Exhibit 10.1

 

AMENDMENT NO. 5

TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

 

THIS AMENDMENT NO. 5 TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this
“Amendment”) is entered into this 10 day of November, 2005, by and between SABA
SOFTWARE, INC., a Delaware corporation (“Borrower”), and SILICON VALLEY BANK
(“Bank”). Capitalized terms used herein without definition shall have the same
meanings given them in the Loan Agreement (as defined below).

 

RECITALS

 

A. Borrower and Bank have entered into that certain Amended and Restated Loan
and Security Agreement dated as of October 31, 2003, as amended by that certain
Amendment No. 1 to Amended and Restated Loan and Security Agreement dated as of
February 10, 2004, that certain Amendment No. 2 to Amended and Restated Loan and
Security Agreement dated as of May 25, 2004, that certain Amendment No. 3 to
Amended and Restated Loan and Security Agreement dated as of August 20, 2004,
and that certain Amendment No. 4 to Amended and Restated Loan and Security
Agreement dated as of the Fourth Amendment Effective Date (as may be further
amended, restated, or otherwise modified, the “Loan Agreement”), pursuant to
which the Bank has agreed to extend and make available to Borrower certain
advances of money.

 

B. Borrower desires that Bank amend the Loan Agreement upon the terms and
conditions more fully set forth herein.

 

C. Subject to the representations and warranties of Borrower herein and upon the
terms and conditions set forth in this Amendment, Bank is willing to so amend
the Loan Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing Recitals and intending to be
legally bound, the parties hereto agree as follows:

 

1. Amendment to Loan Agreement.

 

1.1 Section 6.8 (Financial Covenant). Section 6.8 is amended in its entirety by
replacing the text thereof with the following:

 

6.8 Financial Covenants.

 

Beginning on the Fourth Amendment Effective Date, Borrower shall have
unrestricted cash and cash equivalents (net of Credit Extensions) as follows:

 

Period

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   Minimum Cash and Cash
Equivalents

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For any date that is a fiscal quarter end from the Fourth Amendment Effective
Date through May 30, 2006

   $ 11,000,000

For any date that is not a fiscal quarter end from the Fourth Amendment
Effective Date through September 15, 2005, and from December 1, 2005 through
May 30, 2006

   $ 10,000,000

For any date that is not a fiscal quarter end from September 16, 2005 through
November 29, 2005

   $ 8,000,000

At any time from May 31, 2006, through May 30, 2007

   $ 9,000,000

At any time from May 31, 2007, and any date thereafter

   $ 7,500,000

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1.2 Exhibit D, “Compliance Certificate” is hereby amended by deleting it in its
entirety and replacing it with Exhibit A attached hereto.

 

2. BORROWER’S REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants
that:

 

(a) immediately upon giving effect to this Amendment (i) the representations and
warranties contained in the Loan Documents are true, accurate and complete in
all material respects as of the date hereof (except to the extent such
representations and warranties relate to an earlier date, in which case they are
true and correct as of such date), and (ii) no Event of Default has occurred and
is continuing;

 

(b) Borrower has the corporate power and authority to execute and deliver this
Amendment and to perform its obligations under the Loan Agreement, as amended by
this Amendment;

 

(c) the certificate of incorporation and bylaws of Borrower (collectively,
“Organizational Documents”) delivered to Bank on or prior to the Fourth
Amendment Effective Date are true, accurate and complete and have not been
amended, supplemented or restated and are and continue to be in full force and
effect as of the date hereof, and Borrower shall promptly deliver to Bank any
amendments, supplements, restatements or other modifications to such
Organizational Documents;

 

(d) the execution and delivery by Borrower of this Amendment and the performance
by Borrower of its obligations under the Loan Agreement, as amended by this
Amendment, have been duly authorized by all necessary corporate action on the
part of Borrower;

 

(e) this Amendment has been duly executed and delivered by the Borrower and is
the binding obligation of Borrower, enforceable against it in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, liquidation, moratorium or other similar laws of
general application and equitable principles relating to or affecting creditors’
rights; and

 

(f) as of the date hereof, it has no defenses against the obligations to pay any
amounts under the Obligations. Borrower acknowledges that Bank has acted in good
faith and has conducted in a commercially reasonable manner its relationships
with Borrower in connection with this Amendment and in connection with the Loan
Documents.

 

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Borrower understands and acknowledges that Bank is entering into this Amendment
in reliance upon, and in partial consideration for, the above representations
and warranties, and agrees that such reliance is reasonable and appropriate.

 

3. LIMITATION. The consent and amendments set forth in this Amendment shall be
limited precisely as written and shall not be deemed (a) to be a waiver or
modification of any other term or condition of the Loan Agreement or of any
other instrument or agreement referred to therein or to prejudice any right or
remedy which Bank may now have or may have in the future under or in connection
with the Loan Agreement or any instrument or agreement referred to therein; or
(b) to be a consent to any future amendment or modification or waiver to any
instrument or agreement the execution and delivery of which is consented to
hereby, or to any waiver of any of the provisions thereof. Except as expressly
amended hereby, the Loan Agreement shall continue in full force and effect.

 

4. EFFECTIVENESS. This Amendment shall become effective upon the satisfaction of
all the following conditions precedent:

 

4.1 Amendment. Borrower and Bank shall have duly executed and delivered this
Amendment to Bank.

 

4.2 Payment of Bank Expenses. Borrower shall have paid all Bank Expenses
(including all reasonable attorneys’ fees and reasonable expenses) incurred
through the date of this Amendment.

 

4.3 Amendment Fee. Borrower shall have paid to Bank an amendment fee in the
amount of $1,500.00.

 

5. COUNTERPARTS. This Amendment may be signed in any number of counterparts, and
by different parties hereto in separate counterparts, with the same effect as if
the signatures to each such counterpart were upon a single instrument. All
counterparts shall be deemed an original of this Amendment.

 

6. INTEGRATION. This Amendment and any documents executed in connection herewith
or pursuant hereto contain the entire agreement between the parties with respect
to the subject matter hereof and supersede all prior agreements, understandings,
offers and negotiations, oral or written, with respect thereto and no extrinsic
evidence whatsoever may be introduced in any judicial or arbitration proceeding,
if any, involving this Amendment; except that any financing statements or other
agreements or instruments filed by Bank with respect to Borrower shall remain in
full force and effect.

 

7. GOVERNING LAW; VENUE. THIS AMENDMENT SHALL BE GOVERNED BY AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.
Borrower and Bank each submit to the exclusive jurisdiction of the State and
Federal courts in Santa Clara County, California.

 

3

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
as of the date first written above.

 

BORROWER:   SABA SOFTWARE, INC.     a Delaware corporation     By:  

 

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    Printed Name:  

 

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    Title:  

 

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BANK:   SILICON VALLEY BANK     By:  

 

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    Printed Name:  

 

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    Title:  

 

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Exhibit A

 

EXHIBIT D

 

COMPLIANCE CERTIFICATE

 

TO:    SILICON VALLEY BANK      3003 Tasman Drive      Santa Clara, CA 95054
FROM:    SABA SOFTWARE, INC.      2400 Bridge Parkway      Redwood Shores, CA
94065

 

The undersigned authorized officer of SABA SOFTWARE, INC. (“Borrower”) certifies
that under the terms and conditions of the Amended and Restated Loan and
Security Agreement between Borrower and Bank (as further amended, restated, or
otherwise modified from time to time, the “Agreement”), (i) Borrower is in
complete compliance for the period ending                      with all required
covenants except as noted below and (ii) all representations and warranties in
the Agreement are true and correct in all material respects on this date.
Attached are the required documents supporting the certification. In addition,
the undersigned authorized officer of Borrower certifies that Borrower and each
of its Subsidiaries (x) has timely filed all required tax returns and paid, or
made adequate provision to pay, all material taxes, except those being contested
in good faith with adequate reserves under Generally Accepted Accounting
Principles (“GAAP”) and (y) does not have any legal actions pending or
threatened against Borrower or any Subsidiary, which could result in damages or
costs to Borrower or any Subsidiary of $500,000 or more and of which Borrower
has not previously notified in writing to Bank. The undersigned certifies that
these are prepared in accordance with GAAP consistently applied from one period
to the next except as explained in an accompanying letter or footnotes. The
undersigned acknowledges that no borrowings may be requested at any time or date
of determination that Borrower is not in compliance with any of the terms of the
Agreement, and that compliance is determined not just at the date this
certificate is delivered.

 

Please indicate compliance status by circling Yes/No under “Complies” column.

 

Reporting Covenant

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Required

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   Complies

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Monthly financial statements + CC

  

Monthly within 45 days

   Yes        No

Annual (Audited)

  

FYE within 120 days

   Yes        No

SEC Filings not available on EDGAR

  

Within 5 days after filing with SEC

   Yes        No

Annual Financial Projections

  

FYE within 45 days

   Yes        No

 

[continued on next page]

 

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Financial Covenant

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Required

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   Actual

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   Complies

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Unrestricted cash and cash equivalents (net

of Credit Extensions) on Borrower’s balance

sheet as set forth in the Table 1.

   Table 1.                       

Period  

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   Minimum Cash
and Cash
Equivalents

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                    For any date that is a fiscal quarter end from the Fourth
Amendment Effective Date through May 31, 2006    $11,000,000    $             
   Yes        No      For any date that is not a fiscal quarter end from Fourth
Amendment Effective Date through 9/15/05, and 12/1/05 through 5/31/06   
$10,000,000    $                 Yes        No      For any date that is not a
fiscal quarter end from 9/16/05 through 11/29/05    $8,000,000    $             
   Yes        No      At any time from June 1, 2006, through May 31, 2007   
$9,000,000    $                 Yes        No      At any time from June 1,
2007, and thereafter    $7,500,000    $                 Yes        No

 

Comments Regarding Exceptions: See Attached.   BANK USE ONLY Sincerely,  
Received by:  

 

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        AUTHORIZED SIGNER SABA SOFTWARE, INC.        

 

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  Date:  

 

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SIGNATURE   Verified:  

 

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        AUTHORIZED SIGNER

 

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        TITLE   Date:  

 

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Date

  Compliance Status:   Yes             No          

 

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