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                                                                    EXHIBIT 10.4

                        SKILLSOFT PUBLIC LIMITED COMPANY

                        2001 OUTSIDE DIRECTOR OPTION PLAN
                       (as amended as of August 23, 2006)

1.   Purposes of the Plan. The purposes of this 2001 Outside Director Option
     Plan are to attract and retain the best available personnel for service as
     Outside Directors (as defined herein) of the Company, to provide additional
     incentive to the Outside Directors of the Company to serve as Directors,
     and to encourage their continued service on the Board.

     All options granted hereunder shall be nonstatutory stock options.

2.   Definitions. As used herein, the following definitions shall apply:

     (a)  "Attorney" means in relation to an Optionee a person who acquires the
          right to manage the Optionee's affairs generally as a result of the
          Optionee's Incapacity.

     (b)  "Board" means the Board of Directors of the Company.

     (c)  "Code" means the Internal Revenue Code of 1986, as amended.

     (d)  "Company" means SkillSoft Public Limited Company, a public limited
          company organized under the laws of the Republic of Ireland.

     (e)  "Director" means a member of the Board.

     (f)  "Disability" means total and permanent disability as defined in
          section 22(e)(3) of the Code.

     (g)  "Employee" means any person, including officers and Directors,
          employed by the Company or any Parent or Subsidiary of the Company.
          The payment of a Director's fee by the Company shall not be sufficient
          in and of itself to constitute "employment" by the Company.

     (h)  "Exchange Act" means the Securities Exchange Act of 1934, as amended.

     (i)  "Fair Market Value" means, as of any date, the value of a Share
          determined as follows:

          (i)  If the Shares are listed on any established stock exchange or a
               national market system, including without limitation the Nasdaq
               National Market or The Nasdaq SmallCap Market of The Nasdaq Stock
               Market, its Fair Market Value shall be the closing sales price
               for such Shares (or the closing bid, if no sales were reported)
               as quoted on such exchange or system for the day of determination
               (or for the most recent market trading day if neither the closing
               sales price nor the closing bid for the Shares is quoted for the
               day of determination) as reported in The Wall Street Journal or
               such other source as the Board deems reliable;

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          (ii) If the Shares are regularly quoted by a recognized securities
               dealer but selling prices are not reported, the Fair Market Value
               of a Share shall be the mean between the high bid and low asked
               prices for the Shares for the day of determination (or for the
               most recent market trading day if the bid and asked prices for
               the Shares are not quoted for the day of determination), as
               reported in The Wall Street Journal or such other source as the
               Board deems reliable; or

          (iii) In the absence of an established market for the Shares, the Fair
               Market Value thereof shall be determined in good faith by the
               Board.

     (j)  "Incapacity" means, in relation to an Optionee who has a Disability,
          the inability to exercise an Option due to a medically determinable
          physical or mental impairment that has been proven to the satisfaction
          of the Board.

     (k)  "Inside Director" means a Director who is an Employee.

     (l)  "Option" means a share option granted pursuant to the Plan.

     (m)  "Optioned Shares" means Shares subject to an Option.

     (n)  "Optionee" means a Director who holds an Option.

     (o)  "Outside Director" means a Director who is not an Employee.

     (p)  "Parent" means a "parent corporation," whether now or hereafter
          existing, as defined in Section 424(e) of the Code.

     (q)  "Plan" means this 2001 Outside Director Option Plan.

     (r)  "Share" means an ordinary share of E0.11 each in the capital of the
          Company (each such ordinary share representing one American Depositary
          Share of the Company at the date hereof), as adjusted in accordance
          with Section 10 of the Plan.

     (s)  "Subsidiary" means a "subsidiary corporation," whether now or
          hereafter existing, as defined in Section 424(f) of the Internal
          Revenue Code of 1986.

3.   Shares Subject to the Plan. Subject to the provisions of Section 10 of the
     Plan, the maximum aggregate number of Shares which may be optioned and sold
     under the Plan is 750,000 Shares (the "Pool"). The Shares may be
     authorized, but unissued, or (subject to compliance with the Companies
     Acts, 1963 to 1999 of Ireland) reacquired.

     If an Option expires or becomes unexercisable without having been exercised
     in full, the unpurchased Shares which were subject thereto shall become
     available for future grant or sale under the Plan (unless the Plan has
     terminated). Shares that have actually been issued under the Plan shall not
     be returned to the Plan and shall not become available for future
     distribution under the Plan.


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4.   Administration and Grants of Options under the Plan.

     (a)  Procedure for Grants. All grants of Options to Outside Directors under
          this Plan shall be automatic and nondiscretionary and shall be made
          strictly in accordance with the following provisions:

          (i)  No person shall have any discretion to select which Outside
               Directors shall be granted Options or to determine the number of
               Shares to be covered by Options.

          (ii) Each Outside Director shall be automatically granted an Option to
               purchase 25,000 Shares (the "First Option") on the date on which
               the later of the following events occurs: (A) the effective date
               of this Plan, as determined in accordance with Section 6 hereof,
               or (B) the date on which such person first becomes an Outside
               Director, whether through election by the shareholders of the
               Company or appointment by the Board to fill a vacancy; provided,
               however, that an Inside Director who ceases to be an Inside
               Director but who remains a Director shall not receive a First
               Option.

          (iii) Each Outside Director shall be automatically granted an Option
               to purchase 10,000 Shares (a "Subsequent Option") on January 1 of
               each year provided he or she is then an Outside Director and if
               as of such date, he or she shall have served on the Board for at
               least the preceding six (6) months.

          (iv) The terms of a First Option granted hereunder shall be as
               follows:

               (A)  the term of the First Option shall be ten (10) years.

               (B)  the First Option shall be exercisable only while the Outside
                    Director remains a Director of the Company, except as set
                    forth in Sections 8 and 10 hereof.

               (C)  the exercise price per Share shall be one hundred percent
                    (100%) of the Fair Market Value per Share on the date of
                    grant of the First Option.

               (D)  subject to Section 10 hereof, the First Option shall become
                    exercisable as to 33.33% of the Shares subject to the First
                    Option on each anniversary of its date of grant, provided
                    that the Optionee continues to serve as a Director on all
                    such relevant dates. Notwithstanding the foregoing, in
                    connection with a First Grant, the vesting commencement date
                    shall be the date on which the individual was appointed by
                    the Board of Directors to serve as an Outside Director of
                    the Company or the date on which the Plan was approved by
                    the Board of Directors, whichever is later.


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          (v)  The terms of a Subsequent Option granted hereunder shall be as
               follows:

               (A)  the term of the Subsequent Option shall be ten (10) years.

               (B)  the Subsequent Option shall be exercisable only while the
                    Outside Director remains a Director of the Company, except
                    as set forth in Sections 8 and 10 hereof.

               (C)  the exercise price per Share shall be one hundred percent
                    (100%) of the Fair Market Value per Share on the date of
                    grant of the Subsequent Option.

               (D)  subject to Section 10 hereof, the Subsequent Option shall
                    become exercisable in full on the first anniversary of its
                    date of grant, provided that the Optionee continues to serve
                    as a Director on such relevant date.

          (vi) In the event that any Option granted under the Plan would cause
               the number of Shares subject to outstanding Options plus the
               number of Shares previously purchased under Options to exceed the
               Pool, then the remaining Shares available for Option grant shall
               be granted under Options to the Outside Directors on a pro rata
               basis. No further grants shall be made until such time, if any,
               as additional Shares become available for grant under the Plan
               through action of the Board or the shareholders to increase the
               number of Shares which may be issued under the Plan or through
               cancellation or expiration of Options previously granted
               hereunder.

5.   Eligibility. Options may be granted only to Outside Directors. All Options
     shall be granted automatically in accordance with the terms set forth in
     Section 4 hereof.

     The Plan shall not confer upon any Optionee any right with respect to
     continuation of service as a Director or nomination to serve as a Director,
     nor shall it interfere in any way with any rights which the Director or the
     Company may have to terminate the Director's relationship with the Company
     at any time.

6.   Term of Plan. The Plan shall become effective upon the earlier to occur of
     its adoption by the Board or its approval by the shareholders of the
     Company as described in Section 16 of the Plan. It shall continue in effect
     for a term of ten (10) years unless sooner terminated under Section 11 of
     the Plan.

7.   Form of Consideration. The consideration to be paid for the Shares to be
     issued upon exercise of an Option, including the method of payment, shall
     consist of (i) cash, (ii) check, (iii) consideration received by the
     Company under a cashless exercise program implemented by the Company in
     connection with the Plan, or (iv) any combination of the foregoing methods
     of payment.

8.   Exercise of Option.


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     (a)  Procedure for Exercise; Rights as a Shareholder. Any Option granted
          hereunder shall be exercisable at such times as are set forth in
          Section 4 hereof; provided, however, that no Options shall be
          exercisable until shareholder approval of the Plan in accordance with
          Section 16 hereof has been obtained.

          An Option may not be exercised for a fraction of a Share.

          An Option shall be deemed to be exercised when written notice of such
          exercise has been given to the Company in accordance with the terms of
          the Option by the person entitled to exercise the Option and full
          payment for the Shares with respect to which the Option is exercised
          has been received by the Company. Full payment may consist of any
          consideration and method of payment allowable under Section 7 of the
          Plan. Until the issuance (as evidenced by the appropriate entry on the
          books of the Company or of a duly authorized transfer agent of the
          Company) of the share certificate evidencing such Shares, no right to
          vote or receive dividends or any other rights as a shareholder shall
          exist with respect to the Optioned Share, notwithstanding the exercise
          of the Option. A share certificate for the number of Shares so
          acquired shall be issued to the Optionee or its nominee as soon as
          practicable after exercise of the Option. No adjustment shall be made
          for a dividend or other right for which the record date is prior to
          the date the share certificate is issued, except as provided in
          Section 10 of the Plan.

          Exercise of an Option in any manner shall result in a decrease in the
          number of Shares which thereafter may be available, both for purposes
          of the Plan and for sale under the Option, by the number of Shares as
          to which the Option is exercised.

     (b)  Termination of Continuous Status as a Director. Subject to Section 10
          hereof, in the event an Optionee's status as a Director terminates
          (other than upon the Optionee's death or Disability), the Optionee may
          exercise his or her Option, but only within three (3) months following
          the date of such termination, and only to the extent that the Optionee
          was entitled to exercise it on the date of such termination (but in no
          event later than the expiration of its ten (10) year term). To the
          extent that the Optionee was not entitled to exercise an Option on the
          date of such termination, and to the extent that the Optionee does not
          exercise such Option (to the extent otherwise so entitled) within the
          time specified herein, the Option shall terminate.

     (c)  Disability of Optionee. In the event Optionee's status as a Director
          terminates as a result of Disability, the Optionee or, in the event of
          Optionees's Incapacity, his or her Attorney, may exercise his or her
          Option, but only within twelve (12) months following the date of such
          termination, and only to the extent that the Optionee was entitled to
          exercise it on the date of such termination (but in no event later
          than the expiration of its ten (10) year term). To the extent that the
          Optionee was not entitled to exercise an Option on the date of
          termination, or if he or she does not exercise such Option (to the
          extent otherwise so entitled) within the time specified herein, the
          Option shall terminate.


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     (d)  Death of Optionee. In the event of an Optionee's death, the Optionee's
          estate or a person who acquired the right to exercise the Option by
          bequest or inheritance may exercise the Option, but only within twelve
          (12) months following the date of death, and only to the extent that
          the Optionee was entitled to exercise it on the date of death (but in
          no event later than the expiration of its ten (10) year term). To the
          extent that the Optionee was not entitled to exercise an Option on the
          date of death, and to the extent that the Optionee's estate or a
          person who acquired the right to exercise such Option does not
          exercise such Option (to the extent otherwise so entitled) within the
          time specified herein, the Option shall terminate.

9.   Non-Transferabilitv of Options. The Option may not be sold, pledged,
     assigned, hypothecated, transferred, or disposed of in any manner other
     than by will or by the laws of descent or distribution and may be
     exercised, during the lifetime of the Optionee, only by the Optionee or, in
     the event of the Optionee's Incapacity, by his or her Attorney.

10.  Adjustments Upon Changes in Capitalization, Dissolution, Merger or Asset
     Sale.

     (a)  Changes in Capitalization. Subject to any required action by the
          shareholders of the Company, the number of Shares covered by each
          outstanding Option, the number of Shares which have been authorized
          for issuance under the Plan but as to which no Options have yet been
          granted or which have been returned to the Plan upon cancellation or
          expiration of an Option, as well as the price per Share covered by
          each such outstanding Option, and the number of Shares issuable
          pursuant to the automatic grant provisions of Section 4 hereof shall
          be proportionately adjusted for any increase or decrease in the number
          of issued Shares resulting from a reorganization, bonus issue,
          reclassification or the like, or any other increase or decrease in the
          number of issued Shares effected without receipt of consideration by
          the Company; provided, however, that conversion of any convertible
          securities of the Company shall not be deemed to have been "effected
          without receipt of consideration." Except as expressly provided
          herein, no issuance by the Company of shares of any class, or
          securities convertible into shares of any class, shall affect, and no
          adjustment by reason thereof shall be made with respect to, the number
          or price of Shares subject to an Option.

     (b)  Dissolution or Liquidation. In the event of the proposed dissolution
          or liquidation of the Company, the Board shall notify each Optionee
          as soon as practicable prior to the effective date of such proposed
          transaction. Each Optionee shall have the right to exercise his or her
          Option within fifteen (15) days prior to the proposed date of such
          transaction as to all of the Optioned Shares covered thereby. To the
          extent it has not been previously exercised, an Option will terminate
          immediately prior to the consummation of such proposed action.

     (c)  Merger or Asset Sale. In the event of a merger of the Company with or
          into another corporation or the sale of substantially all of the
          assets of the Company, outstanding Options may be assumed or
          equivalent options may be substituted by the successor corporation or
          a Parent or Subsidiary thereof (the "Successor Corporation"). If an
          Option is assumed or substituted for, the Option or


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          equivalent option shall continue to be exercisable as provided in
          Section 4 hereof for so long as the Optionee serves as a Director or a
          director of the Successor Corporation. If, at any time following such
          assumption or substitution, the Optionee's status as a Director or
          director of the Successor Corporation, as applicable, is terminated
          other than upon a voluntary resignation by the Optionee, the Option or
          substituted option shall become fully exercisable. Following such
          termination the Option or substituted option shall remain exercisable
          in accordance with Sections 8(b) through (d) above.

     If the Successor Corporation does not assume an outstanding Option or
substitute for it an equivalent option, the Option shall become fully vested and
exercisable. In such event the Board shall notify the Optionee that the Option
shall be fully exercisable for a period of thirty (30) days from the date of
such notice, and upon the expiration of such period the Option shall terminate.

     For the purposes of this Section 10(c), an Option shall be considered
assumed if, following the merger or sale of assets, the Option confers the right
to purchase or receive, for each Optioned Share subject to the Option
immediately prior to the merger or sale of assets, the consideration (whether
shares, cash, or other securities or property) received in the merger or sale of
assets by holders of Shares for each Share held on the effective date of the
transaction (and if holders were offered a choice of consideration, the type of
consideration chosen by the holders of a majority of the outstanding Shares). If
such consideration received in the merger or sale of assets is not solely
ordinary shares (or their equivalent) of the Successor Corporation or its
Parent, the Board may, with the consent of the Successor Corporation, provide
for the consideration to be received upon the exercise of the Option, for each
Optioned Share, to be solely ordinary shares (or their equivalent) of the
Successor Corporation or its Parent equal in fair market value to the per share
consideration received by holders of ordinary shares in the merger or sale of
assets.

11.  Amendment and Termination of the Plan.

     (a)  Amendment and Termination. The Board may at any time amend, alter,
          suspend, or discontinue the Plan, but no amendment, alteration,
          suspension, or discontinuation shall be made which would impair the
          rights of any Optionee under any grant theretofore made, without his
          or her consent. In addition, to the extent necessary and desirable to
          comply with any applicable law, regulation or stock exchange rule, the
          Company shall obtain shareholder approval of any Plan amendment in
          such a manner and to such a degree as required.

     (b)  Effect of Amendment or Termination. Any such amendment or termination
          of the Plan shall not affect Options already granted and such Options
          shall remain in full force and effect as if this Plan had not been
          amended or terminated.

12.  Time of Granting Options. The date of grant of an Option shall, for all
     purposes, be the date determined in accordance with Section 4 hereof.

13.  Conditions Upon Issuance of Shares. Shares shall not be issued pursuant to
     the exercise of an Option unless the exercise of such Option and the
     issuance and delivery of such


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     Shares pursuant thereto shall comply with all relevant provisions of law,
     including, without limitation, the Securities Act of 1933, as amended, the
     Exchange Act, the rules and regulations promulgated thereunder, state
     securities laws, Irish law and the requirements of any stock exchange upon
     which the Shares may then be listed, and shall be further subject to the
     approval of counsel for the Company with respect to such compliance.

     As a condition to the exercise of an Option, the Company may require the
     person exercising such Option to represent and warrant at the time of any
     such exercise that the Shares are being purchased only for investment and
     without any present intention to sell or distribute such Shares, if, in the
     opinion of counsel for the Company, such a representation is required by
     any of the aforementioned relevant provisions of law.

     Inability of the Company to obtain authority from any regulatory body
     having jurisdiction, which authority is deemed by the Company's counsel to
     be necessary to the lawful issuance and sale of any Shares hereunder, 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.

14.  Reservation of Shares. The Company, during the term of this Plan, will at
     all times reserve and keep available such number of Shares as shall be
     sufficient to satisfy the requirements of the Plan.

15.  Option Agreement. Options shall be evidenced by written option agreements
     in such form as the Board shall approve.

16.  Shareholder Approval. The Plan shall be subject to approval by the
     shareholders of the Company within twelve (12) months after the date the
     Plan is adopted by the Board. Such shareholder approval shall be obtained
     in the degree and manner required under applicable state and federal law
     and any stock exchange rules.


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