San Jose, Calif., March 29, 2006 – Selectica, Inc. (NASDAQ: SLTC), a leading provider of sales execution and contract management applications, and ISH, Inc., a leading provider of professional operational and financial improvement services for the healthcare industry, today announced a strategic partnership that offers the healthcare industry’s first solution for converting under-managed contract information and processes into strategic corporate assets. Together, the companies will harness the power of Selectica’s industry-leading on-demand contract management offering with the healthcare industry expertise and presence of ISH to offer a combined solution that provides unmatched visibility and control of contractual agreements. The partnership will enable users to stop revenue leaks, control spending, enforce compliance and limit risk exposure.

In the wake of rising healthcare costs, providers are searching for ways to improve their operational efficiency and meet the ever-changing landscape of compliance issues so they can focus greater attention on patient care. Selectica and ISH address this need by offering a powerful contract management solution that is quick and easy to deploy; offers an automated, self-service approach; and, is based on open standards so that healthcare providers can reap immediate results across their entire network and realize a fast return on investment. The benefits of contract management automation are significant. According to recent Aberdeen Group benchmark studies, participants are consistently rating contract management among the top business application investments for the coming year with an expected growth rate of 27 percent.

“The need for a highly automated contract management solution has become more critical as hospitals look for ways to optimize contract performance and compliance across the complex network of vendors, insurance providers, and government,” said James Dias, vice president of marketing and sales at Selectica. “This partnership represents a true collaboration between two industry leaders who recognize the unique challenges healthcare organizations face. Selectica is pleased to partner with ISH, one of the most experienced and successful healthcare professional services companies in the industry.”

Selectica’s proven contract management software, coupled with ISH’s experience in creating focused IT-Enabled Business Strategy Implementation Programs, will result in an offering designed exclusively for the healthcare industry. The software and services will address the increasing compliance regulations mandated by federal law, such as Stark I and II, which has left many hospitals scrambling to manage thousands of individual physician’s agreements.

“The issue of contract management may not receive the limelight of other more mainstream IT applications, but for healthcare organizations that must now manage thousands of contracts that meet new, strict federal regulations, the problem can no longer be solved through slow, inaccurate and expensive manual processes,” said John Marchisin, executive vice president of ISH. “Through this partnership with Selectica, we can offer customers an IT-Enabled Implementation Program that efficiently and effectively automates the contract management process and delivers increased operational performance and competitive value to the organization.”

Now with Selectica and ISH, hospitals and healthcare organizations can easily gain superior insight into all of their contracts and proactively take steps to ensure compliance with federal regulations. Selectica and ISH automate the entire contract lifecycle, including tracking key milestones, enforcing the use of standard processes and terms and eliminating expired, redundant and poorly structured agreements. Healthcare providers can be up and running in a matter of days through Selectica’s hosted on-demand software offering that removes IT infrastructure hassles and provides a low cost of ownership.

The joint offering is available immediately. Contact James Dias, Selectica, Vice President Marketing and Sales at 408.570.9700 or John Marchisin, ISH EVP at 732.571.5937 for more details and information.

About ISH
Since 1989 ISH has been a leading provider of strategic, operational and IT business planning and implementation professional services for Healthcare. ISH has developed an excellent reputation for improving their client’s financial, operational and clinical performance through the implementation of software, new processes and better business and clinical practices. Their focus on performance indicators and measurable outcomes adds value to their clients and provides them with a distinct competitive advantage through more efficient operations and improved decision-making capabilities. In turn, this leads to cost savings, process efficiencies, and closer relationships with customers, associates, and suppliers.

About Selectica, Inc.
Founded in 1996, Selectica (NASDAQ: SLTC) provides its customers with smart technology that accelerates profitability by automating complex business processes in the areas of sales execution and contract lifecycle management. Available on-demand or as a fully customized installed software application, the company’s high-performance solutions provide a critical link between CRM and ERP to accelerate sales configuration, eliminate order inaccuracies, ensure compliance and limit risk exposure.
 
Selectica customers represent leaders in manufacturing, technology, healthcare and telecommunications, including: ABB, Alcoa, Applied Bio Systems, Bell Canada, Cisco, Dell, General Electric, Fireman's Fund Insurance Company, Hitachi, International Paper, Juniper Networks, Rockwell Automation, Seton Hospital, Tellabs, Time Warner, Triad Hospitals and 7-Eleven. Selectica is headquartered in San Jose, CA. For more information, visit the company’s Web site at www.selectica.com.

Forward Looking Statements
The statements contained in this release that are not purely historical are forward-looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934, including statements regarding Selectica's and its customers' expectations, beliefs, hopes, intentions or strategies regarding the future and expectations regarding performance improvements or increases in sales attributable to Selectica's existing and new products. All forward-looking statements included in this document are based upon information available to Selectica as of the date hereof, and Selectica assumes no obligation to update any such forward-looking statement. Actual results could differ materially from current expectations. Factors that could cause or contribute to such differences include, but are not limited to, market and customer acceptance of new products of Selectica including Fastraq, the recently acquired contract management products and the applications developed with joint venture partners, the success of the ongoing restructuring of Selectica’s operations, and other factors and risks discussed in Selectica's Annual Report on Form 10-K for the fiscal year ended March 31, 2005 and in other reports filed by Selectica with the Securities and Exchange Commission.