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                                                                    EXHIBIT 10.4

                                 SELECTICA, INC.

                           1999 EQUITY INCENTIVE PLAN

                            ADOPTED NOVEMBER 18, 1999
                     AMENDED AND RESTATED DECEMBER 11, 2002

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                                TABLE OF CONTENTS

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ARTICLE 1. INTRODUCTION.........................................................................................         1

ARTICLE 2. ADMINISTRATION.......................................................................................         1
     2.1 Committee Composition..................................................................................         1
     2.2 Committee Responsibilities.............................................................................         1
     2.3 Committee for Non-Officer Grants.......................................................................         1

ARTICLE 3. SHARES AVAILABLE FOR GRANTS..........................................................................         2
     3.1 Basic Limitation.......................................................................................         2
     3.2 Annual Increase in Shares..............................................................................         2
     3.3 Additional Shares......................................................................................         2
     3.4 Dividend Equivalents...................................................................................         2

ARTICLE 4. ELIGIBILITY..........................................................................................         2
     4.1 Incentive Stock Options................................................................................         2
     4.2 Other Grants...........................................................................................         3

ARTICLE 5. OPTIONS..............................................................................................         3
     5.1 Stock Option Agreement.................................................................................         3
     5.2 Number of Shares.......................................................................................         3
     5.3 Exercise Price.........................................................................................         3
     5.4 Exercisability and Term................................................................................         3
     5.5 Modification or Assumption of Options..................................................................         3
     5.6 Buyout Provisions......................................................................................         4

ARTICLE 6. PAYMENT FOR OPTION SHARES............................................................................         4
     6.1 General Rule...........................................................................................         4
     6.2 Surrender of Stock.....................................................................................         4
     6.3 Exercise/Sale..........................................................................................         4
     6.4 Exercise/Pledge........................................................................................         4
     6.5 Promissory Note........................................................................................         4
     6.6 Other Forms of Payment.................................................................................         5

ARTICLE 7. AUTOMATIC OPTION GRANTS TO OUTSIDE DIRECTORS.........................................................         5
     7.1 Initial Grants.........................................................................................         5
     7.2 Annual Grants..........................................................................................         5
     7.3 Accelerated Exercisability.............................................................................         5
     7.4 Exercise Price.........................................................................................         5
     7.5 Term...................................................................................................         5
     7.6 Affiliates of Outside Directors........................................................................         5
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ARTICLE 8. STOCK APPRECIATION RIGHTS............................................................................         6
     8.1 SAR Agreement..........................................................................................         6
     8.2 Number of Shares.......................................................................................         6
     8.3 Exercise Price.........................................................................................         6
     8.4 Exercisability and Term................................................................................         6
     8.5 Exercise of SARs.......................................................................................         6
     8.6 Modification or Assumption of SARs.....................................................................         7

ARTICLE 9. RESTRICTED SHARES....................................................................................         7
     9.1 Restricted Stock Agreement.............................................................................         7
     9.2 Payment for Awards.....................................................................................         7
     9.3 Vesting Conditions.....................................................................................         7
     9.4 Voting and Dividend Rights.............................................................................         7

ARTICLE 10. STOCK UNITS.........................................................................................         7
     10.1  Stock Unit Agreement.................................................................................         7
     10.2  Payment for Awards...................................................................................         8
     10.3  Vesting Conditions...................................................................................         8
     10.4  Voting and Dividend Rights...........................................................................         8
     10.5  Form and Time of Settlement of Stock Units...........................................................         8
     10.6  Death of Recipient...................................................................................         8
     10.7  Creditors' Rights....................................................................................         8

ARTICLE 11. PROTECTION AGAINST DILUTION.........................................................................         9
     11.1  Adjustments..........................................................................................         9
     11.2  Dissolution or Liquidation...........................................................................         9
     11.3  Reorganizations......................................................................................         9

ARTICLE 12. CHANGE IN CONTROL...................................................................................        10

ARTICLE 13. DEFERRAL OF AWARDS..................................................................................        10

ARTICLE 14. AWARDS UNDER OTHER PLANS............................................................................        11

ARTICLE 15. PAYMENT OF DIRECTOR'S FEES IN SECURITIES............................................................        11
     15.1  Effective Date.......................................................................................        11
     15.2  Elections to Receive NSOs, Restricted Shares or Stock Units..........................................        11
     15.3  Number and Terms of NSOs, Restricted Shares or Stock Units...........................................        11

ARTICLE 16. LIMITATION ON RIGHTS................................................................................        11
     16.1  Retention Rights.....................................................................................        11
     16.2  Stockholders' Rights.................................................................................        11
     16.3  Regulatory Requirements..............................................................................        12

ARTICLE 17. WITHHOLDING TAXES...................................................................................        12
     17.1  General..............................................................................................        12
     17.2  Share Withholding....................................................................................        12
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ARTICLE 18. FUTURE OF THE PLAN..................................................................................        12
     18.1  Term of the Plan.....................................................................................        12
     18.2  Amendment or Termination.............................................................................        12

ARTICLE 19. LIMITATION ON PAYMENTS..............................................................................        12
     19.1  Scope of Limitation..................................................................................        12
     19.2  Basic Rule...........................................................................................        13
     19.3  Reduction of Payments................................................................................        13
     19.4  Overpayments and Underpayments.......................................................................        13
     19.5  Related Corporations.................................................................................        14

ARTICLE 20. DEFINITIONS.........................................................................................        14
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                                 SELECTICA, INC.

                           1999 EQUITY INCENTIVE PLAN

         ARTICLE 1.INTRODUCTION.

                  The Board adopted the Plan on November 18, 1999, effective as
of March 9, 2000 (the date of the Company's initial public offering). The Board
amended and restated the Plan on December 11, 2002. The purpose of the Plan is
to promote the long-term success of the Company and the creation of stockholder
value by (a) encouraging Employees, Outside Directors and Consultants to focus
on critical long-range objectives, (b) encouraging the attraction and retention
of Employees, Outside Directors and Consultants with exceptional qualifications
and (c) linking Employees, Outside Directors and Consultants directly to
stockholder interests through increased stock ownership. The Plan seeks to
achieve this purpose by providing for Awards in the form of Restricted Shares,
Stock Units, Options (which may constitute incentive stock options or
nonstatutory stock options) or stock appreciation rights.

                  The Plan shall be governed by, and construed in accordance
with, the laws of the State of Delaware (except their choice-of-law provisions).

         ARTICLE 2.ADMINISTRATION.

                  2.1      COMMITTEE COMPOSITION. The Committee shall administer
the Plan. The Committee shall consist exclusively of two or more directors of
the Company, who shall be appointed by the Board. In addition, the composition
of the Committee shall satisfy:

                           (a)      Such requirements as the Securities and
         Exchange Commission may establish for administrators acting under plans
         intended to qualify for exemption under Rule 16b-3 (or its successor)
         under the Exchange Act; and

                           (b)      Such requirements as the Internal Revenue
         Service may establish for outside directors acting under plans intended
         to qualify for exemption under section 162(m)(4)(C) of the Code.

                  2.2      COMMITTEE RESPONSIBILITIES. The Committee shall (a)
select the Employees, Outside Directors and Consultants who are to receive
Awards under the Plan, (b) determine the type, number, vesting requirements and
other features and conditions of such Awards, (c) interpret the Plan and (d)
make all other decisions relating to the operation of the Plan. The Committee
may adopt such rules or guidelines as it deems appropriate to implement the
Plan. The Committee's determinations under the Plan shall be final and binding
on all persons.

                  2.3      COMMITTEE FOR NON-OFFICER GRANTS. The Board may also
appoint a secondary committee of the Board, which shall be composed of one or
more directors of the

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Company who need not satisfy the requirements of Section 2.1. Such secondary
committee may administer the Plan with respect to Employees and Consultants who
are not considered officers or directors of the Company under section 16 of the
Exchange Act, may grant Awards under the Plan to such Employees and Consultants
and may determine all features and conditions of such Awards. Within the
limitations of this Section 2.3, any reference in the Plan to the Committee
shall include such secondary committee.

         ARTICLE 3. SHARES AVAILABLE FOR GRANTS.

                  3.1      BASIC LIMITATION. Common Shares issued pursuant to
the Plan may be authorized but unissued shares or treasury shares. The aggregate
number of Options, SARs, Stock Units and Restricted Shares awarded under the
Plan shall not exceed (a) 2,200,000 plus (b) the additional Common Shares
described in Sections 3.2 and 3.3. The limitations of this Section 3.1 and
Section 3.2 shall be subject to adjustment pursuant to Article 11.

                  3.2      ANNUAL INCREASE IN SHARES. As of January 1 of each
year, commencing with the year 2001, the aggregate number of Options, SARs,
Stock Units and Restricted Shares that may be awarded under the Plan shall
automatically increase by a number equal to the lowest of (a) 5% of the total
number of Common Shares then outstanding, (b) 1,800,000 Common Shares or (c) the
number determined by the Board.

                  3.3      ADDITIONAL SHARES. If Restricted Shares or Common
Shares issued upon the exercise of Options are forfeited, then such Common
Shares shall again become available for Awards under the Plan. If Stock Units,
Options or SARs are forfeited or terminate for any other reason before being
exercised, then the corresponding Common Shares shall again become available for
Awards under the Plan. If Stock Units are settled, then only the number of
Common Shares (if any) actually issued in settlement of such Stock Units shall
reduce the number available under Section 3.1 and the balance shall again become
available for Awards under the Plan. If SARs are exercised, then only the number
of Common Shares (if any) actually issued in settlement of such SARs shall
reduce the number available under Section 3.1 and the balance shall again become
available for Awards under the Plan. The foregoing notwithstanding, the
aggregate number of Common Shares that may be issued under the Plan upon the
exercise of ISOs shall not be increased when Restricted Shares or other Common
Shares are forfeited.

                  3.4      DIVIDEND EQUIVALENTS. Any dividend equivalents paid
or credited under the Plan shall not be applied against the number of Restricted
Shares, Stock Units, Options or SARs available for Awards, whether or not such
dividend equivalents are converted into Stock Units.

         ARTICLE 4. ELIGIBILITY.

                  4.1      INCENTIVE STOCK OPTIONS. Only Employees who are
common-law employees of the Company, a Parent or a Subsidiary shall be eligible
for the grant of ISOs. In addition, an Employee who owns more than 10% of the
total combined voting power of all classes of outstanding stock of the Company
or any of its Parents or Subsidiaries shall not be

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eligible for the grant of an ISO unless the requirements set forth in section
422(c)(6) of the Code are satisfied.

                  4.2      OTHER GRANTS. Only Employees, Outside Directors and
Consultants shall be eligible for the grant of Restricted Shares, Stock Units,
NSOs or SARs.

         ARTICLE 5. OPTIONS.

                  5.1      STOCK OPTION AGREEMENT. Each grant of an Option under
the Plan shall be evidenced by a Stock Option Agreement between the Optionee and
the Company. Such Option shall be subject to all applicable terms of the Plan
and may be subject to any other terms that are not inconsistent with the Plan.
The Stock Option Agreement shall specify whether the Option is an ISO or an NSO.
The provisions of the various Stock Option Agreements entered into under the
Plan need not be identical. Options may be granted in consideration of a
reduction in the Optionee's other compensation. A Stock Option Agreement may
provide that a new Option will be granted automatically to the Optionee when he
or she exercises a prior Option and pays the Exercise Price in the form
described in Section 6.2.

                  5.2      NUMBER OF SHARES. Each Stock Option Agreement shall
specify the number of Common Shares subject to the Option and shall provide for
the adjustment of such number in accordance with Article 11. Options granted to
any Optionee in a single fiscal year of the Company shall not cover more than
330,000 Common Shares, except that Options granted to a new Employee in the
fiscal year of the Company in which his or her Service as an Employee first
commences shall not cover more than 660,000 Common Shares. The limitations set
forth in the preceding sentence shall be subject to adjustment in accordance
with Article 11.

                  5.3      EXERCISE PRICE. Each Stock Option Agreement shall
specify the Exercise Price; provided that the Exercise Price under an ISO shall
in no event be less than 100% of the Fair Market Value of a Common Share on the
date of grant and the Exercise Price under an NSO shall in no event be less than
85% of the Fair Market Value of a Common Share on the date of grant. In the case
of an NSO, a Stock Option Agreement may specify an Exercise Price that varies in
accordance with a predetermined formula while the NSO is outstanding.

                  5.4      EXERCISABILITY AND TERM. Each Stock Option Agreement
shall specify the date or event when all or any installment of the Option is to
become exercisable. The Stock Option Agreement shall also specify the term of
the Option; provided that the term of an ISO shall in no event exceed 10 years
from the date of grant. A Stock Option Agreement may provide for accelerated
exercisability in the event of the Optionee's death, disability or retirement or
other events and may provide for expiration prior to the end of its term in the
event of the termination of the Optionee's Service. Options may be awarded in
combination with SARs, and such an Award may provide that the Options will not
be exercisable unless the related SARs are forfeited.

                  5.5      MODIFICATION OR ASSUMPTION OF OPTIONS. Within the
limitations of the Plan, the Committee may modify, extend or assume outstanding
options or may accept the cancellation of outstanding options (whether granted
by the Company or by another issuer) in return for the grant of new options for
the same or a different number of shares and at the same

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or a different exercise price. The foregoing notwithstanding, no modification of
an Option shall, without the consent of the Optionee, alter or impair his or her
rights or obligations under such Option.

                  5.6      BUYOUT PROVISIONS. The Committee may at any time (a)
offer to buy out for a payment in cash or cash equivalents an Option previously
granted or (b) authorize an Optionee to elect to cash out an Option previously
granted, in either case at such time and based upon such terms and conditions as
the Committee shall establish.

         ARTICLE 6. PAYMENT FOR OPTION SHARES.

                  6.1      GENERAL RULE. The entire Exercise Price of Common
Shares issued upon exercise of Options shall be payable in cash or cash
equivalents at the time when such Common Shares are purchased, except as
follows:

                           (a)      In the case of an ISO granted under the
         Plan, payment shall be made only pursuant to the express provisions of
         the applicable Stock Option Agreement. The Stock Option Agreement may
         specify that payment may be made in any form(s) described in this
         Article 6.

                           (b)      In the case of an NSO, the Committee may at
         any time accept payment in any form(s) described in this Article 6.

                  6.2      SURRENDER OF STOCK. To the extent that this Section
6.2 is applicable, all or any part of the Exercise Price may be paid by
surrendering, or attesting to the ownership of, Common Shares that are already
owned by the Optionee. Such Common Shares shall be valued at their Fair Market
Value on the date when the new Common Shares are purchased under the Plan. The
Optionee shall not surrender, or attest to the ownership of, Common Shares in
payment of the Exercise Price if such action would cause the Company to
recognize compensation expense (or additional compensation expense) with respect
to the Option for financial reporting purposes.

                  6.3      EXERCISE/SALE. To the extent that this Section 6.3 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid by delivering (on a form prescribed by the Company) an irrevocable
direction to a securities broker approved by the Company to sell all or part of
the Common Shares being purchased under the Plan and to deliver all or part of
the sales proceeds to the Company.

                  6.4      EXERCISE/PLEDGE. To the extent that this Section 6.4
is applicable, all or any part of the Exercise Price and any withholding taxes
may be paid by delivering (on a form prescribed by the Company) an irrevocable
direction to pledge all or part of the Common Shares being purchased under the
Plan to a securities broker or lender approved by the Company, as security for a
loan, and to deliver all or part of the loan proceeds to the Company.

                  6.5      PROMISSORY NOTE. To the extent that this Section 6.5
is applicable, all or any part of the Exercise Price and any withholding taxes
may be paid by delivering (on a form prescribed by the Company) a full-recourse
promissory note. However, the par value of the

                                       4

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Common Shares being purchased under the Plan, if newly issued, shall be paid in
cash or cash equivalents.

                  6.6      OTHER FORMS OF PAYMENT. To the extent that this
Section 6.6 is applicable, all or any part of the Exercise Price and any
withholding taxes may be paid in any other form that is consistent with
applicable laws, regulations and rules.

         ARTICLE 7. AUTOMATIC OPTION GRANTS TO OUTSIDE DIRECTORS.

                  7.1      INITIAL GRANTS. Each Outside Director who first
becomes a member of the Board after December 11, 2002, shall receive a one-time
grant of an NSO covering 50,000 Common Shares (subject to adjustment under
Article 11). Such NSO shall be granted on the date when such Outside Director
first joins the Board. Such NSO shall become exercisable with respect to 12,500
Common Shares when the outside Director completes 12 months of continuous
Service after the date of grant and with respect to an additional 1,041.667
Common Shares when the Outside Director completes each of the next 36 months of
continuous Service. An Outside Director who previously was an Employee shall not
receive a grant under this Section 7.1.

                  7.2      ANNUAL GRANTS. Upon the conclusion of each regular
annual meeting of the Company's stockholders held in the year 2003 or
thereafter, each Outside Director who will continue serving as a member of the
Board thereafter shall receive an NSO covering 12,500 Common Shares (subject to
adjustment under Article 11), except that such NSO shall not be granted in the
calendar year in which the same Outside Director received the NSO described in
Section 7.1. NSOs granted under this Section 7.2 shall become exercisable in
full on the first anniversary of the date of grant. An Outside Director who
previously was an Employee shall be eligible to receive grants under this
Section 7.2.

                  7.3      ACCELERATED EXERCISABILITY. All NSOs granted to a
Outside Director under this Article 7 shall also become exercisable in full in
the event that:

                           (a)      Such Outside Director's Service terminates
         because of death, total and permanent disability or retirement at or
         after age 65; or

                           (b)      The Company is subject to a Change in
         Control before such Outside Director's Service terminates.

Acceleration of exercisability may also be required by Section 11.3.

                  7.4      EXERCISE PRICE. The Exercise Price under all NSOs
granted to an Outside Director under this Article 7 shall be equal to 100% of
the Fair Market Value of a Common Share on the date of grant, payable in one of
the forms described in Sections 6.1, 6.2 and 6.3.

                  7.5      TERM. All NSOs granted to an Outside Director under
this Article 7 shall terminate on the earliest of (a) the 10th anniversary of
the date of grant, (b) the date 12 months after the termination of such Outside
Director's Service for any reason.

                  7.6      AFFILIATES OF OUTSIDE DIRECTORS. The Committee may
provide that the NSOs that otherwise would be granted to an Outside Director
under this Article 7 shall instead

                                       5

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be granted to an affiliate of such Outside Director. Such affiliate shall then
be deemed to be an Outside Director for purposes of the Plan, provided that the
Service-related vesting and termination provisions pertaining to the NSOs shall
be applied with regard to the Service of the Outside Director.

         ARTICLE 8. STOCK APPRECIATION RIGHTS.

                  8.1      SAR AGREEMENT. Each grant of an SAR under the Plan
shall be evidenced by an SAR Agreement between the Optionee and the Company.
Such SAR shall be subject to all applicable terms of the Plan and may be subject
to any other terms that are not inconsistent with the Plan. The provisions of
the various SAR Agreements entered into under the Plan need not be identical.
SARs may be granted in consideration of a reduction in the Optionee's other
compensation.

                  8.2      NUMBER OF SHARES. Each SAR Agreement shall specify
the number of Common Shares to which the SAR pertains and shall provide for the
adjustment of such number in accordance with Article 11. SARs granted to any
Optionee in a single fiscal year shall in no event pertain to more than 330,000
Common Shares, except that SARs granted to a new Employee in the fiscal year of
the Company in which his or her Service as an Employee first commences shall not
pertain to more than 660,000 Common Shares. The limitations set forth in the
preceding sentence shall be subject to adjustment in accordance with Article 11.

                  8.3      EXERCISE PRICE. Each SAR Agreement shall specify the
Exercise Price. An SAR Agreement may specify an Exercise Price that varies in
accordance with a predetermined formula while the SAR is outstanding.

                  8.4      EXERCISABILITY AND TERM. Each SAR Agreement shall
specify the date when all or any installment of the SAR is to become
exercisable. The SAR Agreement shall also specify the term of the SAR. An SAR
Agreement may provide for accelerated exercisability in the event of the
Optionee's death, disability or retirement or other events and may provide for
expiration prior to the end of its term in the event of the termination of the
Optionee's Service. SARs may be awarded in combination with Options, and such an
Award may provide that the SARs will not be exercisable unless the related
Options are forfeited. An SAR may be included in an ISO only at the time of
grant but may be included in an NSO at the time of grant or thereafter. An SAR
granted under the Plan may provide that it will be exercisable only in the event
of a Change in Control.

                  8.5      EXERCISE OF SARs. Upon exercise of an SAR, the
Optionee (or any person having the right to exercise the SAR after his or her
death) shall receive from the Company (a) Common Shares, (b) cash or (c) a
combination of Common Shares and cash, as the Committee shall determine. The
amount of cash and/or the Fair Market Value of Common Shares received upon
exercise of SARs shall, in the aggregate, be equal to the amount by which the
Fair Market Value (on the date of surrender) of the Common Shares subject to the
SARs exceeds the Exercise Price. If, on the date when an SAR expires, the
Exercise Price under such SAR is less than the Fair Market Value on such date
but any portion of such SAR has not been exercised or surrendered, then such SAR
shall automatically be deemed to be exercised as of such date with respect to
such portion.

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                  8.6      MODIFICATION OR ASSUMPTION OF SARs. Within the
limitations of the Plan, the Committee may modify, extend or assume outstanding
SARs or may accept the cancellation of outstanding SARs (whether granted by the
Company or by another issuer) in return for the grant of new SARs for the same
or a different number of shares and at the same or a different exercise price.
The foregoing notwithstanding, no modification of an SAR shall, without the
consent of the Optionee, alter or impair his or her rights or obligations under
such SAR.

         ARTICLE 9. RESTRICTED SHARES.

                  9.1      RESTRICTED STOCK AGREEMENT. Each grant of Restricted
Shares under the Plan shall be evidenced by a Restricted Stock Agreement between
the recipient and the Company. Such Restricted Shares shall be subject to all
applicable terms of the Plan and may be subject to any other terms that are not
inconsistent with the Plan. The provisions of the various Restricted Stock
Agreements entered into under the Plan need not be identical.

                  9.2      PAYMENT FOR AWARDS. Subject to the following
sentence, Restricted Shares may be sold or awarded under the Plan for such
consideration as the Committee may determine, including (without limitation)
cash, cash equivalents, full-recourse promissory notes, past services and future
services. To the extent that an Award consists of newly issued Restricted
Shares, the consideration shall consist exclusively of cash, cash equivalents or
past services rendered to the Company (or a Parent or Subsidiary) or, for the
amount in excess of the par value of such newly issued Restricted Shares,
full-recourse promissory notes, as the Committee may determine.

                  9.3      VESTING CONDITIONS. Each Award of Restricted Shares
may or may not be subject to vesting. Vesting shall occur, in full or in
installments, upon satisfaction of the conditions specified in the Restricted
Stock Agreement. A Restricted Stock Agreement may provide for accelerated
vesting in the event of the Participant's death, disability or retirement or
other events.

                  9.4      VOTING AND DIVIDEND RIGHTS. The holders of Restricted
Shares awarded under the Plan shall have the same voting, dividend and other
rights as the Company's other stockholders. A Restricted Stock Agreement,
however, may require that the holders of Restricted Shares invest any cash
dividends received in additional Restricted Shares. Such additional Restricted
Shares shall be subject to the same conditions and restrictions as the Award
with respect to which the dividends were paid.

         ARTICLE 10. STOCK UNITS.

                  10.1     STOCK UNIT AGREEMENT. Each grant of Stock Units under
the Plan shall be evidenced by a Stock Unit Agreement between the recipient and
the Company. Such Stock Units shall be subject to all applicable terms of the
Plan and may be subject to any other terms that are not inconsistent with the
Plan. The provisions of the various Stock Unit Agreements entered into under the
Plan need not be identical. Stock Units may be granted in consideration of a
reduction in the recipient's other compensation.

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                  10.2     PAYMENT FOR AWARDS. To the extent that an Award is
granted in the form of Stock Units, no cash consideration shall be required of
the Award recipients.

                  10.3     VESTING CONDITIONS. Each Award of Stock Units may or
may not be subject to vesting. Vesting shall occur, in full or in installments,
upon satisfaction of the conditions specified in the Stock Unit Agreement. A
Stock Unit Agreement may provide for accelerated vesting in the event of the
Participant's death, disability or retirement or other events.

                  10.4     VOTING AND DIVIDEND RIGHTS. The holders of Stock
Units shall have no voting rights. Prior to settlement or forfeiture, any Stock
Unit awarded under the Plan may, at the Committee's discretion, carry with it a
right to dividend equivalents. Such right entitles the holder to be credited
with an amount equal to all cash dividends paid on one Common Share while the
Stock Unit is outstanding. Dividend equivalents may be converted into additional
Stock Units. Settlement of dividend equivalents may be made in the form of cash,
in the form of Common Shares, or in a combination of both. Prior to
distribution, any dividend equivalents that are not paid shall be subject to the
same conditions and restrictions as the Stock Units to which they attach.

                  10.5     FORM AND TIME OF SETTLEMENT OF STOCK UNITS.
Settlement of vested Stock Units may be made in the form of (a) cash, (b) Common
Shares or (c) any combination of both, as determined by the Committee. The
actual number of Stock Units eligible for settlement may be larger or smaller
than the number included in the original Award, based on predetermined
performance factors. Methods of converting Stock Units into cash may include
(without limitation) a method based on the average Fair Market Value of Common
Shares over a series of trading days. Vested Stock Units may be settled in a
lump sum or in installments. The distribution may occur or commence when all
vesting conditions applicable to the Stock Units have been satisfied or have
lapsed, or it may be deferred to any later date. The amount of a deferred
distribution may be increased by an interest factor or by dividend equivalents.
Until an Award of Stock Units is settled, the number of such Stock Units shall
be subject to adjustment pursuant to Article 11.

                  10.6     DEATH OF RECIPIENT. Any Stock Units Award that
becomes payable after the recipient's death shall be distributed to the
recipient's beneficiary or beneficiaries. Each recipient of a Stock Units Award
under the Plan shall designate one or more beneficiaries for this purpose by
filing the prescribed form with the Company. A beneficiary designation may be
changed by filing the prescribed form with the Company at any time before the
Award recipient's death. If no beneficiary was designated or if no designated
beneficiary survives the Award recipient, then any Stock Units Award that
becomes payable after the recipient's death shall be distributed to the
recipient's estate.

                  10.7     CREDITORS' RIGHTS. A holder of Stock Units shall have
no rights other than those of a general creditor of the Company. Stock Units
represent an unfunded and unsecured obligation of the Company, subject to the
terms and conditions of the applicable Stock Unit Agreement.

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         ARTICLE 11. PROTECTION AGAINST DILUTION.

                  11.1     ADJUSTMENTS. In the event of a subdivision of the
outstanding Common Shares, a declaration of a dividend payable in Common Shares
or a combination or consolidation of the outstanding Common Shares (by
reclassification or otherwise) into a lesser number of Common Shares,
corresponding adjustments shall automatically be made in each of the following:

                           (a)      The number of Options, SARs, Restricted
         Shares and Stock Units available for future Awards under Article 3;

                           (b)      The limitations set forth in Sections 5.2
         and 8.2;

                           (c)      The number of NSOs to be granted to Outside
         Directors under Article 7;

                           (d)      The number of Common Shares covered by each
         outstanding Option and SAR;

                           (e)      The Exercise Price under each outstanding
         Option and SAR; or

                           (f)      The number of Stock Units included in any
         prior Award that has not yet been settled.

In the event of a declaration of an extraordinary dividend payable in a form
other than Common Shares in an amount that has a material effect on the price of
Common Shares, a recapitalization, a spin-off or a similar occurrence, the
Committee shall make such adjustments as it, in its sole discretion, deems
appropriate in one or more of the foregoing. Except as provided in this Article
11, a Participant shall have no rights by reason of any issuance by the Company
of stock of any class or securities convertible into stock of any class, any
subdivision or consolidation of shares of stock of any class, the payment of any
stock dividend or any other increase or decrease in the number of shares of
stock of any class.

                  11.2     DISSOLUTION OR LIQUIDATION. To the extent not
previously exercised or settled, Options, SARs and Stock Units shall terminate
immediately prior to the dissolution or liquidation of the Company.

                  11.3     REORGANIZATIONS. In the event that the Company is a
party to a merger or other reorganization, outstanding Awards shall be subject
to the agreement of merger or reorganization. Such agreement shall provide for
(a) the continuation of the outstanding Awards by the Company, if the Company is
a surviving corporation, (b) the assumption of the outstanding Awards by the
surviving corporation or its parent or subsidiary, (c) the substitution by the
surviving corporation or its parent or subsidiary of its own awards for the
outstanding Awards, (d) full exercisability or vesting and accelerated
expiration of the outstanding Awards or (e) settlement of the full value of the
outstanding Awards in cash or cash equivalents followed by cancellation of such
Awards.

                                       9

<PAGE>

         ARTICLE 12. CHANGE IN CONTROL.

                  Unless the applicable agreement evidencing the Award provides
otherwise, in the event of any Change in Control, the vesting and exercisability
of each outstanding Award shall automatically accelerate so that each such Award
shall, immediately prior to the effective date of the Change in Control, become
fully exercisable for all of the Common Shares at the time subject to such Award
and may be exercised for any or all of those shares as fully vested Common
Shares. However, the vesting and exercisability of an outstanding Award shall
not so accelerate if and to the extent such Award, in connection with the Change
in Control, remains outstanding, or is assumed by the surviving corporation (or
parent or subsidiary thereof) or substituted with an award with substantially
the same terms by the surviving corporation (or parent or subsidiary thereof).
The determination of whether a substituted award has substantially the same
terms as an Award shall be made by the Committee, and its determination shall be
final, binding and conclusive.

                  Unless the applicable agreement evidencing the Award provides
otherwise, in the event of any Change in Control and in the event that a
recipient of an Award experiences an Involuntary Termination within 12 months
following such Change in Control, the vesting and exercisability of each
outstanding Award held by such recipient shall automatically accelerate, as if
the recipient of the Award provided another 12 months of service following such
Involuntary Termination.

         ARTICLE 13. DEFERRAL OF AWARDS.

The Committee (in its sole discretion) may permit or require a Participant to:

                           (a)      Have cash that otherwise would be paid to
         such Participant as a result of the exercise of an SAR or the
         settlement of Stock Units credited to a deferred compensation account
         established for such Participant by the Committee as an entry on the
         Company's books;

                           (b)      Have Common Shares that otherwise would be
         delivered to such Participant as a result of the exercise of an Option
         or SAR converted into an equal number of Stock Units; or

                           (c)      Have Common Shares that otherwise would be
         delivered to such Participant as a result of the exercise of an Option
         or SAR or the settlement of Stock Units converted into amounts credited
         to a deferred compensation account established for such Participant by
         the Committee as an entry on the Company's books. Such amounts shall be
         determined by reference to the Fair Market Value of such Common Shares
         as of the date when they otherwise would have been delivered to such
         Participant.

A deferred compensation account established under this Article 13 may be
credited with interest or other forms of investment return, as determined by the
Committee. A Participant for whom such an account is established shall have no
rights other than those of a general creditor of the Company. Such an account
shall represent an unfunded and unsecured obligation of the Company and shall be
subject to the terms and conditions of the applicable agreement between

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<PAGE>

such Participant and the Company. If the deferral or conversion of Awards is
permitted or required, the Committee (in its sole discretion) may establish
rules, procedures and forms pertaining to such Awards, including (without
limitation) the settlement of deferred compensation accounts established under
this Article 13.

         ARTICLE 14. AWARDS UNDER OTHER PLANS.

The Company may grant awards under other plans or programs. Such awards may be
settled in the form of Common Shares issued under this Plan. Such Common Shares
shall be treated for all purposes under the Plan like Common Shares issued in
settlement of Stock Units and shall, when issued, reduce the number of Common
Shares available under Article 3.

         ARTICLE 15. PAYMENT OF DIRECTOR'S FEES IN SECURITIES.

                  15.1     EFFECTIVE DATE. No provision of this Article 15 shall
be effective unless and until the Board has determined to implement such
provision.

                  15.2     ELECTIONS TO RECEIVE NSOs, RESTRICTED SHARES OR STOCK
UNITS. An Outside Director may elect to receive his or her annual retainer
payments and/or meeting fees from the Company in the form of cash, NSOs,
Restricted Shares or Stock Units, or a combination thereof, as determined by the
Board. Such NSOs, Restricted Shares and Stock Units shall be issued under the
Plan. An election under this Article 15 shall be filed with the Company on the
prescribed form.

                  15.3     NUMBER AND TERMS OF NSOs, RESTRICTED SHARES OR STOCK
UNITS. The number of NSOs, Restricted Shares or Stock Units to be granted to
Outside Directors in lieu of annual retainers and meeting fees that would
otherwise be paid in cash shall be calculated in a manner determined by the
Board. The Board shall also determine the terms of such NSOs, Restricted Shares
or Stock Units.

         ARTICLE 16. LIMITATION ON RIGHTS.

                  16.1     RETENTION RIGHTS. Neither the Plan nor any Award
granted under the Plan shall be deemed to give any individual a right to remain
an Employee, Outside Director or Consultant. The Company and its Parents,
Subsidiaries and Affiliates reserve the right to terminate the Service of any
Employee, Outside Director or Consultant at any time, with or without cause,
subject to applicable laws, the Company's certificate of incorporation and
by-laws and a written employment agreement (if any).

                  16.2     STOCKHOLDERS' RIGHTS. A Participant shall have no
dividend rights, voting rights or other rights as a stockholder with respect to
any Common Shares covered by his or her Award prior to the time when a stock
certificate for such Common Shares is issued or, if applicable, the time when he
or she becomes entitled to receive such Common Shares by filing any required
notice of exercise and paying any required Exercise Price. No adjustment shall
be made for cash dividends or other rights for which the record date is prior to
such time, except as expressly provided in the Plan.

                                       11

<PAGE>

                  16.3     REGULATORY REQUIREMENTS. Any other provision of the
Plan notwithstanding, the obligation of the Company to issue Common Shares under
the Plan shall be subject to all applicable laws, rules and regulations and such
approval by any regulatory body as may be required. The Company reserves the
right to restrict, in whole or in part, the delivery of Common Shares pursuant
to any Award prior to the satisfaction of all legal requirements relating to the
issuance of such Common Shares, to their registration, qualification or listing
or to an exemption from registration, qualification or listing.

         ARTICLE 17. WITHHOLDING TAXES.

                  17.1     GENERAL. To the extent required by applicable
federal, state, local or foreign law, a Participant or his or her successor
shall make arrangements satisfactory to the Company for the satisfaction of any
withholding tax obligations that arise in connection with the Plan. The Company
shall not be required to issue any Common Shares or make any cash payment under
the Plan until such obligations are satisfied.

                  17.2     SHARE WITHHOLDING. To the extent that applicable law
subjects a Participant to tax withholding obligations, the Committee may permit
such Participant to satisfy all or part of such obligations by having the
Company withhold all or a portion of any Common Shares that otherwise would be
issued to him or her or by surrendering all or a portion of any Common Shares
that he or she previously acquired. Such Common Shares shall be valued at their
Fair Market Value on the date when they are withheld or surrendered.

         ARTICLE 18. FUTURE OF THE PLAN.

                  18.1     TERM OF THE PLAN. The amended and restated Plan, as
set forth herein, shall become effective on December 11, 2002. The Plan shall
remain in effect until it is terminated under Section 18.2, except that no ISOs
shall be granted on or after the 10th anniversary of the later of (a) the date
when the Board adopted the original Plan or (b) the date when the Board adopted
the most recent increase in the number of Common Shares available under Article
3 that was approved by the Company's stockholders.

                  18.2     AMENDMENT OR TERMINATION. The Board may, at any time
and for any reason, amend or terminate the Plan. An amendment of the Plan shall
be subject to the approval of the Company's stockholders only to the extent
required by applicable laws, regulations or rules. No Awards shall be granted
under the Plan after the termination thereof. The termination of the Plan, or
any amendment thereof, shall not affect any Award previously granted under the
Plan.

         ARTICLE 19. LIMITATION ON PAYMENTS.

                  19.1     SCOPE OF LIMITATION. This Article 19 shall apply to
an Award only if:

                           (a)      The independent auditors most recently
         selected by the Board (the "Auditors") determine that the after-tax
         value of such Award to the Participant, taking into account the effect
         of all federal, state and local income taxes, employment taxes and
         excise taxes applicable to the Participant (including the excise tax
         under section 4999 of the Code), will be greater after the

                                       12

<PAGE>

         application of this Article 19 than it was before the application of
         this Article 19; or

                           (b)      The Committee, at the time of making an
         Award under the Plan or at any time thereafter, specifies in writing
         that such Award shall be subject to this Article 19 (regardless of the
         after-tax value of such Award to the Participant).

If this Article 19 applies to an Award, it shall supersede any contrary
provision of the Plan or of any Award granted under the Plan.

                  19.2     BASIC RULE. In the event that the Auditors determine
that any payment or transfer by the Company under the Plan to or for the benefit
of a Participant (a "Payment") would be nondeductible by the Company for federal
income tax purposes because of the provisions concerning "excess parachute
payments" in section 280G of the Code, then the aggregate present value of all
Payments shall be reduced (but not below zero) to the Reduced Amount. For
purposes of this Article 19, the "Reduced Amount" shall be the amount, expressed
as a present value, which maximizes the aggregate present value of the Payments
without causing any Payment to be nondeductible by the Company because of
section 280G of the Code.

                  19.3     REDUCTION OF PAYMENTS. If the Auditors determine that
any Payment would be nondeductible by the Company because of section 280G of the
Code, then the Company shall promptly give the Participant notice to that effect
and a copy of the detailed calculation thereof and of the Reduced Amount, and
the Participant may then elect, in his or her sole discretion, which and how
much of the Payments shall be eliminated or reduced (as long as after such
election the aggregate present value of the Payments equals the Reduced Amount)
and shall advise the Company in writing of his or her election within 10 days of
receipt of notice. If no such election is made by the Participant within such
10-day period, then the Company may elect which and how much of the Payments
shall be eliminated or reduced (as long as after such election the aggregate
present value of the Payments equals the Reduced Amount) and shall notify the
Participant promptly of such election. For purposes of this Article 19, present
value shall be determined in accordance with section 280G(d)(4) of the Code. All
determinations made by the Auditors under this Article 19 shall be binding upon
the Company and the Participant and shall be made within 60 days of the date
when a Payment becomes payable or transferable. As promptly as practicable
following such determination and the elections hereunder, the Company shall pay
or transfer to or for the benefit of the Participant such amounts as are then
due to him or her under the Plan and shall promptly pay or transfer to or for
the benefit of the Participant in the future such amounts as become due to him
or her under the Plan.

                  19.4     OVERPAYMENTS AND UNDERPAYMENTS. As a result of
uncertainty in the application of section 280G of the Code at the time of an
initial determination by the Auditors hereunder, it is possible that Payments
will have been made by the Company which should not have been made (an
"Overpayment") or that additional Payments which will not have been made by the
Company could have been made (an "Underpayment"), consistent in each case with
the calculation of the Reduced Amount hereunder. In the event that the Auditors,
based upon the assertion of a deficiency by the Internal Revenue Service against
the Company or the Participant that the Auditors believe has a high probability
of success, determine that an Overpayment has

                                       13

<PAGE>

been made, such Overpayment shall be treated for all purposes as a loan to the
Participant that he or she shall repay to the Company, together with interest at
the applicable federal rate provided in section 7872(f)(2) of the Code;
provided, however, that no amount shall be payable by the Participant to the
Company if and to the extent that such payment would not reduce the amount that
is subject to taxation under section 4999 of the Code. In the event that the
Auditors determine that an Underpayment has occurred, such Underpayment shall
promptly be paid or transferred by the Company to or for the benefit of the
Participant, together with interest at the applicable federal rate provided in
section 7872(f)(2) of the Code.

                  19.5     RELATED CORPORATIONS. For purposes of this Article
19, the term "Company" shall include affiliated corporations to the extent
determined by the Auditors in accordance with section 280G(d)(5) of the Code.

         ARTICLE 20. DEFINITIONS.

                  20.1     "AFFILIATE" means any entity other than a Subsidiary,
if the Company and/or one or more Subsidiaries own not less than 50% of such
entity.

                  20.2     "AWARD" means any award of an Option, an SAR, a
Restricted Share or a Stock Unit under the Plan.

                  20.3     "BOARD" means the Company's Board of Directors, as
constituted from time to time.

                  20.4     "CAUSE" means the commission of any act of fraud,
embezzlement or dishonesty by the recipient of the Award, any unauthorized use
or disclosure by such person of confidential information or trade secrets of the
Company (or any Parent or Subsidiary), or any other intentional misconduct by
such person adversely affecting the business or affairs of the Company (or any
Parent or Subsidiary) in a material manner.

                  20.5     "CHANGE IN CONTROL" means:

                           (a)      The consummation of a merger or
         consolidation of the Company with or into another entity or any other
         corporate reorganization, if persons who were not stockholders of the
         Company immediately prior to such merger, consolidation or other
         reorganization own immediately after such merger, consolidation or
         other reorganization 50% or more of the voting power of the outstanding
         securities of each of (i) the continuing or surviving entity and (ii)
         any direct or indirect parent corporation of such continuing or
         surviving entity;

                           (b)      The sale, transfer or other disposition of
         all or substantially all of the Company's assets;

                           (c)      A change in the composition of the Board, as
         a result of which fewer than 50% of the incumbent directors are
         directors who either:

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<PAGE>

                                    (i)      Had been directors of the Company
                  on the date 24 months prior to the date of such change in the
                  composition of the Board (the "Original Directors"); or

                                    (ii)     Were appointed to the Board, or
                  nominated for election to the Board, with the affirmative
                  votes of at least a majority of the aggregate of (A) the
                  Original Directors who were in office at the time of their
                  appointment or nomination and (B) the directors whose
                  appointment or nomination was previously approved in a manner
                  consistent with this Paragraph (ii); or

                           (d)      Any transaction as a result of which any
         person is the "beneficial owner" (as defined in Rule 13d-3 under the
         Exchange Act), directly or indirectly, of securities of the Company
         representing at least 50% of the total voting power represented by the
         Company's then outstanding voting securities. For purposes of this
         Subsection (d), the term "person" shall have the same meaning as when
         used in sections 13(d) and 14(d) of the Exchange Act but shall exclude
         (i) a trustee or other fiduciary holding securities under an employee
         benefit plan of the Company or of a Parent or Subsidiary and (ii) a
         corporation owned directly or indirectly by the stockholders of the
         Company in substantially the same proportions as their ownership of the
         common stock of the Company.

A transaction shall not constitute a Change in Control if its sole purpose is to
change the state of the Company's incorporation or to create a holding company
that will be owned in substantially the same proportions by the persons who held
the Company's securities immediately before such transaction.

                  20.6     "CODE" means the Internal Revenue Code of 1986, as
amended.

                  20.7     "COMMITTEE" means a committee of the Board, as
described in Article 2.

                  20.8     "COMMON SHARE" means one share of the common stock of
the Company.

                  20.9     "COMPANY" means Selectica, Inc., a Delaware
corporation.

                  20.10    "CONSULTANT" means a consultant or adviser who
provides bona fide services to the Company, a Parent, a Subsidiary or an
Affiliate as an independent contractor. Service as a Consultant shall be
considered employment for all purposes of the Plan, except as provided in
Section 4.1.

                  20.11    "EMPLOYEE" means a common-law employee of the
Company, a Parent, a Subsidiary or an Affiliate.

                  20.12    "EXCHANGE ACT" means the Securities Exchange Act of
1934, as amended.

                  20.13    "EXERCISE PRICE," in the case of an Option, means the
amount for which one Common Share may be purchased upon exercise of such Option,
as specified in the

                                       15

<PAGE>

applicable Stock Option Agreement. "Exercise Price," in the case of an SAR,
means an amount, as specified in the applicable SAR Agreement, which is
subtracted from the Fair Market Value of one Common Share in determining the
amount payable upon exercise of such SAR.

                  20.14    "FAIR MARKET VALUE" means the market price of Common
Shares, determined by the Committee in good faith on such basis as it deems
appropriate. Whenever possible, the determination of Fair Market Value by the
Committee shall be based on the prices reported in The Wall Street Journal. Such
determination shall be conclusive and binding on all persons.

                  20.15    "INVOLUNTARY TERMINATION" means the termination of
the service of the recipient of the Award which occurs by reason of (a) such
recipient's involuntary dismissal or discharge by the Company for reasons other
than Cause or (b) such recipient's voluntary resignation following (i) a change
in his or her position with the Company which materially reduces his or her
level of responsibility, (ii) a reduction in his or her level of base salary or
(iii) a relocation of such recipient's place of employment by more than 35
miles, provided and only if such change, reduction or relocation is effected by
the Company without the recipient's consent.

                  20.16    "ISO" means an incentive stock option described in
section 422(b) of the Code.

                  20.17    "NSO" means a stock option not described in sections
422 or 423 of the Code.

                  20.18    "OPTION" means an ISO or NSO granted under the Plan
and entitling the holder to purchase Common Shares.

                  20.19    "OPTIONEE" means an individual or estate who holds an
Option or SAR.

                  20.20    "OUTSIDE DIRECTOR" means a member of the Board who is
not an Employee. Service as an Outside Director shall be considered employment
for all purposes of the Plan, except as provided in Section 4.1.

                  20.21    "PARENT" means any corporation (other than the
Company) in an unbroken chain of corporations ending with the Company, if each
of the corporations other than the Company owns stock possessing 50% or more of
the total combined voting power of all classes of stock in one of the other
corporations in such chain. A corporation that attains the status of a Parent on
a date after the adoption of the Plan shall be considered a Parent commencing as
of such date.

                  20.22    "PARTICIPANT" means an individual or estate who holds
an Award.

                  20.23    "PLAN" means this Selectica, Inc. 1999 Equity
Incentive Plan, as amended from time to time.

                  20.24    "RESTRICTED SHARE" means a Common Share awarded under
the Plan.

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<PAGE>

                  20.25    "RESTRICTED STOCK AGREEMENT" means the agreement
between the Company and the recipient of a Restricted Share that contains the
terms, conditions and restrictions pertaining to such Restricted Share.

                  20.26    "SAR" means a stock appreciation right granted under
the Plan.

                  20.27    "SAR AGREEMENT" means the agreement between the
Company and an Optionee that contains the terms, conditions and restrictions
pertaining to his or her SAR.

                  20.28    "SERVICE" means service as an Employee, Outside
Director or Consultant.

                  20.29    "STOCK OPTION AGREEMENT" means the agreement between
the Company and an Optionee that contains the terms, conditions and restrictions
pertaining to his or her Option.

                  20.30    "STOCK UNIT" means a bookkeeping entry representing
the equivalent of one Common Share, as awarded under the Plan.

                  20.31    "STOCK UNIT AGREEMENT" means the agreement between
the Company and the recipient of a Stock Unit that contains the terms,
conditions and restrictions pertaining to such Stock Unit.

                  20.32    "SUBSIDIARY" means any corporation (other than the
Company) in an unbroken chain of corporations beginning with the Company, if
each of the corporations other than the last corporation in the unbroken chain
owns stock possessing 50% or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain. A corporation
that attains the status of a Subsidiary on a date after the adoption of the Plan
shall be considered a Subsidiary commencing as of such date.

                                       17