date of that offering
      period.

                  (iii) Should the Participant cease to remain an Eligible
      Employee for any reason (including death, disability or change in status)
      while his or her purchase right remains outstanding, then that purchase
      right shall immediately terminate, and all of the Participant's payroll
      deductions for the Purchase Interval in which the purchase right so
      terminates shall be immediately refunded. However, should the Participant
      cease to remain in active service by reason of an approved unpaid leave of
      absence, then the Participant shall have the right, exercisable up until
      the last business day of the Purchase Interval in which such leave
      commences, to (a) withdraw all the payroll deductions collected to date on
      his or her behalf for that Purchase Interval or (b) have such funds held
      for the purchase of shares on his or her behalf on the next scheduled
      Purchase Date. In no event, however, shall any further payroll deductions
      be collected on the Participant's behalf during such leave. Upon the
      Participant's return to active service (x) within ninety (90) days
      following the commencement of such leave or (y) prior to the expiration of
      any longer period for which such Participant's right to reemployment with
      the Corporation is guaranteed by statute or contract, his or her payroll
      deductions under the Plan shall automatically resume at the rate in effect
      at the time the leave began, unless the Participant withdraws from the
      Plan prior to his or her return. An individual who returns to active
      employment following a leave of absence which exceeds in duration the
      applicable (x) or (y) time period will be treated as a new Employee for
      purposes of subsequent participation in the Plan and must accordingly
      re-enroll in the Plan (by making a timely filing of the prescribed
      enrollment forms) on or before the scheduled Start Date of the offering
      period.

            G. CHANGE IN CONTROL. Each outstanding purchase right shall
automatically be exercised, immediately prior to the effective date of any
Change in Control, by applying the payroll deductions of each Participant for
the Purchase Interval in which such Change in Control occurs to the purchase of
whole shares of Common Stock at a purchase price per share equal to eighty-five
percent (85%) of the lower of (i) the Fair Market Value per share of Common
Stock on the Start Date of the offering period in which such Change in Control
occurs or (ii) the Fair



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Market Value per share of Common Stock immediately prior to the effective date
of such Change in Control. However, the applicable limitation on the number of
shares of Common Stock purchasable per Participant shall continue to apply to
any such purchase, but not the limitation applicable to the maximum number of
shares of Common Stock purchasable in total by all Participants on any one
Purchase Date.

            The Corporation shall use its best efforts to provide at least ten
(10)-days prior written notice of the occurrence of any Change in Control, and
Participants shall, following the receipt of such notice, have the right to
terminate their outstanding purchase rights prior to the effective date of the
Change in Control.

            H. PRORATION OF PURCHASE RIGHTS. Should the total number of shares
of Common Stock to be purchased pursuant to outstanding purchase rights on any
particular date exceed the number of shares then available for issuance under
the Plan, the Plan Administrator shall make a pro-rata allocation of the
available shares on a uniform and nondiscriminatory basis, and the payroll
deductions of each Participant, to the extent in excess of the aggregate
purchase price payable for the Common Stock pro-rated to such individual, shall
be refunded.

            I. ASSIGNABILITY. The purchase right shall be exercisable only by
the Participant and shall not be assignable or transferable by the Participant.

            J. STOCKHOLDER RIGHTS. A Participant shall have no stockholder
rights with respect to the shares subject to his or her outstanding purchase
right until the shares are purchased on the Participant's behalf in accordance
with the provisions of the Plan and the Participant has become a holder of
record of the purchased shares.

      VIII. ACCRUAL LIMITATIONS

            A. No Participant shall be entitled to accrue rights to acquire
Common Stock pursuant to any purchase right outstanding under this Plan if and
to the extent such accrual, when aggregated with (i) rights to purchase Common
Stock accrued under any other purchase right granted under this Plan and (ii)
similar rights accrued under other employee stock purchase plans (within the
meaning of Code Section 423)) of the Corporation or any Corporate Affiliate,
would otherwise permit such Participant to purchase more than Twenty-Five
Thousand Dollars ($25,000.00) worth of stock of the Corporation or any Corporate
Affiliate (determined on the basis of the Fair Market Value per share on the
date or dates such rights are granted) for each calendar year such rights are at
any time outstanding.

            B. For purposes of applying such accrual limitations to the purchase
rights granted under the Plan, the following provisions shall be in effect:

                  (i) The right to acquire Common Stock under each outstanding
      purchase right shall accrue in a series of installments on each successive
      Purchase Date during the offering period on which such right remains
      outstanding.

                  (ii) No right to acquire Common Stock under any outstanding
      purchase right shall accrue to the extent the Participant has already



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      accrued in the same calendar year the right to acquire Common Stock under
      one or more other purchase rights at a rate equal to Twenty-Five Thousand
      Dollars ($25,000.00) worth of Common Stock (determined on the basis of the
      Fair Market Value per share on the date or dates of grant) for each
      calendar year such rights were at any time outstanding.

            C. If by reason of such accrual limitations, any purchase right of a
Participant does not accrue for a particular Purchase Interval, then the payroll
deductions which the Participant made during that Purchase Interval with respect
to such purchase right shall be promptly refunded.

            D. In the event there is any conflict between the provisions of this
Article and one or more provisions of the Plan or any instrument issued
thereunder, the provisions of this Article shall be controlling.

      IX.   EFFECTIVE DATE AND TERM OF THE PLAN

            A. The Plan was adopted by the Board on November 16, 1999 and shall
become effective at the Effective Time, provided no purchase rights granted
under the Plan shall be exercised, and no shares of Common Stock shall be issued
hereunder, until (i) the Plan shall have been approved by the stockholders of
the Corporation and (ii) the Corporation shall have complied with all applicable
requirements of the 1933 Act (including the registration of the shares of Common
Stock issuable under the Plan on a Form S-8 registration statement filed with
the Securities and Exchange Commission), all applicable listing requirements of
any stock exchange (or the Nasdaq National Market, if applicable) on which the
Common Stock is listed for trading and all other applicable requirements
established by law or regulation. In the event such stockholder approval is not
obtained, or such compliance is not effected, within twelve (12) months after
the date on which the Plan is adopted by the Board, the Plan shall terminate and
have no further force or effect, and all sums collected from Participants during
the initial offering period hereunder shall be refunded.

            B. Unless sooner terminated by the Board, the Plan shall terminate
upon the earliest of (i) the last business day in January 2010, (ii) the date on
which all shares available for issuance under the Plan shall have been sold
pursuant to purchase rights exercised under the Plan or (iii) the date on which
all purchase rights are exercised in connection with a Change in Control. No
further purchase rights shall be granted or exercised, and no further payroll
deductions shall be collected, under the Plan following such termination.

      X.    AMENDMENT OF THE PLAN

            A. The Board may alter, amend, suspend or terminate the Plan at any
time to become effective immediately following the close of any Purchase
Interval. However, the Plan may be amended or terminated immediately upon Board
action, if and to the extent necessary to assure that the Corporation will not
recognize, for financial reporting purposes, any compensation expense in
connection with the shares of Common Stock offered for purchase under the Plan,
should the financial accounting rules applicable to the Plan at the Effective
Time



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be subsequently revised so as to require the Corporation to recognize
compensation expense in the absence of such amendment or termination.

            B. In no event may the Board effect any of the following amendments
or revisions to the Plan without the approval of the Corporation's stockholders:
(i) increase the number of shares of Common Stock issuable under the Plan,
except for permissible adjustments in the event of certain changes in the
Corporation's capitalization, (ii) alter the purchase price formula so as to
reduce the purchase price payable for the shares of Common Stock purchasable
under the Plan or (iii) modify the eligibility requirements for participation in
the Plan.

      XI.   GENERAL PROVISIONS

            A. All costs and expenses incurred in the administration of the Plan
shall be paid by the Corporation; however, each Plan Participant shall bear all
costs and expenses incurred by such individual in the sale or other disposition
of any shares purchased under the Plan.

            B. Nothing in the Plan shall confer upon the Participant any right
to continue in the employ of the Corporation or any Corporate Affiliate for any
period of specific duration or interfere with or otherwise restrict in any way
the rights of the Corporation (or any Corporate Affiliate employing such person)
or of the Participant, which rights are hereby expressly reserved by each, to
terminate such person's employment at any time for any reason, with or without
cause.

            C. The provisions of the Plan shall be governed by the laws of the
State of California without resort to that State's conflict-of-laws rules.






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                                   SCHEDULE A

                          CORPORATIONS PARTICIPATING IN

                          EMPLOYEE STOCK PURCHASE PLAN

                            AS OF THE EFFECTIVE TIME

                                  Versata, Inc.


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                                    APPENDIX

            The following definitions shall be in effect under the Plan:

            A. BOARD shall mean the Corporation's Board of Directors.

            B. CASH EARNINGS shall mean the (i) regular base salary paid to a
Participant by one or more Participating Companies on each payroll date during
such individual's period of participation in one or more offering periods under
the Plan plus (ii) all overtime payments, bonuses, commissions, profit-sharing
distributions and other incentive-type payments received on each such date. Such
Cash Earnings shall be calculated before deduction of (A) any income or
employment tax withholdings or (B) any contributions made by the Participant to
any Code Section 401(k) salary deferral plan or Code Section 125 cafeteria
benefit program now or hereafter established by the Corporation or any Corporate
Affiliate. However, Cash Earnings shall NOT include any contributions made on
the Participant's behalf by the Corporation or any Corporate Affiliate to any
employee benefit or welfare plan now or hereafter established (other than Code
Section 401(k) or Code Section 125 contributions deducted from such Cash
Earnings).

            C. CHANGE IN CONTROL shall mean a change in ownership of the
Corporation pursuant to any of the following transactions:

                  (i) a merger or consolidation in which securities possessing
      more than fifty percent (50%) of the total combined voting power of the
      Corporation's outstanding securities are transferred to a person or
      persons different from the persons holding those securities immediately
      prior to such transaction, or

                  (ii) the sale, transfer or other disposition of all or
      substantially all of the assets of the Corporation in complete liquidation
      or dissolution of the Corporation, or

                  (iii) the acquisition, directly or indirectly, by a person or
      related group of persons (other than the Corporation or a person that
      directly or indirectly controls, is controlled by or is under common
      control with the Corporation) of beneficial ownership (within the meaning
      of Rule 13d-3 of the 1934 Act) of securities possessing more than fifty
      percent (50%) of the total combined voting power of the Corporation's
      outstanding securities pursuant to a tender or exchange offer made
      directly to the Corporation's stockholders.

            D. CODE shall mean the Internal Revenue Code of 1986, as amended.

            E. COMMON STOCK shall mean the Corporation's common stock.

            F. CORPORATE AFFILIATE shall mean any parent or subsidiary
corporation of the Corporation (as determined in accordance with Code Section
424), whether now existing or subsequently established.


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            G. CORPORATION shall mean Versata, Inc., a Delaware corporation, and
any corporate successor to all or substantially all of the assets or voting
stock of Versata, Inc. which shall by appropriate action adopt the Plan.

            H. EFFECTIVE TIME shall mean the time at which the Underwriting
Agreement is executed and the Common Stock priced for the initial public
offering of such Common Stock. Any Corporate Affiliate which becomes a
Participating Corporation after such Effective Time shall designate a subsequent
Effective Time with respect to its employee-Participants.

            I. ELIGIBLE EMPLOYEE shall mean any person who is employed by a
Participating Corporation on a basis under which he or she is regularly expected
to render more than twenty (20) hours of service per week for more than five (5)
months per calendar year for earnings considered wages under Code Section
3401(a).

            J. FAIR MARKET VALUE per share of Common Stock on any relevant date
shall be determined in accordance with the following provisions:

                  (i) If the Common Stock is at the time traded on the Nasdaq
      National Market, then the Fair Market Value shall be the closing selling
      price per share of Common Stock on the date in question, as such price is
      reported by the National Association of Securities Dealers on the Nasdaq
      National Market. If there is no closing selling price for the Common Stock
      on the date in question, then the Fair Market Value shall be the closing
      selling price on the last preceding date for which such quotation exists.

                  (ii) If the Common Stock is at the time listed on any Stock
      Exchange, then the Fair Market Value shall be the closing selling price
      per share of Common Stock on the date in question on the Stock Exchange
      determined by the Plan Administrator to be the primary market for the
      Common Stock, as such price is officially quoted in the composite tape of
      transactions on such exchange. If there is no closing selling price for
      the Common Stock on the date in question, then the Fair Market Value shall
      be the closing selling price on the last preceding date for which such
      quotation exists.

                  (iii) For purposes of the initial offering period which begins
      at the Effective Time, the Fair Market Value shall be deemed to be equal
      to the price per share at which the Common Stock is sold in the initial
      public offering pursuant to the Underwriting Agreement.

            K. 1933 ACT shall mean the Securities Act of 1933, as amended.

            L. PARTICIPANT shall mean any Eligible Employee of a Participating
Corporation who is actively participating in the Plan.

            M. PARTICIPATING CORPORATION shall mean the Corporation and such
Corporate Affiliate or Affiliates as may be authorized from time to time by the
Board to extend the benefits of the Plan to their Eligible Employees. The
Participating Corporations in the Plan are listed in attached Schedule A.


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            N. PLAN shall mean the Corporation's Employee Stock Purchase Plan,
as set forth in this document.

            O. PLAN ADMINISTRATOR shall mean the committee of two (2) or more
Board members appointed by the Board to administer the Plan.

            P. PURCHASE DATE shall mean the last business day of each Purchase
Interval. The first Purchase Date shall be July 30, 2000.

            Q. PURCHASE INTERVAL shall mean each successive six (6)-month period
within the offering period at the end of which there shall be purchased shares
of Common Stock on behalf of each Participant.

            R. START DATE shall mean the date on which an offering period begins
and shall be either the first business day in February or August each year
provided, however, that the Start Date of the initial offering period shall be
the Effective Time.

            S. STOCK EXCHANGE shall mean either the American Stock Exchange or
the New York Stock Exchange.

            T. UNDERWRITING AGREEMENT shall mean the agreement between the
Corporation and the underwriter or underwriters managing the initial public
offering of the Common Stock.




                                      A-3.