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EXHIBIT 10.21 Selectica, Inc. 1999 Equity Incentive PlanNotice of Stock Option Grant(Initial Grant to Directors) You have been granted the following option to purchase shares of the Common Stock of
Selectica, Inc. (the Company): Name of Optionee:
    
    «Name»Total Number of Shares:
    
    «TotalShares»Type of Option:
    
    Nonstatutory Stock OptionExercise Price Per Share:
    
    $«PricePerShare»Date of Grant:
    
    «DateGrant»Vesting Schedule:
    
    This option becomes exercisable with respect to the first 25% of the
Shares subject to this option when you complete 12 months of continuous Service (as
defined in the Plan) from the Date of Grant. Thereafter, this option becomes
exercisable with respect to an additional 1/48th of the Shares subject to
this option when you complete each month of Service.Expiration Date:
    
    «ExpDate». This option expires earlier if your Service terminates earlier,
as described in the Stock Option Agreement.
 You and the Company agree that this option is granted under and governed by the terms and
conditions of the 1999 Equity Incentive Plan (the Plan) and the Stock Option Agreement, both of
which are attached to and made a part of this document. You further agree that the Company may deliver by email all documents relating to the Plan or this
option (including, without limitation, prospectuses required by the Securities and Exchange
Commission) and all other documents that the Company is required to deliver to its security holders
(including, without limitation, annual reports and proxy statements). You also agree that the
Company may deliver these documents by posting them on a web site maintained by the Company or by a
third party under contract with the Company. If the Company posts these documents on a web site,
it will notify you by email. Optionee:
    
    
    
    Selectica, Inc.By:Title:




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Selectica, Inc. 1999 Equity Incentive Plan Stock Option Agreement Tax Treatment
    
    This option is intended to be a nonstatutory stock option, as
provided in the Notice of Stock Option Grant, and is not intended
to qualify as an incentive stock option under section 422 of the
Internal Revenue Code.Vesting
    
    This option becomes exercisable in installments, as shown in the
Notice of Stock Option Grant. In addition, this option becomes
exercisable in full in the event that:
    
    The Company is subject to a Change in Control (as defined
in the Plan); or
    
    Your Service terminates because of death, total and
permanent disability, or retirement at or after age 65. For all
purposes under this Agreement, total and permanent disability
means that you are unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death or which has
lasted, or can be expected to last, for a continuous period of not
less than one year.This option will in no event become exercisable for additional
shares after your Service has terminated for any reason.Term
    
    This option expires in any event at the close of business at
Company headquarters on the day before the 10th
anniversary of the Date of Grant, as shown in the Notice of Stock
Option Grant. (It will expire earlier if your Service terminates,
as described below.)Regular Termination
    
    If your Service terminates for any reason except death or total and
permanent disability, then this option will expire at the close of
business at Company headquarters on the date three months after
your termination date. The Company determines when your Service
terminates for this purpose.Death
    
    If you die before your Service terminates, then this option will
expire at the close of business at Company headquarters on the date
12 months after the date of death.Disability
    
    If your Service terminates because of your total and permanent
disability, then this option will expire at the close of business
at Company headquarters on the date 12 months after your
termination date.
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Leaves of Absence
    
    For purposes of this option, your Service does not terminate when
you go on a military leave, a sick leave or another bona fideleave
of absence, if the leave was approved by the Company in writing and
if continued crediting of Service is required by the terms of the
leave or by applicable law. But your Service terminates when the
approved leave ends, unless you immediately return to active work.
If you go on a leave of absence, then the vesting schedule
specified in the Notice of Stock Option Grant may be adjusted in
accordance with the Companys leave of absence policy or the terms
of your leave.Restrictions on
Exercise
    
    The Company will not permit you to exercise this option if the
issuance of shares at that time would violate any law or
regulation.Notice of Exercise
    
    When you wish to exercise this option, you must notify the Company
by filing the proper Notice of Exercise form at the address given
on the form. Your notice must specify how many shares you wish to
purchase. Your notice must also specify how your shares should be
registered. The notice will be effective when the Company receives
it.If someone else wants to exercise this option after your death,
that person must prove to the Companys satisfaction that he or she
is entitled to do so.Form of Payment
    
    When you submit your notice of exercise, you must include payment
of the option exercise price for the shares that you are
purchasing. To the extent permitted by applicable law, payment may
be made in one (or a combination of two or more) of the following
forms:
    
    Your personal check, a cashiers check or a money order.
    
    Certificates for shares of Company stock that you own,
along with any forms needed to effect a transfer of those shares to
the Company. The value of the shares, determined as of the
effective date of the option exercise, will be applied to the
option exercise price. Instead of surrendering shares of Company
stock, you may attest to the ownership of those shares on a form
provided by the Company and have the same number of shares
subtracted from the option shares issued to you. However, you may
not surrender, or attest to the ownership of, shares of Company
stock in payment of the exercise price if your action would cause
the Company to recognize compensation expense (or additional
compensation expense) with respect to this option for financial
reporting purposes.
    
    Irrevocable directions to a securities broker approved by
the Company to sell all or part of your option shares and to
deliver to the Company from the sale proceeds an amount sufficient
to pay the option exercise
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price and any withholding taxes. (The
balance of the sale proceeds, if any, will be delivered to you.)
The directions must be given by signing a special Notice of
Exercise form provided by the Company.Withholding Taxes
and Stock
Withholding
    
    You will not be allowed to exercise this option unless you make
arrangements acceptable to the Company to pay any withholding taxes
that may be due as a result of the option exercise. With the
Companys consent, these arrangements may include withholding
shares of Company stock that otherwise would be issued to you when
you exercise this option. The value of these shares, determined as
of the effective date of the option exercise, will be applied to
the withholding taxes.Restrictions on
Resale
    
    You agree not to sell any option shares at a time when applicable
laws, Company policies or an agreement between the Company and its
underwriters prohibit a sale. This restriction will apply as long
as your Service continues and for such period of time after the
termination of your Service as the Company may specify.Transfer of Option
    
    Prior to your death, only you may exercise this option. You cannot
transfer or assign this option. For instance, you may not sell
this option or use it as security for a loan. If you attempt to do
any of these things, this option will immediately become invalid.
You may, however, dispose of this option in your will or a
beneficiary designation.Regardless of any marital property settlement agreement, the
Company is not obligated to honor a notice of exercise from your
former spouse, nor is the Company obligated to recognize your
former spouses interest in your option in any other way.Retention Rights
    
    Your option or this Agreement does not give you the right to be
retained by the Company or a subsidiary of the Company in any
capacity. The Company and its subsidiaries reserve the right to
terminate your Service at any time, with or without cause, subject
to applicable law and the Companys bylaws.Stockholder Rights
    
    You, or your estate or heirs, have no rights as a stockholder of
the Company until you have exercised this option by giving the
required notice to the Company and paying the exercise price. No
adjustments are made for dividends or other rights if the
applicable record date occurs before you exercise this option,
except as described in the Plan.Adjustments
    
    In the event of a stock split, a stock dividend or a similar change
in Company stock, the number of shares covered by this option and
the exercise price per share may be adjusted pursuant to the Plan.
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Applicable Law
    
    This Agreement will be interpreted and enforced under the laws of
the State of Delaware (without regard to their choice-of-law
provisions).The Plan and Other
Agreements
    
    The text of the Plan is incorporated in this Agreement by reference.This Agreement and the Plan constitute the entire understanding
between you and the Company regarding this option. Any prior
agreements, commitments or negotiations concerning this option are
superseded. This Agreement may be amended only by another written
agreement between the parties.
 By signing the cover sheet of this Agreement, you agree to all of the terms and conditions
described above and in the Plan. 5