Document:

EXHIBIT 10.1

 

INDEPENDENT CONTRACTOR AGREEMENT

 

This Independent Contractor
Agreement (this “Agreement”) is entered into as of the 10th day of April, 2017 (the “Effective
Date”), between United Development Funding III, L.P. (“Company”), and Stuart Ducote (“Contractor”).
The Company desires to retain Contractor as an independent contractor to perform services for the Company and Contractor is willing
to perform such services, on the terms set forth more fully below. In consideration of the mutual promises contained herein, the
parties agree as follows:

 

1.       Contractor’s
Services. Contractor agrees to provide Company with the services described on the attached Exhibit “A”
and such other related services that may be requested by Company from time to time (collectively, the “Services”).
Contractor and Company agree that the Services are to be directed by the Company’s General Partner. Contractor will make
regular reports to the Company’s General Partner regarding the status of Contractor’s Services to Company. Company
is under no obligation to use Contractor’s Services for any specific number of hours per week.

 

2.       Contractor’s
Obligations. Contractor will devote the necessary time and attention to perform the Services and shall use Contractor’s
best efforts and judgment in performing such Services. In performing the Services under this Agreement, Contractor will act in
good faith and in the best interest of Company, perform Contractor’s duties in accordance with the standards set by Company,
and comply with all applicable Company policies and procedures and applicable laws. Contractor will perform all Services directly
and will not subcontract or employ others to perform any aspect of the Services.

 

3.       
Independent Contractor Relationship.

 

(a)       Contractor
and Company agree that Contractor is an independent contractor and is not an employee of Company for any purpose. Company will
not provide any employment-related benefits to Contractor such as, but not limited to, workers compensation insurance, unemployment
compensation insurance, vacation or sick pay, pension or profit sharing benefits, or any type of health or disability insurance.
Company will not treat Contractor as its employee for federal, state, or local tax purposes. Contractor will have no power or authority
to incur or create any liability for or in the name of Company without the prior written consent of Company. Contractor has no
authority to direct, hire or fire any employees of Company.

 

(b)       The
Company will provide Contractor with written evidence that the Company maintains directors’ and officers’ insurance
covering Contractor in his capacity as an officer of the Company. Such insurance shall be in an amount that is equal to or greater
than the amount of insurance in place as of the Effective Date of this agreement. Furthermore, the Company will maintain such insurance
coverage with respect to occurrences arising during the term of this agreement for at least five years following the termination
or expiration of this agreement or will purchase a directors’ and officers’ extended reporting period or “tail”
policy to cover Contractor for such five year time period. Contractor will have loan approval rights for all future UDF III loans.

 

     

     

    

 

4.       Term.
The term of this Agreement shall begin on the Effective Date and continue until terminated by the parties in accordance with the
provisions of this Section 4. Either party may terminate this Agreement at any time upon sixty (60) days prior written notice
to the other party; provided, however, that upon receiving a notice of intent to terminate from the terminating party, the non-terminating
party may terminate this Agreement immediately by giving notice to the terminating party of the non-terminating party’s exercise
of its right to immediate termination of this Agreement and in such case, the sixty (60) day notice period will be deemed to be
automatically waived by both parties.

 

5.       Work
Product. Contractor agrees that Company is the exclusive owner of all right, title and interest in all works of whatever
nature, finished or unfinished, developed or created by Contractor, or paid for by Company, in the course of Contractor performing
the Services under this Independent Contractor Agreement, or related to the Services (the “Work Product”). Contractor
agrees that all intellectual property rights of whatever nature in the Work Product, in any stage of development, that Contractor
conceives, develops, or reduces to practice in connection with performing the Services shall be owned by the Company. “Intellectual
Property” includes (without limitation) all designs, concepts, documents, formulae, ideas and inventions (whether or not
patentable or reduced to practice), know-how, materials, plans, marks (including brand names, product names, logos and slogans),
methods, network configurations, and architectures, procedures, processes, protocols, schematics, analyses, and reports. Contractor
will deliver all Work Product to the Company (or any person designated by the Company in writing) in the form specified or as otherwise
designated by the Company.

 

5.       Confidential
Information. As used in this Agreement, the term “Confidential Information” shall mean all trade secrets or
confidential or proprietary information of the Company, and proprietary information of third parties provided to the Company in
confidence. By way of illustration and not limitation, “Confidential Information” shall include the Company’s
data and reports; computer materials such as programs, instructions, source and object code, and printouts; graphic designs, and
artwork; data compilations; development databases;, business improvements; business plans (whether pursued or not); ideas; designs;
drawings; budgets; unpublished financial statements; licenses; pricing strategies or cost data; information regarding the skills
and compensation of the employees of the Company; strategies’ forecasts, know-how and other marketing techniques; and the
identities of the Company’s suppliers and customers, and all information about those supplier and customer relationships
of the Company such as contact person(s), pricing, and other terms. Information received by Contractor will not be considered Confidential
Information if Contractor can prove, by clear and convincing evidence, that (1) Contractor lawfully knew such information prior
to the Company’s first disclosure to Contractor, (2) a third party rightfully disclosed such information to Contractor free
from any confidentiality duties or obligations, or (3) such information is, or through no fault of Contractor has become, generally
available to the public.

 

6.       Non-Use
and Non-Disclosure of Confidential Information. During the term of this agreement and at all times thereafter, Contractor
agrees that, except as required by judicial order or governmental laws or regulations, Contractor will not, during or subsequent
to the term of this Agreement, (i) use or permit other to use the Company’s Confidential Information for any purpose whatsoever
other than the performance of Contractor’s Services, or (ii) disclose or permit others to disclose the Company’s Confidential
Information to any third party without first obtaining the Company’s express written consent.

 

     

     

    

 

7.        Fees.
As consideration for entering into this Agreement and for providing the Services, Company will pay Contractor at a rate described
in Exhibit “A”. Contractor will be solely responsible for the payment of all taxes due on the payments made
by Company to Contractor.

 

8.       Return
and / or Destruction of Property; Nonhire; Nonsolicitation; Nondisparagement.

 

(a)       Upon
the termination of this Agreement, Contractor agrees to provide Company with a written inventory of all Company-owned property
in Contractor’s possession or under Contractor’s control and to immediately return and or destroy all Company-owned
property in Contractor’s possession or control. After termination, Contractor will not retain copies of any documents or
other property belonging to Company.

 

(b)       Contractor
agrees that Contractor shall not, while this Agreement is in effect and for a period of one (1) year after termination of this
Agreement, solicit for hire or hire any employee of Company or its affiliates.

 

(c)       During
and after the termination of this Agreement, Contractor shall not disparage or seek to injure the reputation of Company or its
officers, directors, agents, employees, parent, subsidiaries or affiliates.

 

9.       Voluntary
Waiver and Release of Liability. Contractor voluntarily waives all legal rights to claim, sue or attempt to hold liable
Company, its officers, directors, agents, employees, parent, subsidiaries or affiliates (collectively referred to as the “Released
Parties”), for any injury, death or property damage or other loss or damage sustained by Contractor in connection
with the provision of Services under this Agreement. Contractor expressly and voluntarily assumes all risks and full responsibility
for any injury, death or property damage or other loss or damage Contractor may incur arising out of or related to the provision
of Services to Company.

 

10.       Indemnification.

 

(a)       Contractor agrees, to the fullest
extent permitted by law, to indemnify and hold harmless the Company, its officers, directors and employees (collectively, the Company)
against all damages, liabilities or costs, including reasonable attorneys’ fees and defense costs, to the extent caused by
Contractor’s negligent performance of professional services under this Agreement and that of its subcontractors or anyone
for whom Contractor is legally liable.

 

(b)       The
Company agrees, to the fullest extent permitted by law, to indemnity and hold harmless Contractor and subcontractors (collectively,
Contractor) against all damages, liabilities or costs, including reasonable attorneys’ fees and defense costs, to the extent
caused by the Company’s negligent acts and the acts of its contractors, subcontractors or consultants or anyone for whom
the Company is legally liable. Neither the Company nor Contractor shall be obligated to indemnify the other party in any manner
whatsoever for the other party’s negligence.

 

     

     

    

 

11.       Arbitration.
Any dispute or disagreement regarding this Agreement or relating to the performance of Services for Company under this Agreement
shall be settled by final and binding arbitration conducted in Dallas, Texas under the Commercial Arbitration Rules of America
by the American Arbitration Association. The parties have the right to pursue the same claims in arbitration that they could pursue
in Texas state court or a federal court in Texas. Notwithstanding the foregoing provisions of this Section 10, Company shall
be entitled to seek and obtain injunctive relief in a court of law for any alleged breach by Contractor of Section 6 or
7 of this Agreement.

 

12.       Choice
of Law and Venue. The parties agree that this Agreement shall be governed by and construed under the laws of the State
of Texas, without regard to its conflicts of laws provisions.

 

13.       Severability;
Survival. Should any provision of this Agreement be declared or be determined by any court to be illegal or invalid, the
validity of the remaining parts, terms or provisions shall not be affected thereby and the illegal or invalid part, term or provisions
shall not be deemed to be a part of this Agreement.

 

14.       Survival.
The parties agree that the obligations created in paragraphs 6, 7, 8, 9 and 10 of this Agreement will survive the termination of
this Agreement.

 

15.       Successors.
This Agreement shall be binding upon and inure to the benefit of the assigns and successors of Company.

 

16.      Assignment. Contractor
may not assign or subcontract any of Contractor’s obligations under this Agreement without the prior written consent of Company.
Company may assign its rights and obligations under this Agreement by providing written notice to Contractor of the assignment.

 

17.       Notices.
Any notices, consents, demands, requests, approvals and other communications to be given under this Agreement by either party to
the other shall be deemed to have been duly given if given in writing and personally delivered or sent by registered or certified
mail or by a nationally recognized “next-day delivery service” to the address set forth below each party's signature
or to such other address as a party shall have delivered to the other party in writing for purposes of notice under this Agreement.
Notice shall be deemed to have been received (i) upon delivery, if given in person, (ii) the third day after deposit into a United
States mail receptacle, if delivered by United States mail, or (iii) upon confirmation of delivery from a nationally recognized
“next day delivery service”.

 

     

     

    

 

18.       Entire
Agreement. THIS AGREEMENT AND ITS EXHIBIT TOGETHER CONSTITUTE THE ENTIRE AGREEMENT AMONG THE PARTIES CONCERNING THE SUBJECT
MATTER HEREOF, AND ALL PRIOR DISCUSSIONS, AGREEMENTS AND STATEMENTS, WHETHER ORAL OR WRITTEN, ARE MERGED INTO THIS AGREEMENT AND
ITS EXHIBIT. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES AND THIS AGREEMENT AND ITS EXHIBIT MAY NOT BE CONTRADICTED
BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.

 

19.       Amendment.
This Agreement may be amended only in a writing signed by both parties.

 

20.       Acknowledgment.
By signing below, the parties certify and represent that they have carefully read and considered the foregoing Agreement and fully
understand all provisions of this Agreement and understand the consequences of signing this Agreement, and have signed this Agreement
voluntarily and without coercion, undue influence, threats, or intimidations of any kind or type whatsoever.

 

[The remainder of this page is left blank
intentionally.]

 

     

     

    

 

Contractor and Company have executed this
Agreement on this the 10th day of April, 2017, effective for all purposes as of the Effective Date.

 

COMPANY:

 

UNITED DEVELOPMENT FUNDING III, LP

a Delaware limited partnership

 

	By:	UMTH Land Development, L.P.	 
	 	a Delaware limited partnership	 
	 	its sole General Partner	 
	 	 	 	 
	 	BY:	UMT Services, Inc.,	 
	 	a Delaware corporation	 
	 	its General Partner	 
	 	 	 	 
	 	By:	/s/ Hollis M. Greenlaw	 
	 	 	Hollis M. Greenlaw	 
	 	Its:	President and CEO	 

  

Address for Notice:

1301 Municipal Way, Ste. 220

Grapevine, Texas 76051

 

STATE OF TEXAS

 

COUNTY OF TARRANT

 

This instrument was
acknowledged before me on the 14th day of April, 2017, by Hollis M. Greenlaw, President and CEO of UMT Services,
Inc., a Delaware corporation, General Partner of UMTH Land Development, L.P., a Delaware limited partnership, the sole General
Partner of United Development Funding, III, LP, a Delaware limited partnership, on behalf of said entity.

 

	 	/s/ Pamela E. Williams	 
	 	Notary Public, State of Texas	 

 

 

CONTRACTOR:

 

	/s/ Stuart Ducote	 
	Printed Name: Stuart Ducote	 

  

Address for Notice:

16027 Chalfont Circle

Dallas, Texas 75248

 

     

     

    

 

EXHIBIT A

 

  

 

SERVICES

 

 

 

	Service Description or Position:	Chief Financial Officer
	 	 
	Company Supervisor:	UMTH Land Development, L.P., General Partner
	 	 
	Start Date:	April 10, 2017

 

 

FEES

 

 

Contractor will be compensated at a monthly
rate of $7,500.00.Exhibit 10.1 

 

 

THIRD Amendment

to
AMENDED AND RESTATED

Loan
and security agreement

 

THIS
THIRD AMENDMENT to Amended and Restated Loan and Security Agreement (this “Amendment”) is entered into
as of April 12, 2017 and effective as of March 27, 2017, by and between SILICON VALLEY BANK (“Bank”) and SAJAN, INC.
(“Borrower”).

 

 

Recitals

 

A.                 
Bank and Borrower are parties to that certain Amended and Restated Loan and Security Agreement dated as of March 28,
2013 (the “Original Loan Agreement”), as amended by a First Amendment to Amended and Restated Loan and Security Agreement
dated as of March 26, 2015 (the “First Amendment”) and a Second Amendment to Amended and Restated Loan and Security
Agreement dated as of May 5, 2015 (the “Second Amendment”; the Original Loan Agreement, as amended by the First Amendment
and the Second Amendment shall be collectively referred to herein as the “Loan Agreement”).

 

B.                 
Borrower has requested that Bank make certain changes to the terms of the Loan Agreement, and Bank has agreed to do
so, in accordance with the terms and subject to the terms and conditions of this Amendment.

 

Agreement

 

Now,
Therefore, in consideration of the foregoing recitals and other good and valuable consideration, the receipt and adequacy
of which is hereby acknowledged, and intending to be legally bound, the parties hereto agree as follows:

 

1.                  
Definitions. Capitalized terms used but not defined in this Amendment shall have the meanings given to
them in the Loan Agreement.

 

2.                  
Amendments to Loan Agreement.

 

2.1               
Section 2.1.1 (Revolving Advances). Subsection (a) of Section 2.1.1 of the Loan Agreement is hereby deleted in its entirety
and replaced with the following:

 

(a)        Availability.
Subject to the terms and conditions of this Agreement and to deduction of Reserves, Bank shall make Advances not exceeding the
Availability Amount. Amounts borrowed hereunder may be repaid and, prior to the Revolving Line Maturity Date, reborrowed, subject
to the applicable terms and conditions precedent herein.

 

2.2               
Section 2.2 (Overadvances). Section 2.2 of the Loan Agreement is hereby deleted in its entirety and replaced with the
following:

 

2.2
       Overadvances. If, at any time, the outstanding principal
amount of any Advances exceeds the lesser of either the Revolving Line or the Borrowing Base, Borrower shall immediately pay to
Bank in cash the amount of such excess (such amount, the “Overadvance”). Without limiting Borrower’s obligation
to repay Bank any Overadvance, Borrower agrees to pay Bank interest on the outstanding amount of any Overadvance, on demand, at
a per annum rate equal to the rate that is otherwise applicable to Advances plus five percent (5.0%).

 

2.3               
Section 2.3 (Payment of Interest on the Credit Extensions). Subsection (a) of Section 2.3 of the Loan Agreement is hereby
deleted in its entirety and replaced with the following:

 

 

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(a)        Interest
Rate. Subject to Section 2.3(b), the principal amount outstanding under the Revolving Line shall accrue interest at a floating
per annum rate equal to (A) one half of one percent (0.5%) above the Prime Rate when the Liquidity Ratio is greater than or equal
to 1.75 to 1.0, and (B) one and three quarters of one percent (1.75%) above the Prime Rate when the Liquidity Ratio is less than
1.75 to 1.0, provided that the interest rate shall at no times be less than 4.0% per annum. Interest shall be payable monthly in
accordance with Section 2.3(d) below.

 

2.4               
Section 2.4 (Fees). Section 2.4(b) is hereby deleted in its entirety.

 

2.5               
Section 3.2 (Conditions Precedent to all Credit Extensions). Subsections (a) and (b) of Section 3.2 of the Loan Agreement
are each hereby deleted in its entirety and replaced with the following:

 

(a)        timely
receipt of the Credit Extension request and any materials and documents required by Section 3.4;

 

(b)        the
representations and warranties in this Agreement shall be true, accurate, and complete in all material respects on the date of
the proposed Credit Extension and on the Funding Date of each Credit Extension; provided, however, that such materiality qualifier
shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text
thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true,
accurate and complete in all material respects as of such date, and no Event of Default shall have occurred and be continuing or
result from the Credit Extension. Each Credit Extension is Borrower’s representation and warranty on that date that the representations
and warranties in this Agreement remain true, accurate, and complete in all material respects; provided, however, that such materiality
qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in
the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall
be true, accurate and complete in all material respects as of such date; and

 

2.6               
Section 3.4 (Procedures for Borrowing). Section 3.4 of the Loan Agreement is hereby deleted in its entirety and replaced
with the following:

 

3.4
       Procedures for Advances. Subject to the prior satisfaction
of all other applicable conditions to the making of an Advance set forth in this Agreement, to obtain an Advance, Borrower shall
notify Bank (which notice shall be irrevocable) by electronic mail by 12:00 p.m. Pacific time on the Funding Date of the Advance.
Such notice shall be made by Borrower through Bank’s online banking program, provided, however, if Borrower is not utilizing
Bank’s online banking program, then such notice shall be in a written format acceptable to Bank that is executed by an Authorized
Signer. Bank shall have received satisfactory evidence that the provision of such notices and the requests for Advances have been
approved by the Board. In connection with any such notification, Borrower must promptly deliver to Bank by electronic mail or through
Bank’s online banking program such reports and information, including without limitation, when a Streamline Period is not
in effect, sales journals, cash receipts journals, accounts receivable aging reports, as Bank may request in its sole discretion.
Bank shall credit proceeds of an Advance to the Designated Deposit Account. Bank may make Advances under this Agreement based on
instructions from an Authorized Signer or his or her designee or without instructions if the Advances are necessary to meet Obligations
that have become due. 

 

2.7               
Section 4.1 (Grant of Security Interest). The third paragraph of Section 4.1 of the Loan Agreement is hereby deleted
in its entirety and replaced with the following:

 

If this Agreement
is terminated, Bank’s Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity obligations)
are satisfied in full in cash, and at such time as Bank’s obligations to make Credit Extensions has terminated, Bank shall,
at Borrower’s sole cost and expense, terminate its security interest in the Collateral and all rights therein shall revert
to Borrower. In the event (x) all Obligations (other than inchoate indemnity obligations), except for Bank Services, are satisfied
in full, and (y) this Agreement is terminated, Bank shall terminate the security interest granted herein upon Borrower providing
cash collateral acceptable to Bank in its good faith business judgment for Bank Services, if any. In the event such Bank Services
consist of outstanding Letters of Credit, Borrower shall provide to Bank cash collateral in an amount equal to (x)
if such Letters of Credit are denominated in Dollars, then at least one hundred five percent (105.0%); and (y) if such Letters
of Credit are denominated in a Foreign Currency, then at least one hundred ten percent (110.0%),  of the Dollar Equivalent
of the face amount of all such Letters of Credit plus all interest, fees, and costs due or to become due in connection therewith
(as estimated by Bank in its good faith business judgment), to secure all of the Obligations relating to such Letters of Credit.

 

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2.8               
Section 5.3 (Accounts Receivable). Section 5.3 of the Loan Agreement is hereby deleted in its entirety and replaced
with the following:

 

5.3
       Accounts Receivable. For each Account with respect
to which Advances are requested, on the date each Advance is requested and made, such Account shall be an Eligible Account. All
statements made and all unpaid balances appearing in all invoices, instruments and other documents evidencing such Eligible Accounts
are and shall be true and correct and all such invoices, instruments and other documents, and all of Borrower's Books are genuine
and in all respects what they purport to be. All sales and other transactions underlying or giving rise to each Eligible Account
shall comply in all material respects with all applicable laws and governmental rules and regulations. Borrower has no knowledge
of any actual or imminent Insolvency Proceeding of any Account Debtor whose accounts are Eligible Accounts in any Borrowing Base
Report. To the best of Borrower’s knowledge, all signatures and endorsements on all documents, instruments, and agreements
relating to all Eligible Accounts are genuine, and all such documents, instruments and agreements are legally enforceable in accordance
with their terms.

 

2.9               
Section 5.10 (Use of Proceeds). Section 5.10 of the Loan Agreement is hereby amended to delete the words “to pay
off all or a portion of the $750,000 note payable to Shannon and Angel Zimmerman,”.

 

2.10           
Section 6.2 (Financial Statements, Reports, Certificates). Subsections (a) and (b) of Section 6.2 of the Loan Agreement
are each hereby deleted in its entirety and replaced with the following:

 

(a)        Borrowing
Base Report. A Borrowing Base Report (and any schedules related thereto) (i) when a Streamline Period is in effect, (A) within
thirty (30) days after the end of each month, and (B) together with each request for a Credit Extension, and (ii) when a Streamline
Period is not in effect, (A) no later than Friday of each week, unless previously delivered during such week together with
a request for Credit Extension, and (B) with each request for a Credit Extension;

 

(b)        Reports.
Within thirty (30) days after the end of each month, (A) monthly accounts receivable agings, aged by invoice date, (B) monthly
accounts payable agings, aged by invoice date, and outstanding or held check registers, if any, and (C) when a Streamline Period
is not in effect, monthly reconciliations of accounts receivable agings (aged by invoice date), which shall be provided
at Bank’s request, and general ledger;

 

2.11           
Section 6.3 (Accounts Receivable). Subsection (e) of Section 6.3 of the Loan Agreement is hereby deleted in its entirety
and replaced with the following:

 

(e)       Verification.
Bank may, from time to time, verify directly with the respective Account Debtors the validity, amount and other matters relating
to the Accounts, either in the name of Borrower or Bank or such other name as Bank may choose, and notify any Account Debtor of
Bank’s security interest in such Account. In addition, Bank may notify Account Debtors to make payments in respect of Accounts
directly to Bank, provided Bank will endeavor to notify Borrower in advance.

 

2.12           
Section 6.6 (Access to Collateral; Books and Records). Section 6.6 of the Loan Agreement is hereby deleted in its entirety
and replaced with the following:

 

6.6
       Access to Collateral; Books and Records. At reasonable
times, on five (5) Business Days’ notice (provided no notice is required if an Event of Default has occurred and is continuing),
Bank, or its agents, shall have the right to inspect the Collateral and the right to audit and copy Borrower’s Books. Subject
to the last sentence of this Section 6.6, the foregoing inspections and audits shall be conducted at Borrower’s expense and
no more often than once every six (6) months unless an Event of Default has occurred and is continuing or as Bank determines in
its good faith business judgment that conditions warrant more frequent inspections or audits. The charge therefor shall be One
Thousand Dollars ($1,000) per person per day (or such higher amount as shall represent Bank’s then-current standard charge
for the same), plus reasonable out-of-pocket expenses. In the event Borrower and Bank schedule an audit more than ten (10) days
in advance, and Borrower cancels or seeks to reschedule the audit with less than ten (10) days written notice to Bank, then (without
limiting any of Bank’s rights or remedies) Borrower shall pay Bank a fee of One Thousand Dollars ($1,000) plus any out-of-pocket
expenses incurred by Bank to compensate Bank for the anticipated costs and expenses of the cancellation or rescheduling. Unless
an Event of Default is continuing, field inspections or collateral audits shall not occur more than once in any calendar year,
and shall not be required in any calendar year in which no Advance at any one time in excess of $750,000 has been outstanding.

 

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2.13           
Section 6.9 (Financial Covenants). Section 6.9 of the Loan Agreement is hereby deleted in its entirety and replaced
with the following:

 

6.9       Financial
Covenants. Maintain at all times the following covenants, to be tested as of the last day of
each month: 

 

(a)        Tangible
Net Worth. On a consolidated basis, Tangible Net Worth of at least $4,000,000, increasing as of the last day of each fiscal
quarter of Borrower after the Third Amendment Date by an amount equal to 25% of the sum of (i) Net Income for such quarter, (ii)
any increase in the principal amount of outstanding Subordinated Debt during such quarter, and (iii) the net amount of proceeds
received by Borrower in such quarter from the sale or issuance of equity securities. Notwithstanding the foregoing, to the extent
Net Income is less than zero in any quarter, Net Income shall be deemed zero for purposes of the above Tangible Net Worth calculation.

 

(b)        EBITDA.
Upon the consummation of a Permitted Acquisition, Section 6.9(a) shall cease to be of any force or effect, and thereafter Borrower
shall maintain, on a consolidated basis, EBITDA of at least $250,000 for the trailing six (6) month period ending on the last day
of each month.

 

2.14           
Section 6.13 (Online Banking). A new Section 6.13 to read as follows is hereby added immediately prior to existing Section
6.13 of the Loan Agreement, and Section 6.13 is renumbered to be Section 6.14 of the Loan Agreement:

 

6.13       Online
Banking. Utilize Bank’s online banking platform for all matters requested by Bank which
shall include, without limitation (and without request by Bank for the following matters), uploading information pertaining to
Accounts and Account Debtors, requesting approval for exceptions, requesting Credit Extensions, and uploading financial statements
and other reports required to be delivered by this Agreement (including, without limitation, those described in Section 6.2 of
this Agreement).

 

2.15           
Section 8.2 (Covenant Default). Subsection (a) of Section 8.2 of the Loan Agreement is hereby deleted in its entirety
and replaced with the following:

 

(a)        Borrower
fails or neglects to perform any obligation under Section 6.1, 6.2, 6.6, 6.5, 6.7, 6.8 or 6.9 or violates any covenant in Section
7; or

 

2.16           
Section 9.1 (Rights and Remedies). Subsection (c) of Section 9.1 of the Loan Agreement is hereby deleted in its entirety
and replaced with the following:

 

(c)        for
any Letters of Credit, require that Borrower (i) deposit cash with Bank in an amount equal to at
least (A) one hundred five percent (105.0%) of the Dollar Equivalent of the aggregate face amount of all Letters of Credit denominated
in Dollars remaining undrawn, and (B) one hundred ten percent (110.0%) of the Dollar Equivalent of the aggregate face amount of
all Letters of Credit denominated in a Foreign Currency remaining undrawn (plus, in each case, all interest, fees, and costs
due or to become due in connection therewith (as estimated by Bank in its good faith business judgment)), to secure all of the
Obligations relating to such Letters of Credit, as collateral security for the repayment of any future drawings under such Letters
of Credit, and Borrower shall forthwith deposit and pay such amounts, and (ii) pay in advance all letter of credit fees scheduled
to be paid or payable over the remaining term of any Letters of Credit;

 

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2.17           
Section 9.2 (Power of Attorney). Section 9.2 is hereby deleted in its entirety and replaced with the following:

 

9.2       Power
of Attorney. Borrower hereby irrevocably appoints Bank as its lawful attorney-in-fact to: (a)
exercisable upon the occurrence and during the continuance of an Event of Default, (i) sign Borrower’s name on any invoice
or bill of lading for any Account or drafts against Account Debtors; (ii) demand, collect, sue, and give releases to any Account
Debtor for monies due, settle and adjust disputes and claims about the Accounts directly with Account Debtors, and compromise,
prosecute, or defend any action, claim, case, or proceeding about any Collateral (including filing a claim or voting a claim in
any bankruptcy case in Bank’s or Borrower’s name, as Bank chooses); (iii) make, settle, and adjust all claims under
Borrower’s insurance policies; (iv) pay, contest or settle any Lien, charge, encumbrance, security interest, or other claim
in or to the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same; (v) transfer
the Collateral into the name of Bank or a third party as the Code permits; and (vi) receive, open and dispose of mail addressed
to Borrower; and (b) regardless of whether an Event of Default has occurred, (i) endorse Borrower’s name on any checks, payment
instruments, or other forms of payment or security; and (ii) notify all Account Debtors to pay Bank directly. Borrower hereby appoints
Bank as its lawful attorney-in-fact to sign Borrower’s name on any documents necessary to perfect or continue the perfection
of Bank’s security interest in the Collateral regardless of whether an Event of Default has occurred until all Obligations
have been satisfied in full and Bank’s obligation to make Credit Extensions has terminated. Bank’s foregoing appointment
as Borrower’s attorney in fact, and all of Bank’s rights and powers, coupled with an interest, are irrevocable until
all Obligations have been fully repaid and performed and the Loan Documents have been terminated.

 

2.18           
Section 13.1 (Definitions). The following definitions set forth in Section 13.1 of the Loan Agreement are hereby deleted
in their entirety and replaced with the following, or, as applicable, added in alphabetical order to Section 13.1 of the Loan Agreement:

 

“Authorized
Signer” is any individual listed in Borrower’s Borrowing Resolution who is authorized to execute the Loan Documents,
including making (and executing if applicable) any Credit Extension request, on behalf of Borrower.

 

“Borrowing Base”
is up to 85% of Eligible Accounts, as determined by Bank from Borrower’s most recent Borrowing Base Report; provided, however,
that Bank may increase or decrease the foregoing percentage in its good faith business judgment based on events, conditions, contingencies,
or risks which, as determined by Bank, may positively or adversely affect Collateral.

 

“Borrowing
Base Report” is that certain report of the value of certain Collateral in the form attached hereto as Exhibit B.

 

“Prime Rate”
is the rate of interest per annum from time to time published in the money rates section of The Wall Street Journal or any successor
publication thereto as the “prime rate” then in effect; provided that , in the
event such rate of interest is less than zero, such rate shall be deemed to be zero for purposes of this Agreement; and provided
further that if such rate of interest, as set forth from time to time in the money rates section of The Wall Street Journal,
becomes unavailable for any reason as determined by Bank, the “Prime Rate” shall mean the rate of interest per annum
announced by Bank as its prime rate in effect at its principal office in the State of California (such Bank announced Prime Rate
not being intended to be the lowest rate of interest charged by Bank in connection with extensions of credit to debtors);
provided that, in the event such rate of interest is less than zero, such rate shall be deemed to be zero for purposes of this
Agreement.

 

“Revolving Line Maturity
Date” is March 27, 2018.

 

“Streamline Period”
is any period of time, on and after the Effective Date, where Borrower has maintained a Liquidity Ratio of at least 2.00 to 1.00
at all times during the prior two (2) consecutive calendar months and provided further that upon the occurrence of an Event of
Default any Streamline Period then in effect shall immediately terminate and Borrower shall be required to maintain the foregoing
financial ratio for two (2) consecutive months thereafter before a new Streamline Period begins.

 

    5 

     

    

 

“Third Amendment Date”
is March 27, 2017.

 

 

2.19           
Section 13.1 (Definitions). The definition for “Transaction Report” in Section 13.1 of the Loan Agreement
is hereby deleted.

 

2.20           
Exhibit B (Borrowing Base Report). Exhibit B of the Loan Agreement is hereby deleted in its entirety and replaced with
Exhibit B attached hereto.

 

2.21           
Exhibit C (Compliance Certificate). Exhibit C of the Loan Agreement is hereby deleted in its entirety and replaced with
Exhibit C attached hereto.

 

3.                  
Limitation of Amendments.

 

3.1               
The amendments set forth in Section 2 above, are effective for the purposes set forth herein and shall be limited
precisely as written and shall not be deemed to (a) be a consent to any amendment, waiver or modification of any other term
or condition of any Loan Document, or (b) otherwise prejudice any right or remedy which Bank may now have or may have in the
future under or in connection with any Loan Document.

 

3.2               
This Amendment shall be construed in connection with and as part of the Loan Documents and all terms, conditions, representations,
warranties, covenants and agreements set forth in the Loan Documents, except as herein amended, are hereby ratified and confirmed
and shall remain in full force and effect.

 

4.                  
Representations and Warranties. To induce Bank to enter into this Amendment, Borrower hereby represents
and warrants to Bank as follows:

 

4.1               
Immediately after giving effect to this Amendment (a) 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 in all material respects as of such date), and
(b) no Event of Default has occurred and is continuing;

 

4.2               
Borrower has the power and authority to execute and deliver this Amendment and to perform its obligations under the
Loan Agreement, as amended by this Amendment;

 

4.3               
The organizational documents of Borrower delivered to Bank on or just prior to the Third Amendment Date remain true,
accurate and complete and have not been amended, supplemented or restated and are and continue to be in full force and effect;

 

4.4               
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;

 

4.5               
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, do not and will not contravene (a) any law or regulation binding on or affecting
Borrower, (b) any contractual restriction with a Person binding on Borrower, (c) any order, judgment or decree of any
court or other governmental or public body or authority, or subdivision thereof, binding on Borrower, or (d) the organizational
documents of Borrower;

 

4.6               
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, do not require any order, consent, approval, license, authorization or validation
of, or filing, recording or registration with, or exemption by any governmental or public body or authority, or subdivision thereof,
binding on Borrower, except as already has been obtained or made; and

 

4.7               
This Amendment has been duly executed and delivered by Borrower and is the binding obligation of Borrower, enforceable
against Borrower 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.

 

    6 

     

    

 

5.                  
Ratification of Perfection Certificate. Borrower hereby ratifies, confirms and reaffirms the disclosures
contained in the Perfection Certificate most recently delivered to Bank.

 

6.                  
Integration. This Amendment and the Loan Documents represent the entire agreement about this subject matter
and supersede prior negotiations or agreements. All prior agreements, understandings, representations, warranties, and negotiations
between the parties about the subject matter of this Amendment and the Loan Documents merge into this Amendment and the Loan Documents.

 

7.                  
Counterparts. This Amendment may be executed in any number of counterparts and all of such counterparts
taken together shall be deemed to constitute one and the same instrument.

 

8.                  
Effectiveness. This Amendment shall be deemed effective upon (a) the due execution and delivery to Bank
of this Amendment by each party hereto, (b) the due execution and delivery to Bank of an affirmation of guaranty by Sajan Software
Limited, Sajan Spain S.L. and Sajan Singapore Pte. Ltd., and (c) Borrower’s payment of (i) a fully-earned, non-refundable
amendment fee in an amount equal to Eight Thousand Seven Hundred Fifty Dollars ($8,750) and (ii) Bank’s reasonable and documented
legal fees and expenses incurred in connection with this Amendment.

 

 

[Signature page follows.]

 

 

 

 

 

    7 

     

    

 

In
Witness Whereof, the parties hereto have caused this Amendment to be duly executed and delivered as of the date first
written above.

 

 

	BORROWER:	 
	 	 	 
	SAJAN,
    INC.	 
	 	 	 
	By:	/s/
    Thomas P. Skiba	 
	Name:	Thomas
    P. Skiba	 
	Title:	Chief
    Financial Officer	 
	 	 	 
	 	 	 
	BANK:	 
	 	 	 
	SILICON
    VALLEY BANK	 
	 	 	 
	By:	/s/
    Brian Powers	 
	Name:	Brian Powers	 
	Title:	Vice
    President 	 

 

     

     

    

 

EXHIBIT B

 

BORROWING BASE REPORT

 

[Form
provided by Bank]

 

 

 

 

 

 

     

     

    

 

EXHIBIT C

 

COMPLIANCE CERTIFICATE

 

TO:SILICON VALLEY BANKDate: 

FROM: SAJAN, INC.

 

The undersigned authorized
officer of SAJAN, INC. ( “Borrower”) certifies that under the terms and conditions of the Amended and Restated Loan
and Security Agreement between Borrower and Bank (the “Agreement”):

 

(1) Borrower is
in complete compliance for the period ending _______________ with all required covenants except as noted below; (2) there
are no continuing Events of Default; (3) all representations and warranties in the Agreement are true and correct in all material
respects on this date except as noted below; provided, however, that such materiality qualifier shall not be applicable to any
representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further
that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material
respects as of such date; (4) Borrower, and each of its Subsidiaries, has timely filed all required tax returns and reports,
and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower
except as otherwise permitted pursuant to the terms of Section 5.9 of the Agreement; and (5) no Liens have been levied or
claims made against Borrower or any of its Subsidiaries relating to unpaid employee payroll or benefits of which Borrower has not
previously provided written notification to Bank.

 

Attached are the required
documents supporting the certification. 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. Capitalized terms used but
not otherwise defined herein shall have the meanings given them in the Agreement.

 

	Please indicate compliance status by circling Yes/No under “Complies” column.
	 
	Reporting Covenant	Required	Complies
	 	 	 
	Monthly financial statements with 

Compliance Certificate	Monthly within 30 days	Yes   No
	
        Audited financial statements

        10-Q, 10-K and 8-K
	
        Annually within 120 days of FYE

        Within 5 days after filing with SEC
	
        Yes No

        Yes No

	
        A/R & A/P Agings

         
	Monthly within 30 days	Yes   No
	Monthly Reconciliation of A/R Agings (aged by invoice date) and general ledger	
        If Streamline Period is in effect: not required

        If Streamline Period is not in effect: monthly within
        30 days
	Yes   No
	Borrowing Base Report	
        If Streamline Period is in effect: monthly
        within 30 days and with each request for Credit Extension

        If Streamline Period is not in effect: weekly
        every Friday unless previously delivered during such week with a request for Credit Extension, and with each request for Credit
        Extension
	Yes   No
	Collateral Audit	Annually, if Advances outstanding at any one time exceed $750,000	Yes   No
	Annual financial projections	Within 30 days of FYE	  Yes   No

 

     

     

    

 

	Financial Covenant	Required	Actual	Complies
	Minimum Tangible Net Worth	$4,000,000*, tested monthly	$________	Yes   No
	EBITDA for trailing 6 months then ended **	$250,000, tested monthly 	$________	Yes  No

 

* plus 25% of quarterly Net Income (excluding losses), Subordinated
Debt and new

Equity after Third Amendment Date as set forth in
Section 6.9(a)

 

**applies in lieu of Minimum Tangible Net Worth covenant
after a Permitted Acquisition

 

	Performance Pricing	Applies
	Liquidity Ratio greater than or equal to 1.75 to 1.0	Prime + 0.5%, but not less than 4.0%	Yes   No
	Liquidity Ratio less than 1.75 to 1.0	Prime + 1.75%, but not less than 4.0%	Yes  No

 

 

The following financial covenant analyses and information
set forth in Schedule 1, if any, attached hereto are true and accurate as of the date of this Certificate.

 

 

     

     

    

 

The following are the exceptions with respect to the certification above: (If no exceptions exist, state “No exceptions
to note.”)

 

 

 

 

 

 

 

 

	SAJAN, INC., a Delaware corporation	 	BANK USE ONLY	 
	 	 	 	 	 	 
	 	 	 	Received by:	 	 
	By: 	 	 	 	authorized signer	 
	Name: 	 	 	Date:	 	 
	Title: 	 	 	Verified:	 	 
	 	 	 	 	authorized signer	 
	 	 	 	Date: 	 	 
	 	 	 	 	 	 
	 	 	 	Compliance Status:	      Yes    No	 
	 	 	 	 	 	 

 

 

 

     

     

    

 

Schedule 1 to Compliance Certificate

 

Financial Covenants of Borrower

 

In the event of a conflict between this Schedule and the Loan
Agreement, the terms of the Loan Agreement shall govern.

  

Dated:____________________

 

I.       Tangible
Net Worth (Section 6.9(a))

 

Required:$4,000,000*

 

Actual:

 

	A.	Consolidated Total Assets	
        $__________

         

	B.	
        Intangible Assets (including goodwill, other intangible items,
        and notes, accounts receivable and other obligations owing to Borrower from officers and other Affiliates)

         
	$__________
	C.	Total Liabilities	$__________
	D.	Subordinated Debt	$__________
	E.	Tangible Net Worth (A-B-C+D)	$__________

 

Is line E equal to or greater than $4,000,000*?

 

	 	  No, not in compliance	 	  Yes, in compliance	 

 

*For measurements after the Third Amendment Date, increase by
25% of the sum of Net Income (if greater than zero), the amount of any increase in the principal amount of Subordinated Debt and
new equity net proceeds on the last day of each fiscal quarter of Borrower.

 

II.       EBITDA (Section
6.9(b))

 

Required:$250,000 for trailing 6-month period then ended**

 

Actual:

 

	A.	Net Income 	
        $__________

         

	B.	To the extent included in the determination of Net Income	
         

         

	 	1.	The provision for income taxes	
        $__________

         

	 	2.	Depreciation expense	
        $__________

         

	 	3.	Amortization expense	
        $__________

         

	 	4.	Net interest expense	
        $__________

         

	 	5.	All other charges which are both non-cash and non-recurring	
        $__________

         

	 	6.	All non-cash income	
        $__________

         

	 	7.	The sum of lines 1 through 5 minus line 6	
        $__________

         

	 	 	 
	C.	EBITDA (line A plus line B.7)	
        $__________

         

   

Is line C equal to or greater than $250,000?

 

	 	  No, not in compliance	 	  Yes, in compliance	 

 

** Applies after consummation of a Permitted Acquisition in lieu of Tangible Net Worth covenant.

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