UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549


________________





Form 10-K/A


____________





x
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended March 31, 2011


 ̈
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________





Commission file number: 0-29637


____________





SELECTICA, INC.


(Exact Name of Registrant as Specified in Its Charter)


____________


Delaware
77-0432030(State or Other Jurisdiction of

Incorporation or Organization)
(I.R.S. Employer

Identification No.)





1740 Technology Drive Suite 460, San Jose, California 94110-2111


(Address of Principal Executive Offices)





(408) 570-9700


(Registrant’s Telephone Number)





Securities registered under Section 12(b) of the Act:




Title of Each Class

Name of Each Exchange On Which RegisteredCommon Stock, $0.002 par value per share

The Nasdaq Global Market





Securities registered under Section 12(g) of the Act:


None ____________


Indicate by check mark if the registrant is a well-known seasoned issuer, as defined by Rule 405 of the Securities Act. Yes   ̈    No  x





Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes   ̈    No  x





Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No   ̈








Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes   ̈    No   ̈





Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.      ̈





Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.




Large accelerated filer   ̈
Accelerated filer   ̈Non-accelerated filer   ̈ (Do not check if a smaller reporting company)
Smaller reporting company  x





Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes   ̈    No  x





As of September 30, 2010, the last business day of the registrant’s most recently completed second fiscal quarter, the aggregate market value of the registrant’s common stock held by non-affiliates of the registrant, based upon the closing price of $4.87 per share as reported by The Nasdaq Global Market on that date, was $13,737,082.





As of July 19, 2011, the registrant had outstanding 2,856,112 shares of common stock.





2





Explanatory Statement





This Form 10-K/A is being filed as Amendment No. 1 to our Annual Report on Form 10-K for the fiscal year ended March 31, 2011 originally filed on June 29, 2011 (“Original Annual Report”), for the purpose of adding information under Items 10, 11, 12, 13 and 14 of Part III previously intended to be incorporated by reference from the definitive proxy statement to be filed with the SEC pursuant to Regulation 14A for our 2011 annual meeting of stockholders (the “Proxy Statement”).  The Proxy Statement has not been filed as of the date of filing of this amended report on Form 10-K/A. No attempt has been made in this Form 10-K/A to modify or update any other disclosures presented in the Original Annual Report.





3





PART III





Item 10.
Directors, Executive Officers and Corporate Governance.





Directors





The following table sets forth, as of July 29, 2011, the names and certain information concerning our directors:





Name

Age

Position

Director

Since

End of

TermMichael Casey (1)(3)

48

Director

2010

2011J. Michael Gullard (1)(2)

65

Director

2010

2011Michael Brodsky (2)

42

Director

2010

2011Lloyd Sems (2)(3)

40

Director

2008

2011Alan Howe (1)(3)

50

Director and Chairman of the Board

2009

2011




(1)
Member of the Audit Committee(2)
Member of the Compensation Committee(3)
Member of the Nominating/Corporate Governance Committee





Michael J. Casey was elected to the Board on October 7, 2010 and was appointed as a member of the Nominating/Corporate Governance Committee and as Chairperson of the Audit Committee of the Board (the “Audit Committee”) on October 8, 2010.  Since 2006, Mr. Casey has been a partner at TechCFO, a professional services firm that provides financial and strategic consulting services.  Mr. Casey is currently serves as a director of Blue Pillar, Inc. and Swyzzle, LLC, both privately-held companies.  From 2005 to 2006, Mr. Casey served as the chief operating officer and chief financial officer for Reflex Security, Inc., a privately held provider of security virtualization management solutions.  From 2001 to 2005, Mr. Casey served as Chief Financial Officer for MAPICS, Inc., a publicly traded provider of enterprise resource planning software for the discrete manufacturing industries.  Previously, Mr. Casey served as Executive Vice President, Chief Financial and Administrative Officer of iXL Enterprises, Inc., a publicly traded professional services firm, Chief Financial Officer of Manhattan Associates, Inc., a publicly traded provider of supply chain executive solutions, and Chief Financial Officer of IQ Software Corporation, a publicly traded provider of business intelligence software.  Mr. Casey holds a Bachelor of Business Administration degree in Accounting from The University of Georgia.  We believe that Mr. Casey’s financial and operational experience, particularly with respect to the software industry, will be essential to the Board’s business and operational discussions.





J. Michael Gullard was elected to the Board on October 7, 2010 and was appointed as a member of the Audit Committee and as Chairperson of the Compensation Committee of the Board (the Compensation Committee”) on October 8, 2010.  Mr. Gullard has been the General Partner of Cornerstone Management, a venture capital and consulting firm specializing in software and data communications companies since 1984. He currently serves as a director of the publicly-held companies JDA Software, Inc. and Planar Systems, Inc.  Mr. Gullard also serves as a member of the Board of Directors of the following non-reporting companies:  Alliance Semiconductor Corporation, Proxim Inc. and Dyntek, Inc., where he is also Chairman of the Board of Directors.  From 1992 to 2004, he served as Chairman of NetSolve, Incorporated, a publicly-held corporation that provides IT infrastructure management services on an outsourced basis. From 1996 to 2004, Mr. Gullard also served as Chairman of Merant PLC (formerly Micro Focus Group Ltd.), a publicly-held corporation that specializes in change management software tools. Previously, Mr. Gullard held a variety of senior financial and operational management positions at Intel Corporation. Mr. Gullard holds a B.A. degree in Economics from Stanford University, and an M.B.A. from Stanford's Graduate School of Business.  We believe that Mr. Gullard’s prior positions and current advisory roles provide the Board with leadership experience and operational knowhow; in addition his outside board experience helps the Board in its compliance and governance discussions and strategies.





4


Michael Brodskywas elected to the Board on October 7, 2010 and was appointed as a member of the Board’s Compensation Committee on October 8, 2010.  Mr. Brodsky is currently co-CEO of Federated Sports & Gaming, Inc., and was formerly Executive Chairman of Youbet.com, Inc., a public company, from June 2009 to June 2010.  In June 2010, Youbet.com, Inc. completed its sale to Churchill Downs Incorporated, a public company, and Mr. Brodsky was elected to Churchill Downs Board of Directors.  Prior to serving Youbet.com’s Executive Chairman, Mr. Brodsky served as Youbet.com’s President and CEO from April 2008 to June 2009.  Prior to this, in June 2007, Mr. Brodsky served as a Director for Youbet.com and was elected to Chair its Board in February 2008.  Mr. Brodsky managed New World Opportunity Partners, a public investment arm of the Chicago based Pritzker family, where he was the managing partner beginning in 2005.  Mr. Brodsky also served as Chief Financial Officer of The Away Network from 1999 until 2005.  In 2005, when The Away Network was acquired by Orbitz.com and Cendant Corporation, Mr. Brodsky worked as VP, Finance in Cendant’s Travel Distribution Services Division.  Mr. Brodsky holds a B.A. degree in Anthropology from Syracuse University, a J.D. from Northwestern University School of Law and an M.B.A. from Northwestern University JL Kellogg Graduate School of Management.  We believe that Mr. Brodsky’s prior positions and current advisory roles provide the Board with leadership experience and operational knowhow; in addition his outside board experience helps the Board in its compliance and governance discussions and strategies.





Lloyd Sems has served as a director since June 2, 2008.  He has served as a member of the Compensation Committee since July 10, 2008 and as Chairperson of the Nominating/Corporate Governance Committee of the Board (the “Nominating/Corporate Governance Committee”) since May 20, 2009.  Since October 2003, he has served as President of Sems Capital, LLC and of Capital Edge, LLC, both of which he founded.  Previously, Mr. Sems served as Director of Research and Portfolio Manager for Watchpoint Asset Management, and he served on the Board of Directors of EMAK Worldwide, Inc. from February 2010 to April 2010.  Mr. Sems also serves on the Board of Directors of Sport-Haley, Inc. (OTC Pink Sheets: SPOR), which he joined in April 2009, and CYCC Cyclacel, which he joined in May 2011.  Mr. Sems holds a Bachelor of Science degree in Business Administration and Finance from Albright College.  We believe that Mr. Sems’s knowledge of the securities and capital markets, as well as his experience as one of the Company’s larger long term shareholders, is invaluable to our Board’s discussions of the Company’s strategic, capital and liquidity needs.




Alan Howe was elected to the Board on January 12, 2009.  He has served since January 12, 2010 as Co-Chair of our full Board and on October 8, 2010 was elected as sole Chairman of our full Board.  He has served as co-founder and managing partner of Broadband Initiatives, LLC, a boutique corporate advisory and consulting firm, since 2003.  He also has served as a Managing Director with B Riley & Co. LLC in their corporate advisor group under a consulting agreement, since December 2009.  He served as vice president of strategic and wireless business development for Covad Communications, Inc., a national broadband telecommunications company from May 2005 to October 2008.  Prior to that, Mr. Howe was chief financial officer and vice president of corporate development of Teletrac, Inc., and director of corporate development for Sprint PCS.  Mr. Howe is currently a member of the public Board of Directors of Ditech Networks, Inc.  He previously served on the boards of Proxim, Inc., Crossroads, Inc., Alliance Semiconductor Inc., LLC International, Inc., Kitty Hawk, Inc., Dyntek, Inc., which are no longer reporting companies, and on the Board of Altigen Communications, Inc., which is currently a reporting company.  Mr. Howe holds a B.A. in business administration from the University of Illinois and an M.B.A. from the Indiana University Kelley Graduate School of Business.  We believe that Mr. Howe’s prior positions and current advisory roles provide the Board with leadership experience and operational knowhow; in addition his outside board experience helps the Board in its compliance and governance discussions and strategies.





Executive Officers





The following table sets forth, as of July 29, 2011, the names and certain information concerning our executive officers who do not also serve as directors:





Name

Age

PositionJason Stern

41

Chief Executive Officer and PresidentTodd Spartz

46

Chief Financial Officer and Secretary





5


Jason Stern was appointed as Chief Executive Officer on February 7, 2011.  Since January 12, 2010, Mr. Stern has served, and will continue to serve, as the Company’s President, and he served as the Company’s Chief Operating Officer.  Prior to these positions, he was Senior Vice President of Operations of our Contract Management Business since June 10, 2009.  From March 2008 to June 2009, Mr. Stern served as our Vice President of Products and Business Development for Contract Management Solutions and from January 2007 to March 2008 was Vice President of Solutions.  Prior to joining us in November of 2006, Mr. Stern was the Vice President of Product Management for I-many, Inc. from April 2003 to November 2006.  From September 1999 to June 2002, Mr. Stern was employed by Oracle Corporation, an enterprise software company, managing products for CRM, Call Center, and Finance.  Mr. Stern has a B.A. from UCLA and an M.B.A. from the University of Southern California.





Todd A. Spartzwas appointed our Chief Financial Officer and Secretary on September 14, 2009.  Mr. Spartz served as Chief Financial Officer at Nomis Solutions, Inc. from October 2007 to September 2009. He has also served as Vice President and Corporate Controller at Openwave Systems, from December 2005 until October 2007. Prior to that, Mr. Spartz served in various management positions of Metaward from April 2005 to December 2005, and Oblix from October 2003 to March 2005. Mr. Spartz has a BS Commerce from DePaul University and an MBA from Santa Clara University. Mr. Spartz is a licensed CPA in the state of California.





Section 16(a) Beneficial Ownership Reporting Compliance





Section 16(a) of the Exchange Act requires the Company’s directors, executive officers and persons who own more than 10% percent of the Company’s Common Stock (collectively, “Reporting Persons”) to file reports of ownership and changes in ownership of the Company’s Common Stock.  Reporting Persons are required by SEC regulations to furnish the Company with copies of all Section 16(a) reports they file.  Based solely on its review of the copies of the Reporting Persons’ Section 16(a) reports or written representations from certain Reporting Persons, the Company believes that during the fiscal year ended March 31, 2011, all Reporting Persons complied with all applicable filing requirements, with the exception of reports that were filed late for the following persons: Form 4 for Mr. Miller for 19,600 shares of common stock purchased on June 18, 2010, filed on June 23, 2010; Form 4 for Mr. Stern for 2,454 restricted stock units granted on August 16, 2010, filed on August 23, 2010; Form 4 for Mr. Spartz for 2,359 restricted stock units granted on August 16, 2010, filed on August 23, 1010; Form 4 for Mr. Gullard reporting the grant of a stock option to acquire 5,000 shares of common stock granted on November 9, 2010, filed on November 12, 2010; Form 4 for Mr. Sems reporting the purchase of 1,825 shares of common stock on November 18, 2010, filed on November 22, 2010.





Recommendation of Nominees by Stockholder





On June 28, 2009, our Board of Directors adopted Corporate Governance Guidelines that, among other things, specify procedures by which stockholders may submit recommendations of director candidates as follows:





(a)       To recommend a candidate for election to our Board, a stockholder must notify our Nominating/Corporate Governance Committee by writing to our General Counsel.




(b)       The stockholder’s notice shall set forth the following information:





(i)          To the extent reasonably available, information relating to such director candidate that would be required to be disclosed in a proxy statement pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended, in which such individual is a nominee for election to the Board;





(ii)         The director candidate’s written consent to (A) if selected, be named in the Company’s proxy statement and proxy and (B) if elected, to serve on the Board; and





(iii)        Any other information that such stockholder believes is relevant in considering the director candidate.





Code of Ethics





The Board of Directors has adopted a Code of Ethics for Chief Executive Officer and Senior Financial Officers and a Code of Business Conduct applicable to all directors, officers and employees of the Company as required by applicable securities laws, rules of the Securities and Exchange Commission, and the listing standards of The Nasdaq Stock Market.  The Code of Ethics for Chief Executive Officer and Senior Financial Officers and Code of Business Conduct can be found on our website, http://www.selectica.com/Company/CorporateGovernance/tabid/733/Default.aspx.





6





Audit Committee





The Audit Committee reviews, acts on and reports to the Board of Directors with respect to various auditing and accounting matters, including the adequacy of the Company’s financial reporting and disclosure controls and processes, the adequacy of the Company’s internal control policies, the selection of the Company’s independent auditors, the scope of the annual audits, fees to be paid to the Company’s registered independent public accounting firm, the performance of the Company’s registered independent public accounting firm and the accounting practices of the Company.





During the fiscal year ended March 31, 2011, the members of our Audit Committee were as follows:  from April 1, 2010 through October 7, 2010, Messrs. Arnold (Chair), Sems and Howe, and from October 7, 2010 through March 31, 2011, Messrs. Casey (Chair), Howe and Gullard.  Mr. Howe was appointed to the Audit Committee in January 2009.  Messrs. Casey and Gullard were appointed to the Audit Committee in October 2010.  Mr. Casey was appointed Chairperson of the Audit Committee on October 8, 2010.  The Board has determined that Mr. Casey is an audit committee financial expert within the meaning of applicable SEC rules.





The Board amended and restated the Audit Committee’s written charter on June 28, 2009.  A copy of the Audit Committee Charter is available on the Company’s website at http://www.selectica.com/Company/CorporateGovernance/tabid/733/Default.aspx.





Item 11.
Executive Compensation.





Summary





Our compensation committee believes that our compensation philosophy and programs are designed to foster a performance-oriented culture that aligns management’s interests with those of our stockholders.  Our compensation committee also believes that the compensation of our executive officers is both appropriate and responsive to the goal of improving stockholder value.





Fiscal 2011 Summary Compensation Table





The following table sets forth, for the last two fiscal years, the dollar value of all cash and non-cash compensation earned by each person who, for fiscal year 2011, may be considered a “named executive officer” under the rules of the Securities and Exchange Commission (the “Named Executive Officers”).





Name and Principal Position(6)

Year

Salary ($)

Stock

Awards ($)(1)(5)

Option

Awards ($)(1)(5)

Non-Equity Incentive Plan Compensation ($)(2)

All Other

Compensation ($)

Total ($)Jason Stern (3)

2011

262,384

37,063

-

43,750

3,072

346,269President and Chief

2010

201,421

67,500

21,252

42,469

1,150

333,792Executive OfficerTodd Spartz (4)

2011

252,521

59,300

-

61,650

1,623

375,094Chief Financial Officer

2010

120,833

124,000

-

-

1,643

246,476





7




(1)
The amounts in the Stock Awards and Option Awards columns reflect the grant date fair value of stock awards and option awards granted in the fiscal years shown, calculated in accordance with FASB ASC Topic 718. Assumptions used in the calculation of option award amounts are included in Note 9 to the financial statements set forth in our annual report on Form 10-K filed on June 29, 2011 (Commission File No. 000-29637).





(2)
The amounts in this column represent bonus payments based on the achievement of certain Company milestones.





(3)
Mr. Stern was elected President and Chief Operating Officer on January 12, 2010, and became an executive officer at that time, and he was appointed Chief Executive Officer on February 7, 2011. All other compensation for Mr. Stern are for medical, dental, vision and life insurance.





(4)
Mr. Spartz’s employment with us started on September 14, 2009. All other compensation for Mr. Spartz are for life insurance.





(5)
The material terms of the referenced grants are included in the footnotes to the Outstanding Equity Awards table below and incorporated herein by reference.





(6)
The Company does not consider any other Company employees to be “named executive officers” as defined in Item 402(m) of Regulation S-K.





Outstanding Equity Awards at Fiscal Year-End 2011





The following table sets forth information regarding outstanding equity awards as of March 31, 2011, for each of our named executive officers.





Option Awards

Stock AwardsName

Number of

Securities

Underlying

Unexercised

Options―

Exercisable (#)

Number of

Securities

Underlying

Unexercised

Options―

Unexercisable (#)

Equity

Incentive

Plan Awards:

Number of

Securities

Underlying

Unexercised

Unearned

Options (#)

Option

Exercise

Price ($)

Option

Expiration

Date

Number of

Shares or

Units of

Stock That

Have Not

Vested (#)

Market Value

of Shares or

Units of

Stock That

Have Not

Vested ($)


Equity

Incentive

Plan Awards:

Market or

Payout Value

or Unearned

Shares,

Units or

Other Rights

of Stock

That Have

Not Vested ($)(1)Jason Stern (2)

5,000





$
17.00

11/12/20165,743





$
5.20

1/12/202011,250



$
65,250Todd Spartz (3)












16,250



$
94,250





(1)
Computed in accordance with SEC rules as the number of unvested shares or units multiplied by the closing market price of our Common Stock at the end of the 2011 fiscal year, which was $5.80 on March 31, 2011.  The actual value (if any) to be realized by the officer depends on whether the shares vest and on the future performance of our Common Stock.





(2)
Mr. Stern was granted 5,000 shares of non-qualified incentive stock options on November 13, 2006, which had vested in full over the four years from the date of grant. In addition, Mr. Stern was granted 7,500 shares of performance-based non-qualified incentive stock options on January 12, 2010, 5,743 of these shares which vested based on achievement of certain quarterly performance targets through the end of fiscal 2011. Mr. Stern was granted 8,500 restricted stock units on September 9, 2008, half of which vested after one year of continuous service and the balance which vested over the following four quarters of continuous service thereafter. Mr. Stern was also granted 5,000 restricted stock units on September 1, 2009, 1/16 of which has or will vest after each quarter of continuous service from the September 1, 2009 vesting commencement date. Mr. Stern was granted 2,500 restricted stock units on January 12, 2010, one quarter of which will vest after one year of continuous service from January 12, 2010, the vesting commencement date, and 1/16 will vest after each quarter of continuous service thereafter. Mr. Stern was granted 3,750 performance-based restricted stock units on January 12, 2010, of which 2,873 units vested based on achievement of certain quarterly performance targets through the end of fiscal 2011. Mr. Stern was granted 6,250 restricted stock units on May 4, 2010, half of which vested on May 4, 2011 after one year of continuous service from May 4, 2010, the vesting commencement date, and 1/8 will vest after each quarter of continuous service thereafter.





(3)
Mr. Spartz was granted 10,000 restricted stock units on September 14, 2009, one quarter of which vested on September 14, 2010, and 1/16 shall vest after each quarter of continuous service thereafter; provided that 100% of such shares shall be vested upon a change of control of the Company. Additionally, Mr. Spartz was granted 10,000 performance-based restricted stock units on January 12, 2010, 7,659 units of which vested based on achievement of certain quarterly performance targets through the end of  fiscal 2011.  Mr. Spartz was also granted 10,000 restricted stock units on May 4, 2010, half of which vested on May 4, 2011 after one year of continuous service from May 4, 2010, the vesting commencement date, and 1/8 will vest after each quarter of continuous service thereafter.





8





Employment Agreement with President and Chief Executive Officer





Mr. Stern is party to an employment arrangement with the Company under which he currently receives an annual base salary of $250,000.  For fiscal 2011, the Board adopted an incentive bonus program under which Mr. Stern also received $43,750 in aggregate payments  based on the achievement of certain quarterly revenue and cash flow goals for the Company’s 2011 fiscal year.  For fiscal 2012, the Board adopted an employee bonus program under which Mr. Stern is eligible to receive a cash incentive bonus of up to 90% of his base salary,50% of which is based upon achievement of certain annual revenue targets and 50% of which is based upon certain annual cash savings targets for the year, pursuant to which the amount payable under the plan would be payable at a 75% if 90% of the target metrics are met, 100% if 100% of the target metrics are met and 125% if 120% of the target metrics are met.





Mr. Stern has been granted the following equity incentive grants over the course of his employment with the Company: (i) in 2006 he received a grant of 5,000 non-qualified incentive stock options which vested over four years; (ii)  in 2008 he received a grant of 8,500 restricted stock units which vested over two years; (iii) in 2009 he received a grant of 5,000 restricted stock units on September 1, 2009 vesting over four years; (iv) in 2010 he received a grant of (a) 2,500 restricted stock units vesting over four years, with a one-year minimum service requirement, (b) 3,750 restricted stock units, of which 2,873 units vested based upon quarterly performance criteria established by the Board, (c) 6,250 restricted stock units vesting over two years, with a one-year minimum service requirement and (d) an option to purchase 7,500 shares of the Company’s common stock, 5,743 of these shares which vested based upon quarterly performance criteria established by the Board and (v) in 2011 he received a grant of 20,000 restricted stock units vesting over a period of four years.





In addition, the Company and Mr. Stern have entered into a severance agreement which provides for the continuation of Mr. Stern’s base salary and health insurance coverage for four months if he is discharged for a reason other than cause or permanent disability at any time. However, Mr. Stern is entitled to six months of base salary and health insurance coverage if he is discharged for a reason other than cause or permanent disability or if he resigns for good reason, in either case within 12 months after the Company is subject to a change in control. Mr. Stern will be required to execute a release in the form attached to the severance agreement as a condition of receiving these benefits. The severance agreement also provides that all equity awards held by Mr. Stern at the time of a change in control will immediately vest in full.





Employment Agreement with Chief Financial Officer





Mr. Spartz entered into an employment arrangement with the Company under which he receives an annual base salary of $220,000.  For fiscal 2011, the Board adopted an incentive bonus program under which Mr. Spartz also received $61,651 in aggregate payments  based on the achievement of certain quarterly revenue and cash flow goals for the Company’s 2011 fiscal year.  For fiscal 2012, the Board adopted an employee bonus program under which Mr. Spartz is eligible to receive a cash incentive bonus of up to 60% of his base salary,50% of which is based upon achievement of certain annual revenue targets and 50% of which is based upon certain annual cash savings targets for the year, pursuant to which the amount payable under the plan would be payable at a 75% if 90% of the target metrics are met, 100% if 100% of the target metrics are met and 125% if 120% of the target metrics are met.





Mr. Spartz has been granted the following equity incentive grants over the course of his employment with the Company: (i) in 2009 he received a grant of 10,000 restricted stock units which vest over four years; provided that 100% of such shares shall be vested upon a change of control of the Company; (ii) in 2010 he received a grant of (a) 10,000 restricted stock units, 7,659 of which vested based upon quarterly performance criteria established by the Board and (b) 10,000 restricted stock units vesting over two years, with a one-year minimum service requirement and (iii) in 2011 he received a grant of 15,000 restricted stock units vesting over a period of four years.





In addition, the Company and Mr. Spartz entered into a severance agreement, which provides, among other things, for the continuation of Mr. Spartz’s base salary and health insurance benefits for three months if he is discharged for a reason other than cause or permanent disability at any time. Mr. Spartz will be entitled to six months of base salary and health insurance benefits if he is discharged without cause or resigns for good cause within 12 months after the Company is subject to a change in control. Mr. Spartz will be required to execute a release in the form attached to the severance agreement as a condition of receiving these benefits.





9





Fiscal 2011 Director Compensation





The following table sets forth the compensation of the members of our Board of Directors for fiscal year 2011.





Fees Earnedor Paid in

Stock

OptionName

Cash ($)

Awards ($)(1)

Awards ($)(1)

Total ($)Michael Casey

27,500

25,000

25,900

78,400J. Michael Gullard

22,500

25,000

25,900

73,400Alan Howe

45,000

25,000

-

70,000Lloyd Sems

45,000

25,000

-

70,000Michael Brodsky

22,500

25,000

25,900

73,400Brenda Zawatski

22,500

-

-

22,500Jamie Arnold

27,500

-

-

27,500James Thanos

22,500

-

-

22,500





(1)
The amounts in the Stock Awards and Option Awards columns reflect the grant date fair value of stock awards and option awards granted in the fiscal year 2011, calculated in accordance with FASB ASC Topic 718. Assumptions used in the calculation of option award amounts are included in Note 9 to the financial statements set forth in our annual report on Form 10-K filed on June 29, 2011 (Commission File No. 000-29637).  Our directors held the following stock awards at March 31, 2011: Alan Howe, 10,103 shares; Lloyd Sems, 66,055 shares; J. Michael Gullard, 5,103 shares; Michael Casey, 5,103 shares; Michael Brodsky, 5,103 shares.  Our directors held the following options at March 31, 2011: Michael Brodsky, 5,000 shares; Michael Casey, 5,000 shares; J. Michael Gullard, 5,000 shares; Alan Howe, 5,000 shares; and Lloyd Sems, 5,000 shares.





Under the director compensation policy in effect during fiscal year 2011, each non-employee director was paid a $45,000 annual retainer fee, and the audit committee chair was paid an additional $10,000 annual fee.   Travel expenses incidental to meeting attendance are reimbursed.





In addition, each non-employee director receives restricted stock units with a market value of $25,000 per year.  All of the restricted stock units vest on the first anniversary of the grant, with immediate full vesting in the event of a change in control.  Upon taking office and every three years thereafter, each non-employee director also receives an option to purchase 5,000 shares.  The options vest over three years, with immediate full vesting in the event of a change in control.





Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.





Stock Ownership of Certain Beneficial Owners and Management





The following table sets forth, as of July 29, 2011, certain information with respect to shares beneficially owned by (i) each person who is known by the Company to be the beneficial owner of more than five percent 5% of the Company’s outstanding shares of Common Stock, (ii) each of the Company’s directors and the executive officers named in the Summary Compensation Table and (iii) all current directors and executive officers as a group.  Beneficial ownership has been determined in accordance with Rule 13d-3 under the Securities Exchange Act.  Under this rule, certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares).  In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire shares (for example, upon exercise of an option or warrant) within sixty (60) days of the date as of which the information is provided; in computing the percentage ownership of any person, the amount of shares is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of such acquisition rights.  As a result, the percentage of outstanding shares of any person as shown in the following table does not necessarily reflect the person’s actual voting power at any particular date.  The Company has relied upon the contents of statements filed with the Securities and Exchange Commission pursuant to Section 13(d) of the Securities Exchange Act.  The Company has updated, as appropriate, reported share ownership figures of beneficial owners to reflect a 1-for-20 reverse stock split of the Company’s Common Stock effected on February 24, 2010.





To the Company’s knowledge, except as indicated in the footnotes to this table and pursuant to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all shares of Common Stock as beneficially owned by them.





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Security Ownership of Certain Beneficial Owners





Title of Class

Name and Address of Beneficial Owner

Amount and Nature of Beneficial Ownership

Percent of ClassCommon

Steel Partner Holdings L.P. (1)

590 Madison Avenue, 32nd Floor New York, NY 10022

420,768

14.73%Common

Dimensional Fund Advisors, LP (2)

Palisades West, Building One, 6300 Bee Cave Road, Austin, TX 78746

141,651

4.96%Common

The PNC Financial Services Group, Inc. (3)

One PNC Plaza, 249 Fifth Avenue, Pittsburgh, PA 15222

206,439

7.23%Common

Lloyd I. Miller III (4)

4550 Gordon Drive Naples, FL, 34102

547,619

19.17%





Note: Percentage of ownership is based on 2,856,112 shares of Common Stock outstanding on July 19, 2011.





(1)
Steel Partners Holdings L.P. owns 99% of the membership interests of SPH Group LLC.  SPH Group LLC is the sole member of SPH Group Holdings LLC.  Steel Partners LLC is the manager of Steel Partners Holdings L.P. and has been delegated the sole power to vote and dispose of the securities held by SPH Group Holdings LLC.  Warren G. Lichtenstein is the manager of Steel Partners LLC.  By virtue of these relationships, each of Steel Partners Holdings L.P., SPH Group LLC, Steel Partners LLC, and Mr. Lichtenstein may be deemed to beneficially own the Shares owned directly by SPH Group Holdings LLC.





(2)
Dimensional Fund Advisors LP, an investment adviser registered under Section 203 of the Investment Advisors Act of 1940, furnishes investment advice to four investment companies registered under the Investment Company Act of 1940, and serves as investment manager to certain other commingled group trusts and separate accounts (such investment companies, trusts and accounts, collectively referred to as the “Funds”).  In certain cases, subsidiaries of Dimensional Fund Advisors LP may act as an adviser or sub-adviser to certain Funds.  In its role as investment advisor, sub-adviser and/or manager, neither Dimensional Fund Advisors LP or its subsidiaries (collectively, “Dimensional”) possess voting and/or investment power over the securities of the Issuer that are owned by the Funds, and may be deemed to be the beneficial owner of the shares of the Issuer held by the Funds.  However, all securities reported in this schedule are owned by the Funds.  Dimensional disclaims beneficial ownership of such securities.





(3)
The total shares of Common Stock reported herein are held in trust accounts created by an Amended and Restated Trust Agreement dated September 20, 1983, in which Lloyd I. Miller, Jr. was Grantor and for which PNC Bank, National Association serves as Trustee.  In connection with the trust accounts, Lloyd I. Miller, III and PNC Bank, National Association, in its capacity as Trustee, have entered into an Investment Advisory Agreement dated as of April 1, 2002.  Either party may terminate the Investment Advisory Agreement on 30 days prior written notice.  PNC Bancorp, Inc. is a wholly owned subsidiary of The PNC Financial Services Group, Inc.  PNC Bank, National Association is a wholly owned subsidiary of PNC Bancorp, Inc.





(4)
Mr. Miller has sole voting and dispositive power with respect to 341,180 of the reported securities as a manager of a limited liability company that is the general partner of a certain limited partnership.  Mr. Miller has shared voting and dispositive power with respect to 206,439 of the reported securities as an investment advisor to the trustee of certain family trusts.





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Security Ownership of Management





Title of Class

Name of Beneficial Owner

Amount and Nature of Beneficial Ownership

Percent of ClassCommon

Alan Howe (1)

3,333

*Common

Lloyd Sems (2)

120,860

4.23%Common

Jason Stern (3)

26,724

*Common

Todd Spartz (4)

18,377

*Common

All executive officers and directors as a group (7 persons)

169,294

5.93%


_______________


*
Less than 1% of the outstanding shares of Common Stock.





Note: The number of shares of Common Stock deemed outstanding includes shares issuable pursuant to stock options that may be exercised within 60 days after July 29, 2011. Percentage of ownership is based on 2,856,112 shares of Common Stock outstanding on July 19, 2011, plus shares of Common Stock subject to options or exercisable within 60 days of July 29, 2011, and held by each listed person.  Shares of Common Stock subject to options exercisable within 60 days of July 29, 2011, are deemed outstanding for purposes of computing the percentage ownership of the person holding such options but are not deemed outstanding for computing the percentage ownership of any other person. The Company has updated, as appropriate, reported share ownership figures of management to reflect a 1-for-20 reverse stock split of the Company’s Common Stock effected on February 24, 2010.





(1)
Includes 3,333 shares of Common Stock issuable upon exercise of stock options exercisable within 60 days of July 29, 2011.





(2)
Includes 53,719 shares of Common Stock held by Mr. Sems, 5,000 shares of Common Stock issuable upon the exercise of stock options exercisable within 60 days of July 29, 2011 and 62,141 shares of Common Stock held beneficially by Sems Strategic Partners, LP and Sems Diversified Value, LP, of which Mr. Sems is the managing member of the general partner.





(3)
Includes 22,212 shares of Common Stock held by Mr. Stern and 4,512 shares of Common Stock issuable upon exercise of stock options exercisable within 60 days of July 29, 2011.





(4)
Includes 18,377 shares of Common Stock held by Mr. Spartz.





Securities Authorized for Issuance Under Equity Compensation Plans





The following table sets forth information as of March 31, 2011 with respect to shares of common stock that may be issued under our existing equity compensation plans.





Plan Category

(a)

Number of Securities

to be Issued Upon

Exercise of

Outstanding Options,

Warrants and Rights


(b)

Weighted-Average

Exercise Price of

Outstanding

Options,

Warrants and Rights(1)


(c)

Number of Securities

Remaining Available for

Future Issuance Under

Equity Compensation

Plans (Excluding Securities

Reflected in Column (a))(in thousands, except per share amounts)Equity compensation plans approved by security holders

159
(2)


$
10.03


1,253
(3)Equity compensation plans not approved by security holders

3




39.73


182Total

162



$
10.52


1,435


_________________


(1)
The weighted average exercise price is calculated basely solely on outstanding options.





(2)
Includes options and rights to acquire shares outstanding under our 1996 Stock Plan and 1999 Equity Incentive Plan.





(3)
Represents 815,000 shares available for issuance under our 1996 Stock Plan and 1,551,000 shares available for issuance under our 1999 Equity Incentive Plan.





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Item 13.
Certain Relationships and Related Transactions, and Director Independence





Transactions with Related Persons





Other than the compensation arrangements with directors and executive officers and except as set forth below, there have been no transactions since April 1, 2010 (and there are no currently proposed transactions) in which:





●
We have been or are to be a participant;





●
The amount involved exceeds $120,000; and





●
Any of our directors, executive officers or holders of more than 5% of our capital stock, or any immediately family member of or person sharing the household with any of these individuals (other than tenants or employees), had or will have a direct or indirect material interest.





On May 6, 2010, Brenda Zawatski, one of our former directors, entered into an employment relationship with CA, Inc. (“CA”) as a Senior Vice President working primarily on marketing. During fiscal 2011, CA purchased approximately $0.5 million in software licenses, annual maintenance and related technical services from the Company. Ms. Zawatski had no direct involvement in these transactions as she was not employed by CA at the time. Since May 6, 2010, Ms. Zawatski has not participated in any Board discussions about any ongoing or potential transactions with CA.





Indemnification Agreements





The Company’s certificate of incorporation limits the liability of the Company’s directors for monetary damages arising from a breach of their fiduciary duty as directors, except to the extent otherwise required by the Delaware General Corporation Law. Such limitation of liability does not affect the availability of equitable remedies such as injunctive relief or rescission.





The Company’s bylaws provide that the Company shall indemnify its directors and officers to the fullest extent permitted by Delaware law, including in circumstances in which indemnification is otherwise discretionary under Delaware law. The Company has entered into indemnification agreements with its executive officers and directors containing provisions that may require the Company, among other things, to indemnify such officers and directors against certain liabilities that may arise by reason of their status or service as directors or officers and to advance their expenses incurred as a result of any proceeding against them as to which they could be indemnified. Pursuant to these agreements, the Company has advanced or indemnified certain directors and officers for fees and expenses incurred by them in connection with the ongoing litigation with Trilogy, as previously reported in our Original Annual Report.





Review, Approval or Ratification of Transaction with Related Persons





Our board of directors adopted certain written policies and procedures with respect to related person transactions on June 28, 2009.  These policies and procedures require that certain transactions, subject to specified exceptions and other than one that involves compensation, between us and any of our directors, executive officers or beneficial holders of more than 5% of our capital stock, or any immediate family member of, or person sharing the household with, any of these individuals, be consummated only if (i) approved or ratified by our Audit Committee and only if the terms of the transaction are comparable to those that could be obtained in arm’s-length dealings with an unrelated third party or (ii) approved by the disinterested members of our board of directors.  Our policies and procedures with respect to related person transactions also apply to certain charitable contributions by us or our executive officers and to the hiring of any members of the immediate family of any of our directors or executive officers as our permanent full-time employees.  Our Compensation Committee is also required to approve any transaction that involves compensation to our directors and executive officers.





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Independence of the Board of Directors





The Board of Directors is currently composed of five members.  Messrs. Sems, Gullard, Casey, Brodsky and Howe qualify as independent directors in accordance with the published listing requirements of The Nasdaq Stock Market.  The directors hold office until their successors have been elected and qualified or their earlier death, resignation or removal.





Item 14.
Principal Accounting Fees and Services





The Audit Committee of our Board of Directors selected Armanino McKenna LLP as our independent registered public accounting firm for the fiscal year ended March 31, 2011.





The following table sets forth the aggregate fees we paid to Armanino McKenna LLP, our independent registered public accounting firm, for professional services provided during our fiscal years ended March 31, 2010 and March 31, 2011.





Fiscal 2011


Fiscal 2010(In thousands $)Audit fees(1)


203




376Audit-related fees(2)


0




0Tax fees(3)


0




15All other fees


0




13Total fees


203




404





(1)
Audit fees consist of fees incurred for professional services rendered for the audit of our annual consolidated financial statements and review of the quarterly consolidated financial statements that are normally provided by Armanino McKenna LLP in connection with regulatory filings or engagements.





(2)
Audit-related fees relate to assurance and related services that are reasonably related to the audit or review of our financial statements.





(3)
Tax fees consist of fees for tax planning and tax compliance services.





The Audit Committee’s policy is to pre-approve all audit and permissible non-audit services rendered by Armanino McKenna LLP, our independent registered public accounting firm.  The Audit Committee can pre-approve specified services in defined categories of audit services, audit-related services and tax services up to specified amounts, as part of the Audit Committee’s approval of the scope of the engagement of Armanino McKenna LLP or on an individual case-by-case basis before Armanino McKenna LLP is engaged to provide a service.  All audit, audit-related and tax services were pre-approved by the Audit Committee.  The Audit Committee has determined that, subject to reasonable limits, the rendering of the services other than audit services by Armanino McKenna LLP is compatible with maintaining the principal accountant’s independence.





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SIGNATURES





Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of San Jose, State of California, on the day of July 29, 2011.





SELECTICA, INC.Registrant/s/ Jason SternJason SternChief Executive Officer and President/s/ Todd SpartzTodd SpartzChief Financial Officer





Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.





Signature

Title

Date/s/ Jason Stern

President and Chief Executive Officer (Principal Executive Officer)

July 29, 2011Jason Stern/s/ Todd Spartz

Chief Financial Officer (Principal Financial Officer and

July 29, 2011Todd Spartz

Principal Accounting Officer) and SecretaryDirectors:*

Director

July 29, 2011Michael Casey*

Director

July 29, 2011J. Michael Gullard*

Director

July 29, 2011Lloyd Sems*

Director

July 29, 2011Michael Brodsky*

Director

July 29, 2011Alan Howe





*By the signatures set forth below, the undersigned, pursuant to the duly authorized power of attorney filed with the Securities and Exchange Commission have signed this Amendment No. 1 on Form 10-K/A on behalf of the person indicated.





/s/ Jason SternJason Stern(Attorney-in-fact)/s/ Todd SpartzTodd Spartz(Attorney-in-fact)





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EXHIBIT INDEX




Exhibit No.

Description31.1**

Certification of President and Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2**

Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1**

Certification of President and Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2**

Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.


_________________


**
This certification is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act, or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that Selectica, Inc. specifically incorporates it by reference.