10-Q

United States

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

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

For the quarterly period ended January 31, 2012

OR

o 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 000-28540

VERSANT CORPORATION

(Exact name of Registrant as specified in its charter)

California	94-3079392
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

255 Shoreline Drive, Suite 450, Redwood City, California 94065

(Address of principal executive offices) (Zip code)

(650) 232-2400

(Registrant’s telephone number, including area code)

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 ý   Noo

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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý   No o

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 the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

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

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

As of March 14, 2012, there were outstanding2,862,587 shares of the Registrant’s common stock, no par value.

VERSANT CORPORATION

QUARTERLY REPORT ON FORM 10-Q

For the Quarterly Period Ended January 31, 2012

 Table of Contents

PART I. FINANCIAL INFORMATION	3
Item 1. Financial Statements (Unaudited)	3
Condensed Consolidated Balance Sheets at January 31, 2012 and October 31, 2011	3
Condensed Consolidated Statements of Income for the three months ended January 31, 2012 and 2011	4
Condensed Consolidated Statements of Cash Flows for the three months ended January 31, 2012 and 2011	5
Notes to Condensed Consolidated Financial Statements	6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3. Quantitative and Qualitative Disclosures About Market Risk	28
Item 4. Controls and Procedures	28
PART II. OTHER INFORMATION	29
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	29
Item 5. Other Information	29
Item 6. Exhibits	30
Signatures	31
Certifications

2

PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

VERSANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except for share amounts)

(unaudited)

	January 31, 2012			October 31, 2011
ASSETS
Current assets:
Cash and cash equivalents	$	23,017		$	23,145
Trade accounts receivable, net	3,974			2,183
Deferred income taxes	834			898
Other current assets	392			481
Total current assets	28,217			26,707
Property and equipment, net	923			993
Goodwill	8,589			8,589
Intangible assets, net	283			309
Other assets	38			38
Total assets	$	38,050		$	36,636
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	239		$	152
Accrued liabilities	1,489			1,076
Deferred revenues	3,670			2,695
Total current liabilities	5,398			3,923
Other long-term liabilities	151			178
Total liabilities	5,549			4,101
Commitments and contingencies
Shareholders’ equity:
Common stock, no par value, 7,500,000 shares authorized, 2,926,474 shares issued and outstanding at January 31, 2012, and 2,935,125 shares issued and outstanding at October 31, 2011	90,152			90,055
Accumulated other comprehensive income (loss), net	(233		)	31
Accumulated deficit	(57,418		)	(57,551		)
Total shareholders’ equity	32,501			32,535
Total liabilities and shareholders’ equity	$	38,050		$	36,636

See accompanying notes to condensed consolidated financial statements

3

VERSANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except for per share amounts)

(unaudited)

	Three Months Ended
	January 31,		January 31,
	2012		2011
Revenues:
License	$	2,654	$	2,596
Maintenance	1,653		1,919
Professional services	36		62
Total revenues	4,343		4,577
Cost of revenues:
License	69		68
Amortization of intangible assets	26		73
Maintenance	354		373
Professional services	20		21
Total cost of revenues	469		535
Gross profit	3,874		4,042
Operating expenses:
Sales and marketing	1,453		1,500
Research and development	1,119		932
General and administrative	1,010		1,045
Total operating expenses	3,582		3,477
Income from operations	292		565
Interest and other income, net	27		9
Income before provision for income taxes	319		574
Provision for income taxes	186		113
Net income	$	133	$	461
Net income per share:
Basic	$	0.05	$	0.14
Diluted	$	0.05	$	0.14
Shares used in per share calculation:
Basic	2,935		3,203
Diluted	2,946		3,320

See accompanying notes to condensed consolidated financial statements

4

VERSANT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

	Three Months Ended
	January 31,			January 31,
	2012			2011
Cash flows from operating activities:
Net income	$	133		$	461
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	113			75
Amortization of intangible assets	26			73
Share based compensation	235			224
Changes in assets and liabilities:
Trade accounts receivable, net	(1,845		)	(784		)
Other assets	68			(16		)
Accounts payable	90			206
Accrued liabilities and other long-term liabilities	396			111
Deferred revenues	1,027			631
Net cash provided by operating activities	243			981
Cash flows from investing activities:
Purchases of property and equipment	(86		)	(215		)
Net cash used in investing activities	(86		)	(215		)
Cash flows from financing activities:
Proceeds from issuance of common stock	81			72
Repurchases of common stock	(175		)	(404		)
Net cash used in financing activities	(94		)	(332		)
Effect of foreign exchange rate changes on cash and cash equivalents	(191		)	(49		)
Net increase (decrease) in cash and cash equivalents	(128		)	385
Cash and cash equivalents at beginning of period	23,145			24,911
Cash and cash equivalents at end of period	$	23,017		$	25,296
Supplemental disclosures of cash flows information:
Cash paid (received) for:
Income taxes	$	(85	)	$	105

See accompanying notes to condensed consolidated financial statements

5

VERSANT CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Note 1. Basis of Presentation and Recent Accounting Pronouncements

Basis of Presentation

Versant Corporation (with its subsidiaries, collectively referred to in this report as “Versant” or “the Company”) was incorporated in California in August 1988. The unaudited condensed consolidated financial statements contained in this report on Form 10-Q include all of the assets, liabilities, revenues, expenses and cash flows of Versant and all entities in which Versant has a controlling interest (subsidiaries) required to be consolidated in accordance with U.S. generally accepted accounting principles. Inter-company accounts and transactions between consolidated companies have been eliminated in consolidation.

The financial statements included herein reflect all adjustments which, in the opinion of the Company, are necessary for a fair presentation of the results for the interim periods presented. All such adjustments are normal recurring adjustments. These financial statements have been prepared in accordance with generally accepted accounting principles related to interim financial statements and the applicable rules of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for annual financial statements.

The financial statements and related disclosures have been prepared with the presumption that users of the interim financial information have read or have access to the audited financial statements for the Company’s preceding fiscal year ended October 31, 2011. Accordingly, these financial statements should be read in conjunction with those audited financial statements and the related notes thereto contained in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2011, filed on January 30, 2012 (File/Film No. 000-28540/12556329) as amended by the Form 10-K/A filed on February 28, 2012 (File/Film No. 000-28540/12648015). The Company’s operating results for the three months ended January 31, 2012 are not necessarily indicative of the results that may be expected for any other interim period, for the full fiscal year ending October 31, 2012, or for any future periods. Further, the preparation of condensed consolidated financial statements requires management to make estimates and assumptions that affect the recorded amounts reported therein. A change in facts or circumstances relating to the estimates could result in a change to the estimates and could impact future operating results.

Recently Adopted Accounting Pronouncements

Fair Value Measurement Disclosure

In January 2010, the Financial Accounting Standards Board ("FASB") amended the disclosure requirements for the fair value measurements for recurring and nonrecurring non-financial assets and liabilities. The guidance requires new disclosures about transfers into and out of Levels 1 and 2 and separate disclosures about purchases, sales, issuances, and settlements relating to Level 3 measurements. It also clarifies existing fair value disclosures about the level of disaggregation and about inputs and valuation techniques used to measure fair value. The new disclosures and clarifications of existing disclosures were effective for the Company’s second quarter of fiscal year 2010, except for the disclosures about purchases, sales, issuances, and settlements relating to Level 3 measurements, which are effective for the Company’s first quarter of fiscal year 2012. The adoption of this guidance had no material impact on the Company’s consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

Goodwill Impairment Testing

In December 2010, the FASB issued guidance which amends ASC 350, Intangibles - Goodwill and Other. This Accounting Standards Update amends the criteria for performing Step 2 of the goodwill impairment test for reporting units with zero or negative carrying amounts and requires performing Step 2 if qualitative factors indicate that it is more likely than not that a goodwill impairment exists. This guidance is effective for fiscal years beginning after December 15, 2011 (November 1, 2012 for the Company). The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

6

Presentation of Comprehensive Income

In June 2011, the FASB issued ASU No. 2011-05, Presentation of Comprehensive Income. The issuance of ASU 2011-05 is intended to improve the comparability, consistency and transparency of financial reporting and to increase the prominence of items reported in other comprehensive income. The guidance in ASU 2011-05 supersedes the presentation options in ASC Topic 220 and facilitates convergence of U.S. generally accepted accounting principles and International Financial Reporting Standards by eliminating the option to present components of other comprehensive income as part of the statement of changes in stockholders' equity and requiring that all non-owner changes in stockholders' equity be presented either in a single continuous statement of comprehensive income or in two separate but consecutive statements. This guidance will be appliedretrospectively and early adoption is permitted. This guidance is effective for fiscal years and interim periods within those years, beginning after December 15, 2011 (November 1, 2012 for the Company). The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

Goodwill Impairment Testing

In September 2011, the FASB issued guidance to amend and simplify the rules related to testing goodwill for impairment. The revised guidance allows an entity to make an initial qualitative evaluation, based on the entity’s events and circumstances, to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. The results of this qualitative assessment determine whether it is necessary to perform the currently required two-step impairment test. The new guidance is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011 (November 1, 2012 for the Company). Early adoption is permitted. The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

Note 2. Fair Value Measurements

Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures, defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market for the transaction and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.

The FASB guidance also establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of inputs that may be used to measure fair value are as follows:

• Level 1: quoted prices in active markets for identical assets or liabilities;

• Level 2: inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not

active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; or

• Level 3: unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Financial Assets Measured at Fair Value on a Recurring Basis

Our significant financial assets measured at fair value on a recurring basis consisted of the following types of instruments as of January 31, 2012 (Level 1, 2 and 3 inputs are defined above):

	Fair Value Hierarchy	As of January 31, 2012
		(in thousands)
Financial assets:
Money market funds	Level 1		$	13,202
Time deposits	Level 1		8,204
Total			$	21,406
The fair value of money market funds and time deposits reflect quoted market prices in an active market.

7

Note 3. Valuation and Qualifying Accounts and Reserves

Versant evaluates and revises its allowance for doubtful accounts receivable as part of its quarter end process at the subsidiary and corporate level. The Company’s management assigns a risk factor and percentage of risk to each account receivable, the collection of which is considered non-routine. Accounts are considered past due in accordance with contractual terms which usually provide for payment within 30 to 90 days. The Company also assigns a general reserve to all its overdue accounts, excluding the non-routine items.

The following table summarizes the activities in the Company’s allowance for doubtful accounts:

	Three Months Ended			Fiscal Year Ended
	January 31, 2012			October 31, 2011
	(in thousands)
Allowance for doubtful accounts:
Beginning balance	$	16		$	8
Adjustments to provision	(4		)	8
Ending balance	$	12		$	16

The following table summarizes trade accounts receivable balances in excess of 10% of the Company's total trade accounts receivable as of January 31, 2012 and October 31, 2011 (in thousands): 

	As of January 31, 2012			As of October 31, 2011
Customer A		$	1,116		$	362
Customer B		459			*
Customer C		*			311
Customer D		*			225
* not in excess of 10% of trade accounts receivable

Note 4. Goodwill and Intangible Assets

Goodwill

The following table presents the Company’s goodwill balance as of January 31, 2012 and October 31, 2011 (in thousands):

	Net Carrying Amount
Goodwill:
Versant Europe	$	241
Poet Holdings, Inc.	5,752
FastObjects, Inc.	677
JDO Genie (PTY), Ltd	50
db4o	1,869
Total	$	8,589

Goodwill is subject to at least an annual assessment for impairment, applying a fair-value based test. Versant conducted its annual impairment test in October 2011 and determined there was no impairment. No events or circumstances occurred during the three months ended January 31, 2012 that would more likely than not reduce the fair value of the Company below its carrying amount.

8

Intangible Assets

The Company’s intangible asset balances as of January 31, 2012 and October 31, 2011 are as follows (in thousands):

	January 31, 2012						October 31, 2011
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Intangible assets:
db4o-Developed Technology (Amortized over 5 years)	$	300	$	190	$	110	$	300	$	175	$	125
db4o-Customer Relationships (Amortized over 9 years)	210		74		136		210		68		142
db4o-Trade Name (Amortized over 5 years)	100		63		37		100		58		42
Total	$	610	$	327	$	283	$	610	$	301	$	309

Aggregate amortization expense for intangible assets was $26,000 for the three months ended January 31, 2012, and $73,000 for the three months ended January 31, 2011.

The projected amortization of the Company’s existing intangible assets as of January 31, 2012 is as follows (in thousands):

	Amortization
Nine months ending October 31, 2012	$	78
Fiscal year ending October 31,
2013	103
2014	30
2015	23
2016	23
Thereafter	26
Total	$	283

Note 5.  Commitments and Contingencies

Lease commitments

Versant’s principal commitments as of January 31, 2012 consist of obligations under operating leases for facilities and equipment.

Versant leases office space for its U.S. headquarters in Redwood City, California and also leases field office space in Cupertino, California and Hamburg and Munich, Germany under operating lease agreements. The Company's operating lease arrangements as of January 31, 2012 are summarized below:

Leased Office Facility:	Lease Expiration Date	Total Rent Payable over the Remaining Lease Term		Options to Renew at Fair Value
Hamburg, Germany	11/30/2014	$	476,000	Two three year renewal options
Redwood City, California	5/31/2013	$	273,000	Two one year renewal options
Munich, Germany	2/28/2014	$	54,000	Single two year renewal option
Redwood City, California	5/31/2014	$	236,000	Single one year renewal option
Cupertino, California	1/15/2013	$	39,000	none

9

Our minimum commitments under non-cancelable operating leases that have an initial or remaining lease term in excess of one year as of January 31, 2012 are as follows (in thousands): 

	Facilities Leases		Equipment Leases		Total
Nine months ending October 31, 2012	$	372	$	4	$	376
Fiscal year ending October 31,
2013	417		2		419
2014	236				236
2015	14				14
2016	—				—
Total	$	1,039	$	6	$	1,045

Total rent expense for all operating leases was $114,000 and $96,000 for the three months ended January 31, 2012 and 2011, respectively.

Contingencies

The Company is subject to various legal proceedings and disputes that arise in the ordinary course of business from time to time. There were no ongoing material legal proceedings as of January 31, 2012.

The Company enters into indemnification agreements in the ordinary course of business. The Company's license agreements with customers generally require it to indemnify the customer against claims that its software infringes third party patent, copyright, trademark or other proprietary rights. Such indemnification obligations are generally limited in a variety of industry-standard respects. If a liability associated with any of the Company's indemnifications becomes probable and the amount of the liability is reasonably estimable or the minimum amount of a range of loss is reasonably estimable, then an appropriate liability will be established. The estimated fair value of these indemnification clauses is minimal.

Note 6. Per Share Data

Basic and diluted net income per common share has been computed using the weighted average number of shares of common stock outstanding during the period, less shares subject to repurchase. The following table presents the calculation of basic and diluted net income per share (in thousands, except per share amounts):

	Three Months Ended
	January 31, 2012		January 31, 2011
Net income	$	133	$	461
Calculation of basic net income per share:
Weighted average - common shares outstanding	2,935		3,203
Net income per share, basic	$	0.05	$	0.14
Calculation of diluted net income per share:
Weighted average - common shares outstanding	2,935		3,203
Dilutive effect of employee and director stock options	11		117
Weighted average - common shares outstanding and potentially dilutive common shares	2,946		3,320
Net income per share, diluted	$	0.05	$	0.14

For the three months ended January 31, 2012 and 2011, 616,000 and 401,000 potentially dilutive shares, respectively, were excluded from the computation of diluted net income per share by the application of the treasury stock method.

10

Note 7. Common Stock Repurchases

Fiscal Year 2012 Stock Repurchase Program

On November 28, 2011 Versant’s Board of Directors approved a new stock repurchase program announced on December 1, 2011 pursuant to which Versant is authorized to repurchase up to $5.0 million of its common stock in fiscal year 2012. This stock repurchase program is currently scheduled to expire upon the earlier of October 31, 2012, or at such time as Versant has expended $5.0 million to repurchase outstanding common shares under the program; however the program may be suspended, discontinued or extended at any earlier time by the Company.

From the date of announcement of this stock repurchase program through January 31, 2012, Versant acquired under this program a total of 18,412 common shares on the open market for approximately $0.2 million at an average purchase price of $9.44 per share, leaving approximately $4.8 million in authorized funds available for future repurchases of stock under this program. Thereafter, during the period beginning February 1, 2012 and ending March 14, 2012, Versant acquired an additional 68,987 common shares on the open market and in block trades for approximately $756,000 at an average purchase price of $10.96 per share, leaving approximately $4.1 million in authorized funds available for future repurchases of stock under this program as of March 14, 2012.

Fiscal year 2011 Stock Repurchase Program.

On November 29, 2010 Versant’s Board of Directors approved a stock repurchase program authorizing Versant to repurchase up to $5.0 million of its outstanding common shares on the open market, in block trades or otherwise. This stock repurchase program expired by its terms on October 31, 2011. Pursuant to this program, Versant acquired 240,629 common shares on the open market for approximately $3.0 million at an average purchase price of $12.23 per share.

Other Stock Repurchase

On March 10, 2011, Versant and the Company’s then Chief Executive Officer ("Former CEO") entered into a separation agreement (the “Separation Agreement”). On March 28, 2011, pursuant to the Separation Agreement, Versant repurchased 62,545 shares of Versant common stock owned by the Former CEO at a price of $13.50 per share, which reflected recent market trading prices of Versant’s common stock as of the date of the Separation Agreement.

Note 8. Employee and Director Benefit Plans

The Company grants common stock options under its 2005 Equity Incentive Plan and its 2005 Directors' Stock Option Plan and issues stock under its 2005 Employee Stock Purchase Plan, which plans have been approved by Versant's shareholders.

Shares Reserved for Future Issuance

At the Company's 2011 annual shareholder meeting, held on April 18, 2011, the shareholders approved an increase of 300,000 shares and 20,000 shares in the numbers of shares reserved under the Company's 2005 Equity Incentive Plan and 2005 Directors' Stock Option Plan, respectively.

As of January 31, 2012, the Company had reserved shares of common stock for the following purposes (in thousands):

Reserved for issuance:
Employee stock purchase plan	23
Shares available for grant	316
Unexercised stock options	674
Balance as of January 31, 2012	1,013

11

The following table summarizes stock option activities under the Company’s equity-based compensation plans during the three months ended January 31, 2012 and 2011:

	Three Months Ended January 31,
	2012				2011
	Shares in thousands		Weighted average exercise price		Shares in thousands		Weighted average exercise price
Stock option activity:
Outstanding at the beginning of the period	651		$	15.20	515		$	16.84
Granted	33		10.86		142		11.81
Exercised	(2	)	4.60		—		—
Forfeited and expired	(8	)	13.18		(5	)	77.31
Outstanding at the end of the period	674		$	15.04	652		$	15.28
Options exercisable at the end of the period	538		$	15.51	393		$	16.05

Under the 2005 Employee Stock Purchase Plan, employees may generally defer up to 10% of their compensation to purchase shares of our common stock at a purchase price equal to 85% of the lower of the fair market value per share of our common stock on (i) the commencement date of the applicable six month offering period or (ii) the applicable purchase date. During the three months ended January 31, 2012, 7,699 shares were issued under the Employee Stock Purchase Plan. Approximately 23,000 shares remained available for future issuance as of January 31, 2012.

On February 21, 2011, the Board of Directors of the Company approved an amendment to the 2005 Equity Incentive Plan to allow the grant of restricted stock units and approved the grant to employees of 29,000 common stock options and 43,950 restricted stock units which began vesting on November 1, 2011 and December 1, 2011, respectively. The Company generally considers employee equity compensation on an annual basis after the close of the fiscal year.

Note 9. Share Based Compensation

Share based compensation cost is estimated at the grant date based on the fair value of the award and is recognized as expense over the requisite service period of the award. The fair value of each option granted is estimated on the date of grant and the fair value of each share issued under Versant’s Employee Stock Purchase Plan (or “ESPP”) is estimated at the beginning of the purchase period, using the Black-Scholes Option Pricing Model, based on the following assumptions:

	Stock Options		ESPP
	Three Months Ended January 31,		Three Months Ended January 31,
	2012	2011	2012	2011
Assumptions:
Volatility	45% - 50%	48%	31% - 37%	30% - 31%
Expected life	4.25 - 5.75 years	3.8 years	6 - 12 months	6 - 12 months
Weighted average risk-free interest rate	0.65% - 1.03%	1.43%	0.06% - 0.12%	0.20% - 0.28%
Dividend yield	—	—	—	—

Share based compensation expense recognized in the condensed consolidated statements of income related to the Company’s equity incentive plans and stock purchase plan was as follows (in thousands):
	Three Months Ended
	January 31,		January 31,
	2012		2011
Share based compensation expense:
Equity Incentive Plans	$	230	$	213
ESPP	5		11
Total	$	235	$	224

12

Share based compensation recognized in the condensed consolidated statements of income, by income statement caption, was as follows (in thousands):
	Three Months Ended
	January 31,		January 31,
	2012		2011
Share based compensation expense:
Cost of revenues	$	16	$	16
Sales and marketing	72		65
Research and development	52		49
General and administrative	95		94
Total	$	235	$	224

Note 10. Restructuring

In the fourth quarter of fiscal year 2009, the Company committed to the implementation of a restructuring plan pursuant to which it closed its research and development facility in Pune, India and is winding down the affairs of its subsidiary, Versant India Private Limited (“Versant India”). The restructuring plan was undertaken to consolidate the Company’s research and development efforts into one location in Germany in order to streamline operations, create management efficiencies and increase productivity. Since the plan was undertaken, Versant has incurred restructuring costs of $203,000 as of January 31, 2012. The restructuring was substantially completed during the second quarter ended April 30, 2010. No restructuring costs were incurred in the three months ended January 31, 2012 and 2011.

Note 11. Income Taxes

The Company accounts for income taxes pursuant to the provisions of ASC 740, Income Taxes, which requires an asset and liability approach to accounting for income taxes. Deferred tax assets and liabilities are determined based on the difference between the financial statement carrying amounts and the tax basis of assets and liabilities and are measured using the enacted statutory tax rates in effect at the balance sheet date. The Company records a valuation allowance to reduce its deferred tax assets when uncertainty exists regarding the realizability of the deferred tax assets. The Company had net deferred tax assets of $834,000 and $898,000 as of January 31, 2012 and October 31, 2011, respectively.

The Company has significant deferred tax assets arising primarily from net operating loss ("NOL") carry forwards in the U.S., California and in Germany. Ultimately, the realization of the deferred tax assets is dependent upon the Company’s generation of sufficient future taxable income to enable it to use net operating loss and tax credit carry forwards during those periods in which such carry forwards can be utilized by the Company. In evaluating Versant’s ability to utilize its deferred tax assets, management of the Company considers all available positive and negative evidence, including past operating results in the most recent fiscal years and an assessment of expected future results of operations on a jurisdiction by jurisdiction basis.

The Company has experienced substantial past tax losses in its U.S. operations. Due to the lack of forecast future taxable income and the relative size of the Company’s Federal and California net operating loss carry forwards, considerable uncertainty exists that the Company will realize these deferred tax assets. Based on this objective evidence, a full valuation allowance has been recorded against the Company’s deferred tax assets related to its U.S. operations.

The Company has also experienced substantial past tax losses in its European operations. In its most recent fiscal years, the Company has generated taxable income and begun to utilize its deferred tax assets related to its German net operating loss carry forwards. Management of the Company has forecast taxable income for its European operations in fiscal year 2012. The global economic downturn has negatively impacted the Company’s operating results in all regions.  The Company has experienced declining revenues as economic conditions have remained difficult. Given the uncertainty of the macroeconomic environment, future revenues and operating results are difficult to forecast. Therefore, management has concluded it is more likely than not that the Company will realize the benefit of its deferred tax assets related to its German net operating loss carry forwards only to the extent of its expected taxable income in fiscal year 2012.

Significant management judgment is required to determine when, in the future, it will become more likely than not that additional net deferred tax assets will be realized. Management will continue to assess the realizability of the tax benefit available based on actual and forecast operating results. Management does not anticipate significant changes to its uncertain tax positions through October 31, 2012.

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 The provision for income tax expense consisted of the following (in thousands):

	Three Months Ended
	January 31,		January 31,
	2012		2011
Provision for income taxes:
Federal and state	$	4	$	—
Foreign - Europe	115		110
Foreign - India	67		—
Foreign withholding	—		3
Total current	186		113

The provision for income tax expense differs from the amount estimated by applying the statutory federal income tax rate to income before taxes, primarily due to foreign income taxed at other than U.S. rates, foreign withholding taxes and state taxes.

The Company is subject to U.S. federal income taxes and to income taxes in various states in the U.S. as well as in foreign jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or foreign tax examinations by tax authorities for tax years before 2005. However, with respect to tax years no longer subject to examination due to expiration of the statute of limitations, income may nevertheless be recomputed for the purpose of determining the amount of NOL that may be carried over to “open” years.

In conjunction with the wind-down of the Company's operations in India, an income tax inspection was conducted. Additional taxes and penalties of approximately $67,000 were imposed as a result of this inspection, which have been included in our income tax provision.

Note 12. Other Comprehensive Income (Loss)

Accumulated other comprehensive income presented in the accompanying condensed consolidated balance sheets consists of cumulative foreign currency translation adjustments.

Comprehensive income (loss) for the three month periods ended January 31, 2012 and 2011 was as follows (in thousands):
	Three Months Ended
	January 31,			January 31,
	2012			2011
Net income, as reported	$	133		$	461
Foreign currency translation adjustment	(264		)	(75		)
Comprehensive income (loss)	$	(131	)	$	386

Note 13. Segment and Geographic Information

ASC 280, Segment Reporting establishes standards for the manner in which public companies report information about operating segments in annual and interim financial statements which require the reporting of segment information using the “management approach.” Under this approach, operating segments are identified in substantially the same manner as they are reported internally and used by the Company’s chief operating decision maker (“CODM”) for purposes of evaluating performance and allocating resources. Based on this approach, the Company has determined that it operates in a single operating segment, Data Management.

One telecommunications customer accounted for approximately 13% of our total revenues in the three months ended January 31, 2012 and the related accounts receivable balance for this customer was approximately $1.1 million as of January 31, 2012.

One healthcare customer accounted for approximately 10% of total revenues in the three months ended January 31, 2011 and the related accounts receivable balance for this customer was approximately $445,000 as of January 31, 2011.

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The Company operates in North America, Europe and Asia. In general, revenues are attributed to the country in which the revenue-bearing contract originates.

The following table reflects revenues for the three months ended January 31, 2012 and 2011 by each geographic region (in thousands): 

	Three Months Ended
	January 31,		January 31,
	2012		2011
Revenues by region:
North America	$	1,028	$	1,713
Europe	3,179		2,725
Asia	136		139
	$	4,343	$	4,577

The following table reflects long-lived assets as of January 31, 2012 and October 31, 2011 in each geographic region (in thousands): 

	January 31, 2012		October 31, 2011
Total long-lived assets by region:
North America	$	457	$	438
Germany	500		588
Asia	4		5
	$	961	$	1,031

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Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Item 2 and the discussion and analysis included in this item should be read in conjunction with the Company’s financial statements and accompanying notes included in this report and the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2011, filed on January 30, 2012 (File/Film No. 000-28540/12556329), as amended by the Form 10-K/A filed on February 28, 2012 (File/Film No. 000-28540/12648015). Our historic operating results are not necessarily indicative of results that may occur in future periods.

The following discussion and analysis contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933. These forward-looking statements include, among other things, statements regarding the Company’s expected future financial performance, assets, liquidity and trends anticipated for the Company’s business. These statements are based on the Company’s current expectations, assumptions, estimates and projections about the Company’s business and the Company’s industry, which in turn are based on information that is reasonably available to the Company as of the date of this report. Forward-looking statements may include, without limitation, words such as “believes,” “anticipates,” “expects,” “intends,” “plans,” “will,” “may,” “should,” “estimates,” “predicts,” “forecasts,” “guidance,” “potential,” “continue” or the negative of such terms or other similar expressions. We caution readers that these forward-looking statements are not intended to be assurances of our future performance or financial condition and are subject to, and involve, significant known and unknown risks, uncertainties and other factors that may cause the Company’s actual operating results, financial condition, levels of activity, performance or achievement to be materially different from any future operating results, financial condition, levels of activity, performance or achievements that are expressed, forecast, projected, implied in, anticipated or contemplated by the forward-looking statements.  These known and unknown risks, uncertainties and other factors include, but are not limited to, those risks, uncertainties and factors discussed elsewhere in this report, in the Company’s other SEC filings and in Part I, Item 1A (“Risk Factors”) and in Part II, Item 7 (“Management’s Discussion and Analysis of Financial Condition and Results of Operations”) of the Company’s report on Form 10-K for the fiscal year ended October 31, 2011, as amended. Versant undertakes no obligation to revise or update any forward-looking statement in order to reflect events or circumstances that may arise or occur after the date of this report.

Background and Overview

We design, develop, market and support high performance, object-oriented database management software solutions and provide related maintenance and professional services. Our products and services address the complex data management needs of enterprises and providers of products requiring data management functions. In December 2011 we announced a strategic product roadmap in which we have outlined our plans to create database software related to very large data problems. The goal of this new product development strategy is to extend Versant's proven ability to provide data solutions for large, distributed systems to emerging so-called Big Data and near real-time analytical application opportunities. Our products and services collectively comprise our single operating segment, which we call “Data Management.”

Our end-user customers typically use our products to manage data for business systems and to enable these systems to access and integrate data necessary for the customers' data management applications. Our data management products and services offer customers the ability to manage real-time, XML and other types of hierarchical and navigational data. We believe that by using our data management solutions, customers cut their hardware costs, accelerate and simplify their development efforts, significantly reduce administration costs and deliver products and services with a significant competitive edge.

Our Data Management business is currently comprised of the following key products:

• Versant Object Database or “VOD”, previously known as VDS, an eighth generation object-oriented database management system that is used in high-performance, large-scale, real-time commercial applications in distributed computing environments. We also offer several optional ancillary products for use with Versant Object Database to extend its capabilities, provide compatibility and additional protection of stored data.

• FastObjects, an object-oriented database management system that can be embedded as a high performance component into customers' applications and systems.

• db4o, an open source object-oriented database software solution targeting the embedded device market.

Our Versant Object Database product offerings are used primarily by larger organizations, such as technology providers, telecommunications carriers, government defense agencies, defense contractors, healthcare companies and companies in the financial services and transportation industries, each of which have significant large-scale data management requirements. With the incorporation of the FastObjects solution into our product line following our March 2004 merger with Poet Holdings, Inc.,

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we expanded the scope of our solutions to also address the data management needs of smaller business systems. By our acquisition of db4o in December 2008, we further expanded the scope of our solutions to include the embedded device market.

In December 2011, we announced a new strategic product roadmap under which we plan to develop database software products to address very large data problems. Versant plans to develop these new products in order to provide data management software that enables the development of analytical application for the intelligent "real-time enterprise."

Our customers' data management needs can involve many business functions, ranging from management of the use and sharing of a company's internal enterprise data to the processing of externally originated information such as customer enrollment, billing and payment transaction data. Our solutions have also been used to solve complex data management issues such as fraud detection, risk analysis and yield management and can be adapted for use with many different applications.

In addition to our product offerings, we provide maintenance and technical support services to assist users in using our products. We also offer a variety of consulting and training services to assist users in developing and deploying applications based on Versant Object Database, FastObjects and db4o.

We license our products and sell associated maintenance, training and consulting services to end-users through our direct sales force and through value-added resellers, systems integrators and distributors.

In addition to these products and services, we resell related software developed by third parties. To date, substantially all of our revenues have been derived from the following data management products and related services:

• Sales of licenses for Versant Object Database and FastObjects;

• Maintenance and technical support services for our products, including db4o;

• Consulting and training services;

• Nonrecurring engineering fees received in connection with providing services associated with Versant Object Database;

• The resale of licenses, and maintenance, training and consulting services for third-party products that complement Versant Object Database;

• Reimbursements received for out-of-pocket expenses, which we incurred and are recorded as revenues in our statements of income.

Critical Accounting Policies and Estimates

The preparation of our consolidated financial statements requires us to make estimates and judgments that affect the reported amount of our assets and liabilities at the date of our financial statements and of our revenues and expenses during the reporting period covered by our financial statements. We base these estimates and judgments on information reasonably available to us, such as our historical experience and industry trends, economic and seasonal fluctuations and on our own internal projections that we derive from that information. Although we believe our estimates to be reasonable under the circumstances, there can be no assurances that our estimates will be accurate given that the application of these accounting policies necessarily involves the exercise of subjective judgment and the making of assumptions regarding many future variables and uncertainties. We consider “critical” those accounting policies that require our most difficult, subjective or complex judgments, and that are the most important to the portrayal of our financial condition and results of operations. These critical accounting policies relate to revenue recognition, goodwill and acquired intangible assets, and income taxes.

During the first three months of fiscal year 2012, there were no significant changes in our critical accounting policies and estimates. Please refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended October 31, 2011, filed on January 30, 2012 (File/Film No. 000-28540/12556329), as amended by Form 10-K/A filed on February 28, 2012 (File/Film No. 000-28540/12648015) for a more complete discussion of our critical accounting policies and estimates.

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Results of Operations The following table sets forth the percentage relationship of certain items from our condensed consolidated statements of income to total revenues for the periods indicated:
	Three Months Ended
	January 31,		January 31,
	2012		2011
Revenues:
License	61	%	57	%
Maintenance	38		42
Professional services	1		1
Total revenues	100		100
Cost of revenues:
License	2		2
Amortization of intangible assets	1		2
Maintenance	8		8
Professional services	—		—
Total cost of revenues	11		12
Gross profit	89		88
Operating expenses:
Sales and marketing	33		33
Research and development	26		20
General and administrative	23		23
Total operating expenses	82		76
Income from operations	7		12
Interest and other income, net	—		—
Income before provision for income taxes	7		12
Provision for income taxes	4		2
Net income	3	%	10	%

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Revenues

The following table summarizes our license, maintenance and professional services revenues for the three months ended January 31, 2012 and 2011 (in thousands, except percentages):

	Three Months Ended
	January 31,		January 31,		Change
	2012		2011		Amount			Percentage
	(unaudited)
Revenues:
License	$	2,654	$	2,596	$	58		2	%
Maintenance	1,653		1,919		(266		)	(14	)
Professional services	36		62		(26		)	(42	)
Total	$	4,343	$	4,577	$	(234	)	(5	)%

Total Revenues. Total revenues are comprised of license fees and fees for maintenance, training, consulting, technical and other support services. Fluctuations in our total revenues can be attributed to changes in economic and industry conditions, product and customer mix, general trends in information technology spending, changes in geographic demand, and the corresponding impact of changes in foreign currency exchange rates. Further, product life cycles impact revenues periodically as old contracts expire and new products are released. In addition, delays in forecast revenue transactions with customers or royalty reporting to us of items such as back maintenance charges, can cause revenue fluctuations, particularly on a quarterly basis.

Our total revenues for the three months ended January 31, 2012 decreased approximately $234,000 (or 5%) compared to the corresponding period in fiscal year 2011. This resulted primarily from an approximate $266,000 decrease in maintenance revenues that was largely attributable to a decrease in recognized back maintenance compared to the first quarter of our fiscal year 2011 and lapsed premium support contracts. Total revenues also reflected approximately $63,000 of unfavorable foreign currency exchange rate fluctuations.

One telecommunications customer accounted for approximately 13% of our total revenues in the three months ended January 31, 2012. The revenues generated by one healthcare customer accounted for approximately 10% of total revenues in the three months ended January 31, 2011.

The inherently unpredictable business cycle of an enterprise software company makes discernment of continued and meaningful business trends difficult, particularly in the current uncertain economic environment. In terms of license revenues, we are still experiencing lengthy sales cycles and customer preference for licensing our software on an “as needed” basis, versus the historical practice of prepaying license fees in advance of usage, a factor which can adversely affect the amount of our license revenues. In addition, the stagnation in general economic conditions has further lengthened our sales cycle and created increased pricing pressure, as many customers strive to reduce their operating costs. License revenues are also a critical factor in driving the amount of our services revenues, as new license customers typically enter into support and maintenance agreements with us, from which our maintenance revenues are derived over future fiscal periods. As customers endeavor to control costs, the Company has experienced, and may continue to experience, lower rates of maintenance contract renewal as well as migration from premium support options to less expensive support levels, which has, and in the future would adversely affect the levels of our maintenance revenues.

License. License revenues represent perpetual and term license fees received and recognized from our End-User and Value Added Resellers customers.

License revenues were $2.7 million for the three months ended January 31, 2012, an increase of $58,000 (or 2%) from $2.6 million reported for the comparable period in fiscal year 2011. The increase in license revenues in the quarter resulted primarily from a greater number of relatively larger license transactions in our European operations, and was partially offset by fewer larger license transactions in our North American operations. License revenues for the three months ended January 31, 2012 included an approximate $46,000 decrease resulting from unfavorable foreign currency exchange rate fluctuations.

Maintenance. Maintenance and technical support revenues include revenues derived from maintenance agreements, under which we provide customers with software upgrades and internet and telephone access to support personnel, dedicated technical assistance and emergency response support options.

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Maintenance revenues were $1.7 million for the three months ended January 31, 2012, a decrease of $266,000 (or 14%) from $1.9 million reported for the comparable period in fiscal year 2011. The decrease in maintenance revenues resulted primarily from a decrease of approximately $165,000 in recognized back maintenance in the quarter ended January 31, 2012 compared to the first quarter of fiscal year 2011. A decrease of approximately $69,000 resulting from the non-renewal of premium support by one customer and approximately $17,000 in unfavorable foreign currency exchange rate fluctuations also contributed to the decrease in maintenance revenues in the three months ended January 31, 2012 compared to the same period in fiscal year 2011.

Professional Services. Professional services revenues consist of revenues from consulting, training and technical support as well as billable travel expenses incurred by our professional services organization.

Professional services revenues were $36,000 for the three months ended January 31, 2012, a decrease of $26,000 (or 42%) from $62,000 reported for the comparable period in fiscal year 2011. This decrease was largely attributable to one consulting engagement with a European customer for approximately $53,000 performed in the first quarter of our prior fiscal year 2011 and was partially offset by an increase in services performed in our North American operations in the first quarter of fiscal year 2012.

International Revenues. The following table summarizes our revenues by geographic area for the three months ended January 31, 2012 and 2011 (in thousands, except percentages):

	Three Months Ended January 31,
			Percentage				Percentage		Change
	2012		of revenues		2011		of revenues		Amount			Percentage
	(unaudited)
Revenues by region:
North America	$	1,028	24	%	$	1,713	37	%	$	(685	)	(40	)%
Europe	3,179		73		2,725		60		454			17
Asia	136		3		139		3		(3		)	(2	)
	$	4,343	100	%	$	4,577	100	%	$	(234	)	(5	)%

Total revenues decreased approximately $234,000 (or 5%) in the three months ended January 31, 2012 compared to the corresponding period of fiscal year 2011. The decrease in total revenues was primarily due to an approximate $685,000 (or 40%) decrease in North American revenues that was partially offset by an approximate $454,000 (or 17%) increase in European revenues. Total revenues for the three months ended January 31, 2012 also included approximately $63,000 in unfavorable foreign currency exchange rate fluctuations, which are primarily connected with our European operations. Each region’s revenue as a percentage of total revenue varies from quarter to quarter as a result of the transactions specific to that region in each quarter and does not necessarily reflect a trend.

International revenues (revenues from the European and Asian regions) represented approximately 76% of our total revenues for the three months ended January 31, 2012, as compared to 63% for the comparable period in fiscal year 2011. The increase in revenues outside North America as a percentage of total revenues resulted from a greater number of larger transactions in Europe in the first quarter of fiscal year 2012, coupled with the decrease in North American revenues relative to the same period in fiscal year 2011. The decrease in North American revenues was primarily due to the absence in the first quarter of fiscal year 2012 of a transaction comparable to an approximate $463,000 license we recognized in fiscal year 2011 with one significant health care customer.

Revenues from North America. The $685,000 (or 40%) revenue decrease from North America in the three months ended January 31, 2012 was primarily the result of an approximate $494,000 decrease in license revenues and an approximate $194,000 decrease in maintenance revenues. The decrease in North American license revenues was primarily due to the absence in the first quarter of fiscal year 2012 of a transaction comparable to an approximate $463,000 license we recognized in fiscal year 2011. The decrease in North American maintenance revenues was primarily due to an approximate $165,000 decrease in recognized back maintenance compared to the first quarter of prior fiscal year 2011.

Revenues from Europe. Revenues from Europe increased $454,000 (or 17%) in the three months ended January 31, 2012, primarily due to an approximate $548,000 increase in license revenues resulting from a greater number of larger transactions and an increase in the average license volume per customer. Services revenues generated in Europe decreased due to the termination of premium maintenance and the absence of professional services revenue. Total revenues from Europe for the three months ended January 31, 2012 were also impacted by an approximate $63,000 decrease resulting from unfavorable

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foreign currency exchange rate fluctuations.

 Since the Company’s acquisition of Poet Holdings, Inc. in early 2004, we have generally derived a higher percentage of our revenues from Europe due to stronger demand for our products there. We expect in the future to continue to experience a somewhat stronger demand for our products in Europe compared to our other geographic markets.

Revenues from Asia. Revenues from the Asia Pacific region remained stable, decreasing $3,000 (or 2%) during the three months ended January 31, 2012 fcompared to the three months ended January 31, 2011.

A variety of factors may impact Versant’s future revenues, including the potential strengthening of the U.S. dollar (which would have the effect of reducing portions of our revenue resulting from favorable currency exchange fluctuations), the generally more difficult economic environment currently being experienced in the global economy, which may negatively impact demand for our products and services, and competitive market conditions.

Cost of Revenues

The following table summarizes total cost of revenues for the three months ended January 31, 2012 and 2011 (in thousands, except percentages): 

	Three Months Ended
	January 31,		January 31,		Change
	2012		2011		Amount			Percentage
	(unaudited)
Cost of revenues:
License	$	69	$	68	$	1		1	%
Amortization of intangible assets	26		73		(47		)	(64	)
Maintenance	354		373		(19		)	(5	)
Professional services	20		21		(1		)	(5	)
Total	$	469	$	535	$	(66	)	(12	)%

Total Cost of Revenues. Total cost of revenues was $469,000 (or 11% of revenues) for the three months ended January 31, 2012 declining both in absolute dollars and as a percentage of revenues compared to $535,000 (or 12% of revenues) for the comparable period in fiscal year 2011.

License. Cost of license revenues consists primarily of royalties, the cost of third party products which we resell to our customers, as well as product media, shipping and packaging costs.

Cost of license revenues was $69,000 (or 3% of license revenues) for the three months ended January 31, 2012, remaining stable with a slight increase of $1,000 (or 1%) from $68,000 (or 3% of license revenues) reported for the comparable period in fiscal year 2011.

Amortization of Intangible Assets. Amortization of intangible assets results from our fiscal year 2009 acquisition of db4o and fiscal year 2004 acquisition of Poet Holdings, Inc.

Amortization of intangible assets was $26,000 for the three months ended January 31, 2012, a decrease of $47,000 (or 64%) from $73,000 reported for the comparable period in fiscal year 2011. The decrease was due to intangible assets related to Poet Holdings, Inc. being fully amortized in the second quarter of fiscal year 2011. We expect to incur amortization charges of approximately $26,000 for the second quarter of fiscal year 2012.

Maintenance. Cost of maintenance revenues consists primarily of salaries, bonuses and consulting fees for customer support personnel and related expenses, including payroll, employee benefits and allocated overhead.

Cost of maintenance revenues was $354,000 (or 21% of maintenance revenues) for the three months ended January 31, 2012 compared to $373,000 (or 19% of maintenance revenues) reported for the comparable period in fiscal year 2011. The decrease in the cost of maintenance revenues is primarily related to reduced facilities allocation due to an overall increase in headcount and was partially offset by an approximate $3,000 decrease due to favorable foreign currency exchange rate fluctuations.

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Professional Services. Cost of professional services consists of salaries, bonuses, third party consulting fees and other costs associated with supporting our professional services organization.

Cost of professional services revenues remained stable, decreasing $1,000 to $20,000 (or 56% of professional services revenues) for the three months ended January 31, 2012 compared to $21,000 (or 34% of professional services revenues) reported for the comparable period in fiscal year 2011. Cost of professional services to provide training and consulting vary according to product mix, number of participants and travel arrangements.

Operating Expenses

The following table summarizes our operating expenses for the three months ended January 31, 2012 and 2011 (in thousands, except percentages):

	Three Months Ended
	January 31,		January 31,		Change
	2012		2011		Amount			Percentage
	(unaudited)
Operating expenses:
Sales and marketing	$	1,453	$	1,500	$	(47	)	(3	)%
Research and development	1,119		932		187			20
General and administrative	1,010		1,045		(35		)	(3	)
Total	$	3,582	$	3,477	$	105		3	%

Total Operating Expenses. Total operating expenses were $3.6 million (or 82% of revenues) for the three months ended January 31, 2012 and $3.5 million (or 76% of revenues) for the comparable period in fiscal year 2011. The $105,000 (or 3%) increase in total operating expenses for the three months ended January 31, 2012 resulted primarily from increased investment in research and development and included an approximate decrease of $23,000 due to favorable foreign currency exchange rate fluctuations.

Sales and Marketing. Sales and marketing expenses consist primarily of personnel and personnel related expenses, commissions earned by sales personnel, and expenses associated with trade shows, travel and other marketing communication costs, such as advertising and public relations.

Sales and marketing expenses were $1.5 million (or 33% of revenues) for the three months ended January 31, 2012 and $1.5 million (or 33% of revenues) for the comparable period in fiscal year 2011. The $47,000 decrease (or 3%) in sales and marketing expenses in the three months ended January 31, 2012 compared to the corresponding period in 2011 includes an approximate $83,000 decrease in sales employee costs and associated travel in our European operations, an approximate $63,000 decrease in sales commissions on reduced revenues in our North American operations, a $40,000 decrease in sales recruiting costs and a decrease of approximately $7,000 resulting from favorable foreign currency exchange fluctuations. These decreases were partially offset by an approximate $146,000 increase related to the expansion of our marketing activities, including our new marketing communications manager, director of energy sector business development and our new product manager as well as increased marketing programs.

We expect our sales and marketing expenses to increase moderately during fiscal year 2012 due to anticipated increases in programs to implement our Big Data strategic initiative and we expect that sales and marketing expenses will continue to represent a considerable percentage of our total operating expenditures in the future.

Research and Development. Research and development expenses consist primarily of personnel and related expenses, including payroll and employee benefits, expenses for facilities and payments made to outside software development contractors.

Research and development expenses were $1.1 million (or 26% of revenues) for the three months ended January 31, 2012 and $0.9 million (or 20% of revenues) for the comparable period in fiscal year 2011. The $187,000 (or 20%) increase was primarily due to an approximate $153,000 increase in personnel costs in both Germany and the United States and an approximate $42,000 increase in related travel and facilities costs as we invest in new product developments to pursue our 2012 strategic roadmap. Research and development expenses for the three months ended January 31, 2012 included an approximate $12,000 decrease due to favorable foreign currency exchange fluctuations.

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We expect our research and development expenses to increase significantly in fiscal year 2012 compared to our research and development expense levels in fiscal year 2011. We plan to invest resources in new product developments to pursue our 2012 strategic roadmap to develop data management software that enables the development of analytical applications. We expect our research and development expenses to continue to increase over the remainder of fiscal year 2012.

General and Administrative. General and administrative expenses consist primarily of personnel and related expenses and general operating expenses.

General and administrative expenses were $1.0 million (or 23% of revenues) for the three months ended January 31, 2012 and $1.0 million (or 23% of revenues) for the comparable period in fiscal year 2011. The $35,000 (or 3%) decrease in general and administrative expense for the three months ended January 31, 2012 compared to the three months ended January 31, 2011 was primarily due to an approximate $25,000 decrease in executive bonuses and an approximate $19,000 decrease in bad debt expense, which were partially offset by an approximate $22,000 increase in consulting costs. General and administrative expense for the three months ended January 31, 2012 compared to the three months ended January 31, 2011 included an approximate $4,000 decrease due to favorable foreign currency exchange fluctuations.

We expect our general and administrative expenses in fiscal year 2012 to continue to decrease compared to fiscal year 2011.

Interest and Other Income, Net

The following table summarizes our interest and other income, net for the three months ended January 31, 2012 and 2011 (in thousands, except percentages):

	Three Months Ended
	January 31,			January 31,			Change
	2012			2011			Amount			Percentage
	(unaudited)
Interest and other income, net:
Interest income	$	42		$	17		$	25		147	%
Foreign exchange loss	(15		)	(8		)	(7		)	88
Total	$	27		$	9		$	18		200	%

Interest and other income, net, consists of interest income earned on our cash and cash equivalents, net of interest expense due to our financing activities, miscellaneous refunds and foreign exchange rate gains or losses as a result of settling transactions denominated in currencies other than our functional currency.

Interest and other income, net, was income of $27,000 (or less than 1% of total revenues) and $9,000 (or less than 1% of total revenues) for the three months ended January 31, 2012 and 2011, respectively. The approximate $18,000 (or 200%) increase in interest and other income, net for the three months ended January 31, 2012 is primarily due to an increase in earned interest on our cash reserves that was partially offset by the unfavorable change in foreign exchange gains and losses resulting from settling transactions denominated in currencies other than our functional currency.

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Provision for Income Taxes

The following table reflects the Company’s income tax expense for the three months ended January 31, 2012 and 2011 (in thousands, except percentages):

	Three Months Ended
	January 31,		January 31,		Change
	2012		2011		Amount			Percentage
	(unaudited)
Provision for income taxes:
Foreign withholding taxes	$	—	$	3	$	(3	)	(100	)%
Provision for income taxes - Europe	115		110		5			5
Provision for income taxes - India	67		—		67			100
Federal, state and franchise taxes	4		—		4			100
Total	$	186	$	113	$	73		65	%

The Company’s tax provisions were based upon our projected fiscal year 2012 and 2011 effective tax rates. We incurred foreign withholding taxes of approximately $3,000 for the three months ended January 31, 2011, which we have included in our income tax provision. We incurred less than $1,000 in foreign withholding taxes for the three months ended January 31, 2012.

Although we have not exhausted our net operating tax loss carry forwards in Germany, the German tax code provides for certain annual statutory limitations related to the use of tax loss carry forward amounts. We recorded income tax expense for our European operations of approximately $115,000 and $110,000, for the three months ended January 31, 2012 and 2011, respectively.

In conjunction with the wind-down of our operations in India, we were subject to an income tax inspection. Additional taxes and penalties of approximately $67,000 were imposed as a result of this inspection, which have been included in our income tax provision.

In evaluating our ability to utilize our deferred tax assets, we consider all available positive and negative evidence, including our past operating results in the most recent fiscal years and our assessment of expected future results of operations on a jurisdiction by jurisdiction basis. Significant management judgment is required to determine when, in the future, the realization of our net deferred tax assets will become more likely than not. The Company will continue to assess the realizability of the tax benefit available based on actual and forecast operating results.

Liquidity and Capital Resources

The following table sets forth certain consolidated balance sheets data as of January 31, 2012 and October 31, 2011 and certain consolidated statements of cash flows data for the three months ended January 31, 2012 and 2011 (in thousands, except percentages):

	January 31, 2012		October 31, 2011		Percentage Change
	(unaudited)
Working Capital	$	22,819	$	22,784	—%
Cash and cash equivalents	$	23,017	$	23,145	(1%)

	Three Months Ended
	January 31,			January 31,			Percentage
	2012			2011			Change
	(unaudited)
Net cash provided by operating activities	$	243		$	981		(75)%
Net cash used in investing activities	(86		)	(215		)	(60)%
Net cash used in financing activities	$	(94	)	$	(332	)	(72)%

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Cash and Cash Equivalents

We funded our business from cash generated by our operations during the three months ended January 31, 2012. As of January 31, 2012, we had cash and cash equivalents of approximately $23.0 million, a decrease of $128,000 from the $23.1 million of cash and cash equivalents we held at October 31, 2011.

As of January 31, 2012, $9.7 million of our $23.0 million in cash and cash equivalents was held in foreign financial institutions, of which $2.7 million was held in foreign currencies.

The following table summarizes our cash balances held in foreign currencies and their equivalent U.S. dollar amounts (in thousands):
	January 31, 2012				October 31, 2011
	Local Currency		U.S. Dollar		Local Currency		U.S. Dollar
	(unaudited)				(unaudited)
Cash in foreign currency:
Euros	€	1,888	$	2,482	€	1,919	$	2,716
British Pound	£	—	—		£	—	—
Indian Rupee	Rs	11,746	234		Rs	12,824	265
Total			$	2,716			$	2,981

Foreign Currency Risk. We transact business in various foreign currencies and, accordingly, we are subject to exposure from adverse movements in foreign currency exchange rates. The effect of changes in foreign currency exchange rates on our net operating results in the first quarter of fiscal year 2012, as compared to the first quarter of fiscal year 2011, was comprised of approximately $63,000 of unfavorable foreign currency fluctuations on our revenues, $3,000 of favorable foreign currency fluctuations on our cost of revenues, and $23,000 of favorable foreign currency fluctuations on our operating expenses, resulting in a net unfavorable effect of approximately $37,000 on our income from operations for the three months ended January 31, 2012.

Operating expenses incurred by our foreign subsidiaries are denominated primarily in local currencies. We currently do not use financial instruments to hedge these operating expenses. While we intend to continue to assess the need to utilize financial instruments to hedge currency exposures on an ongoing basis, we do not at this time anticipate establishing any hedging during fiscal year 2012.

Our exposure to foreign exchange risk is primarily related to the magnitude of foreign net profits and losses denominated in euros, as well as our net position of monetary assets and monetary liabilities in the euro (though in the future the same could be true of other foreign currencies depending on the source of our revenues). This exposure has the potential to produce either gains or losses within our consolidated results. However, in some instances our European operations act as a natural hedge, since both operating expenses as well as revenues are denominated in local currencies. In these instances, although an unfavorable change in the exchange rate of the euro against the U.S. dollar will result in lower revenues when translated into U.S. dollars, our European operating expenditures will be lower as well.

Additionally, we held approximately 88% of our total cash and cash equivalents balances at January 31, 2012 in the form of U.S. dollars to assist in minimizing the impact of foreign currency fluctuations.

In relation to our cash balances held overseas, there were no European Union foreign exchange restrictions on repatriating our overseas-held cash to the United States. However, we may be subject to income tax withholding in the source countries and to U.S. federal and state income taxes in the future if the cash payment or transfer from our subsidiaries to the U.S. parent were to be characterized as a dividend. Other payments made by our European overseas subsidiaries in the ordinary course of business (e.g. payment of royalties or interest from the subsidiaries to the U.S. parent) were generally not subject to income tax withholding under existing tax treaties.

Interest Rate Risk. Our cash equivalents primarily consist of money market accounts and short term time deposits; accordingly, our interest rate risk is not considered significant.

Stock Repurchase Program. On November 28, 2011 our Board of Directors approved a new stock repurchase program announced on December 1, 2011, pursuant to which Versant is authorized to repurchase up to $5.0 million of its common stock

25

in fiscal year 2012. This stock repurchase program is currently scheduled to expire upon the earlier of October 31, 2012, or at such time as Versant has expended $5.0 million to repurchase outstanding common shares under the program; however the program may be suspended, discontinued or extended at any earlier time by the Company.

From the date of announcement of this stock repurchase program through January 31, 2012, Versant acquired under this program a total of 18,412 common shares on the open market for approximately $0.2 million at an average purchase price of $9.44 per share, leaving approximately $4.8 million in authorized funds available for future repurchases of stock under this program. Thereafter, during the period beginning February 1, 2012 and ending March 14, 2012, Versant acquired an additional 68,987 common shares on the open market and in block trades for approximately $756,000 at an average purchase price of $10.96 per share, leaving approximately $4.1 million in authorized funds available for future repurchases of stock under this program as of March 14, 2012.

Taking into consideration the contingent cash outflows related to potential common stock repurchases, our current cost structure, our anticipated expenses and our current estimates of revenues and collections in fiscal year 2012, we expect to operate with a moderate negative cash flow in fiscal year 2012.

Cash Flow provided by Operating Activities

The main source of our operating cash flows is cash collections from customers who have purchased or resold our products and services. Our primary uses of cash in operating activities are for personnel related expenditures and facility costs.

We generated $243,000 of cash flows from operations in the three months ended January 31, 2012. This amount resulted from $133,000 in net income adjusted for non-cash charges of $374,000 and a $264,000 increase in operating assets net of liabilities during the first three months of fiscal year 2012. The increase in operating assets net of liabilities was primarily related to an approximate $1.9 million increase in trade accounts receivable partially offset by an approximate $1.0 million increase in deferred revenues and an approximate $396,000 increase in accrued liabilities largely related to income and value added tax liabilities. The increase in deferred revenues and a significant portion of the increase in trade accounts receivable in this quarter result from the fact that many of our customers renew their maintenance contracts on a calendar year basis.

We generated $981,000 of cash flows from operations in the three months ended January 31, 2011. This amount resulted from $461,000 in net income adjusted for non-cash charges of $372,000, and a $148,000 decrease in operating assets net of liabilities during the first quarter of fiscal 2011. The decrease in operating assets net of liabilities was primarily related to an approximate $948,000 increase in deferred revenues and other short-term liabilities offset by an approximate $784,000 increase in trade accounts receivable.

The timing of payments to our vendors for accounts payable and collections from our customers for accounts receivable will significantly impact cash flows in our operating activities. We typically pay our vendors and service providers in accordance with their invoice terms and conditions. Our standard payment terms for our invoices are usually between 30 and 90 days net.

We measure the effectiveness of our collection efforts by an analysis of our accounts receivable and our days sales outstanding (DSO). We calculate DSO by taking the ending accounts receivable balances (net of bad debt allowance) divided by the average daily sales amount. Average daily sales amount is calculated by dividing the total quarterly revenue recognized net of changes in deferred revenues by 91.25 days. Our DSOs were 68 days and 69 days for the three months ended January 31, 2012 and 2011, respectively. Collections of accounts receivable and related DSO could fluctuate in future periods due to the timing and amount of our revenues and the effectiveness of our collection efforts.

Cash Flow used in Investing Activities

For the three months ended January 31, 2012, $86,000 of cash was used in investing activities for the purchases of property and equipment, including software licenses and infrastructure for our server room.

For the three months ended January 31, 2011, $215,000 of cash was used in investing activities for the purchases of property and equipment, including new hardware for testing environments.

Cash Flow used in Financing Activities

On November 28, 2011 and November 29, 2010, our Board of Directors approved stock repurchase programs. Under each program, the Company was authorized to repurchase up to $5.0 million worth of its outstanding common shares from time to time on the open market, in block trades or otherwise. The stock repurchase program approved on November 30, 2010 expired pursuant to its own terms on October 31, 2011.

26

The primary source of cash flows from financing activities is proceeds from the sale of common stock under our Equity Incentive Plan, Directors’ Plan and Employee Stock Purchase Plan.

For the three months ended January 31, 2012, $94,000 of cash was used in financing activities, consisting of $175,000 of cash used to repurchase our common stock, which was partially offset by cash inflows of $81,000 from the issuance of common stock under our Equity Incentive and Employee Stock Purchase Plans.

For the three months ended January 31, 2011, $332,000 of cash was used by financing activities, consisting of $404,000 of cash used to repurchase our common stock, which was partially offset by cash inflows of $72,000 from the issuance of common stock under our Equity Incentive and Employee Stock Purchase Plans.

Our future liquidity and capital resources could be impacted by our stock repurchase program as described above, and by the exercise of outstanding common stock options and the cash proceeds we receive upon exercise of these securities. As of January 31, 2012, we had approximately 23,000 shares available to issue under our Employee Stock Purchase Plan, approximately 316,000 shares available to issue under our current Equity Incentive Plan and our Directors' Stock Option Plan and approximately 674,000 shares in outstanding option grants under our equity plans. The timing of the issuance, the duration of vesting provisions and the grant price will all impact the timing of any proceeds. Accordingly, we cannot estimate the amount of such proceeds at this time.

Commitments and Contingencies

Our principal commitments as of January 31, 2012 consist of obligations under operating leases for facilities and equipment. As reported in Note 5, Commitments and Contingencies of the Notes to Condensed Consolidated Financial Statements (unaudited) under Item 1 of Part I, of this Report, the Company leases office space for its U.S. headquarters in Redwood City, California and also leases field office space in Hamburg and Munich, Germany under multi-year operating lease agreements.

The Company enters into indemnification agreements in the ordinary course of business. The Company's license agreements with customers generally require it to indemnify the customer against claims that its software infringes third party patent, copyright, trademark or other proprietary rights. Such indemnification obligations are generally limited in a variety of industry-standard respects. If a liability associated with any of the Company's indemnifications becomes probable and the amount of the liability is reasonably estimable or the minimum amount of a range of loss is reasonably estimable, then an appropriate liability will be established. The estimated fair value of these indemnification clauses is minimal, though the Company has received correspondence from a customer asserting that the Company has a potential indemnification obligation to such customer. Based on currently available information, the Company disputes this assertion.

On November 28, 2011, our Board of Directors approved a new stock repurchase program pursuant to which the Company is authorized to repurchase up to $5.0 million of its common stock in fiscal year 2012. The stock repurchase program is currently scheduled to expire upon the earlier of October 31, 2012, or upon such time as Versant has expended $5.0 million to repurchase outstanding common shares under the program; however the program may be earlier suspended, discontinued, or extended at any time by the Company.

After taking into account potential common stock repurchases under our current stock repurchase program, we believe that our existing cash and cash equivalents and cash to be generated from operations will be sufficient to finance our operations during the next twelve months. However, if we fail to generate adequate cash flows from operations in the future, due to an unexpected decline in our revenues, difficulties or delays in collection of revenues or due to a sustained increase in cash expenditures in excess of the revenues generated, then our cash balances may not be sufficient to fund our continuing operations without obtaining additional debt or equity financing. Additional cash may also be needed to acquire or invest in complementary businesses or products or to obtain the right to use complementary technologies, and we expect that, in the event of such an acquisition or investment that is significant, it will be necessary for us to seek additional debt or equity financing.

Recent Accounting Pronouncements

For recent accounting pronouncements see Note 1, Basis of Presentation and Recent Accounting Pronouncements of Notes to Condensed Consolidated Financial Statements under Part I, Item 1 of this Report.

27

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Foreign Currency Risk. We transact business in various foreign currencies and, accordingly, we are subject to exposure from adverse movements in foreign currency exchange rates. The effect of changes in foreign currency exchange rates on our net operating results in the first quarter of fiscal year 2012, as compared to the first quarter of fiscal year 2011, was comprised of approximately $63,000 of unfavorable foreign currency fluctuations on our revenues, $3,000 of favorable foreign currency fluctuations on our cost of revenues, and $23,000 of favorable foreign currency fluctuations on our operating expenses, resulting in a net unfavorable effect of approximately $37,000 on our income from operations for the three months ended January 31, 2012.

Operating expenses incurred by our foreign subsidiaries are denominated primarily in local currencies. We currently do not use financial instruments to hedge these operating expenses. While we intend to continue to assess the need to utilize financial instruments to hedge currency exposures on an ongoing basis, we do not at this time anticipate establishing any hedging during fiscal year 2012.

Our exposure to foreign exchange risk is primarily related to the magnitude of foreign net profits and losses denominated in euros, as well as our net position of monetary assets and monetary liabilities in the euro (though in the future the same could be true of other foreign currencies depending on the source of our revenues). This exposure has the potential to produce either gains or losses within our consolidated results. However, in some instances our European operations act as a natural hedge, since both operating expenses as well as revenues are denominated in local currencies. In these instances, although an unfavorable change in the exchange rate of the euro against the U.S. dollar will result in lower revenues when translated into U.S. dollars, our European operating expenditures will be lower as well.

Additionally, we held approximately 88% of our total cash and cash equivalents balances at January 31, 2012 in the form of U.S. dollars to assist in minimizing the impact of foreign currency fluctuations.

Interest Rate Risk. Our cash equivalents primarily consist of money market accounts and short term time deposits; accordingly, our interest rate risk is not considered significant.

We do not own any derivative financial instruments as of January 31, 2012.

Item 4. Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

Our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934), include components of our internal control over financial reporting. Management’s assessment of the effectiveness of our internal control over financial reporting is expressed at the level of reasonable assurance because a control system, no matter how well designed and operated, can provide only reasonable, but not absolute, assurance that the control system’s objectives will be met.

Based on the evaluation of the effectiveness of our disclosure controls and procedures by our management, with the participation of our chief executive officer and chief financial officer, as of the end of the period covered by this report our chief executive officer and chief financial officer have concluded that our disclosure controls and procedures were effective to provide reasonable assurance that (i) information required to be disclosed in the reports that the Company files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms and (ii) is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

(b) Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting  (as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act) during the three months ended January 31, 2012 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II.  OTHER INFORMATION

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(c) Purchase of Equity Securities by the Issuer and Affiliated Purchasers

On November 28, 2011 Versant’s Board of Directors approved a new stock repurchase program pursuant to which Versant is authorized to repurchase up to $5.0 million of its common stock in fiscal year 2012. This stock repurchase program is currently scheduled to expire upon the earlier of October 31, 2012, or at such time as Versant has expended $5.0 million to repurchase outstanding common shares under the program; however the program may be suspended, discontinued or extended at any earlier time by the Company.

The stock repurchase activity during the three months ended January 31, 2012 is summarized as follows:

Issuer Purchases of Equity Securities
	Total Number of Shares Purchased (2)	Average Price Paid Per Share (1)		Total Number of Shares Purchased as Part of Publicly Announced Plan or Program	Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan or Program
Period:
November 1 - November 30, 2011	—	$	—	—	$	—
December 1 - December 31, 2011	8,011	9.36		74,958	$	4,925,042
January 1 - January 31, 2012	10,401	9.51		98,938	$	4,826,104
Three months ended January 31, 2012	18,412	$	9.44	173,896

(1) Average price paid per share is calculated on a settlement basis and excludes commission.

(2) All repurchases reflected in the above table were made pursuant to the Company's fiscal 2012 stock repurchase program, announced on December 1, 2011, which authorizes the repurchase of up to $5.0 million of common stock. The stock repurchase program is currently scheduled to expire upon the earlier of October 31, 2012, or at such time as Versant has expended $5.0 million to repurchase outstanding common shares under the program; however the program may be suspended, discontinued, terminated or extended at any time by the Company.

Item 5. Other Information

Versant Corporation expects to hold its 2012 Annual Meeting of Shareholders at a date, time and location to be announced, which will be more than thirty days after the anniversary date of the 2011 annual meeting of stockholders.

The deadline for receipt of stockholder proposals for inclusion in the Company's proxy statement and form of proxy for the 2012 Annual Meeting in accordance with Rule 14a-8 under the Exchange Act was set at November 11, 2011. In order for a proposal to be considered timely, it must have been received in writing by the Company on or prior to the applicable date at the Company's principal executive offices, located at 255 Shoreline Drive, Suite 450, Redwood City, CA 94065.

In addition, in order for shareholder nominations of directors or other shareholder proposals made outside of Rule 14a-8 under the Exchange Act to be considered “timely” within the meaning of Rule 14a-4(c) of the Exchange Act, such proposal must have been received by the Company at the address set forth above on or before the close of business on by January 26, 2012. In order for either type of proposal to be considered, such notice must also contain certain information specified in the Company's Bylaws.

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Item 6.  Exhibits

(a)  Exhibits

The following exhibits are filed with this Quarterly Report on Form 10-Q:

Exhibit  Number	Exhibit Description
31.01	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.02	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.01*	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.02*	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.01	Registrant's 2005 Equity Incentive Plan, as amended**
99.02	Form of Restricted Stock Unit Agreement and Restricted Stock Unit Award under Registrant's 2005 Equity Incentive Plan, as amended**
101.ins†	XBRL Instance Document
101.sch†	XBRL Schema Document
101.cal†	XBRL Calculation Linkbase Document
101.pre†	XBRL Presentation Linkbase Document
101.lab†	XBRL Label Linkbase Document
101.def†	XBRL Definition Linkbase Document

 ___________________________________________________

*This exhibit is being furnished rather than filed, and shall not be deemed incorporated by reference into any filing, in accordance with Item 601 of Regulation S-K.

**    Management or compensatory plan

†     In accordance with Rule 406T of Regulation S-T, the information in these exhibits is furnished and deemed not filed or part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of section 18 of the Exchange Act of 1934, and otherwise is not subject to liability under these sections.

30

SIGNATURES

Pursuant to the requirements 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.

		VERSANT CORPORATION
Dated:	March 16, 2012	/s/ Bernhard Woebker
		Bernhard Woebker
		Chief Executive Officer (Duly Authorized Officer and Principal Executive Officer) and Director
		/s/ Jerry Wong
		Jerry Wong
		Vice President, Finance, Chief Financial Officer (Duly Authorized Officer, Principal Financial Officer and Chief Accounting Officer)

31

EX-31.01

Exhibit 31.01

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Bernhard Woebker, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Versant Corporation (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:    March 16, 2012

By:    /s/ Bernhard Woebker

Bernhard Woebker

Chief Executive Officer

EX-31.02

Exhibit 31.02

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Jerry Wong, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Versant Corporation (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:    March 16, 2012

By:    /s/ Jerry Wong

Jerry Wong

Vice President, Finance and Chief Financial Officer

EX-32.01

Exhibit 32.01

Certification of Chief Executive Officer

Furnished Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of Versant Corporation (the “Company”) on Form 10-Q for the quarter ended January 31, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Bernhard Woebker, as Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company for the quarterly period covered by the Report.

/s/ Bernhard Woebker

Bernhard Woebker

Chief Executive Officer

March 16, 2012

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.01

EXHIBIT 32.02

Certification of Chief Financial Officer

Furnished Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of Versant Corporation (the “Company”) on Form 10-Q for the quarter ended January 31, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Jerry Wong, as Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company for the quarterly period covered by the Report.

/s/ Jerry Wong

Jerry Wong

Vice President, Finance and Chief Financial Officer

March 16, 2012

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-99.01

VERSANT CORPORATION

2005 EQUITY INCENTIVE PLAN

As Adopted June 1, 2005 and as Amended through April 24, 2011¹ and February 21, 2012

1.PURPOSE; EFFECTIVE DATE. The purpose of this Plan is to provide incentives to attract, retain and motivate eligible persons whose present and potential contributions are important to the success of the Company, its Parent and Subsidiaries, by offering them an opportunity to participate in the Company's future performance through awards of Options, Restricted Stock, Stock Bonuses and Restricted Stock Units. This Plan will become effective on the first date (the “Effective Date”) on which it has been both (a) adopted by the Board and (b) approved by the shareholders of the Company. Capitalized terms not defined in the text are defined in Section 24.

2.SHARES SUBJECT TO THE PLAN.

2.1.Number of Shares Available. Subject to Sections 2.2 and 19, the total number of Shares reserved and available for grant and issuance pursuant to this Plan (the “Reserved Shares”) will be the sum of (a) the Available Prior Plan Shares (as defined below) plus (b) any and all Forfeited Prior Plan Shares (as defined below); provided, that the number of Reserved Shares shall not exceed an aggregate of 1,155,685Shares, as constituted at the opening of business on the Effective Date. The “Available Prior Plan Shares” means the number of shares of the Company's Common Stock reserved for issuance under the Company's 1996 Equity Incentive Plan, as amended (the “Prior Plan”) on the Effective Date that, on the Effective Date, are not (i) issued and outstanding as a result of the grant or exercise of awards granted under the Prior Plan or (ii) subject to stock options or other awards granted under the Prior Plan that are then outstanding. “Forfeited Prior Plan Shares” means (i) shares of Common Stock issued under the Prior Plan that are outstanding on the Effective Date and are thereafter repurchased by the Company at their original issuance price pursuant to the terms of the Prior Plan and/or agreements entered pursuant thereto and (ii) the shares of Common Stock that, on the Effective Date, are subject to any then outstanding stock option granted under the Prior Plan and which thereafter cease to be subject to such stock option for any reason other than its exercise. The Available Prior Plan Shares and all Forfeited Prior Plan Shares will no longer be available for grant and issuance under the Prior Plan but will be available for grant and issuance under this Plan. Subject to Sections 2.2 and 19, (x) Shares that are subject to issuance upon exercise of an Option granted under this Plan but that cease to be subject to such Option for any reason other than exercise of such Option, (y) Shares that are subject to any Award granted under this Plan but are forfeited or are repurchased by the Company at their original issue price or (z) Shares that are subject to an Award granted under this Plan that otherwise terminates without Shares being issued, will again be available for grant and issuance in connection with future Awards under this Plan. At all times the Company shall reserve and keep available a sufficient number of Shares as shall be required to satisfy the requirements of all outstanding Options granted under this Plan and all other outstanding but unvested Awards granted under this Plan. No more than one million (1,000,000) Shares may be issued under this Plan pursuant to the exercise of ISOs.

2.2.Adjustment of Shares. In the event that the number of outstanding Shares is changed by a stock dividend, recapitalization, stock split, reverse stock split, subdivision, combination, reclassification or similar change in the capital structure of the Company without consideration, then (a) the number of Shares reserved for issuance under this Plan, (b) the maximum number of Reserved Shares set forth in Section 2.1 above, (c) and the maximum number of Shares that may be issued under this Plan pursuant to the exercise of ISOs as set forth in Section 2.1 above, (d) the Exercise Prices of and number of Shares subject to outstanding Options, (e) the number of Shares subject to other outstanding Awards and (f) the numbers of Shares referenced in Section 3 below, will each be proportionately adjusted, subject to any required action by the Board or the shareholders of the Company and compliance with applicable securities laws; provided, however, that fractions of a Share will either be replaced by a cash payment equal to the Fair Market Value of such fraction of a Share or will be rounded up to the nearest whole Share, as determined by the Committee.

3.ELIGIBILITY. ISOs (as defined in Section 5 below) may be granted only to employees (including officers and directors who are also employees) of the Company or of a Parent or Subsidiary of the Company. All other Awards may be granted to employees, officers, directors, consultants, independent contractors and advisors of the Company or any Parent or Subsidiary of the Company; provided such consultants, independent contractors and advisors render bona fide services not in connection with the offer and sale of securities in a capital-raising transaction. No person will be eligible to receive more than 40,000 Shares in any calendar year under this Plan pursuant to the grant

¹ Numbers of shares have been adjusted to reflect the 1-for-10 reverse split of the Company’s outstanding Common Stock that took effect on August 22, 2005.

of Awards hereunder, other than new employees of the Company or of a Parent or Subsidiary of the Company (including new employees who are also officers and directors of the Company or any Parent or Subsidiary of the Company) who are eligible to receive up to a maximum of 60,000 Shares in the calendar year in which they commence their employment. A person may be granted more than one Award under this Plan.

4.ADMINISTRATION.

4.1.Committee Authority. This Plan will be administered by the Committee or by the Board acting as the Committee. Subject to the general purposes, terms and conditions of this Plan, and to the direction of the Board, the Committee will have full power to implement and carry out this Plan. Without limitation, the Committee will have the authority to:

(a) construe and interpret this Plan, any Award Agreement and any other agreement or document executed pursuant to this Plan;

(b) prescribe, amend and rescind rules and regulations relating to this Plan;

(c) select persons to receive Awards;

(d) determine the form and terms of Awards;

(e) determine the number of Shares or other consideration subject to Awards;

(f) determine whether Awards will be granted singly, in combination with, in tandem with, in replacement of, or as alternatives to, other Awards under this Plan or any other incentive or compensation plan of the Company or any Parent or Subsidiary of the Company;

(g) grant waivers of Plan or Award conditions;

(h) determine the vesting, exercisability and payment of Awards;

(i) correct any defect, supply any omission or reconcile any inconsistency in this Plan, any Award or any Award Agreement;

(j) determine whether an Award has been earned; and

(k) make all other determinations necessary or advisable for the administration of this Plan.

4.2.Committee Discretion. Any determination made by the Committee with respect to any Award will be made in its sole discretion at the time of grant of the Award or, unless in contravention of any express term of this Plan or Award, at any later time, and such determination will be final and binding on the Company and on all persons having an interest in any Award under this Plan. The Committee may delegate to one or more officers of the Company the authority to grant an Award under this Plan to Participants who are not Insiders of the Company.

4.3.Exchange Act Requirements. During all times that the Company is subject to Section 16 of the Exchange Act, the Company will take appropriate steps to comply with the requirements of SEC Rule 16b-3 (or other rules of the SEC) for the exemption of awards from the application of Section 16(b) of the Exchange Act.

5.OPTIONS. The Committee may grant Options to eligible persons and will determine whether such Options will be Incentive Stock Options within the meaning of the Code (“ISOs”) or Nonqualified Stock Options (“NQSOs”), the number of Shares subject to the Option, the Exercise Price of the Option, the period during which the Option may be exercised, and all other terms and conditions of the Option, subject to the following:

5.1.Form of Option Grant. Each Option granted under this Plan will be evidenced by an Award Agreement which will expressly identify the Option as an ISO or an NQSO (“Stock Option Agreement”), and will be in such form and contain such provisions (which need not be the same for each Participant) as the Committee may from time to time approve, and which will comply with and be subject to the terms and conditions of this Plan.

5.2.Date of Grant. The date of grant of an Option will be the date on which the Committee makes the determination to grant such Option, unless otherwise specified by the Committee. The Stock Option Agreement and a copy of this Plan will be delivered to the Participant within a reasonable time after the granting of

the Option.

5.3.Exercise Period; Vesting. Options may be exercisable immediately (subject to repurchase pursuant to Section 13 of this Plan) or may be exercisable within the times or upon the events determined by the Committee as set forth in the Stock Option Agreement governing such Option. Notwithstanding the foregoing: (a) no Option will be exercisable after the expiration of ten (10) years from the date the Option is granted; (b) no ISO granted to a person who directly or by attribution owns more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or of any Parent or Subsidiary of the Company (“Ten Percent Shareholder”) will be exercisable after the expiration of five (5) years from the date the ISO is granted; and (c) in no event shall an Option that is granted to an employee who is a non-exempt employee for purposes of overtime pay under the Fair Labor Standards Act of 1938 be exercisable earlier than six (6) months after its date of grant. The Committee also may provide for the exercise of Options to become exercisable at one time or from time to time, periodically or otherwise, in such number of Shares or percentage of Shares as the Committee determines; provided that (subject to earlier termination of the Option) each Option granted to a non-officer employee shall vest at the rate of no less than twenty percent (20%) of the total number of Shares originally subject to such Option (as such number may be adjusted pursuant to Section 2) per year over the five (5) year period beginning on the date such Option is granted, subject to such person's continued employment with the Company or Parent or Subsidiary. Unless the Committee provides otherwise, the vesting of an Option granted under this Plan may be suspended during any leave of absence as may be set forth in any Company policy.

5.4.Exercise Price. The Exercise Price of an Option will be determined by the Committee when the Option is granted and will not be less than 100% of the Fair Market Value of the Shares on the date of grant (110% in the case of any ISO granted to a Ten Percent Shareholder). Payment for the Shares purchased may be made in accordance with Section 9 of this Plan.

5.5.Method of Exercise. Options may be exercised only by delivery to the Company of a stock option exercise agreement (the “Exercise Agreement”) in a form approved by the Committee (which need not be the same for each Participant), stating the number of Shares being purchased, the restrictions imposed on the Shares purchased under such Exercise Agreement, if any, and such representations and agreements regarding Participant's investment intent and access to information and other matters, if any, as may be required or desirable by the Company to comply with applicable securities laws, together with payment in full of the Exercise Price for the number of Shares being purchased.

5.6.Termination. Notwithstanding the exercise periods set forth in the Stock Option Agreement, exercise of an Option will always be subject to the following:

(a) If the Participant is Terminated for any reason except death or Disability, then the Participant may exercise such Participant's Options only to the extent that such Options would have been exercisable upon the Termination Date no later than three (3) months after the Termination Date (or such shorter or longer time period not exceeding five (5) years after the Termination Date as may be determined by the Committee, with any exercise beyond three (3) months after the Termination Date deemed to be an NQSO), but in any event, no later than the expiration date of the Options.

(b) If the Participant is Terminated because of Participant's death or Disability (or the Participant dies within three (3) months after a Termination other than because of Participant's death or disability), then Participant's Options may be exercised only to the extent that such Options would have been exercisable by Participant on the Termination Date and must be exercised by Participant (or Participant's legal representative or authorized assignee) no later than twelve (12) months after the Termination Date (or such shorter or longer time period not exceeding five (5) years after the Termination Date as may be determined by the Committee, with any such exercise beyond (a) three (3) months after the Termination Date when the Termination is for any reason other than the Participant's death or Disability, or (b) twelve (12) months after the Termination Date when the Termination is for Participant's death or Disability, deemed to be an NQSO), but in any event no later

than the expiration date of the Options.

(c) If a Participant is determined by the Board to have committed an act of theft, embezzlement, fraud, dishonesty or a breach of fiduciary duty to the Company or Parent or Subsidiary, neither such Participant, such Participant's estate nor such other person who may then hold the Option shall be entitled to exercise any Option with respect to any Shares whatsoever, after termination of service, whether or not after termination of service such Participant may receive payment from the Company or Subsidiary for vacation pay, for services rendered prior to termination, for services rendered for the day on which termination occurs, for salary in lieu of notice, or for any other benefits. In making the determination described in this subsection, the Board shall give the Participant an opportunity to present evidence to the Board. For the purpose of this paragraph, termination of service shall be deemed to occur on the date when the Company dispatches notice or advice to the Participant that such Participant's service is terminated.

5.7.Limitations on Exercise. The Committee may specify a reasonable minimum number of Shares that may be purchased on any exercise of an Option, provided that such minimum number will not prevent Participant from exercising the Option for the full number of Shares for which it is then exercisable.

5.8.Limitations on ISO. The aggregate Fair Market Value (determined as of the date of grant) of Shares with respect to which ISOs are exercisable for the first time by a Participant during any calendar year (under this Plan or under any other incentive stock option plan of the Company, Parent or Subsidiary of the Company) will not exceed $100,000. If the Fair Market Value of Shares on the date of grant with respect to which ISOs are exercisable for the first time by a Participant during any calendar year exceeds $100,000, then the Options for the first $100,000 worth of Shares to become exercisable in such calendar year will be ISOs and the Options for the amount in excess of $100,000 that become exercisable in that calendar year will be NQSOs. In the event that the Code or the regulations promulgated thereunder are amended after the Effective Date of this Plan to provide for a different limit on the Fair Market Value of Shares permitted to be subject to ISO, such different limit will be automatically incorporated herein and will apply to any Options granted after the effective date of such amendment.

5.9.Modification, Extension or Renewal. The Committee may modify, extend or renew outstanding Options and authorize the grant of new Options in substitution therefor, provided that any such action may not, without the written consent of a Participant, impair any of such Participant's rights under any Option previously granted. Any outstanding ISO that is modified, extended, renewed or otherwise altered will be treated in accordance with Section 424(h) of the Code. The Committee may reduce the Exercise Price of outstanding Options without the consent of Participants affected by a written notice to them only if and to the extent that such Repricing is permitted under the terms of Section 16 of this Plan; provided, however, that the Exercise Price may not be reduced below the minimum Exercise Price that would be permitted under Section 5.4 of this Plan for Options granted on the date the action is taken to reduce the Exercise Price.

5.10.No Disqualification. Notwithstanding any other provision in this Plan, no term of this Plan relating to ISOs will be interpreted, amended or altered, nor will any discretion or authority granted under this Plan be exercised, so as to disqualify this Plan under Section 422 of the Code or, without the consent of the Participant affected, to disqualify any ISO under Section 422 of the Code.

6.RESTRICTED STOCK. A Restricted Stock Award is an offer by the Company to sell to an eligible person Shares that are subject to restrictions. The Committee will determine to whom an offer will be made, the number of Shares the person may purchase, the price to be paid (the “Purchase Price”), the restrictions to which the Shares will be subject, and all other terms and conditions of the Restricted Stock Award, subject to the following:

6.1.Form of Restricted Stock Award. All purchases under a Restricted Stock Award made pursuant to this Plan will be evidenced by an Award Agreement (“Restricted Stock Purchase Agreement”) that will be in such form (which need not be the same for each Participant) as the Committee will from time to time approve, and will comply with and be subject to the terms and conditions of this Plan. The offer of Restricted Stock will be accepted by the Participant's execution and delivery of the Restricted Stock Purchase Agreement and full payment for the Shares to the Company within thirty (30) days from the date the Restricted Stock Purchase Agreement is delivered

to the Participant. If such Participant does not execute and deliver the Restricted Stock Purchase Agreement along with full payment for the Shares to the Company within thirty (30) days, then the offer of such Restricted Stock will terminate, unless otherwise determined by the Committee.

6.2.Purchase Price. The Purchase Price of Shares sold pursuant to a Restricted Stock Award will be determined by the Committee and will be at least 100% of the Fair Market Value of the Shares on the date the Restricted Stock Award is granted. Payment of the Purchase Price may be made in accordance with Section 8 of this Plan.

6.3.Restrictions. Restricted Stock Awards will be subject to such restrictions (if any) as the Committee may impose. The Committee may provide for the lapse of such restrictions in installments and may accelerate or waive such restrictions, in whole or part, based on length of service, performance or such other factors or criteria as the Committee may determine.

7.STOCK BONUSES.

7.1.Awards of Stock Bonuses. A Stock Bonus is an award of Shares (which may consist of Restricted Stock) for services rendered to the Company or any Parent or Subsidiary of the Company. A Stock Bonus may be awarded for past services already rendered to the Company, or any Parent or Subsidiary of the Company pursuant to an Award Agreement (the “Stock Bonus Agreement”) that will be in such form (which need not be the same for each Participant) as the Committee will from time to time approve, and will comply with and be subject to the terms and conditions of this Plan. A Stock Bonus may be awarded upon satisfaction of such performance goals as are set out in advance in the Participant's individual Award Agreement (the “Performance Stock Bonus Agreement”) that will be in such form (which need not be the same for each Participant) as the Committee will from time to time approve, and will comply with and be subject to the terms and conditions of this Plan. Stock Bonuses may vary from Participant to Participant and between groups of Participants, and may be based upon the achievement of the Company, Parent or Subsidiary and/or individual performance factors or upon such other criteria as the Committee may determine.

7.2.Terms of Stock Bonuses. The Committee will determine the number of Shares to be awarded to the Participant and whether such Shares will be Restricted Stock. If the Stock Bonus is being earned upon the satisfaction of performance goals pursuant to a Performance Stock Bonus Agreement, then the Committee will determine: (a) the nature, length and starting date of any period during which performance is to be measured (the “Performance Period”) for each Stock Bonus; (b) the performance goals and criteria to be used to measure the performance, if any; (c) the number of Shares that may be awarded to the Participant; and (d) the extent to which such Stock Bonuses have been earned. Performance Periods may overlap and Participants may participate simultaneously with respect to Stock Bonuses that are subject to different Performance Periods and different performance goals and other criteria. The number of Shares may be fixed or may vary in accordance with such performance goals and criteria as may be determined by the Committee. The Committee may adjust the performance goals applicable to the Stock Bonuses to take into account changes in law and accounting or tax rules and to make such adjustments as the Committee deems necessary or appropriate to reflect the impact of extraordinary or unusual items, events or circumstances to avoid windfalls or hardships.

7.3.Form of Payment. The earned portion of a Stock Bonus may be paid currently or on a deferred basis with such interest or dividend equivalent, if any, as the Committee may determine. Payment may be made in the form of cash, whole Shares, including Restricted Stock, or a combination thereof, either in a lump sum payment or in installments, all as the Committee will determine.

7.4.Termination During Performance Period. If a Participant is Terminated during a Performance Period for any reason, then such Participant will be entitled to payment (whether in Shares, cash or otherwise) with respect to the Stock Bonus only to the extent such Stock Bonus is earned as of the date of Termination in accordance with the terms of the applicable Performance Stock Bonus Agreement, unless the Committee will determine otherwise.

8.RESTRICTED STOCK UNITS.

8.1.Awards of Restricted Stock Units. A Restricted Stock Unit (“RSU”) is an Award covering a number of Shares that may be settled in cash, or by issuance of those Shares at a date in the future. No Purchase Price shall apply to an RSU settled in Shares. All grants of Restricted Stock Units will be evidenced by an Award

Agreement that will be in such form (which need not be the same for each Participant) as the Committee will from time to time approve, and will comply with and be subject to the terms and conditions of this Plan.

8.2.Form and Timing of Settlement. To the extent permissible under applicable law, the Committee may permit a Participant to defer payment under a RSU to a date or dates after the RSU is earned, provided that the terms of the RSU and any deferral satisfy the requirements of Section 409A of the Code (or any successor) and any regulations or rulings promulgated thereunder. Payment may be made in the form of cash or while Shares or a combination thereof, all as the Committee determines.

8.3.Restrictions. RSU Awards may be subject to the restrictions set forth in Section 13 hereof or such other restrictions not inconsistent with Section 25102(o) of the California Corporations Code.

8.4.Non-Transferability. Except as permitted by the Committee, awards of RSUs under this Plan, and any interest therein, will not be transferable or assignable by Participant, other than by will or by the laws of descent and distribution, and may not be made subject to execution, attachment or similar process. For the avoidance of doubt, the prohibition against assignment and transfer shall be understood to include, without limitation, a prohibition against any pledge, hypothecation, or other transfer, including any short position, any “put equivalent position” or any “call equivalent position” (in each case, as defined in Rule 16a-1 promulgated under the Exchange Act).

9.PAYMENT FOR SHARE PURCHASES. Payment for Shares purchased pursuant to this Plan may be made in cash (by check) or, where expressly approved for the Participant by the Committee and where permitted by law:

(a) by cancellation of indebtedness of the Company to the Participant;

(b) by surrender of shares that either: (1) have been owned by Participant for more than six (6) months and have been paid for within the meaning of SEC Rule 144 (and, if such shares were purchased from the Company by use of a promissory note, such note has been fully paid with respect to such shares); or (2) were obtained by Participant in the public market;

(c) by waiver of compensation due or accrued to the Participant for services rendered;

(d) with respect only to purchases upon exercise of an Option, and provided that a public market for the Company's stock exists:

(1) through a “same day sale” commitment from the Participant and a broker-dealer that is a member of the National Association of Securities Dealers (an “NASD Dealer”) whereby the Participant irrevocably elects to exercise the Option and to sell a portion of the Shares so purchased to pay for the Exercise Price, and whereby the NASD Dealer irrevocably commits upon receipt of such Shares to forward the Exercise Price directly to the Company; or

(2) through a “margin” commitment from the Participant and a NASD Dealer whereby the Participant irrevocably elects to exercise the Option and to pledge the Shares so purchased to the NASD Dealer in a margin account as security for a loan from the NASD Dealer in the amount of the Exercise Price, and whereby the NASD Dealer irrevocably commits upon receipt of such Shares to forward the Exercise Price directly to the Company; or

(e) by any combination of the foregoing.

10.WITHHOLDING TAXES.

10.1.Withholding Generally. Whenever Shares are to be issued in satisfaction of Awards granted under this Plan, the Company may require the Participant to remit to the Company an amount sufficient to satisfy federal, state and local withholding tax requirements prior to the delivery of any certificate or certificates for such Shares. Whenever, under this Plan, a payment in satisfaction of an Award is to be made in cash, each such payment will be net of an amount sufficient to satisfy federal, state, and local withholding tax requirements.

10.2.Stock Withholding. When, under applicable tax laws, a Participant incurs tax liability in connection with the exercise or vesting of any Award that is subject to tax withholding and the Participant is obligated

to pay the Company the amount required to be withheld, the Committee may in its sole discretion allow the Participant to satisfy the minimum withholding tax obligation by electing to have the Company withhold from the Shares to be issued that number of Shares having a Fair Market Value equal to the minimum amount required to be withheld, determined on the date that the amount of tax to be withheld is to be determined (the “Tax Date”). All elections by a Participant to have Shares withheld for this purpose will be made in writing in a form acceptable to the Committee and will be subject to the following restrictions:

(a) the election must be made on or prior to the applicable Tax Date;

(b) once made, then except as provided below, the election will be irrevocable as to the particular Shares as to which the election is made;

(c) all elections will be subject to the consent or disapproval of the Committee;

(d) if the Participant is an Insider and if the Company is subject to Section 16(b) of the Exchange Act: (1) the election may not be made within six (6) months of the date of grant of the Award, except as otherwise permitted by SEC Rule 16b-3(e) under the Exchange Act, and (2) either (A) the election to use stock withholding must be irrevocably made at least six (6) months prior to the Tax Date (although such election may be revoked at any time at least six (6) months prior to the Tax Date) or (B) the exercise of the Option or election to use stock withholding must be made in the ten (10) day period beginning on the third day following the release of the Company's quarterly or annual summary statement of sales or earnings; and

(e) in the event that the Tax Date is deferred until six (6) months after the delivery of Shares under Section 83(b) of the Code, the Participant will receive the full number of Shares with respect to which the exercise occurs, but such Participant will be unconditionally obligated to tender back to the Company the proper number of Shares on the Tax Date.

11.PRIVILEGES OF STOCK OWNERSHIP.

11.1.Voting and Dividends. No Participant will have any of the rights of a shareholder with respect to any Shares until the Shares are issued to the Participant. After Shares are issued to the Participant, the Participant will be a shareholder and have all the rights of a shareholder with respect to such Shares, including the right to vote and receive all dividends or other distributions made or paid with respect to such Shares; provided, that if such Shares are Restricted Stock, then any new, additional or different securities the Participant may become entitled to receive with respect to such Shares by virtue of a stock dividend, stock split or any other change in the corporate or capital structure of the Company will be subject to the same restrictions as the Restricted Stock; provided, further, that the Participant will have no right to retain such stock dividends or stock distributions with respect to Shares that are repurchased at the Participant's original Purchase Price pursuant to Section 13.

11.2.Financial Statements. The Company will provide financial statements to each Participant prior to such Participant's purchase of Shares under this Plan, and to each Participant annually during the period such Participant has Awards outstanding; provided, however, except as required by applicable law the Company will not be required to provide such financial statements to Participants whose services in connection with the Company assure them access to equivalent information.

12.TRANSFERABILITY. Awards granted under this Plan, and any interest therein, will not be transferable or assignable by Participant, and may not be made subject to execution, attachment or similar process, otherwise than by will or by the laws of descent and distribution or as consistent with the specific Plan and Award Agreement provisions relating thereto. During the lifetime of the Participant any Award granted to such Participant will be exercisable only by such Participant, and any elections with respect to any such Award, may be made only by such Participant.

13.RESTRICTIONS ON SHARES. At the discretion of the Committee, the Company may reserve to itself and/or its assignee(s) in the Award Agreement a right to repurchase a portion of or all Shares held by a Participant following such Participant's Termination at any time within ninety (90) days after the later of Participant's Termination Date and the date Participant purchases Shares under this Plan, for cash and/or cancellation of purchase money

indebtedness, at: (A) with respect to Shares that are “Vested” (as defined in the Award Agreement), the higher of: (l) Participant's original Purchase Price, or (2) the Fair Market Value of such Shares on Participant's Termination Date, provided, that such right of repurchase (i) must be exercised as to all such “Vested” Shares unless a Participant consents to the Company's repurchase of only a portion of such “Vested” Shares and (ii) terminates when the Company's securities become publicly traded; or (B) with respect to Shares that are not “Vested” (as defined in the Award Agreement), at the Participant's original Purchase Price, provided that, for any Participant who is a non-officer employee immediately prior to such Participant's Termination, the right to repurchase at the original Purchase Price lapses at the rate of at least 20% per year over five (5) years from the date the Shares were purchased (or from the date of grant of options in the case of Shares obtained pursuant to a Stock Option Agreement and Stock Option Exercise Agreement).

14.CERTIFICATES. All certificates for Shares or other securities delivered under this Plan will be subject to such stock transfer orders, legends and other restrictions as the Committee may deem necessary or advisable, including restrictions under any applicable federal, state or foreign securities law, or any rules, regulations and other requirements of the SEC or any stock exchange or automated quotation system upon which the Shares may be listed or quoted.

15.ESCROW; PLEDGE OF SHARES. To enforce any restrictions on a Participant's Shares, the Committee may require the Participant to deposit all certificates representing Shares, together with stock powers or other instruments of transfer approved by the Committee, appropriately endorsed in blank, with the Company or an agent designated by the Company to hold in escrow until such restrictions have lapsed or terminated, and the Committee may cause a legend or legends referencing such restrictions to be placed on the certificates.

16.REPRICING PROHIBITED WITHOUT SHAREHOLDER APPROVAL. A Repricing (as that term is defined in Section 24 of this Plan) is prohibited without prior shareholder approval. Subject to compliance with the provisions of the immediately preceding sentence regarding a Repricing, the Committee may, at any time or from time to time: (a) authorize the Company, with the consent of the respective Participants, to issue new Awards in exchange for the surrender and cancellation of any or all outstanding Awards or (b) buy from a Participant an Award previously granted with payment in cash, Shares (including Restricted Stock) or other consideration, based on such terms and conditions as the Committee and the Participant may agree. The exercise of the authority provided in this Section 16 is circumscribed to the extent necessary to avoid the inadvertent application of the interest and additional tax provisions of Section 409A of the Code.

17.SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. An Award will not be effective unless such Award is in compliance with all applicable federal and state securities laws, rules and regulations of any governmental body, and the requirements of any stock exchange or automated quotation system upon which the Shares may then be listed or quoted, as they are in effect on the date of grant of the Award and also on the date of exercise or other issuance. Notwithstanding any other provision in this Plan, the Company will have no obligation to issue or deliver certificates for Shares under this Plan prior to: (a) obtaining any approvals from governmental agencies that the Company determines are necessary or advisable; and/or (b) completion of any registration or other qualification of such Shares under any state or federal law or ruling of any governmental body that the Company determines to be necessary or advisable. The Company will be under no obligation to register the Shares with the SEC or to effect compliance with the registration, qualification or listing requirements of any state securities laws, stock exchange or automated quotation system, and the Company will have no liability for any inability or failure to do so.

18.NO OBLIGATION TO EMPLOY. Nothing in this Plan or any Award granted under this Plan will confer or be deemed to confer on any Participant any right to continue in the employ of, or to continue any other relationship with, the Company or any Parent or Subsidiary of the Company or limit in any way the right of the Company or any Parent or Subsidiary of the Company to terminate Participant's employment or other relationship at any time, with or without cause.

19.CORPORATE TRANSACTIONS.

19.1.Assumption or Replacement of Awards by Successor. In the event of (a) a dissolution or liquidation of the Company, (b) a merger or consolidation in which the Company is not the surviving corporation (other than a merger or consolidation with a wholly-owned subsidiary, a reincorporation of the Company in a different jurisdiction, or other transaction in which there is no substantial change in the shareholders of the Company or their relative stock holdings and the Awards granted under this Plan are assumed, converted or replaced by the successor

corporation, which assumption will be binding on all Participants), (c) a merger or consolidation in which the Company is the surviving corporation but the Company's shareholders immediately prior to the consummation of the merger or consolidation (other than any shareholder that merges or consolidates, or controls another corporation that merges or consolidates, with the Company in such merger or consolidation) own less than 50% of the surviving corporation immediately after such merger or consolidation, or (d) the sale of substantially all of the assets of the Company, any or all outstanding Awards may be assumed, converted or replaced by the successor corporation (if any), which assumption, conversion or replacement will be binding on all Participants. In the alternative, the successor corporation may substitute equivalent awards or provide substantially similar consideration to Participants as was provided to shareholders (after taking into account the existing provisions of the Awards). The successor corporation may also issue, in place of then outstanding Shares held by any Participant, substantially similar shares or other property subject to repurchase restrictions no less favorable to such Participant. In the event such successor corporation (if any) refuses to assume or substitute Awards, as provided above, pursuant to a transaction described in this Subsection 19.1, such Awards will expire on such transaction at such time and on such conditions as the Board will determine.

19.2.Other Treatment of Awards. Subject to any greater rights granted to Participants under the foregoing provisions of this Section 19, in the event of the occurrence of any transaction described in Section 19.1, any outstanding Awards will be treated as provided in the applicable agreement or plan of merger, consolidation, dissolution, liquidation, sale of assets or other “corporate transaction.”

19.3.Assumption of Awards by the Company. The Company, from time to time, also may substitute or assume outstanding awards granted by another company, whether in connection with an acquisition of such other company or otherwise, by either; (a) granting an Award under this Plan in substitution of such other company's award; or (b) assuming such award as if it had been granted under this Plan if the terms of such assumed award could be applied to an Award granted under this Plan. Such substitution or assumption will be permissible if the holder of the substituted or assumed award would have been eligible to be granted an Award under this Plan if the other company had applied the rules of this Plan to such grant. In the event the Company assumes an award granted by another company, the terms and conditions of such award will remain unchanged (except that the exercise price and the number and nature of Shares issuable upon exercise of any such option will be adjusted appropriately pursuant to Section 424(a) of the Code). In the event the Company elects to grant a new Option rather than assuming an existing option, such new Option may be granted with a similarly adjusted Exercise Price.

20.SHAREHOLDER APPROVAL. This Plan shall be approved by the shareholders of the Company (excluding Shares issued pursuant to this Plan), consistent with applicable laws, within twelve (12) months before or after the date this Plan is adopted by the Board. Upon the Effective Date, the Board may grant Awards pursuant to this Plan; provided, however, that: (a) no Option may be exercised prior to initial shareholder approval of this Plan; (b) no Option granted pursuant to an increase in the number of Shares subject to this Plan approved by the Board will be exercised prior to the time such increase has been approved by the shareholders of the Company; and (c) in the event that shareholder approval of such increase is not obtained within the time period provided herein, all Awards granted hereunder pursuant to such increase will be canceled, any Shares issued pursuant to any such Award will be canceled, and any purchase of Shares pursuant to such increase will be rescinded. So long as the Company is subject to Section 16(b) of the Exchange Act, the Company will comply with the requirements of Rule 16b-3 (or its successor), as amended, with respect to shareholder approval.

21.TERM OF PLAN/GOVERNING LAW. Unless earlier terminated as provided herein, this Plan will terminate ten (10) years from the date this Plan is adopted by the Board or, if earlier, the date of shareholder approval. This Plan and all agreements thereunder shall be governed by and construed in accordance with the laws of the State of California.

22.AMENDMENT OR TERMINATION OF PLAN. The Board may at any time terminate or amend this Plan in any respect, including without limitation amendment of any form of Award Agreement or instrument to be executed pursuant to this Plan; provided, however, that the Board will not, without the approval of the shareholders of the Company, amend this Plan in any manner that requires such shareholder approval pursuant to the Code or the regulations promulgated thereunder as such provisions apply to ISO plans, the California Department of Corporations, or (if the Company is subject to the Exchange Act or Section 16(b) of the Exchange Act) pursuant to the Exchange Act or SEC Rule 16b-3 (or its successor), as amended, thereunder, respectively.

23.NONEXCLUSIVITY OF THE PLAN. Neither the adoption of this Plan by the Board, the

submission of this Plan to the shareholders of the Company for approval, nor any provision of this Plan will be construed as creating any limitations on the power of the Board to adopt such additional compensation arrangements as it may deem desirable, including, without limitation, the granting of stock options and bonuses otherwise than under this Plan, and such arrangements may be either generally applicable or applicable only in specific cases.

24.DEFINITIONS. As used in this Plan, the following terms will have the following meanings:

“Award” means any award under this Plan, including any Option, Restricted Stock, Stock Bonus or Restricted Stock Unit.

“Award Agreement” means, with respect to each Award, the signed written agreement between the Company and the Participant setting forth the terms and conditions of the Award.

“Board” means the Board of Directors of the Company.

“Code” means the Internal Revenue Code of 1986, as amended.

“Committee” means the committee appointed by the Board to administer this Plan, or if no such committee is appointed, the Board.

“Company” means Versant Corporation, a California corporation, or any successor corporation.

“Disability” means a disability, whether temporary or permanent, partial or total, within the meaning of Section 22(e)(3) of the Code, as determined by the Committee.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Exercise Price” means the price at which a holder of an Option may purchase the Shares issuable upon exercise of the Option.

“Fair Market Value” means, as of any date, the value of a share of the Company's Common Stock determined as follows:

(a)    if such Common Stock is then quoted on the Nasdaq National Market or the Nasdaq SmallCap Market, then its closing price on such market on the date of determination as reported in The Wall Street Journal;

(b)    if such Common Stock is publicly traded and is then listed on a national securities exchange, its closing price on the date of determination on the principal national securities exchange on which the Common Stock is listed or admitted to trading as reported in The Wall Street Journal; or

(c)    if none of the foregoing is applicable, by the Committee in good faith.

“Insider” means an officer or director of the Company or any other person whose transactions in the Company's Common Stock are subject to Section 16 of the Exchange Act.

“Option” means an award of an option to purchase Shares pursuant to Section 5.

“Parent” means any corporation (other than the Company) in an unbroken chain of corporations ending with the Company, if at the time of the granting of an Award under this Plan, each of such 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.

“Participant” means a person who receives an Award under this Plan.

“Plan” means this Versant Corporation 2005 Equity Incentive Plan, as amended from time to time.

“Repricing” means any of the following or any other action that has the same purpose and effect: (a) lowering the exercise price of an outstanding Option granted under this Plan after it is granted; (b) any other action affecting an outstanding Award granted under this Plan that is treated as a repricing under United States generally accepted accounting principles; (c) canceling an outstanding Award granted under this Plan at a time when its exercise or purchase price exceeds the then fair market value of the stock underlying such outstanding Award, in exchange for another Award or a cash payment, unless the cancellation and exchange occurs in connection with a merger, consolidation, sale of substantially all the Company's assets, acquisition, spin-off or other similar corporate transaction.

“Restricted Stock Award” means an award of Shares pursuant to Section 6.

“Restricted Stock Unit” or “RSU” means an award made pursuant to Section 8 hereof.

“SEC” means the Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended.

“Shares” means shares of the Company's Common Stock reserved for issuance under this Plan, as adjusted pursuant to Sections 2 and 19, and any successor security.

“Stock Bonus” means an award of Shares, or cash in lieu of Shares, pursuant to Section 7.

“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.

“Termination” or “Terminated” means, for purposes of this Plan with respect to a Participant, that the Participant has for any reason ceased to provide services as an employee, director, independent contractor, consultant, or advisor to the Company or a Parent or Subsidiary of the Company. An employee will not be deemed to have ceased to provide services in the case of (i) sick leave, (ii) military leave, or (iii) any other leave of absence approved by the Committee, provided, that such leave is for a period of not more than 90 days, unless reemployment upon the expiration of such leave is guaranteed by contract or statute or unless provided otherwise pursuant to a formal policy adopted from time to time by the Company and issued and promulgated to employees in writing. In the case of any employee on an approved leave of absence, the Committee may make such provisions respecting suspension of vesting of the Option while on leave from the employ of the Company or a Subsidiary as it may deem appropriate, except that in no event may an Option be exercised after the expiration of the term set forth in the Option agreement. The Committee will have sole discretion to determine whether a Participant has ceased to provide services and the effective date on which the Participant ceased to provide services (the “Termination Date”).

EX-99.02

VERSANT CORPORATION

2005 EQUITY INCENTIVE PLAN

Notice of Restricted Stock Unit Award

Grant Number: [_______]

Terms defined in the Company's 2005 Equity Incentive Plan, as amended (the “Plan”) shall have the same meanings in this Notice of Restricted Stock Unit Award (“Notice of Grant”).

Name: ___________________________________

Address: _______________________________________________________________

You have been granted an award of Restricted Stock Units (“RSUs”) by Versant Corporation (the “Company”), subject to the terms and conditions of the Plan and the Restricted Stock Unit Agreement attached hereto as Annex 1 (hereinafter “RSU Agreement”) under the Plan, as follows:

Total Number of RSUs:    [___________________]

RSU Grant Date:    [_____________, 2____]

Vesting Start Date:    [______________, 2___]

Expiration Date: The earlier to occur of: (a) the date on which settlement of all vested RSUs granted hereunder occurs; and (b) the tenth (10^th) anniversary of the Grant Date.

Vesting: The RSUs will vest with respect to the first [____]% of the RSUs when you complete [_________] [A time period to be determined, such as “months” or 'calendar quarters'] of continuous Service after the Vesting Start Date. The RSUs will vest with respect to an additional [_____]% of the RSUs when you complete each successive [A time period to be determined] of continuous Service thereafter. “Service” means you provide services as an employee, [director], independent contractor, consultant, or advisor to the Company or a Parent or Subsidiary of the Company.

Settlement: Subject to the provisions of the RSU Agreement, settlement of RSUs shall be made within 30 days following the applicable date of vesting under the vesting schedule set forth above. Settlement of RSUs shall be in Shares. Settlement means the delivery of the Shares vested under an RSU. Settlement of vested RSUs shall occur whether or not you are in Service at the time of settlement. No fractional RSUs or rights for fractional Shares shall be created pursuant to this Notice of Grant.

You also understand that this Notice of Grant is subject to the terms and conditions of both the RSU Agreement and the Plan, both of which are incorporated herein by reference.

By your acceptance hereof (whether written, electronic or otherwise), you agree, to the fullest extent permitted by law, that in lieu of receiving documents in paper format, you accept the electronic

delivery of any documents the Company, or any third party involved in administering the Plan which the Company may designate, may deliver in connection with this grant (including the Plan, the Notice of Grant, the RSU Agreement, Prospectus, account statements, or other communications or information) whether via the Company's intranet or the Internet site of such third party or via email or such other means of electronic delivery specified by the Company.

By your signature and the signature of the Company's representative on the Notice of Grant, you and the Company agree that this RSU is granted under and governed by the terms and conditions of the Plan, the Notice of Grant and the RSU Agreement. By your signature, you consent to electronic delivery as set forth in Section 14 of the RSU Agreement.

PARTICIPANTVERSANT CORPORATION

_______________________________________        By:______________________________

Name: ___________________________

Title: ____________________________

ANNEX 1

VERSANT CORPORATION

Restricted Stock Unit Agreement

under the 2005 Equity Incentive Plan

You have been granted Restricted Stock Units (“RSUs”) by Versant Corporation (the “Company”) subject to the terms, restrictions and conditions of the Company's 2005 Equity Incentive Plan, as amended (the “Plan”), the Notice of Restricted Stock Unit Award (“Notice of Grant”) and this RSU Agreement. Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this RSU Agreement (the “Agreement”).

1. No Stockholder Rights; Adjustments. Unless and until such time as Shares are issued in settlement of vested RSUs, you shall have no ownership of the Shares allocated to the RSUs and shall have no right to dividends or to vote any of such Shares or any other rights of a shareholder of the Company with respect to such Shares. The number of RSUs and the number of Shares deliverable with respect to such RSUs will be adjusted from time to time for capitalization adjustments as described in the Plan.

2.No Cash Dividend Equivalents. Cash dividends, if any, shall not be credited to you.

3.No Transfer. The RSUs and any interest therein shall not be sold, assigned, transferred, pledged, hypothecated, or otherwise disposed of, other than by will or by the laws of descent and distribution. Notwithstanding the foregoing, you may, in the manner established by the Committee, designate a beneficiary or beneficiaries to exercise your rights and receive any property distributable with respect to the RSUs upon your death.

4.Termination. If your Service ceases for any reason, all RSUs for which vesting is no longer possible under the terms of the Notice of Grant and this Agreement shall be forfeited to the Company forthwith, and all your rights to such [unvested] RSUs shall immediately terminate. In case of any dispute as to whether such termination has occurred, the Committee shall have sole discretion to determine whether such termination has occurred and the effective date of such termination.

5.Limitations on Transfer of Stock. In addition to any other limitation on transfer created by applicable securities laws, you shall not assign, encumber or dispose of any interest in the Shares issued pursuant to this Agreement except in compliance with the provisions of this Agreement, the Plan and the Company's Insider Trading Policy. Any sale or transfer of the Shares shall be void unless the provisions of this Agreement are satisfied.

6.Withholding of Tax. When the RSUs are settled the fair market value of the Shares is treated as income subject to withholding by the Company for income and employment taxes if you are or were an employee of the Company. The Company shall withhold an amount equal to the tax due at vesting and/or settlement from your other compensation or require you to remit to the Company an amount equal to the tax then due. In its sole discretion, the Company may instead withhold on settlement a number of Shares otherwise issuable to you upon settlement of the RSUs having a fair market value (determined on the date the Shares are settled) equal to the minimum amount the Company is then required to withhold for taxes.

7.Code Section 409A. This RSU is intended to be exempt from Internal Revenue Code

Section 409A (“Section 409A”) pursuant to Treasury Regulation Section 1.409A-1(b)(4) and will be construed in accordance therewith to the greatest extent permitted under applicable law, with vested shares issued hereunder not later than the 15th day of the third month following the end of the tax year (the Company's or yours, whichever is later) in which such shares are no longer subject to a substantial risk of forfeiture. For purposes of this Agreement, a termination of employment will be determined consistent with the rules relating to a “separation from service” as defined in Section 409A. Notwithstanding anything else provided herein, to the extent any payments provided under this Agreement in connection with your termination of Service constitute deferred compensation subject to Section 409A, and you are deemed at the time of such termination of Service to be a “specified employee” under Section 409A, then such payment shall not be made or commence until the earlier of (i) the expiration of the 6-month period measured from your separation from service from the Company or (ii) the date of your death following such a separation from service; provided, however, that such deferral shall only be effected to the extent required to avoid adverse tax treatment to you including, without limitation, the additional tax for which you would otherwise be liable under Section 409A(a)(1)(B) in the absence of such a deferral. The first payment thereof will include a catch-up payment covering the amount that would have otherwise been paid during the period between your termination of Service and the first payment date but for the application of this provision, and the balance of the installments (if any) will be payable in accordance with their original schedule. To the extent that any provision of this Agreement is ambiguous as to its compliance with Section 409A, the provision will be read in such a manner so that all payments hereunder comply with Section 409A. Payments pursuant to this section are intended to constitute separate payments for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations.

8.Tax Consequences. You acknowledge that there will be tax consequences upon the vesting and/or settlement of the RSUs and/or acquisition or disposition of the Shares, if any, received in connection therewith, and you should consult a tax adviser regarding your tax obligations prior to such settlement or disposition.

9.Compliance with Laws and Regulations. The grant of your RSU and the issuance of any Shares thereunder shall be subject to compliance with all applicable requirements of federal, state or foreign law with respect to such securities. You may not be issued any Shares if such issuance would constitute a violation of any applicable federal, state or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition, you may not be issued any Shares unless (i) a registration statement under the Securities Act shall at the time of issuance be in effect with respect to the shares or (ii) in the opinion of legal counsel to the Company, the Shares may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company's legal counsel to be necessary to the lawful issuance and sale of any Shares shall relieve the Company of any liability in respect of the failure to issue or sell such shares as to which such requisite authority shall not have been obtained. As a condition to the issuance of any Shares pursuant to this RSU, the Company may require you to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company. YOU ARE CAUTIONED THAT THE SHARES MAY NOT BE ISSUED UNLESS THE FOREGOING CONDITIONS ARE SATISFIED.

10.Restrictive Legends. The Shares issued pursuant to this Agreement shall be endorsed with appropriate legends, if any, determined by the Company.

11.No Rights as Employee, [Director] or Consultant. Except to the extent otherwise provided under applicable law or individual written agreement between you and your employer, nothing in this Agreement shall affect in any manner whatsoever the right or power of the Company, or a Parent or Subsidiary of the Company, to terminate your Service, for any reason, with or without cause.

12.Unsecured Obligation. The award of RSUs is unfunded, and even as to any RSUs that vest, you shall be considered an unsecured creditor of the Company with respect to the Company's obligation, if any, to issue Shares pursuant to this Agreement. You shall not have voting or any other rights as a stockholder of the Company with respect to the Shares acquired pursuant to this Agreement unless and until such Shares are issued to you. Upon such issuance, you will obtain full voting and other rights as a stockholder of the Company with respect to the Shares so issued.

13.Delivery of Documents and Notices. Any document relating to participating in the Plan and/or notice required or permitted hereunder shall be given in writing and shall be deemed effectively given (except to the extent that this Agreement provides for effectiveness only upon actual receipt of such notice) upon personal delivery, electronic delivery, or upon deposit with a well established commercial overnight service or with the U.S. Post Office or foreign postal service by registered or certified mail, with postage and fees prepaid, addressed to the other party at the e-mail address, if any, provided for you by the Company or at such other address as such party may designate in writing from time to time to the other party.

14.Consent to Electronic Delivery. The Plan, Plan prospectus, Notice of Grant, RSU Agreement and U.S. financial reports of the Company, may be delivered to you electronically. Such means of delivery may include but do not necessarily include the delivery of a link to a Company intranet or the internet site of a third party involved in administering the Plan, the delivery of the document via e-mail or such other delivery determined at the Committee's discretion. You consent to the electronic delivery of the Plan and related documents, as described in this Section 14. You acknowledge that you may receive from the Company a paper copy of any documents delivered electronically at no cost if you contact the Company by telephone, through a postal service or electronic mail at [____________@versant.com]. You further acknowledge that you will be provided with a paper copy of any documents delivered electronically if electronic delivery fails; similarly, you understand that you must provide the Company or any designated third party with a paper copy of any documents delivered electronically if electronic delivery fails. Also, you understand that your consent may be revoked or changed, including any change in the electronic mail address to which documents are delivered (if you have provided an electronic mail address), at any time by notifying the Company of such revised or revoked consent by telephone, postal service or electronic mail at [____________@versant.com]. Finally, you understand that you are not required to consent to electronic delivery.

15.Applicable Law. This Agreement shall be governed by the laws of the State of California as such laws are applied to agreements between California residents entered into and to be performed entirely within the State of California, without regarding to principles of choice of law or conflict of laws.

16.Successors and Assigns. The Company may assign any of its rights under this Agreement.

This Agreement shall be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon you and your heirs, executors, administrators, legal representatives, successors and assigns.

17.Entire Agreement; Severability. The Plan and Notice of Grant are incorporated herein by reference. The Plan, the Notice of Grant and this Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and you with respect to the subject matter hereof. If any provision of this Agreement is determined by a court of law to be illegal or unenforceable, then such provision will be enforced to the maximum extent possible and the other provisions will remain fully effective and enforceable.

* * * * *

XML

Goodwill and Intangible Assets

3 Months Ended

Jan. 31, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets Disclosure [Text Block]

Goodwill and Intangible Assets

Goodwill

The following table presents the Company’s goodwill balance as of January 31, 2012 and October 31, 2011 (in thousands):

	Net Carrying Amount
Goodwill:
Versant Europe	$	241
Poet Holdings, Inc.	5,752
FastObjects, Inc.	677
JDO Genie (PTY), Ltd	50
db4o	1,869
Total	$	8,589

Goodwill is subject to at least an annual assessment for impairment, applying a fair-value based test. Versant conducted its annual impairment test in October 2011 and determined there was no impairment. No events or circumstances occurred during the three months ended January 31, 2012 that would more likely than not reduce the fair value of the Company below its carrying amount.

Intangible Assets

The Company’s intangible asset balances as of January 31, 2012 and October 31, 2011 are as follows (in thousands):

	January 31, 2012						October 31, 2011
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Intangible assets:
db4o-Developed Technology (Amortized over 5 years)	$	300	$	190	$	110	$	300	$	175	$	125
db4o-Customer Relationships (Amortized over 9 years)	210		74		136		210		68		142
db4o-Trade Name (Amortized over 5 years)	100		63		37		100		58		42
Total	$	610	$	327	$	283	$	610	$	301	$	309

Aggregate amortization expense for intangible assets was $26,000 for the three months ended January 31, 2012, and $73,000 for the three months ended January 31, 2011.

The projected amortization of the Company’s existing intangible assets as of January 31, 2012 is as follows (in thousands):

	Amortization
Nine months ending October 31, 2012	$	78
Fiscal year ending October 31,
2013	103
2014	30
2015	23
2016	23
Thereafter	26
Total	$	283

XML

Valuation and Qualifying Accounts and Reserves

3 Months Ended

Jan. 31, 2012

Valuation and Qualifying Accounts and Reserves [Abstract]

Schedule of Valuation and Qualifying Accounts Disclosure [Text Block]

Valuation and Qualifying Accounts and Reserves

Versant evaluates and revises its allowance for doubtful accounts receivable as part of its quarter end process at the subsidiary and corporate level. The Company’s management assigns a risk factor and percentage of risk to each account receivable, the collection of which is considered non-routine. Accounts are considered past due in accordance with contractual terms which usually provide for payment within 30 to 90 days. The Company also assigns a general reserve to all its overdue accounts, excluding the non-routine items.

The following table summarizes the activities in the Company’s allowance for doubtful accounts:

	Three Months Ended			Fiscal Year Ended
	January 31, 2012			October 31, 2011
	(in thousands)
Allowance for doubtful accounts:
Beginning balance	$	16		$	8
Adjustments to provision	(4		)	8
Ending balance	$	12		$	16

The following table summarizes trade accounts receivable balances in excess of 10% of the Company's total trade accounts receivable as of January 31, 2012 and October 31, 2011 (in thousands): 

	As of January 31, 2012			As of October 31, 2011
Customer A		$	1,116		$	362
Customer B		459			*
Customer C		*			311
Customer D		*			225
* not in excess of 10% of trade accounts receivable

XML

Condensed Consolidated Balance Sheets (unaudited) (USD $) In Thousands, unless otherwise specified	Jan. 31, 2012	Oct. 31, 2011
Current assets:
Cash and cash equivalents	$ 23,017	$ 23,145
Trade accounts receivable, net	3,974	2,183
Deferred income taxes	834	898
Other current assets	392	481
Total current assets	28,217	26,707
Property and equipment, net	923	993
Goodwill	8,589	8,589
Intangible assets, net	283	309
Other assets	38	38
Total assets	38,050	36,636
Current liabilities:
Accounts payable	239	152
Accrued liabilities	1,489	1,076
Deferred revenues	3,670	2,695
Total current liabilities	5,398	3,923
Other long-term liabilities	151	178
Total liabilities	5,549	4,101
Commitments and contingencies
Shareholders' equity
Common Stock, no par value, 7,500,000 shares authorized, 2,926,474 shares issued and outstanding at January 31, 2012 and 2,935,125 shares issued and outstanding at October 31, 2011	90,152	90,055
Accumulated other comprehensive income (loss), net	(233)	31
Accumulated deficit	(57,418)	(57,551)
Total shareholders’ equity	32,501	32,535
Total liabilities and shareholders’ equity	$ 38,050	$ 36,636

XML

Basis of Presentation and Recent Accounting Pronouncements

3 Months Ended

Jan. 31, 2012

Basis of Presentation and Recent Accounting Pronouncements [Abstract]

Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block]

Basis of Presentation and Recent Accounting Pronouncements

Basis of Presentation

Versant Corporation (with its subsidiaries, collectively referred to in this report as “Versant” or “the Company”) was incorporated in California in August 1988. The unaudited condensed consolidated financial statements contained in this report on Form 10-Q include all of the assets, liabilities, revenues, expenses and cash flows of Versant and all entities in which Versant has a controlling interest (subsidiaries) required to be consolidated in accordance with U.S. generally accepted accounting principles. Inter-company accounts and transactions between consolidated companies have been eliminated in consolidation.

The financial statements included herein reflect all adjustments which, in the opinion of the Company, are necessary for a fair presentation of the results for the interim periods presented. All such adjustments are normal recurring adjustments. These financial statements have been prepared in accordance with generally accepted accounting principles related to interim financial statements and the applicable rules of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for annual financial statements.

The financial statements and related disclosures have been prepared with the presumption that users of the interim financial information have read or have access to the audited financial statements for the Company’s preceding fiscal year ended October 31, 2011. Accordingly, these financial statements should be read in conjunction with those audited financial statements and the related notes thereto contained in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2011, filed on January 30, 2012 (File/Film No. 000-28540/12556329) as amended by the Form 10-K/A filed on February 28, 2012 (File/Film No. 000-28540/12648015). The Company’s operating results for the three months ended January 31, 2012 are not necessarily indicative of the results that may be expected for any other interim period, for the full fiscal year ending October 31, 2012, or for any future periods. Further, the preparation of condensed consolidated financial statements requires management to make estimates and assumptions that affect the recorded amounts reported therein. A change in facts or circumstances relating to the estimates could result in a change to the estimates and could impact future operating results.

Recently Adopted Accounting Pronouncements

Fair Value Measurement Disclosure

In January 2010, the Financial Accounting Standards Board ("FASB") amended the disclosure requirements for the fair value measurements for recurring and nonrecurring non-financial assets and liabilities. The guidance requires new disclosures about transfers into and out of Levels 1 and 2 and separate disclosures about purchases, sales, issuances, and settlements relating to Level 3 measurements. It also clarifies existing fair value disclosures about the level of disaggregation and about inputs and valuation techniques used to measure fair value. The new disclosures and clarifications of existing disclosures were effective for the Company’s second quarter of fiscal year 2010, except for the disclosures about purchases, sales, issuances, and settlements relating to Level 3 measurements, which are effective for the Company’s first quarter of fiscal year 2012. The adoption of this guidance had no material impact on the Company’s consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

Goodwill Impairment Testing

In December 2010, the FASB issued guidance which amends ASC 350, Intangibles - Goodwill and Other. This Accounting Standards Update amends the criteria for performing Step 2 of the goodwill impairment test for reporting units with zero or negative carrying amounts and requires performing Step 2 if qualitative factors indicate that it is more likely than not that a goodwill impairment exists. This guidance is effective for fiscal years beginning after December 15, 2011 (November 1, 2012 for the Company). The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

Presentation of Comprehensive Income

In June 2011, the FASB issued ASU No. 2011-05, Presentation of Comprehensive Income. The issuance of ASU 2011-05 is intended to improve the comparability, consistency and transparency of financial reporting and to increase the prominence of items reported in other comprehensive income. The guidance in ASU 2011-05 supersedes the presentation options in ASC Topic 220 and facilitates convergence of U.S. generally accepted accounting principles and International Financial Reporting Standards by eliminating the option to present components of other comprehensive income as part of the statement of changes in stockholders' equity and requiring that all non-owner changes in stockholders' equity be presented either in a single continuous statement of comprehensive income or in two separate but consecutive statements. This guidance will be appliedretrospectively and early adoption is permitted. This guidance is effective for fiscal years and interim periods within those years, beginning after December 15, 2011 (November 1, 2012 for the Company). The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

Goodwill Impairment Testing

In September 2011, the FASB issued guidance to amend and simplify the rules related to testing goodwill for impairment. The revised guidance allows an entity to make an initial qualitative evaluation, based on the entity’s events and circumstances, to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. The results of this qualitative assessment determine whether it is necessary to perform the currently required two-step impairment test. The new guidance is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011 (November 1, 2012 for the Company). Early adoption is permitted. The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

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Fair Value Measurements

3 Months Ended

Jan. 31, 2012

Fair Value Measurements [Abstract]

Fair Value Measurements

Fair Value Measurements

Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures, defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market for the transaction and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.

The FASB guidance also establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of inputs that may be used to measure fair value are as follows:

• Level 1: quoted prices in active markets for identical assets or liabilities;

• Level 2: inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not

active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; or

• Level 3: unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Financial Assets Measured at Fair Value on a Recurring Basis

Our significant financial assets measured at fair value on a recurring basis consisted of the following types of instruments as of January 31, 2012 (Level 1, 2 and 3 inputs are defined above):

	Fair Value Hierarchy	As of January 31, 2012
		(in thousands)
Financial assets:
Money market funds	Level 1		$	13,202
Time deposits	Level 1		8,204
Total			$	21,406
The fair value of money market funds and time deposits reflect quoted market prices in an active market.

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Condensed Consolidated Balance Sheets Parenthetical (unaudited)	Jan. 31, 2012	Oct. 31, 2011
Common stock, authorized	7,500,000	7,500,000
Common stock, issued	2,926,474	2,935,125
Common stock, outstanding	2,926,474	2,935,125

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Other Comprehensive Income (loss), net

3 Months Ended

Jan. 31, 2012

Other Comprehensive Income [Abstract]

Comprehensive Income (Loss) Note [Text Block]

Other Comprehensive Income (Loss)

Accumulated other comprehensive income presented in the accompanying condensed consolidated balance sheets consists of cumulative foreign currency translation adjustments.

Comprehensive income (loss) for the three month periods ended January 31, 2012 and 2011 was as follows (in thousands):
	Three Months Ended
	January 31,			January 31,
	2012			2011
Net income, as reported	$	133		$	461
Foreign currency translation adjustment	(264		)	(75		)
Comprehensive income (loss)	$	(131	)	$	386

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Document and Entity Information (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended
	Jan. 31, 2012	Mar. 14, 2012	Apr. 30, 2011
Entity Information [Line Items]
Entity Registrant Name	Versant Corporation
Entity Central Index Key	0000865917
Current Fiscal Year End Date	--10-31
Entity Filer Category	Smaller Reporting Company
Document Type	10-Q
Document Period End Date	Jan. 31, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Common Stock, Shares Outstanding		2,862,587
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Public Float			$ 39,903

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Segment and Geographic Information

3 Months Ended

Jan. 31, 2012

Segment and Geographic Information [Abstract]

Segment Reporting Disclosure [Text Block]

Segment and Geographic Information

ASC 280, Segment Reporting establishes standards for the manner in which public companies report information about operating segments in annual and interim financial statements which require the reporting of segment information using the “management approach.” Under this approach, operating segments are identified in substantially the same manner as they are reported internally and used by the Company’s chief operating decision maker (“CODM”) for purposes of evaluating performance and allocating resources. Based on this approach, the Company has determined that it operates in a single operating segment, Data Management.

One telecommunications customer accounted for approximately 13% of our total revenues in the three months ended January 31, 2012 and the related accounts receivable balance for this customer was approximately $1.1 million as of January 31, 2012.

One healthcare customer accounted for approximately 10% of total revenues in the three months ended January 31, 2011 and the related accounts receivable balance for this customer was approximately $445,000 as of January 31, 2011.

The Company operates in North America, Europe and Asia. In general, revenues are attributed to the country in which the revenue-bearing contract originates.

The following table reflects revenues for the three months ended January 31, 2012 and 2011 by each geographic region (in thousands): 

	Three Months Ended
	January 31,		January 31,
	2012		2011
Revenues by region:
North America	$	1,028	$	1,713
Europe	3,179		2,725
Asia	136		139
	$	4,343	$	4,577

The following table reflects long-lived assets as of January 31, 2012 and October 31, 2011 in each geographic region (in thousands): 

	January 31, 2012		October 31, 2011
Total long-lived assets by region:
North America	$	457	$	438
Germany	500		588
Asia	4		5
	$	961	$	1,031

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Condensed Consolidated Statements of Income (unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Jan. 31, 2012	Jan. 31, 2011
Revenues:
License	$ 2,654	$ 2,596
Maintenance	1,653	1,919
Professional services	36	62
Total revenues	4,343	4,577
Cost of revenues:
License	69	68
Amortization of intangible assets	26	73
Maintenance	354	373
Professional services	20	21
Total cost of revenues	469	535
Gross profit	3,874	4,042
Operating expenses:
Sales and marketing	1,453	1,500
Research and development	1,119	932
General and administrative	1,010	1,045
Total operating expenses	3,582	3,477
Income from operations	292	565
Interest and other income, net	27	9
Income before provision for income taxes	319	574
Provision for income taxes	186	113
Net income	$ 133	$ 461
Net income per share:
Basic	$ 0.05	$ 0.14
Diluted	$ 0.05	$ 0.14
Shares used in per share calculation:
Basic	2,935	3,203
Diluted	2,946	3,320

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Common Stock Repurchases

3 Months Ended

Jan. 31, 2012

Common Stock Repurchases [Abstract]

Stockholders' Equity Note Disclosure [Text Block]

Common Stock Repurchases

Fiscal Year 2012 Stock Repurchase Program

On November 28, 2011 Versant’s Board of Directors approved a new stock repurchase program announced on December 1, 2011 pursuant to which Versant is authorized to repurchase up to $5.0 million of its common stock in fiscal year 2012. This stock repurchase program is currently scheduled to expire upon the earlier of October 31, 2012, or at such time as Versant has expended $5.0 million to repurchase outstanding common shares under the program; however the program may be suspended, discontinued or extended at any earlier time by the Company.

From the date of announcement of this stock repurchase program through January 31, 2012, Versant acquired under this program a total of 18,412 common shares on the open market for approximately $0.2 million at an average purchase price of $9.44 per share, leaving approximately $4.8 million in authorized funds available for future repurchases of stock under this program. Thereafter, during the period beginning February 1, 2012 and ending March 14, 2012, Versant acquired an additional 68,987 common shares on the open market and in block trades for approximately $756,000 at an average purchase price of $10.96 per share, leaving approximately $4.1 million in authorized funds available for future repurchases of stock under this program as of March 14, 2012.

Fiscal year 2011 Stock Repurchase Program.

On November 29, 2010 Versant’s Board of Directors approved a stock repurchase program authorizing Versant to repurchase up to $5.0 million of its outstanding common shares on the open market, in block trades or otherwise. This stock repurchase program expired by its terms on October 31, 2011. Pursuant to this program, Versant acquired 240,629 common shares on the open market for approximately $3.0 million at an average purchase price of $12.23 per share.

Other Stock Repurchase

On March 10, 2011, Versant and the Company’s then Chief Executive Officer ("Former CEO") entered into a separation agreement (the “Separation Agreement”). On March 28, 2011, pursuant to the Separation Agreement, Versant repurchased 62,545 shares of Versant common stock owned by the Former CEO at a price of $13.50 per share, which reflected recent market trading prices of Versant’s common stock as of the date of the Separation Agreement.

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Per Share Data

3 Months Ended

Jan. 31, 2012

Per Share Data [Abstract]

Earnings Per Share [Text Block]

Per Share Data

Basic and diluted net income per common share has been computed using the weighted average number of shares of common stock outstanding during the period, less shares subject to repurchase. The following table presents the calculation of basic and diluted net income per share (in thousands, except per share amounts):

	Three Months Ended
	January 31, 2012		January 31, 2011
Net income	$	133	$	461
Calculation of basic net income per share:
Weighted average - common shares outstanding	2,935		3,203
Net income per share, basic	$	0.05	$	0.14
Calculation of diluted net income per share:
Weighted average - common shares outstanding	2,935		3,203
Dilutive effect of employee and director stock options	11		117
Weighted average - common shares outstanding and potentially dilutive common shares	2,946		3,320
Net income per share, diluted	$	0.05	$	0.14

For the three months ended January 31, 2012 and 2011, 616,000 and 401,000 potentially dilutive shares, respectively, were excluded from the computation of diluted net income per share by the application of the treasury stock method.

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Restructuring

3 Months Ended

Jan. 31, 2012

Restructuring [Abstract]

Restructuring and Related Activities Disclosure [Text Block]

Restructuring

In the fourth quarter of fiscal year 2009, the Company committed to the implementation of a restructuring plan pursuant to which it closed its research and development facility in Pune, India and is winding down the affairs of its subsidiary, Versant India Private Limited (“Versant India”). The restructuring plan was undertaken to consolidate the Company’s research and development efforts into one location in Germany in order to streamline operations, create management efficiencies and increase productivity. Since the plan was undertaken, Versant has incurred restructuring costs of $203,000 as of January 31, 2012. The restructuring was substantially completed during the second quarter ended April 30, 2010. No restructuring costs were incurred in the three months ended January 31, 2012 and 2011.

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Employee and Director Benefit Plans

3 Months Ended

Jan. 31, 2012

Employee and Director Benefit Plans [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

Employee and Director Benefit Plans

The Company grants common stock options under its 2005 Equity Incentive Plan and its 2005 Directors' Stock Option Plan and issues stock under its 2005 Employee Stock Purchase Plan, which plans have been approved by Versant's shareholders.

Shares Reserved for Future Issuance

At the Company's 2011 annual shareholder meeting, held on April 18, 2011, the shareholders approved an increase of 300,000 shares and 20,000 shares in the numbers of shares reserved under the Company's 2005 Equity Incentive Plan and 2005 Directors' Stock Option Plan, respectively.

As of January 31, 2012, the Company had reserved shares of common stock for the following purposes (in thousands):

Reserved for issuance:
Employee stock purchase plan	23
Shares available for grant	316
Unexercised stock options	674
Balance as of January 31, 2012	1,013

The following table summarizes stock option activities under the Company’s equity-based compensation plans during the three months ended January 31, 2012 and 2011:

	Three Months Ended January 31,
	2012				2011
	Shares in thousands		Weighted average exercise price		Shares in thousands		Weighted average exercise price
Stock option activity:
Outstanding at the beginning of the period	651		$	15.20	515		$	16.84
Granted	33		10.86		142		11.81
Exercised	(2	)	4.60		—		—
Forfeited and expired	(8	)	13.18		(5	)	77.31
Outstanding at the end of the period	674		$	15.04	652		$	15.28
Options exercisable at the end of the period	538		$	15.51	393		$	16.05

Under the 2005 Employee Stock Purchase Plan, employees may generally defer up to 10% of their compensation to purchase shares of our common stock at a purchase price equal to 85% of the lower of the fair market value per share of our common stock on (i) the commencement date of the applicable six month offering period or (ii) the applicable purchase date. During the three months ended January 31, 2012, 7,699 shares were issued under the Employee Stock Purchase Plan. Approximately 23,000 shares remained available for future issuance as of January 31, 2012.

On February 21, 2011, the Board of Directors of the Company approved an amendment to the 2005 Equity Incentive Plan to allow the grant of restricted stock units and approved the grant to employees of 29,000 common stock options and 43,950 restricted stock units which began vesting on November 1, 2011 and December 1, 2011, respectively. The Company generally considers employee equity compensation on an annual basis after the close of the fiscal year.

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Share Based Compensation

3 Months Ended

Jan. 31, 2012

Share-based Compensation [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

Share Based Compensation

Share based compensation cost is estimated at the grant date based on the fair value of the award and is recognized as expense over the requisite service period of the award. The fair value of each option granted is estimated on the date of grant and the fair value of each share issued under Versant’s Employee Stock Purchase Plan (or “ESPP”) is estimated at the beginning of the purchase period, using the Black-Scholes Option Pricing Model, based on the following assumptions:

	Stock Options		ESPP
	Three Months Ended January 31,		Three Months Ended January 31,
	2012	2011	2012	2011
Assumptions:
Volatility	45% - 50%	48%	31% - 37%	30% - 31%
Expected life	4.25 - 5.75 years	3.8 years	6 - 12 months	6 - 12 months
Weighted average risk-free interest rate	0.65% - 1.03%	1.43%	0.06% - 0.12%	0.20% - 0.28%
Dividend yield	—	—	—	—

Share based compensation expense recognized in the condensed consolidated statements of income related to the Company’s equity incentive plans and stock purchase plan was as follows (in thousands):
	Three Months Ended
	January 31,		January 31,
	2012		2011
Share based compensation expense:
Equity Incentive Plans	$	230	$	213
ESPP	5		11
Total	$	235	$	224

Share based compensation recognized in the condensed consolidated statements of income, by income statement caption, was as follows (in thousands):
	Three Months Ended
	January 31,		January 31,
	2012		2011
Share based compensation expense:
Cost of revenues	$	16	$	16
Sales and marketing	72		65
Research and development	52		49
General and administrative	95		94
Total	$	235	$	224

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Income Taxes

3 Months Ended

Jan. 31, 2012

Income Taxes [Abstract]

Income Tax Disclosure [Text Block]

Income Taxes

The Company accounts for income taxes pursuant to the provisions of ASC 740, Income Taxes, which requires an asset and liability approach to accounting for income taxes. Deferred tax assets and liabilities are determined based on the difference between the financial statement carrying amounts and the tax basis of assets and liabilities and are measured using the enacted statutory tax rates in effect at the balance sheet date. The Company records a valuation allowance to reduce its deferred tax assets when uncertainty exists regarding the realizability of the deferred tax assets. The Company had net deferred tax assets of $834,000 and $898,000 as of January 31, 2012 and October 31, 2011, respectively.

The Company has significant deferred tax assets arising primarily from net operating loss ("NOL") carry forwards in the U.S., California and in Germany. Ultimately, the realization of the deferred tax assets is dependent upon the Company’s generation of sufficient future taxable income to enable it to use net operating loss and tax credit carry forwards during those periods in which such carry forwards can be utilized by the Company. In evaluating Versant’s ability to utilize its deferred tax assets, management of the Company considers all available positive and negative evidence, including past operating results in the most recent fiscal years and an assessment of expected future results of operations on a jurisdiction by jurisdiction basis.

The Company has experienced substantial past tax losses in its U.S. operations. Due to the lack of forecast future taxable income and the relative size of the Company’s Federal and California net operating loss carry forwards, considerable uncertainty exists that the Company will realize these deferred tax assets. Based on this objective evidence, a full valuation allowance has been recorded against the Company’s deferred tax assets related to its U.S. operations.

The Company has also experienced substantial past tax losses in its European operations. In its most recent fiscal years, the Company has generated taxable income and begun to utilize its deferred tax assets related to its German net operating loss carry forwards. Management of the Company has forecast taxable income for its European operations in fiscal year 2012. The global economic downturn has negatively impacted the Company’s operating results in all regions.  The Company has experienced declining revenues as economic conditions have remained difficult. Given the uncertainty of the macroeconomic environment, future revenues and operating results are difficult to forecast. Therefore, management has concluded it is more likely than not that the Company will realize the benefit of its deferred tax assets related to its German net operating loss carry forwards only to the extent of its expected taxable income in fiscal year 2012.

Significant management judgment is required to determine when, in the future, it will become more likely than not that additional net deferred tax assets will be realized. Management will continue to assess the realizability of the tax benefit available based on actual and forecast operating results. Management does not anticipate significant changes to its uncertain tax positions through October 31, 2012.

 The provision for income tax expense consisted of the following (in thousands):

	Three Months Ended
	January 31,		January 31,
	2012		2011
Provision for income taxes:
Federal and state	$	4	$	—
Foreign - Europe	115		110
Foreign - India	67		—
Foreign withholding	—		3
Total current	186		113

The provision for income tax expense differs from the amount estimated by applying the statutory federal income tax rate to income before taxes, primarily due to foreign income taxed at other than U.S. rates, foreign withholding taxes and state taxes.

The Company is subject to U.S. federal income taxes and to income taxes in various states in the U.S. as well as in foreign jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or foreign tax examinations by tax authorities for tax years before 2005. However, with respect to tax years no longer subject to examination due to expiration of the statute of limitations, income may nevertheless be recomputed for the purpose of determining the amount of NOL that may be carried over to “open” years.

In conjunction with the wind-down of the Company's operations in India, an income tax inspection was conducted. Additional taxes and penalties of approximately $67,000 were imposed as a result of this inspection, which have been included in our income tax provision.

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Condensed Consolidated Statements of Cash Flows (unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Jan. 31, 2012	Jan. 31, 2011
Cash flows from operating activities:
Net income	$ 133	$ 461
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	113	75
Amortization of intangible assets	26	73
Share based compensation	235	224
Changes in assets and liabilities:
Trade accounts receivable	(1,845)	(784)
Other assets	68	(16)
Accounts payable	90	206
Accrued liabilities and other long-term liabilities	396	111
Deferred revenues	1,027	631
Net cash provided by operating activities	243	981
Cash flows from investing activities:
Purchases of property and equipment	(86)	(215)
Net cash used in investing activities	(86)	(215)
Cash flows from financing activities:
Proceeds from issuance of common stock	81	72
Repurchases of common stock	(175)	(404)
Net cash used in financing activities	(94)	(332)
Effect of foreign exchange rate changes on cash and cash equivalents	(191)	(49)
Net increase (decrease) in cash and cash equivalents	(128)	385
Cash and cash equivalents at beginning of period	23,145	24,911
Cash and cash equivalents at end of period	23,017	25,296
Supplemental disclosures of cash flows information: Cash paid for:
Income taxes	$ (85)	$ 105

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Commitments and Contingencies

3 Months Ended

Jan. 31, 2012

Commitments and Contingencies [Abstract]

Commitments and Contingencies Disclosure [Text Block]

Commitments and Contingencies

Lease commitments

Versant’s principal commitments as of January 31, 2012 consist of obligations under operating leases for facilities and equipment.

Versant leases office space for its U.S. headquarters in Redwood City, California and also leases field office space in Cupertino, California and Hamburg and Munich, Germany under operating lease agreements. The Company's operating lease arrangements as of January 31, 2012 are summarized below:

Leased Office Facility:	Lease Expiration Date	Total Rent Payable over the Remaining Lease Term		Options to Renew at Fair Value
Hamburg, Germany	11/30/2014	$	476,000	Two three year renewal options
Redwood City, California	5/31/2013	$	273,000	Two one year renewal options
Munich, Germany	2/28/2014	$	54,000	Single two year renewal option
Redwood City, California	5/31/2014	$	236,000	Single one year renewal option
Cupertino, California	1/15/2013	$	39,000	none

Our minimum commitments under non-cancelable operating leases that have an initial or remaining lease term in excess of one year as of January 31, 2012 are as follows (in thousands): 

	Facilities Leases		Equipment Leases		Total
Nine months ending October 31, 2012	$	372	$	4	$	376
Fiscal year ending October 31,
2013	417		2		419
2014	236				236
2015	14				14
2016	—				—
Total	$	1,039	$	6	$	1,045

Total rent expense for all operating leases was $114,000 and $96,000 for the three months ended January 31, 2012 and 2011, respectively.

Contingencies

The Company is subject to various legal proceedings and disputes that arise in the ordinary course of business from time to time. There were no ongoing material legal proceedings as of January 31, 2012.

The Company enters into indemnification agreements in the ordinary course of business. The Company's license agreements with customers generally require it to indemnify the customer against claims that its software infringes third party patent, copyright, trademark or other proprietary rights. Such indemnification obligations are generally limited in a variety of industry-standard respects. If a liability associated with any of the Company's indemnifications becomes probable and the amount of the liability is reasonably estimable or the minimum amount of a range of loss is reasonably estimable, then an appropriate liability will be established. The estimated fair value of these indemnification clauses is minimal.