Amendment No. 5 to Amended and Restated Loan and Security Agreement



 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

	  	Minimum Cash and Cash
Equivalents


	 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








 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. 
  

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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:	 	  


	 	 	Printed Name:	 	  


	 	 	Title:	 	  


		
	BANK:	 	SILICON VALLEY BANK
			
	 	 	By:	 	  


	 	 	Printed Name:	 	  


	 	 	Title:	 	  










 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

	  	 Required

	  	Complies


	 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] 
  

 1 









											
	 Financial Covenant

	  	 Required

	  	Actual

	  	Complies


	 Unrestricted cash and cash equivalents (net
 of Credit Extensions) on Borrower’s balance
 sheet as set forth in the Table 1.
	  	Table 1.	  	 	  	 	  	 	  	 
	  	 Period  

	  	Minimum Cash
and Cash
Equivalents

	  	 	  	 	  	 
	 	  	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:	 	  


	 	 	 	 	AUTHORIZED SIGNER
	SABA SOFTWARE, INC.	 	 	 	 
	  

	 	Date:	 	  


	SIGNATURE	 	Verified:	 	  


	 	 	 	 	AUTHORIZED SIGNER
	  

	 	 	 	 
	TITLE	 	Date:	 	  


			
	 Date
	 	Compliance Status:	 	Yes             No
	 	 	 	 	 

  

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