Versant (VSNT)

NOTE 3.  STOCK-BASED COMPENSATION

Stock-based compensation expense recognized in the consolidated statements of income for the three and six months ended April 30, 2009 totaled $237,000 and $470,000, respectively, and the amount of stock-based compensation expense related to the Company’s equity incentive plan (“Equity Incentive Plan”) and directors stock option plan (“Director Plan”) was $216,000 and $464,000, respectively; and related to the Company’s employee stock purchase plan (“ESPP”) was $21,000 and $6,000, respectively.  Stock-based compensation expense recognized in the consolidated statements of income for the three and six months ended April 30, 2008 totaled $208,000 and $400,000, respectively; the amount of stock-based compensation expense related to the Company’s stock option plans was $178,000 and $356,000, respectively; and related to the Company’s ESPP was $30,000 and $44,000, respectively.

NOTE 3.  STOCK-BASED COMPENSATION

Stock-based compensation expense recognized in the consolidated statements of income for the three months ended January 31, 2009 totaled $233,000, and the amount of stock-based compensation expense related to the Company’s stock option plan and employee stock purchase plan was $248,000 and ($15,000), respectively.  The negative amount in the employee stock purchase plan for the three months ended January 31, 2009 was due to an adjustment in Versant’s forfeiture rate. Stock-based compensation expense recognized in the consolidated statements of income for the three months ended January 31, 2008 totaled $192,000, and the amount of stock-based compensation expense related to the Company’s stock option and employee stock purchase plan was $178,000 and $14,000, respectively.

Stock-Based Compensation

        On November 1, 2005, Versant adopted the fair value recognition provisions of SFAS No. 123(R), Share-Based Payment ("SFAS 123(R)") and Securities and Exchange Commission ("SEC") Staff Accounting Bulletin No. 107 ("SAB 107"), using the modified-prospective transition method. (See Note 3 for details).

        Prior to fiscal 2006, Versant accounted for stock issued to employees in accordance with Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees ("APB 25") as

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VERSANT CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

October 31, 2008

NOTE 2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

interpreted by FIN 44, Accounting for Certain Transactions Involving Stock Compensation and complied with the disclosure provisions of SFAS No.123, Accounting for Stock-Based Compensation ("SFAS 123"). Under APB 25, compensation expense was based on the difference, if any, on the date of the grant, between the fair value of the Company's stock and the exercise price of the option. Stock compensation was amortized over the vesting period of the individual awards in a manner consistent with the method described in FASB Interpretation No. 28, Accounting for Stock Appreciation Rights and Other Variable Stock Option Award Plus. In addition, the Company accounted for stock issued to non-employees in accordance with the provisions of SFAS 123. Pursuant to SFAS 123, stock-based compensation is accounted for at the fair value of the equity instruments issued, or at the fair value of the consideration received, whichever is more reliably measurable.

Stock-Based Compensation

        On November 1, 2005, Versant adopted the fair value recognition provisions of SFAS No. 123(R), Share-Based Payment
("SFAS 123(R)") and Securities and Exchange Commission ("SEC") Staff Accounting Bulletin No. 107 ("SAB 107"),
using the modified-prospective transition method. (See Note 3 for details).

        Prior
to fiscal 2006, Versant accounted for stock issued to employees in accordance with Accounting Principles Board Opinion No. 25, Accounting for Stock
Issued to Employees ("APB 25") as

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VERSANT CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

October 31, 2008

NOTE 2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

interpreted
by FIN 44, Accounting for Certain Transactions Involving Stock Compensation and complied with the disclosure provisions of SFAS
No.123, Accounting for Stock-Based Compensation ("SFAS 123"). Under APB 25, compensation expense was based on the difference, if any, on
the date of the grant, between the fair value of the Company's stock and the exercise price of the option. Stock compensation
was amortized over the vesting period of the individual awards in a manner consistent with the method described in FASB Interpretation No. 28, Accounting for Stock
Appreciation Rights and Other Variable Stock Option Award Plus. In addition, the Company accounted for stock issued to non-employees in accordance with the
provisions of SFAS 123. Pursuant to SFAS 123, stock-based compensation is accounted for at the fair value of the equity instruments issued, or at the fair value of the consideration
received, whichever is more reliably measurable.

NOTE 2.                       STOCK-BASED COMPENSATION

Stock-based compensation expense recognized in the consolidated statements of income for the three and nine months ended July 31, 2008 totaled $227,000 and $627,000 respectively; the amount of stock-based compensation expense related to the Company’s equity incentive plan (“Equity Incentive Plan”) and directors stock option plan (“Director Plan”) was $186,000 and $541,000, respectively; and related to the Company’s employee stock purchase plan (“ESPP”) was $41,000 and $86,000, respectively. Stock-based compensation expense recognized in the consolidated statements of income for the three and nine months ended July 31, 2007 totaled $101,000 and $270,000, respectively; the amount of stock-based compensation expense related to the Company’s stock option plans was $72,000 and $196,000, respectively; and related to the Company’s ESPP was $29,000 and $74,000, respectively.

NOTE 2.  STOCK-BASED COMPENSATION

Stock-based compensation expense recognized in the consolidated statements of operations for the three and six months ended April 30, 2008 totaled $208,000 and $400,000 respectively; the amount of stock-based compensation expense related to the Company’s equity incentive plan (“Equity Incentive Plan”) and directors stock option plan (“Director Plan”) was $178,000 and $356,000, respectively; and related to the Company’s employee stock purchase plan (“ESPP”) was $30,000 and $44,000, respectively. Stock-based compensation expense recognized in the consolidated statements of operations for the three and six months ended April 30, 2007 totaled $87,000 and $169,000, respectively; the amount of stock-based compensation expense related to the Company’s stock option plans was $64,000 and $124,000, respectively; and related to the Company’s ESPP was $23,000 and $45,000, respectively.

NOTE 2.  STOCK-BASED COMPENSATION

Stock-based compensation expense recognized in the consolidated statements of operations for the three months ended January 31, 2008 totaled $192,000, and the amount of stock-based compensation expense related to the Company’s stock option and employee stock purchase plan was $178,000 and $14,000, respectively. Stock-based compensation expense recognized in the consolidated statements of operations for the three months ended January 31, 2007 totaled $82,000, and the amount of stock-based compensation expense related to the Company’s stock option and employee stock purchase plan was $60,000 and $22,000, respectively.

Stock-Based Compensation

        On November 1, 2006, Versant adopted the fair value recognition provisions of SFAS No. 123(R), Share-Based Payment ("SFAS 123(R)") and Securities and Exchange Commission ("SEC") Staff Accounting Bulletin No. 107 ("SAB 107"), using the modified-prospective transition method. (See Note 3 for details).

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VERSANT CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

October 31, 2007

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

        Prior to fiscal 2006, Versant accounted for stock issued to employees in accordance with Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees ("APB 25") as interpreted by FIN 44, Accounting for Certain Transactions Involving Stock Compensation and complied with the disclosure provisions of SFAS No.123, Accounting for Stock-Based Compensation ("SFAS 123"). Under APB 25, compensation expense was based on the difference, if any, on the date of the grant, between the fair value of the Company's stock and the exercise price of the option. Stock compensation was amortized over the vesting period of the individual awards in a manner consistent with the method described in FASB Interpretation No. 28, Accounting for Stock Appreciation Rights and Other Variable Stock Option Award Plus. In addition, the Company accounted for stock issued to non-employees in accordance with the provisions of SFAS 123. Pursuant to SFAS 123, stock-based compensation is accounted for at the fair value of the equity instruments issued, or at the fair value of the consideration received, whichever is more reliably measurable.

        Pursuant to SFAS No. 148, Accounting for Stock-Based Compensation-Transition and Disclosure, the Company was required to disclose the pro forma effects of stock-based compensation on net income (loss) and net income (loss) per share as if the company had elected to use the fair value approach to account for its entire employee stock-based compensation plans. The following table illustrates the pro forma effect on net loss and net loss per share as if the Company had applied the fair value recognition provisions in accordance with SFAS 123 to account for its stock-based compensation expenses related to its employee plans in fiscal 2005 (in thousands, except per share data):

Stock-Based Compensation

        On November 1, 2006, Versant adopted the fair value recognition provisions of SFAS No. 123(R), Share-Based
Payment ("SFAS 123(R)") and Securities and Exchange Commission ("SEC") Staff Accounting Bulletin No. 107 ("SAB 107"), using the modified-prospective
transition method. (See Note 3 for details).

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VERSANT CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

October 31, 2007

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

        Prior
to fiscal 2006, Versant accounted for stock issued to employees in accordance with Accounting Principles Board Opinion No. 25, Accounting for Stock
Issued to Employees ("APB 25") as interpreted by FIN 44, Accounting for Certain Transactions Involving Stock
Compensation and complied with the disclosure provisions of SFAS No.123, Accounting for Stock-Based Compensation
("SFAS 123"). Under APB 25, compensation expense was based on the difference, if any, on the date of the grant, between the fair value of the Company's stock and the exercise price of
the option. Stock compensation was amortized over the vesting period of the individual awards in a manner consistent with the method described in FASB Interpretation No. 28, Accounting for Stock Appreciation Rights and
Other Variable Stock Option Award Plus. In addition, the Company accounted for stock issued to
non-employees in accordance with the provisions of SFAS 123. Pursuant to SFAS 123, stock-based compensation is accounted for at the fair value of the equity instruments
issued, or at the fair value of the consideration received, whichever is more reliably measurable.

        Pursuant
to SFAS No. 148, Accounting for Stock-Based Compensation-Transition and Disclosure, the Company was required to disclose
the pro forma effects of stock-based compensation on net income (loss) and net income (loss) per share as if the company had elected to use the fair value approach to account for its entire employee
stock-based compensation plans. The following table illustrates the pro forma effect on net loss and net loss per share as if the Company had applied the fair value recognition provisions in
accordance with SFAS 123 to account for its stock-based compensation expenses related to its employee plans in fiscal 2005 (in thousands, except per share data):

NOTE 2.  STOCK-BASED COMPENSATION

Stock-based compensation expense recognized in the consolidated income statements for the three and nine months ended July 31, 2007 totaled $101,000 and $270,000, respectively. For the three and nine month periods ended July 31, 2007, the amount of stock-based compensation expense related to stock options was $72,000 and $196,000, respectively; and the amount related to the Company’s employee stock purchase plan (“ESPP”) was $29,000 and $74,000, respectively. Stock-based compensation expense recognized in the consolidated income statements for the three and nine months ended July 31, 2006 totaled $59,000 and $180,000, respectively. For the three and nine month periods ended July 31, 2006, the amount of stock-based compensation expense related to stock options was $42,000 and $149,000, respectively; and the amount related to our ESPP was $17,000 and $31,000, respectively.

NOTE 2.   STOCK-BASED COMPENSATION

Stock-based compensation expense recognized in the consolidated income statements for the three and six months ended April 30, 2007, related to stock options was $64,000 and $124,000, respectively; and related to the Company’s employee stock purchase plan (“ESPP”) was $23,000 and $45,000, respectively. Stock-based compensation expense recognized in the consolidated income statements for the three and six months ended April 30, 2006, related to stock options was $58,000 and $108,000, respectively; and related to ESPP was $6,000 and $13,000, respectively.