TenFold announced that it has signed a Merger Agreement to be acquired by Versata Enterprises.

Under the terms of the agreement, TenFold stockholders will receive $0.04 in cash for each share of TenFold common stock, and convertible preferred stock on an as-converted basis.

In connection with the Merger Agreement, TenFold has executed a $300,000 promissory note in favor of Versata. The promissory note bears interest at 10% per annum and is due on the earlier to occur of September 21, 2008 or the termination of the Merger Agreement. Repayment of the promissory note is secured by TenFold’s equipment and accounts receivable pursuant to a security agreement executed concurrently with the promissory note.

The proposed transaction has been approved by TenFold’s board of directors. In addition, the holders of a majority of TenFold’s preferred stock have waived, on behalf of the entire class, the liquidation preference otherwise payable in respect of the preferred stock. The transaction is expected to be completed in the second quarter of 2008, subject to various conditions, including approval by TenFold’s stockholders and other customary closing conditions. A special meeting of TenFold’s stockholders will be scheduled as soon as practicable following the preparation and filing of proxy materials with the Securities and Exchange Commission.

“By merging with Versata, we believe that TenFold will benefit from the leverage offered by a larger parent company similarly focused on delivering business value to customers through robust, agile applications,” said Robert Felton, TenFold’s Chairman, President, and CEO. “We expect this merger to enable TenFold to provide our customers with a broader set of product and services offerings, as well as continue to focus on the significant business benefits of the TenFold technology.”

“TenFold’s history of providing its customers and partners with significant savings in development and maintenance complements Versata’s strategy of lowering customers’ total cost of ownership with solutions to accelerate development, reduce ongoing maintenance, and drive business impact,” said Randy Jacops, CEO of Versata Enterprises. “Our customer success program compels us to align investments and priorities with our customers, a unique focus in the software industry intended to drive benefit to TenFold’s customers. We are excited by TenFold’s long-term customer relationships and look forward to welcoming them to our customer success program.”