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                                                                   EXHIBIT 10.13

                             THIRD AMENDMENT TO THE
                        1997 EQUITY PARTICIPATION PLAN OF
                      WEIDER NUTRITION INTERNATIONAL, INC.

     Weider Nutrition International, Inc., a corporation organized under the
laws of the State of Delaware (the "Corporation"), originally adopted the 1997
Equity Participation Plan of Weider Nutrition International, Inc. (the "Plan")
effective as of February 28, 1997 and the Plan, as amended, was approved by the
stockholders of the Corporation on October 29, 1998. Section 10.2 of the Plan
allows the Board of Directors of the Corporation to amend the Plan in certain
respects at any time or from time to time.

     In order to revise the terms for options granted to Independent Directors
and to amend the Plan in certain other respects, this Third Amendment to the
Plan has been adopted by the Corporation, effective as set forth herein.

     1. Effective October 3, 2001, Section 3.4(d) of the Plan is hereby amended
in its entirety to read as follows:

          "(d) During the term of the Plan, Independent Directors shall be
granted Options as follows:

               (i)  Each person who is an Independent Director as of the date of
     the consummation of the initial public offering of Common Stock
     automatically shall be granted (1) an Option to purchase twenty thousand
     (20,000) shares of Common Stock (subject to adjustment as provided in
     Section 10.3) on the date of such initial public offering and (2) an Option
     to purchase twelve thousand five hundred (12,500) shares of Common Stock
     (subject to adjustment as provided in Section 10.3) on each anniversary of
     such date on which such Independent Director is then serving as such.

               (ii)  A person who is initially elected or appointed to the Board
     after the consummation of the initial public offering of Common Stock and
     who is an Independent Director at the time of such initial election or
     appointment automatically shall be granted (1) an Option to purchase twenty
     thousand (20,000) shares of Common Stock (subject to adjustment as provided
     in Section 10.3) on the date of such initial election or appointment and
     (2) an Option to purchase twelve thousand five hundred (12,500) shares of
     Common Stock (subject to adjustment as provided in Section 10.3) on each
     anniversary of such date on which such Independent Director is then serving
     as such. Members of the Board who are employees of the Company who
     subsequently retire from the Company and remain on the Board will not
     receive an initial Option grant pursuant to clause (1) of the preceding
     sentence, but to the extent that they are otherwise eligible, will receive,
     after Termination of Employment, Options as described in clause (2) of the
     preceding sentence on each anniversary of the date of Termination of
     Employment.

               (iii) As soon as practicable after October 3, 2001, each
     Independent Director who has been a member of the Board for a term of three

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     consecutive years ("Three Year Term") on or prior to October 3, 2001, shall
     be granted an Option to purchase fifteen thousand (15,000) shares of Common
     Stock (subject to adjustment as provided in Section 10.3). Each Independent
     Director who has not been a member of the Board for a Three Year Term prior
     to October 3, 2001 or who is elected or appointed to the Board after
     October 3, 2001 shall be granted an Option to purchase fifteen thousand
     (15,000) shares of Common Stock (subject to adjustment as provided in
     Section 10.3) upon the completion of a Three Year Term. Upon an Independent
     Director's completion of any one or more additional Three Year Terms
     (following the grant described above in this Section 3.4(d)(iii)), such
     Independent Director shall be granted an additional Option to purchase
     fifteen thousand (15,000) shares of Common Stock (subject to adjustment as
     provided in Section 10.3).

     2. Effective as of October 3, 2001, the following Section 3.4(e) shall be
added to the Plan:

          "(e) Through December 31, 2001, the Board shall have the authority to
grant to Independent Directors Options to purchase an aggregate of sixty
thousand (60,000) shares of Common Stock, subject to the terms set forth in
Article IV."

     3. Effective for grants of Options made on or after July 1, 2001, Section
4.4(a) of the Plan is hereby amended in its entirety to read as follows:

          "(a) The period during which the right to exercise an Option in whole
     or in part vests in the Optionee shall be set by the Committee and the
     Committee may determine that an Option may not be exercised in whole or in
     part for a specified period after it is granted; provided, however, that,
     unless the Committee otherwise provides in the terms of the Option or
     otherwise, no Option shall be exercisable by any Optionee who is then
     subject to Section 16 of the Exchange Act within the period ending six
     months and one day after the date the Option is granted; and provided,
     further, that, except for an Option granted under Section 3.4(d)(iii),
     Options granted to Independent Directors shall become exercisable in
     cumulative annual installments of thirty-three and one-third percent
     (33.33%) on each of the first, second, and third anniversaries of the date
     of Option grant, without variation or acceleration hereunder except as
     provided in Section 10.3(b), and Options granted to Independent Directors
     under Section 3.4(d)(iii) shall be exercisable immediately upon the date of
     Option grant. At any time after grant of an Option, the Committee may, in
     its sole and absolute discretion and subject to whatever terms and
     conditions it selects, accelerate the period during which an Option (except
     an Option granted to an Independent Director) vests."

                                  * * * * * * *

                                       2
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         Executed at Salt Lake City, Utah as of October __, 2001.

                                       WEIDER NUTRITION INTERNATIONAL, INC.

                                       By: ________________________________

                                       3Prepared by MERRILL CORPORATION

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EXHIBIT 10.1  

 
  CREDIT AGREEMENT    
  

    THIS AGREEMENT is entered into as of June 15, 2001, by and between SABA SOFTWARE, INC., a Delaware corporation ("Borrower"), and WELLS FARGO
BANK, NATIONAL ASSOCIATION ("Bank"). 

 
 

RECITALS    
  

    Borrower has requested that Bank extend or continue credit to Borrower as described below, and Bank has agreed to provide such credit to Borrower on the terms
and conditions contained herein. 

    NOW,
THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Bank and Borrower hereby agree as follows: 

 
 

ARTICLE I
  CREDIT TERMS    
  

    SECTION
1.1.  LINE OF CREDIT.  

    (a)  Line of Credit.  Subject to the terms and conditions of this Agreement, Bank hereby agrees to make
advances to Borrower from time to time up to and including June 30, 2002, not to exceed at any time the aggregate principal amount of Eight Million Dollars ($8,000,000.00) ("Line of Credit"),
the proceeds of which shall be used to finance Borrower's working capital requirements, for general corporate purposes and, in the amount not to exceed $3,000,000.00 outstanding at any time, for
capital expenditures. Borrower's obligation to repay advances under the Line of Credit shall be evidenced by a promissory note substantially in the form of Exhibit A attached hereto ("Line of
Credit Note"), all terms of which are incorporated herein by this reference. 

    (b)  Letter of Credit Subfeature.  As a subfeature under the Line of Credit, Bank agrees from time to
time during the term thereof to issue or cause an affiliate to issue standby letters of credit for the account of Borrower (each, a "Letter of Credit" and collectively, "Letters of Credit"); provided
however, that the aggregate undrawn amount of all outstanding Letters of Credit shall not at any time exceed Seven Hundred Fifty Thousand Dollars ($750,000.00). The form and substance of each Letter
of Credit shall be subject to approval by Bank, in its reasonable discretion. No Letter of Credit shall have an expiration date more than three hundred sixty-five (365) days beyond
the maturity date of the Line of Credit. The undrawn amount of all Letters of Credit shall be reserved under the Line of Credit and shall not be available for borrowings thereunder. Each Letter of
Credit shall be subject to the additional terms and conditions of the Bank's then standard form of Letter of Credit agreements, applications and any related documents required by Bank in connection
with the issuance thereof. In the event that any provision of such Letter of Credit agreement, application or related document is directly contradicted by the terms of this Agreement, the terms of
this Agreement shall control. Without limiting the foregoing, any collateral granted to Bank or an affiliate of Bank under any such Letter of Credit agreements, applications or related documents shall
not extend to any property of Borrower that is not Collateral under and as defined in this Agreement or any security agreement as described in Sections 1.3 or 3.1 of this Agreement. Each draft paid
under a Letter of Credit, if not reimbursed by Borrower on the honor date thereof, shall be deemed an advance under the Line of Credit and shall be repaid by Borrower in accordance with the terms and
conditions of this Agreement applicable to such advances; provided however, that if advances under the Line of Credit are not available, for any reason, at the time any draft is paid, then Borrower
shall immediately pay to Bank the full amount of such draft, together with interest thereon from the date such draft is paid to the date such amount is fully repaid by Borrower, at the rate of
interest that would have been applicable to advances under the Line of Credit if the Line of Credit were available. In such event 

Borrower agrees that Bank, in its sole discretion, may debit any account maintained by Borrower with Bank for the amount of any such draft. 

    (c)  Borrowing and Repayment.  Borrower may from time to time during the term of the Line of Credit
borrow, partially or wholly repay its outstanding borrowings, and reborrow, subject to all of the limitations, terms and conditions contained herein or in the Line of Credit Note; provided however,
that the total outstanding borrowings under the Line of Credit shall not at any time exceed the maximum principal amount available thereunder, as set forth above. 

    SECTION
1.2.  INTEREST/FEES.  

    (a)  Interest.  The outstanding principal balance of the Line of Credit shall bear interest at the rate
of interest set forth in the Line of Credit Note. 

    (b)  Computation and Payment.  Interest shall be computed on the basis of a 360-day year,
actual days elapsed. Interest shall be payable at the times and place set forth in the Line of Credit Note. 

    (c)  Unused Commitment Fee.  Borrower shall pay to Bank a fee equal to one-half percent
(.50%) per annum (computed on the basis of a 360-day year, actual days elapsed) on the average daily unused amount of the Line of Credit (the undrawn amount of issued Letters of Credit
reserved under the Line of Credit shall be deemed usage for purposes of this calculation), which fee shall be calculated on a 360 basis by Bank and shall be due and payable by Borrower quarterly in
arrears on the last day of each fiscal quarter, unless such day is not a Business Day (as defined in the Line of Credit Note) in which case such fee shall be payable on the next succeeding Business
Day. 

    (d)  Letter of Credit Fees.  Borrower shall pay to Bank (i) fees upon the issuance of each Letter
of Credit equal to one percent (1.00%) per annum (computed on the basis of a 360-day year, actual days elapsed) of the face amount thereof, and (ii) fees upon the payment or
negotiation of each draft under any Letter of Credit and fees upon the occurrence of any other activity with respect to any Letter of Credit (including without limitation, the transfer, amendment or
cancellation of any Letter of Credit) determined in accordance with Bank's standard fees and charges then in effect for such activity. 

    SECTION
1.3.  COLLATERAL.  

    As
security for all indebtedness of Borrower to Bank subject hereto, Borrower hereby grants to Bank security interests of first priority in all Collateral under, and as defined in,
the Security Agreements described in Section 3.1(b) hereof and such other security agreements as Borrower may from time to time execute and deliver in connection with this Agreement or the
other Loan Documents. The Collateral includes, without limitation, and Borrower hereby grants to Bank a security interest of first priority, in all of Borrower's accounts receivable and equipment and
in Wells Capital Management account number            (the "Securities Account") and all amounts and other financial assets held therein. 

    All
of the foregoing shall be evidenced by and subject to the terms of such security agreements, financing statements and other documents as Bank shall reasonably require, all in form
and substance satisfactory to Bank. Borrower shall reimburse Bank immediately upon demand for all costs and expenses incurred by Bank in connection with any of the foregoing security, including
without limitation, filing and recording fees and costs of appraisals and audits. 

 
 

ARTICLE II
  REPRESENTATIONS AND WARRANTIES    
  

    Borrower makes the following representations and warranties to Bank, which representations and warranties shall survive the execution of this Agreement and
shall continue in full force and effect until
the full and final payment, and satisfaction and discharge, of all obligations of Borrower to Bank subject to this Agreement. 

    SECTION 2.1.  LEGAL STATUS.  Borrower is a corporation, duly organized and existing and in good standing
under the laws of the State of Delaware, and is qualified or licensed to do business (and is in good standing as a foreign corporation, if applicable) in all jurisdictions in which such qualification
or licensing is necessary or desirable if the failure to so qualify or to be so licensed could have a material adverse effect on Borrower. 

    SECTION
2.2.  AUTHORIZATION AND VALIDITY.  This Agreement and each promissory note, contract, instrument
and other document required hereby or at any time hereafter delivered to Bank in connection herewith (collectively, the "Loan Documents") have been duly authorized, and upon their execution and
delivery in accordance with the provisions hereof will constitute legal, valid and binding agreements and obligations of Borrower, enforceable in accordance with their respective terms. 

    SECTION
2.3.  NO VIOLATION.  The execution, delivery and performance by Borrower of each of the Loan
Documents do not violate any provision of any law or regulation, or contravene any provision of the Articles of Incorporation or By-Laws of Borrower, or result in any breach of or default
under any contract, obligation, indenture or other instrument to which Borrower is a party or by which Borrower may be bound. 

    SECTION
2.4.  LITIGATION.  There are no pending, or to the best of Borrower's knowledge threatened,
actions, claims, investigations, suits or proceedings by or before any governmental authority, arbitrator, court or administrative agency which could have a material adverse effect on the condition
(financial or otherwise), business, assets or operations of Borrower other than those disclosed by Borrower to Bank in writing prior to the date hereof. 

    SECTION
2.5.  CORRECTNESS OF FINANCIAL STATEMENT.  The financial statement of Borrower dated
February 28, 2001, a true copy of which has been delivered by Borrower to Bank prior to the date hereof, (a) is complete and correct and presents fairly the financial condition of
Borrower, (b) discloses all liabilities of Borrower that are required to be reflected or reserved against under generally accepted accounting principles, whether liquidated or unliquidated,
fixed or contingent, and (c) has been prepared in accordance with generally accepted accounting principles consistently applied. Since the date of such financial statement there has been no
material adverse change in the financial condition of Borrower, nor has Borrower mortgaged, pledged, granted a security interest in or otherwise encumbered any of its assets or properties except as
follows (collectively, "Permitted Liens"): (i) liens in favor of Bank or as otherwise permitted by Bank in writing; (ii) liens existing on the date of this Agreement and listed on
Schedule 2.5; (iii) liens for taxes, assessments, levies or other governmental charges not yet delinquent or being contested in good faith and by appropriate proceedings for which
adequate reserves are being maintained; (iv) carriers', warehousemen's, materialmen's and mechanics' and other similar liens imposed by law arising in the ordinary course of business which are
not delinquent or which are being contested in good faith and by appropriate proceedings for which adequate reserves are being maintained; (v) liens incurred or deposits made in the ordinary
course of business in connection with workers' compensation, unemployment insurance and other types of social security legislation and other liens to secure the performance and return of money bonds
and other similar obligations (exclusive of obligations for the payment of borrowed money) incurred in the ordinary course of business, whether pursuant to statutory requirements, common law or
consensual arrangements so long as no such liens attach to any of the Collateral if any obligation secured thereby is delinquent and so long as no foreclosure, sale or similar proceedings have been
commenced with respect to any such lien; (vi) liens (including in respect of capital lease obligations) upon any property acquired or held by Borrower to secure the purchase price of such
property or indebtedness incurred solely for the purpose of financing the acquisition of such property, so long as (A) such lien extends only to the property acquired or financed and proceeds
(including insurance proceeds) thereof (B) such lien attaches to such property concurrently with or within ninety (90) days after the acquisition thereof, and (C) the principal
amount of the indebtedness secured thereby does not exceed 100% of the cost of such property (vii) nonexclusive licenses and sublicenses granted to others in the ordinary course of business
that do not interfere in any material respect with the conduct of Borrower's business or result in any material diminution in the value of any Collateral; 

(viii) liens securing judgments, decrees or attachments in circumstances not constituting an Event of Default, but excluding any lien in respect of any such judgment, decree or attachment that
remains undischarged for a period of more than thirty (30) days during which execution is not stayed; (ix) liens in favor of customs and review authorities arising as a matter of law to
secure payments of customs duties in connection with the importation of goods; and (x) in the case of clauses (ii), (vi) and (vii) above, any renewals, extensions or replacements
thereof, provided that the property covered thereby is not increased or expanded and any renewal, extension or replacement of the obligations secured or benefited thereby is permitted by  Section 5.2 and does not increase the amount secured thereby. 

    All
Permitted Liens with respect to which Borrower has executed any financing statement, security agreement, pledge or charge and that are existing as of the date of this Agreement
are listed on Schedule 2.5

    SECTION
2.6.  INCOME TAX RETURNS.  Borrower has no knowledge of any pending assessments or adjustments of
its income tax payable with respect to any year. 

    SECTION
2.7.  NO SUBORDINATION.  There is no agreement, indenture, contract or instrument to which
Borrower is a party or by which Borrower may be bound that requires the subordination in right of payment of any of Borrower's obligations subject to this Agreement to any other obligation of
Borrower. 

    SECTION
2.8.  PERMITS, FRANCHISES.  Borrower possesses, and will hereafter possess, all permits,
consents, approvals, franchises and licenses required and rights to all trademarks, trade names, patents, and fictitious names, if any, necessary to enable it to conduct the business in which it is
now engaged in compliance with applicable law except to the extent such failure to possess, or compliance with applicable law would not have a material adverse effect of the condition (financial or
otherwise), business, assets or operations of Borrower. 

    SECTION
2.9.  ERISA.  Borrower is in compliance in all material respects with all applicable provisions
of the Employee Retirement Income Security Act of 1974, as amended or recodified from time to time ("ERISA"); Borrower has not violated any provision of any defined employee pension benefit plan (as
defined in ERISA) maintained or contributed to by Borrower (each, a "Plan"); no Reportable Event as defined in ERISA has occurred and is continuing with respect to any Plan initiated by Borrower;
Borrower has met its minimum funding requirements under ERISA with respect to each Plan; and each Plan will be able to fulfill its benefit obligations as they come due in accordance with the Plan
documents and under generally accepted accounting principles. 

    SECTION
2.10.  OTHER OBLIGATIONS.  Borrower is not in default on any obligation for borrowed money, any
purchase money obligation or any other material lease, commitment, contract, instrument or obligation. 

    SECTION
2.11.  ENVIRONMENTAL MATTERS.  Except as disclosed by Borrower to Bank in writing prior to the
date hereof, Borrower is in compliance with all applicable federal or state environmental, hazardous waste, health and safety statutes, and any rules or regulations adopted pursuant thereto, which
govern or affect any of Borrower's operations and/or properties, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, the Superfund
Amendments and Reauthorization Act of 1986, the Federal Resource Conservation and Recovery Act of 1976, and the Federal Toxic Substances Control Act, as any of the same may be amended, modified or
supplemented from time to time, except to the extent that any failure so to be in compliance has not had and could not reasonably be expected to have a material adverse effect on the condition
(financial or otherwise), business, assets or operations of the Borrower. None of the operations of Borrower is the subject of any federal or state investigation evaluating whether any remedial action
involving a material expenditure is needed to respond to a release of any toxic or hazardous waste or substance into the environment. To the best of Borrower's knowledge, Borrower has no material
contingent liability in connection with any release of any toxic or hazardous waste or substance into the environment. 

 
 

ARTICLE III
  CONDITIONS    
  

    SECTION
3.1.  CONDITIONS OF INITIAL EXTENSION OF CREDIT.  The obligation of Bank to make the initial
extension of credit contemplated by this Agreement is subject to the fulfillment to Bank's satisfaction of all of the following conditions: 

    (a)  Approval of Bank Counsel.  All legal matters incidental to the extension of credit by Bank shall be
satisfactory to Bank's counsel. 

    (b)  Documentation.  Bank shall have received, in form and substance satisfactory to Bank, each of the
following, duly executed: 

	(i)	 	This Agreement and each promissory note or other instrument required hereby;
	(ii)	 	Security Agreement: Securities Account;
	(iii)	 	Securities Account Control Agreement-WF Affiliate Intermediary;
	(iv)	 	Corporate Resolution: Borrowing;
	(v)	 	Certificate of Incumbency;
	(vi)	 	Addendum to Security Agreement: Securities Account;
	(vii)	 	Continuing Security Agreement: Rights to Payment;
	(viii)	 	Security Agreement: Equipment; and
	(ix)	 	such other documents as Bank may require under any other Section of this Agreement.

    (c)  Insurance.  Borrower shall have delivered to Bank evidence of insurance coverage on all Borrower's
property, in form, substance, amounts, covering risks and issued by companies satisfactory to Bank, and where required by Bank, with loss payable endorsements in favor of Bank. 

    SECTION
3.2.  CONDITIONS OF EACH EXTENSION OF CREDIT.  The obligation of Bank to make each extension of
credit requested by Borrower hereunder (including the initial extension) shall be subject to the fulfillment to Bank's satisfaction of each of the following conditions: 

    (a)  Compliance.  The representations and warranties contained herein and in each of the other Loan
Documents shall be true on and as of the date of the signing of this Agreement and on the date of each extension of credit by Bank pursuant hereto, with the same effect as though such representations
and warranties had been made on and as of each such date, and on each such date, no Event of Default as defined herein, and no condition, event or act which with the giving of notice or the passage of
time or both would constitute such an Event of Default, shall have occurred and be continuing or shall exist. 

    (b)  Documentation.  Bank shall have received all additional documents which may reasonably be required
in connection with such extension of credit. 

    (c)  Financial Condition.  There shall have been no material adverse change, as determined by Bank, in
the financial condition or business of Borrower, nor any material decline, as reasonably determined by Bank, in the market value of any material portion of the collateral required hereunder or a
substantial or material portion of the assets of Borrower. Bank acknowledges that Borrower is not profitable and is in a negative cash flow position and that Borrower is not expected to become
profitable or to be in a positive cash flow position during the term of this Agreement and Bank agrees that Borrower's continuing losses and negative cash flow substantially as forecasted in public
financial information available as of the date of execution of this Agreement, and the effect on Borrower's financial condition as a result thereof, shall not be deemed to be a material adverse change
in the financial condition or business of Borrower. Without limiting the foregoing, Bank shall have no obligation to make any extension of credit under this Agreement, including, without limitation to
issue any Letter of Credit, if on the date of the request therefore or the date of such extension the amount held in the Securities Account is 

less than one hundred fifty percent (150%) of the Line of Credit (including all used and unused amounts thereunder). 

 
 

ARTICLE IV
  AFFIRMATIVE COVENANTS    
  

    Borrower covenants that so long as Bank remains committed to extend credit to Borrower pursuant hereto, or any liabilities (whether direct or contingent,
liquidated or unliquidated) of Borrower to Bank
under any of the Loan Documents remain outstanding, and until payment in full of all obligations of Borrower subject hereto, Borrower shall, unless Bank otherwise consents in writing: 

    SECTION
4.1.  PUNCTUAL PAYMENTS.  Punctually pay all principal, interest, fees or other liabilities due
under any of the Loan Documents at the times and place and in the manner specified therein. 

    SECTION
4.2.  ACCOUNTING RECORDS.  Maintain adequate books and records in accordance with generally
accepted accounting principles consistently applied, and permit any representative of Bank, at any reasonable time, to inspect, audit and examine such books and records, to make copies of the same,
and to inspect the properties of Borrower. 

    SECTION
4.3.  FINANCIAL STATEMENTS.  Provide to Bank all of the following, in form and detail
satisfactory to Bank: 

    (a) not
later than 120 days after and as of the end of each fiscal year, an audited financial statement of Borrower, prepared by a certified public accountant
acceptable to Bank, 

    (b) not
later than 45 days after and as of the end of each fiscal quarter, a financial statement of Borrower, prepared by Borrower, to include balance sheet and
income statement; 

    (c) from
time to time such other information as Bank may reasonably request. 

    SECTION
4.4.  COMPLIANCE.  Preserve and maintain all licenses, permits, governmental approvals, rights,
privileges and franchises necessary for the conduct of its business; and comply with the provisions of all documents pursuant to which Borrower is organized and/or which govern Borrower's continued
existence and with the requirements of all laws, rules, regulations and orders of any governmental authority applicable to Borrower and/or its business except in each case where failure to do so does
not have a material adverse effect on the condition (financial or otherwise), business, assets or operations of Borrower. 

    SECTION
4.5.  INSURANCE.  Maintain and keep in force insurance of the types and in amounts customarily
carried in lines of business similar to that of Borrower, including but not limited to fire, extended coverage, public liability, flood, property damage and workers' compensation, with all such
insurance carried with companies and in amounts satisfactory to Bank, and deliver to Bank from time to time at Bank's request schedules setting forth all insurance then in effect. 

    SECTION
4.6.  FACILITIES.  Keep all material properties useful or necessary to Borrower's business in
good repair and condition, normal wear and tear excepted, and from time to time make necessary repairs, renewals and replacements thereto so that such properties shall be fully and efficiently
preserved and maintained. 

    SECTION
4.7.  TAXES AND OTHER LIABILITIES.  Pay and discharge when due any and all material indebtedness,
obligations, assessments and taxes, both real or personal, including without limitation federal and state income taxes and state and local property taxes and assessments, except such (a) as
Borrower may in good faith contest or as to which a bona fide dispute may arise, and (b) for which Borrower maintains with respect thereto adequate reserves in accordance with generally
accepted accounting principles. 

    SECTION
4.8.  LITIGATION.  Promptly give notice in writing to Bank of any litigation pending or
threatened against Borrower with a claim in excess of $1,000,000.00. 

    SECTION 4.9.  NOTICE TO BANK.  Promptly (but in no event more than five (5) days after the
occurrence of each such event or matter) give written notice to Bank in reasonable detail of: (a) the occurrence of any Event of Default, or any condition, event or act which with the giving of
notice or the passage of time or both would constitute an Event of Default; (b) any change in the name or the organizational structure of Borrower; (c) the occurrence and nature of any
Reportable Event or Prohibited Transaction, each as defined in ERISA, or any material funding deficiency with respect to any Plan; or (d) any termination or cancellation of any insurance policy
which Borrower is required to maintain and not immediately replaced by insurance policies meeting the requirements of this Agreement, or any uninsured or partially uninsured loss through liability or
property damage, or through fire, theft or any other cause affecting Borrower's property in excess of an aggregate of $1,000,000.00. 

 
 

ARTICLE V
  NEGATIVE COVENANTS    
  

    Borrower further covenants that so long as Bank remains committed to extend credit to Borrower pursuant hereto, or any liabilities (whether direct or
contingent, liquidated or unliquidated) of Borrower to Bank under any of the Loan Documents remain outstanding, and until payment in full of all obligations of Borrower subject hereto, Borrower will
not without Bank's prior written consent: 

    SECTION
5.1.  USE OF FUNDS.  Use any of the proceeds of any credit extended hereunder except for the
purposes stated in Article I hereof. 

    SECTION
5.2.  OTHER INDEBTEDNESS.  Create, incur, assume or permit to exist any indebtedness or
liabilities resulting from borrowings, loans or advances, whether secured or unsecured, matured or unmatured, liquidated or unliquidated, joint or several, except (a) the liabilities of
Borrower to Bank, (b) any other liabilities of Borrower existing as of, and disclosed to Bank prior to, the date hereof, (c) any indebtedness or liability secured by Permitted Liens of
the type described in clause (vi) of Section 2.5, (d) any indebtedness to finance insurance premiums or to finance trade payables, and (e) unsecured indebtedness in an
amount not to exceed in the aggregate $1,000,000 at any time outstanding. 

    SECTION
5.3.  GUARANTIES.  Guarantee or become liable in any way as surety, endorser (other than as
endorser of negotiable instruments for deposit or collection in the ordinary course of business), accommodation endorser or otherwise for, nor pledge or hypothecate any assets of Borrower as security
for, any liabilities or obligations of any other person or entity, except any of the foregoing (a) in favor of Bank and (b) in respect of any indebtedness or other liability of a
wholly-owned subsidiary of Borrower to the extent that, if Borrower were to be primarily obligated with respect to such guaranteed liability, Borrower would be permitted to incur such indebtedness or
other liability pursuant to Section 5.2. 

    SECTION
5.4.  MERGER, CONSOLIDATION, TRANSFER OF ASSETS.  Merge into acquire or consolidate with any
other entity, unless (i) Borrower is the surviving entity, and (ii) Borrower's senior management that is in place prior to and after the merger, acquisition or consolidation remains
substantially intact following the same; make any substantial change in the nature of Borrower's business as conducted as of the date hereof; nor sell, lease, transfer or otherwise dispose of all or a
substantial or material portion of Borrower's assets except in the ordinary course of its business. 

    SECTION
5.5.  PLEDGE OF ASSETS.  Mortgage, pledge, grant or permit to exist a security interest in, or
lien upon, all or any portion of Borrower's assets now owned or hereafter acquired, except Permitted Liens. 

 
 

ARTICLE VI
  EVENTS OF DEFAULT    
  

    SECTION
6.1.    The occurrence of any of the following shall constitute an "Event of Default" under this
Agreement: 

    (a) Borrower
shall fail to pay when due any principal or interest, or to pay within 10 days of the due date thereof any fees or other amounts payable under any
of the Loan Documents. 

    (b) Any
financial statement or certificate furnished to Bank in connection with, or any representation or warranty made by or on behalf of Borrower under this Agreement
or any other Loan Document shall prove to be incorrect, false or misleading in any material respect when furnished or made, or any default in the performance of or compliance with Borrower's
obligations and covenants under Article 5 of this Agreement. 

    (c) Any
default in the performance of or compliance with any obligation, agreement or other provision contained herein or in any other Loan Document (other than those
referred to in subsections (a) and (b) above), and with respect to any such default which by its nature can be cured, such default shall continue for a period of thirty (30) days
from its occurrence. 

    (d) Any
default in the payment or performance of any material obligation, or any defined event of default, under the terms of any material contract or instrument (other
than any of the Loan Documents) pursuant to which Borrower has incurred any debt or other liability to any person or entity, including Bank. 

    (e) The
filing of a notice of judgment lien in excess of $1,000,000 against Borrower; or the recording of any abstract of judgment against Borrower in excess of
$1,000,000 in any county in which Borrower has an interest in real property; or the service of a notice of levy and/or of a writ of attachment or execution, or other like process, against the
Securities Account or against any material portion (as determined by Bank) of any other Collateral or against any material portion of the assets of Borrower; or the entry of a judgment against
Borrower that is not discharged, satisfied, vacated or stayed pending appeal within 30 days. 

    (f)  Borrower
shall become insolvent, or shall suffer or consent to or apply for the appointment of a receiver, trustee, custodian or liquidator of itself or all or any
material portion of its property, or shall generally fail to pay its debts as they become due, or shall make a general assignment for the benefit of creditors; Borrower shall file a voluntary
petition in bankruptcy, or seeking reorganization, in order to effect a plan or other arrangement with creditors or any other relief under the Bankruptcy Reform Act, Title 11 of the United States
Code, as amended or recodified from time to time ("Bankruptcy Code"), or under any state or federal law granting relief to debtors, whether now or hereafter in effect; or any involuntary petition or
proceeding pursuant to the Bankruptcy Code or any other applicable state or federal law relating to bankruptcy, reorganization or other relief for debtors is filed or commenced against Borrower which
continues undismissed for 60 days, or Borrower shall file an answer admitting the jurisdiction of the court and the material allegations of any involuntary petition; or Borrower shall be
adjudicated a bankrupt, or an order for relief shall be entered against Borrower by any court of
competent jurisdiction under the Bankruptcy Code or any other applicable state or federal law relating to bankruptcy, reorganization or other relief for debtors. 

    (g) There
shall exist or occur any event or condition which Bank in good faith believes impairs, or is substantially likely to impair, either the Collateral Value of
the Securities Account or the prospect of payment or performance by Borrower of its obligations under any of the Loan Documents; provided that, Borrower's continuing losses and negative cash flow
substantially as forecasted in public financial information available as of the date of execution of this Agreement, and the effect on Borrower's financial condition as a result thereof, shall not be
deemed to be such an event or condition. 

    (h) The dissolution or liquidation of Borrower; or Borrower, or any of its directors, stockholders or members, shall take action seeking to effect the dissolution or
liquidation of Borrower. 

    (i)  The
sale, transfer, hypothecation, assignment or encumbrance, whether voluntary, involuntary or by operation of law, without Bank's prior written consent, of all
or any part of or interest in any real property collateral required hereby. 

    SECTION
6.2.  REMEDIES.  Upon the occurrence of any Event of Default: (a) all indebtedness of
Borrower under each of the Loan Documents, any term thereof to the contrary notwithstanding, shall at Bank's option and without notice become immediately due and payable without presentment, demand,
protest or notice of dishonor, all of which are hereby expressly waived by each Borrower; (b) the obligation, if any, of Bank to extend any further credit under any of the Loan Documents shall
immediately cease and terminate; and (c) Bank shall have all rights, powers and remedies available under each of the Loan Documents, or accorded by law, including without limitation the right
to resort to any or all security for any credit subject hereto and to exercise any or all of the rights of a beneficiary or secured party pursuant to applicable law. All rights, powers and remedies of
Bank may be exercised at any time by Bank and from time to time after the occurrence of an Event of Default, are cumulative and not exclusive, and shall be in addition to any other rights, powers or
remedies provided by law or equity. 

 
 

ARTICLE VII
  MISCELLANEOUS    
  

    SECTION
7.1.  NO WAIVER.  No delay, failure or discontinuance of Bank in exercising any right, power or
remedy under any of the Loan Documents shall affect or operate as a waiver of such right, power or remedy; nor shall any single or partial exercise of any such right, power or remedy preclude, waive
or otherwise affect any other or further exercise thereof or the exercise of any other right, power or remedy. Any waiver, permit, consent or approval of any kind by Bank of any breach of or default
under any of the Loan Documents must be in writing and shall be effective only to the extent set forth in such writing. 

    SECTION
7.2.  NOTICES.  All notices, requests and demands which any party is required or may desire to
give to any other party under any provision of this Agreement must be in writing delivered to each party at the following address: 

	BORROWER:	 	SABA SOFTWARE, INC.

2400 Bridge Parkway

Redwood Shores, CA 94065

Facsimile No: (650) 581-2545
	

BANK:	
 	

WELLS FARGO BANK, NATIONAL ASSOCIATION

Peninsula Regional Commercial Banking Office

400 Hamilton Avenue

Palo Alto, CA 94301

Facsimile No: (650) 328-0814

or
to such other address as any party may designate by written notice to all other parties. Each such notice, request and demand shall be deemed given or made as follows: (a) if sent by hand
delivery, upon delivery; (b) if sent by mail, upon the earlier of the date of receipt or three (3) days after deposit in the U.S. mail, first class and postage prepaid; and (c) if
sent by telecopy, upon receipt. 

    SECTION
7.3.  COSTS, EXPENSES AND ATTORNEYS' FEES.  Borrower shall pay to Bank within 10 days of
written demand therefore the full amount of all payments, advances, charges, costs and expenses, including reasonable attorneys' fees (to include outside counsel fees and all allocated costs of Bank's
in-house counsel), expended or incurred by Bank in connection with (a) the negotiation 

and preparation of this Agreement and the other Loan Documents, Bank's continued administration hereof and thereof, and the preparation of any amendments and waivers hereto and thereto, (b) the
enforcement of Bank's rights and/or the collection of any amounts which become due to Bank under any of the Loan Documents, and (c) the prosecution or defense of any action in any way related
to any
of the Loan Documents, including without limitation, any action for declaratory relief, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including any
of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding, contested matter or motion brought by Bank or any other person) relating
to any Borrower or any other person or entity. 

    SECTION
7.4.  SUCCESSORS, ASSIGNMENT.  This Agreement shall be binding upon and inure to the benefit of
the heirs, executors, administrators, legal representatives, successors and assigns of the parties; provided however, that Borrower may not assign or transfer its interest hereunder without Bank's
prior written consent. Bank reserves the right to sell, assign, transfer, negotiate or grant participations in all or any part of, or any interest in, Bank's rights and benefits under each of the Loan
Documents at any time that an Event of Default exists and otherwise at any time on or after 60 days notice to Borrower. In connection therewith, Bank may disclose all documents and information
which Bank now has or may hereafter acquire relating to any credit subject hereto, Borrower or its business, or any collateral required hereunder, provided that such entity agrees to be subject to any
confidentiality agreements applicable hereto to the same extent as Bank. 

    SECTION
7.5.  ENTIRE AGREEMENT; AMENDMENT.  This Agreement and the other Loan Documents constitute the
entire agreement between Borrower and Bank with respect to each credit subject hereto and supersede all prior negotiations, communications, discussions and correspondence concerning the subject matter
hereof and thereof. This Agreement may be amended or modified only in writing signed by each party hereto. 

    SECTION
7.6.  NO THIRD PARTY BENEFICIARIES.  This Agreement is made and entered into for the sole
protection and benefit of the parties hereto and their respective permitted successors and assigns, and no other person or entity shall be a third party beneficiary of, or have any direct or indirect
cause of action or claim in connection with, this Agreement or any other of the Loan Documents to which it is not a party. 

    SECTION
7.7.  TIME.  Time is of the essence of each and every provision of this Agreement and each other
of the Loan Documents. 

    SECTION
7.8.  SEVERABILITY OF PROVISIONS.  If any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity without invalidating the remainder of such provision or any remaining provisions
of this Agreement. 

    SECTION
7.9.  COUNTERPARTS.  This Agreement may be executed in any number of counterparts, each of which
when executed and delivered shall be deemed to be an original, and all of which when taken together shall constitute one and the same Agreement. 

    SECTION
7.10.  GOVERNING LAW.  This Agreement shall be governed by and construed in accordance with the
laws of the State of California. 

    SECTION
7.11.  ARBITRATION.  

    (a)  Arbitration.  The parties hereto agree, upon demand by any party, to submit to binding arbitration
all claims, disputes and controversies between or among them (and their respective employees, officers, directors, attorneys, and other agents), whether in tort, contract or otherwise arising out of
or relating to in any way (i) the loan and related Loan Documents which are the subject of this Agreement and its negotiation, execution, collateralization, administration, repayment,
modification, extension, substitution, formation, inducement, enforcement, default or termination; or (ii) requests for additional credit. 

    (b)  Governing Rules.  Any arbitration proceeding will (i) proceed in a location in California
selected by the American Arbitration Association ("AAA"); (ii) be governed by the Federal Arbitration Act (Title 9 of the United States Code), notwithstanding any conflicting choice of law
provision in any of the documents between the parties; and (iii) be conducted by the AAA, or such other administrator as the parties shall mutually agree upon, in accordance with the AAA's
commercial dispute resolution procedures, unless the claim or counterclaim is at least $1,000,000.00 exclusive of claimed interest, arbitration fees and costs in which case the arbitration shall be
conducted in accordance with the AAA's optional procedures for large, complex commercial disputes (the commercial dispute resolution procedures or the optional procedures for large, complex commercial
disputes to be referred to, as applicable, as the "Rules"). If there is any inconsistency between the terms hereof and the Rules, the terms and procedures set forth herein shall control. Any party who
fails or refuses to submit to arbitration following a demand by any other party shall bear all costs and expenses incurred by such other party in compelling arbitration of any dispute. Nothing
contained herein shall be deemed to be a waiver by any party that is a bank of the protections afforded to it under 12 U.S.C. §91 or any similar applicable state law. 

    (c)  No Waiver of Provisional Remedies, Self-Help and Foreclosure.  The arbitration
requirement does not limit the right of any party to (i) foreclose against real or personal property collateral; (ii) exercise self-help remedies relating to collateral or
proceeds of collateral such as setoff or repossession; or (iii) obtain provisional or ancillary remedies such as replevin, injunctive relief, attachment or the appointment of a receiver, before
during or after the pendency of any arbitration proceeding. This exclusion does not constitute a waiver of the right or obligation of any party to submit any dispute to arbitration or reference
hereunder, including those arising from the exercise of the actions detailed in sections (i), (ii) and (iii) of this paragraph. 

    (d)  Arbitrator Qualifications and Powers.  Any arbitration proceeding in which the amount in controversy
is $5,000,000.00 or less will be decided by a single arbitrator selected according to the Rules, and who shall not render an award of greater than $5,000,000.00. Any dispute in which the amount in
controversy exceeds $5,000,000.00 shall be decided by majority vote of a panel of three arbitrators; provided however, that all three arbitrators must actively participate in all hearings and
deliberations. The arbitrator will be a neutral attorney licensed in the State of California or a neutral retired judge of the state or federal judiciary of California, in either case with a minimum
of ten years experience in the substantive law applicable to the subject matter of the dispute to be arbitrated. The arbitrator will determine whether or not an issue is arbitratable and will give
effect to the statutes of limitation in determining any claim. In any arbitration proceeding the arbitrator will decide (by documents only or with a hearing at the arbitrator's discretion) any
pre-hearing motions which are similar to motions to dismiss for failure to state a claim or motions for summary adjudication. The arbitrator shall resolve all disputes in accordance with
the substantive law of California and may grant any remedy or relief that a court of such state could order or grant within the scope hereof and such ancillary relief as is necessary to make effective
any award. The arbitrator shall also have the power to award recovery of all costs and fees, to impose sanctions and to take such other action as the arbitrator deems necessary to the same extent a
judge could pursuant to the Federal Rules of Civil Procedure, the California Rules of Civil Procedure or other applicable law. Judgment upon the award rendered by the arbitrator may be entered in any
court having jurisdiction. The institution and maintenance of an action for judicial relief or pursuit of a provisional or ancillary remedy shall not constitute a waiver of the right of any party,
including the plaintiff, to submit the controversy or claim to arbitration if any other party contests such action for judicial relief. 

    (e)  Discovery.  In any arbitration proceeding discovery will be permitted in accordance with the Rules.
All discovery shall be expressly limited to matters directly relevant to the dispute being arbitrated and must be completed no later than 20 days before the hearing date and within
180 days of the filing of the dispute with the AAA. Any requests for an extension of the discovery periods, or any discovery disputes, will be subject to final determination by the arbitrator
upon a 

showing that the request for discovery is essential for the party's presentation and that no alternative means for obtaining information is available. 

    (f)  Class Proceedings and Consolidations.  The resolution of any dispute arising pursuant to the terms
of this Agreement shall be determined by a separate arbitration proceeding and such dispute shall not be consolidated with other disputes or included in any class proceeding. 

    (g)  Payment Of Arbitration Costs And Fees  The arbitrator shall award all costs and expenses of the
arbitration proceeding. 

    (h)  Real Property Collateral; Judicial Reference.  Notwithstanding anything herein to the contrary, no
dispute shall be submitted to arbitration if the dispute concerns indebtedness secured directly or
indirectly, in whole or in part, by any real property unless (i) the holder of the mortgage, lien or security interest specifically elects in writing to proceed with the arbitration, or
(ii) all parties to the arbitration waive any rights or benefits that might accrue to them by virtue of the single action rule statute of California, thereby agreeing that all indebtedness and
obligations of the parties, and all mortgages, liens and security interests securing such indebtedness and obligations, shall remain fully valid and enforceable. If any such dispute is not submitted
to arbitration, the dispute shall be referred to a referee in accordance with California Code of Civil Procedure Section 638 et seq., and this general reference agreement is intended to be
specifically enforceable in accordance with said Section 638. A referee with the qualifications required herein for arbitrators shall be selected pursuant to the AAA's selection procedures.
Judgment upon the decision rendered by a referee shall be entered in the court in which such proceeding was commenced in accordance with California Code of Civil Procedure Sections 644 and 645. 

    (i)  Miscellaneous.  To the maximum extent practicable, the AAA, the arbitrators and the parties shall
take all action required to conclude any arbitration proceeding within 180 days of the filing of the dispute with the AAA. No arbitrator or other party to an arbitration proceeding may disclose
the existence, content or results thereof, except for disclosures of information by a party required in the ordinary course of its business or by applicable law or regulation. If more than one
agreement for arbitration by or between the parties potentially applies to a dispute, the arbitration provision most directly related to the Loan Documents or the subject matter of the dispute shall
control. This arbitration provision shall survive termination, amendment or expiration of any of the Loan Documents or any relationship between the parties. 

    IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first written above. 

	SABA SOFTWARE, INC., a Delaware corporation	 	WELLS FARGO BANK, NATIONAL ASSOCIATION
	

By:	
 	

/s/ Terry Carlitz
	
 	

By:	
 	

/s/ Eric C. Houser
 Eric C. Houser

Vice President
	Name:	 	Terry Carlitz
	 	 	 	 
	Title:	 	Chief Financial Officer
	 	 	 	 

QuickLinks

CREDIT AGREEMENT

RECITALS

ARTICLE I CREDIT TERMS

ARTICLE II REPRESENTATIONS AND WARRANTIES

ARTICLE III CONDITIONS

ARTICLE IV AFFIRMATIVE COVENANTS

ARTICLE V NEGATIVE COVENANTS

ARTICLE VI EVENTS OF DEFAULT

ARTICLE VII MISCELLANEOUS

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